Consolidated Profit And Loss Account Page 13
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48NOTES TO THE ACCOUNTS
(iii)
Dividend income from listed investments is recognised when the share price of the investment goes
ex-dividend.
(iv)
Interest income is accrued on a time-apportioned basis by reference to the principal outstanding
and at the rate applicable.
(v)
Income from management services is recognised upon provision of services.
l)
Income taxes
(i)
Income tax for the year comprises current tax and deferred tax. Income tax is recognised in the
profit and loss account except to the extent that it relates to items recognised directly in equity, in
which case it is recognised in equity.
(ii)
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted
or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of
previous years.
(iii)
Deferred tax assets and liabilities arise from deductible and taxable temporary differences
respectively, being the differences between the carrying amounts of assets and liabilities for
financial reporting purposes and their tax bases. Deferred tax assets also arise from unused tax
losses and unused tax credits.
Deferred tax is provided, using the balance sheet liability method, in respect of all temporary
differences arising between the carrying amounts of assets and liabilities in the accounts and the
corresponding tax bases used in the computation of taxable profits, with limited exceptions.
Deferred tax liabilities are provided in full on all temporary differences while deferred tax assets
relating to carry forward of unused tax losses are recognised to the extent that it is probable that
future taxable profits will be available against which the unused tax losses can be utilised.
The amount of deferred tax recognised is measured based on the expected manner of realisation or
settlement of the carrying amount of the assets and liabilities, using tax rates enacted or
substantively enacted at the balance sheet date.
The carrying amount of a deferred tax asset is reviewed at each balance sheet date and is reduced
to the extent that it is no longer probable that sufficient taxable profits will be available to allow the
related tax benefit to be utilised. Any such reduction is reversed to the extent that it becomes
probable that sufficient taxable profits will be available.
45
Wheelock and Company Limited Annual Report 2004/05
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