Tesco has seen hundreds of millions of pounds wiped off the balance sheet due to the treatment of employee benefits under IFRS.
In its 2004/05 restated figures, Net assets fell by £400m, mainly due to a £735m hit in accounting for its pension deficit.
Despite this, the retailer’s bottom line has been barely dented, with profit after tax for 2004/05 falling by £19m compared to UK GAAP.
The retailer also suffered actuarial losses on its defined benefit scheme of £230m after applying the amended IAS19. It said that this approach was ‘consistent’ with the treatment required by UK standard FRS17.
It has also opted out of financial instruments standards IAS32 and 39 until next year.
Its first sole IFRS results will be interims published on 20 September.
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