With independent auditor’s report

JSC “Uzbekneftegaz”
Consolidated financial statements
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
25
4. 
Critical estimates and judgements (continued)
Taxation (continued)
Deferred tax assets are recognized for all allowances and unused tax losses to the extent that it is probable
that taxable temporary differences and business nature of such expenses will be proved. Significant
management judgment is required to determine the amount of deferred tax assets that can be recognized,
based upon the likely timing and level of future taxable profits together with future tax planning strategies
(Note 29)
.
Value of net assets transferred and received from one organization to another, including during their
reorganization and liquidation, in accordance with Government Decrees commonly is not subject to taxation
for all types of taxes.
Fair value of financial instruments
Where the fair value of financial assets and financial liabilities recorded in the consolidated statement of
financial position cannot be derived from active markets, they are determined using valuation techniques
including the discounted cash flows model. The inputs to these models are taken from observable markets
where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. The
judgments include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in
assumptions about these factors could affect the reported fair value of financial instruments.
Useful lives of property, plant and equipment
The Group assesses the remaining useful lives of items of property, plant and equipment at least at each
financial year-end and, if expectations differ from previous estimates, the changes are accounted for
prospectively as a change in an accounting estimate in accordance with IAS 8
Accounting Policies, Changes
in Accounting Estimates and Errors
.