full_annual_report_2014

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180 Vodafone Group Plc Annual Report 2014 Notes to the Company financial statements (continued) 7. Share-based payments Accounting policies The Group operates a number of equity-settled share-based compensation plans for the employees of subsidiaries using the Company’s equity instruments. The fair value of the compensation given in respect of these share-based compensation plans is recognised as a capital contribution to the Company’s subsidiaries over the vesting period. The capital contribution is reduced by any payments received from subsidiaries in respect of these share-based payments. The Company currently uses a number of equity settled share plans to grant options and shares to the directors and employees of its subsidiaries. At 31 March 2014 the Company had 27 million ordinary share options outstanding (2013: 40 million) and no ADS options outstanding (2013: nil). The Company has made a capital contribution to its subsidiaries in relation to share-based payments. At 31 March 2014 the cumulative capital contribution net of payments received from subsidiaries was £131 million (2013: £205 million). During the year ended 31 March 2014 the capital contribution arising from share-based payments was £103 million (2013: £134 million), with payments of £177 million (2013: £246 million) received from subsidiaries. Full details of share-based payments, share option schemes and share plans are disclosed in note 27 “Share-based payments” to the consolidated financial statements. 8. Reserves and reconciliation of movements in equity shareholders’ funds Share Capital Own Profit Total equity Share premium redemption Capital Other shares and loss shareholders’ capital account reserve reserve reserves held account funds £m £m £m £m £m £m £m £m 1 April 2013 3,866 43,087 10,388 88 834 (9,103) 43,231 92,391 Allotment of shares – 2 – – – – – 2 Own shares released on vesting of share awards – – – – – 194 – 194 Profit for the financial year – – – – – – 10,970 10,970 Dividends – – – – – – (40,566) (40,566) Capital contribution given relating to share-based payments – – – – 103 – – 103 Contribution received relating to share-based payments – – – – (177) – – (177) Capital reduction and creation of B and C shares 16,613 (27,008) (10,462) – – – 20,857 – Cancellation of B shares (16,613) – – – – – 1,115 (15,498) Share cancellations (74) – 74 – – 1,648 (1,648) – Other movements – 28 – – (2) (28) (59) (61) 31 March 2014 3,792 16,109 – 88 758 (7,289) 33,900 47,358 The profit for the financial year dealt with in the accounts of the Company is £10,970 million (2013: £7,153 million). Under English law, the amount available for distribution to shareholders is based upon the profit and loss reserve of the Company and is reduced by the amount of own shares held and is limited by statutory or other restrictions. The auditor’s remuneration for the current year in respect of audit and audit-related services was £0.9 million (2013: £0.6 million) and for non-audit services was £3.5 million (2013: £0.1 million). The directors are remunerated by the Company for their services to the Group as a whole. No remuneration was paid to them specifically in respect of their services to Vodafone Group Plc for either year. Full details of the directors’ remuneration are disclosed in “Directors’ remuneration” on pages 69 to 85. There were no employees other than directors of the Company throughout the current or the preceding year.
Overview Strategy review Performance Governance Financials Additional information 181 9. Equity dividends Accounting policies Dividends paid and received are included in the Company financial statements in the period in which the related dividends are actually paid or received or, in respect of the Company’s final dividend for the year, approved by shareholders. 2014 2013 £m £m Declared during the financial year: Final dividend for the year ended 31 March 2013: 6.92 pence per share (2013: 6.47 pence per share) 3,365 3,193 Interim dividend for the year ended 31 March 2014: 3.53 pence per share (2013: 3.27 pence per share) 1,711 1,608 Special dividend for the year ended 31 March 2014: 172.94 US cents per share (2013: nil) 1 35,490 – 40,566 4,801 Proposed after the balance sheet date and not recognised as a liability: Final dividend for the year ended 31 March 2014: 7.47 pence per share (2013: 6.92 pence per share) 1,975 3,377 Note: 1 Refer to note 9 “Equity dividends” in the consolidated financial statements for further information on the Return of Value to shareholders, following the disposal of the US Group whose principal asset was its 45% interest in VZW. 10. Contingent liabilities 2014 2013 £m £m Performance bonds 1 171 174 Other guarantees and contingent liabilities 2,738 1,856 Note: 1 Performance bonds require the Company to make payments to third parties in the event that the Company or its subsidiaries do not perform what is expected of them under the terms of any related contracts. Other guarantees and contingent liabilities Other guarantees principally comprise the Company’s guarantee of the Group’s 50% share of an AUD 1.7 billion loan facility and a US$3.5 billion loan facility of its joint venture, Vodafone Hutchison Australia Pty Limited, and the counter indemnification by the Company of guarantees provided by an indirect subsidiary of the Company to Piramal Healthcare Limited (‘Piramal’) for INR 89.2 billion (£986 million; 2013: £1,080 million). The guarantees to Piramal were made in respect to its acquisition of 10.97% shareholding in Vodafone India Limited (‘VIL’) during the 2013 financial year. On 11 April 2014, the Group acquired the remaining 10.97% of its Indian subsidiary, Vodafone India Limited, from Piramal Enterprises Limited. The Company will guarantee the debts and liabilities of certain of its UK subsidiaries at the balance sheet date in accordance with section 479C of the Companies Act 2006. The Company has assessed the probability of loss under these guarantees as remote. As discussed in note 30 “Contingent liabilities” to the consolidated financial statements the Company has covenanted to provide security in favour of the trustee of the Vodafone Group UK Pension Scheme and the Trustees of the Cable & Wireless Worldwide Retirement Plan and THUS Plc Group Scheme. Legal proceedings Details regarding certain legal actions which involve the Company are set out in note 30 “Contingent liabilities” to the consolidated financial statements.
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