REG - Legal & General Grp - L&G Half-year results 2015 Part 2 <Origin Href="QuoteRef">LGEN.L</Origin> - Part 6
05/08/2015 07:01
- Part 6: For the preceding part double click ID:nRSE1056Ve
backed securities Cash flows; expected defaults 4 - -
- Untraded and other debt securities Cash flows; expected defaults 2 - -
- Unquoted and other securities Cash flows; expected defaults 196 22 (22)
- Investment property2 Property yield; occupancy 5,502 276 (276)
Total 10,932 558 (558)
1. Private equity investments are valued in accordance
with the International Private Equity and Venture
Capital Valuation Guidelines. Reasonably possible
alternative valuations have been determined using
alternative price earnings multiples.
2. Unquoted investments in property vehicles and direct
holdings in investment property are valued by
independent valuers on the basis of open market value as
defined in the appraisal and valuation manual of the
Royal Institute of Chartered Surveyors. Reasonably
possible alternative valuations have been determined
using alternative yield and occupancy assumptions.
IFRS and Cash
50
2.15 Financial investments and Investment property (continued)
(c) Effect on changes in significant unobservable inputs to reasonably possible alternative assumptions on level 3 assets (continued)
Reasonably possible
alternative assumptions
Current Increase Decrease
fair in fair in fair
For the six months ended 30 June 2014 Main value value value
Financial instruments and investment property assumptions £m £m £m
Assets
Shareholder
- Unquoted investments in property vehicles2 Property yield; occupancy 153 16 (16)
- Untraded and other debt securities Cash flows; expected defaults 167 8 (8)
- Investment property2 Property yield; occupancy 328 16 (16)
Non profit non-linked
- Untraded and other debt securities Cash flows; expected defaults 879 29 (29)
- Investment property2 Property yield; occupancy 1,692 85 (85)
With-profits
- Private equity investment vehicles1 Price earnings multiple 170 9 (9)
- Unquoted investments in property vehicles2 Property yield; occupancy 366 19 (19)
- Investment property2 Property yield; occupancy 961 48 (48)
Unit linked
- Unquoted investments in property vehicles2 Property yield; occupancy 321 23 (23)
- Suspended securities Estimated recoverable amount 6 1 (1)
- Asset backed securities Cash flows; expected defaults 3 - -
- Investment property2 Property yield; occupancy 4,371 210 (210)
Total 9,417 464 (464)
1. Private equity investments are valued in accordance with the International Private Equity and Venture Capital Valuation Guidelines. Reasonably possible alternative valuations have been determined using alternative price earnings multiples.
2. Unquoted investments in property vehicles and direct holdings in investment property are valued by independent valuers on the basis of open market value as defined in the appraisal and valuation manual of the Royal Institute of Chartered Surveyors. Reasonably possible alternative valuations have been determined using alternative yield and occupancy assumptions.
IFRS and Cash
51
2.15 Financial investments and Investment property (continued)
(c) Effect on changes in significant unobservable inputs to reasonably possible alternative assumptions on level 3 assets (continued)
Reasonably possible
alternative assumptions
Current Increase Decrease
fair in fair in fair
For the year ended 31 December 2014 Main value value value
Financial instruments and investment property assumptions £m £m £m
Assets
Shareholder
- Private equity investment vehicles1 Price earnings multiple 16 1 (1)
- Unquoted investments in property vehicles2 Property yield; occupancy 117 7 (7)
- Untraded and other debt securities Cash flows; expected defaults 241 12 (12)
- Unquoted and other securities Cash flows; expected defaults 94 2 (2)
- Investment property2 Property yield; occupancy 151 8 (8)
Non profit non-linked
- Asset backed securities Cash flows; expected defaults 497 25 (25)
- Untraded and other debt securities Cash flows; expected defaults 281 14 (14)
- Unquoted and other securities Cash flows; expected defaults 173 6 (6)
- Other 39 - -
- Investment property2 Property yield; occupancy 1,879 94 (94)
With-profits
- Private equity investment vehicles1 Price earnings multiple 160 9 (9)
- Unquoted and other securities2 Cash flows; expected defaults 375 18 (18)
- Other 3 - -
- Investment property2 Property yield; occupancy 1,034 52 (52)
Unit linked
- Suspended securities Estimated recoverable amount 7 - -
- Asset backed securities Cash flows; expected defaults 7 4 (4)
- Untraded and other debt securities Cash flows; expected defaults 2 - -
- Unquoted and other securities Cash flows; expected defaults 373 15 (15)
- Investment property2 Property yield; occupancy 5,088 255 (255)
Total 10,537 522 (522)
1. Private equity investments are valued in accordance with the International Private Equity and Venture Capital Valuation Guidelines. Reasonably possible alternative valuations have been determined using alternative price earnings multiples.
2. Unquoted investments in property vehicles and direct holdings in investment property are valued by independent valuers on the basis of open market value as defined in the appraisal and valuation manual of the Royal Institute of Chartered Surveyors. Reasonably possible alternative valuations have been determined using alternative yield and occupancy assumptions.
IFRS and Cash
52
2.16 Tax
(a) Tax charge in the Consolidated Income Statement
The tax attributable to equity holders differs from the tax calculated at the standard UK corporation tax rate as follows:
Full year
30.06.15 30.06.14 31.12.14
£m £m £m
Profit before tax attributable to equity holders 672 636 1,238
Tax calculated at 20.25% (2014: 21.5%) 136 137 266
Effects of:
Adjustments in respect of prior years - 1 8
Income not subject to tax, such as dividends (3) (2) (9)
Change in valuation of tax losses - (17) (6)
Higher rate of tax on profits taxed overseas 10 15 8
Additional allowances/non-deductible expenses (4) (3) (7)
Impact of reduction in UK corporate tax rate on deferred tax balances1 - 1 -
Differences between taxable and accounting investment gains (11) (1) (15)
Other (3) (2) 1
Tax attributable to equity holders 125 129 246
Equity holders' effective tax rate2 18.6% 20.3% 19.9%
1. The impact of the further corporation tax reductions announced on 8 July 2015 has not been included in the half year 2015 results as required under IAS 12. The impact will be included in the FY 15 results.2. Equity holders' effective tax rate is calculated by dividing the tax attributable to equity holders over profit before tax attributable to equity holders.
IFRS and Cash
53
2.16 Tax (continued)
(b) Deferred Tax
Full year
30.06.15 30.06.14 31.12.14
(i) UK deferred tax (liabilities)/assets £m £m £m
Realised and unrealised gains on investments (256) (154) (168)
Excess of depreciation over capital allowances 17 21 19
Excess expenses1 89 145 105
Deferred acquisition expenses (56) (66) (61)
Difference between the tax and accounting value of insurance contracts (126) (95) (143)
Accounting provisions 16 3 3
Trading losses2 10 53 45
Pension fund deficit 85 90 98
Purchased interest in long term business (23) (25) (24)
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