STATEMENT OF COMPREHENSIVE INCOME * Premium revenue 5 9,135 8,046 Outwards reinsurance premium expense 6 (817) (700) Net premium revenue (i) 8,318 7,346 Claims expense 6 (5,800) (6,979) Reinsurance and other recoveries revenue 5 818 1,558 Net claims expense (ii) 11 (4,982) (5,421) Acquisition costs 6 (1,203) (1,130) Other underwriting expenses 6 (644) (566) Fire services levies 6 (331) (298) Underwriting expenses (iii) (2,178) (1,994) Underwriting profit/(loss) (i) + (ii) + (iii) 1,158 (69) Investment income on assets backing insurance liabilities 5 290 934 Investment expenses on assets backing insurance liabilities 6 (20) (20) Insurance profit/(loss) 1,428 845 Investment income on equity holders' funds 5 371 101 Fee and other income 5 175 164 Share of net profit/(loss) of associates 5 (29) (13) Finance costs 6 (95) (97) Fee based, corporate and other expenses 6 (245) (228) Net income attributable to non-controlling interests in unitholders' funds 6 (12) (9) Profit/(loss) before income tax from continuing operations 1,593 763 Income tax (expense)/credit 7 (424) (177) Profit/(loss) after tax from continuing operations 1,169 586 Profit/(loss) after tax from discontinued operation 26 (287) (321) Profit/(loss) for the year 882 265 OTHER COMPREHENSIVE INCOME AND (EXPENSE), NET OF TAX Items that will not be reclassified to profit or loss: Actuarial gains and (losses) on defined benefit arrangements 35 (73) Income tax on items that will not be reclassified to profit or loss (12) 21 23 (52) Items that may be reclassified subsequently to profit or loss: Net movement in foreign currency translation reserve 82 18 Income tax on items that may be reclassified to profit or loss 40 (3) 122 15 Other comprehensive income and (expense), net of tax 145 (37) Total comprehensive income and (expense) for the year, net of tax 1,027 228 PROFIT/(LOSS) FOR THE YEAR ATTRIBUTABLE TO Equity holders of the Parent - continuing operations 1,063 528 Equity holders of the Parent - discontinued operation 26 (287) (321) Non-controlling interests 106 58 Profit/(loss) for the year 882 265 TOTAL COMPREHENSIVE INCOME AND (EXPENSE) FOR THE YEAR ATTRIBUTABLE TO Equity holders of the Parent - continuing operations 1,127 487 Equity holders of the Parent - discontinued operation (206) (317) Non-controlling interests 106 58 Total comprehensive income and (expense) for the year, net of tax 1,027 228 * Prior year comparatives have been re-presented due to the discontinued operation, refer to note 26. 46 IAG ANNUAL REPORT 2013
STATEMENT OF COMPREHENSIVE INCOME (CONTINUED) EARNINGS PER SHARE - continuing and discontinued operations cents cents * Basic earnings per ordinary share 9 37.57 10.01 Diluted earnings per ordinary share 9 36.44 9.96 EARNINGS PER SHARE - continuing operations Basic earnings per ordinary share 9 51.46 25.54 Diluted earnings per ordinary share 9 49.60 25.39 * Prior year comparatives have been re-presented due to the discontinued operation, refer to note 26. The above statement of comprehensive income should be read in conjunction with the notes to the financial statements. 47
BALANCE SHEET AS AT 30 JUNE 2013 ASSETS Cash held for operational purposes 24 394 969 Investments 15 13,616 12,953 Premium receivable 16 2,712 2,502 Trade and other receivables 16 526 449 Assets discontinued operation 26 96 - Reinsurance and other recoveries on outstanding claims 12 2,858 3,928 Deferred levies and charges 151 178 Deferred outwards reinsurance expense 13 542 493 Deferred acquisition costs 13 795 753 Deferred tax assets 7 401 373 Property and equipment 17 257 274 Investment in joint ventures and associates 28 577 384 Intangible assets 18 245 225 Goodwill 19 1,666 1,625 Other assets 23 26 Total assets 24,859 25,132 LIABILITIES Trade and other payables 20 1,263 1,135 Reinsurance premium payable 451 264 Restructuring provision 21 6 20 Current tax liabilities 253 257 Unearned premium liability 14 5,145 4,942 Non-controlling interests in unitholders' funds 210 216 Employee benefits provision 29 305 358 Liabilities discontinued operation 26 106 - Deferred tax liabilities 7-9 Outstanding claims liability 11 10,474 11,709 Interest bearing liabilities 22 1,620 1,659 Other liabilities 38 39 Total liabilities 19,871 20,608 Net assets 4,988 4,524 EQUITY Share capital 23 5,353 5,353 Treasury shares held in trust 23 (62) (55) Reserves 23 63 (68) Retained earnings (568) (887) Parent interest 4,786 4,343 Non-controlling interests 202 181 Total equity 4,988 4,524 The above balance sheet should be read in conjunction with the notes to the financial statements. 48 IAG ANNUAL REPORT 2013
STATEMENT OF CHANGES IN EQUITY SHARE CAPITAL TREASURY SHARES HELD IN TRUST FOREIGN CURRENCY TRANSLATION RESERVE SHARE BASED REMUN- ERATION RESERVE RETAINED EARNINGS NON- CONTROLLING INTERESTS TOTAL EQUITY $m 2013 Balance at the beginning of the financial year 5,353 (55) (94) 26 (887) 181 4,524 Profit/(loss) for the year - - - - 776 106 882 Other comprehensive income and (expense) - - 122-23 - 145 Total comprehensive income/(expense) for the year - - 122-799 106 1,027 Transactions with owners in their capacity as owners Shares acquired and held in trust - (28) - - - - (28) Share based payment expense recognised - - - 27 - - 27 Share based remuneration vested - 21 - (18) (3) - - Dividends determined and paid - - - - (478) (85) (563) Dividends received on treasury shares held in trust - - - - 1-1 Balance at the end of the financial year 5,353 (62) 28 35 (568) 202 4,988 2012 Balance at the beginning of the financial year 5,353 (57) (109) 25 (795) 163 4,580 Profit/(loss) for the year - - - - 207 58 265 Other comprehensive income and (expense) - - 15 - (52) - (37) Total comprehensive income/(expense) for the year - - 15-155 58 228 Transactions with owners in their capacity as owners Shares acquired and held in trust - (14) - - - - (14) Share based payment expense recognised - - - 18 - - 18 Share based remuneration vested - 16 - (17) 1 - - Dividends determined and paid - - - - (250) (40) (290) Dividends received on treasury shares held in trust - - - - 2-2 Balance at the end of the financial year 5,353 (55) (94) 26 (887) 181 4,524 The above statement of changes in equity should be read in conjunction with the notes to the financial statements. 49
CASH FLOW STATEMENT CASH FLOWS FROM OPERATING ACTIVITIES Premium received 9,543 8,692 Reinsurance and other recoveries received 1,493 1,688 Claims costs paid (6,645) (6,524) Outwards reinsurance premium expense paid (692) (796) Dividends received 33 31 Interest and trust distributions received 615 616 Finance costs paid (88) (88) Income taxes refunded 3 3 Income taxes paid (427) (253) Other operating receipts 882 1,239 Other operating payments (2,927) (3,094) Net cash flows from operating activities 24 1,790 1,514 CASH FLOWS FROM INVESTING ACTIVITIES Net cash flows on acquisition of subsidiaries and associates (245) (236) Net cash flows on disposal of subsidiaries 43 - Proceeds from disposal of investments and property and equipment 14,166 9,090 Outlays for investments and property and equipment (15,445) (9,623) Net cash flows from investing activities (1,481) (769) CASH FLOWS FROM FINANCING ACTIVITIES Outlays for purchase of treasury shares (28) (14) Proceeds from issue of trust units 169 128 Outlays for redemption of trust units (188) (104) Proceeds from borrowings - 611 Repayment of borrowings (99) (350) Dividends paid to IAG equity holders (478) (250) Dividends paid to non-controlling interests (85) (40) Dividends received on treasury shares 1 2 Net cash flows from financing activities (708) (17) Net movement in cash held (399) 728 Effects of exchange rate changes on balances of cash held in foreign currencies 49 6 Cash and cash equivalents at the beginning of the financial year 2,066 1,332 Cash and cash equivalents at the end of the financial year 24 1,716 2,066 The above cash flow statement should be read in conjunction with the notes to the financial statements. 50 IAG ANNUAL REPORT 2013