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Annual Report 2014 | S P SETIA BERHAD GROUP | 133


For the year ended 31 October 2014



(y) Taxation

The income tax expense in profit or loss represents the aggregate amount of current tax and deferred tax. Current tax is the

expected income tax payable or receivable on the taxable income or loss for the year, estimated using the tax rates enacted or

substantially enacted by the end of the reporting period.

On the statement of financial position, a deferred tax liability is recognised for taxable temporary differences while a deferred tax

asset is recognised for deductible temporary differences and unutilised tax losses only to the extent that it is probable that taxable

profit will be available in future against which the deductible temporary differences and tax losses can be utilised.

No deferred tax is recognised for temporary differences arising from the initial recognition of:

(i) goodwill, or

(ii) an asset or liability which is not a business combination and at the time of the transaction, affects neither accounting profit nor

taxable profit.

Deferred tax assets and liabilities are measured based on tax consequences that would follow from the manner in which the asset

or liability is expected to be recovered or settled, and based on tax rates enacted or substantively enacted by the reporting date that

are expected to apply to the period when the asset is realised or when the liability is settled.

Current tax and deferred tax are charged or credited directly to other comprehensive income if the tax relates to items that are

credited or charged, whether in the same or a different period, directly to other comprehensive income.

(z) Cash and cash equivalents

Cash and cash equivalents consist of cash and bank balances, deposits with licensed banks, fixed income trust funds and other

licensed financial institutions, which are short term, highly liquid investments that are readily convertible to known amounts of cash

and which are subject to insignificant risk of changes in value.

For the purposes of the statements of cash flows, cash and cash equivalents are presented net of bank overdrafts and exclude fixed

deposits, sinking fund, debt service reserve, escrow and revenue accounts pledged to secure banking facilities.

(aa) Operating segments

Segment reporting in the financial statements is presented on the same basis as it is used by management internally for evaluating

operating segment performance and in deciding how to allocate resources to each operating segment. Operating segments are

distinguishable components of the Group that engage in business activities from which they may earn revenues and incur expenses,

including revenues and expenses that relate to transactions with any of the Group’s other components. An operating segment’s

results are reviewed regularly by the chief operating decision maker to decide how to allocate resources to the segment and assess

its performance, and for which discrete financial information is available.

Segment revenues, expenses, assets and liabilities are those amounts resulting from operating activities of a segment that are

directly attributable to the segment and a relevant portion that can be allocated on a reasonable basis to the segment.

Segment revenues, expenses, assets and liabilities are determined before intra-group balances and intra-group transactions are

eliminated as part of the consolidation process, except to the extent that such intra-group balances and transactions are between

group entities within a single segment.