Unilever 2006 Annual Report Download - page 114

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Unilever Annual Report and Accounts 2006 111
Financial Statements (continued)
Notes to the consolidated accounts Unilever Group
24 Retained profit
€million €million € million €million €million € million €million €million € million
NV NVNVPLC PLC PLC Total Total Total
Movements during the year 2006 2005 2004 2006 2005 2004 2006 2005 2004
31 December 2004 8 331 (684) 7 647
Accounting policy change for
financial instruments(a) (1 500) 1 907 407
1January 8721 6831 7 321 1294 1 223 (315) 10 015 8 054 7 006
Recognised income and expense through
retained profit 3727 3 092 1 520 1848 733 636 5575 3 825 2 156
Preference dividends(b) –– (28) ––––– (28)
Final dividends 2003 on ordinary capital –– (630) –– (486) –– (1 116)
Interim dividends 2004 on ordinary capital –– (343) –– (260) –– (603)
Final dividends 2004 on ordinary capital –(710) – –(519) – –(1 229) –
Interim dividends 2005 on ordinary capital –(363) – –(275) – –(638) –
Final dividends 2005 on ordinary capital (722) ––(547) ––(1 269) ––
Interim dividends 2006 on ordinary capital (379) ––(285) ––(664) ––
One-off dividend (428) ––(323) ––(751) ––
Conversion of preference shares –(199) – ––––(199) –
Utilisation of treasury stock (217) –7(68) ––(285) –7
Share-based compensation credit(c) 70 132 152 41 54 70 111 186 222
Adjustment arising from change in structure
of group companies(d) (2 368) (70) 332 2368 70 (332) –––
Other movements in retained profit –8–(8) 83(8) 16 3
31 December 8404 8 721 8 331 4320 1 294 (684) 12 724 10 015 7 647
Of which retained by:
Parent companies 9755 9463 7 693 2306 2145 1553 12 061 11 608 9 246
Other group companies (1 294) (668) 731 2006 (837) (2 235) 712 (1 505) (1 504)
Joint ventures and associates (57) (74) (93) 8(14) (2) (49) (88) (95)
8404 8 721 8 331 4320 1 294 (684) 12 724 10 015 7 647
(a) Due to the adoption of IAS 32 and IAS 39 with effect from 1 January 2005, intra-group preference shares are now classified as debt
instead of equity. The relative ownership of these preference shares has resulted in a realignment of balances between NV and PLC.
(b) From 1 January 2005, Unilever adopted IAS 32 which requires preference shares that provide for a fixed preference dividend to be classified
as borrowings and preference dividends to be recognised in the income statement. In accordance with the transition rules for IAS 32, 2004
was not restated.
(c) The share-based compensation credit relates to the reversal of the non-cash charge recorded against operating profit in respect of the fair
value of share options and awards granted to employees.
(d) As part of the review of Unilever's corporate structure, and in the light of the constitutional and operational arrangements which enable
Unilever N.V. and Unilever PLC to operate as nearly as practicable as a single company, the Directors have been authorised to take any
action necessary or desirable in order to ensure that the ratio of the dividend generating capacity of Unilever PLC to that of Unilever N.V.
does not differ substantially from the ratio of the dividend entitlement of ordinary shareholders in Unilever PLC to that of ordinary
shareholders in Unilever N.V. Therefore, in 2006, shareholdings in the Unilever companies in Czech Republic, Hungary, Russia and Turkey,
as well as a part of indirect shareholdings in Unilever US, have been transferred from Unilever N.V. to Unilever PLC for no consideration.
In addition, part of a dividend which would otherwise be due from a Unilever US intermediate company to a company within the
Unilever N.V. part of the Group has instead been paid to a company within the Unilever PLC part of the Group. Re-organisations of
group companies have produced similar types of adjustments in previous years.
Cumulative goodwill written off directly to reserves prior to the transition to IFRS on 1 January 2004 was €5 199 million for NV and
€2 063 million for PLC.