58
TEHO INTERNATIONAL INC LTD.
Annual Report 2016
NOTES
TO THE FINANCIAL STATEMENTS
Year ended 30 June 2016
3 SIGNIFICANTACCOUNTING POLICIES (CONT’D)
3.17 Tax (cont’d)
•
taxable temporary differences arising on the initial recognition of goodwill.
The measurement of deferred taxes reflects the tax consequences that would follow
the manner in which the Group expects, at the reporting date, to recover or settle the
carrying amount of its assets and liabilities. Deferred tax is measured at the tax rates
that are expected to be applied to temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted by the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to
offset current tax liabilities and assets, and they relate to taxes levied by the same tax
authority on the same taxable entity, or on different tax entities, but they intend to
settle current tax liabilities and assets on a net basis or their tax assets and liabilities
will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible
temporary differences, to the extent that it is probable that future taxable profits will
be available against which they can be utilised. Deferred tax assets are reviewed at
each reporting date and are reduced to the extent that it is no longer probable that the
related tax benefit will be realised.
In determining the amount of current and deferred tax, the Group takes into account
the impact of uncertain tax positions and whether additional taxes and interest may be
due. The Group believes that its accruals for tax liabilities are adequate for all open tax
years based on its assessment of many factors, including interpretations of tax law and
prior experience. This assessment relies on estimates and assumptions and may involve
a series of judgements about future events. New information may become available
that causes the Group to change its judgement regarding the adequacy of existing tax
liabilities; such changes to tax liabilities will impact tax expense in the period that such
a determination is made.
3 SIGNIFICANTACCOUNTING POLICIES (CONT’D)
3.18 Earnings per share
The Group presents basic and diluted earnings per share data for its ordinary shares.
Basic earnings per share is calculated by dividing the profit or loss attributable to
ordinary shareholders of the Company by the weighted-average number of ordinary
shares outstanding during the year, adjusted for own shares held. Diluted earnings per
share is determined by adjusting the profit or loss attributable to ordinary shareholders
and the weighted-average number of ordinary shares outstanding, adjusted for own
shares held, for the effects of all dilutive potential ordinary shares.
3.19 Segment reporting
An operating segment is a component of the Group that engages in business activities
from which it may earn revenues and incur expenses, including revenues and expenses
that relate to transactions with any of the Group’s other components. All operating
segments’ operating results are reviewed regularly by the Group’s CEO (the chief
operating decision maker) to make decisions about resources to be allocated to the
segment and to assess its performance, and for which discrete financial information is
available.
Segment results that are reported to the Group’s CEO include items directly attributable
to a segment as well as those that can be allocated on a reasonable basis. Unallocated
items comprise mainly corporate assets (primarily the Company’s headquarters) and
head office expenses.
Segment capital expenditure is the total cost incurred during the year to acquire
property, plant and equipment, and intangible assets other than goodwill.
