Annual Report 2010 - Leeden Limited

A Stronger Leeden in Asia.Notes to the Financial Statementsfor the Financial Year ended 31 December 20108. Taxation (cont’d)Relationship between tax expense and accounting profitThe reconciliation between the tax expense and the product of accounting profit multiplied by the applicable corporate taxrate for years ended 31 December 2010 and 2009 are as follows:Group2010 2009$’000 $’000Profit before taxation 15,083 17,228Tax at domestic rates applicable to profits in the countries where the Group operates 3,736 5,130Adjustments:Non-deductible expenses 294 1,451Income not subject to taxation (265) (2,440)Utilisation of tax losses and capital allowances previously not recognised (85) (269)Effect of partial tax exemption and relief (432) (164)Deferred tax asset not recognised 124 15Effects of reduction in tax rate – (194)Over provision in respect of previous year (424) (167)Others 296 (28)Income tax expense recognised in the income statement 3,244 3,334At 31 December 2010, the Group has unutilised tax losses and unabsorbed capital allowances of approximately$6,923,000 and $371,000 (2009: $5,632,000 and $320,000) respectively, which are available for set off against futuretaxable income subject to the respective local tax provisions and regulations. No deferred tax asset is recognised in thefinancial statements for these unutilised tax losses due to uncertainty of its recoverability.The above reconciliation is prepared by aggregating separate reconciliations for each national jurisdiction.68