Tax Effect Accounting - Fund Details; Reporting Setup

Can any one please help me understand the relevance or reasons for selecting the check box “Tax Effect Accounting” in the "Fund Details/Reporting. (screen clip attached)
Thank you
Tax%20Effect%20Accounting

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Hi @Rustie, welcome to the community!

Some SMSFs may use “Tax Effect Accounting” which means that the Deferred Tax Liability/Asset account (Account code 89000) will be activated in Simple Fund 360. If this box is checked, Simple Fund 360 will automatically allocate amounts to this account during the create entries process.

Whether the box should be checked depends on if the fund is using Tax Effect Accounting. If you’re performing opening balances for a fund, this can be determined normally by the presence of a balance sheet line item named “Deferred Tax Liability / Asset (DTA/L)” or “Provision for Deferred Income Tax (PDIT) / Future Income Tax Benefit (FITB)”

See here for more details:

Hopefully that helps

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