What Does this British Balance Sheet Mean?
Jonathan Atwood, a student from England, shows you the following balance sheet from his father’s British company. Jonathan knows that you are studying accounting and asks you to look at the statement. You immediately recognize some differences between this statement and the ones you have been studying in your textbook.
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Group 31 December |
Company 31 December |
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2008 |
2007 |
2008 |
2007 |
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NOTES |
£m |
£m |
£m |
£m |
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Fixed Assets |
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_____ |
_____ |
_____ |
_____ |
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Intangibles |
13 |
304.0 |
307.4 |
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Tangible assets |
14 |
978.8 |
822.5 |
16.8 |
16.2 |
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Investments |
15 |
16.7 |
25.2 |
938.9 |
679.3 |
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1,299.5 |
1,155.1 |
955.7 |
695.5 |
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Current Assets |
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Stock |
16 |
328.2 |
334.8 |
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Debtors |
17 |
554.1 |
548.2 |
113.4 |
210.8 |
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Investments short term loans |
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and deposits |
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118.0 |
33.3 |
5.1 |
23.5 |
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Cash at bank and in hand |
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62.6 |
57.4 |
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1,062.9 |
973.7 |
118.5 |
234.3 |
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Creditors: amounts falling due within one year |
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Borrowings |
18 |
(136.3) |
(133.7) |
(175.0) |
(74.6) |
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Other |
19 |
(825.9) |
(809.2) |
(98.4) |
(234.7) |
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Net current assets (liabilities) |
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100.7 |
30.8 |
(154.9) |
(75.0) |
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Total assets less current liabilities |
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1,400.2 |
1,185.9 |
800.8 |
620.5 |
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Other Liabilities |
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Creditors: amounts falling due after more than one year |
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Borrowings |
18 |
(407.9) |
(381.4) |
(54.2) |
(80.4) |
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Other |
19 |
(12.0) |
(8.5) |
(26.4) |
(42.1) |
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Provisions for liabilities and charges |
20 |
(96.4) |
(115.5) |
0.5 |
1.2 |
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(516.3) |
(505.4) |
(80.1) |
(121.3) |
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883.9 |
680.5 |
720.7 |
499.2 |
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Capital and Reserves |
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Called up share capital |
21 |
174.7 |
173.6 |
174.7 |
173.6 |
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Share premium account |
22 |
381.6 |
217.4 |
381.6 |
217.4 |
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Revaluation reserve |
22 |
95.8 |
36.7 |
2.4 |
1.1 |
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Profit and loss account |
22 |
115.8 |
167.6 |
162.0 |
107.1 |
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767.9 |
595.3 |
720.7 |
499.2 |
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Minority interests |
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116.0 |
85.2 |
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883.9 |
680.5 |
720.7 |
499.2 |
1. Identify the differences that exist between this British statement and those prepared using the standards and conventions of the United States.
2. Evaluate the differences, identifying strengths and weaknesses of each nation’s approach.