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35. UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES continued
In September 2006, the FASB issued SFAS No 157, ‘Fair Value Measurements’ (‘‘FAS 157’’). FAS 157 defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value
measurements. The provisions of this standard apply to other accounting pronouncements that require or permit fair value
measurements. FAS 157 applies for the group’s financial year beginning 1 April 2008. The group is currently evaluating the impact,
if any, that the adoption of FAS 157 will have on the consolidated financial statements.
In February 2007, the FASB issued SFAS No 159, ‘The Fair value option for financial assets and financial liabilities’ (‘‘FAS 159’’).
FAS 159 permits entities to choose to measure, on an item by item basis, specified financial instruments and certain other items at
fair value. Unrealised gains and losses on items for which the fair value option has been elected are required to be reported in
earnings at each reporting date. FAS 159 is effective for the 2009 financial year, the provisions of which are required to be applied
prospectively. The group is currently evaluating the impact, if any, that the adoption of FAS 159 will have on the consolidated
financial statements.
In July 2006, the FASB issued Interpretation No 48 ‘Accounting for Uncertainty in Income Taxes – An Interpretation of FASB
Statement No 109’ (‘‘FIN 48’’). FIN 48 requires tax benefits from uncertain positions to be recognised only if it is ‘‘more likely than
not’’ that the position is sustainable based on its technical merits. The interpretation also requires qualitative and quantitative
disclosures, including discussion of reasonably possible changes that might occur in unrecognised tax benefits over the next
12 months, a description of open tax years by major jurisdiction, and a roll-forward of all unrecognised tax benefits. FIN 48 applies
for the group’s financial year beginning 1 April 2007. The group is currently in the process of quantifying the impact, if any, on the
consolidated financial statements.
In September 2006, the FASB ratified Emerging Issues Task Force No 06-01 ‘Accounting for Consideration Given by a Service
Provider to Manufactures or Resellers of Equipment Necessary for an End-Customer to Receive Service from the Service Provider’
(‘‘EITF 06-01’’). This guidance requires the application of EITF 01-09 ‘Accounting for Consideration Given by a Vendor to a Service
provider’s end customer’ (‘‘EITF 01-09’’), when consideration is given to a reseller or manufacturer for benefit to the service
provider’s end customer. EITF 01-09 requires the consideration given to be recorded as a liability at the time of the sale of the
equipment and, also, provides guidance for the classification of the expense. EITF 06-01 is effective for the group’s financial year
beginning 1 April 2008. The group is currently in the process of quantifying the impact, if any, on the consolidated financial
statements.
Consolidated financial statements Notes to the consolidated financial statements
142 BT Group plc Annual Report & Form 20-F