Volvo 2004 Annual Report Download - page 99
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97
Claims as a consequence of tax audit carried out previously for which
provisions are not deemed necessary amount to 135 (–; –). The
amount is included in contingent liabilities.
Deferred taxes relate to estimated tax on the change in tax-loss
carryforwards and temporary differences. Deferred tax assets are
reported to the extent that it is probable that the amount can be uti-
lized against future taxable income.
Deferred taxes related to change in tax-loss carryforwards amount
to –1,427 (148; 1,111) and to changes in other temporary differences
to 15 (10; 10). No income taxes have been debited or credited directly
to equity.
The table below shows the principal reasons for the difference
between the corporate income tax (28%) and the tax for the period.
Note 8Income taxes
2002 2003 2004
Current taxes (51) — 92
Deferred taxes 1,121 158 (1,412)
Total income taxes 1,070 158 (1,320)
Current taxes were distributed as follows:
Current taxes 2002 2003 2004
Current taxes for the period – — –
Adjustment of current taxes for prior periods (51) — 92
Total income taxes (51) — 92
2002 2003 2004
Income before taxes (3,555) (2,347) 6,418
Income tax according to applicable tax rate (28%) 995 657 (1,797)
Capital gains 187184
Non-taxable dividends 350 1,362 46
Recognition of deferred tax assets (70) – –
Non-taxable revaluations of shareholdings (150) (1,831) (153)
Other non-deductible expenses (11) (120) 26
Other non-taxable income 6 3 282
Adjustment of current taxes for prior periods (51) – 92
Total income taxes 1,070 158 (1,320)
Specification of deferred tax assets 2002 2003 2004
Tax-loss carryforwards 2,221 2,369 942
Valuation allowance for doubtful receivables 1 2 1
Provision for post-employment benefits 125 137 154
Other deductible temporary differences 4 1 0
Deferred tax assets 2,351 2,509 1,097
Note 7Allocations
2002 2003 2004
Allocation to additional depreciation 0 0 (1)
Utilization of tax allocation reserves – – 1,525
Total 001,524
Note 6Other financial income and expenses
Other financial income and expenses include exchange rate differ-
ences on loans, guarantee commissions from subsidiaries, costs for
confirmed credit facilities as well as costs of having Volvo shares
registered on various stock exchanges. In 2004 expenses for distri-
bution of the shares in Ainax AB to Volvo's shareholders and repay-
ment of interest and residual taxes regarding a judgement in the
Administrative court of appeal are included. Previous years unreal-
ized gains (losses) pertaining to a hedge for a program of employee
stock options also are included.