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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
22 Deferred tax assets
Deferred taxation is calculated in full on temporary differences under the liability method using the rates applicable in the
respective jurisdictions.
The movements in deferred tax assets/(liabilities) are as follows:
Group
2008 2007
US$’000 US$’000
At the beginning of the year 101,551 62,345
Exchange and reclassification adjustments 8,309 (91)
Credited to consolidated income statement 51,482 39,297
Disposal of discontinued operations (Note 13(a)) (4,902) –
At the end of the year 156,440 101,551
Closing net book amount analyzed into:
Group
2008 2007
US$’000 US$’000
Current 92,171 30,029
Non-current 64,269 71,522
156,440 101,551
Deferred tax assets are recognized for deductible temporary differences and tax losses carried forward to the extent that
realization of the related tax benefit through the future taxable profits is probable. At March 31, 2008, the Group has unrecognized
ta x losses of approximately US$62,529,000 (2007: US$28,054,000) that can be carried forward against future taxable income.
Unrecognized tax losses of US$38.7 million (2007: US$1.0 million) can be carried forward indefinitely. The remaining balances
of US$7.4 million (2007: US$7.4 million), US$19.7 million (2007: US$19.7 million) and US$11.6 million (2007: Nil) expire in 2014,
2015 and 2016 respectively.
The movements in deferred tax assets and liabilities, analyzed by major component, during the year are as follows:
Provisions Tax losses
Tax
depreciation
allowances
Deferred
revenue Others Total
US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
Year ended March 31, 2007
At the beginning of the year 53,759 2,829 5,757 – – 62,345
Exchange and
reclassification
adjustments (9,373) (2,787) 57 8,10 0 3,912 (91)
Credited to consolidated
income statement 15,693 7, 8 6 2 4,038 5,457 6,247 39,297
At the end of the year 60,079 7,9 0 4 9,852 13,557 10,159 101,551
Year ended March 31, 2008
At the beginning of the year 60,079 7,904 9,852 13,557 10,159 101,551
Exchange and
reclassification
adjustments 6,586 2,922 241 1,609 (3,049) 8,309
Credited/(debited) to
consolidated
income statement 37,559 (3,168) (4,118) 14,468 6,741 51,482
Disposal of discontinued
operations (4,902) – – – – (4,902)
At the end of the year 99,322 7,65 8 5,975 29,634 13,851 156,440
Lenovo Group Limited • Annual Report 2007/08
120