Tuesday, June 18, 2019
Popping the Lid on Smuckers’ Goodwill

Tuesday, June 11, 2019
Not Much Fizz in LaCroix Right Now

Wednesday, May 29, 2019
An Example of Calcbench, Excel, and Insight

Monday, May 20, 2019
Research Paper: Capex Spending

Thursday, May 16, 2019
Psst: Got Any Weed?

Wednesday, May 15, 2019
Open Letter: SEC Proposed Rule for BDCs

Friday, May 10, 2019
General Motors and Workhorse

Monday, May 6, 2019
How to Find Earnings Release Data

Tuesday, April 23, 2019
Following Restructuring Costs Over Time

Monday, April 22, 2019
Capex Spending: More Than You Might Think

Saturday, April 13, 2019
When AWS Takes Over the World

Thursday, April 11, 2019
Data Trends in Focus: Restructuring Costs

Sunday, April 7, 2019
How One Customer Crushed It With Calcbench

Thursday, April 4, 2019
TJX Shows Complexity of Leasing Costs Reporting

Tuesday, April 2, 2019
CEO Pay Ratios: Some 2018 Thoughts

Wednesday, March 27, 2019
Corporate Spending: Where It Goes, 2017 vs. 2018

Monday, March 25, 2019
Health Insurers: A Bit Winded?

Friday, March 22, 2019
Our New Master Class Video

Thursday, March 21, 2019
Tech Data’s Goodwill Adjustment

Tuesday, March 19, 2019
There’s Taxes, and There’s Taxes

Archive  |  Search:
Tax Reform Disclosures: Five Examples
Wednesday, January 24, 2018

As corporations continue to file their first wave of financial statements after passage of tax reform in late December, we decided to take a peek at what disclosures they’re making about the law’s likely effects for them…

  • Amcon Distributing said on Jan. 18 that the new corporate tax rate of 21 percent will lead to a $900,000 tax benefit in first quarter 2018. That benefit comes from applying the 21 percent rate to long-term tax deferred liabilities on the firm’s balance sheet.
  • Agribusiness CHS Inc. said on Jan. 10 that it is still studying the consequences of tax reform, and “we expect to record a material tax benefit due to the revaluation of our net deferred tax liability position,” although CHS declined to estimate what that benefit might be.
  • That’s more than we can say for Nike. On Jan. 5, Nike said it expects to incur a material additional income tax expense, primarily related to the transition tax on accumulated foreign earnings, the repeal of foreign tax credits, and the remeasurement of certain deferred tax assets and liabilities.
  • Cal-Maine Foods published an earnings release Jan. 5 saying the new tax rate would be applied to a deferred tax liability of $75.3 million it has on the books, which will result in a smaller liability and therefore a benefit to income tax expense.
  • On the other hand, SuperValu said on Jan. 10 that it will take a non-cash charge of $35 million to $45 million to reduce the value of deferred tax assets it’s carrying.

You get the idea: most companies talking about tax reform so far have been disclosing changes to the value of deferred tax assets or liabilities. We saw an early wave of similar disclosures at the end of December, as large banks disclosed short-term charges for the fourth quarter that sometimes reached into the billions.

Those are the short-term effects of tax reform. Over the long term, companies should, presumably, start reporting larger net income and lower effective tax rates, as the one-time adjustments of tax assets recede and the permanent lower rates take hold.

Calcbench subscribers can always monitor what companies disclose about tax reform by using the Interactive Disclosures page. Just set the company (or companies) you want to research, and enter “tax reform” or some similar term in the text search box on the right-hand side. Then feast on the results.

FREE Calcbench Premium
Two Week Trial

Research Financial & Accounting Data Like Never Before. More features and try our Excel add-in. Sign up now to try the Premium Suite.