Sunny Tew

NOTES TO THE FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2007 (Continued)23. Income tax expenseThe Group2007 2006$ $Current income tax- Current financial year 4,040,921 2,521,331- Under/(Over) provision in prior financial years 192,998 (104,575)4,233,919 2,416,756Deferred tax- Current financial year (14,918) 56,531- Under/(Over) provision in prior financial years 6,818 (2,000)(8,100) 54,531Total income tax expense in consolidated income statement 4,225,819 2,471,287Reconciliation of effective tax rateProfit before income tax 22,538,858 16,347,895Income tax calculated using statutory tax rate of 18% (2006: 20%) 4,056,994 3,269,579Tax effect of:- expenses not deductible for tax purposes 117,712 95,805- tax exempt revenue (47,897) (627,004)Effect of different tax rate in other countries 29,894 24,963Under/(Over) provision in prior financial years 192,998 (104,575)Tax exemption (127,398) (21,567)Under/(Over) provision of deferred tax in prior financial years 6,818 (2,000)Others (3,302) (163,914)4,225,819 2,471,28786 HG METAL MANUFACTURING LIMITED ANNUAL REPORT 2007