Income Taxes Income taxes have been provided in accordance with the provisions of FASB ASC Topic Income Taxes . Deferred tax assets and liabilities result from temporary differences between the amounts recorded in our consolidated financial statements and the tax basis of our assets and liabilities. Such temporary differences are primarily due to net operating loss carryforwards and GAAP versus tax basis accounting differences relating to unearned premiums, reserves for claims and claim expenses, deferred finance charges, deferred underwriting results, accrued expenses, investments, deferred acquisition expenses, intangible assets, amortization and depreciation and 0OBA. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period in which the change in tax rates is enacted. A valuation allowance against net deferred tax assets is recorded if it is more likely than not that all, or some portion, of the benefits related to deferred tax assets will not be realized. At December 31, 2021, our net deferred tax asset (prior to our valuation allowance) and valuation allowance were 192.4 million ( 2020 - 13.0 million) and 131.5 million ( 2020 - .7 million), respectively. See “(ote 15. Taxation” in our “(otes to the Consolidated Financial Statements” for additional information. At each balance sheet date, we assess the need to establish a valuation allowance that reduces the net deferred tax asset when it is more likely than not that all, or some portion, of the net deferred tax assets will not be realized. The valuation allowance assessment is performed separately in each taxable jurisdiction based on all available information including projections of future GAAP taxable income from each tax-paying component in each tax jurisdiction. The valuation allowance relates to a substantial portion of our net deferred tax assets in most jurisdictions in which we do business. It excludes Bermuda and our U.S. operations that existed prior to the acquisition of TMR, which only have a small valuation allowance against finite lived tax carryforwards. We have unrecognized tax benefits of (il as of December 31, 2021 ( 2020 - (il). Interest and penalties related to unrecognized tax benefits, would be recognized in income tax expense. At December 31, 2021, interest and penalties accrued on unrecognized tax benefits were (il ( 2020 - (il). The following filed income tax returns are open for examination with the applicable tax authorities tax years 201 through 2020 with the IRS 2017 through 2020 with Ireland 2019 through 2020 with the U.%. 2017 through 2020 with Singapore 2019 and 2020 with Switzerland and 2017 through 2020 with Australia. We do not expect the resolution of these open years to have a significant impact on our consolidated statements of operations and financial condition. 70