Aviva 2013 Annual Report Download - page 246

Aviva plc
Annual report and accounts 2013
244
Notes to the Company’s financial statements continued
E – Reserves
Merger
reserve
£m
Investment
valuation
reserve
£m
Equity
compen-
sation
reserve
£m
Retained
earnings
£m
Balance at 1 January 2012 735 4,414 86 3,116
Arising in the year:
Profit for the year — — — 616
Fair value gains on investments in subsidiaries and
j
oint ventures — 2,126 — —
Impairment losses on assets previously revalued through other comprehensive income now taken
to the income statement — 254 — —
Dividends and appropriations — — — (847)
Reserves credit for equity compensation plans — — 42 —
Shares issued in lieu of dividends — — — 127
Trust shares distributed in the year — — — (44)
Issue of share capital under equity compensation scheme — — (68) 74
Aggregate tax effect — — — 18
Balance at 31 December 2012 735 6,794 60 3,060
Arising in the year:
Profit for the year — — — 602
Fair value gains on investments in subsidiaries and
j
oint ventures — 2,108 — —
Actuarial loss on pension provision — — — (2)
Impairment losses on assets previously revalued through other comprehensive income now taken
to the income statement — — — —
Dividends and appropriations — — — (538)
Reserves credit for equity compensation plans — — 37 —
Shares issued in lieu of dividends — — — —
Trust shares distributed in the year — — — (33)
Issue of share capital under equity compensation scheme — — (43) 47
Aggregate tax effect — — — 22
Balance at 31 December 2013 735 8,902 54 3,158
Tax of £22 million (2012: £18 million) is deductible in respect of coupon payments of £92 million (2012: £73 million) on the direct
capital instruments and fixed rate tier 1 notes.
F – Borrowings
The Company’s borrowings comprise:
2013
£m
2012
£m
Subordinated debt 4,370 4,337
9.5% guaranteed bonds 2016 199 199
Commercial paper 556 603
Total 5,125 5,139
Maturity analysis of contractual undiscounted cash flows:
2013 2012
Principal
£m
Interest
£m
Total
£m
Principal
£m
Interest
£m
Total
£m
Within 1 year 556 314 870 603 307 910
1 to 5 years 200 1,204 1,404 200 1,197 1,397
5 to 10 years 242 1,348 1,590 241 1,342 1,583
10 to 15 years — 1,341 1,341 527 1,192 1,719
Over 15 years 4,165 2,950 7,115 3,608 2,610 6,218
Total contractual undiscounted cash flows 5,163 7,157 12,320 5,179 6,648 11,827
Where subordinated debt is undated, the interest payments have not been included beyond 15 years. Annual interest payments for
these borrowings are £73 million (2012: £72 million).
The fair value of the subordinated debt at 31 December 2013 was £4,707 million (2012: £4,435 million), calculated with
reference to quoted prices. The fair value of the 9.5% guaranteed bonds 2016 at 31 December 2013 was £236 million (2012:
£246 million), calculated with reference to quoted prices. The fair value of the commercial paper is considered to be the same as
its carrying value.
On 28 February 2014, the Company notified the respective holders of the £200 million subordinated notes due 2019 and the
€50 million subordinated notes due 2019 that it would redeem each of the notes on their respective first call dates in April 2014.
Further details of these borrowings and undrawn committed facilities can be found in the Group consolidated financial
statements, note 50, with details of the fair value hierarchy in relation to these borrowings in note 23.
G – Contingent liabilities
Details of the Company’s contingent liabilities are given in the Group consolidated financial statements, note 53.