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Primary statement: Consolidated cash flow statement
Year ended 31 December 2006
Consolidated cash flow statement
| Note | 2006 £m |
2005 £m |
|
|---|---|---|---|
| Cash flows from operating activities | |||
| Profit before tax* | 2,071 | 2,145 | |
| Changes in operating assets and liabilities: | |||
| Investments | (13,748) | (21,462) | |
| Banking customer accounts | (276) | (861) | |
| Other non-investment and non-cash assets | (232) | (957) | |
| Policyholder liabilities (including unallocated surplus) | 13,540 | 21,113 | |
| Other liabilities (including operational borrowings) | 1,136 | 180 | |
| Interest income and expense and dividend income included in profit before tax | (10,056) | (8,410) | |
| Other non-cash items | 198 | 0 | |
| Operating cash items: | |||
| Interest receipts | 6,466 | 5,946 | |
| Dividend receipts | 3,633 | 2,680 | |
| Tax paid | (523) | (573) | |
| Net cash flows from operating activities | 2,209 | (199) | |
| Cash flows from investing activities | |||
| Purchases of property, plant and equipment | H6 | (174) | (160) |
| Proceeds from disposal of property, plant and equipment | 34 | 6 | |
| Costs incurred on purchase of Egg minority interests | I6 | (6) | - |
| Acquisition of subsidiaries, net of cash balances | I6 | (70) | (68) |
| Disposal of subsidiaries, net of cash balances | I6 | 114 | 252 |
| Net cash flows from investing activities | (102) | 30 | |
| Cash flows from financing activities | |||
| Structural borrowings of the Group: | I10 | ||
| Shareholder-financed operations: | |||
| Issue | - | 168 | |
| Redemption | (1) | (308) | |
| Interest paid | (204) | (204) | |
| With-profits operations: | |||
| Interest paid | (9) | (9) | |
| Equity capital: | |||
| Issues of ordinary share capital | H11 | 15 | 3 |
| Dividends paid | B3 | (323) | (328) |
| Net cash flows from financing activities | (522) | (678) | |
| Net increase (decrease) in cash and cash equivalents | 1,585 | (847) | |
| Cash and cash equivalents at beginning of year | 3,586 | 4,341 | |
| Effect of exchange rate changes on cash and cash equivalents | (100) | 92 | |
| Cash and cash equivalents at end of year | H10 | 5,071 | 3,586 |
*Profit before tax represents income net of post-tax transfers to unallocated surplus of with-profits funds, before tax attributable to policyholders and unallocated surplus of withprofits funds, unit-linked policies and shareholders' profits. It does not represent profit before tax attributable to shareholders.