Experian 2007 Annual Report Download - page 84

Introduction | Business review | Governance | Financial statements
Notes to the Group financial statements
for the year ended 31 March 2007
82 |Experian Annual Report2007
6. Employee benefit costs and employee numbers (continued)
(c) Remuneration of key management personnel:
2007 2006
US$m US$m
Salaries and short-term employee benefits 16 13
Retirement benefits 42
Other long-term benefits –2
Share-based payments 28 11
Total continuing operations 48 28
Key management personnel comprises the board of directors, shown on pages 38 and 39, and certain senior management. The amount included in
respect of share-based payments includes operating and exceptional costs for previous GUS awards and the one–off demerger awards.
Further details of the remuneration of directors are given in the auditable part of the report on directors’ remuneration on pages 52 to 57.
Information on transactions with related parties is set out in note 35.
7. Exceptional and other non-GAAP measures
2007 2006
US$m US$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 (note 8) 35 2
Total other non-GAAP measures 149 68
Exceptional items
Other costs of US$126m (2006: US$7m) incurred relating to the demerger of Experian and Home Retail Group comprise legal and professional fees
in respect of the transaction, together with costs in connection with the cessation of the corporate functions of GUS plc in 2007.
In April 2006, Experian announced the phased withdrawal from large scale credit card and loan account processing in the UK. The full cost of
withdrawal of US$26m has been charged in the year, and is made up of a cost in cash of US$28m less the benefit of a US$2m pension curtailment
credit. The loss on the disposal of businesses primarily related to the sale of a minority stake in Experian’s South African business.
First American Real Estate Solutions LLC (‘FARES’) recognised a gain of US$77m on the partial disposal of its Real Estate Solutions division as part of
the consideration for the acquisition of 82% of CoreLogic Solutions, Inc. Experian recognised US$15m, its 20% share of the gain. A deferred tax
charge of US$6m has been included in the FARES result in respect of this gain.
Other non-GAAP measures
IFRS requires that, on acquisition, specific intangible assets areidentified 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 US$14m arose under IFRS3 ‘Business combinations’ on the recognition of previously unrecognised tax losses on prior
years’ acquisitions. The corresponding tax benefit reduces the tax charge in the year by US$14m.
Charges in respect of the demerger-related equity incentive plans relate to one-off grants made to senior management and at all staff levels at the
time of the 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 flotation 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 credited or charged to financing fair value remeasurements within Finance income and Finance expense in the Group income statement.