Insurance giant sees £100m profits dip

Britain’s largest insurance group Aviva has seen a near £100m dip in
statutory operating profit before tax under new accounting rules, the company
announced in an IFRS restatement of its 2004 results this morning.

Aviva said its 2004 operating profit would fall 5% from £1.861bn to £1.766bn
under IFRS because of changes including the timing of profit recognition on
investments and the way it allocates tax between shareholders and policyholders.

In a further hit, changes Aviva chose to make to its calculation for
longer-term investment return cut the figure by a further £97m.

Andrew Moss, Aviva finance director, played down the results and simply
called IFRS a ‘technical change’ to the way the company reports its statutory
results. ‘There is no underlying change to the economics of Aviva’s business’,
he said.

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