246 WASCO BERHAD SECTION 6 FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2025 7 DEFERRED TAX ASSETS/(LIABILITIES) (CONTINUED) Group Company 2025 RM’000 2024 RM’000 2025 RM’000 2024 RM’000 Subject to income tax Deferred tax assets (before offsetting) - Unused tax losses 1,074 1,451 - - - Property, plant and equipment - - 4 - - Provisions and accruals 15,759 17,317 - - - Unrealised foreign exchange losses 1,975 2,447 - - - Others 1 8 - - 18,809 21,223 4 - Offsetting (5,501) (9,245) - - Deferred tax assets (after offsetting) 13,308 11,978 4 - Deferred tax liabilities (before offsetting) - Property, plant and equipment (9,474) (10,984) - - - Unrealised foreign exchange gains (302) (933) - - - Others (1,067) (963) - - (10,843) (12,880) - - Offsetting 5,501 9,245 - - Deferred tax liabilities (after offsetting) (5,342) (3,635) - - Recognition and measurement Deferred tax is recognised in full, using the liability method, on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which the deductible temporary differences or unused tax losses can be utilised. Deferred tax assets are recognised for all unused tax losses, unabsorbed capital allowances and other deductible temporary differences to the extent that it is probable that taxable profit will be available against which the tax losses, capital allowances and other deductible temporary differences can be utilised. Significant judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits. Assumptions about generation of future taxable profits depend on the Group’s estimate of projected future cash flows. These judgements and assumptions are subject to risks and uncertainty, hence there is a possibility that changes in circumstances will alter expectations, which may impact the amount of deferred tax assets recognised in the statements of financial position and the amount of unused tax losses, unabsorbed capital allowances and unutilised temporary differences that remain unrecognised. Key estimates The Group concluded that the deferred tax assets will be recoverable using the estimated future taxable income of the subsidiaries of the Company. It is estimated that the secured project and unsecured project with high probabilities of successful award which will contribute to the future taxable income at the subsidiaries.
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