HSBC 2002 Annual Report Download - page 257

255
HSBC* HSBC Holdings* Associates
US$m US$m US$m
Revaluation reserves:
– Investment property revaluation reserve:
At 1 January 2000 ..................................................................... 273 – 46
Unrealised deficit on revaluation of land and buildings............ 14 – 8
Transfer to revaluation reserve.................................................. 8 – –
Realisation on disposal of properties......................................... (4) – –
Exchange and other movements ................................................ (2) – (1)
At 31 December 2000................................................................ 289 – 53
– Revaluation reserve:
At 1 January 2000 ..................................................................... 2,069 22,565 5
Realisation on disposal of properties......................................... (36) – –
Unrealised surplus on revaluation of properties ........................ 361 1 4
Transfer of depreciation from profit and loss account reserve .. (21) – –
Transfer from investment property revaluation reserve............. (8) – –
Net increase in attributable net assets of subsidiary
undertakings........................................................................... – 9,841 –
Exchange and other movements ................................................ (43) (44) 1
At 31 December 2000................................................................ 2,322 32,363 10
Total revaluation reserves ............................................................. 2,611 32,363 63
Profit and loss account:
At 1 January 2000 ..................................................................... 24,948 4,725 225
Retained profit for the year........................................................ 2,447 250 5
Revaluation reserve realised on disposal of properties.............. 40 – –
Arising on shares issued in lieu of dividends ............................ 944 944 –
Capitalised on issue of shares to QUEST.................................. (324) (324) –
Transfer of depreciation to revaluation reserves........................ 21 – –
Exchange and other movements ................................................ (1,019) – (41)
At 31 December 2000................................................................ 27,057 5,595 189
* Figures for 2001 and 2000 have been restated to reflect the adoption of UK Financial Reporting Standard 19 ‘Deferred Tax’, details
of which are set out in Note 1 on the Financial Statements on pages 195 to 197.
The accumulated foreign exchange translation adjustment as at 31 December 2002 increased HSBC’ s reserves by
US$411 million (2001: reduced by US$3,370 million; 2000: reduced by US$2,073 million).
Cumulative goodwill amounting to US$5,138 million (2001: US$5,138 million) has been charged against reserves in
respect of acquisitions of subsidiary undertakings prior to 1 January 1998.
Statutory share premium relief under Section 131 of the Companies Act 1985 was taken in respect of the acquisition
of CCF in 2000 and the shares issued were recorded at their nominal value only; in HSBC’ s consolidated accounts
the fair value difference of US$8,290 million was transferred to a merger reserve.
Many of HSBC’ s banking subsidiary undertakings, joint ventures and associates operate under local regulatory
jurisdictions which could potentially restrict the amount of reserves which can be remitted to HSBC Holdings plc in
order to maintain local regulatory capital ratios. In addition, the remittance of reserves may result in further taxation
liabilities.
In 1999, HSBC established a qualifying employee share ownership trust (QUEST) to operate in conjunction with the
Savings-Related Share Option Plan by acquiring shares in HSBC Holdings and using them to satisfy share options.