Egyptian Resorts Company “Egyptian Joint Stock ... - ERC Egypt

- 25 - Translated & OriginallyIssued in Arabic22-5 Movable taxThere has been an inspection for the company’s books from the date ofactivity’s inception till year 2004 by the Tax Authority for corporatecompanies and there has been an assessment and it has been paid.Second: Tax position for the subsidiary company (Sahl Hasheesh fortouristic investment) as per what was presented in the consolidated financialstatements as at March 31, 2011 which complies with the tax system of ArabRepublic of Egypt in practice22-6 Corporate income tax- The company is subject to the provisions of law no. 8/1997 related to theissuance of guarantee and incentive investments law and its executiveregulations. Based on this law which has been issued on November 9, 2008,the company is exempted from corporate tax from 1/2/2008 till December31, 2018 for the specified purpose mentioned in the company’s tax card.- The tax inspection and the final assessment for the movable taxes and salarytax were made and the due amounts paid till year 2005.- The company also submitted its tax returns for the years 2004, 2005, 2006,2007, 2008 , 2009 and 2010.22-7 Salary taxThere has been an inspection for the salary tax of the company till December31, 2006 and there has been tax assessment and the resulting tax differenceshave been paid.23- Financial Instruments and Risk ManagementThe Company’s financial instruments are represented in financial assets (cash atbanks and on hand, financial investments, accounts & other notes receivables,debtors & debit balances) and the financial liabilities ( creditors, receivables creditbalances, purchase of land creditors, suppliers and contractors, other creditbalances and banks over draft).23-1 Fair ValueFair value of the financial instruments reflects the reciprocal value of the assetor settlement of a liability between parties has the desire and the capability totrade with a free will, the book value of the financial instruments as at thebalance sheet date is almost equivalent to its fair value other than the financialinvestments not registered in the Stock exchange market which are recorded atcost and its difficult to determine its fair value.23-2 Foreign Currency Fluctuation RiskForeign currency risk represents the risk of fluctuation in exchange rates, whichin turn affects the company’s cash inflows and outflows in foreign currency aswell as the value of its foreign monetary assets and liabilities as of the date ofthe financial position the company has foreign currency assets & liabilities