2004 - Asianbanks.net

(As restated -Note 2)(As restated -Note 2)(In Thousands)Credited to operationsTax effects of:Allowance for probable losses P=7,047,753 P=5,212,453 P=6,687,998 P=4,889,168NOLCO 745,839 785,016 623,788 593,538Unamortized past servicecosts 218,348 207,715 214,390 200,173Capitalized interest (106,641) (113,957) (111,424) (113,957)Lease income/expensedifferential (8,732) 42,360 84,143 83,711Foreign exchange profits (5,921) (1,290) – –Others 16,442 6,057 – –MCIT 109,914 31,694 101,078 27,694P=7,391,834 P=5,541,447 P=6,983,005 P=5,058,612Charged against equityRevaluation increment in property (P=625,168) (P=628,601) (P=616,968) (P=621,715)The Parent Company and certain subsidiaries did not recognize deferred tax assets on the following temporarydifferences:GroupParent Company2004 2003 2004 2003(In Thousands)Allowance for probable losses P=252 P=3,484,644 P=– P=3,019,618NOLCO 2,619,173 7,219,227 2,585,899 6,809,727MCIT 18,905 21,166 14,672 18,630Others 9,763 – – –P=2,648,093 P=10,725,037 P=2,600,571 P=9,847,975Management believes that it is not likely that these temporary differences will be realized in the future.A reconciliation between the statutory income tax to provision for (benefit from) income tax follows:GroupParent Company2003 2002 2003 20022004 (As restated - Note 2) 2004 (As restated - Note 2)(In Thousands)Statutory income tax at 32% P=266,433 P=614,240 P=165,926 P=80,825 P=469,798 P=32,986Tax effects of:FCDU income (746,448) (739,514) (510,398) (746,448) (739,514) (510,398)Tax-exempt and tax-paid income (468,103) (668,591) (386,887) (378,628) (499,881) (250,992)Nondeductible expenses 404,470 553,435 221,042 360,221 405,656 141,414Equity in net losses (earnings) ofsubsidiaries and associates (6,959) (9,497) 11,369 (273,689) (322,579) (242,832)Nondeductible interest expense 111,812 94,704 116,523 110,801 90,254 95,226Others - net 304,154 (113,492) (45,996) 259,285 (4,087) 26,327Unrecognized deferred tax asset (946,987) 794,990 60,457 (970,236) 766,918 20,645Provision for (benefit from) income tax (P=1,081,628) P=526,275 (P=367,964) (P=1,557,869) P=166,565 (P=687,624)EAR expenses of the Parent Company amounted to P=148.9 million and P=132.6 million (included in MiscellaneousExpenses in the statements of income) in 2004 and 2003, respectively. EAR expenses for the period September 1to December 31, 2002 amounted to P=40.1 million.The details of the Parent Company’s NOLCO and MCIT follow:Inception Year Amount Used/Expired Balance Expiry Year(In Thousands)- 72-