Page 70 - InterEnergo - Annual Report 2020
P. 70

Interenergo                       Accounting report                                                                    Interenergo                       Accounting report

            •   Sale of services: the control over services is transferred to the customer in the moment when the service          Deferred tax is provided, taking into account temporary differences between the carrying amounts of assets
                is performed. Revenue from rendered trading, energy and engineering services are recognised in the                 and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets
                reporting period in which the services are performed. Revenue from services rendered is recognized                 also arise from unused tax losses and unused tax credits.
                in the income statement based on the stage of completion of the transaction at the end of the reporting            Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available
                period. The stage of completion is assessed by reviewing the work performed.
                                                                                                                                   against which the asset can be utilized. Future taxable profit, on the basis of which deferred tax assets from
            •   Commission services: the Company has a contract with the parent company, where it acts as a commission             deductible temporary differences may be recognized, includes temporary differences that will arise from the
                agent who pursuant to the contract conducts electricity trading on behalf of the client, for which it charges      elimination of existing temporary tax differences if those differences relate to the same tax authority in respect
                a commission fee. The Company is under the contract entitled to a fixed monthly part of the commission             of the same taxable unit or to different taxable units that intend to repay tax liabilities or receive payment of
                and a variable part of the commission, which is determined at the end of the accounting period. During the         deferred tax assets in a set-off amount or that intend to repay tax liabilities or receive payment of deferred
                provision of services, the Company does not bear the risk of losses that would arise from the concluded            tax assets at the same time. The same criteria are adopted in determining whether existing taxable temporary
                commission transactions, as these are borne by the client. As the Company does not bear the risk of                differences support the recognition of a deferred tax asset due to unused tax losses and credits i.e.  these
                losses that must be settled by the client under the contract, the Company deemed that it acts as an agent          differences are taken into account if they relate to the same tax authority and the same taxpayer and are
                in this contract. Revenue is recognized on a net basis, in the amount of the commission as defined under           expected to be eliminated in the period or periods in which the tax loss or credit can be used.
                the contract. Revenue is recognized gradually according to the stage of completion of the enforcement              The amount of recognized deferred tax is measured based on the expected manner of realisation or settlement
                                                                                                                                   of the carrying amount of assets and liabilities using tax rates that have been enacted or substantively enacted
            Employee benefits                                                                                                      by the end of the reporting period. Deferred tax assets and liabilities are not discounted.
                                                                                                                                   The carrying amount of a deferred tax asset is reviewed at the end of each reporting period and reduced to
            Salaries, allowances, paid annual leave and defined retirement benefit plans and non-cash benefit costs are            the extent that it is no longer probable that sufficient taxable profit will be available against which the related
            recognized as a liability in profit or loss or in costs related to services during the period in which they are        tax benefit can be utilized. Any such reduction shall be reversed if it is probable that sufficient taxable profit
            incurred by employees.                                                                                                 will be available.

            Finance income and finance costs                                                                                       Accounted taxes, deferred taxes and their changes are presented separately and are not offset. Accounted tax
                                                                                                                                   receivables are offset by current tax liabilities, and deferred tax assets are offset by deferred tax liabilities if
            Finance income and finance costs comprise:                                                                             the Company has legally enforceable rights to offset accounted tax receivables with short-term tax liabilities
                                                                                                                                   and the following additional conditions are met:
            •   interest income;
                                                                                                                                   •   in case of accounted tax receivables and liabilities: the Company intends to either settle the net amount
            •   dividend income;                                                                                                       or liquidate the asset and settle its liability at the same time, or
            •   interest expenses;                                                                                                 •   in case of deferred tax assets and deferred tax liabilities: in the case of income taxes levied by the same tax
            •   expenses for impairment of investments, and                                                                            authority on the same taxable person or on different taxable persons and intended for any future period
                                                                                                                                       in which significant future payments are expected to be settled or recovered the amounts of deferred tax
            •   foreign exchange differences arising on revaluation of financial assets and financial liabilities.
                                                                                                                                       liabilities or assets, either to cash in the accounted tax receivables and settle the net amount of the tax
            Dividend income is recognized in the income statement on the date the Company obtains the right to receive                 liability, or to cash and settle at the same time.
            the dividend.
                                                                                                                                   Provisions and contingent liabilities
            When calculating finance income and costs, the effective interest rate is applied to the gross carrying amount
            of the asset (when the asset is not impaired) or the amortised cost of the financial liability. For financial assets   Provisions are recognized when the Company has a present legal or constructive obligation as a result of a past
            that were impaired after their initial recognition, financial income is calculated from the amortised cost (gross      event, which can be estimated reliably, and it is probable that an outflow of resources embodying economic
            carrying amount of the impairment loss), whereas it is recalculated from the gross carrying amount when the            benefits will be required to settle the obligation. Where the time value of money is significant, provisions are
            asset is no longer financially impaired.
                                                                                                                                   stated at the present value of the expected costs of settling the liability.
            Income tax expense                                                                                                     When it is unlikely that an outflow of economic benefits will be required or if the amount cannot be estimated
                                                                                                                                   reliably, a contingent liability is disclosed unless the probability of an outflow of economic benefits is low.
            Income tax for the financial year comprises current tax and changes in deferred tax assets and deferred tax            Possible liabilities, the existence of which will be confirmed only by the occurrence or absence of one or more
            liabilities. Current tax and changes in deferred tax assets and liabilities are recognized in the income statement,    future events, are also disclosed as contingent liabilities, unless the probability of an outflow of economic
            except to the extent that it relates to items recognized directly in other comprehensive income or directly in         benefits is low.

            Current tax is the tax expected to be payable on the taxable profit for the financial year, using tax rates enacted
            or substantively enacted at the reporting date, and includes any adjustments to tax liabilities in respect of
            previous years.

            68    Integrated Annual Report 2020                                                                                                                                                       Integrated Annual Report 2020  69
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