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SABMiller plc - Restatement of Financial Information under International
Financial Reporting Standards
SABMiller plc
JSE Alpha Code : SAB
Issuer Code SOSAB
ISIN Code GB0004835483
Restatement of Financial Information under International Financial Reporting
Standards
SABMiller plc currently prepares its financial statements under United Kingdom
Generally Accepted Accounting Principles (UK GAAP). As part of its preparation
for the adoption of International Financial Reporting Standards (IFRS),
SABMiller plc is today making available financial information for the year ended
31 March 2005 in accordance with IFRS.
The adoption of IFRS represents an accounting change only, and does not affect
the underlying operations or cash flows of the group. The IFRS financial
information in this document is unaudited.
Summary of main changes
UK GAAP IFRS 2005 % change
2005 Unaudited
Audited US$m
US$m
Group revenue 12,901 12,901 -
EBITA (becoming EBIT under 2,409 2,389 (0.8)
IFRS)*
Profit before tax 2,194 2,552 16.3
Adjusted earnings** 1,251 1,224 (2.1)
Basic earnings per share 94.1 125.5 33.3
Adjusted earnings per share 103.2 101.0 (2.1)
(US cents)
Adjusted diluted earnings 99.8 97.7 (2.1)
per share (US cents)
*EBITA comprises profit before interest, tax, goodwill amortisation and before
one-off items. EBIT comprises profit before interest, tax and one-off items.
**The calculation of adjusted earnings is given in table 1.
The most significant changes from UK GAAP to IFRS are:
The reversal of amortisation of goodwill which increases profit before tax by
US$366 million but has no impact on EBITA or adjusted earnings.
A pre-tax increase in post-retirement costs of US$4 million impacting all
measures shown above, and an additional one-off credit of US$104 million
relating to certain changes in the group`s post-retirement arrangements which
does not affect EBITA or adjusted earnings.
The inclusion of a charge, based on fair value, in respect of outstanding share-
based awards granted after 7 November 2002. This increases net operating costs
by US$6 million.
IFRS RESTATEMENT
2
Background to the change
SABMiller plc has previously prepared its financial statements under UK GAAP.
For the purposes of this announcement all references to UK GAAP relate to the
accounting policies adopted by SABMiller plc as set out in the SABMiller plc
annual report for the year ended 31 March 2005. From 1 April 2005 onwards, the
group is required to prepare its consolidated financial statements in accordance
with IFRS as endorsed by the European Union (EU) and implemented in the UK.
This change applies to all of the group`s financial reporting for accounting
periods beginning on 1 April 2005. The group`s date of transition to IFRS under
IFRS1 (First-time adoption of IFRS) was 1 April 2004. The group`s first
published IFRS results will be for the six months to 30 September 2005 and the
first full year IFRS results will be for the year ending 31 March 2006. The 2006
financial statements will include comparatives for 2005 which will be restated
to IFRS, other than with respect to IAS 32 (Financial Instruments: Disclosure
and Presentation) and IAS 39 (Financial Instruments: Recognition and
Measurement).
To explain how the group`s reported performance and financial position are
affected by this change, set out in tables 1 to 7 is a comparison of key UK GAAP
figures for the interim and full 2005 financial year to unaudited restated IFRS
results.
Basis of preparation of IFRS information
The key figures set out in tables 1 to 7 are based on the IFRS expected to be
applicable at 31 March 2006, and the interpretation of those standards. IFRS are
subject to possible amendment by and interpretative guidance from the
International Accounting Standards Board, as well as ongoing review and
endorsement by the EU, and are thus subject to change. The IFRS figures in
tables 1 to 7 may therefore be subject to changes in the basis of accounting
and/or presentation of certain financial information before their inclusion in
the IFRS financial statements for the year ending 31 March 2006 when the group
prepares its first complete set of IFRS financial statements.
IFRS 1 Exemptions
IFRS1 (First-time adoption of IFRS) permits certain exemptions from the full
requirements of IFRS to companies adopting IFRS for the first time. The group
expects to apply the following transitional provisions:
Business combinations (including acquisitions) recognised before the date of
transition (1 April 2004) have not been restated.
Fixed assets held at historical cost have not been revalued; therefore
depreciation and impairment tests will continue to be based on historical cost.
IAS 32 and IAS 39 are applied prospectively from 1 April 2005, therefore hedge
documentation and effectiveness is only measured from that date.
Cumulative currency translation differences on foreign net investments
recognised separately in equity have been reset to US$Nil at the date of
transition.
The cost of share options granted prior to 7 November 2002 has not been
recognised in the income statement.
The accumulated actuarial gains and losses with regards to employee defined
benefit post-retirement plans have been recognised in full in the opening IFRS
balance sheet as at 1 April 2004.
Convertible bonds have not been split into component values if the bond has been
repaid by the transition date for financial instruments, which was 1 April 2005.
IFRS RESTATEMENT
3
Significant Changes
The most significant areas of change are as follows;
(Tables 1 to 7 are cross referenced to the notes below where relevant.)
Goodwill
Under UK GAAP, goodwill is amortised over its estimated useful life (the group
typically applies a 20 year life to goodwill, with the exception of goodwill in
Amalgamated Beverage Industries (ABI) which has an indefinite life and has been
subjected to annual impairment reviews).
Under IFRS, the amortisation of goodwill is no longer permitted and goodwill is
reviewed for impairment on an annual basis. As a result the amortisation charge
of US$366 million recorded in 2005 is reversed. As a consequence of this
change, the profit attributable to minority interests also increases by US$22
million.
Post-retirement benefits
Under UK GAAP, the group accounts for post-retirement benefits under SSAP24
(Accounting for Pension Costs), whereby the costs of providing pensions and
other post-employment benefits are charged against operating profit on a
systematic basis with surpluses and deficits arising allocated over the expected
average remaining service lives of current employees. The group disclosed the
impact of accounting for pensions under FRS 17 (Retirement Benefits) by way of
footnote, as required by the FRS 17 transitional arrangements.
Under IFRS, the impact on the income statement is that the unwinding of the
discounting on liabilities and the expected return on assets are included in
operating profit. The impact on the balance sheet is that the full actuarial
surplus or deficit is recognised. The more volatile components of movements in
surpluses and deficits (actuarial gains and losses) are recorded as a movement
in shareholders` funds in line with the amendments to IAS 19 (Employee Benefits)
although this is subject to endorsement by the EU.
The new IFRS rules primarily affect Miller in North America and Beer South
Africa. The ongoing income statement effect of this change is an additional cost
of US$4 million in 2005.
The costs in North America have risen by US$7 million, offset by a credit in
Beer South Africa of US$3 million (the latter of which is not expected to recur
in 2006).
The pre-tax IFRS adjustments to post-retirement benefits are summarised below:
US$m
North America
Pensions (5)
Other post-retirement costs (2)
(7)
Beer South Africa
Pensions (4)
Other post-retirement costs 7
3
Total (4)
IFRS RESTATEMENT
4
During 2005 Miller also revised its post-retirement arrangements. The effect of
the changes in plans and the capping of post-retirement medical healthcare
liabilities results in a credit to the 2005 IFRS income statement of some US$104
million (US$63 million net of tax). This represents the savings associated with
past service. This has been treated as a one-off item.
The impact of all post-retirement benefit adjustments on the IFRS opening
balance sheet as at 1 April 2004 is to reduce net assets by US$80 million net of
deferred tax. The reduction at 31 March 2005 is US$147 million net of deferred
tax.
Share-based payments
Under UK GAAP, only certain share-based plans (where the grant price is less
than the market price at the date of grant) result in a charge to operating
profit over the performance period on a straight line basis.
Under IFRS, all share-based awards granted after 7 November 2002 result in a
charge to operating profit over the performance period on a straight line basis.
The additional cost to the group in 2005 includes extra costs for certain share-
based plans and results in the recognition of an additional pre-tax charge for
2005 of US$6 million.
As more option tranches are covered by the new rules the costs in relation to
share-based payments will rise under IFRS. It is anticipated that the ongoing
annual cost compared to UK GAAP will be some US$10 -14 million in 2006.
Presentation of associates
Under UK GAAP, operating profit, net interest, taxation and minority interests
include the group`s share of associates` results.
Under IFRS, the income statement only includes the group`s share of the post-tax
and minority results of associates as one line before the group`s pre-tax
profit.
In order to aid comparison of results across segments, the group intends to
present an operating profit/EBIT measure in the segmental analysis which will
include associates in the same format as subsidiaries.
IFRS application to associates
As a result of the non-amortisation of goodwill, profits from associates
increase by US$15 million for 2005. Other net charges of US$9 million for 2005
principally arise in respect of share-based payments, inventories, intangibles
and property, plant and equipment.
The application of IFRS, including the non-amortisation of goodwill, increases
the group`s carrying value of associates as at 31 March 2005 by US$9 million.
Certain of the group`s associates continue to work on the restatement of IFRS in
their own results. Any further changes arising will be reflected in the group
IFRS position as at 30 September 2005 in the interim results for the year ending
31 March 2006.
IFRS RESTATEMENT
5
Agricultural assets
Under UK GAAP, agricultural assets are not separately recorded.
Under IFRS, agricultural assets are recognised on the balance sheet at fair
value with gains/losses recorded in the income statement. The additional US$2
million cost for 2005 relates to sugar plantations in Honduras and hop farms in
South Africa.
Taxation
Under UK GAAP, the group recognises deferred tax on timing differences that
arise from the inclusion of gains and losses in tax assessments in periods
different from those in which they are recognised in the financial statements
(an income statement approach).
Under IFRS, deferred tax is recognised in respect of nearly all taxable
temporary differences arising between the tax base and the accounting book value
of balance sheet items (a balance sheet approach). This results in deferred tax
being recognised on certain timing differences that would not have given rise to
deferred tax under UK GAAP. Excluding the net impact of deferred tax on post-
retirement schemes, the IFRS impact on other deferred tax assets and liabilities
is a reduction in net assets of US$108 million in the opening IFRS balance sheet
and US$119 million as at 31 March 2005.
Upon the adoption of IFRS, deferred tax is recognised on unremitted earnings of
subsidiaries and associates, unless the group is able to demonstrate that the
dividend policy cannot be changed without its consent and it is unlikely that
those earnings will be paid as dividends in the foreseeable future.
The group has recognised an additional US$7 million deferred tax charge in the
2005 income statement primarily with respect to unremitted earnings of
associates.
Exceptional items
Under UK GAAP, gains and loses on the disposal of subsidiaries, associates,
fixed asset investments and tangible fixed assets are shown as exceptional items
below operating profit (non-operating exceptionals).
IFRS does not contain the same specific rules related to the presentation of
exceptional items, but does require disclosure of additional items where
necessary to assist in the understanding of an entity`s financial performance. A
reclassification of US$366 million exceptional profit under UK GAAP previously
recognised below operating profit has been made to move the UK GAAP non-
operating exceptional items back into operating profit. The group will continue
to separately identify significant and one-off items previously treated as
exceptional under UK GAAP. These will all be recognised within operating profit.
In addition, the group will continue to present the adjusted earnings per share
and operating profit before exceptional items measures.
Dividends
Under UK GAAP, dividends for the period are provided for in the results for that
period.
Under IFRS, the dividends for the period are provided in the results in the
period during which they are approved.
IFRS RESTATEMENT
6
Balance Sheet reclassifications
Capitalised software
Under UK GAAP, software assets are included as part of property, plant and
equipment.
Under IFRS, unless they are integral to another tangible fixed asset, software
assets are recognised as intangible assets.
Debtors
Under UK GAAP, debtors are generally shown as a one line entry in current assets
unless they are deemed to be highly significant for separate disclosure on the
face of the balance sheet.
Under IFRS, debtors due within one year are recognised as current assets and
debtors due after more than one year are recognised as non-current assets on the
face of the balance sheet.
Deferred tax assets and liabilities
Under UK GAAP, deferred tax assets and liabilities are shown as part of current
debtors and provisions on the face of the balance sheet.
Under IFRS, deferred tax assets and liabilities are presented separately on the
face of the balance sheet under IFRS.
Provisions
Under UK GAAP, provisions are presented as a one line entry on the balance
sheet.
Under IFRS, provisions likely to fall due within one year are recognised as
current liabilities and provisions likely to fall due after more than one year
are recognised as long-term liabilities on the face of the balance sheet.
Other IFRS Adjustments
Other IFRS adjustments result in an increase in net assets of US$16 million at
31 March 2005 and include the following items:
Buyout of minority shares in Birra Peroni and ABI
Upon the adoption of IFRS goodwill is recognised on the buy out of minority
interests in subsidiaries as the difference between the value of IFRS net assets
acquired and the consideration paid.
The buyout of minority interests in Birra Peroni SpA and ABI increased goodwill
due to changes within deferred tax. As a consequence, this reduced equity
attributable to minority interests by US$11 million and US$1 million
respectively.
IFRS RESTATEMENT
7
Foreign currency translations
Under UK GAAP if a derivative instrument has been entered into which is linked
to the settlement of a foreign currency asset or liability the exchange rate of
the derivative can be used to translate the foreign currency amount.
Under IFRS the closing rate exchange rate must be used with the derivative
effect recognised separately.
The group has a sterling denominated private note of GBP40 million covered by
such an arrangement - the value of the loan at 31 March 2005 rises by US$14
million and an equivalent US$14 million asset is recognised in debtors (1 April
2004 adjustment US$14 million). The full adoption of IAS32 and 39 as at 1 April
2005 will not change this position materially.
In addition, exchange differences arising on the translation of IFRS adjustments
to net assets, together with differences between IFRS income statement
adjustments translated at average and closing rates, are shown as a movement in
shareholders` funds.
Prepaid interest
Under UK GAAP, prepaid interest is included as part of prepayments in debtors on
the face of the balance sheet.
Under IFRS, prepaid interest is recognised as part of the debt balance to which
it is related. Therefore, prepaid interest is reallocated to current and non-
current liabilities in the same manner.
Spare parts
Spare parts previously held in inventory under UK GAAP have been reallocated to
tangible fixed assets under IFRS where the part is deemed to be a major spare
part that will be in use for more than one year when installed.
Other Matters
Excise
Unlike value added tax, excise is not directly related to the value of sales. It
is not generally recognised as a separate item on invoices, increases in excise
are not always directly passed on to customers, and the group cannot reclaim the
excise where customers do not pay for product received. Under UK GAAP, the group
therefore considered excise as a cost to the group and reflected it as a
production cost and consequently any excise that is recovered in the sale price
is included in revenue. The group believes the current UK GAAP treatment of
excise within revenue continues to be appropriate under IFRS. Therefore, no IFRS
adjustment has been made to revenue. The matter will be kept under review.
IFRS RESTATEMENT
8
Segmental analysis
Under IFRS, the group will continue to report on a regional segmental basis
(refer to table 2). Following the acquisition in December 2004 of the remaining
shares in ABI, a programme of work has begun to establish and leverage the
benefits from the combination of our beverage businesses in South Africa.
Results for South Africa Beverages are now shown as one segment.
In addition to statutory requirements under IFRS, the group will present an
operating profit/EBIT measure on a segmental basis which will include associates
in the same format as subsidiaries, before interest, tax and minority interests,
to allow for consistent comparison of results across segments.
Under IFRS, share-based payments are allocated on a segmental basis. This was
not the case under UK GAAP.
Earnings per share (EPS)
Under both UK GAAP and IFRS, basic earnings per share is derived from the
earnings attributable to ordinary shareholders divided by the average number of
ordinary shares in issue during the period (excluding shares held by employee
share trusts and by Safari Ltd).
Under both UK GAAP and IFRS, adjusted earnings per share uses the same number of
shares with profit adjusted to exclude the impact of amortisation, capital items
and other one-off items.
Cash and cash equivalents
Under UK GAAP, the cash flow statement presents changes in cash.
Under IFRS, the cash flow statement presents changes in cash and cash
equivalents (certain short-term highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value).
Although the format of the cash flow statement will change under IFRS, and net
debt will change to reflect prepaid interest, cash flows are unaffected. A full
reconciliation of net debt will continue to be provided.
Financial instruments
IAS32 and IAS39 on financial instruments will be applied prospectively from 1
April 2005. Consequently the restated figures for the 2005 financial year (1
April 2004 - 31 March 2005) do not reflect the impact of these standards.
These are complex standards and are continuing to change. On the current
understanding of IAS32 and IAS39, it is expected that the main implication of
applying these standards in the 2006 financial year will be as follows:
The group uses derivative financial instruments to hedge its exposure to foreign
exchange and interest rate risks arising from operational, financing and
investment activities. The group does not hold derivatives for trading purposes
but under IFRS, if the tests for hedge accounting are not met, the derivatives
are treated as if held for trading purposes. For many derivatives used by the
group it is possible to obtain hedge accounting or the implications of not doing
so are not considered material.
IFRS RESTATEMENT
9
Under UK GAAP, the book value of derivative financial instruments (cross
currency swaps and forward foreign exchange contracts) in respect of borrowings
and short-term deposits was included in their carrying value on the balance
sheet.
Under IFRS, the fair value of these derivatives is shown separately on the
balance sheet.
Available for sale investments will be marked to market with changes in value
taken to equity and recycled to income when the investment is sold. This is not
expected to have a material impact on the group.
Although the 31 March 2005 balance sheet will not be restated to show the effect
of adopting IAS 32 and IAS 39, the balance sheet as at 1 April 2005 will be
restated to show the effect of retrospective application of these standards.
This will be provided in the publication of the first half result for 2006.
IFRS RESTATEMENT
10
The effect of the change to IFRS on the income statement for the year ended 31
March 2005 is as follows:
Reported (UK Goodwill Post-retirement
GAAP) (a) benefits
audited US$m
US$m
(b) 1 (b) 2
US$m US$m
Revenue (including 14,543 - - -
share of associates`
revenue)
Less: share of (1,642) - - -
associates` revenue
Group revenue 12,901 - - -
Net operating costs (11,152) 351 (4) 104
Group operating profit 1,749 351 (4) 104
Share of profit of 246 15 - -
associates post
interest, tax and
minority interests
Exceptional items 366 - - -
Profit on ordinary 2,361 366 (4) 104
activities before
interest and taxation
Net interest payable (167) - - -
Profit on ordinary 2,194 366 (4) 104
activities before
taxation
Taxation on profit on (850) - 1 (41)
ordinary activities
Profit on ordinary 1,344 366 (3) 63
activities after
taxation
Attributable to (203) (22) - -
minority interests
Attributable to the 1,141 344 (3) 63
group
Reconciliation to
adjusted earnings
Profit for the 1,141 344 (3) 63
financial year
Amortisation of 366 (366) - -
goodwill
Impairment costs 9 - - -
Net profit on disposal (343) - - -
of assets
Brewery closure costs 20 - - -
Associates` share of (11) - - -
profit on disposal of
assets
IFRS adjustments - - - (104)
Tax effects on the 30 - - 41
above items
Minority interests` (31) 22 - -
share of the above
items
Headline earnings 1,181 - (3) -
Integration/ 32 - - -
reorganisation costs
South African STC on 38 - - -
non-recurring dividend
Adjusted earnings 1,251 - (3) -
Share-based Associates Agricultural
payments assets
(c) (f)
US$m US$m
(d) (e)
US$m US$m
Revenue (including - - - -
share of associates`
revenue)
Less: share of - - - -
associates` revenue
Group revenue - - - -
Net operating costs (6) - - (2)
Group operating profit (6) - - (2)
Share of profit of - (115) (9) -
associates post
interest, tax and
minority interests
Exceptional items - - - -
Profit on ordinary (6) (115) (9) (2)
activities before
interest and taxation
Net interest payable - 24 - -
Profit on ordinary (6) (91) (9) (2)
activities before
taxation
Taxation on profit on - 74 - -
ordinary activities
Profit on ordinary (6) (17) (9) (2)
activities after
taxation
Attributable to - 17 - -
minority interests
Attributable to the (6) - (9) (2)
group
Reconciliation to
adjusted earnings
Profit for the (6) - (9) (2)
financial year
Amortisation of - - - -
goodwill
Impairment costs - - - -
Net profit on disposal - - - -
of assets
Brewery closure costs - - - -
Associates` share of - - - -
profit on disposal of
assets
IFRS adjustments - - - -
Tax effects on the - - - -
above items
Minority interests` - - - -
share of the above
items
Headline earnings (6) - (9) (2)
Integration/ - - - -
reorganisation costs
South African STC on - - - -
non-recurring dividend
Adjusted earnings (6) - (9) (2)
Deferred Reclassifications Restated
taxation (h) (IFRS)
(g) US$m unaudited
US$m US$m
Revenue (including - - 14,543
share of associates`
revenue)
Less: share of - - (1,642)
associates` revenue
Group revenue - - 12,901
Net operating costs - 355 (10,354)
Group operating - 355 2,547
profit
Share of profit of - 11 148
associates post
interest, tax and
minority interests
Exceptional items - (366) -
Profit on ordinary - - 2,695
activities before
interest and taxation
Net interest payable - - (143)
Profit on ordinary - - 2,552
activities before
taxation
Taxation on profit on (7) - (823)
ordinary activities
Profit on ordinary (7) - 1,729
activities after
taxation
Attributable to - - (208)
minority interests
Attributable to the (7) - 1,521
group
Reconciliation to
adjusted earnings
Profit for the (7) - 1,521
financial year
Amortisation of - - -
goodwill
Impairment costs - - 9
Net profit on - - (343)
disposal of assets
Brewery closure costs - - 20
Associates` share of - - (11)
profit on disposal of
assets
IFRS adjustments - - (104)
Tax effects on the - - 71
above items
Minority interests` - - (9)
share of the above
items
Headline earnings (7) - 1,154
Integration/ - - 32
reorganisation costs
South African STC on - - 38
non-recurring
dividend
Adjusted earnings (7) - 1,224
The presentation of the IFRS information on this page and those that follow is
not fully in accordance with IAS 1 (Presentation of Financial Statements) and
has been presented to give an indication of changes in results under IFRS from
previous UK GAAP equivalents and not an exact representation of how restated
IFRS results will be presented in the future.
IFRS RESTATEMENT
11
The effect of the change to IFRS on the income statement for the year ended 31
March 2005 is as follows:
Segmental Analysis
EBIT Amortisation EBITA
reported US$m reported (UK
(UK GAAP) GAAP)
audited US$m
US$m
North America 261 236 497
Central America 48 43 91
Europe 419 64 483
Africa and Asia 363 21 384
Associates` share* (121) (13) (134)
242 8 250
South Africa 958 - 958
Beverages
Associates` share* (50) - (50)
Beer South Africa 708 - 708
Other Beverage 250 - 250
Interests
Associates` share* (50) - (50)
908 - 908
Hotels and Gaming 79 2 81
Associates` share* (79) (2) (81)
- - -
Corporate (85) - (85)
Group - excluding 2,043 366 2,409
exceptional items
Associates` share* (250) (15) (265)
1,793 351 2,144
One-off items (48) 366# 318
Group - including 1,995 732 2,727
exceptional items
Associates` share* (246) (26) (272)
1,749 706 2,455
Post-retirement Share-based
benefits payments
(c)
US$m
(b) 1 (b) 2
US$m US$m
North America (7) - (3)
Central America - - -
Europe - - (1)
Africa and Asia - - (1)
Associates` share* - - -
- - (1)
South Africa Beverages 3 - (4)
Associates` share* - - -
Beer South Africa 3 - (2)
Other Beverage - - (2)
Interests
Associates` share* - - -
3 - (4)
Hotels and Gaming - - -
Associates` share* - - -
- - -
Corporate - - 3
Group - excluding (4) - (6)
exceptional items
Associates` share* - - -
(4) - (6)
One-off items - 104 -
Group - including (4) 104 (6)
exceptional items
Associates` share* - - -
(4) 104 (6)
Associates Agricultural EBIT
(e) assets restated
US$m (f) (IFRS)
US$m unaudited
US$m
North America - - 487
Central America - (1) 90
Europe - - 482
Africa and Asia - - 383
Associates` share* - - (134)
- - 249
South Africa - (1) 956
Beverages
Associates` share* - - (50)
Beer South Africa - (1) 708
Other Beverage - - 248
Interests
Associates` share* - - (50)
- (1) 906
Hotels and Gaming (8) - 73
Associates` share* 8 - (73)
- - -
Corporate - - (82)
Group - excluding (8) (2) 2,389
exceptional items
Associates` share* 8 - (257)
- (2) 2,132
One-off items - - 422
Group - including (8) (2) 2,811
exceptional items
Associates` share* 8 - (264)
- (2) 2,547
Statutory information presented from 30 September 2005 onwards will disclose the
group`s share of post-tax and minority results of associates on the face of the
income statement and in the analysis of group EBIT in the segmental disclosures.
*The results above include associates` profit before interest (US$24 million),
tax (US$75 million) and minority interests (US$17 million) which allows for
consistent comparison of results across the segments. When these items are
deducted from the group results of US$2,811 million above, the group profit
before interest and tax is US$2,695 million, as stated in the income statement.
#Reclassification of one-off items into operating profit.
IFRS RESTATEMENT
12
The effect of the change to IFRS on the balance sheet as at 1 April 2004
(opening IFRS balance sheet) is as follows:
Reported (UK Post- Associates
GAAP) retirement (e)
audited benefits US$m
US$m (b) 1
US$m
Fixed assets
Intangible assets 6,513 - -
Tangible assets 3,758 - -
Investments in 928 - 1
associates
Trade and other debtors - - -
Other investments 284 - -
Deferred tax asset - 79 -
11,483 79 1
Current assets
Inventories 599 - -
Trade and other debtors 1,035 4 -
Investments 31 - -
Cash and cash 651 - -
equivalents
2,316 4 -
Current liabilities
Creditors due within (2,783) 42 -
one year
Provisions - - -
(2,783) 42 -
Net current liabilities (467) 46 -
Non-current liabilities
Interest bearing (3,094) - -
creditors
Provisions (866) (205) -
Deferred tax - - -
liabilities
Other liabilities (72) - -
(4,032) (205) -
Net assets 6,984 (80) 1
Capital and reserves
Shareholders` funds 6,165 (80) 1
Equity minority 819 - -
interests
Total equity 6,984 (80) 1
Agricultural Deferred Dividends
assets taxation (i)
(f) (g) US$m
US$m US$m
Fixed assets
Intangible assets - - -
Tangible assets 5 - -
Investments in - - -
associates
Trade and other - - -
debtors
Other investments - - -
Deferred tax asset - (54) -
5 (54) -
Current assets
Inventories (2) - -
Trade and other - - -
debtors
Investments - - -
Cash and cash - - -
equivalents
(2) - -
Current liabilities
Creditors due within - - 289
one year
Provisions - - -
- - 289
Net current (2) - 289
liabilities
Non-current
liabilities
Interest bearing - - -
creditors
Provisions - - -
Deferred tax - (54) -
liabilities
Other liabilities - - -
- (54) -
Net assets 3 (108) 289
Capital and reserves
Shareholders` funds 2 (94) 269
Equity minority 1 (14) 20
interests
Total equity 3 (108) 289
Reclassifications Other Restated
(j) (k) (l) (m) (n) (o) (p) (q) (IFRS)
US$m US$m unaudited
US$m
Fixed assets
Intangible assets 94 - 6,607
Tangible assets (94) 3 3,672
Investments in - - 929
associates
Trade and other 70 - 70
debtors
Other investments - - 284
Deferred tax asset 107 - 132
177 3 11,694
Current assets
Inventories - (3) 594
Trade and other (177) (7) 855
debtors
Investments (31) - -
Cash and cash 31 - 682
equivalents
(177) (10) 2,131
Current liabilities
Creditors due - 10 (2,442)
within one year
Provisions (42) - (42)
(42) 10 (2,484)
Net current (219) - (353)
liabilities
Non-current
liabilities
Interest bearing - - (3,094)
creditors
Provisions 208 (3) (866)
Deferred tax (166) (1) (221)
liabilities
Other liabilities - - (72)
42 (4) (4,253)
Net assets - (1) 7,088
Capital and
reserves
Shareholders` funds - (1) 6,262
Equity minority - - 826
interests
Total equity - (1) 7,088
IFRS RESTATEMENT
13
The effect of the change to IFRS on the balance sheet as at 31 March 2005 is as
follows:
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