Reconciliation Fiscal

Maybe for you that day - the day wrestling in the accounting field are already familiar with the term Fiscal Reconciliation. Reconciliation is done because of differences in income according to accounting (commercial) who arranged for the purpose of assessing the company's financial performance and standards of Financial Accounting System, while the earnings according to tax (fiscal) made with a view to preparing tax calculations and berstandarkan in tax laws (Tax Law income).

Some approaches in preparing the Financial Report Fiscal:

1. Fiscal financial report prepared in conjunction with the commercial financial statements (although the Financial Statements prepared commercially but the tax provisions are still very dominant in the preparation of financial statements)

2. The financial statements of extra fiscal komtabel with business financial statements (financial statements prepared separately with the fiscal financial report and are in addition to commercial or complementary)

3. Fiscal financial report prepared by inserting a provision - the provision of business taxation in the financial statements (financial statements prepared on GAAP but if there are tax provisions that are inconsistent with the provisions of Financial Accounting Standards dominant tax)

To bridge pebedaan anta Fiscal and Financial Statements of assets and efficiency of the latter approach is often done.

The cause of the differences with the Commercial Financial Report Financial Report Fiscal:

1. Differences Accounting Principles

Some things that have been recognized in FAS but not recognized in Fiscal:

• Principle of Conservatism, that is inventory valuation with Lower of Cost or Market and valuation of receivables with the estimated net realizable value are recognized in FAS but not recognized in Fiscal

• Principle of Cost, labor in kind included in the determination of the cost price of manufactured goods are recognized in FAS but not according to the Fiscal.

• Matching principle between costs and outcomes, ie the depreciation cost is calculated when      the asset has been produced by a commercial, but according to the Fiscal can be done before these assets generate

2. Differences Accounting Methods and Procedures

• Inventory Valuation Method, which is in commercial permits selecting from all existing methods in determining the cost of inventories in fiscal whereas there are only two methods: the average and FIFO.

• Method of Depreciation and Amortization, which is in the commercial may choose from all the existing methods of depreciation, whereas in non-tangible assets for the fiscal building only two methods: straight line and declining balance and to assets in the form of buildings only straight-line method, as well as with age economic and commercial value of the residue can determine for themselves while in fiscal governed by the Laws of Taxation.

• Method of Elimination of receivables, which is in a commercial based backup methods, while in Fiscal deletion takes place at the receivables really are not collectible

3. Treatment differences and Revenue and Expense Recognition

• Income recognized by a commercial but not recognized by the fiscal should be deducted from the commercial profit.

• certain income in the commercial and tax shall be final it must be deducted from the profits of commercial

• Other income and extraordinary items, namely:

a) Losses by commercial enterprises abroad are not deductible against income

b) Losses in the country according to the Fiscal can be deducted against the total income of origin do not over 5 years

• Costs are recognized under commercial but not recognized by the fiscal, among others:

a) Replacement or compensation in kind

b) Income tax

c) administrsi sanctions, fines, interest, increase

d) Fees charged taxpayers for personal gain or his dependents

e) Fees charged for the personal benefit of shareholders, partners and members

Effect of Amendments to the Income and Fiscal Fiscal Fiscal Cost 

Fiscal Correction	Fiscal Earnings	Fiscal costs
Positive Negative	Increased Decreased	Decreased Increased