SEO Version
SABANA
84
using the effective proft rate method.
Finance costs comprise proft expense on Commodity Murabaha Facilities and proft rate swa
transaction costs incurred on Commodity Murabaha Facilities and brokerage and agent fees. All b
recognised in the Statement of Total Return using the effective proft rate method.
(k)
Tax
Tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in the
Return except to the extent that it relates to a business combination, or items directly related to U
which case it is recognised in Unitholders’ funds.
Current tax is the expected tax payable or receivable on the taxable income or loss for the peri
enacted or substantively enacted at the reporting date, and any adjustment to tax payable in r
periods.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of ass
fnancial reporting purposes and the amounts used for taxation purposes. Deferred tax is not reco
•
temporary differences on the initial recognition of assets or liabilities in a transaction tha
combination and that affects neither accounting nor taxable proft or loss; and
•
temporary differences related to investments in subsidiaries to the extent that it is probabl
reverse in the foreseeable future.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences
based on the laws that have been enacted or substantively enacted by the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax li
and they relate to income taxes levied by the same tax authority on the same taxable entity, or on
but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabil
simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differ
that it is probable that future taxable profts will be available against which they can be utilised. Def
reviewed at each reporting date and are reduced to the extent that it is no longer probable that th
will be realised.
The Inland Revenue Authority of Singapore (“IRAS”) has issued a tax ruling on the taxation of th
earned and expenditure incurred after its listing on the SGX-ST. Subject to meeting the terms an
tax ruling issued by IRAS, the Trustee is not subject to tax on the taxable income of the Trust, w
distributions from liquid Islamic debt securities such as sukuks that the Trust may invest in, provide
of the taxable income of the Trust is distributed within the year in which the income is derived (th
treatment”). Instead, the Trustee and the Manager will deduct income tax at the prevailing corporat
17%) from the distributions made to Unitholders that are made out of the taxable income of the Tru
Sabana AR 2011 Financial V9.indd 84
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