Aviva 2005 Annual Report Download - page 95

Notes to the consolidated financial statements
1 – First time adoption of International Financial Reporting Standards
(a) The Group has adopted International Financial Reporting Standards (IFRS) for these financial statements for the year ended
31 December 2005. In order to show comparative balances, the year ended 31 December 2004 is also shown under IFRS.
The date of transition to IFRS is 1 January 2004.
In general, a company is required to determine its IFRS accounting policies and apply these retrospectively to determine its opening
balance sheet under IFRS. However, International Financial Reporting Standard 1, First time adoption of International Financial Reporting
Standards, (IFRS 1) allows a number of exemptions to this general principle upon adoption of IFRS. The Group has taken advantage of
the following transitional arrangements.
Business combinations
The Group has elected not to apply retrospectively the provisions of IFRS 3, Business Combinations, to business combinations that
occurred prior to 1 January 2004. At the date of transition, no adjustment was made between UK GAAP and IFRS for any historical
business combination.
Cumulative translation differences
The Group has elected that the cumulative translation differences of foreign operations were deemed to be zero at the transition date
to IFRS.
Equity compensation plans
The Group has elected not to apply the provisions of IFRS 2, Share-based Payment, to options and awards granted on or before
7 November 2002 which had not vested by 1 January 2005.
Employee benefits
All cumulative actuarial gains and losses on the Group’s defined benefit pension schemes have been recognised in equity at the
transition date.
Comparatives
The Group has not taken advantage of the exemption within IFRS 1 that allows comparative information presented in the first year
of adoption of IFRS not to comply with IAS 32, Financial Instruments: Disclosure and Presentation, IAS 39, Financial Instruments:
Recognition and Measurement and IFRS 4, Insurance Contracts.
Estimates
Where estimates had previously been made under UK GAAP, consistent estimates (after adjustments to reflect any difference in
accounting policies) have been made for the same date on transition to IFRS (ie judgements affecting the Group’s opening balance
sheet have not been revisited for the benefit of hindsight).
Held for sale
The requirements of International Financial Reporting Standard 5, Non-current Assets Held for Sale and Discontinued Operations, have
been applied prospectively from 1 January 2005.
Transitional provisions
The Group has elected to disclose only five years of data in its loss development tables, as permitted by IFRS 4 in the year of adoption of
IFRS. This will be increased in each succeeding additional year, until the full ten years of information is included.
Financial statements
Aviva plc 2005
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