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Frontken Corporation Berhad (651020-T)
ANNUAL REPORT
2016
14. DEFERRED TAX ASSETS/LIABILITIES (CONT’D)
The net deferred tax liabilities and assets are in respect of the tax effects of the following:
The Group
Deferred Tax
(Assets)/Liabilities
2016
2015
RM
RM
Temporary differences arising from property, plant and equipment
1,477,470
2,091,901
Others
(1,408,735)
(51,581)
68,735
2,040,320
As mentioned in Note 3, the tax effects of deductible temporary differences, unused tax losses and unused tax credits
which would give rise to deferred tax assets are recognised to the extent that it is probable that future taxable profits
will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be
utilised. As of 31 December 2016, the estimated amount of net deferred tax assets, calculated at the current tax rate
which has not been recognised in the financial statements of the Group due to uncertainty of its realisation, is as follows:
The Group
Deferred Tax
(Assets)/Liabilities
2016
2015
RM
RM
Unutilised tax losses
1,431,749
2,737,961
Unabsorbed capital allowances
173,851
184,850
Temporary differences arising from property, plant and equipment
(283,821)
(533,551)
Others
(10,460)
(213,513)
1,311,319
2,175,747
The unutilised tax losses and unabsorbed capital allowances are subject to the agreement of the tax authorities.
15. FIXED DEPOSITS WITH LICENSED BANKS
Fixed deposits with licensed banks of the Group earn effective interests ranging from 0.25% to 3.45% (2015: 0.25% to
4.15%) per annum. The fixed deposits of the Group have average maturity periods ranging from 10 to 365 days (2015:
14 to 365 days).
Fixed deposits with licensed banks of the Company earn an effective interest of 2.95% (2015: ranging from 3.05% to
4.15%) per annum. The fixed deposits of the Company have a maturity period of 30 days (2015: ranging from 14 to 91
days).
The fixed deposits of the Group and of the Company amounting to RM3,205,263 (2015: RM4,680,237) and RM1,072,697
(2015: RM1,040,444) are pledged to licensed banks as security for banking facilities granted to the Group and the
Company.
Pursuant to the Service Agreements entered between TTES and its customer, TTES is required to pledge the fixed
deposits with licensed bank amounted to RM1,146,156 (2015: NIL) as security for the bank guarantee which are
provided for projects that are secured by TTES. As the availability period of the bank guarantee facility for these projects
are more than a year, hence, the fixed deposits with licensed banks are classified as non-current assets.
Notes To The Financial Statements
(cont’d)