BROADENING OUR HORIZONS - Arrium

OneSteel Annual Report 201121. Retained earnings100CONSOLIDATEDAt the beginning of the year 700.4 561.5Net profit 230.3 258.4Dividends paid (Note 23) (160.0) (119.5)At the end of the year 770.7 700.422. Reserves2011$m2010$mCONSOLIDATEDForeign currency translation reserve (104.2) (29.5)Cash flow hedge reserve 2.9 0.4Share-based payments reserve 13.0 8.3Asset revaluation reserve 1.8 1.82011$m2010$m(86.5) (19.0)(a) Foreign currency translation reserveAt the beginning of the year (29.5) (22.0)Net investment hedges 16.6 5.3Exchange fluctuations on overseas net assets (91.3) (12.8)At the end of the year (104.2) (29.5)(b) Cash flow hedge reserveAt the beginning of the year 0.4 (5.5)Gains/(losses) taken to Equity 3.5 (6.6)Transferred to finance costs (5.4) 12.3Transferred to initial carrying amount of hedged items on Balance Sheet 4.4 0.2At the end of the year 2.9 0.4(c) Share-based payments reserveAt the beginning of the year 8.3 4.2Expense recognised 4.7 4.7Transferred from employee compensation shares (Note 20) — (0.6)At the end of the year 13.0 8.3(d) Asset revaluation reserveAt the beginning of the year 1.8 1.8At the end of the year 1.8 1.8Nature and purpose of reservesForeign currency translation reserveThe foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements offoreign subsidiaries and the effective portion of the gain or loss on net investment hedges.Cash flow hedge reserveThe cash flow hedge reserve is used to record the effective portion of the gain or loss on hedge instruments and the underlying hedgeditem in designated cash flow hedges relationships.Share-based payments reserveThe share-based payments reserve is used to record the value of equity-based compensation provided to employees and seniorexecutives as part of their remuneration. Refer to Note 29 for further details of these plans.Asset revaluation reserveThe asset revaluation reserve relates to the revaluation of the pre-acquisition carrying amounts of intangible assets acquired throughbusiness combinations, to their fair values.