BCH Commercial Investments Limited

Income tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement of comprehensive income because of items of income or expense that are taxable or deductible in other year and items that are never taxable or deductible. The company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax is recognised on timing differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable timing differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible timing differences can be utilised. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. The measurement of deferred tax liabilities and asset reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Current or deferred tax for the year is recognised in profit or loss, except when they related to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax is also recognised in other comprehensive income or directly in equity respectively.

Investments in Jointly Controlled Entities

Investments in jointly controlled entities are accounted for in accordance with the provisons of FRS 102 section 1A Small Entities. The cost model has been chosen and Investments in jointly controlled entities are therefore shown at cost less any accumulated impairment losses.

Dividends and other distributions received from jointly controlled entities are recognised as income without regard to whether the distributions are from accumulated profits of the jointly controlled entities arising before or after the date of acquisition.

Investments in Associate Entities

Investments in associates are accounted for in accordance with the provisions of FRS 102 section 1A Small Entities. The cost model has been chosen and investments in associated entities are therefore shown at cost less any accumulated impairment losses.

Dividends and other distributions received from associate entities are recognised as income without regard to whether the distributions are from accumulated profits of the associate entities arising before or after the date of acquisition.

In the event that the recoverable amount of an investment in an associate or a jointly controlled entity is less than its carrying amount, the company will reduce the carrying amount to the recoverable amount. The reduction will be an Impairment loss and this will be recognised in the profit and loss account for the period of account.