Value Proposition: The Income Tax Provision Summary establishes the Tax Expense figure and explains the balances of Tax Payable and DTA/DTL in the books: Provision Summary (Current/Deferred) → JE Templates → Rollforwards (Payable & Deferred) → Tie-out to TB → Tax Note Pack Instead of a single tax entry, which leaves questions during closing or preparation of disclosures.

In 20 Seconds: What Will You Get?

• Tax Provision Summary details Current tax and Deferred tax and produces the Total tax expense figure.
• Tax Expense Entry (JE Templates) ready entries: Current/Deferred + DTA/DTL movement + Tax payable.
• Income Tax Payable Rollforward: Opening + Provision – Payments ± Adjustments = Closing.
• Deferred Tax Rollforward: DTA/DTL movement by type of difference (Temporary differences) or by account.
• TB Tie-out links the final balance to TB accounts (Payable / DTA / DTL / Tax expense).
• Effective Tax Rate (ETR) Bridge (optional within the summary) explains the difference between the statutory and effective rates through reconciliation items.
• Tax Note Pack ready for disclosures: movement tables + comparative figures + index of evidence.

CTA related to deliverables: Receive Provision Summary + JE Templates + Rollforwards to establish the Tax expense figure and explain the balances of Tax payable and DTA/DTL within the Closing/Disclosure file.

Suitable For

• Financial Controller seeking accurate tax entries + explanation of Tax accounts balances at Month-End/Year-End.
• Tax Accountant needing a provision summary linked to reconciliations and prepared for Tax note preparation.
• Reporting / GL Supervisor wanting a clear tie-out between workpaper and TB before approval.

Not Suitable For

• Those looking to calculate CIT from scratch—this product assumes the existence of computation/estimate and converts it into entries, documentation, and TB linkage.
• Those who do not recognize deferred tax in their statements or lack clear accounts/policy for it—can use the Current part only, but the value of the product decreases.

Without Summary / With Summary (Quick Comparison)

Before Use: 5 Symptoms of Tax Provision Issues

• Tax expense appears as a single figure without separation of Current/Deferred and cannot explain its components.
• The Income Tax Payable account does not close with payments or does not match the provision.
• Deferred tax (DTA/DTL) exists in TB but there is no rollforward explaining the increase/decrease.
• When preparing disclosures (Tax note), the search for number sources begins among different files.
• Tax figures change after closing the statements due to late entries or lack of tie-out.

Tax Provision: Implementation Method (3 Steps Without Gaps)

Step 1: Preparation and Report Gathering

• Extract TB/GL for tax accounts: Tax expense, Income tax payable, DTA/DTL.
• Prepare the basis for computation: CIT computation or provision estimate for the period (current tax).
• Gather payment movements: tax payments during the period + transfer references/receipts.

Step 2: Current/Deferred + Entries + JE Log

• Fill out the Tax provision summary (Current + Deferred) and produce the total Tax expense for the period.
• Generate JE templates: Record current tax payable and record/reverse deferred (DTA/DTL) based on the period’s movements.
• Log entries in the JE log with reference: source of the figure (computation/temporary differences schedule) and status of posting.

Step 3: Rollforwards + Tie-out + Tax Note Pack

• Update the Income tax payable rollforward and tie it to the GL account (Tie-out) and explain any discrepancies.
• Update the Deferred tax rollforward and link it to DTA/DTL accounts in TB.
• Compile the Tax note pack: movement tables + ETR bridge (if used) + evidence index + sign-off.

Product Components (Clear Inventory)

1. Tax Provision Summary (Current/Deferred)
   • Practical Purpose: Produce the Tax expense figure for the period with separation of current and deferred.
   • When Used: Month-End/Quarter-End provision + Year-End final.
   • Resulting Evidence: Summary clarifying the components of the tax expense and the source of each part.
2. JE Templates (Tax Expense Entry)
   • Practical Purpose: Convert the provision into transferable entries: Current tax payable + Deferred tax movement.
   • When Used: Before closing the period and after approving the provision.
   • Resulting Evidence: Ready entries with explanation/reference and linkage to accounts.
3. Income Tax Payable Rollforward
   • Practical Purpose: Explain the Tax payable balance with movements and link it to payments and the provision.
   • When Used: Monthly/Quarterly + Year-End to close the balance.
   • Resulting Evidence: Rollforward showing Opening/Provision/Payments/Adjustments/Closing.
4. Deferred Tax Rollforward (DTA/DTL)
   • Practical Purpose: Explain deferred tax movements by temporary differences or by accounts.
   • When Used: Whenever updating temporary differences or at Year-End.
   • Resulting Evidence: DTA/DTL movements linked to balances in TB.
5. TB Tie-out (Matching with Trial Balance)
   • Practical Purpose: Ensure that the final balance in the workpaper matches the TB for tax accounts.
   • When Used: Before approving the statements and before preparing the disclosure.
   • Resulting Evidence: Tie-out sheet showing the relevant accounts and any discrepancies with explanations.
6. ETR Bridge (Effective Tax Rate Bridge) — Optional
   • Practical Purpose: Explain the difference between the statutory and effective rates through reconciliation items (Permanent differences).
   • When Used: Year-End especially when preparing disclosures.
   • Resulting Evidence: ETR bridge table can be included/summarized within the Tax note.
7. Tax Note Pack (Tax Disclosure Template + Indexing)
   • Practical Purpose: Compile the movement tables and explanations necessary for preparing the tax note in the statements.
   • When Used: Quarter/Year-End when preparing the statements.
   • Resulting Evidence: Note-ready pack: tables + comparative figures + references.
8. Evidence Index + Sign-off (Evidence and Approval)
   • Practical Purpose: Establish the reference version of the provision (Version/Date) and who reviewed and approved it.
   • When Used: Before closing the period and within Year-End files.
   • Resulting Evidence: Evidence index + sign-off prevents discrepancies in provision versions within the team.

CTA related to deliverables: JE templates + payable/deferred rollforwards + tie-out to link Tax accounts to the statements and the Closing Pack.

What Should Be Included in the Delivery?

• 01 – Provision Summary: Summary of current/deferred + sources of figures for the period.
• 02 – JE Templates & JE Log: Tax expense entries (current/deferred) + posting status + supporting reference.
• 03 – TB Extract: TB/GL for tax accounts (Tax expense/Payable/DTA/DTL) for the period.
• 04 – Payable Rollforward: Movement of Income tax payable + linking payments + explaining the balance.
• 05 – Payments Proofs: Proofs of tax payments (reference/date/amount) linked to the rollforward.
• 06 – Deferred Rollforward: Movement of DTA/DTL (by account/differences) + linking to balances.
• 07 – Supporting Schedules: CIT computation or temporary differences schedule (if it is the basis of the provision).
• 08 – ETR Bridge (if used): Table of effective rate linking reconciliation items.
• 09 – Tax Note Pack: Disclosure tables + comparative figures + presentation notes.
• 10 – Evidence Index & Sign-off: Evidence index + reference version + who reviewed/approved.

After Implementation (Two Key Points)

• Operational Result for the Team: Recording the tax provision becomes “repeatable” through Summary + JE templates, with rollforward closing the balance instead of late entries each period.
• Control/Audit Result (Evidence & Traceability): Tax expense, Tax payable, and DTA/DTL have movements and explanations linked to TB, with a ready Note pack and evidence index for version sign-off.

FAQ — Questions Before Purchase

Does the product calculate CIT completely?

No. The product focuses on Provision Summary + Entries + Rollforwards + Note readiness. If you need to calculate CIT from scratch, use the CIT computation template (a separate product).

Is it suitable for IFRS?

It is suitable in terms of structure (current/deferred + rollforwards + note pack). The recognition details of deferred tax and disclosure depend on your company’s policy and your reporting framework requirements.

Can it be used monthly?

Yes, if your company operates on a monthly/quarterly provision. You will need an estimate of current tax for the period and link payments, then update rollforwards and link TB.

How does Tax payable link to payments?

Through the payable rollforward: Opening + Provision – Payments ± Adjustments = Closing, with transfer references/receipts within Payments proofs.

Does it support separate DTA/DTL?

Yes, you can track DTA and DTL separately or as a net amount depending on your presentation in TB, with rollforward and movement explanations linked to TB.

Does it produce a ready Tax Note?

The Tax note pack (movement tables/figures/linkage) is prepared to facilitate the drafting of the disclosure. The final text depends on your statement template and presentation requirements.

What is the minimum data required?

TB for tax accounts + provision/current tax estimate (from computation or estimate) + payment data + DTA/DTL balances/movements if available.

Is it suitable for multi-entity companies?

Yes, but it is preferable to have a provision file for each legal entity since Tax payable/Deferred is usually managed at the entity level, then an internal summary at the group level if needed.

Ready to Establish Tax Expense and Close Tax Accounts?

You will receive: Tax provision summary (current/deferred) + JE templates + payable/deferred rollforwards + TB tie-out + tax note pack + sign-off as a closing and documentation package.