Singapore Airlines 2015 Annual Report Download - page 120

Notes to the Financial Statements
31 March 2015
2 Summary of Significant Accounting Policies (continued)
(aa) Taxation
(i) Current income tax
Tax recoverable and tax liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the tax authorities. The tax rates and tax laws used to compute the amount are those
that are enacted or substantively enacted by the end of the reporting period, in the countries where the Group
operates and generates taxable income. Management periodically evaluates positions taken in the tax returns with
respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions
where appropriate.
Current income taxes are recognised in the profit and loss account except to the extent that the tax relates to items
recognised outside profit or loss, either in other comprehensive income or directly in equity.
(ii) Deferred tax
Deferred tax is provided, using the liability method, on all temporary dierences at the end of the reporting period
between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all temporary dierences, except:
• Wherethedeferredtaxliabilityarisesfromtheinitialrecognitionofgoodwillorofanassetorliabilityina
transaction that is not a business combination and, at the time of the transaction, aects neither the accounting
profit nor taxable profit or loss; and
• Inrespectoftaxabletemporarydierencesassociatedwithinvestmentsinsubsidiary,associatedandjoint
venture companies, where the timing of the reversal of the temporary dierences can be controlled and it is
probable that the temporary dierences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary dierences, carry forward of unused tax credits and
unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary dierences, and the carry forward of unused tax credits and unused tax losses can be utilised except:
• Wherethedeferredtaxassetrelatingtothedeductibletemporarydierencearisesfromtheinitialrecognition
of an asset or liability in a transaction that is not a business combination and, at the time of the transaction,
aects neither the accounting profit nor taxable profit or loss; and
• Inrespectofdeductibletemporarydierencesassociatedwithinvestmentsinsubsidiary,associatedand
joint venture companies, deferred tax assets are recognised only to the extent that it is probable that the
temporary dierences will reverse in the foreseeable future and taxable profit will be available against which
the temporary dierences can be utilised.
The carrying amount of deferred tax asset is reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that suicient taxable profit will be available to allow all or part of the deferred tax asset
to be utilised. Unrecognised deferred tax assets are reassessed at the end of each reporting period and are recognised
to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the
asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively
enacted at the end of each reporting period.
118 FINANCIAL