2012 Annual Report - ZTE

ZTE CORPORATIONNotes to Financial Statements(Prepared under Hong Kong Financial Reporting Standards)31 December 201240. DEFERRED TAXThe movements in deferred tax assets and liabilities during the year are as follows:Deferred tax assets and liabilities:GroupCompany2012 2011 2012 2011RMB’000 RMB’000 RMB’000 RMB’000At beginning of year 1,128,836 566,078 622,619 381,368Deferred tax credited/(charged) to profitor loss during the year (note 10) 89,769 562,758 (41,112) 241,251Deferred tax credited to othercomprehensive income (139,900) — (138,400) —At end of year 1,078,705 1,128,836 443,107 622,619Deferred tax assets:GroupCompany2012 2011 2012 2011RMB’000 RMB’000 RMB’000 RMB’000Unrealised profits arising on consolidation 148,805 90,557 — —Provision against inventories 109,550 86,465 30,173 25,772Foreseeable contract losses 2,640 10,265 2,640 10,265Amortisation of intangible assets 60,990 36,913 16,694 11,335Provision for warranties 28,101 51,904 23,954 36,170Provision for retirement benefits 8,902 8,108 8,106 7,307Undeducted payables 171,683 141,816 — —Tax losses 499,344 482,340 311,350 311,350Overseas tax 188,590 220,468 188,590 220,420Deferred tax liabilities:1,218,605 1,128,836 581,507 622,619Revaluation gain of owner-occupiedproperties (139,900) — (138,400) —1,078,705 1,128,836 443,107 622,619Deferred tax assets have not been recognised in respect of the following item:2012 2011RMB’000 RMB’000Tax losses 7,927,125 1,784,749402