2012 TPSEA Annual Report - Serena Hotels

Notes to the Financial Statements (continued)
8 Finance income and costs
Group
2011 2010
Shs’000
Shs’000
Interest income:
- fixed and call deposits 52,414 37,119
- staff loans 1,510 2,200
- related party loans - 12,908
Net foreign currency exchange gain on borrowings 5,833 -
Finance income 59,757 52,227
Interest expense:
- bank borrowings (163,847) (188,493)
Net foreign currency exchange loss on borrowings - (22,290)
Finance costs (163,847) (210,783)
Net finance costs (104,090) (158,556)
9 Income tax expense
Group
2011 2010
Shs’000
Shs’000
Current income tax 130,837 108,366
Deferred income tax (Note 15) 106,405 68,183
Income tax expense 237,242 176,549
The tax on the Group’s profit before income tax differs from the theoretical amount that would arise using the
statutory income tax rate as follows:
Group
2011 2010
Shs’000
Shs’000
Profit before income tax 853,133 692,933
Tax calculated at domestic rates applicable to profits
in the respective countries - 30% (2010-30%) 255,940 207,880
Tax effect of:
Income not subject to tax (1,388) (71,090
Expenses not deductible for tax purposes 21,647 23,064
Over provision of deferred income tax in prior year 10,681 16,695
Deductible investment allowances (49,638) -
Income tax expense 237,242 176,549
TPS EASTERN AFRICA LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS 2011 63