The pace of tax reform talk in Congress merits the careful attention of every public company preparer because it could lead to a scramble in year-end financial reporting.

Regardless of when the various provisions of any new tax rules might take effect, GAAP requires companies to report the effects of those provisions in the period they are enacted. That means if new tax law is passed before 2017 ends, companies must be prepared to report the expected effects of that new law in their 2017 year-end financial statements.

Grant Thornton is sufficiently concerned that it’s alerting public companies to tune in closely to the tax reform proposals floated both in the House of Representatives and the Senate and consider how the common themes might affect them. In the firm’s view, the likelihood is growing that tax reform legislation could be signed into law before the end of the year.

The expected effects could be numerous and varied, based on the proposals that have been offered in both chambers. “The proposals set forth thus far would change or introduce a number of major statutory provisions and would significantly alter the taxation of U.S.-based multinationals and foreign-invested U.S. entities,” Grant Thornton says in its advisory. “Given the multitude of changes and expiring benefits, companies should be actively evaluating how most effectively to calculate, manage, and disclose the overall impact.”

Grant Thornton acknowledges the bills are changing and exact provisions are uncertain. Yet there are areas with enough consensus that companies should be paying attention to them and thinking about how they’ll be affected. The firm lists six tax reporting areas that companies should be focused on to prepare themselves for the possibility of year-end reporting:

Deferred tax balances — If the corporate tax rate is reduced, deferred tax assets and deferred tax liabilities would be need to be remeasured. Under the House bill, corporate deferred tax balances would generally be recalculated at the expected reduced rate of 20 percent as of the beginning of 2017, Grant Thornton says. The Senate bill as proposed is different, however; some portion of deferred balances could be remeasured at 20 percent, but some would remain at the current rate of 35 percent.

Repatriation — Companies may need to calculate a tax liability for the deemed repatriation of certain foreign earnings based on how they might repatriate any such earnings. It could apply to foreign tax credits as well, all depending on the final provisions of the final rules.

Valuation Allowances — Some tax attributes like net operating losses, carryforwards, and tax credits will likely need to be evaluated for valuation allowances.

Foreign Corporations — The U.S. taxation of controlled foreign corporations could be affected by new international provisions, so that should be considered in the context of reporting undistributed earnings of those subsidiaries.

Sunset Provisions — Any areas in the new law that would allow current rules to expire or terminate without new action should be considered in the context of deferred tax balances.

Basis Differences — Companies need to take a look at their investments in foreign subsidiaries and consider any differences between the amounts reported for tax purposes and financial reporting purposes to determine whether they may need to recognize liabilities.

“Business leaders should begin immediately to catalog the ways in which potential changes may impact their businesses,” Grant Thornton advises. “Changes to deferred tax assets and liabilities are anticipated to be especially significant.”