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Philippine Financial Reporting Standards

REVENUE MEMORANDUM CIRCULAR NO. 19-2024

2024-02-15T15:20:43+08:00

The Table below shows the differences between the accounting treatment and current tax treatment on interest expenses.  Particulars  Accounting Treatment  Current Tax Treatment  Interest Expense on borrowing arrangements  Interest is recognized as an expense using the effective interest method. Interests incurred directly attributable to the acquisition of a qualifying asset are capitalized as part of the cost of the asset.  Interest can be claimed as a deduction, subject to certain limitations, provided all the criteria are met.    Interest incurred to acquire property used in trade, business or exercise of profession may be recognized as an expense in the year incurred [...]

REVENUE MEMORANDUM CIRCULAR NO. 19-20242024-02-15T15:20:43+08:00

REVENUE MEMORANDUM CIRCULAR NO. 12-2024

2024-02-08T15:25:23+08:00

Clarifies the treatment of foreign currency transactions for financial reporting and internal revenue tax purposes.   The Table below shows the differences between the foreign exchange (forex) gains/losses recognized in the financial statements prepared under the Philippine Financial Reporting Standards (PFRS)/Philippine Accounting Standards (PAS) and the forex gains/losses as income or allowable deduction for Income Tax purposes.  PARTICULARS  PFRS  CURRENT TAX TREATMENT  Initial measurement of foreign currency transactions  All foreign currency transactions are recorded in the entity’s functional currency using the spot rate of exchange at transaction date.  Foreign currency transaction are translated into Philippine Peso using the prevailing interbank reference [...]

REVENUE MEMORANDUM CIRCULAR NO. 12-20242024-02-08T15:25:23+08:00
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