Barclays 2012 Annual Report Download - page 240

1 Significant accounting policies
This section describes Barclays significant accounting policies and critical accounting estimates that relate to the
financial statements and notes as a whole. If an accounting policy or a critical accounting estimate relates to a specific
note, the applicable accounting policy and/or critical accounting estimate is contained within the relevant note.
1. Reporting entity
These financial statements are prepared for Barclays PLC and its subsidiaries (the Barclays PLC Group or the Group) under Section 399 of the
Companies Act 2006. The Group is a major global financial services provider engaged in retail banking, credit cards, wholesale banking,
investment banking, wealth management and investment management services. In addition, individual financial statements have been
presented for the holding company.
2. Compliance with International Financial Reporting Standards
The consolidated financial statements of the Group, and the individual financial statements of Barclays PLC, have been prepared in accordance
with International Financial Reporting Standards (IFRS) and interpretations (IFRICs) issued by the Interpretations Committee, as published by
the International Accounting Standards Board (IASB). They are also in accordance with IFRS and IFRIC interpretations endorsed by the
European Union. The principal accounting policies applied in the preparation of the consolidated and individual financial statements are set out
below, and in the relevant notes to the financial statements. These policies have been consistently applied. There were no changes in
accounting policy in the year.
3. Basis of preparation
The consolidated and individual financial statements have been prepared under the historical cost convention modified to include the fair
valuation of investment property and particular financial instruments to the extent required or permitted under IFRS as set out in the relevant
accounting policies. They are stated in millions of pounds Sterling (£m), the functional currency of Barclays PLC.
4. Accounting policies
Barclays prepares financial statements in accordance with IFRS. The Group’s significant accounting policies relating to specific financial
statement items, together with a description of the accounting estimates and judgements that were critical to preparing them, are set out
under the relevant notes. Accounting policies that affect the financial statements as a whole are set out below.
(i) Consolidation
Barclays applies IAS 27 Consolidated and Separate Financial Statements and SIC 12 Consolidation – Special Purpose Entities (SPEs).
The consolidated financial statements combine the financial statements of Barclays PLC and all its subsidiaries. Subsidiaries are entities over
which it has control of the financial and operating policies through its holdings of voting shares and special purpose entities, which are
consolidated when the substance of the relationship between the Group and the entity indicates control. The control assessment for special
purpose entities includes an assessment of the Group’s exposure to the risks and benefits of the entity.
The consolidation of SPEs is considered at inception, based on the arrangements in place and the assessed risk exposures at that time. The
initial consolidation analysis is revisited at a later date if:
 The Group acquires additional interests in the entity;
 The contractual arrangements of the entity are amended such that the relative exposures to risks and rewards change; and
 The Group acquires control over the main operating and financial decisions of the entity.
There are a number of subsidiaries in which the Group has less than half of the voting rights which are consolidated when the substance of the
relationship between the Group and the entity indicates that the entity is controlled by the Group. Such entities are deemed to be controlled by
the Group when relationships with such entities give rise to benefits that are in substance no different from those that would arise were the
entity a subsidiary.
Intra-group transactions and balances are eliminated on consolidation and consistent accounting policies are used throughout the Group for
the purposes of the consolidation.
Changes in ownership interests in subsidiaries are accounted for as equity transactions if they occur after control has already been obtained
and they do not result in loss of control.
Details of the principal subsidiaries are given in Note 38.
barclays.com/annualreport238 I Barclays PLC Annual Report 2012
Notes to the financial statements
For the year ended 31 December 2012