Daffodil International University
Faculties and Departments => Business & Entrepreneurship => Business Administration => Topic started by: munna99185 on April 03, 2014, 01:07:44 PM
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Loss carryback is an accounting technique with which a company retroactively applies net operating losses to a preceding year's income in order to reduce tax liabilities present in that previous year. Loss carrybacks are similar to loss carryforwards, except companies apply their net operating losses to preceding rather than subsequent years' incomes. GAAP stipulates that a loss carryback can be applied only to the three years preceding the loss. For instance if a company were to record a net operating loss in year five, the company could apply a loss carryback to any of years two to four.
[Source:http://www.investopedia.com]
Sayed Farrukh Ahmed
Assistant Professor
Faculty of Business & Economics
Daffodil International University