Orbit Garant 2012 annual rep O rt 55 15 INCOME TA x ES Income tax expense comprises the following June 30 June 30 2012 2011 Current tax Current year 4713 5569 Prior year adjustments 3 78 4710 5647 Deferred tax Current year 11 348 Effect of corporate tax rate modifcation 23 3 12 345 4722 5302 Income tax expense differs from the amounts calculated by applying Canadian statutory rates federal and provincial with detai ls as follows June 30 June 30 2012 2011 Earnings before income taxes 15082 16748 Statutory rates 2727 2920 Income taxes based on statutory rates 4112 4890 Increase decrease of income taxes to the following Nondeductible expenses and other 304 193 Nondeductible sharebased compensation expense 275 239 Nontaxable share in net earnings of a company subject to signifcant infuence 66 Effect of corporate tax rate modifcation 23 3 Prior year adjustments 3 78 Nontaxable portion of capital gain 3 69 Change in fair value of contingent consideration 14 34 Total income taxes 4722 5302 Deferred income taxes are based on differences between the accounting and tax values of assets and liabilities and consis t of the following as at the dates presented Recognized in Business June 30 statements of acquisitions June 30 2011 earnings Note 2 2012 Deferred income tax assets Share issue costs 217 217 Longterm investments Total deferred income tax assets 217 217 Deferred income tax liabilities Property plant and equipment 1098 344 577 2019 Intangible assets 1734 549 281 1466 Total deferred income tax liabilities 2832 205 858 3485 Net deferred income tax liabilities 2615 12 858 3485