Overview
Report of the
Executive Board
Report of the
Supervisory Board
Financial statements
Other information
(r) Interest income, interest expenses and other net finance income and expenses
Interest income and expenses are recognised as they accrue in profit or loss, using the effective interest method unless collectability is in doubt.
Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in profit or loss using
the effective interest method.
Other net finance income and expenses comprises dividend income, gains and losses on the disposal of available-for-sale investments, changes in the
fair value of investments designated at fair value through profit or loss and held for trading investments, changes in fair value of hedging instruments
that are recognised in profit or loss, unwinding of the discount on provisions and impairment losses recognised on investments. Dividend income is
recognised in the income statement on the date that HEINEKEN's right to receive payment is established, which in the case of quoted securities is the
ex-dividend date.
Foreign currency gains and losses are reported on a net basis in the other net finance income and expenses.
(s) Income tax
Income tax comprises current and deferred tax. Current tax and deferred tax are recognised in the income statement except to the extent that it relates
to a business combination, or items recognised directly in equity or in other comprehensive income.
(i) Current tax
Current tax is the expected income tax payable or receivable in respect of taxable income or loss for the year, using tax rates enacted or substantively
enacted at the balance sheet date, and any adjustment to income tax payable in respect of previous years. Current tax payable also includes any tax
liability arising from the declaration of dividends.
(ii) Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes
and their tax bases.
Deferred tax is not recognised for:
temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit or loss;
temporary differences related to investments in subsidiaries, associates and jointly controlled entities to the extent that the Company is able
to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future; and
taxable temporary differences arising on the initial recognition of goodwill.
The measurement of deferred tax assets and liabilities reflects the tax consequences that would follow 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.
Deferred tax is determined using tax rates (and laws) that have been enacted or substantively enacted at the balance sheet date and are expected
to apply when the related deferred tax asset is realised or the deferred tax liability is settled.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes
levied by the same tax authority on the same taxable entity, or on different taxable entities which intend either to settle current tax liabilities and assets
on a net basis, or to realise the assets and settle the liabilities simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future
taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each balance sheet date and are reduced to the
extent that it is no longer probable that the related tax benefit will be realised.
Heineken N.V. Annual Report 2012
89
