The components of the income tax
provision (recovery) include:
|
|
|
|
|
|
|
|
|
| |
|
2017 |
|
|
2016 |
|
|
Current
|
|
$ |
— |
|
|
$ |
— |
|
|
Deferred
|
|
|
298 |
|
|
|
(568 |
) |
|
|
|
|
|
|
|
|
|
|
|
$ |
298 |
|
|
$ |
(568 |
) |
|
|
|
|
|
|
|
|
|
The reconciliation of the combined
Canadian federal and provincial statutory income tax rate of 26.5%
(2016 - 26.5%) to the effective tax rate is as follows:
|
|
|
|
|
|
|
|
|
| |
|
2017 |
|
|
2016 |
|
|
Income before income taxes
|
|
$ |
2,789 |
|
|
$ |
(1,758 |
) |
|
Combined statutory tax rate
|
|
|
26.5 |
% |
|
|
26.5 |
% |
|
Theoretical tax expense (recovery)
|
|
$ |
739 |
|
|
$ |
(466 |
) |
|
Non-deductible
expense:
|
|
|
|
|
|
|
|
|
|
Stock-based payments
|
|
|
494 |
|
|
|
81 |
|
|
Non-taxable income:
|
|
|
|
|
|
|
|
|
|
Non-taxable portion of
capital gains
|
|
|
(762 |
) |
|
|
— |
|
|
Effect of provincial tax rate difference
|
|
|
5 |
|
|
|
4 |
|
|
Changes in unrecognized deferred tax assets
|
|
|
(178 |
) |
|
|
(187 |
) |
|
|
|
|
|
|
|
|
|
|
Income tax expense (recovery)
|
|
$ |
298 |
|
|
$ |
(568 |
) |
|
|
|
|
|
|
|
|
|
The components of deferred tax are
summarized below. Deferred tax assets and liabilities have been
offset where they relate to income taxes levied by the same
taxation authority and the Company has the legal right and intent
to offset.
|
|
|
|
|
|
|
|
|
| |
|
2017 |
|
|
2016 |
|
|
Deferred tax assets
|
|
|
|
|
|
|
|
|
|
Non-capital losses carried
forward
|
|
$ |
5,690 |
|
|
$ |
2,400 |
|
|
Scientific research and experimental development
|
|
|
28 |
|
|
|
28 |
|
|
Financing fees
|
|
|
31 |
|
|
|
— |
|
|
|
|
|
Deferred tax liabilities
|
|
|
|
|
|
|
|
|
|
Biological assets
|
|
|
(986 |
) |
|
|
(18 |
) |
|
Inventory
|
|
|
(1,989 |
) |
|
|
(51 |
) |
|
Equity accounted investments
|
|
|
(153 |
) |
|
|
— |
|
|
Investments
|
|
|
(91 |
) |
|
|
(696 |
) |
|
Property, plant and equipment
|
|
|
(968 |
) |
|
|
(158 |
) |
|
Health Canada licenses
|
|
|
(2,978 |
) |
|
|
(2,962 |
) |
|
|
|
|
|
|
|
|
|
|
Net deferred tax liability
|
|
$ |
(1,416 |
) |
|
$ |
(1,457 |
) |
|
|
|
|
|
|
|
|
|
The movement in the net deferred tax
liability is provided below:
|
|
|
|
|
|
|
|
|
| |
|
2017 |
|
|
2016 |
|
|
Balance - beginning of year
|
|
$ |
1,457 |
|
|
$ |
195 |
|
|
Recognized in income
|
|
|
298 |
|
|
|
(568 |
) |
|
Recognized in other comprehensive income
|
|
|
(339 |
) |
|
|
430 |
|
|
Recognized in goodwill
|
|
|
— |
|
|
|
1,400 |
|
|
|
|
|
|
|
|
|
|
|
Balance - end of year
|
|
$ |
1,416 |
|
|
$ |
1,457 |
|
|
|
|
|
|
|
|
|
|
Deferred taxes are provided as a
result of temporary differences that arise due to the differences
between the income tax values and the carrying amount of assets and
liabilities. Deferred tax assets have not been recognized in
respect of the following deductible temporary differences because
it is not probable that future taxable profit will be available
against which the Company can utilize the benefits
therefrom.
The following are temporary
differences that gave rise to deferred tax assets, which have not
been recognized in these consolidated financial
statements.
|
|
|
|
|
|
|
|
|
| |
|
2017 |
|
|
2016 |
|
|
Property, plant and equipment
|
|
$ |
684 |
|
|
$ |
— |
|
|
Equity accounted investments
|
|
|
— |
|
|
|
89 |
|
|
Share and debt issuance costs (i)
|
|
|
2,834 |
|
|
|
1,085 |
|
|
Losses carried forward (ii)
|
|
|
7,814 |
|
|
|
3,833 |
|
|
Other investments
|
|
|
— |
|
|
|
6 |
|
| (i) |
Share and debt issuance costs will be fully
amortized in 2022. The remaining deductible temporary differences
may be carried forward indefinitely.
|
| (ii) |
For income tax purposes, the Company has losses
carried forward from prior years which can be used to reduce future
years’ taxable income. These losses expire as follows:
|
|
|
|
|
|
| |
|
Non-capital
losses |
|
|
2030
|
|
$ |
32 |
|
|
2031
|
|
|
22 |
|
|
2032
|
|
|
877 |
|
|
2033
|
|
|
3,177 |
|
|
2034
|
|
|
1,782 |
|
|
2035
|
|
|
5,452 |
|
|
2036
|
|
|
6,558 |
|
|
2037
|
|
|
11,383 |
|
|
|
|
|
|
|
|
$ |
29,283 |
|
|
|
|
|
|
|