France enacted legislation in December 2012 to encourage investment and create jobs. The legislation grants companies a tax credit for qualifying salaries. The credit is equal to 4% of salaries paid for financial year 2013 and increases to 6 % for financial year 2014. During March 2013, the French tax authorities provided guidance on this “wage tax credit” (crédit d’impôt pour la compétivité et l’emploi or “CICE”) explained in further detail below. Organizations with operations in France will need to consider the impact of the new legislation on their financial statement accounting under either US Generally Accepted Accounting Principles (US GAAP), International Financial Reporting Standards (IFRS), or French Generally Accepted Accounting Principles (French GAAP). Under US GAAP and IFRS, the credit is recognized and measured as a component of pre-tax income. Under French GAAP there is a choice to account for the credit either as a component of pre-tax income or as a component of income tax expense.