Facebook (FB, Tech30) disclosed on Thursday that it could owe billions due to an IRS investigation into the way it moved assets to an Irish subsidiary to avoid higher taxes.
The IRS tax penalty could total $3 billion to $5 billion, plus interest, according to a Facebook filing with the Securities and Exchange Commission. If so, Facebook says the penalty could have a "material adverse impact" on its financial position.
The tax issue was first disclosed publicly three weeks ago when the U.S. Justice Department filed a lawsuit forcing Facebook to comply with the ongoing IRS investigation. No figures were provided at the time for possible penalties. Source: Facebook could owe $5 billion in taxes - Jul. 29, 2016
(Also) Apple’s, Google's and Coca Cola’s tax assessments are material from an annual report perspective besides financial risks contain reputational risks. See for overview of these tax assessments
- Will ‘tax assurance’ mandatory be reviewed by External and Internal Auditors?
- How does it change the CFO and position of the head of tax (budget, resources, qualifications, etc.)?
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