Deferred Taxes

There have been a number of companies that either have had to restate earnings as a result of deferred tax problems or stated that accounting controls can not be relied on due to problems with deferred tax accounting. Today Tasty Baking stated that the reason it done the following to improve its internal controls over deferred taxes:

To improve control of the way it accounts for income taxes, the company said it has implemented additional monitoring controls and has documented the methodology and tools for calculating and reporting tax-related transactions.

In addition, Con Agra stated that it would restate earnings due to income tax errors:


ConAgra Foods Inc. said it would restate its financial results for 2004 and the first half of fiscal 2005 because of income tax errors that could cost one of the nation’s largest food companies up to $200 million.

I wonder if this is the start of the next wave of restatements.