BP 2010 Annual Report Download - page 129

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Additionalinformationforshareholders
Additional information for shareholders
BPbelievesthatithasacontractualrighttorecovertheco-owners’shares
ofthecostsincurred;however,norecoveryamountshavebeenrecognized
inthenancialstatementsasat31December2010.
Pensions and other post-retirement benets
Accountingforpensionsandotherpost-retirementbenetsinvolves
judgementaboutuncertainevents,includingestimatedretirementdates,
salarylevelsatretirement,mortalityrates,ratesofreturnonplanassets,
determinationofdiscountratesformeasuringplanobligations,assumptions
forinationrates,UShealthcarecosttrendratesandratesofutilizationof
healthcareservicesbyUSretirees.
Theseassumptionsarebasedontheenvironmentineachcountry.
Determinationoftheprojectedbenetobligationsforthegroup’sdened
benetpensionandpost-retirementplansisimportanttotherecorded
amountsforsuchobligationsonthebalancesheetandtotheamountof
benetexpenseintheincomestatement.Theassumptionsusedmayvary
fromyeartoyear,whichwillaffectfutureresultsofoperations.Any
differencesbetweentheseassumptionsandtheactualoutcomealsoaffect
futureresultsofoperations.
Pensionandotherpost-retirementbenetassumptionsarereviewed
bymanagementattheendofeachyear.Theseassumptionsareusedto
determinetheprojectedbenetobligationattheyear-endandhencethe
surplusesanddecitsrecordedonthegroup’sbalancesheet,andpension
andotherpost-retirementbenetexpenseforthefollowingyear.
Thepensionandotherpost-retirementbenetassumptionsat
December2010,2009and2008areprovidedinFinancialstatements–
Note38onpage202.
Theassumedrateofinvestmentreturn,discountrate,inationrate
andtheUShealthcarecosttrendratehaveasignicanteffectonthe
amountsreported.Asensitivityanalysisoftheimpactofchangesinthese
assumptionsonthebenetexpenseandobligationisprovidedinFinancial
statements–Note38onpage202.
Inadditiontothenancialassumptions,weregularlyreviewthe
demographicandmortalityassumptions.Mortalityassumptionsreectbest
practiceinthecountriesinwhichweprovidepensionsandhavebeen
chosenwithregardtothelatestavailablepublishedtablesadjustedwhere
appropriatetoreecttheexperienceofthegroupandanextrapolationof
pastlongevityimprovementsintothefuture.Asensitivityanalysisofthe
impactofchangesinthemortalityassumptionsonthebenetexpenseand
obligationisprovidedinFinancialstatements–Note38onpage202.
Actuarialgainsandlossesarerecognizedinfullwithinother
comprehensiveincomeintheyearinwhichtheyoccur.
Property,plantsandequipment
BPhasfreeholdandleaseholdinterestsinrealestateinnumerous
countries,butnoindividualpropertyissignicanttothegroupasawhole.
SeeExplorationandProductiononpage40foradescriptionofthegroup’s
signicantreservesandsourcesofcrudeoilandnaturalgas.Signicant
planstoconstruct,expandorimprovespecicfacilitiesaredescribedunder
eachofthebusinessheadingswithinthissection.
Shareownership
Directors and senior management
Asat24February2011,thefollowingdirectorsofBPp.l.c.heldinterests
inBPordinarysharesof25centseachortheircalculatedequivalentasset
outbelow:
 Ordinary Performance Restricted
Director shares sharesa sharesb
C-HSvanberg 925,000 – –
RWDudley 280,799c 1,120,716c
PMAnderson 6,000c – –
FLBowman 7,320c – –
ABurgmans 10,156 – –
CBCarroll 10,500c – –
SirWilliamCastell 82,500 – –
ICConn  417,553d 2,016,005 133,452
GDavid  159,000c – –
IELDavis 10,000 – –
DJFlint  15,000 – –
DrBEGrote 1,372,643e 2,376,570c
DrDSJulius 15,000 – –
BRNelson – – –
FPNhleko – – –
PerformancesharesawardedundertheBPExecutiveDirectors’IncentivePlan.Thesegures
representthemaximumpossiblevestinglevels.Theactualnumberofshares/ADSsthatvestwill
dependontheextenttowhichperformanceconditionshavebeensatisedoverathree-yearperiod.
RestrictedshareawardundertheBPExecutiveDirectors’IncentivePlan.Theseshareswillvestin
2013,subjecttothedirector’scontinuedserviceandsatisfactoryperformance.
Held
asADSs.
Includes48,024sharesheldasADSs.
HeldasADSs,exceptfor94sharesheldasordinaryshares.
Asat24February2011,thefollowingdirectorsofBPp.l.c.heldoptions
undertheBPgroupshareoptionschemesforordinarysharesortheir
calculatedequivalentassetoutbelow:
Director   Options
RWDudleya   259,218
ICConn    203,472
DrBEGroteab   349,998
HeldasADSs.
Theseoptionslapsedon25February2011.
Therearenodirectorsormembersofseniormanagementwhoownmore
than1%oftheordinarysharesoutstanding.At24February2011,all
directorsandseniormanagementasagroupheldinterestsin9,736,214
ordinarysharesortheircalculatedequivalent,6,045,743performance
sharesortheircalculatedequivalentand1,479,297optionsforordinary
sharesortheircalculatedequivalentundertheBPgroupshare
optionsschemes.
Additionaldetailsregardingtheoptionsgrantedandperformance
sharesawardedcanbefoundinthedirectors’remunerationreporton
pages117-118.
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BPAnnualReportandForm20-F2010 127