Download - Axiata Group Berhad - Investor Relations

Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 20094. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)(l)LeasesLease of assets where a significant portion of the risks and rewards of ownership are retained by the lessor areclassified as operating leases. Payments made under operating leases (net of any incentives received from thelessor) are charged to the Income Statement on a straight line basis over the lease period.When an operating lease is terminated before the lease period has expired, any payment required to be made tothe lessor by way of penalty is recognised as an expense in the period in which termination takes place.Upfront payments on leasehold land are classified as prepaid lease payments and amortised on a straight line basisover the remaining lease period.(m) Income taxesCurrent tax expense is determined according to the tax laws of each jurisdiction in which the Group operates andinclude all taxes based upon the taxable profits, including withholding taxes payable by foreign subsidiaries, jointlycontrolled entities or associates on distributions of retained earnings to companies in the Group, and real propertygains taxes payable on disposal of properties.Deferred tax is recognised in full, using the liability method, on temporary differences arising between the amountsattributed to assets and liabilities for tax purposes and their carrying amounts in the financial statements. Howeverdeferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction otherthan a business combination that at that time of the transaction affects neither accounting nor taxable profit orloss.Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available againstwhich the deductible temporary differences or unutilised tax losses can be utilised.The Group’s share of income taxes of jointly controlled entities and associates are included in the Group’s shareof results of jointly controlled entities and associates.Deferred tax is determined using tax rates (and tax laws) that have been enacted or substantially enacted by thebalance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred taxliability is settled.(n)ProvisionsProvisions are recognised when the Group and the Company have a present legal or constructive obligation as aresult of past events, when it is probable that an outflow of resources will be required to settle the obligation,and when a reliable estimate of the amount can be made. Where the Group expects a provision to be reimbursed(for example, under an insurance contract), the reimbursement is recognised as a separate asset but only whenthe reimbursement is virtually certain. Provisions are not recognised for future operating losses.Axiata Group Berhad • 186