RCS GROUP CONSOLIDATED FINANCIAL STATEMENTS
1.18 Taxation (continued)
Current taxation is the expected taxation payable/receivable,
calculated on the basis of taxable income for the period,
using the taxation rates enacted or substantively enacted at
the reporting date, and any adjustment of taxation payable/
receivable for previous periods.
Deferred taxation is recognised in respect of temporary
differences between the taxation base of an asset or liability
and its carrying amount. Deferred taxation is not recognised
for the following temporary differences: the initial recognition
of goodwill; the initial recognition of assets and liabilities
in a transaction that is not a business combination and that
affects neither accounting nor taxable profit; and temporary
differences relating to investments in subsidiaries to the
extent that they probably will not reverse in the foreseeable
future. Deferred taxation is measured at the taxation rates
that are expected to be applied to temporary differences when
they reverse, based on the laws that have been enacted or
substantively enacted by the reporting date.
Deferred taxation assets are recognised for all deductible
temporary differences and assessed losses to the extent that
it is probable that taxable profit will be available against
which such deductible temporary differences and assessed
losses can be utilised. Deferred taxation assets are reviewed
at each reporting date and are reduced to the extent that it is
no longer probable that the related taxation benefit will be
Deferred taxation assets and liabilities are off-set if there is a
legally enforceable right to off-set current taxation liabilities
and assets, and they relate to income taxes levied by the
same taxation authority on the same taxable entity, or on
different tax entities, but they intend to settle current taxation
liabilities and assets on a net basis, or their taxation assets
and liabilities will be realised simultaneously.
1.19 Employee benefits
Short-term employee benefits
The cost of all short-term employee benefits are recognised
in the income statement during the period in which the
employee renders the related service.
The accruals for employee entitlements to wages, salaries,
annual and sick leave represent the amount which the
RCS Group has a present obligation to pay as a result of
employees’ services provided to the reporting date. The short-
term benefits have been calculated at undiscounted amounts
based on current wage and salary rates.
Defined contribution plans
The holding company and its subsidiaries contribute to
several defined contribution plans.
A defined contribution plan is a post-employment benefit plan
under which an entity pays fixed contributions into a separate
entity and will have no legal or constructive obligation
to pay further amounts. Obligations for contributions to
defined contribution pension, provident and retirement
funds are recognised as an employee benefit expense in the
income statement as the related service is provided. Prepaid
contributions are recognised as an asset to the extent that
cash refund or a reduction in future payments is available.
Medical aid schemes
The RCS Group contributes to medical aid schemes for the
benefit of permanent employees and their dependants.
The contributions to the schemes are recognised in the
consolidated income statement as the related service is
for the period ended 31 December 2015