HSBC 2005 Annual Report Download - page 296

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
294
Interests in joint ventures
At 31 December 2005
Country o
f
Incorporation
Principal
activity
HSBC’s
interest in
equity
capital
Issued
equity
capital
HCM Holdings Limited ............................................... England
Holding
Company 51% £3m
HCM Holdings Limited prepares its financial statements up to 31 December and its principal country of operation is
the United Kingdom. During 2005 HCM Holdings disposed of its trading subsidiary. The remaining investment
represents an interest in a holding company.
Although HSBC owns more than 50 per cent of the equity capital of HCM Holdings Limited, the agreement with the
other shareholder means that there are severe long-term restrictions which substantially hinder HSBC’s rights over
the assets and management of the entity. HSBC does however continue to exercise significant influence and together
with the other shareholder controls the entity.
Summarised aggregate financial information on joint ventures
2005 2004
US$m US$m
HSBC’s share of:
– current assets ........................................................................................................................... 95 38
– non-current assets .................................................................................................................... 55 126
– current liabilities ..................................................................................................................... 34 29
– non-current liabilities .............................................................................................................. 107 131
– income ..................................................................................................................................... 108 6
– expenses .................................................................................................................................. 20 8
21 Goodwill and intangible assets
Goodwill and intangible assets includes goodwill arising on business combinations, the present value of in-force
long-term insurance business, and other intangible assets.
Goodwill
Europe Hong Kong
Rest of Asia-
Pacific
North
America
South
America Total
US$m US$m US$m US$m US$m US$m
Cost
At 1 January 2005 ..................................... 15,873 120 284 13,490 595 30,362
Additions ................................................... 108 1 4 547 – 660
Disposals ................................................... (70) – – (3) – (73)
Exchange differences ................................ (2,137) (1) (17) 428 85 (1,642)
Other changes ............................................ 3 – (1) (22) (62) (82)
At 31 December 2005 ............................... 13,777 120 270 14,440 618 29,225
The addition to goodwill in North America related principally to the acquisition of Metris Companies Inc. on
1 December 2005.