23. Deferred Income Tax liabilities
Deferred income tax liabilities are calculated on all temporary and deductible temporary differences arising from differences between accounting base and tax base. Deferred income tax is provided under the liability method using a principal tax rate of 35% which will be effective from year of assessment 2008/09
(year of assessment 2007/08 - 33 1/3%).
The movement in the deferred income tax account is as follows:
|
Group |
Company |
|
2008 |
2007 |
2008 |
2007 |
| At the beginning of the year |
2,777 |
4,513 |
2,777 |
4,513 |
| Income statement release (Note 12) |
(1,680) |
(1,736) |
(1,680) |
(1,736) |
| At the end of the year |
1,097 |
2,777 |
1,097 |
2,777 |
|
|
|
|
|
The temporary and deductible temporary differences mainly arise from property, plant & equipment, deferred income, provision for defined benefit obligations and other provisions.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. The offset amounts are as follows:
|
|
|
|
2008 |
2007 |
| Deferred income tax assets: |
|
|
| - Deferred tax asset to be recovered after
more than 12 months |
4,600 |
4,679 |
| - Deferred tax asset to be recovered
within 12 months |
311 |
238 |
|
4,911 |
4,917 |
|
|
|
| Deferred income tax liabilities: |
|
|
| - Deferred tax liability to be recovered after more
than 12 months |
4,608 |
6,305 |
| - Deferred tax liability to be recovered within
12 months |
1,400 |
1,389 |
|
6,008 |
7,694 |
| Deferred tax liabilities (net) |
1,097 |
2,777 |
|
|
|
|
|
|
The movement in deferred income tax assets and liabilities during the year, without taking into consideration the off-setting of balances within the same tax jurisdiction, is as follows:
| |
Group/Company
Accelerated
tax depreciation |
| Deferred income tax liabilities |
|
| At 1 January 2007 |
9,004 |
| Credited to the income statement |
(1,310) |
| At 31 December 2007 |
7,694 |
| Credited to the income statement |
(1,686) |
| At 31 December 2008 |
6,008 |
|
|
|
Group/Company |
|
Defined benefit
obligations |
Provisions |
Deferred
income |
Total |
| Deferred income tax assets |
|
|
|
|
| At 1 January 2007 |
(311) |
(1,810) |
(2,370) |
(4,491) |
| (Credited)/charged to the income statement |
(134) |
(412) |
120 |
(426) |
| At 31 December 2007 |
(445) |
(2,222) |
(2,250) |
(4,917) |
| Charged/(credited) to the income statement |
45 |
(251) |
212 |
6 |
| At 31 December 2008 |
(400) |
(2,473) |
(2,038) |
(4,911) |
| |
|
|
|
|
Deferred income tax assets are recognised for tax losses carry-forwards to the extent that the realisation of the related tax benefit through future taxable profits is probable. The Group did not recognise deferred income tax assets of Rs. 34 million (2007 - Rs. 12 million) in respect of tax losses of subsidiaries amounting to Rs. 97 million (2007 - Rs. 35 million) that can be carried forward against future taxable income.
24. Deferred Income
Deferred income of the Company represents the connection charges relating to PSTN network, net of amounts amortised to the income statement. The connection charges are amortised over a period of
15 years as stated in Accounting Policy 2.21(iv). Deferred income of the Group represents the connection charges relating to PSTN network, net of amounts amortised to the income statement and deferred prepaid-card
revenue of Mobitel (Pvt) Limited.
The movement in the deferred income account is as follows:
|
Group |
Company |
|
2008 |
2007 |
2008 |
2007 |
| At the beginning of the year |
6,664 |
7,110 |
6,429 |
7,110 |
| Connection fees for the year |
724 |
481 |
314 |
246 |
| Amount credited to income statement
during the year (Note 5) |
(921) |
(927) |
(921) |
(927) |
| At the end of the year |
6,467 |
6,664 |
5,822 |
6,429 |
| |
|
|
|
|
Representing deferred income:
|
Group |
Company |
|
2008 |
2007 |
2008 |
2007 |
| - Current |
1,535 |
1,135 |
890 |
900 |
| - Non-current |
4,932 |
5,529 |
4,932 |
5,529 |
|
6,467 |
6,664 |
5,822 |
6,429 |
|
|
|
|
|
|
