Marks and Spencer 2002 Annual Report Download - page 47

www.marksandspencer.com 45
21. Analysis of financial liabilities continued
C Borrowing facilities
At 30 March 2002, the Group had an undrawn committed facility of £425.0m (last year £425.0m) linked to its
commercial paper programme and subject to annual review. The Group also has a number of undrawn uncommitted
facilities available to it. At 30 March 2002 these amounted to £376.8m (last year £547.5m).
22. Provisions for liabilities and charges Group
Post-retirement UK Overseas Deferred
health benefits1restructuring2restructuring3tax4Total
£m £m £m £m £m
At 1 April 2001 27.7 43.2 201.3 43.5 315.7
Prior year adjustment (see note 7) – – – 79.6 79.6
At 1 April 2001 as restated 27.7 43.2 201.3 123.1 395.3
Provided in the period – 7.0 – – 7.0
Utilised during the period (1.7) (30.1) (137.6) – (169.4)
Credited to the profit and loss account – – – (18.2) (18.2)
Disposal of subsidiaries – – – 1.5 1.5
Increase due to unwinding of discount 1.7–––1.7
Released in the period (2.4) – (10.0) – (12.4)
Exchange differences – – (1.7) – (1.7)
At 30 March 2002 25.3 20.1 52.0 106.4 203.8
1The £25.3m provision for post-retirement health benefits represents the estimated value of the Group’s subsidy of the Marks & Spencer
Health Insurance Scheme, in so far as it relates to private medical benefits for retired employees and their dependants, for whom the
Group meets the whole, or part, of the cost (see note 11B for further details).
2The provision for UK restructuring costs relates to the costs of restructuring the Group’s UK operations. The majority of these costs are
expected to be incurred during the next financial year with the exception of costs associated with the Early Retirement Plan which are
anticipated to be incurred over the next eight years.
3The provision for Overseas restructuring costs primarily relates to further closure costs in respect of the discontinuation of the Group’s
operations in Continental Europe. The majority of which are expected to be incurred during the next financial year.
4The provision for deferred tax has been restated as at 1 April 2001 following the adoption of Financial Reporting Standard 19
‘Accounting for deferred tax’. The deferred tax balance comprises the following:
2002 2001
£m £m
Accelerated capital allowances 69.0 79.6
Pension prepayment 50.8 48.8
Other short-term timing differences (13.4) (5.3)
106.4 123.1
Deferred tax is not provided in respect of liabilities which might arise on the distribution of unappropriated profits
of international subsidiaries.
23. Financial instruments and risk management
A Fair values of financial instruments
Set out below is a comparison of current and book values of all the Group’s financial instruments by category. Where
market prices are not available for a particular instrument, fair values have been calculated by discounting cash flows
at prevailing interest rates and exchange rates. Group
2002 2001
Book value Fair value Book value Fair value
Assets/(liabilities) £m £m £m £m
Customer advances falling due in more than one year 1,603.1 1,610.9 1,630.1 1,646.2
Current asset investments1272.7 272.7 260.0 255.5
Fixed asset investments229.6 29.6 38.5 38.5
Cash at bank and in hand1543.4 543.4 154.4 154.4
Borrowings due within one year1(677.7) (675.6) (1,044.1) (1,039.6)
B Shares (276.0) (276.0) ––
Financial liabilities due after more than one year1(2,046.6) (2,081.1) (650.3) (694.7)
Interest rate swaps3– 16.9 – 22.6
Forward foreign currency contracts3– 2.1 – (1.4)
FTSE 100 put options40.4 1.3 1.3 2.8
1Current asset investments and cash at bank are predominantly short-term deposits placed with banks, financial institutions and on money
markets, and investments in short-term securities. Borrowings are at floating rates. Therefore, fair values closely approximate book values.
2Fixed asset investments comprise listed securities held by a subsidiary which are stated at market value.
3Interest rate swaps and forward foreign currency contracts have been marked to market to produce a fair value figure.
4FTSE 100 put options provide no loss guarantees on certain Unit Trust offers. The options are on a fully matched basis and are not
traded. They have been marked to market to produce a fair value figure.