Extract to table

If the recognition threshold is met in Step 1, the entity must then measure the amount of tax benefit to be recognized in its financial statements

Tax positions that fail the more-likely-than-not recognition threshold in Step 1 must be fully reserved (i

Furthermore, under ASC 740-10, the entity must presume that the position will be examined by a taxing authority with full knowledge of all relevant information

The tax impact of any proposed adjustment must be computed using the applicable federal corporate income tax rate for each examination year

The measurement must account for the interrelationship between the CSA and royalty positions, including the potential for correlative adjustments under Treasury Regulation § 1

However, the risk that the IRS will use the PCT undervaluation theory to support adjustments to the ongoing CSA cost-sharing ratios and royalty rates for the examination years is real and must be accounted for