RE:Deferred Income Tax: Actual items causing thishttps://www.investopedia.com/ask/answers/052915/what-are-some-examples-deferred-tax-liability.asp What are some examples of a deferred tax liability?
"One common situation that gives rise to deferred tax liability is
depreciation of fixed assets."
ts9222 wrote: After all this time people can't figure out what this is?
Instead of talking about the theoretical definition of deferred income tax, ask what are the actual items in practice that is causing this.
The items causing this is what they are depreciating.
Deferred tax liabilities
Mining interests (48,634)
Long-term debt (20,615)
Section 13 of the financial statement clearly gives a breakdown of their deferred tax assets and liabilities. Subtract their tax assets from liabilities and you get the net.
This is non-cash. This is not cash that is due to the government.
Many miners depreciate their mining assets over the life of mine. Its purpose is to reduce the amount of tax that needs to be paid. Depreciation reduces earnings, and with lower earnings, there is less tax to pay. It is the DA of EBITDA. In future years if the mining asset is depreciated to 0, it just means there is 0 left to subtract from earnings. This is only relevant if a company makes a profit.
It just shows GCM earnings are understated from this depreciation. They are generating more cash than their stated earnings.
For their Long-term debt
There is a non-cash increase to Finance costs which also reduces their net income.
"Non-cash accretion of the debt discount on the Senior Debentures - $19.2 million in the full year 2016 compared with $Nil in 2015. The total debt discount of approximately $100.0 million is being accreted to the carrying values of the Senior Debentures over the remaining terms of the debentures using the amortized cost approach."
First people thank me for answering their questions, then they say they are not interested in reading my posts, then ReverseSplitIdiots put single star ratings on every one of my posts regardless of content. If people don't want me to post, i'm not going to waste my time posting. Some people just like fake news more than the truth.