Consolidated profit and loss account - Stagecoach Group

Notes to the accounts 2003
Note 20 Hedge accounting 2003 2002
Gains Losses Total Gains Losses Total
»m »m »m »m »m »m
Unrecognised gains or losses on hedges at
start of year 35.5 (31.5) 4.0 26.5 (81.0) (54.5)
Gains or losses arising in previous years that were
recognised in the year 22.3 0.3 22.6 7.6 55.4 63.0
Gains or losses arising in previous years that were
not recognised in the year 57.8 (31.2) 26.6 34.1 (25.6) 8.5
Gains or losses arising in the year that were
not recognised in the year 1.2 (2.3) (1.1) 1.4 (5.9) (4.5)
Unrecognised gains or losses on hedges at end of year 59.0 (33.5) 25.5 35.5 (31.5) 4.0
Of which:
Gains or losses expected to be recognised within
one year 19.4 (16.9) 2.5 11.1 (13.5) (2.4)
Gains or losses expected to be recognised after
one year 39.6 (16.6) 23.0 24.4 (18.0) 6.4
59.0 (33.5) 25.5 35.5 (31.5) 4.0
As explained in the Finance Director’s review on pages 19 to 21, the Group’s policy is to hedge against interest rate risk, currency risk and
commodity price risk.
Gains and losses on instruments used for hedging are not recognised until the exposure that is being hedged is itself recognised.
Note 21 Provisions for liabilities and charges Group Company
2003 2002 2003 2002
»m »m »m »m
Deferred taxation 104.8 105.3 Nil 3.6
Token redemption provision 26.4 25.5 Nil Nil
Insurance provisions 80.2 65.2 Nil Nil
Environmental provisions 2.4 2.9 0.8 1.2
Pension provision (note 26d) 11.8 6.1 2.8 3.2
Restructuring provision 4.6 1.7 Nil Nil
230.2 206.7 3.6 8.0
Joint ventures
^ share of gross assets (5.3) (5.1) Nil Nil
^ share of gross liabilities 27.9 21.8 Nil Nil
22.6 16.7 Nil Nil
Total provisions 252.8 223.4 3.6 8.0
The token redemption provision relates to tokens issued to third parties to be redeemed as payment for transportation services.
The insurance provisions relate to insurance reserves on incurred accidents up to 30 April in each year where claims have not been settled.
These are based on actuarial reviews and prior claims history.
The environmental provisions relate to legal or constructive obligations to undertake environmental work, such as an obligation to rectify
land which has been contaminated by fuel tanks or to eliminate the presence of asbestos. The provision is based on the estimated cost of
undertaking the work required.
The pension provision relates to unfunded liabilities established by actuarial review and SSAP 24 pension liabilities.
The restructuring provision relates to the estimated costs of completing the sale or closure of operations at Coach USA, where an
obligation exists at the balance sheet date.
Share of joint venture’s net liabilities relates to the Group’s interest in the consolidated net liabilities of Trainline Holdings Limited.
64