Annual Report & Accounts 2009 - Anglo Irish Bank

Business review continued
resulted in significant professional fees for valuations and
due diligence. Professional fees have also been incurred as
external consultants have been employed to assist the Bank’s
restructuring process, as well as obtaining legal counsel for
investigations and reviews into the legacy issues and payment
of related expenses to the Financial Regulator. A provision of
€4 million was charged for onerous lease contracts. This is in
relation to offices that are no longer occupied by the Bank
and where the future economic benefits associated with the
lease are less than the future obligations.
Taxation
The taxation credit of €120 million within the income
statement includes a tax credit of €91 million as a result of
the carry back of losses against taxable profits in the prior
year. In addition, the Bank has recognised a deferred tax credit
within the income statement relating to the ability to utilise
losses in the current year against future taxable profits at
subsidiary level. The decrease in the deferred tax asset from
31 March 2009 is due to the release of the asset which was
created in the period to 31 March 2009 in the expectation of
future taxable profits on the liability management exercise.
Risks and uncertainties
The Group is subject to a variety of risks and uncertainties
in the normal course of its business activities. The principal
risks and uncertainties facing the Bank at present are those
related to general economic conditions, NAMA, restructuring,
liquidity risk, credit risk, operational risk, capital and regulatory
compliance, market risk and litigation risk. The potential
impact of these risks is mitigated by the Government’s explicit
ongoing support for the Bank. More detail is contained in the
Principal risks and uncertainties statement on pages 23 to 26.
18
Subsequent events and likely future
developments
The key events that have occurred since the end of the period
are reviewed in note 58 to the Annual Report. The Group Chief
Executive’s review and the Chairman’s statement review the
outlook and likely future development of the Group.
1 Gross of impairment provisions and including lending associated
with the Group’s assurance company
2On a constant currency basis