(Download XLS:)  |
|
|
Note |
2010 |
2009 |
|---|---|---|---|
|
Derivative liabilities |
3,769 |
3,577 | |
|
Collateral received from banks |
|
288 |
459 |
|
Other |
|
1,416 |
967 |
|
Payables and other financial liabilities |
|
5,473 |
5,003 |
|
Settled within 12 months |
|
5,190 |
4,497 |
|
Settled after 12 months |
|
283 |
506 |
Other includes future commission payments which have contingent settlement provisions of £178m (2009: £167m). This liability has been determined using the net present value of the future commission which will be payable on fund values. This valuation technique uses assumptions which are consistent with the Group’s effective rate of interest, investment return assumptions and persistency assumptions used in other valuations, but it is not determined by reference to published price quotations.
The undiscounted value which is expected to be paid at maturity in respect of such commission is £248m (2009: £225m).
Payables and other financial liabilities settled after 12 months are expected to be settled within five years, with the exception of derivative liabilities, as disclosed in Note 22.
Fair value hierarchy
| (Download XLS:) |
|
As at 31 December 2010 |
Total |
Level 1 |
Level 2 |
Level 3 |
Amortised cost |
|---|---|---|---|---|---|
|
Derivative liabilities |
3,769 |
2,164 |
1,605 |
– |
– |
|
Collateral received from banks |
288 |
288 |
– |
– |
– |
|
Other |
1,416 |
275 |
50 |
178 |
913 |
|
Payables and other financial liabilities |
5,473 |
2,727 |
1,655 |
178 |
913 |
|
|
|
|
|
|
|
|
As at 31 December 2009 |
Total |
Level 1 |
Level 2 |
Level 3 |
Amortised cost |
|
Derivative liabilities |
3,577 |
2,184 |
1,393 |
– |
– |
|
Collateral received from banks |
459 |
459 |
– |
– |
– |
|
Other |
967 |
– |
60 |
167 |
740 |
|
Payables and other financial liabilities |
5,003 |
2,643 |
1,453 |
167 |
740 |
Trail commissions are modelled using expected cash flows, incorporating expected future persistency. They have therefore been classified as level 3 liabilities. The entire movement in the balance has been reflected in the income statement during the year. A reasonably possible alternative persistency assumption would have the effect of increasing or decreasing the liability by £5m (2009: £5m).
There have been no significant transfers between levels.
