21/8/2008

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Using the Tax Index of Financial Data   TIFD guide   Structure & Design   The TIFD consists of items you find on a balance sheet, income statement and the statement of retained earnings. A complete listing of TIFD items and their codes is included in Appendix 1. The balance sheet section consists of items pertaining to assets, liabilities, and shareholder equity. Each section is further subdivided into sub-sections:   Assets      Liabilities      Shareholder Equity      Select the items usually reported on your balance sheet from the item range 1000 to 3999. The income statement section consists of items you find under revenue, cost of sales, and operating expenditure to derive the net income or loss on ordinary activities before tax. Revenue Sale of goods and rendering of services Income from investments Commission income Rental income Amounts received by non-profit making organisations Ralised gains / losses on disposal of fixed assets   Cost of Sales Opening stock Purchases Direct costs Closing stock   Operating Expenditure Advertising and promotion Wages, salaries and employee benefit Sub contracting and out-sourcing Travel expenses Insurance Office expenses Professional Fees Licences, permits and membership Rental Repairs and maintenance Supplies Utilities Interest and bank charges Provisions Amortisation of intangible assets Depreciation of immovable property Depreciation of wasting assets Depreciation of tangible assets Other Expenses   NET INCOME / LOSS ON ORDINARY ACTIVITIES BEFORE TAX   The income statement also accounts for tax provision(s) and extraordinary items. Tax Provisions Current tax provision Deferred tax provision   Exraordinary, Exceptional & Unusual items Select the items usually reported on your income statement from the item range 5000 to 7499. This leads to the statement of retained earnings... NET INCOME / LOSS FOR THE PERIOD   RETAINED EARNINGS BROUGHT FORWARD   Appropriation Dividends proposed during the year Dividends proposed and paid during the year Transfer to General Reserve Transfer to Revenue Reserve Transfer to Capital Reserve Transfer to the Incentives and Benefits Reserve [BPA] Transfer to Other Reserve(s) Select the items usually reported on your statement of retained earnings from the item range 7500 to 7600.  A complete listing of TIFD items and their codes is included in Appendix I   TIFD guide   How to Select TIFD Items The TIFD is divided into sections and each section is further sub-divided into blocks of items. The sequential numbering identifies each block. The item at the start of each block is bold written and represents the generic code for the group of items included in the same block. It also includes eight mandatory fields and a number of subtotals. The exact match from the TIFD must always be selected. If there is no exact match, select the most appropriate description. The general coded item must only be used in the absence of an appropriate or suitable description within the index. Assuming that you will prepare the TIFD from your own financial statements, use the following process when you select TIFD items: Try to select an exact match from the TIFD to items on your financial statements. If you cannot find an exact match, select the most suitable item. If you cannot find a suitable item, select the generic item. A financial statement item may represent two or more TIFD items. In such instances determine the greatest amount of the grouped component and report under the most appropriate TIFD item describing it. Note that the general coded item at the start of each block is not a sub-total of the items within the same block. There are specific codes for sub-totals within the TIFD. [See Subtotals within TIFD below].   TIFD guide   Reporting Negative Amounts Any negative amounts must be indicated by brackets () or the minus sign "-". TIFD guide   Reporting the Money Value Irrespective of Currency Denomination Report your financial statement amounts in full, not rounded in thousands (000s) or millions (000,000s). Report the whole value of the currency amount, excluding decimals [e.g. do not report cents in the case of the Maltese Lira]. TIFD guide   Group Reporting Remember to report your financial statement information on a legal entity (unconsolidated) basis as you do today. TIFD guide   Mandatory Items The TIFD information has to balance and therefore certain rules must be followed to verify the information that is received. A few mandatory items are included to validate the accuracy, completeness and integrity of the information that is transmitted. Where there is nothing to report under a mandatory field, a zero "0", has to be entered. You have to provide certain line items so that we can verify the following equations: total assets = total liabilities + total shareholder equity total revenue - total expenses = net income on ordinary activities retained earnings carried forward (item code 7600) in the statement of retained earnings = retained earnings (item code 3905) in the balance sheet - this validation links the income statement to the balance sheet. net income or loss on ordinary activities before tax (item code 7050) = field 1a in the company tax return - this final validation ensures that the financial statement information transmitted connects to the company filing the return. Therefore, each set of financial statements must include the following required items: Mandatory Balance Sheet Items 2299 Total Assets 3799 Total Liabilities 3998 Total Shareholder Equity   Mandatory Income Statement Items 5499 Total Revenue 5998 Cost of Sales 6997 Total Operating Expenses 7050 Net Income / (Loss) on Ordinary Activities Before Tax   Mandatory Item in the Statement of Retained Earnings 7600 Retained Earnings Carried Forward These mandatory fields do not represent the minimum number of items that need to be TIFD-coded and filed with the IRD. These are codes that must be included, along with all the other TIFD codes needed to represent a company's financial statements.  Appendix II Sets out a comprehensive example on how to use and apply the TIFD   TIFD guide   Subtotals Within the TIFD   TIFD Code  Description  Balance Sheet 1198 1199 1698 1699 1998 1999 2298  Total intangible assets  Total accumulated amortisation of intangible assets  Total tangible assets  Total accumulated depreciation of tangible assets  Total long-term assets  Total fixed assets  Total current assets   2299  Total Assets  Mandatory 3499 3798  Total current liabilities  Total long term liabilities   3799  Total Liabilities  Mandatory 3890 3950  Total capital  Total reserves   3998  Total Shareholder Equity  Mandatory 3999  Total liabilities and shareholder equity    Income Statement & Statement of Retained Earnings 5099 5498  Total sales of goods and services  Total revenue from other sources   5499 5998  Total Revenue  Cost of Sales  Mandatory  Mandatory 5999  Gross profit / (loss)   6997  Total Operating Expenses  Mandatory 6998  Total Expenses   7050  Net Income / (Loss) on Ordinary Activities Before Tax  Mandatory 7500  Net income / (loss) for then period   7600  Retained Earnings Carried Forward  Mandatory       The mandatory subtotals are always required in order to validate the accuracy of the data transmitted. The other subtotals are primarily intended to support manual filers who would need TIFD codes for their financial statement presentation. Subtotals should not be mixed up with the generic items. Consider the case where your accounts include a class of reserves that are not mentioned in the TIFD. In the absence of a suitable code, the value should be entered under the generic item code 3900 - Reserves. The sum total of item codes 3900 to 3906 is then reported as a subtotal in item code 3950 - Total reserves. This particular subtotal is not a mandatory item. Nevertheless, it is advisable that you make full use of the TIFD coded subtotals that serve as a check on the data reported. TIFD guide   Reporting Multiple Lines of Business A number of companies receive income from different sources and file supplementary income statements for each operation. The TIFD should be used to report information from these supplementary statements distinct from the main income statement. When completing a main income statement supported by supplementary statements the following reporting criteria should be observed: the name of the operating establishment must be provided for each statement - Item 4500 a brief description of the operation is required on each statement - Item 4501 each statement must be differentiated by a sequence number - Item 4502. The main income statement must be denoted as 01 and the supplementary statements numbered consecutively from 02 a TIFD item can be reported on more than one statement ensuring that amounts reported on one statement are not included on another each income statement should include items within the code range 5000 [Sale of goods and rendering of services] to 7050 [Net Income or loss on ordinary activities before tax] ensure that the main income statement does not include any amounts reported in the supplementary statements a summary statement is required reporting: the sum total of the amounts in Item 7050 [Net Income or Loss on ordinary activities before tax] on each income statement the current tax provision [Item 7060] if any the deferred tax provision [Item 7080] if any any extraordinary, exceptional and unusual items etc [Items 7200 to 7207] the statement of retained earnings [Items 7500 to 7600]  Appendix III Sets out an example on TIFD reporting in the case of multiple lines of business. TIFD guide   Reporting an Amount That Combines Two or More Items An amount in your financial statement information may combine two or more TIFD items. To report this amount, determine which item is the greater/greatest amount and choose the most appropriate TIFD item.  Example: `A Company incurred €2,100 as advertising and promotion.`   Two situations are now considered.   In the first situation, €2,000 has been recorded as advertising and €100 has been entered as promotion in   the company's books.   There is an exact match for Advertising and for Promotion in the TIFD listing. TIFD Code 6000 6001 6002 Item Description Advertising and promotion Advertising Promotion   In this case you choose the exact TIFD code that matches each item: TIFD Code 6001 6002 Item Description Advertising Promotion Amount 2,000 100   This is what you get when the data is filed electronically with the return: 6001 6002 2000 100  In the second instance the company recorded €2,100 as advertising and promotion in its books of account.  It is known that the expense is mostly made up of advertising. The company may either use:  a) The Generic Code TIFD Code 6000 Item Description Advertising and Promotion Amount 2,100   In which case the accounting data filed electronically with the return would read: 6000 2100 or  b) the coded item known to represent the highest amount TIFD Code 6001 Item Description Advertising Amount 2,100   In this case the accounting data filed electronically with the return would read: 6001 2100 TIFD guide   Notes to the Financial Statements If you intend to file a paper copy of the return and financial statements you must also apply the TIFD code to the notes to the financial statements. If you file electronically, the TIFD transmission will include the breakdowns normally disclosed by way of a note.  Example:  Your balance sheet shows fixed assets in the amount of €101,258 with a breakdown disclosed by way of a note.  Balance Sheet Extract Fixed Assets Cost [€] Dep`n to date [€] Net [€] Land and Buildings 85,000 0 85,000 Motor Vehicles 18,350 7,340 11,010 Furniture and Fittings 4,950 990 3,960 Office Machinery and Equipment 3,220 1,932 1,288 Total 111,520 10,262 101,258  Using the TIFD, you report the information from the notes as follows: TIFD Code Item Description Amount 1200 Land and Buildings 85,000 1352 Motor Vehicles 18,350 1353 Accumulated depreciation of motor vehicles (7,340) 1393 Furniture, fixtures, fittings and soft furnishings 4,950 1394 Accumulated depreciation of furniture, fixtures, fittings and soft furnishings (990) 1397 Other machinery 3,220 1398 Accumulated depreciation of other machinery (1,932) 1698 Total Tangible Assets 111,520 1699 Total accumulated depreciation of tangible assets (10,262) See Appendix II for a comprehensive example on the application of the TIFD when paper copies of the financial statements, including notes, are filed.

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