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Notes to the Financial Statements
145
24. OTHER OPERATING INCOME 2008 2007
Note (Rupees in ‘000)
Exchange gain 107,506 67,360
Profit on sale of property, plant and equipment 15,606 15,796
Sales tax refund - . 2,022
Balances no longer payable written back 39,006 4,557
Gain on sale of marketable securities 22,084 - .
Rental income - . 9,010
Others - . 14,631
184,202 113,376
25. FINANCIAL INCOME AND EXPENSES
Mark-up from trade and other receivables 7,832 3,685
Income on amounts placed with banks
under deposit accounts 118,990 255,193
Financial income 126,822 258,878
Interest on workers' profits participation fund 6,836 1,215
Mark-up on short-term finances 91,551 147,002
Mark-up on trade and other payables 13,401 21,947
Commission on guarantees 81,095 16,489
Bank charges for services 62,383 106,681
(Reversal of provision) / provision for discounting
on long-term receivables (1,474) 23,605
Financial expenses 253,792 316,939
Net finance costs 126,970 58,061
26. INCOME TAX EXPENSE
Current
- For the year 1,257,271 913,864
- For prior years 76,571 102,585
1,333,842 1,016,449
Deferred (448,707) (35,569)
26.1 885,135 980,880
26.1 Reconciliation of income tax expense for the year
Accounting profit 2,564,203 1,964,574
Enacted tax rate 35% 35%
Tax on accounting profit at enacted rate 897,471 687,601
Tax effect of income assessed under
Presumptive Tax Regime (90,489) 190,086
Tax effect of expenses that are not allowable
in determining taxable income 1,582 608
Prior years' tax expense 76,571 102,585
885,135 980,880
26.2 The Company makes provision for taxation based on its understanding of the tax laws and regulations and on the basis of advices from its tax
consultants. These provisions may require change in case these laws and regulations are interpreted differently by tax authorities and Company’s
appeals are not accepted at various forums.