GHL System Berhad Annual Report 2018

G H L S y s t e m S B e r h a d ( 2 9 3 0 4 0 - D ) 88 NOT ES TO THE F I NANC I A L STAT EMENTS 3 1 D e c e m b e r 2 0 1 8 C O N T ’ D 9. TAX EXPENSE (cont’d) (c) The numerical reconciliation between the tax expense and the product of accounting profit multiplied by the applicable tax rates of the Group and of the Company are as follows: Group Company 2018 2017 2018 2017 RM RM RM RM Profit before tax 33,491,693 25,409,775 12,093,291 497,558 Tax at Malaysian statutory tax rate of 24% (2017: 24%) 8,038,006 6,098,346 2,902,390 119,414 Tax effects in respect of: Non-allowable expenses 5,559,489 4,103,203 5,871,718 2,392,892 Non-taxable income (8,442,187) (5,442,672) (8,537,809) (1,769,060) Deferred tax assets not recognised 2,015,712 1,591,156 - - Utilisation of previously unrecognised deferred tax assets - (1,724,280) - - 7,171,020 4,625,753 236,299 743,246 Under/(Over)-provision of income tax expense in prior years 139,671 200,831 (72,671) (144,701) Under-provision of deferred tax in prior years 1,597,339 78,573 16,759 78,573 Tax expense for the financial year 8,908,030 4,905,157 180,387 677,118 (d) Tax savings of the Group and of the Company are as follows: Group Company 2018 2017 2018 2017 RM RM RM RM Arising from utilisation of previously unrecognised deferred tax assets - 1,724,280 - - (e) Tax on each component of other comprehensive income/(loss) is as follows: Group 2018 2017 Before tax Tax effect After tax Before tax Tax effect After tax RM RM RM RM RM RM Foreign currency translations 2,470,283 - 2,470,283 (3,478,849) - (3,478,849)