FGV Annual Report 2018

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2018 316 FGV HOLDINGS BERHAD EXAMINED OUR NUMBERS 51 DEFERRED TAXATION (CONTINUED) Group Company 31.12.2018 RM’000 31.12.2017 RM’000 1.1.2017 RM’000 31.12.2018 RM’000 31.12.2017 RM’000 1.1.2017 RM’000 Deferred tax liabilities - intangible assets (15,869) (16,531) (28,968) - - - - property, plant and equipment (1,366,942) (1,432,376) (1,457,116) 6,719 - - - prepaid lease payments (2,306) (2,306) (2,306) - - - - biological assets (10,187) (13,041) (16,519) - - - - receivables (873) (190) (5,028) - - - - inventories (3,666) (3,666) (3,666) - - - - others (8,602) 304 (229) - - - Amount before offsetting (1,408,445) (1,467,806) (1,513,832) 6,719 - - Offsetting 673,075 655,443 664,505 (6,719) - - (735,370) (812,363) (849,327) - - - Under the Malaysia Finance Act 2018 which was gazetted on 27 December 2018, the Group’s and Company’s unused tax losses with no expiry period as at 31 December 2018 for which no deferred tax assets were recognised amounted to RM979,085,000 and RM148,282,000 respectively will be imposed with a time limit of utilisation . Any accumulated unused tax losses brought forward from year of assessment 2018 can be carried forward for another 7 consecutive years of assessment (i.e. from year of assessments 2019 to 2025). The significant reduction as a result of time limit imposed above to the Group during the financial year relates to the deferred tax assets reversal of a refinery business of RM21,292,000 as the tax benefits are not expected to be utilised by 2025. In addition, a reversal of RM53,290,000 relating to APL’s deferred tax assets was recognised as the amount relating to unabsorbed tax losses is not expected to be utilised subsequent to the impairment assessment done on APL (Note 19). The amount of unused tax losses for which no deferred tax assets are recognised in the statement of financial position by certain subsidiaries of the Group and by Company as the Directors are of the view it is not probable that sufficient taxable profits will be available to allow the deferred tax assets to be utilised by year of assessment 2025 is as follows: Group Company 31.12.2018 RM’000 31.12.2017 RM’000 1.1.2017 RM’000 31.12.2018 RM’000 31.12.2017 RM’000 1.1.2017 RM’000 Unused tax losses 979,085 398,843 230,155 148,282 228,703 156,885 Deductible temporary differences - - - - 40,656 41,609 979,085 398,843 230,155 148,282 269,359 198,494