What do deferred tax liabilities represent?

Deferred tax liabilities arise from taxable temporary differences, which are discrepancies between the accounting treatment of certain items and their treatment for tax purposes. Essentially, when a company's financial reporting reflects income that is not yet taxable, this can create a situation where the company will owe taxes in the future when that income is recognized for tax purposes.

The concept of deferred tax liabilities is rooted in the matching principle of accounting, which states that income and expenses should be recorded in the same period when they are incurred. Consequently, when a company recognizes income on its financial statements but is permitted to postpone the tax expense to a later period, this creates a liability for the future tax payment owed.

In this context, the other options do not accurately describe deferred tax liabilities. For instance, deferred tax assets relate to future tax recoveries, which is not the case with deferred tax liabilities. Also, while unutilized tax credits and accounting provisions for future expenses are important aspects of tax and financial reporting, they do not define deferred tax liabilities.

Thus, the correct identification of deferred tax liabilities as future tax payments due to taxable temporary differences accurately captures their nature and significance in corporate reporting.