timing difference

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Timing Difference

In accounting, the amount of time between the point at which an asset or transaction affects a company's finances for reporting purposes and the point at which it affects it for tax purposes. This is especially important in depreciation: tax depreciation and reporting depreciation are sometimes calculated differently.

timing difference

The time difference between the point at which a transaction affects items for financial reporting purposes and the point at which it affects the same items for tax purposes. For example, purchase of a fixed asset depreciated by an accelerated method for tax purposes, but by straight-line for reporting purposes, creates a timing difference for depreciation expense.
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Cellcom Israel announced that the Israeli Tax Authority issued a best judgment assessment for 2014 to the company, generally due to timing differences. According to the assessment, if the company's claims are rejected, the company will be required to pay additional income tax in relation to the year 2014, in an amount of approximately NIS 56 million, including interest and Israeli CPI differences.
Adjusting for timing differences on major events, consolidated revenue was up by 5.4% compared to Q1 2013.
The fall is attributed to timing differences in orders and invoicing, with the company bullish that sales will pick up in the last quarter.
These timing differences, if related to a specific asset, will cause the asset to have a basis for AMT purposes that differs from that for regular tax purposes.
Additionally, because REITs generally do not reduce dividend payments for fear of damaging shareholder value, they often do not do this when the timing differences in depreciation and loan principal payments turn around.
Also, many companies do not have a line of credit that can be used to meet cash flow timing differences, such as seasonal inventory buildup or taking advantage of vendor discounts.
On our last cycles, we set materiality numbers for timing differences. For rollover effects within the audit cycle (e.g., 1998 adjustment reversing in 1999), we agreed on a number below which timing difference would not be pursued.
Exclusion preferences, such as state and local income taxes, real estate taxes, and allowable miscellaneous itemized deductions, are not caused by timing differences and yield no IRC section 53 benefit by themselves.
You need to make several adjustments to the premium savings element, such as cash flow and tax timing differences, to accurately calculate returns and compare alternatives.
Netflix said in its quarterly letter to investors: "Free cash flow in Q1 was -$287 million, less negative than we expected due to content payment timing differences, compared with -$524 million in Q4'17.