centro to distribute dividends, page-8

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The easist way to think about income tax is that the treatment generally follows cash paid out, or liable to be paid. That is, Centro would get tax deductions for cash working expenses paid, or liable (presently existing legal obligation)to be paid.

This means Centro does not get a tax deduction for asset impairement expenses (asset write downs) or provisions (such as a provision for legal costs to defend the class actions). Hence, Centro might have expenses that are recorded for accounting expenses, but are not yet deductible for income tax purposes - timing differences.

Of course, the accounting expenses and a shortage of available free cash flow will reduce Centro's ability to pay dividends. This is the problem.