Carphone Warehouse 2006 Annual Report Download - page 54

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Notes to the Financial Statements continued
8 Taxation continued
Tax on items charged to equity is as follows:
2006 2005
£’000 £’000
Current tax credit on share-based payments 3,703 –
Deferred tax credit on share-based payments 15,820 1,996
Deferred tax credit on other items 74 –
19,597 1,996
The following are the major deferred tax assets and liabilities recognised by the Group and movements thereon during the period:
Timing
differences on
Acquisition Share-based capitalised Other timing
intangibles payments costs Tax losses differences Total
£’000 £’000 £’000 £’000 £’000 £’000
At 2 April 2005 (1,662) 7,876 (13,481) 5,865 1,872 470
Adoption of IAS39 and IAS32 (see note 30) ––––(218) (218)
Charge to income 3,867 3,483 558 567 3,140 11,615
Charge to equity – 15,820 – – 74 15,894
Acquisition of subsidiaries (8,056) – 10,760 – 4,473 7,177
At 1 April 2006 (5,851) 27,179 (2,163) 6,432 9,341 34,938
Certain deferred tax assets and liabilities have been offset. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
2006 2005
£’000 £’000
Deferred tax assets 34,938 4,570
Deferred tax liabilities –(4,100)
34,938 470
At 1 April 2006 the Group has unused tax losses of £166.4m (2005 – £146.6m) available for offset against future taxable profits. A deferred tax asset of £6.4m
(2005 – £5.9m) has been recognised in respect of £20.3m (2005 – £15.7m) of such losses, based on expectations of recovery in the foreseeable future.
No deferred tax asset has been recognised in respect of the remaining £146.1m (2005 – £130.9m) as there is insufficient evidence that there will be suitable
taxable profits against which these losses can be recovered. Included within unrecognised tax losses are amounts of £16.7m (2005 – £18.4m) that will expire
between 2014 and 2018 and £9.3m (2005 – £12.8m) that will expire between 2008 and 2013. Other losses may be carried forward indefinitely.
At 1 April 2006, the aggregate amount of temporary differences associated with the undistributed earnings of subsidiaries for which deferred tax liabilities have not
been recognised was £25.9m (2005 – £17.8m). No liability has been recognised in respect of these differences because the Group is in a position to control the
timing of their reversal and it is probable that they will not reverse in the foreseeable future.
9 Equity dividends
2006 2005
£’000 £’000
Final dividend for the period ended 27 March 2004 of 0.90p per ordinary share –7,869
Interim dividend for the period ended 2 April 2005 of 0.55p per ordinary share –4,814
Final dividend for the period ended 2 April 2005 of 1.25p per ordinary share 11,005 –
Interim dividend for the period ended 1 April 2006 of 0.75p per ordinary share 6,438 –
17,443 12,683
Proposed final dividend for the period ended 1 April 2006 of 1.75p per ordinary share 15,283
The proposed final dividend for the period ended 1 April 2006 is subject to shareholders’ approval at the Annual General Meeting and has not been included as a
liability in these financial statements.
The expected cost of the proposed final dividend for the period ended 1 April 2006 reflects the fact that the Group’s Employee Share Ownership Trust has agreed
to waive its rights to receive dividends (see note 23).
The Carphone Warehouse Group PLC Annual Report 2006
50