ANNUAL REPORT 2013

FINANCIALS

9. Income taxes


Income taxes in the income statement

EUR million 2013 2012
Current year income taxes -19.4 -20.7
Prior year income taxes 0.6 -0.1
Change in deferred taxes 4.4 -0.7
Income taxes total -14.3 -21.5








Reconciliation of income taxes

EUR million 2013 2012
Tax rate for the parent company 24.5% 24.5%
Profit before taxes 108.3 200.4
Income tax using the domestic corporation tax rate -26.5 -49.1
Effect of tax rates in foreign jurisdictions -1.5 -4.0
Income tax for prior years 0.6 -0.1
Impact of associate 11.2 11.7
Effect of sales of Wärtsilä shares
22.9
Other tax exempt items 0.3 1.0
Non-deductible expenses -0.9 -0.9
Effect of change of tax rates 6.9 0.0
Tax booked against unbooked tax assets and unrecognized tax on loss -4.2 -3.5
Change in valuation of tax assets -0.8 0.5
Other items 0.6 0.0
Income taxes recognized in profit and loss -14.3 -21.5








Taxes in other comprehensive income

2013






EUR million Total Tax Net
Translation differences -8.5
-8.5
Change in associate recognized directly in other comprehensive income -13.9
-13.9
Cash flow hedges 0.8 -0.3 0.5
Defined benefit plan actuarial gains (losses) -0.2 0.0 -0.2
Defined benefit plan actuarial gains (losses), change in associate -5.6
-5.6
Other comprehensive income for the period, total -27.5 -0.2 -27.7








2012






EUR million Total Tax Net
Translation differences -1.0
-1.0
Change in associate recognized directly in other comprehensive income 0.1
0.1
Cash flow hedges -1.1 0.3 -0.8
Defined benefit plan actuarial gains (losses) -0.8 0.3 -0.5
Defined benefit plan actuarial gains (losses), change in associate


Other comprehensive income for the period, total -2.8 0.6 -2.2

Deferred income taxes in the balance sheet

2013






Deferred tax assets
Recognized Recognized Transfers




in in other and Acquisitions


Jan 1, income comprehensive translation and Dec 31,
EUR million 2013 statement income difference divestments 2013
Post-employment benefit 2.7 -0.1 -0.2 -0.1 0.0 2.3
Provisions and accruals 10.1 -1.1
5.5 2.0 16.5
Effects on consolidation and eliminations 0.5 -0.6
0.4 -0.3 0.0
Property, plant & equipment 0.6 -0.1
0.0 3.1 3.5
Tax losses and credits carried forward net of valuation allowance 8.6 -1.5
1.2 5.1 13.5
Other temporary differences 6.1 -0.6 -0.3 -5.4 0.3 0.2
Total deferred tax assets 28.6 -3.9 -0.4 1.6 10.3 36.1
Offset against deferred tax liabilities -2.9 -1.9


-4.8
Net deferred tax assets 25.8 -5.9 -0.4 1.6 10.3 31.3








Deferred tax liabilities
Recognized Recognized Transfers




in in other and Acquisitions


Jan 1, income comprehensive translation and Dec 31,
EUR million 2013 statement income difference divestments 2013
Property, plant & equipment 3.6 0.1
0.2
3.9
Fair value adjustments 13.0 -3.2


9.8
Effects on consolidation and eliminations* 26.0 -5.8
0.6 5.4 26.3
Other temporary differences 4.6 0.5 -0.2 -0.2
4.7
Total deferred tax liabilities 47.1 -8.3 -0.2 0.6 5.4 44.6
Offset against deferred tax assets -2.9 -1.9


-4.8
Net deferred tax liabilities 44.3 -10.3 -0.2 0.6 5.4 39.8








Deferred tax assets (+) / liabilities (-), net -18.5



-8.5








* Consist mainly of adjustments to fair value in acquisitions.
2012






Deferred tax assets

Recognized Recognized Transfers




in in other and



Jan 1, income comprehensive translation Dec 31,
EUR million 2012 statement income difference 2012
Post-employment benefit 2.6 0.0 0.2 -0.0 2.7
Provisions and accruals 10.0 0.2
-0.0 10.1
Effects on consolidation and eliminations 1.3 -0.6
-0.2 0.5
Property, plant & equipment 0.7 -0.1
0.0 0.6
Tax losses and credits carried forward net of valuation allowance 7.1 0.6
0.9 8.6
Other temporary differences 6.1 0.8 0.2 -1.0 6.1
Total deferred tax assets 27.8 0.8 0.4 -0.4 28.6
Offset against deferred tax liabilities -0.8 -2.1
0.0 -2.9
Net deferred tax assets 27.0 -1.3 0.4 -0.4 25.8








Deferred tax liabilities

Recognized Recognized Transfers




in in other and



Jan 1, income comprehensive translation Dec 31,
EUR million 2012 statement income difference 2012
Property, plant & equipment 4.5 -0.6
-0.4 3.6
Fair value adjustments 11.5 1.5

13.0
Effects on consolidation and eliminations* 26.4 -0.3

26.0
Other temporary differences 3.5 0.9 -0.2 0.4 4.6
Total deferred tax liabilities 45.8 1.6 -0.2 -0.0 47.1
Offset against deferred tax assets -0.8 -2.1
0.0 -2.9
Net deferred tax liabilities 45.0 -0.5 -0.2 -0.0 44.3








Deferred tax assets (+) / liabilities (-), net -18.0


-18.5








* Consist mainly of adjustments to fair value in acquisitions.


Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred taxes relate to the same fiscal authority. The Group has full control of the timing of dividend distribution in subsidiaries and therefore no deferred tax liability has been recorded. Associate Wärtsilä is a public company and its distribution of profit is tax exempt for Fiskars. Taxes relating to cash flow hedges and actuarial gains and losses have been recorded into other comprehensive income. The deferred tax asset on tax losses carried forward, net of valuation allowance amounted to EUR 13.5 million (8.6) at the end of financial year. Deferred tax allowance is recorded to offset deferred tax assets in order to recognize the deferred tax assets only to the extent that it is probable that future taxable profits will be available. The tax losses carried forward on the basis of which the deferred tax asset is recognized will not expire in the following five years. Income taxes recorded in the income statement and in other comprehensive income are specified earlier in this note 9.