20. Income taxes

The components of income tax expense for the years ended December 31, 2011, 2010 and 2009 were as follows:


  2011 2010 2009
Current income tax expense      
Income tax for the year (8,715) (9,625) (7,225)
Adjustments of the current income tax for previous years (41) 41 159
Total current income tax for the year (8,756) (9,584) (7,066)
Deferred tax expense      
Origination and reversal of temporary differences (1,867) (719) (752)
Changes in unused tax losses (332) 262 (256)
Total deferred income tax (2,199) (457) (1,008)
Total income tax expense for the year (10,955) (10,041) (8,074)

A reconciliation of the theoretical tax charge to the actual income tax charge is as follows:


  2011 2010 2009
Profit before tax 57,025 41,379 34,337
Statutory income tax rate 20% 20% 20%
Theoretical tax charge at statutory income tax rate (11,405) (8,276) (6,867)
Adjustments of the current income tax for previous years (41) 41 159
Non-deductible expenses and non-taxable income 918 (2,009) (1,045)
Tax on intragroup dividend income (44) (84) (134)
Changes in unrecognized deferred tax assets (513) 262 (256)
Tax exemptions 57 60 35
Other 73 (35) 34
Total actual income tax (10,955) (10,041) (8,074)
Effective tax rate, % 19.21% 24.27% 23.51%

Non-deductible expenses and non-taxable income comprised the following amounts for the year ended december 31, 2011, 2010 and 2009:


  2011 2010 2009
Effect of employee benefits curtailment 1,023 - -
Effect of business combination achieved in several stages 388 - -
Reversal/ (accrual) of impairment loss 665 (665) -
Other (1,158) (1,344) (1,045)
Total non-deductible expenses and non-taxable income 918 (2,009) (1,045)

Other non-deductible expenses and non-taxable income include income connected with depreciation of certain property, plant and equipment, expenses within share-based employee motivation program, promotional and sponsorship expenditures, travel expenditures in excess of certain statutory allowances, other expenses and value added tax accrued on free-of-charge services.

The components of net deferred tax assets and liabilities as at December 31, 2011, 2010 and 2009, and the respective movements during 2011, 2010 and 2009 were as follows:


      Movement during 2011
recognized in
 
  Balance as
at 1
January 2011
Acquisition
through business
combinations
Other
comprehensive
income
Profit / or
loss for
the year
Balance as
at December 31,
2011
Tax effects of future tax
deductible items
         
Property, plant and equipment - 9 - 224 233
Unused tax losses 240 476 - (332) 384
Trade and other accounts receivable 35 4 - 28 67
Inventories 9 1 - 42 52
Investments 469 1 - (470)
Employee benefits 1,880 - - 104 1,984
Loans and borrowings 1,311 - - (927) 384
Other non-current liabilities 85 - - 469 554
Accounts payable, provisions and accrued expenses 1,245 19 - 282 1,546
Other 782 30 - (737) 75
Gross deferred tax asset 6,056 540 - (1,317) 5,279
Tax effects of future taxable
items:
         
Property, plant and equipment (14,709) (788) - (2,051) (17,548)
Intangible assets (1,495) (3,621) - 814 (4,302)
Investments (604) - (4) 447 (161)
Accounts payable, provisions and accrued expenses (522) (55) - 338 (239)
Trade and other accounts receivable (410) (3) - (266) (679)
Loans and borrowings (13) (49) - 9 (4)
Other (54) (6) - (173) (233)
Gross deferred tax liability (17,807) (4,473) (4) (882) (23,166)
Net deferred tax liability (11,751) (3,933) (4) (2,199) (17,887)

      Movement during 2010
recognized in
 
  Balance
as at 1
January 2010
Acquisition
through business
combinations
Other
comprehensive
income
Profit / or
loss for
the year
Balance
as at 31
December 2010
           
Tax effects of future tax
deductible items
         
Trade and other receivables 58 - - (23) 35
Inventories 15 - - (6) 9
Investments 234 - - 235 469
Pension liability 1,806 - - 74 1,880
Leasing 395 - - (94) 301
Non-current borrowings 960 - - (326) 634
Non-current other liability 35 - - 1 36
Current borrowings 469 - - (93) 376
Trade and other payables 1,176 - - 69 1,245
Provisions 111 - - (111) -
Deferred income 57 - - (8) 49
Other 550 - - 472 1,022
Gross deferred tax asset 5,866 - - 190 6,056
           
Tax effects of future taxable
items:
         
Property, plant and equipment (14,264) (344) - (101) (14,709)
Intangible assets (1,879) 22 - 362 (1,495)
Investments (98) - (41) (465) (604)
Trade and other payables (347) - - (175) (522)
Trade and other receivables (165) - - (245) (410)
Loans and borrowings (12) - - (42) (54)
Other (32) - - 19 (13)
Gross deferred tax liability (16,797) (322) (41) (647) (17,807)
Net deferred tax liability (10,931) (322) (41) (457) (11,751)

      Movement during 2009
recognized in
 
  Balance as at 1
January 2009
Acquisition
through
business
combinations
Other
comprehensive
income
Profit / or loss
for the year
Balance as at 31
December 2009
           
Tax effects of future tax
deductible items
         
Trade and other receivables 174 - - (116) 58
Inventories 21 - - (6) 15
Investments 223 - (82) 93 234
Pension liability 1,656 - - 150 1,806
Leasing 700 1 - (306) 395
Non-current borrowings 633 - - 327 960
Non-current other liability 29 - - 6 35
Current borrowings 318 - - 151 469
Trade and other payables 995 - - 181 1,176
Provisions 39 - - 72 111
Deferred income 64 - - (7) 57
Other 88 - - 462 550
Gross deferred tax asset 4,940 1 (82) 1,007 5,866
           
Tax effects of future taxable
items:
         
Property, plant and equipment (12,721) (18) - (1,525) (14,264)
Intangible assets (1,793) - - (86) (1,879)
Investments (49) - - (49) (98)
Trade and other payables 15 - - (362) (347)
Trade and other receivables (127) 1 - (39) (165)
Loans and borrowings (27) - - 15 (12)
Other (63) - - 31 (32)
Gross deferred tax liability (14,765) (17) - (2,015) (16,797)
Net deferred tax liability (9,825) (16) (82) (1,008) (10,931)

Taxable temporary differences associated with investments in subsidiaries for which no deferred tax liabilities were recognized in the accompanying consolidated statements of financial position as at 31 December 2011, 2010 and 2009 amounted to 18,324, 8,001 and 6,508, respectively. Deductible temporary differences associated with investments in subsidiaries for which no deferred tax assets were recognized in the accompanying consolidated statements of financial position as at December 31, 2011, 2010 and 2009 amounted to 2,842, 379 and 379, respectively.

Deductible temporary differences for which no deferred tax assets were recognized in the accompanying consolidated statements of financial position as at December 31, 2011, 2010 and 2009 amounted to 5,666, 3,103 and 4,475, respectively, of which unused tax losses with expiry date from 2013 to 2021 amounted to 4,418, 1,866 and 2,601 for 2011, 2010 and 2009, respectively.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and the deferred income tax assets and deferred income tax liabilities relate to the income taxes levied by the same fiscal authority on the same taxable entity.

The consolidated statement of comprehensive income for 2011, 2010 and 2009 includes tax expense in respect of following items of other comprehensive income:


  2011 2010 2009
Change in fair value of available-for-sale financial assets (4) (41) (82)

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