1988 — Page 46

NOTES ON THE ACCOUNTS

5 TAXATION

a Taxation in the profit and loss account represents: Provision for Hong Kong profits tax at 17% (1987 18 on the profits of the year Under/(over) provision in respect of prior years

1988

HK$'000

1987 HK$'000

48,100

14,300

25

(822)

48,125

13,478

b Taxation in the balance sheet represents:--

Provision for Hong Kong profits tax for the year Provisional profits tax paid

48,100

14.300

(10,147)

(3.135)

37,953

11,165

Balance of profits tax provision relating to prior years Less: Tax Reserve Certificate purchased under order

6,892

of the Commissioner of Inland Revenue

(6,892)

37,953

11,165

c No provision for deferred taxation has been made as the directors consider that no liability would

likely arise as a result of the reversal of timing differences in the foreseeable future. The full potential liability for deferred taxation calculated on the liability method is as follows:—

Depreciation allowances in excess of

related depreciation

General provisions

42

12

1988 HK$'000

1987 HK$'000

140,229 (39,165)

142,112

(30,672)

101.064

111,440