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1996/97 STATE TRANSIT ANNUAL REPORT
Financial Statements



3. INCOME TAX 1997
$000
   
(i) Income Tax Expense  
   
The prima facie tax on operating profit differs from the income tax provided in the accounts as follows:  
   
  • Prima facie tax on operating loss
(1,434)
  • Tax effect of permanent differences (net)
(1,102)
Income tax expense (benefit) attributable to operating profit (loss)
(2,536)

   
(ii) Benefit of timing differences not brought to account.  

The future income tax benefit of the Authority arising from timing differences has not been recognised as an asset because realisation of the benefit is not regarded as virtually certain:
 
Timing differences 37,356
   
(iii) Provision for Deferred Income Tax  
   
Tax effect of timing differences (14,013)
Less provision for deferred income tax no longer required due to offset of future income tax benefit of taxation losses 13,138
 
(875)



The future income tax benefit will only be obtained if:

(a) future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;

(b) the conditions for deductibility imposed by tax legislation continue to be complied with; and

(c) no changes in tax legislation adversely affect the Authority in realising the benefit.

The year ended 30 June 1997 is the first year during which the Authority has been subject to full application of the NSW Treasury tax equivalent regime. Prior to that date the Authority was subject only to a phased implementation of that regime. Accordingly, 30 June 1996 comparative figures have not been provided.

The amount charged for income tax in the Income and Expenditure Statement for the year ended 30 June 1996 represents a nominal 36% of operating profit before tax, in accordance with the provisions of the regime applying to the Authority during that year.


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