Experian 2007 Annual Report Download - page 34

32 |Experian Annual Report 2007
Financial review cont.
Exceptional items
The only costs treated as exceptional items are those
associated with the disposal, demerger or closure of
businesses. All other restructuring costs have been
charged against EBIT in the divisions in which they were
incurred.
The exceptional items during the year were costs incurred
relating to the demerger of Experian and Home Retail
Group, the charge on early vesting and modification of
share awards at demerger, costs incurred in the closure
of UK Account Processing and a gain arising in an
associate from partial disposal of its subsidiary.
Other adjustment items
IFRS requires that, on acquisition, specific intangible
assets are identified and recognised separately from
goodwill and then amortised over their useful economic
lives. These include items such as brand names and
customer lists, to which value is first attributed at the time
of acquisition. The Group has excluded amortisation of
these acquisition intangibles from its definition of
Benchmark PBT because such a charge is based on
uncertain judgements about their value and economic life.
A goodwill adjustment of $14m arose in accordance with
IFRS 3 ‘Business Combinations’ following the recognition
of a benefit in respect of previously unrecognised tax
losses relating to prior year acquisitions. The
corresponding tax benefit reduces the tax charge in
the year by $14m.
Charges in respect of demerger-related equity incentive
plans relate to one-off grants made to senior
management and all other staff levels at the time of
demerger under a number of equity incentive plans. The
cost of these one-off grants will be charged to the Group
income statement over the five years following the
demerger, but excluded from the definition of
Benchmark PBT. The cost of all other grants will be
charged to the Group income statement and will be
included in the definition of Benchmark PBT.
An element of the Group’s derivatives is ineligible for
hedge accounting under IFRS. Gains or losses on these
derivatives arising from market movements are charged
or credited to the income statement. In the year to
31 March 2007 this amounted to a charge of
$35m (2006: $2m).
Pensions
Note 24 to the financial statements shows the
assumptions used (including mortality assumptions)
together with the other disclosures required in
accordance with IAS 19.
At 31 March 2007 the Group has a net surplus for all
retirement benefit schemes on an IAS 19 basis of
$85m (2006: $31m).
Accounting policies and standards
The principal accounting policies used by the Group are
shown in note 2 to the financial statements.
Introduction | Business review | Governance | Financial statements
Exceptional items and other non-GAAP measures
2007 2006
$m $m
Exceptional items
Continuing operations:
Charge on early vesting and modification of share awards at demerger
of Experian and Home Retail Group 23 -
Other costs incurred relating to the demerger of Experian and Home Retail Group 126 7
Costs incurred in the closure of UK Account Processing 26 -
Loss on disposal of businesses 2 -
Gain arising in associate on the partial disposal of its subsidiary (15) -
Total exceptional items 162 7
Other non-GAAP measures
Continuing operations:
Amortisation of acquisition intangibles 76 66
Goodwill adjustment 14 -
Charges in respect of the demerger-related equity incentive plans 24 -
Financing fair value remeasurements 35 2
Total other non-GAAP measures 149 68