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Notes to the Financial Statements (cont’d)
For the financial year ended 31 December 2011
12. Income tax expense (cont’d)
Reconciliation between tax expense and accounting profit
The reconciliation between tax expense and the product of accounting profit multiplied by the applicable corporate tax rate
for the years ended 31 December 2011 and 2010 are as follows:
Group Company
2011 2010 2011 2010
RM’000 RM’000 RM’000 RM’000
Profit/(Loss) before tax 91,132 (78,463) 62,837 (96,022)
Taxation at Malaysian statutory tax rate of
25% (2010: 25%) 22,783 (19,616) 15,709 (24,006)
Different tax rates in other countries (868) 435 – –
Income not subject to tax (1,349) (5,828) (1,349) (5,096)
Expenses not deductible for tax purpose 9,368 43,936 11,040 44,515
Benefits from previously unrecognised tax losses – (4) – –
Deferred tax assets not recognised 901 1,605 – –
(Over)/Under provision of deferred tax in prior years (1,098) (106) (27) 38
Under/(Over) provision of tax expense in prior years 4,034 (96) (1,843) (155)
Foreign withholding tax 705 1,442 705 1,442
Income tax expense recognized in profit or loss 34,476 21,768 24,235 16,738
During the financial year, a subsidiary in Indonesia received various assessments for taxes and penalties for fiscal year 2008
from the tax office indicating an underpayment of corporate income tax (“CIT”) of USD1,499,709 (instead of an overpayment
of USD3,235,579 as reported in its 2008 annual income tax return) and an underpayment of withholding taxes and value
added tax of USD1,625,983.
The subsidiary filed an objection to the tax office on 2 February 2012 and recognized an amount of USD1,052,632 as an
additional tax expense (offset against the CIT overpayment of USD3,235,579 recorded in its 2008 annual income tax return)
during the financial year.
13. Basic and diluted earnings/(loss) per share
Basic and diluted earnings/(loss) per share are calculated by dividing profit/(loss) for the year attributable to owners of the
Company by the weighted average number of ordinary shares in issue during the financial year.
Group
2011 2010
Profit/(Loss) attributable to owners of the Company (RM’000) 60,523 (80,249)
Weighted average number of ordinary shares for basic earnings/(loss) per share
computation* (‘000) 98,288 75,000
Basic and diluted earnings/(loss) per share (sen) 61.6 (107.0)
* The weighted average number of shares takes into account the weighted average effect of new issuance of ordinary
shares during the year.
MALAYSIA SMELTING CORPORATION (43072-A) • ANNUAL REPORT 2011 111