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FRONTKEN CORPORATION BERHAD
(651020-T)
ANNUAL REPORT
2015
14.
DEFERRED TAX ASSETS/LIABILITIES (CONT’D)
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 2015, 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:
Deferred Tax
(Assets)/Liabilities
2015
2014
RM
RM
Unutilised tax losses
2,592,164
3,545,134
Unabsorbed capital allowances
89,379
279,451
Temporary differences arising from property, plant and equipment
929,185
(353,527)
Unutilised reinvestment allowances
-
407,000
Others
(14,376)
(143,406)
3,596,352
3,734,652
The unutilised tax losses, unabsorbed capital allowances and unutilised reinvestment allowances are subject to the
agreement of the tax authorities.
15.
FIXED DEPOSITS WITH LICENSED BANKS
Fixed deposits with licensed banks of the Group and of the Company earn effective interests ranging from 0.25% to
4.15% (2014: 0.25% to 3.60%) and 3.05% to 4.15% (2014: 2.90% to 3.60%) per annum. The fixed deposits of the
Group and of the Company have average maturity periods ranging from 14 to 365 days (2014: 14 to 365 days) and 14
to 91 days (2014: 14 to 93 days).
The fixed deposits of the Group and of the Company amounting to RM4,680,237 (2014: RM4,240,380) and RM1,040,444
(2014: RM1,008,049) are pledged to licensed banks as security for banking facilities granted to the Group and the
Company.
Pursuant to the Services Agreement (“SA”) entered between TTES and its customers, TTES is required to pledge
the fixed deposits with licensed banks as security for the projects that are secured by TTES. Based on the SA, the
projects will be completed by March 2016. Hence, the fixed deposits are classified as non-current assets in the previous
financial year.
16.
INVENTORIES
The Group
2015
2014
RM
RM
Raw materials
5,198,968
4,001,682
Work-in-progress
5,128,338
6,125,305
Finished goods
1,466,141
145,387
11,793,447
10,272,374
Recognised in profit or loss:
Inventories recognised as cost of sales
22,050,743
22,820,559
Amount written down to net realisable value
52,272
937,972
Inventories written off
146,823
-
NOTES TO THE FINANCIAL STATEMENTS
(cont’d)