Punch Taverns plc 2011 Annual Report

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100 Punch Taverns plc Annual Report and Financial Statements 2011 Notes to the financial statements continued for the 52 weeks ended 21 August 2011 32 Related party transactions continued Company Transactions with key management personnel The key management personnel of the Company comprises members of the Punch Taverns plc Board of Directors. The Directors do not receive any remuneration from the Company (August 2010: £nil) as their emoluments are borne by other Group companies. The Company did not have any transactions, with the exception of transactions related to share-based payments, with the Directors during the financial year (August 2010: £nil). Details of these transactions are provided in the Report on Directors’ remuneration. Transactions with subsidiary undertakings The Company enters into loans with its subsidiary undertakings at both fixed and floating rates of interest on a commercial basis. Hence, the Company incurs interest expense and earns interest income on these loans and advances. 52 weeks to 20 August 2011 £m 52 weeks to 21 August 2010 £m Loans and advances Increase in loan notes owed by subsidiary undertakings 123.8 107.9 (Decrease) / increase in loans owed by subsidiary undertakings (419.2) 175.9 Increase in other loans and advances owed to subsidiary undertakings (106.2) (157.6) The loans are repayable on demand but the Company will not request repayment for at least 12 months. Year end balances arising from transactions with subsidiary undertakings 20 August 2011 £m 21 August 2010 £m Receivables 975.4 1,264.0 Payables (1,624.7) (1,518.5) The amounts owed by subsidiary undertakings include £946.9m (August 2010: £823.1m) of loan notes, all of which are interest-bearing. The loan notes accrue interest at fixed rates ranging between 12% and 15%, which is capitalised quarterly in arrears. In addition, the Company has intercompany loans of £nil (August 2010: £429.7m) owed by subsidiary undertakings that are non-interest-bearing and £560.9m (August 2010: £571.4m) of loans owed to subsidiary undertakings that are non-interest-bearing.
Punch Taverns plc Annual Report and Financial Statements 2011 101 Independent auditor’s report to the members of Punch Taverns plc Independent auditor’s report to the members of Punch Taverns plc We have audited the financial statements of Punch Taverns plc for the 52-week period ended 20 August 2011, which comprise the Consolidated income statement, the Consolidated statement of comprehensive income, the Consolidated and Company balance sheets, the Consolidated and Company cash flow statements, the Consolidated and Company statements of changes in equity and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the EU and, as regards the Company financial statements, as applied in accordance with the provisions of the Companies Act 2006. This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members, as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of Directors and auditor As explained more fully in the Directors’ responsibilities statement set out on page 44, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit, and express an opinion on, the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors. Scope of the audit of the financial statements A description of the scope of an audit of financial statements is provided on the APB’s website at www.frc.org.uk/apb/scope/private.cfm. Opinion on financial statements In our opinion: • the financial statements give a true and fair view of the state of the Group’s and of the Company’s affairs as at 20 August 2011 and of the Group’s loss for the period then ended; • the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the EU; • the Company financial statements have been properly prepared in accordance with IFRSs as adopted by the EU and as applied in accordance with the provisions of the Companies Act 2006; and • the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation. Governance Business review Opinion on other matters prescribed by the Companies Act 2006 In our opinion: • the part of the Directors’ remuneration report to be audited has been properly prepared in accordance with the Companies Act 2006; • the information given in the Directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and • information given in the Corporate governance statement set out on pages 27 to 31 with respect to internal control and risk management systems in relation to financial reporting processes and about share capital structures is consistent with the financial statements. Matters on which we are required to report by exception We have nothing to report in respect of the following: Under the Companies Act 2006 we are required to report to you if, in our opinion: • adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or • the Company financial statements and the part of the Directors’ remuneration report to be audited are not in agreement with the accounting records and returns; or • certain disclosures of Directors’ remuneration specified by law are not made; or • we have not received all the information and explanations we require for our audit; or • a Corporate governance statement has not been prepared by the Company. Financial statements Under the Listing Rules we are required to review: • the Directors’ statement, set out on page 54, in relation to going concern; • the part of the Corporate governance statement on pages 27 to 31 relating to the Company’s compliance with the nine provisions of the UK Corporate Governance Code specified for our review; and • certain elements of the report to shareholders by the Board on Directors’ remuneration. G A Watts (Senior Statutory Auditor) For and on behalf of KPMG Audit Plc Statutory Auditor Chartered Accountants One Snowhill, Snow Hill Queensway Birmingham B4 6GH 19 October 2011
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