ACCOUNTING & AUDITING ARTICLE-
F IN 4 8 Deferre d

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On October 15, 2008, the Financial Accounting Standards Board voted to defer FIN 48 for the second time for private companies.  The new effective date for implementation will be for fiscal years beginning after December 15, 2008.

FIN 48 clarifies the accounting for uncertainty in income taxes recognized in financial statements in accordance with FASB Statement 109, Accounting for Income Taxes.  The interpretation provides a recognition threshold and a measurement attribute for the recognition and measurement of a tax position taken or expected to be taken in a tax return. 

The recognition threshold requires the organization to determine whether it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation process, based on the technical merits of the position.  Once the more likely than not threshold has been met, the tax position is then measured to determine the amount of benefit to recognize in the financial statements.  The measurement attribute requires the organization to measure the tax position at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement.

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