A Research on Deferred Taxes: A Case Study of BIST Listed Banks in Turkey

Abstract

This study attempts to investigate the general profile and drivers of the deferred tax assets and liabilities of sixteen banks listed in Borsa Istanbul (BIST). The issue of deferred taxes is regulated by Turkish Accounting Standard No-12 (TAS-12), which is a verbatim Turkish translation of the International Accounting Standard (IAS) of the same number. The article discusses deferred taxes by establishing a link between them and temporary differences. Based on the examination of the annual financial statements of sixteen BIST-listed banks for the period of 2005-2013, it is found that the banks have generally reported deferred tax assets. The analysis of the financial statements of 2013 revealed that “severance payment rights” is the leading cause for deferred tax assets whereas the primary factor for deferred tax liabilities is the “valuation of financial assets”.

Keywords: IAS-12, TAS-12, Banks, BIST, Temporary Differences, Deferred Tax Assets, Deferred Tax Liabilities.