deferred tax liabilities treatment for analysis purposes

[cnd]

DTL that are expected never to reverse: treat as equity for analysis purposes
DTL that are expected to reverse: treat as liabilities for analysis purposes, but at present value

Question: why not treat the former as equity for analysis purposes, but also at present value?

 

[maratikus]

I think DTL - PresentValue of DTL will be added to equity for analysis purposes

 

[FisherSU]

I believe that DTL expected never to reverse are already at the present value. In the case of reversible DTL u have an estimated future date of reversal to use in discounting. Thus, DTL expected to reverse is valued at PV for analysis purposes and undiscounted for accounting purposes. The difference is treated as equity (effective savings of postponing immediate tax payments belong to company owners).

Hope this helps.