Specimen Financial Statements: Marks and Spencer plc Marks and Spencer (M&S) plc is one of the United Kingdom's leading retailers, with over 1,330 stores worldwide. The company is committed to delivering sustainable, high quality food, clothing, and home products. CONSOLIDATED INCOME STATEMENT E 53 weeks ended 1 April 2017 Underlying Non-underlying Em m 10,622.0 Total Em Notes 2.3 53 weeks ended 2 April 2016 Underlying Non-underlying Em Em 10.555.4 Total Em Revenue 10,622.0 10.555.4 Operating profit 2,3,5 690.6 (437.4) 253.2 7849 (2008) 584.1 6 36.2 21.1 Finance income Finance costs 36.2 (113.0) 21.1 (116.4) 6 (113.0) (1164) Profit before tax Income tax expense Profit for the year 4,5 7 613.8 (122.4) 491.4 (437.4) 61.7 (375.7) 176.4 (60.7) 115.7 689.6 (1188) 570.8 (2008) 344 (166.4) 488,8 (84.4) 404.4 Attributable to: Owners of the parent Non-controlling interests (375.7) 1171 (166.4) 492.8 (1.4) 491.4 (1.4) 115.7 5733 (25) 5708 4069 (25) 404.4 (375.7) (1664) 8 30.4p Basic earnings per share Diluted earnings per share 72p 7.2p 35.0p 349p 249p 24 8p 8 30.2p CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME O 53 weeks ended 1 April 2017 m 115.7 53 weeks ended 2 April 2016 Em Notes 404.4 Profit for the year Other comprehensive income: Items that will not be reclassified to profit or loss Remeasurements of retirement benefit schemes Tax charge/(credit) on items that will not be reclassified 11 (68.9) 25.3 (43.6) 346.2 (456) 300.6 31.0 73 Items that will be reclassified subsequently to profit or loss Foreign currency translation differences Cash flow hedges and net investment hedges -fair value movements recognised in other comprehensive income -reclassified and reported in profit or loss -amount recognised in inventories Tax credit on cash flow hedges and net investment hedges 56.1 (72.4) (20.1) 4.1 (1.3) (44.9) 70.8 (30.1) (22.1) 59 65 (325) 268.1 6725 Other comprehensive expense)/income for the year, net of tax Total comprehensive income for the year Attributable to: Owners of the parent Non-controlling interests 72.2 (1.4) 70.8 6750 (25) 6725 CONSOLIDATED STATEMENT OF FINANCIAL POSITION E As at 1 April 2017 m As at 2 April 2016 Em Notes 14 15 709.0 4,837.8 15.5 Assets Non-current assets Intangible assets Property, plant and equipment Investment property Investment in joint ventures Other financial assets Retirement benefit asset Trade and other receivables Derivative financial instruments Deferred tax assets 7.0 8028 5,0271 155 69 30 851.0 2347 74.0 16 3.0 11 17 706.0 234.1 56.8 21 23 6,569.2 7,015.0 16 Current assets Inventories Other financial assets Trade and other receivables Derivative financial instruments Current tax assets Cash and cash equivalents 758.5 14.5 318.6 163.1 17 21 7999 19.1 321.1 72.1 1.6 2476 1,4614 8,4764 18 468.6 1,723.3 8,292.5 Total assets Liabilities Current liabilities Trade and other payables 19 1,553.8 1617.7 71.9 719 12 20 Partnership liability to the Marks & Spencer UK Pension Scheme Borrowings and other financial liabilities Derivative financial instruments Provisions Current tax liabilities 21 518.0 10.5 147.2 66.6 2,368.0 2975 285 14.0 752 22 2,1048 11 19 12 Non-current liabilities Retirement benefit deficit Trade and other payables Partnership liability to the Marks & Spencer UK Pension Scheme Borrowings and other financial liabilities Derivative financial instruments Provisions Deferred tax liabilities 20 21 13.2 328.5 324.6 1,711.7 0.8 113.5 281.8 2,774.1 5,142.1 3,150.4 269 3530 3838 1,774.7 02 520 3376 29282 5,033.0 3,443.4 22 23 24 Total liabilities Net assets Equity Issued share capital Share premium account Capital redemption reserve Hedging reserve Other reserve Retained earnings Total shareholders' equity Non-controlling interests in equity Total equity 406.2 416.4 2,210.5 17.3 (6,542.2) 6,648.1 3,156.3 (5.9) 3,150.4 4058 4113 22105 323 (65422) 69275 3,4452 (18) 3 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY = Total Total Ordinary Share Capital Foreign share premium redemption Hedging Other exchange Retained capital account reserve reserve reserve reserve earnings Em Em Em Em m Em Em Em 412.0 392.4 22026 643 (6,5422) (126) 6,683.1 3.1996 4069 4069 Non controlling interest Em Em (0.8) 3,198,8 (25) 4044 (05) 78 3462 (456) 73 3462 (456) 73 3462 (456) (8.3) (218) (22.1) 59 (30.1) (22.1) 59 (30.1) (22.1) 59 As at 29 March 2015 Profit/(loss) for the year Other comprehensive expense)/income: Foreign currency translation Remeasurements of retirement benefit schemes Tax charge on items that will not be reclassified Cash flow hedges and net investment hedges -fair value movement recognised in other comprehensive income -reclassified and reported in profit or loss? - amount recognised in inventories Tax on cash flow hedges and net investment hedges Other comprehensive income/expense) Total comprehensive income (expense) Transactions with owners: Dividends Transactions with non-controlling shareholders Shares issued on exercise of employee share options Purchase of own shares held by employee trusts Shares purchased in buy back Credit for share-based payments Deferred tax on share schemes 65 (320) (320) 11 78 78 2923 6992 65 268.1 6750 6.5 268.1 (2.5) 6725 (301.7) (3017) (301.7) 15 15 1.7 189 206 (79) 79 206 (109) (109) (150.7) (150.7) 172 172 (39) (39) (109) (150.7) 172 (39) =h Deferred tax on share schemes As at 2 April 2016 (39) (39) (4.8) 6,9323 3,4452 4058 4113 22105 323 (65422) (18) 34409 405.8 411.3 2,210.5 32.3 (6,542.2) (4.8)6,932.3 3,445.2 117.1 117.1 (1.8)3,443.4 (1.4) 115.7 (4.3) 35.3 (68.9) 25.3 31.0 (68.9) 25.3 31.0 (68.9) 25.3 77.7 (21.6) (72.4) (20.1) 56.1 (72.4) (20.1) 56.1 (72.4) (20.1) As at 3 April 2016 Profit/(loss) for the year Other comprehensive (expense)/income: Foreign currency translation Remeasurements of retirement benefit schemes Tax credit on items that will not be reclassified Cash flow hedges and net investment hedges -fair value movement recognised in other comprehensive income -reclassified and reported in profit or loss - amount recognised in inventories Tax on cash flow hedges and net investment hedges Other comprehensive income/expense) Total comprehensive income (expense) Transactions with owners: Dividends Transactions with non-controlling shareholders Shares issued on exercise of employee share options Purchase of own shares held by employee trusts Credit for share-based payments Deferred tax on share schemes As at 1 April 2017 111 4.1 (15.0) (15.0) III 4.1 (652) (44.9) 51.9 72.2 11 35.3 4.1 (44.9) 70.8 35.3 (1.4) (377.5) (377.5) (377.5) (2.7) (2.7) 0.4 5.1 - - 5.5 5.5 13.5 13.5 (2.6) (2.6) 30.5 6,617.6 3,156.3 13.5 (2.6) (5.9) 3,150.4 4062 416.4 2,210.5 17.3 (6,542.2) CONSOLIDATED STATEMENT OF CASH FLOWS = 53 weeks ended 1 April 2017 m 53 weeks ended 2 April 2016 m Notes 26 Cash flows from operating activities Cash generated from operations Income tax paid Net cash inflow from operating activities 1,165.7 (98.0) 1,067.7 13113 (993) 12120 27.0 306 Cash flows from investing activities Proceeds on property disposals Purchase of property.plant and equipment Purchase of intangible assets Reduction/(purchase) of current financial assets Interest received Acquisition of subsidiary Net cash used in investing activities (309.1) (101.1) 4.6 6.6 (3633) (1868) (72) 6.8 (562) (576.1) (372.0) (1135) 3.1 (199) Cash flows from financing activities Interest paid Cash (outflow)/inflow from borrowings Repayment of syndicated loan notes Issuance of medium-term notes Decrease in obligations under finance leases Payment of liability to the Marks & Spencer UK Pension Scheme Equity dividends paid Shares issued on exercise of employee share options Purchase of own shares by employee trust (111.2) (32.7) (215.3) 300.0 (2.0) (57.9) (377.5) 5.5 (2.4) (56.0) (301.7) 206 (109) (377.5) 5.5 Equity dividends paid Shares issued on exercise of employee share options Purchase of own shares by employee trust Share buy back Net cash used in financing activities (301.7) 20.6 (109) (1507) (631.4) (491.1) Net cash inflow from activities Effects of exchange rate changes Opening net cash Closing net cash 204.6 5.6 196.0 406.2 45 3.7 187.8 196.0 27 1. Includes interest on the partnership liability to the Marks & Spencer UK Pension Scheme. 53 weeks ended 1 April 2017 m 53 weeks ended 2 April 2016 Em Notes Reconciliation of net cash flow to movement in net debt Opening net debt Net cash inflow from activities (Decrease)/increase in current financial assets Decrease in debt financing Exchange and other non-cash movements Movement in net debt Closing net debt (2,138.3) 204.6 (4.6) 7.9 (4.3) 203.6 (1,934.7) (2,223.2) 45 72 75.2 (2.0) 849 27 Instructions Refer to M&S's financial statements and the accompanying notes to answer the following questions. a. What is the company's main line of business? b. In what countries does M&S have investments? c. What is the address of the company's corporate headquarters? d. What is the company's reporting currency