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4 Termination benefits
Termination benefits are expensed at the earlier of when the Group can no longer withdraw the offer of those benefits and
when the Group recognises costs for a restructuring. If benefits are not expected to be settled wholly within 12 months of the
reporting date, then they are discounted - before tax – to ref lect the time value of money.
F Finance income and finance costs
The Group’s finance income and finance costs include:
• interest income.
• interest expense.
• Foreign currency gains or loss on financial assets and financial liabilities.
Interest income or expense is recognised using the effective interest method.
G Income Tax
The recognition of the current tax and deferred tax as income or expense in the profit or loss for the period, except in cases in
which the tax comes fromprocess or event recognized - at the same time or in a different period - outside profit or loss, whether
in other comprehensive income or in equity directly or business combination.
1 Current income tax
The recognition of the current tax for the current period and prior periods and that have not been paid as a liability, but if
the taxes have already been paid in the current period and prior periods in excess of the value payable for these periods, this
increase is recognized as an asset. The taxable current liabilities (assets) for the current period and prior periods measured at
expected value paid to (recovered from) the tax authority, using the current tax rates (and tax laws) or in the process to issue
in the end of the financial period. Dividends are subject to tax as part of the current tax. But do not be offset for tax assets and
liabilities only when certain conditions aremet.
2 Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for:
• Taxable temporary differences arising on the initial recognition of goodwill.,
• Temporary differences on the initial recognition of assets or liabilities in a transaction that is not:
1. A business combination.
2. And not affects neither accounting nor taxable profit or loss.
Temporary differences related to investments in subsidiaries, associates and joint arrangements to the extent that the Group
is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the
foreseeable future.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to the
extent that it is probable that future taxable profits will be available against which they can be used. Future taxable profits
are determined based on business plans for individual subsidiaries in the Group. deferred tax assets are reassessed at each
reporting date, and recognised to the extent that it has become probable that future taxable profits will be available against
which they can be used.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences.
The measurement of deferred tax ref lects the tax consequences that would follow from the manner in which the Group ex-
pects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset only if certain criteria aremet.
2016 ANNUAL REPORT
99
GB Auto (S.A.E.)
Notes to the consolidated financial statements for the financial year ended December 31, 2016
(In thenotes all amounts are shown inThousandEgyptianPounds unless otherwise stated)