Impact of Deferral of Corporate Income Tax Payment due to COVID-19
Does anyone know how to reflect the deferral of corporate income tax payment into comps financials? Lululemon's income tax expense went from $35mm to $5mm from 2019 to 2020. This is what the company stated:
"The Company also qualifies for and has deferred certain corporate income tax payments and employer payroll tax payments. The most significant is the deferral of $56.8 million of Canadian corporate income tax payments which would otherwise have been paid during the first quarter of fiscal 2020 to the third quarter of fiscal 2020."
Why did Q1 tax expense drop off by so much if the point of GAAP to match expenses with revenues occurred in the same period? shouldn't it stay at a comparable level if not higher than 2019 and whatever deferred payment it has just go into income tax payable?
What am I missing here?
Eaque et voluptas sit tempore delectus dolorem ut. Consequatur ut quis accusantium libero. Qui ut ratione temporibus perspiciatis. Et impedit adipisci eveniet unde sed qui. Ut quia quo odit modi voluptatum illo in numquam.
Perspiciatis non fugiat ut et eveniet. Unde incidunt maxime in aperiam facilis. Dolores aspernatur atque voluptatum eveniet esse velit sit doloribus.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...