Annual Report & Accounts 2009 - Anglo Irish Bank

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Notes to the financial statements continued 1. General information and accounting policies continued 1.33 Significant accounting estimates and judgements continued Taxation The taxation charge accounts for amounts due to fiscal authorities in the various jurisdictions in which the Group operates and includes estimates based on a judgement of future profits and the application of law and practice in certain cases in order to determine the quantification of any liabilities arising. In arriving at such estimates, management assesses the relative merits and risks of tax treatments assumed, taking into account statutory, judicial and regulatory guidance and, where appropriate, external advice. Where the final tax outcome is different from the amounts that are currently recorded, such differences will impact upon the current and deferred tax amounts in the period in which such determination is made. Retirement benefits The Group operates defined benefit pension schemes. The Group’s two schemes have been closed to new members since January 1994. In determining the actual pension cost, the values of the assets and liabilities of the schemes are calculated. The assets of the schemes are valued at fair value. The liabilities of the schemes are measured on an actuarial basis, using the projected unit method and discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liabilities. This involves modelling the future growth of scheme liabilities and requires management to make assumptions as to price inflation, dividend growth, salary and pensions increases, return on investments and employee mortality. There are acceptable ranges in which these estimates can reasonably fall. The impact on the Consolidated income statement and the Consolidated statement of financial position could be materially different if an alternative set of assumptions was used. 1.34 Prospective accounting changes Details of amendments to standards and interpretations adopted during the period are set out in note 1.3. The Group has not applied the following new standards, amendments to standards and interpretations that have been approved by the International Accounting Standards Board and which would be applicable to the Group with an effective date after the date of these financial statements. The following will be applied in 2010: � Amendments to IFRS 2 - Share-based Payment; � IFRS 3 Revised - Business Combinations; � Amendments to IFRS 5 - Non-Current Assets Held for Sale and Discontinued Operations; � Amendment to IFRS 7 - Financial Instruments: Disclosures; � IFRS 8 - Operating Segments; � Further amendments to IAS 1 - Presentation of Financial Statements; � Amendment to IAS 7 - Statement of Cash Flows; � Amendment to IAS 16 - Property, Plant and Equipment; � Amendment to IAS 17 - Leases; � Amendment to IAS 19 - Employee Benefits; � Amendment to IAS 20 - Government Grants and Disclosure of Government Assistance; � Amendments to IAS 23 - Borrowing Costs; � Amendments to IAS 27 - Consolidated and Separate Financial Statements; � Amendments to IAS 28 - Investments in Associates; � Amendments to IAS 31 - Interest in Joint Ventures; � Amendments to IAS 36 - Impairment of Assets; � Amendments to IAS 38 - Intangible Assets; � Amendments to IAS 39 - Financial Instruments: Recognition and Measurement – Eligible Hedged Items; � Amendment to IAS 40 - Investment Property; and � IFRIC Interpretation 17 - Distributions of Non-cash Assets to Owners. The following will be applied in 2011: � Amendment to IAS 24 - Related Party Disclosures; � Amendments to IAS 32 - Financial Instruments: Presentation; � Amendment to IFRIC Interpretation 14 - IAS 19 - The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction; and � IFRIC Interpretation 19 - Extinguishing Financial Liabilities with Equity Instruments. The following will be applied in 2013: � IFRS 9 - Financial Instruments: Classification and Measurement. These will be adopted in future years and, with the exception of IFRS 9 and the amendments to IFRS 7 and IAS 24, are not expected to have a material impact on the Bank's results or financial statements. IFRS 9 will ultimately replace IAS 39 - Financial Instruments: Recognition and Measurement. Its aim is to reduce the complexity of accounting for financial assets and in so doing to aid investors’ and other users’ understanding of financial information. IFRS 9 uses a single approach to determine whether a financial asset is measured at amortised cost or fair value, replacing the many different rules in IAS 39. It also requires a single impairment method to be used which replaces the various methods currently prescribed in IAS 39. The amendment to IFRS 7 requires the use of a three-level fair value hierarchy to provide additional disclosures about the relative reliability of measurement bases used to calculate financial instrument fair values. In addition, the amendment requires enhanced disclosures in respect of liquidity risk. The amendment to IAS 24 simplifies the disclosure requirements for Government-related entities and clarifies the definition of a related party. 58
2. Segmental reporting Business segments Inter- Business Private Group segment Lending Treasury Banking items eliminations Group €m €m €m €m €m €m Revenue from external customers 3,777 482 113 1,653 - 6,025 Inter-segment revenue - 1,918 - - (1,918) - Total revenue 3,777 2,400 113 1,653 (1,918) 6,025 Operating loss (12,370) (1,465) (440) 1,564 - (12,711) Share of results of associate and joint ventures Profit on disposal of Anglo Irish - - (167) - - (167) Bank (Austria) A.G. - - 49 - - 49 Loss before taxation (12,370) (1,465) (558) 1,564 - (12,829) External assets 55,440 18,069 3,211 8,492 - 85,212 Inter-segment assets 753 59,301 - - (60,054) - Total assets 56,193 77,370 3,211 8,492 (60,054) 85,212 External liabilities 83 77,370 1,106 2,483 - 81,042 Equity - - - 4,170 - 4,170 Inter-segment liabilities 56,110 - 2,105 1,839 (60,054) - Total equity and liabilities 56,193 77,370 3,211 8,492 (60,054) 85,212 Additional information: Capital expenditure 7 3 - 7 - 17 Depreciation and amortisation 18 5 3 9 - 35 Provisions for impairment 14,194 471 440 - - 15,105 Other non-cash expenses 10 5 2 5 - 22 Interests in joint ventures - - 142 - - 142 Geographical segments 15 months ended 31 December 2009 Anglo Irish Bank Annual Report & Accounts 2009 15 months ended 31 December 2009 Republic UK Rest of the of Ireland & IOM USA World Group €m €m €m €m €m Revenue from external customers 3,315 2,328 369 13 6,025 Total external assets 58,102 17,368 9,699 43 85,212 Capital expenditure 14 3 - - 17 59
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Annual Report & Accounts 2009
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Contents Page Chairman’s statemen
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Legacy matters The Bank is continui
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Jim Brydie was appointed Head of Gr
Page 9 and 10: Business review This business revie
Page 11 and 12: Divisional lending balances by sect
Page 13 and 14: holdings, reduced investment cash f
Page 15 and 16: 30 September 2008. Average total cu
Page 17 and 18: Income statement - treasury impairm
Page 19 and 20: to acquire these assets they are in
Page 21 and 22: Board of Directors Donal O’Connor
Page 23 and 24: In keeping with our environmental p
Page 25 and 26: Principal risks and uncertainties T
Page 27 and 28: Credit risk Credit risk is the risk
Page 30 and 31: Report of the Directors The Directo
Page 32 and 33: Corporate governance statement On 1
Page 34 and 35: Corporate governance statement cont
Page 36 and 37: Independent Auditors' report to the
Page 38 and 39: Consolidated income statement For t
Page 40 and 41: Consolidated statement of financial
Page 42 and 43: Consolidated statement of changes i
Page 44 and 45: Statement of cash flows For the 15
Page 46 and 47: Notes to the financial statements I
Page 48 and 49: Notes to the financial statements c
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Notes to the financial statements c
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Supplementary information Consolida
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www.angloirishbank.com Anglo Irish
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Annual Report & Accounts 2009 - Anglo Irish Bank

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