___________ reserves for income tax purposes are referred to as maximum tax actuarial reserves (MTAR) and replace the actuarial liabilities used for accounting purposes in computing taxable income.
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A. B. C. D.B
The correct answer is D. None of the above.
Maximum tax actuarial reserves (MTAR) are reserves that are established for income tax purposes to replace the actuarial liabilities used for accounting purposes in computing taxable income. These reserves are not related to procedures, policies, or standards. Instead, they are used to comply with tax regulations and to ensure that the company's taxable income is properly calculated.
The purpose of MTAR is to ensure that companies pay taxes on their actual income, rather than on their actuarial liabilities, which can be significantly different from their actual income. The MTAR represents the amount of money that the company expects to pay in future claims and benefits, based on actuarial assumptions and experience.
The calculation of MTAR is subject to specific rules and regulations, which are established by tax authorities. Companies must comply with these rules to ensure that their tax calculations are accurate and acceptable to tax authorities.
In summary, MTAR are reserves that are established for income tax purposes to replace the actuarial liabilities used for accounting purposes in computing taxable income. These reserves are not related to procedures, policies, or standards, but rather are used to comply with tax regulations and ensure that the company's taxable income is properly calculated.