Barclays 2007 Annual Report Download - page 217

3
Financial statements
Barclays PLC Annual Report 2007 215
32 Reserves (continued)
Retained earnings and treasury shares – Barclays PLC Group
Retained Treasury
earnings shares Total
£m £m £m
At 1st January 2007 12,169 (212) 11,957
Profit attributable to equity holders of the parent 4,417 – 4,417
Equity-settled share schemes 567 – 567
Tax on equity-settled share schemes 28 – 28
Net purchases of treasury shares – (572) (572)
Transfer (524) 524 –
Dividends paid (2,079) – (2,079)
Repurchase of shares (1,802) – (1,802)
Transfer from share premium account 7,223 – 7,223
Arising on share issue 941 – 941
Other 30 – 30
At 31st December 2007 20,970 (260) 20,710
At 1st January 2006 8,957 (181) 8,776
Profit attributable to equity holders of the parent 4,571 – 4,571
Equity-settled share schemes 663 – 663
Tax on equity-settled share schemes 96 – 96
Net purchases of treasury shares – (425) (425)
Transfer (394) 394 –
Dividends paid (1,771) – (1,771)
Other 47 – 47
At 31st December 2006 12,169 (212) 11,957
The Treasury shares primarily relate to Barclays PLC shares held by employee benefit trusts in relation to the Executive Share Award Scheme, Performance
Share Plan and Sharepurchase Scheme, to the extent that such shares have not been allocated to employees. These schemes are described in Note 44.
The total number of Barclays shares held in Group employee benefit trusts at 31st December 2007 was 211.4 million (2006: 168 million). Dividend rights
have been waived on nil (2006: nil) of these shares. The total market value of the shares held in trust based on the year-end share price of £5.04 (2006: £7.30)
was £1,065m (2006: £1,227m). As at 31st December 2007, options over 16.6 million (2006: 9.6 million) of the total shares held in the trusts were exercisable.
The Group operates in a number of countries subject to regulations under which a local subsidiary has to maintain a minimum level of capital. The current
policy of the Group is that local capital requirements are met, as far as possible, by the retention of profit. Certain countries operate exchange control
regulations which limit the amount of dividends that can be remitted to non-resident shareholders. It is not possible to determine the amount of profit
retained and other reserves that are restricted by these regulations, but the net profit retained of overseas subsidiaries, associates and joint ventures at
31st December 2007 totalled £7,311m (2006: £5,667m). If such overseas reserves were to be remitted, other tax liabilities, which have not been provided
for in the accounts, might arise.
Retained earnings – Barclays PLC (Parent company)
Capital
Retained redemption
earnings reserve Total
£m £m £m
At 1st January 2007 1,468 309 1,777
Profit after tax 3,289 – 3,289
Dividends paid (2,129) – (2,129)
Transfer from share premium account 7,223 – 7,223
Arising on share issue 941 – 941
Repurchase of shares (1,802) 75 (1,727)
At 31st December 2007 8,990 384 9,374
At 1st January 2006 1,318 309 1,627
Profit after tax 1,964 – 1,964
Dividends paid (1,814) – (1,814)
At 31st December 2006 1,468 309 1,777
Details of principal subsidiaries held through Barclays Bank PLC are shown in Note 40.
The operation of section 131 of the Companies Act 1985 with regard to the issue of shares by Barclays PLC in exchange for shares in Odysseus Jersey
(No 1) Limited and the subsequent redemption of the no par value redeemable preference shares of that company for cash, has resulted in additional
distributable profits of £941m.
On 11th October 2007, the order of the High Court confirming the cancellation of £7,223m of the share premium account was registered with the
Registrar of Companies. This created £7,223m additional distributable reserves in Barclays PLC. The purpose of the cancellation of the share premium
account was to create distributable profits in order to allow the payment of dividends following the completion of the share buy-back programme, the
redemption of the preference shares which were to have been issued in connection with the proposed merger with ABN AMRO, and to provide maximum
flexibility to manage the company’s capital resources.