Vetoquinol Universal Registration Document 2019

78   Vetoquinol  Universal Registration Document 2019  Financial report 6 CONSOLIDATED FINANCIAL STATEMENTS Notes to the consolidated financial statements 6.5.16 Net financial income/(expense) €000 2019 2018 Interest income from cash and cash equivalents 280 439 Net gains on sale of cash equivalents - - INCOME FROM CASH AND CASH EQUIVALENTS 280 439 Interest on bonds - - Interest on borrowings and overdrafts (217) (190) Interest on other borrowings - IFRS 16 (165) - Interest on finance leases - - GROSS COST OF DEBT (382) (190) NET (COST OF DEBT)/INCOME FROM CASH AND CASH EQUIVALENTS (102) 249 €000 2019 2018 Currency gains 2,275 2,310 Other income 174 94 Other financial income 2,448 2,403 Financial expenses related to employee benefits (81) (64) Currency losses (1,869) (2,063) Other expenses (601) (164) OTHER FINANCIAL EXPENSES (2,551) (2,291) OTHER FINANCIAL INCOME AND EXPENSES (103) 112 6.5.17 Income tax Deferred taxes are recognized on temporary differences between the tax values of assets and liabilities and their book values in the consolidated financial statements. No deferred tax is accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that affects neither accounting profit nor taxable income at the transaction date. No deferred tax liability is recognized on initial recognition of goodwill. Deferred tax is determined using tax rates (and tax regulations) that have been adopted or substantially adopted as of the balance sheet date, and that are expected to apply when the related deferred tax asset is realized or the deferred tax liability settled. Deferred tax assets are recognized only to the extent that it is probable that future taxable income, against which the temporary differences can be applied, will be earned. The 2019 tax rate used to calculate deferred taxes for French companies was 32.02% (2018: 34.43%). When the temporary difference is expected to be reversed after 2019, the related deferred taxes are calculated at the rate of 28.92% and not 32.02%. The difference from the final income tax rate of 25% is non-material. Income tax expense is broken down as follows: €000 2019 2018 Current income tax expense (11,634) (12,469) Deferred tax income/(expense) (830) 298 TOTAL (12,464) (12,171)