Globant S.A. | CIK:0001557860 | 3

  • Filed: 4/13/2018
  • Entity registrant name: Globant S.A. (CIK: 0001557860)
  • Generator: Workiva (WebFilings)
  • SEC filing page: http://www.sec.gov/Archives/edgar/data/1557860/000114420418020505/0001144204-18-020505-index.htm
  • XBRL Instance: http://www.sec.gov/Archives/edgar/data/1557860/000114420418020505/glob-20171231.xml
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    • ifrs-full:DisclosureOfIncomeTaxExplanatory

    INCOME TAXES

    7.1 – INCOME TAX RECOGNIZED IN PROFIT AND LOSS
     
     
     
    For the year ended December 31,
     
     
    2017
     
    2016
     
    2015
    Tax expense:
     
     

     
     

     
     

         Current tax expense
     
    (14,053
    )
     
    (15,057
    )
     
    (19,522
    )
         Deferred tax benefit (1)
     
    5,972

     
    730

     
    1,102

    TOTAL INCOME TAX EXPENSE
     
    (8,081
    )
     
    (14,327
    )
     
    (18,420
    )


    (1)
    As of December 31, 2017, includes 1,004 of deferred tax gain related to changes in tax rates.
     
    Substantially all revenues are generated in the U.S. and United Kingdom through subsidiaries located in those countries. The Company´s workforce is mainly located in Latin America and to a lesser extent in India and U.S.


    The following table provides a reconciliation of the statutory tax rate to the effective tax rate. As the operations of the Argentine subsidiaries are the most significant source of net taxable income of the Company, the following reconciliation has been prepared using the Argentine tax rate: 
     
     
    For the year ended December 31,
     
     
    2017
     
    2016
     
    2015
    Profit before income tax
     
    38,544

     
    50,189

     
    50,040

    Tax rate (note 3.7.1.1)
     
    35
    %
     
    35
    %
     
    35
    %
    Income tax expense
     
    (13,490
    )
     
    (17,566
    )
     
    (17,514
    )
     
     
     
     
     
     
     
    Permanent differences
     
     

     
     

     
     

    Argentine Software Promotion Regime (note 3.7.1.1)
     
    3,541

     
    7,189

     
    15,037

    Effect of different tax rates of subsidiaries operating in countries other than Argentina
     
    2,019

     
    1,069

     
    1,362

    Non-deductible expenses
     
    1,187

     
    2,301

     
    1,184

    Tax loss carry forward not recognized
     
    (374
    )
     
    (878
    )
     
    (1,681
    )
    Exchange difference
     
    (860
    )
     
    (6,593
    )
     
    (17,560
    )
    Other
     
    (104
    )
     
    151

     
    752

    INCOME TAX EXPENSE RECOGNIZED IN PROFIT AND LOSS
     
    (8,081
    )
     
    (14,327
    )
     
    (18,420
    )
     
    7.2 – DEFERRED TAX ASSETS
     
     
     
    As of December 31,
     
     
    2017
     
    2016
    Share-based compensation plan
     
    5,772

     
    4,919

    Provision for vacation and bonus
     
    1,309

     
    1,339

    Intercompany trade payables
     
    3,126

     
    —

    Property and equipment
     
    756

     
    (298
    )
    Contingencies
     
    —

     
    31

    Others
     
    (182
    )
     
    (39
    )
    Loss carryforward (1)
     
    2,405

     
    1,739

    TOTAL DEFERRED TAX ASSETS
     
    13,186

     
    7,691

     
    (1)
    As of December 31, 2017 and 2016, the detail of the loss carryforward is as follows:
     
     
    2017
     
    2016
    Company
     
    Loss carryforward
     
    Expiration date
     
    Loss carryforward
     
    Expiration date
    Globant S.A.
     
    737

     
    2035
     
    —

     
    —
    Dynaflows S.A.
     
    80

     
    2020
     
    17

     
    2020
    Globant Brasil Consultoría Ltda. (2)
     
    1,219

     
    does not expire
     
    1,235

     
    does not expire
    We Are London Limited
     
    253

     
    does not expire
     
    —

     
    —
    Sistemas UK Limited
     
    116

     
    does not expire
     
    105

     
    does not expire
    Sistemas Globales Chile Ases. Ltda.
     
    —

     
    —
     
    101

     
    does not expire
    Globant LLC
     
    —

     
    —
     
    274

     
    does not expire
    Software Product Creation S.L.
     
    —

     
    —
     
    7

     
    does not expire
     
     
    2,405

     
     
     
    1,739

     
     

    (2)
    The amount of the carryforward that can be utilized for Globant Brasil Consultoría Ltda. is limited to 30% of taxable income in each carryforward year.


    The roll forward of the deferred tax assets/(liabilities) presented in the consolidated financial position is as follows:

     
     
     
     
     
     
     
     
     
     
     
     
     
     
    Opening
     
    Recognised in
     
    Recognised
     
    Acquisitions/
     
    Closing
     
     
    balance
     
    profit or loss
     
    directly in equity
     
    disposals
     
    balance
    Deferred tax assets/(liabilities) in relation to:
     
     
     
     
     
     
     
     
     
     
    Share-based compensation plan
     
    4,919

     
    1,026

     
    1,400

     
    (1,573
    )
     
    5,772

    Provision for vacation and bonus
     
    1,339

     
    (30
    )
     
    —

     
    —

     
    1,309

    Intercompany trade payables
     
    —

     
    3,126

     
    —

     
    —

     
    3,126

    Property and equipment
     
    (298
    )
     
    1,054

     
    —

     
    —

     
    756

    Contingencies
     
    31

     
    (31
    )
     
    —

     
    —

     
    —

    Others
     
    (39
    )
     
    (143
    )
     
    —

     
    —

     
    (182
    )
    Subtotal
     
    5,952

     
    5,002

     
    1,400

     
    (1,573
    )
     
    10,781

    Loss carryforward
     
    1,739

     
    970

     
    —

     
    (304
    )
     
    2,405

    TOTAL
     
    7,691

     
    5,972

     
    1,400

     
    (1,877
    )
     
    13,186