11. Internation financial reporting standards (IFRS)

11.1. Valuation allowances

Under U.S. GAAP, companies recognize deferred tax assets and then reduce those assets with an offsetting valuation allowance if it is “more likely than not” that the asset will not be realized. In contrast, under IFRS, deferred tax assets only are recognized to begin with if it is probable (defined as “more likely than not") that they will be realized. That means that we could see more deferred tax assets and offsetting valuation allowances under U.S. GAAP than how the same company would appear under IFRS.