Barclays 2003 Annual Report Download - page 121

Barclays PLC Annual Report 2003 119
finalised late in 2003, with one key standard, ‘Financial Instruments:
Recognition and Measurement’ (IAS 39), expected to be substantially
completed by the end of March 2004. This standard and ‘Financial
Instruments: Disclosure and Presentation’ (IAS 32) are expected to
have significant impact on the reported results. Other standards,
particularly ‘Employee Benefits’ (IAS 19) and proposals for accounting
for share based payments and goodwill are also expected to have
significant impact.
The Group commenced a programme of work in 2002, initially
identifying the differences between IFRS and existing UK standards based
on the requirements then in force. This led to a programme of work led
centrally, but involving all the business units and functions, to change
systems and processes and to provide training so as to ensure that the
Group can meet the requirements fully in 2005. In addition, the
programme is assisting the business units and functions to consider the
wider business impact of the change in reporting in the EU. This work
is advancing to plan. The main risks and uncertainties relate to the
standards that have not yet been finalised and adopted by the EU.
However, the programme is following normal project controls and
change management and we are confident that we will be able to
meet requirements for financial reporting in 2005.
US GAAP
Significant differences exist between accounting principles generally
accepted in the UK and those generally accepted in the US. The effect of
US GAAP on attributable profit and shareholders’ funds of Barclays PLC
is set out in Note 61.
Accounting Presentation
The prior period presentation has, where appropriate, been restated to
conform with current year classification.
Nature of business
Barclays is an international financial services group engaged primarily
in banking, investment banking and asset management. In terms of
assets employed, Barclays is one of the largest financial services groups
in the UK. The Group also operates in many other countries around the
world and is a leading provider of co-ordinated global services to
multinational corporations and financial institutions in the world’s
main financial centres.
Analyses by geographical segments and classes of business
The analyses by geographical segment are generally based on the
location of the office recording the transaction.
Acquisitions
In 2001, the Group increased its shareholding in Banco Barclays SA
(formerly Banco Barclays e Galicia SA) from 50% to over 99%.
The entity has been consolidated as a subsidiary undertaking since
1st January 2001.
In April 2002, Barclaycard acquired the UK Providian credit card
business.
In October 2002, Barclays and Canadian Imperial Bank of Commerce
completed the combination of their retail, corporate and offshore
banking operations in the Caribbean to create FirstCaribbean
International Bank (FirstCaribbean). Barclays interest in the new entity
has been accounted for as an Associated undertaking. The transaction
resulted in a gain for Barclays of £206m (recognised in the Statement of
total recognised gains and losses) consequent on the disposal of a share
of its Caribbean operations. The acquisition of a share of CIBC West
Indies Holding Limited has generated goodwill in Barclays of £131m.
On 31st January 2003, Barclays acquired the retail stockbroking business
Charles Schwab Europe.
On 19th May 2003, Barclays completed the acquisition of Clydesdale
Financial Services Limited and its holding company Carnegie Holdings
Limited, a retailer point of sale finance business.
On 16th July 2003, Barclays completed the acquisition of Banco
Zaragozano, a Spanish private sector banking group.
On 17th December 2003, Barclays acquired Gerrard Management
Services Limited (‘Gerrard’), a private client discretionary and advisory
asset management business.
Disposals
In 2001, the Group disposed of the Greek Branches of the Bank and
Banque Woolwich SA.
In 2002 the Group disposed of a share of the Group’s Caribbean
operation (see detail under Acquisitions above). The effect of the
disposal is reflected in the Statement of recognised gains and losses
on page 121.
In 2003, the Group did not make any significant disposals.