Vodafone 1998 Annual Report Download - page 83

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United States Accounting Principles
cost of the asset. Under US GAAP, the interest cost on borrowings used to finance the construction of an asset is
capitalised during the period of construction until the date that the asset is placed in service. Such interest cost is
amortised over the estimated useful life of the related asset.
Pension costs
Under both UK GAAP and US GAAP pension costs are accrued so as to provide for future pension liabilities. However,
there are differences in the prescribed methods of valuation which give rise to GAAP adjustments to the pension cost and
the pension prepayment.
Proposed dividends
Under UK GAAP, dividends are included in the financial statements when recommended by the Board of directors to the
shareholders. Under US GAAP, dividends are not included in the financial statements until declared by the Board of
directors.
Defeasance of liabilities
Under UK GAAP, liabilities which have been unconditionally satisfied by monetary assets placed in trust and other set
off arrangements are considered to be extingiushed.
Under US GAAP, non recognition of a liability is allowed only if the liability has been legally extinguished.
Earnings per ordinary share
Earnings per ordinary share are calculated by dividing net income of £374.2m and £342.2m for the years ended 31 March
1998 and 1997 respectively, by 3,073,032,493 and 3,060,400,713 which are the approximate weighted average number
of ordinary shares outstanding for the years ended 31 March 1998 and 1997 respectively.
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