Porsche 2012 Annual Report Download - page 182

Financials
Notes to the consolidated fi nancial statements
Cash, cash equivalents and time deposits
The cash, cash equivalents and time deposits include checks, cash on hand and at banks. This
item may also include cash and cash equivalents that are not freely available for use by the
Porsche SE group.
Deferred taxes
Deferred tax assets are generally recognized for deductible temporary differences between the
tax base and carrying amounts in the consolidated balance sheet (taking into account temporary
differences arising from consolidation) as well as on unused tax losses and tax credits if it is
probable that they will be used. Deferred tax liabilities have to be recorded for all temporary
differences between the carrying amounts in the tax accounts and the consolidated balance
sheet (temporary concept). Deferred tax liabilities for taxable temporary differences associated
with investments in subsidiaries, associates and interests in joint ventures are not recognized if
the timing of the reversal of the temporary differences can be controlled and it is probable that
the temporary differences will not reverse in the foreseeable future.
Valuation allowances are recorded on deferred tax assets whose realization in the foresee-
able future is not likely. A previously unrecognized deferred tax asset is reassessed and recog-
nized to the extent that it has become probable that future taxable profit will allow it to be
recovered.
Deferred taxes are measured on the basis of the tax rates that apply or that are expected to
apply based on the current legislation in the individual countries at the time of realization. Deferred
taxes are not discounted.
Deferred taxes referring to items recognized directly in equity are presented in equity. De-
ferred tax assets and deferred tax liabilities are offset if the group entities have a legally enforce-
able right to set off current tax assets against current tax liabilities and the deferred taxes relate
to the same taxable entity and the same taxation authority.
Current taxes
Current income tax assets and liabilities for the current and prior periods are measured at the
amount expected to be refunded by or paid to the taxation authorities. The tax rates and tax
laws applied for measurement are those that are enacted or substantively enacted by the report-
ing date. Adequate provisions were recognized for future probable tax liabilities, considering a
large number of factors such as interpretations, commentaries and jurisdiction on the pertinent
tax legislation as well as past experience.
Current tax relating to items recognized directly in equity is also recognized directly in equity.
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