Vodafone 2008 Annual Report Download - page 138

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2. Significant accounting policies continued
Fair value hedges
The Company’s policy is to use derivative instruments (primarily interest rate swaps) to convert a proportion of its fixed rate debt to floating rates in order to hedge the
interest rate risk arising, principally, from capital market borrowings.
The Company designates these as fair value hedges of interest rate risk with changes in fair value of the hedging instrument recognised in the profit and loss account
for the period together with the changes in the fair value of the hedged item due to the hedged risk, to the extent the hedge is effective. The ineffective portion is
recognised immediately in the profit and loss account.
Share-based payments
The Group operates a number of equity settled share based compensation plans for the employees of subsidiary undertakings using the Company’s equity
instruments. The fair value of the compensation given in respect of these share based compensation plans is recognised as a capital contribution to the Company’s
subsidiary undertakings over the vesting period. The capital contribution is reduced by any payments received from subsidiary undertakings in respect of these share-
based payments.
Dividends paid and received
Dividends paid and received are included in the Company Financial Statements in the period in which the related dividends are actually paid or received or, in respect
of the Company’s final dividend for the year, approved by shareholders.
Pensions
The Company is the sponsoring employer of the Vodafone Group Pension Scheme, a defined benefit pension scheme. The Company is unable to identify its share
of the underlying assets and liabilities of the Vodafone Group Pension Scheme on a consistent and reasonable basis. Therefore, the Company has applied the
guidance within FRS 17 to account for defined benefit schemes as if they were defined contribution schemes and recognise only the contribution payable each year.
The Company had no contributions payable for the years ended 31 March 2008 and 31 March 2007.
3. Fixed assets
Shares in Group undertakings
£m
Cost:
1 April 2007 72,322
Additions 24
Capital contributions arising from share-based payments 107
Contributions received in relation to share-based payments (191)
Disposals (2,069)
31 March 2008 70,193
Amounts provided for:
1 April 2007 5,183
Amounts provided for during the year 88
31 March 2008 5,271
Net book value:
31 March 2007 67,139
31 March 2008 64,922
At 31 March 2008, the Company had the following principal subsidiary undertakings:
Country of Percentage
Name Principal activity incorporation shareholding
Vodafone European Investments Holding company England 100.0
Vodafone Group Services Limited Global products and services provider England 100.0
4. Debtors
2008 2007
£m £m
Amounts falling due within one year:
Amounts owed by subsidiary undertakings 125,838 99,071
Taxation recoverable 137 137
Other debtors 124 196
126,099 99,404
Amounts falling due after more than one year:
Deferred taxation 4 3
Other debtors 817 224
821 227
136 Vodafone Group Plc Annual Report 2008
Notes to the Company Financial Statements continued
Vodafone – Financials