BT 2009 Annual Report Download - page 33

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ADDITIONAL INFORMATION FINANCIAL STATEMENTS REPORT OF THE DIRECTORS BUSINESS AND FINANCIAL REVIEWS OVERVIEW
BUSINESS AND FINANCIAL REVIEWS OTHER MATTERS
31BT GROUP PLC ANNUAL REPORT & FORM 20-F
BUSINESS AND FINANCIAL REVIEWS
Security and resilience
We are critically dependant on the secure operation and resilience
of our information systems, networks and data.
Any significant failure or interruption of data transfer as a result
of factors outside our control could have a material adverse effect
on the business and our results from operations. We have a
corporate resilience strategy and business continuity plans in place,
designed to deal with such catastrophic events including, for
example, major terrorist action, industrial action, extreme
computer virus attack, hurricane or flooding. A failure to deliver
that strategy may lead to a reduction in our profitability and there
can be no assurance that material adverse events will not occur.
The scale of our business and global nature of our operations
means we are required to manage significant volumes of personal
and sensitive information. We also store and transmit data for our
customers all of which needs to be safeguarded from potential
exposure and therefore requires a high level of management and
security.
Pensions
We have a significant funding obligation to a defined benefit
pension scheme.
Declining investment returns, longer life expectancy and
regulatory changes may result in the cost of funding BT’s defined
benefit pension scheme (BTPS) becoming a significant burden on
our financial resources. Whilst the triennial actuarial funding
valuation as at 31 December 2008 has not yet been completed, as
detailed on page 43, BT and the Trustee of the BTPS have agreed
that deficit contributions of £525m per annum will be made over
the next three years. This agreement has been approved by the
Pensions Regulator.
The results of future scheme valuations and associated funding
requirements will be impacted by the future performance of
investment markets, interest and inflation rates and the general
trend towards longer life expectancy, as well as regulatory changes,
all of which are outside our control.