This excerpt taken from the CRXL 20-F filed Jun 13, 2007.
Utilization of tax carry forward losses
We are required to estimate our income taxes in jurisdictions in which we operate. This involves estimating our actual current tax exposure together with assessing the valuation for carry forward losses and temporary differences resulting from different treatment for tax purposes compared to IFRS. These temporary differences mainly relate to intangible fixed assets, property, plant and equipment and inventories.
As at December 31, 2006 we have tax carry forward losses for 222,238 (2005: 103,714, 2004: 85,766) that are available, with certain restrictions in time, for offset against future taxable profits of the companies in which the losses arose. We assessed the likelihood that our carry forward losses will be recovered from future taxable profit, and to the extent we believe that recovery is probable we recognized a deferred tax asset, which is 308 as at December 31, 2006. To the extent the likelihood of a recovery of deferred tax assets changes, we include an expense or a gain within the tax charge in our Income Statement for the relevant period. Significant management judgment is required in the valuation of our deferred tax assets. We consider future taxable profit projections, historical results and ongoing tax planning strategies in assessing the recoverability of deferred tax assets. In the event that actual results differ from these estimates due to future changes in income tax law or results from final review of our tax returns by tax authorities, we may need to adjust the valuation of our deferred tax assets, which could materially impact our financial position and results of operations.