for the year ended 31 December 2016
NOTES TO THE
FINANCIAL STATEMENTS
Annual Report 2016
-
100
-
2.
Summaryofsignificantaccountingpolicies (cont’d)
2.18
Taxes
(a)
Current income tax
Current income tax assets and liabilities for the current and prior periods aremeasured at the amount
expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to
compute the amount are those that are enacted or substantively enacted at the end of the reporting
period, in the countrieswhere theGroup operates and generates taxable income.
Current income taxes are recognised in the profit or loss except to the extent that the tax relates to
items recognised outside profit or loss, either in other comprehensive income or directly in equity.
Managementperiodicallyevaluatespositions taken in the tax returnswith respect tosituations inwhich
applicable tax regulations are subject to interpretation and establishes provisionswhere appropriate.
(b)
Deferred tax
Deferred tax isprovidedusing the liabilitymethodon temporarydifferences at theendof the reporting
periodbetween the taxbases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all temporary differences, except:
– Where the deferred tax liability arises from the initial recognitionof goodwill or of an asset or
liability in a transaction that is not a business combination and, at the time of the transaction,
affects neither the accounting profit nor taxable profit or loss; and
– In respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, where the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differenceswill not reverse
in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused
tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available
against which the deductible temporary differences, and the carry forward of unused tax credits and
unused tax losses can be utilised except:
– Where the deferred tax asset relating to the deductible temporary difference arises from the
initial recognitionof anasset or liability ina transaction that isnot abusiness combinationand,
at the timeof the transaction, affectsneither theaccountingprofit nor taxableprofit or loss; and
– In respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are recognised only to the extent
that it is probable that the temporary differences will reverse in the foreseeable future and
taxable profitwill be available againstwhich the temporary differences can be utilised.
