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STAMFORD LAND CORPORATION LTD
NOTES TO THE FINANCIAL STATEMENTS
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)
Income Tax
Current and deferred income taxes are recognised as income or expense in profit or loss, except to the extent
that the tax arises from a business combination or a transaction which is recognised directly in equity or in
other comprehensive income.
Current income tax for current and prior periods is recognised at the amount expected to be paid to or
recovered from the tax authorities, using the tax rates and tax laws that have been enacted or substantively
enacted by the balance sheet date.
Deferred income tax is recognised for all temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements except when the deferred income tax arises
from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination
and affects neither accounting nor taxable profit or loss at the time of the transaction. Deferred tax arising
from a business combination is adjusted against goodwill on acquisition.
Deferred income tax is recognised on temporary differences arising on investments in subsidiaries,
associated companies and joint ventures, except where the Group is able to control the timing of the reversal
of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable
future. A deferred income tax asset is recognised to the extent that it is probable that future taxable profit will
be available against which the deductible temporary differences and tax losses can be utilised. Deferred tax
assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the
related tax benefit will be realised.
Deferred income tax is measured:
(i) at the tax rates that are expected to apply when the related deferred income tax asset is realised or
the deferred income tax liability is settled, based on tax rates and tax laws that have been enacted or
substantively enacted by the balance sheet date; and
(ii) based on the tax consequence that will follow from the manner in which the Group expects, at the
balance sheet date, to recover or settle the carrying amounts of its assets and liabilities except for
investment properties. Investment property measured at fair value is presumed to be recovered entirely
through sale.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities
and assets, and they relate to taxes levied by the same tax authority on the same taxable entity, or on different
tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and
liabilities will be realised simultaneously.
