RBS 2004 Annual Report Download - page 150

148
Notes on the accounts
Notes on the accounts
1 Dealing profits
2004 2003* 2002*
£m £m £m
Foreign exchange (1) 616 540 447
Securities
Equities (2) 36 24 18
Debt (3) 811 774 644
Interest rate derivatives (4) 525 455 353
1,988 1,793 1,462
Dealing profits include interest income and expense recognised on trading-related interest-earning assets and interest-bearing liabilities
and exclude direct costs and administrative expenses.
Notes:
(1) Includes spot and forward foreign exchange contracts and currency swaps, futures and options and related hedges and funding.
(2) Includes equities, equity derivatives, commodity contracts and related hedges and funding.
(3) Includes debt securities and related hedges and funding.
(4) Includes interest rate swaps, forward rate agreements, interest rate options, interest rate futures and credit derivatives and related hedges and funding.
2 Administrative expenses – staff costs
2004 2003* 2002*
£m £m £m
Wages, salaries and other staff costs 4,543 3,997 4,001
Social security costs 295 248 239
Pension costs (see Note 3) 506 408 344
5,344 4,653 4,584
* restated (see page 139)
The average number of persons employed by the Group during the year, excluding temporary staff, was 133,300 (2003 – 119,500;
2002 – 113,500).
3 Pension costs
The Group operates a number of pension schemes which are predominantly defined benefit schemes whose assets are independent of
the Group's finances. In addition to the main scheme, The Royal Bank of Scotland Group Pension Fund, the Group operates a number
of other UK and overseas pension schemes. It also provides other post-retirement benefits, principally through subscriptions to private
healthcare schemes in the UK and the US and unfunded post-retirement benefit plans. Provision for the costs of these benefits is charged
to the profit and loss account over the average remaining future service lives of the eligible employees. The amounts are not material.
The total pension costs for the Group were as follows:
Main UK Other 2004 2003 2002
scheme schemes Total Total Total
Amount charged to profit and loss account £m £m £m £m £m
Expected return on pension scheme assets (840) (82) (922) (826) (988)
Interest on pension scheme liabilities 759 78 837 774 787
Net return credited to other operating income (81) (4) (85) (52) (201)
Current service cost 400 51 451 371 322
Past service cost — 11 11 —3
Net pension cost defined benefit schemes 319 58 377 319 124
Defined contribution schemes and other retirement benefits — 44 44 37 19
Total net pension costs 319 102 421 356 143
2004 2003 2002
The total net pension costs are included in the profit and loss account as follows: £m £m £m
Other operating income (85) (52) (201)
Staff costs – pension costs (see Note 2) 506 408 344
Total net pension costs 421 356 143