The effect of tax reporting in financial reporting

• Author: Shqipe Xhaferri, Albana Demi (Mosho)
• Position: Lecturer, University 'Aleksander Moisiu' Durrës, Albania - Head of CIRD Economy, Canadian Institute Of Technology
• Pages: 173-178

ISSN 2410-3918 Academic Journal of Business, Administration, Law and Social Sciences Vol 1 No 2

Acces online at www.iipccl.org IIPCCL Publishing, Tirana-Albania July 2015

173

e eect of tax reporting in nancial reporting

Dr. Shqipe Xhaferri

Lecturer, University “Aleksander Moisiu” Durrës, Albania

Dr. Albana Demi (Mosho)

Head of CIRD Economy, Canadian Institute Of Technology

Abstract

is paper analyzes the importance of building nancial statements and their compliance with

the activities by running an entity, primarily for micro units. Main objective of this paper is to

present the necessity of the implementation of legal frameworks in the eld of accounting and

the application of accounting standards for nancial reporting. National Accounting Standards

are signicant factors to increase the quality of nancial information, bringing new technologies,

increased competition and culture of service etc. National Accounting Standards help in the

sustainable economic development of the country and integration into the EU. is paper

analyzes a series of articles in the eld of research in the eld of accounting. is paper presents

the theoretical and practical aspects of a company’s long-term assets, treating the amortization

calculated according to accounting standards. An important point is the appearance of these

items in the balance sheet. According to the empirical viewpoint, various studies give dierent

results. Also, the entities as a primary source of economic development are part of this paper. e

application of accounting standards began in Albania on 1 January 2009.

From these date all the units are obliged to draw up nancial statements according to national and

international standards of accounting. Actually nowadays (starting from the scal year 2014) the

submission of balance sheet is made electronically.

Keywords: Financial statements, balance sheet, Prot tax, nancial report, national accounting

standards.

Introduction

One of the main users of nancial statements is information of tax authorities. e

necessity to use the nancial statements of entities derived mainly from the necessity

of calculating the share of income tax to be paid to state bodies. Albania implements

“code law”, where accounting standards and nancial reporting for taxation purposes are

regulated by law. e amortization that is calculated beyond the allowed limits by tax

constitutes a non deductible element expenditure. In order to analyze and certify the tax

reporting material that eects the nancial reporting we have to consider the calculation

of amortization and scal accounting and analyze the dierence between them and its

eect on net income through testing the following hypotheses:

• Fiscal Amortization = Accounting Amortization

• Fiscal Amortization ≠ Accounting Amortization