2. ACCOUNTING POLICIES (CONTD.) 2.4 SUMMARY OF MATERIAL ACCOUNTING POLICIES (CONTD.) (m) Taxes (i) Current tax Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the reporting date in the countries where the Group and the Company operate and generates taxable income. (ii) Deferred tax Deferred tax is provided using the liability method on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date. The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax assets to be utilised. The Group has adopted International Tax Reform – Pillar Two Model rules upon its release on 2 June 2023. The amendments provide a temporary mandatory relief from deferred tax accounting for the top-up tax which is effective immediately and new disclosures of Pillar Two top-up taxes. The Group has applied a temporary mandatory relief from deferred tax accounting for the impacts of the top-up tax and accounts for it as a current tax when it is incurred. The application of the pronouncement is further discussed in Note 10. (iii) Sales and service tax Indirect taxes include Sales Tax, Service Tax and Goods and Services Tax (also known as Value Added Tax). The amount of indirect taxes payable to taxation authority is included as part of payables in the statements of financial position. Indirect taxes incurred on the purchase of assets or services which cannot be recovered from the respective tax authorities are recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable. The difference between output and input Goods and Services Tax, being the amount payable to or receivable from the respective taxation authorities at the reporting date, is included in other payables or other receivables respectively in the statements of financial position. (n) Government grants Government grants are recognised when there is reasonable assurance that the grant will be received, and all attaching conditions will be complied with. Government grant related to income Government grants are recognised in profit or loss on a systematic basis over the periods in which the entity recognises as expenses the related costs for which the grants are intended to compensate. Grants related to income are deducted from related expenses. Notes to the Financial Statements For the year ended 31 December 2024 UEM EDGENTA BERHAD 294 Integrated Annual Report 2024
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