BT 2002 Annual Report Download - page 133

V Consolidated statements of cash ¯ows continued
The following statements summarise the statements of cash ¯ows as if they had been presented in accordance with
US GAAP, and include the adjustments which reconcile cash and cash equivalents under US GAAP to cash at bank and in
hand reported under UK GAAP.
2002
£m
2001
£m
2000
£m
Net cash provided by operating activities 1,455 5,515 4,003
Net cash used in investing activities 3,049 (22,785) (9,104)
Net cash provided by (used in) ®nancing activities (5,611) 18,311 4,697
Net increase (decrease) in cash and cash equivalents (1,107) 1,041 (404)
Effect of exchange rate changes on cash (50) (15) (1)
Cash and cash equivalents under US GAAP at beginning of year 2,281 1,255 1,660
Cash and cash equivalents under US GAAP at end of year 1,124 2,281 1,255
Short-term investments with original maturities of less than three months (966) (1,869) (1,002)
Cash at bank and in hand under UK GAAP at end of year 158 412 253
VI Current asset investments
Under US GAAP, investments in debt securities would be classi®ed as either trading, available-for-sale or held-to-maturity.
Trading investments would be stated at fair values and the unrealised gains and losses would be included in income.
Securities classi®ed as available-for-sale would be stated at fair values, with unrealised gains and losses, net of deferred
taxes, reported in shareholders' equity. Debt securities classi®ed as held-to-maturity would be stated at amortised cost.
The following analyses do not include securities with original maturities of less than three months.
At 31 March 2002, the group held trading investments (as de®ned by US GAAP) at a carrying amount of £1,245 million
(2001 ± £390 million) with fair values totalling £1,260 million (2001 ± £394 million). Held-to-maturity securities at 31 March
2001 and 2002 consisted of the following:
Amortised
cost
£m
Estimated
fair value
£m
Commercial paper, medium-term notes and other investments 2,372 2,372
Total at 31 March 2002 2,372 2,372
UK Government securities and other UK listed investments 8 8
Commercial paper, medium-term notes and other investments 30 30
Total at 31 March 2001 38 38
The contractual maturities of the held-to-maturity debt securities at 31 March 2002 were as follows:
Cost
£m
Fair value
£m
Maturing on or before 31 March 2003 2,370 2,370
Maturing after 31 March 2003 2 2
Total at 31 March 2002 2,372 2,372
VII Pension costs
The following position for the main pension scheme is computed in accordance with US GAAP pension accounting rules
under SFAS No. 87 and SFAS No. 88, the effect of which is shown in the above reconciliation statements.
The pension cost determined under SFAS No. 87 was calculated by reference to an expected long-term rate of return
on scheme assets of 6.5% (2001 ± 6.25%, 2000 ± 6.5%). The components of the pension cost for the main pension
scheme comprised:
2002
£m
2001
£m
2000
£m
Service cost 564 580 498
Interest cost 1,739 1,673 1,459
Expected return on scheme assets (1,863) (1,850) (1,600)
Amortisation of prior service costs 24 24 24
Amortisation of net obligation at date of limited application of SFAS No. 87 52 52 52
Recognised gains (67) (133) (65)
Additional cost of termination bene®ts 140 349 263
Pension cost for the year under US GAAP 589 695 631
United States Generally Accepted Accounting Principles
132 BT Group Annual Report and Form 20-F 2002