Unilever 2014 Annual Report Download - page 101

DEFERRED TAXATION
Full provson s made for deferred taxaton on all sgnfcant
tmng dfferences arsng from the recognton of tems for
taxaton purposes n dfferent perods from those n whch they
are ncluded n PL accounts Full provson s made at the rates
of tax prevalng at the year end unless future rates have been
enacted or substantvely enacted Deferred tax assets and
labltes have not been dscounted
SHARES HELD BY EMPLOYEE SHARE TRUSTS
Shares held to satsfy optons are accounted for n accordance
wth UKAAP, namely FRS 25 ‘Fnancal Instruments
Presentaton’, FRS20‘Share Based Payments’ and Urgent Issues
Task Force abstract 38 ‘Accountng for ESOP Trusts’ (UITF 38) All
dfferences between thepurchase prce of the shares held to
satsfy optons granted and theproceeds receved for the shares,
whether on exercse or lapse, arecharged to other reserves
DIVIDENDS
Under FRS 21 ‘Events after the Balance Sheet Date’, proposed
dvdends do not meet the defnton of a lablty untl such tme
asthey have been approved by shareholders at the Annual
eneral Meetng Therefore, we do not recognse a lablty n
anyperod for dvdends that have been proposed but wll not
be approved untl after the balance sheet date Ths holds for
externaldvdends as well as ntra-group dvdends pad to
theparentcompany
TAXATION
urrent tax s the expected tax payable on the taxable ncome for
the perod, usng tax rates enacted or substantvely enacted at the
balance sheet date, and any adustment to tax payable n respect
of prevous perods
PROVISIONS
Provsons are recognsed where a legal or constructve oblgaton
exsts at the balance sheet date, as a result of a past event, where
the amount of the oblgaton can be relably estmated and where
the outflow of economc beneft s probable Provsons are
measured on the bass of the best estmate of the amounts
requred to settle the oblgatons at the balance sheet date Unless
ndcated otherwse, provsons are stated at the face value of the
expendture expected to be requred to settle the oblgatons
FINANIAL UARANTEES
Where the ompany enters nto fnancal guarantee contracts to
guarantee the ndebtedness of other companes wthn ts group,
the ompany consders these to be nsurance arrangements and
accounts for them as such In ths respect, the ompany treats the
guarantee contract as a contngent lablty untl such tme as t
becomes probable that the ompany wll be requred to make a
payment under the guarantee
ACCOUNTING INFORMATION AND POLICIES
BASIS OF PREPARATION
The accounts have been prepared on a gong concern bass and n
accordance wth applcable Unted Kngdom accountng standards
and the UK ompanes Act 2006
The accounts are prepared under the hstorcal cost conventon
except for the revaluaton of fnancal assets classfed as
‘avalable-for-sale nvestments’ or ‘far value through proft
orloss’, and ‘dervatve fnancal nstruments’ n accordance
wththe accountng polces set out below whch have been
consstentlyappled
ADOPTION OF FRS 101 IN 2015
In 2012, the FR, beng the standard settng body n the UK,
publshed FRS 101 ‘Reduced Dsclosure Framework’ whch s
avalable to qualfyng enttes that prepare ther annual report
and accounts under EU adopted IFRS (Internatonal Fnancal
Reportng Standards) Ths outlnes a reduced dsclosure
framework avalable to qualfyng enttes and all UK enttes wll
be requred to adopt ths or an alternatve standard n 2015
Unlever PL ntends to prepare ts accounts under FRS 101 for
the frst tme n 2015 The consoldated accounts for the roup
wll contnue to be prepared under full IFRS The Board consders
that t s n the best nterests of the roup for Unlever PL to
adopt FRS 101 ‘Reduced Dsclosure Framework’
A shareholder or shareholders holdng n aggregate 5% or more
of the total allotted shares n Unlever PL may serve obectons
to the use of the dsclosure exemptons on Unlever PL, n
wrtng, to ts corporate offce (100 Vctora Embankment, London,
E4Y 0DY) not later than 30 June 2015 and, f so receved, Unlever
PL may not use these dsclosure exemptons
ACCOUNTING POLICIES
The prncpal accountng polces are as follows
INTANIBLE ASSETS
Intangble assets comprse trademarks purchased after
1January 1998 and are amortsed n the proft and loss account
over ther expected useful lves of up to a maxmum of 20 years
These assets are held at cost less accumulated amortsaton
They are subect to revew for mparment n accordance wth
Unted Kngdom Fnancal Reportng Standard 11 ‘Imparment of
Fxed Assets and oodwll’ (FRS 11) Any mparment s charged
tothe proft and loss account as t arses
INVESTMENTS IN SUBSIDIARIES
Shares n group companes are stated at cost less any amounts
wrtten off to reflect a permanent mparment Any mparment
scharged to the proft and loss account as t arses
FINANIAL INSTRUMENTS
The company’s accountng polces under Unted Kngdom
generallyaccepted accountng prncples (UK AAP), namely
FRS25 ‘Fnancal Instruments Presentaton’, FRS 26 ‘Fnancal
Instruments Measurement’ and FRS 29 ‘Fnancal Instruments
Dsclosures’, are the same as the Unlever roup’s accountng
polces under Internatonal Fnancal Reportng Standards (IFRS)
namely IAS 32 ‘Fnancal Instruments Presentaton’, IAS 39
‘Fnancal Instruments Recognton and Measurement’ and
IFRS7 ‘Fnancal Instruments Dsclosures’ Thepolces are set
out under the headng ‘aptal and fundng’ nnote 15 to the
consoldated accounts on pages 109 and 110 PL s takng the
exempton for fnancal nstruments dsclosures, because IFRS 7
dsclosures are gven n notes 15 to 18 to the consoldated
accounts on pages 109 to 123
138 Unilever Annual Report and Accounts 2014Financial statements
NOTES TO THE OMPANY AOUNTS
UNILEVER PL