IBERSOL | 2019 Annual Report

Consolidated Financial Statements When any group company acquires shares in the parent company (own shares), the amount paid, including costs directly attributable (net of taxes), is deducted from the equity attributable to the shareholders of the parent company until the shares are cancelled, re-issued or sold. When those shares are subsequently sold or re-is- sued and after deducting directly imputable transaction costs and taxes, any receipt is included in the equity of the company’s shareholders. 2.14 LOANS OBTAINED Loans obtained are initially recognised at the fair value, including incurred transac- tion costs. Medium and long term loans are subsequently presented at cost minus any amortisation; any difference between receipts (net of transaction costs) and the amortised value is recognised in the consolidated statement of comprehensive income during the loan period, using the effective rate method. Loans obtained are classified in current liabilities, except when the group is entitled to an unconditional right to defer the liquidation of the liability for at least 12 months after the consolidated statement of financial position date. 2.15 INCOME TAX AND DEFERRED TAXES Income tax is calculated based on the taxable results of the companies included in the consolidation in accordance with the tax rules in force at the location of the hea- dquarters of each company included in the consolidation perimeter. In Portugal, the estimated income tax was determined under the Special Tax Regime for Company Groups (RETGS). In the Spanish segment, the current tax of the subsidiaries based in Vigo, Madrid and Barcelona – Spain (except Cortsfood and Dehesa) was calcula- ted under the special tax regime for economic groups. The remaining subsidiaries, based in Luanda - Angola, calculate their current tax individually, in the light of the regulations in force in the country of their registered office (Note 5). Deferred taxes are recognised overall, using the liability method and calculated ba- sed on the temporary differences arising from the difference between the taxable base of assets and liabilities and their values in the consolidated financial state- ments. However, if the deferred cost arises from the initial recognition of an asset or liability in a transaction that is not a corporate concentration or that, on the transac- tion date, does not affect the accounting result or the tax result, this amount is not accounted. Deferred taxes are determined by the tax (and legal) rates decreed or substantially decreed on the date of the consolidated statement of financial position and that can be expected to be applicable in the period of the deferred tax asset or in the liquidation of the deferred tax liability. Deferred tax assets are recognised insofar as it will be probable that future taxable income will be available for using the respective temporary difference. 226