BP Annual Report and Form 20-F 2011 - Company Reporting

Parent company financial statements of BP p.l.c.9. Cash flow$ million2011 2010Reconciliation of net cash flow to movement of fundsDecrease in cash (4) (24)Movement of funds (4) (24)Net cash at 1 January 4 28Net cash at 31 December – 4Notes on cash flow statement(a) Reconciliation of operating profit to net cash (outflow) inflow from operating activities 2011 2010Operating profit 11,136 14,514Net operating charge for pensions and other post-retirement benefits, less contributions (117) 2Dividends, interest and other income (12,132) (15,188)Share-based payments 528 549(Increase) decrease in debtors (3,253) 17,405Increase (decrease) in creditors 39 (51)Net cash (outflow) inflow from operating activities (3,799) 17,231$ million(b) Analysis of movements of fundsAt1 January2011CashflowAt31 December2011Cash at bank 4 (4) –10. Contingent liabilitiesThe parent company has issued guarantees under which amounts outstanding at 31 December 2011 were $41,847 million (2010 $36,779 million), ofwhich $40,449 million (2010 $36,747 million) related to guarantees in respect of subsidiary undertakings, including $39,708 million (2010 $36,006 million)in respect of borrowings by its subsidiary undertakings and $30 million (2010 $30 million) in respect of liabilities of other third parties.11. Share-based paymentsEffect of share-based payment transactions on the group’s result and financial position$ million2011 2010Total expense recognized for equity-settled share-based payment transactions 579 577Total expense (credit) recognized for cash-settled share-based payment transactions 5 (1)Total expense recognized for share-based payment transactions 584 576Closing balance of liability for cash-settled share-based payment transactions 12 16Total intrinsic value for vested cash-settled share-based payments 1 1For ease of presentation, options and shares detailed in the tables within this note are stated as UK ordinary share equivalents in US dollars. USemployees are granted American Depositary Shares (ADSs) or options over the company’s ADSs (one ADS is equivalent to six ordinary shares). The mainshare-based payment plans that existed during the year are detailed below.Plans for executive directorsFor further information on the Executive Directors’ Incentive Plan (EDIP) see the Directors’ remuneration report on pages 139 to 151.Plans for senior employeesThe group operates a number of equity-settled share plans under which share units are granted to its senior leaders and certain other employees. Theseplans typically have a three-year performance or restricted period during which the units accrue net notional dividends which are treated as having beenreinvested. Leaving employment will normally preclude the conversion of units into shares, but special arrangements apply for participants that leave forqualifying reasons. Grants are settled in cash where the regulatory environment prohibits participants to hold BP shares.Performance unit plansThe number of units granted is related to the level of seniority of employees. The number of units converted to shares is determined by reference toperformance measures over the three-year performance period. The main performance measure used is BP’s total shareholder return (TSR) compared tothe other oil majors. Plans included in this category are the Competitive Performance Plan (CPP), and, in part, the Performance Share Plan (PSP).Financial statementsThe parent company financial statements of BP p.l.c. on pages PC1 – PC14 do not form part of BP’s Annual Report on Form 20-F as filed with the SEC.BP Annual Report and Form 20-F 2011 PC11