Bank of Montreal 2010 Annual Report Download - page 167

Notes
BMO Financial Group 193rd Annual Report 2010 165
Note 30: Reconciliation of Canadian and United States
Generally Accepted Accounting Principles
Condensed Consolidated Balance Sheet
As at October 31 (Canadian $ in millions) 2010 2009 (2)
Canadian Increase United States Canadian Increase United States
GAAP (Decrease) GAAP GAAP (Decrease) GAAP
Assets
Cash and cash equivalents 17,368 – 17,368 9,955 – 9,955
Interest bearing deposits with banks (a) 3,186 (1,925) 1,261 3,340 (2,117) 1,223
Securities – Trading (b,c,d) 71,710 (2,496) 69,214 59,071 (3,901) 55,170
– Available-for-sale (b,c,d,e,o) 50,543 7,465 58,008 50,257 2,799 53,056
– Other (f) 1,146 (80) 1,066 1,485 (7) 1,478
Securities borrowed or purchased under resale agreements 28,102 – 28,102 36,006 – 36,006
Loans and customers’ liability under acceptances,
net of the allowance for credit losses (a,g) 176,643 779 177,422 167,829 2,069 169,898
Derivative instruments (g) 49,759 (33,631) 16,128 47,898 (30,296) 17,602
Premises and equipment (i) 1,560 (3) 1,557 1,634 (4) 1,630
Goodwill (i,p) 1,619 (44) 1,575 1,569 (37) 1,532
Intangible assets (i) 812 – 812 660 – 660
Other assets (b,d,f,j,k,m,o,p) 9,192 6,713 15,905 8,754 6,232 14,986
Total Assets 411,640 (23,222) 388,418 388,458 (25,262) 363,196
Liabilities and Shareholders’ Equity
Deposits (g) 249,251 (2,094) 247,157 236,156 (1,298) 234,858
Derivative instruments (g) 47,970 (32,683) 15,287 44,765 (29,046) 15,719
Acceptances 7,001 – 7,001 7,640 – 7,640
Securities sold but not yet purchased 16,438 – 16,438 12,064 – 12,064
Securities lent or sold under repurchase agreements 47,110 – 47,110 46,312 – 46,312
Other liabilities (b,d,e,j,m,n) 17,414 11,076 28,490 15,938 4,483 20,421
Subordinated debt 3,776 – 3,776 4,236 – 4,236
Capital trust securities (l) 800 (800) – 1,150 (1,150) –
Shareholders’ equity (c,d,f,h,i,j,k,l,n,o,p) (1) 21,880 1,279 23,159 20,197 1,749 21,946
Total Liabilities and Shareholders’ Equity 411,640 (23,222) 388,418 388,458 (25,262) 363,196
We prepare our consolidated financial statements in accordance with
GAAP in Canada, including interpretations of GAAP by our regulator, the
Office of the Superintendent of Financial Institutions Canada (“OSFI”).
We have included here the significant differences that would result
if United States GAAP were applied in the preparation of our Consolidated
Balance Sheet, Consolidated Statement of Income, Consolidated
Statement of Comprehensive Income and Consolidated Statement
of Accumulated Other Comprehensive Loss. We have not included
our Consolidated Statement of Cash Flows as the differences
are immaterial.
(1) Under United States GAAP, shareholders’ equity includes non-controlling interest
of $2,138 million ($2,505 million in 2009).
(2) Prior year has been restated to give effect to the adoption of the new U.S. accounting standard
for non-controlling interests in consolidated financial statements (n).
Certain comparative figures have been reclassified to conform with the current year’s presentation.
Reconciliation of Income
For the Year Ended October 31 (Canadian $ in millions, except per share amounts) 2010 2009 2008
Net income before non-controlling interest, as reported under Canadian GAAP 2,884 1,863 2,052
Adjustments to arrive at United States GAAP:
Net Interest Income – Liabilities and equity (l) 71 80 91
Non-Interest Revenue – Merchant banking (f) (73) 92 (2)
– Reclassification from trading securities to available-for-sale securities (c) 92 91 (183)
– Insurance (d) 13 (23) –
– Derivatives (h) 211 3 –
–
Other-than-temporary impairment (o) (6) – –
Non-Interest Expense – Stock-based compensation (k) – (1) (5)
– Software development costs (q) – – (1)
– Pension and other employee future benefits (j) (9) – 6
– Goodwill and other assets (i) – 6 5
– Business combination (p) (8) – –
Income taxes and net change in income taxes (m) (including adjustments due to items listed above) (65) (49) 58
Net income before non-controlling interest, based on United States GAAP 3,110 2,062 2,021
Non-controlling interest in subsidiaries, as reported under Canadian GAAP 74 76 74
Adjustment to non-controlling interest to arrive at United States GAAP 71 79 79
Non-controlling interest in subsidiaries, based on United States GAAP 145 155 153
Net income available to common shareholders, based on United States GAAP 2,965 1,907 1,868
Earnings per share: basic – Canadian GAAP net income 4.78 3.09 3.79
– United States GAAP net income 5.05 3.31 3.57
Earnings per share: diluted – Canadian GAAP net income 4.75 3.08 3.76
– United States GAAP net income 5.03 3.30 3.54
Certain comparative figures have been reclassified to conform with the current year’s presentation.