BT 2000 Annual Report Download - page 105

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accounting under US GAAP. These ¢nancial instruments, under US GAAP, are carried at market value with valuation
adjustments recorded in pro¢t and loss. Own shares held in trust are treated as a reduction to shareholders' equity until
they are reissued to employees. The reassessment and purchase of derivatives in the year ended 31 March 2000 gave rise to
an adjustment reducing net income by »95 million. The net unrealised holding gain on available-for-sale securities for the
year ended 31 March 2000 was »311 million (1999 --- »76 million, 1998 --- »1,315 million relating primarily to the
investment in MCI).
(g) Deferred gain
Under UK GAAP, assets contributed to a joint venture by the group's partners are measured at their net replacement cost.
Any di¡erence between the group's share of the joint venture's resulting net assets and the net book value of assets
contributed by the group to the joint venture, including certain accrued start up costs, is immediately re£ected by
adjusting the group's investment in the joint venture and recording a deferred di¡erence in shareholders' equity. Under US
GAAP, the assets contributed by all joint venture partners are carried at their historical net book value and any di¡erence
between the group's share of the joint venture's resulting net assets and the net book value of assets contributed by the
group to the joint venture is amortised over the life of the items giving rise to the di¡erence.
(h) Deferred taxation
Under UK GAAP, provision for deferred taxation is generally only made for timing di¡erences which are expected to
reverse. Under US GAAP, deferred taxation is provided on a full liability basis on all temporary di¡erences as de¢ned in
SFAS No. 109.
At 31 March 2000, the adjustment of »1,377 million (1999 --- »1,424 million) reconciling ordinary shareholders' equity
under UK GAAP to the approximate amount under US GAAP included the tax e¡ect of other US GAAP adjustments.
This comprised an adjustment increasing non-current assets by »25 million (1999 --- »59 million increase); an adjustment
increasing current assets by »63 million (1999 --- »50 million increase); an adjustment decreasing minority interests
by »35 million (1999 --- »11 million decrease) and an adjustment increasing long-term liabilities by »1,500 million
(1999 --- »1,544 million increase).
(i) Dividends
Under UK GAAP, dividends are recorded in the year in respect of which they are declared (in the case of interim or any
special dividends) or proposed by the board of directors to the shareholders (in the case of ¢nal dividends). Under US
GAAP, dividends are recorded in the period in which dividends are declared.
United States Generally Accepted Accounting Principles
104 Annual report and Form 20-F