annual report 2011
annual report 2011
annual report 2011
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IOOF | <strong>annual</strong> <strong>report</strong> <strong>2011</strong><br />
Notes to the financial statements (cont’d)<br />
For the year ended 30 June <strong>2011</strong><br />
7 Operating segments<br />
The Group’s chief operating decision maker is the Group<br />
Managing Director. The strategic business units offer different<br />
products and services, and are managed separately because<br />
they require different technology and marketing strategies.<br />
The principal products and services of each of these strategic<br />
business units are as follows:<br />
Platform management and administration<br />
The provision of administration and management services<br />
through master trust platforms, which offer a single access<br />
point to a range of investment products.<br />
Investment management<br />
The management and investment of monies on behalf of<br />
corporate, superannuation, institutional clients and private<br />
individual investor clients. The investment management<br />
segment includes revenue and results of the Perennial Group.<br />
Financial advice and distribution<br />
The provision of financial planning advice supported by<br />
services such as investment research, training, compliance<br />
support and access to financial products.<br />
Estate and trustee services<br />
The provision of estate planning, trustee, custodial, agency and<br />
estate administration services to clients.<br />
Corporate and other<br />
Corporate and other costs include those of a strategic,<br />
shareholder or governance nature necessarily incurred in<br />
carrying on business as a listed entity managing multiple<br />
business units.<br />
Information regarding the results of each <strong>report</strong>able segment<br />
is included below. Performance is measured based on<br />
segment profit before income tax as management believes<br />
that such information is the most relevant in evaluating the<br />
results of certain segments relative to other entities that<br />
operate within these industries.<br />
Reconciliation of <strong>report</strong>able segment revenues and expenses<br />
Reconciliation of <strong>report</strong>able segment assets and liabilities<br />
Total Total Total Total<br />
<strong>2011</strong> 2010 <strong>2011</strong> 2010<br />
$’000 $’000 $’000 $’000<br />
Revenues<br />
Assets<br />
External management and service fee revenue 551,059 541,567 Reportable segment assets 1,089,746 1,076,273<br />
External other fee revenue 15,498 14,477 Investments backing policyholder liabilities 968,017 1,023,476<br />
Other external revenue 64,845 61,297 2,057,763 2,099,749<br />
Finance income 11,247 9,337<br />
Consolidated revenue 642,649 626,678<br />
Expenses<br />
Liabilities<br />
Service fees and other direct costs 275,597 264,652 Reportable segment liabilities 187,768 190,065<br />
Amortisation of deferred acquisition costs 7,466 8,436 Policy liabilities 968,017 1,022,730<br />
Operating expenditure 204,766 226,337 1,155,785 1,212,795<br />
Share-based payments expense 3,232 2,027<br />
Depreciation and amortisation 21,713 22,845<br />
Consolidated expenses 512,774 524,297<br />
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