Transition to international financial reporting standards
Released: 04 Aug 2005
From 1 January 2005, Rathbone Brothers Plc is required by European Directives to report its consolidated financial statements under International Financial Reporting Standards (IFRS), as endorsed by the European Union (EU). This announcement explains how the changes in accounting treatment under IFRS impact on the Group’s previously reported financial information for the year ended 31 December 2004 prepared under UK Generally Accepted Accounting Principles (UK GAAP). All IFRS figures included in this announcement are unaudited. The date of transition to IFRS is 1 January 2004, being the start of the earliest period of comparative information.
Released: 04 Aug 2005
From 1 January 2005, Rathbone Brothers Plc is required by European Directives to report its consolidated financial statements under International Financial Reporting Standards (IFRS), as endorsed by the European Union (EU). This announcement explains how the changes in accounting treatment under IFRS impact on the Group’s previously reported financial information for the year ended 31 December 2004 prepared under UK Generally Accepted Accounting Principles (UK GAAP). All IFRS figures included in this announcement are unaudited. The date of transition to IFRS is 1 January 2004, being the start of the earliest period of comparative information.
A summary of the impact on the Group of the transition to IFRS for 2004 is provided in the table below:
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IFRS £’000s | UK GAAP (as previously reported) £’000s | Increase | ||||
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| Year ended 31 December 2004: | ||||||
| Profit before tax | 28,492 | 20,866 | 36.6% | |||
| Profit before goodwill amortisation and tax | 28,492 | 26,793 | 6.3% | |||
| Earnings per ordinary share | ||||||
| - basic | 48.99p | 32.23p | 52.0% | |||
| - basic before goodwill amortisation | 48.99p | 46.79p | 4.7% | |||
| Total equity as at 1 January 2004 | 106,835 | 105,902 | 0.9% | |||
| Total equity as at 31 December 2004 | 117,440 | 110,585 | 6.2% | |||
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The most significant changes from the transition to IFRS are:
- the cessation of goodwill amortisation, which has had the largest impact on profit (IFRS 3)
- not accruing a liability for dividends that have not been declared and approved (IAS 10)
- the inclusion of fair value charges in respect of outstanding employee share options granted after 7 November 2002 (and not vested by 1 January 2005) spread over the vesting period (IFRS 2)
- the replacement of existing charges for other share based payment awards with fair value charges for those awards granted after 7 November 2002 (and not vested by 1 January 2005) spread over the vesting period (which is a revised time period to that adopted under UK GAAP in some instances) (IFRS 2)
- the inclusion in the balance sheet of all employee benefit liabilities (largely the defined benefit pension scheme deficits) (IAS 19)
- the classification of equity investments as available-for-sale (IAS 39)
- the tax effect of the above adjustments for IFRS, where applicable, and provision of deferred tax in relation to unremitted overseas earnings (IAS 12)
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