54 ANNUAL REPORT 2012 Deferred tax assets are offset against deferred tax liabilities within each legal entity The operations of the Company are complex and related tax interpretations regulations and legislation are subject to change The Company believes the amounts reported as deferred income tax liabilities adequately refect managements current best estimate of its income tax exposures see Note 17 Income tax expense December 31 December 31 2012 2011 Current tax on profts for the year 9123 19642 Adjustments in respect of prior years 632 81 Reversal of prior period tax provision 3030 Recovery on settlement of prior year tax reassessment 2900 Total current tax 3825 19561 Origination and reversal of temporary differences 10716 3003 Reversal of prior period tax provision 7520 3088 Impact of change in enacted tax rates on deferred tax balances 1078 2056 Total deferred tax 2118 8147 Income tax expense 5943 11414 The provision for income taxes differs from the result that would be obtained by applying combined Canadian federal and provincial Ontario and Alberta statutory income tax rates to proft or loss before income taxes This difference results from the following December 31 December 31 2012 2011 Proft before income taxes 86884 73557 Statutory income tax rate 2575 2825 Expected income tax expense 22373 20780 Effect on income taxes of Impact of change in enacted tax rates on deferred tax balances 1078 2056 Provincial and foreign rate differences 3377 7547 Reversal of prior period tax provision 10550 3088 Nondeductible notional interest 1017 1641 Nondeductible stockbased compensation expense 326 451 Other nondeductible expenses 767 954 Foreign exchange translation losses 267 244 Reversal of prior year nondeductible interest 1 5 1 1 Taxexempt portion of capital gains 2 Recovery of prior year nondeductible interest 2 9 0 0 Other 609 37 16430 9366 Income tax expense 5943 11414 Deferred taxes have been remeasured to refect statutory enacted future tax rates NOTES TO THE CONSOLIDA TED FINANCIAL ST A TEMENTS DECEMBER 31 2012 AND 2011 IN THOUSANDS OF CANADIAN DOLLARS EXCEPT PER SHARE AMOUNTS