Amendment #4 Page 433 of 868 fbt„pnh• heome taxes Cur none tax balances are determned and reported in accordance with FASBASC 740 CASC 7401 Income Taxes. Our moon* tax balances are determined and reported using a 'separate return- method. Under tie separate return mettcd. income tax amoures tune teen cemented as if the Companies fled separate tax returns Deferred tax assets and liablibes are recognized for the Uwe lax consequences attributable to differences between the hence' statement carrying amotnts of exisbrg assets and waves and their respecbve tax bean and operabng loss carry forwards and tax aedd carry fonvards. Deferred income taxes ante prime* because of differences in the bases of assets or hatillies between financel statement accounting and lax eccountng which are known as temporary deafen:et We record the tax effect of these temporary dfferences as deferred tax assets (genera Ey tans that cal be used as a tax deduction or credit in future penods) and deferred tax retain (generally items for which we receive a tax deduction but have not yet teen recorded in the combined statement of income) Deferred tax assets and Ilab ibex ore measured urerg enacted tax rates expected toappty to taxable income in the years n when those temporary clearances are expected to be recovered or settled. We ignore future ongrating temporary differences and schedule existing temporary differences to reverse on a first-n-first-out basis when deforming the tax rate expected to apply for purposes of meastnng deferred taxes. The effect on deferred tax assets and habit:es ot a charge n tax rate is recognized in operations in the period that includes the enactment date We regularly review in deterred tax assets for reanability, talona ire° consideration al wallet* evidence, bath posture and negawe, inducing historical pre-ter and taxable income, projected future pee-tax and taxable scone and the expected timing of the reverses of existing temporary dieerences in err Win