Barclays 2015 Annual Report Download - page 269

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8 Operating expenses
Accounting for staff costs
The Group applies IAS 19 Employee benefits in its accounting for most of the components of staff costs.
Short-term employee benefits – salaries, accrued performance costs and social security are recognised over the period in which the employees
provide the services to which the payments relate.
Performance costs – recognised to the extent that the Group has a present obligation to its employees that can be measured reliably and are
recognised over the period of service that employees are required to work to qualify for the services.
Deferred cash bonus awards and deferred share bonus awards are made to employees to incentivise performance over the vesting period. To
receive payment under an award, employees must provide service over the vesting period, typically three years from the grant date. The period
over which the expense for deferred cash and share bonus awards is recognised is based upon the common understanding between the
employee and the Group and the terms and conditions of the award. The Group considers that it is appropriate to recognise the awards over the
period from the date of grant to the date that the awards vest as this is the period over which the employees understand that they must provide
service in order to receive awards. The table on page 91 details the relevant award dates, payment dates and the period in which the income
statement charge arises for bonuses. No expense has been recognised in 2015 for the deferred bonuses that will be granted in March 2016, as
they are dependent upon future performance rather than performance during 2015.
The accounting policies for share based payments, and pensions and other post retirement benefits are included in Note 34 and Note 35
respectively.
2015
£m
2014
£m
2013
£m
Infrastructure costs
Property and equipment 1,353 1,570 1,610
Depreciation of property, plant and equipment 554 585 647
Operating lease rentals 500 594 645
Amortisation of intangible assets 617 522 480
Impairment of property, equipment and intangible assets 153 172 149
Gain on property disposals 3 – –
Total infrastructure costs 3,180 3,443 3,531
Administration and general costs
Consultancy, legal and professional fees 1,191 1,104 1,253
Subscriptions, publications, stationery and communications 760 842 869
Marketing, advertising and sponsorship 536 558 583
Travel and accommodation 218 213 307
UK bank levy 476 462 504
Goodwill impairment 102 – 79
Other administration and general expenses 245 442 518
Total administration and general costs 3,528 3,621 4,113
Recurring staff cost 10,389 11,005 12,155
Gains on retirement benefits (429) – –
Staff costs 9,960 11,005 12,155
Provision for UK customer redress 2,772 1,110 2,000
Provision for ongoing investigations and litigation including Foreign Exchange 1,237 1,250 173
Operating expenses 20,677 20,429 21,972
For information on staff costs, refer to pages 90 and 91 of the Remuneration Report.
2015
Operating expenses have increased by 1% to £20,677m (2014: £20,429m) attributable to an increase in provisions for UK customer redress
including PPI and an increase in impairment of goodwill partially offset by a decrease in staff costs (includes a gain on Retirement benefits, refer to
Note 35 of £429m) and infrastructure costs reflecting savings from strategic cost programmes.
2014
Operating expenses have reduced by 7% to £20,429m, primarily driven by savings from strategic cost programmes, including a 5% reduction in
headcount and currency movements, lower provisions for UK customer redress including PPI, reduced IT and infrastructure spend and non-
occurrence of various provisions raised last year. This was partially offset by the charge of £1,250m (2013: £173m) for ongoing investigations and
litigation relating to Foreign Exchange.
The impact of strategic cost programmes have driven savings across infrastructure and administration costs. Staff costs have decreased by 9% to
£11,005m, reflecting a 5% net reduction in headcount and reductions in incentive awards granted.
9 Profit/(loss) on disposal of subsidiaries, associates and joint ventures
During the year, the loss on disposal of subsidiaries, associates and joint ventures was £637m (2014: loss of £471m; 2013: gain of £6m), principally
relating to the sale of Spanish, Portuguese and Italian businesses. Please refer to Note 44 Non-current assets held for sale and associated liabilities.
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