Vodafone 2002 Annual Report Download - page 116

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Vodafone Group Plc Annual Report & Accounts and Form 20-F Notes to the Consolidated Financial Statements114
Notes to the Consolidated Financial Statements continued
Impact on cash flows
Eircell contributed £163m to the Group’s net operating cash flows, paid £12m in respect of taxation and utilised £102m for investing activities, following the
Group’s acquisition.
Pre-acquisition results of Eircell
Eircell did not trade until 11 May 2001, when eircom plc transferred assets and liabilities to Eircell from its subsidiary Eircell Limited. The profit after tax of
Eircell Limited for the period from 1 April 2001 to 14 May 2001 was £6m, and for the year ended 31 March 2001 was £33m. All balances were prepared
under Irish GAAP and translated at the average exchange rate of £1 : 11.63 (period from 1 April 2001 to 14 May 2001) and £1 : 11.63 (year ended
31 March 2001).
Other acquisitions
The Group undertook a number of other acquisitions during the year as summarised below: Fair value net
assets/(liabilities) Goodwill
Consideration(5) acquired capitalised
£m £m £m
Airtel (stake increase from 73.8% to 91.6%) 1,086 85(2) 1,001
Grupo Iusacell 692 19(3) 673
Other(1) 540 (248)(4) 788
2,318 (144) 2,462
The goodwill has been allocated as follows:
Subsidiary undertakings 1,724
Customer bases 6
Associated undertakings 732
2,462
Note:
(1) Includes adjustments to goodwill resulting from fair value changes to prior year acquisitions, see below.
(2) No adjustments were made for fair values as compared with book values at acquisition.
(3) The principal fair value adjustments were in respect of intangible and tangible fixed assets, which were restated in accordance with UK GAAP.
(4) Principally comprises the fair value changes to prior year acquisitions shown below, and the acquisition of Mobile Communications Holdings (“MCH”).
There was no significant difference between the book value and the fair value of the acquired MCH net assets/(liabilities).
(5) Principally satisfied by cash.
Fair value changes to prior year acquisitions
In accordance with FRS 7, necessary adjustments to the provisional fair value and the corresponding adjustment to purchased goodwill can be made in the
year following acquisition. Adjustments to the fair values of Mannesmann, Verizon Wireless and Swisscom Mobile have been made on this basis.
Mannesmann – Further adjustments to the fair value of Mannesmann, which was disclosed in the year ended 31 March 2001, have increased the goodwill
value from £83,025m (after adjustments for FRS19) to £83,275m. This arises from a downward adjustment of £158m in relation to the value ascribed to
assets held for resale and £86m of other adjustments.
Verizon Wireless – The adjustments made to the fair value of Verizon Wireless during the year reduced the value of goodwill from £19,835m (after
adjustments for FRS19) to £19,825m. The net £10m adjustment reflects the final valuation of proceeds from disposal of conflicted properties.
Swisscom Mobile – Further fair value adjustments made in the year in respect of the Swisscom Mobile transaction in the prior year have revised the goodwill
value from £1,771m as previously reported, to £1,798m, reflecting the restatement of a deferred tax asset in accordance with UK GAAP.