FGV Annual Report 2018

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2018 208 FGV HOLDINGS BERHAD EXAMINED OUR NUMBERS 15 TAXATION (CONTINUED) A reconciliation of income tax expense applicable to (loss)/profit before taxation after zakat at the Malaysian statutory income tax rate to income tax expense at the effective income tax rate of the Group and of the Company is as follows: Group Company 2018 RM’000 2017 RM’000 2018 RM’000 2017 RM’000 (Loss)/profit before taxation after zakat (1,041,554) 397,470 116,113 125,451 Malaysian corporate tax rateof 24% (2017: 24%) (249,973) 95,393 27,867 30,108 Tax effect of: - different tax rates in other countries (2,575) 13,648 - - - expenses not deductible for tax purposes 222,222 87,031 30,325 35,379 - income not subject to tax (16,257) (38,755) (56,713) (86,023) - under/(over) provision of income tax in prior financial year (1,957) 1,843 (172) 4,553 - temporary differences not recognised as deferred tax 168,317 40,485 - 20,665 - tax incentive - (7,962) - - - temporary differences previously not recognised as deferred tax (29,058) (3,160) (29,058) - - impact of transfer pricing adjustments - 10,826 - - - others 9,850 779 - - Tax expense 100,569 200,128 (27,841) 4,682 In the previous financial year, additional tax liabilities of RM10,826,000 had been recognised by the Group, which arose from transfer pricing adjustments in respect of certain intercompany transactions in 2017 and 2016 respectively.