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VTech Holdings Ltd Annual Report 2006 45
10 Deferred Tax
The deferred tax assets and liabilities and the deferred tax account movements for the years ended 31st March 2005 and 31st
March 2006 are attributable to the following items:
31st March
Credited/ 2005
(charged) and Credited
1st April to income 1st April to income Charged to 31st March
2004 statement 2005 statement reserve 2006
US$ million US$ million US$ million US$ million US$ million US$ million
Deferred tax assets
Provisions – 0.4 0.4 – – 0.4
Tax losses carried forward 2.3 (0.2) 2.1 0.5 – 2.6
Other deductible temporary differences 1.4 0.3 1.7 0.5 – 2.2
3.7 0.5 4.2 1.0 – 5.2
Deferred tax liabilities
Accelerated tax depreciation (1.6) (0.7) (2.3) 0.1 – (2.2)
Revaluation of properties ––––(2.0) (2.0)
(1.6) (0.7) (2.3) 0.1 (2.0) (4.2)
Net deferred tax assets 2.1 (0.2) 1.9 1.1 (2.0) 1.0
12 Stocks
2006 2005
US$ million US$ million
Telecommunication and
electronic products
Raw materials 35.7 33.2
Work in progress 13.7 11.4
Finished goods 84.4 79.6
133.8 124.2
Stocks carried at net realisable value at 31st March 2006
amounted to US$35.0 million (2005: US$33.9 million).
13 Debtors and Prepayments
2006 2005
Note US$ million US$ million
Trade debtors
(Net of provision for
doubtful debts of
US$5.4 million
(2005: US$3.7 million)) 162.9 162.3
Other debtors and
prepayments 18.9 11.7
Pension assets 16 1.8 1.7
183.6 175.7
An ageing analysis of net trade debtors by transaction date is
as follows:
2006 2005
US$ million US$ million
0-30 days 90.7 73.2
31-60 days 41.4 53.9
61-90 days 17.0 21.3
>90 days 13.8 13.9
Total 162.9 162.3
The majority of the Group’s sales are on letter of credit
and on open credit with varying terms of 30 to 90 days.
Certain open credit sales are covered by credit insurance or
bank guarantees.
Deferred tax assets and liabilities are offset when they relate
to income taxes levied by the same taxation authority on the
same taxable entity. The following amounts are shown in the
consolidated balance sheet:
2006 2005
US$ million US$ million
Deferred tax assets 5.1 2.6
Deferred tax liabilities (4.1) (0.7)
1.0 1.9
Deferred tax assets are recognised for tax losses carried
forward to the extent that realisation of the related tax
benefit through future taxable profits is probable. Deferred
tax assets of US$42.9 million (2005: US$57.9 million) arising
from unused tax losses of US$131.2 million (2005: US$173.4
million) have not been recognised at the end of the year.
11 Investments
2006 2005
US$ million US$ million
i) Associates
Share of net tangible assets 0.1 0.1
ii) Other investments
Unlisted investments, at cost 0.1 0.1
0.2 0.2