25. DEFERRED TAXATION LIABILITIES/(ASSETS)
| | |
| |
1997
£M |
1996
£M |
1995
£M |
|
| Opening balance | | | | (48) | (85) | (46) |
| Arising on acquisitions | | | | - | 18 | (33) |
| Profit and loss account | | | | (10) | 19 | (6) |
|
| Closing balance | | | | (58) | (48) | (85) |
|
| The closing balance is analysed below: |
|
| Timing differences: |
| Fixed asset related | | | | | (1) | 13 | 13 |
| Other | | | | | (57) | (61) | (98) |
|
| | | | | (58) | (48) | (85) |
|
Reuters has provided for all potential deferred tax liabilities in respect of timing differences and has provided for deferred UK income and foreign withholding taxes that will be triggered by the expected future remittance of earnings by overseas subsidiary undertakings. Reuters has not provided for deferred UK income and foreign withholding taxes relating to unremitted earnings where remittance of these earnings is not currently anticipated in the foreseeable future. Reuters estimates that these unrecognised taxes total approximately £114 million at 31 December 1997.
| Total timing differences at 31 December 1997 | | | ASSETS
£M |
VALUATION ALLOWANCE
£M |
LIABILITES
£M |
NET
£M |
|
| Fixed asset related | | | (36) | 7 | 28 | (1) |
| Unrecognised tax losses | | | (18) | 17 | - | (1) |
| Other | | | (84) | 20 | 8 | (56) |
|
| | | (138) | 44 | 36 | (58) |
|
The valuation allowance increased by £10 million during 1997.
Where appropriate deferred tax assets and liabilities are netted for balance sheet presentation purposes. The net deferred tax balance has been analysed as:
| | | | | 1997 £M | 1996 £M | 1995 £M |
|
| Deferred tax debtor (included in debtors - see note 20) | | | | (74) | (69) | (97) |
| Deferred tax liability (included in provisions for liabilities and charges) | | | | 16 | 21 | 12 |
|
|