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LOSS CARRYFORWARD

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offsetting the current year's net operating loss against future years' (currently 20 years) net incomes for tax purposes, assuming that a LOSS CARRYBACK is not possible in whole or in part. For financial reporting purposes, the tax effects of a loss carry-forward should not be recognized until the year in which the tax liability is reduced unless earlier realization is assured beyond any reasonable doubt. This assurance is indicated when the entity has been profitable, future earnings are assured, and the loss results from a non-recurring event.