SEC 10-K Analysis
SEC 10-K Analysis
Using the SEC 10-K for Ford Motor Company for the year ending December 31, 2017, the sections of recent income tax and deferred income tax are identified in Note 7. This purpose of this analysis is to recognize current and deferred income taxes, classifications of both, long-term portion of the deferred taxes.
Current and Deferred Income Taxes
Ford deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences that exist between the financial statement carrying value of assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards on taxing jurisdiction basis. Ford measures deferred tax assets and liabilities using enacted tax rates that will apply in the years in which they expect the temporary differences to be recovered or paid, identified in Note 7 of the SEC 10-K annual report (Ford Motor Company, 2018).
Current income tax and deferred income tax expense about pretax income from continuing operations, income tax expense may include interest and penalties on tax uncertainties based on Ford’s SEC 10-K. Based on the 2018 SEC 10-K annual report Ford had a current income tax amount of $828 million which was an increase of $308 million (Ford Motor Company, 2018).
Current and Long-Term Portion of Deferred Taxes
As of December 31, 2017 $5.9 billion of non-U.S. earnings are considered indefinitely reinvested in operations outside the United States, for which deferred taxes have not been provided. Ford’s Note 7 also maintains that the 2016 tax provision includes a $300 million benefit for the recognition of deferred taxes resulting from a 2016 change in the U.S. tax law related to the taxation of foreign currency gains and losses for our non-U.S. branch operation (Ford Motor Company, 2018).
The valuation allowance of $1.5 billion primarily related to deferred tax assets in various non-U.S. operations. Deferred tax assets for net operating losses and other temporary difference related to certain non-U.S. operations have not been recorded as a result of elections to tax these operations simultaneously in U.S. tax returns. Reversal of these elections would result in the recognition of $8.3 billion of deferred tax assets, subject to valuation allowance testing (Ford Motor Company, 2018).
Using the SEC 10-K annual report for Ford Motor Company, provides the current and deferred income taxes and the items that would affect both those classifications. Additionally, gives details of the current and long-term portion of the deferred taxes for Ford Motor Company on Note 7.
Ford Motor Company. (2018). 2017 10-K from. Retrieved from http://d18rn0p25nwr6d.cloudfront.net/CIK-0000037996/fb064654-36a4-456d-b846-3f00c93a670d.pdf