BT 2009 Annual Report Download - page 140

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ADDITIONAL INFORMATION FINANCIAL STATEMENTS REPORT OF THE DIRECTORS BUSINESS AND FINANCIAL REVIEWS OVERVIEW
138 BT GROUP PLC ANNUAL REPORT & FORM 20-F
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS OF BT GROUP PLC
BT Group plc accounting policies
(i) Accounting basis
As used in these financial statements and associated notes, the
term ‘company’ refers to BT Group plc. These separate financial
statements of the company are presented as required by the
Companies Act 1985. The separate financial statements have
been prepared in accordance with UK Generally Accepted
Accounting Principles (UK GAAP).
The financial statements are prepared on a going concern basis
and under the historical cost convention as modified by the
revaluation of certain financial instruments at fair value.
As permitted by Section 230(3) of the Companies Act 1985, the
company’s profit and loss account has not been presented.
The BT Group plc consolidated financial statements for the year
ended 31 March 2009 contain a consolidated statement of cash
flows. Consequently, the company has taken advantage of the
exemption in FRS 1, ‘Cash Flow Statements’, not to present its
own cash flow statement.
The BT Group plc consolidated financial statements for the
year ended 31 March 2009 contain related party disclosures.
Consequently, the company has taken advantage of the
exemption in FRS 8, ‘Related Party Disclosures’, not to disclose
transactions with other members of the BT Group.
The BT Group plc consolidated financial statements for the year
ended 31 March 2009 contain financial instrument disclosures
which comply with FRS 29, ‘Financial Instruments: Disclosures’.
Consequently, the company is exempted by FRS 29 from
providing its disclosure requirements in respect of its financial
instruments.
(ii) Investments in subsidiary undertakings
Investments in subsidiary undertakings are stated at cost and
reviewed for impairment if there are indicators that the carrying
value may not be recoverable.
(iii) Taxation
Full provision is made for deferred taxation on all timing
differences which have arisen but not reversed at the balance
sheet date. Deferred tax assets are recognised to the extent that
it is regarded as more likely than not that there will be sufficient
taxable profits from which the underlying timing differences can
be deducted. The deferred tax balances are not discounted.
(iv) Dividends
Dividend distributions are recognised as a liability in the year in
which the dividends are approved by the company’s shareholders.
Interim dividends are recognised when they are paid; final
dividends when authorised in general meetings by shareholders.
(v) Share capital
Ordinary shares are classified as equity. Repurchased shares of the
company are recorded in the balance sheet as treasury shares and
presented as a deduction from shareholders’ equity at cost.
(vi) Cash
Cash includes cash in hand and bank deposits repayable on
demand.
(vii) Share based payments
The company does not incur a charge for share based payments.
However, the issuance by the company of share options and
awards to employees of its subsidiaries represents additional
capital contributions to its subsidiaries. An addition to the
company’s investment in subsidiaries is recorded with a
corresponding increase in equity shareholders’ funds. The
additional capital contribution is determined based on the fair
value of options and awards at the date of grant and is recognised
over the vesting period.
Other information
(i) Dividends
The directors are proposing that a final dividend in respect of
the year ended 31 March 2009 of 1.1 pence will be paid to
shareholders on 7 September 2009, taking the full year proposed
dividend in respect of the 2009 financial year to 6.5 pence (2008:
15.8 pence). This dividend is subject to shareholder approval at
the Annual General Meeting and therefore the liability of
approximately £85m (2008: £805m) has not been included in
these financial statements.
(ii) Employees
The executive directors and the Chairman of BT Group plc were
the only employees of the company during the 2009 financial
year. The costs relating to qualifying services provided to the
company’s principal subsidiary, British Telecommunications plc,
are recharged to that company.
FINANCIAL STATEMENTS