BAE-annual-report-2014

Financial statements
15. DEFERRED TAX
A deferred tax asset is recognised for unused tax losses, 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 utilised. Deferred tax assets are reviewed at each
reporting date and reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they
relate to income taxes levied by the same tax authority on the same taxable entity, or on different taxable entities, but they intend to
settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.
Deferred tax assets/(liabilities)
Deferred tax assets
Deferred tax liabilities
Net balance at
31 December
Property, plant and equipment 15 20 (93) (82) (78) (62)
Intangible assets 4 – (39) (45) (35) (45)
Provisions and accruals 287 308 – – 287 308
Goodwill – – (273) (221) (273) (221)
Pension/retirement schemes:
Deficits 1,154 692 – – 1,154 692
Additional contributions and other 1 121 124 – – 121 124
Share-based payments 21 19 – – 21 19
Financial instruments 26 7 (5) (6) 21 1
Other items 66 59 – – 66 59
Rolled over capital gains – – (13) (13) (13) (13)
Capital losses carried forward 13 13 – – 13 13
Trading losses carried forward 22 19 – – 22 19
Deferred tax assets/(liabilities) 1,729 1,261 (423) (367) 1,306 894
Set off of tax (402) (360) 402 360 – –
Net deferred tax assets/(liabilities) 1,327 901 (21) (7) 1,306 894
1. Includes deferred tax assets on US deferred compensation plans.
2014
£m
2013
£m
2014
£m
2013
£m
2014
£m
2013
£m
STRATEGIC REPORT GOVERNANCE
FINANCIAL STATEMENTS
BAE Systems
Annual Report 2014
129