Barclays 2006 Annual Report Download - page 278

Notes to the accounts
For the year ended 31st December 2006
Barclays PLC
Annual Report 2006
274
60 Differences between IFRS and US GAAP accounting principles (continued)
(p) Total assets
Netting
Differences between the netting requirements of IFRS and US GAAP (FIN 39) result in a net reduction in total assets reported for US purposes of
£70,755m (2005: £77,598m).
2006 2005
£m £m
Derivatives (96,858) (96,963)
Securities (5,858) (2,491)
Receivables and payables in respect of unsettled trades (8,224) (8,292)
Loans and deposits 8,559 9,567
Non-cash collateral on stock lending 31,626 20,581
Total (70,755) (77,598)
The inclusion of acceptances resulted in an increase in total assets under US GAAP of £256m (2005: £253m).
The 2005 comparative amounts for derivatives reflect changes to the netting process made in 2006.
(q) Segmental reporting
Barclaycard management include the results of Absa Card within internally reported segment information. On this basis, Absa Card would be
reported within Barclaycard under SFAS 131. Barclaycard’s profit before tax would increase by £68m (2005: £26m, 2004: £nil) on an IFRS basis with
IRCB – Absa profit before tax decreasing by the same amount.
(r) Income statement
There are include differences in the presentation of the income statement between IFRS and US GAAP. Under US GAAP, net interest expense
(2006: £605m, 2005: £126m, 2004: £219m) relating to trading activities would be shown within net interest income, rather than included in net
trading income.
61 Regulatory capital requirements
Capital adequacy and the use of regulatory capital are monitored by the Group, employing techniques based on the guidelines developed by the
Basel Committee on Banking Supervision (the Basel Committee) and European Community directives, as implemented by the FSA for supervisory
purposes. The FSA regards the risk asset ratio calculation, originally developed by the Basel Committee, as a key supervisory tool and sets individual
minimum ratio requirements for banks in the UK at or above the minimum of 8%. The concept of risk weighting and the basis for calculating eligible
capital resources are described under capital ratios on page 59.
The following tables summarises capital resources and capital ratios, as defined for supervisory purposes:
Barclays PLC Group
Amount Ratio
£m %
As at 31st December 2006
Total net capital resources 34,711 11.7
Tier 1 capital resources 23,005 7.7
As at 31st December 2005
Total net capital resources 30,502 11.3
Tier 1 capital resources 18,895 7.0
In addition to the regulatory capital requirements arising from the Group’s banking businesses, the Group has a capital resource requirement of
£225m (2005: £189m) arising from its life assurance businesses. The equity of the life businesses on the same date was £726m (2005: £417m) and
the capital resources available to the Group as a whole amounted to £41,176m (2005: £36,893m).