Annual Report 2016
147
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED MARCH 31, 2016
26. DEFERRED TAX
– continued
As the Group does not expect to distribute dividends out of the earnings from its Taiwan
subsidiaries in the next twelve months from the end of the reporting period, it has accrued 10%
surtax as at March 31, 2016 accordingly.
Deferred taxation has not been provided for in the consolidated financial statements in respect
of temporary differences attributable to accumulated profits of the PRC and Taiwan subsidiaries
amounting to approximately HK$18,952,000 (2015: HK$30,667,000) as the Group is able to
control the timing of the reversal of the temporary differences and it is probable that the temporary
differences will not reverse in the foreseeable future.
For the purposes of statement of financial position presentation, certain deferred tax assets and
liabilities have been offset. The following is the analysis of the deferred tax balances for statement
of financial position purposes:
THE GROUP
2016
2015
HK$’000
HK$’000
Deferred tax assets
385
413
Deferred tax liabilities
(24,952)
(25,774)
(24,567)
(25,361)
Subject to the agreement by the tax authorities, at March 31, 2016, the Group has unutilised tax
losses of HK$55,061,000 (2015: HK$42,395,000) available for offset against future profits. No
deferred tax asset has been recognised due to the unpredictability of future profit streams. Tax
losses may be carried forward indefinitely subject to the conditions imposed by law including the
retention of majority shareholders as defined.
At March 31, 2016, the Group has other deductible temporary difference of approximately
HK$14,314,000 (2015: HK$14,786,000). No deferred tax asset has been recognised in relation
to such deductible temporary difference as it is not probable that the deductible temporary
differences can be utilised.
