Annual Report and Accounts 2016


John Lewis Partnership plc


113


2 Partnership performance (continued)


2.3 Exceptional item Exceptional items are material, non-recurring items of income and/or expense arising from events or transactions that fall within the activities of the Partnership. We believe these exceptional items are relevant for an understanding of our underlying financial performance, and are highlighted separately on the face of the income statement. This note provides detail of the exceptional items reported in both the current and prior year.


On 16 April 2015, the Partnership disposed of a property which was previously held for sale. The profit on disposal of £129.3m has been recorded as exceptional operating income in the period to 30 January 2016. A tax charge of £25.1m was recognised on the exceptional item.


In the year ending 31 January 2015, exceptional operating income was recorded totalling £7.9m in respect of a review of the Partnership’s holiday pay policy in 2014. This comprised a release of £3.4m from the pension liability and a release of £4.5m from other provisions, as the estimated costs for correcting our systems following the review, and updating pension scheme members’ entitlements were lower than originally expected. A tax charge of £1.7m was recognised on the exceptional item.


2.4 Profit before tax Detailed below are items charged/credited to arrive at our profit before tax as defined by IFRS and required to be reported under IFRS.


2016 £m


Staff costs (note 2.6.2) Depreciation – owned assets


Depreciation – assets held under finance leases Amortisation of intangible assets


Net profit on sale of property (including exceptional item) Loss on disposal of other plant and equipment and intangible assets Inventory – cost of inventory recognised as an expense Reorganisation costs


Operating lease rentals: – land and buildings – plant and machinery


Sub-lease income: – land and buildings


(1,889.3) (283.2) (2.8) (91.2) 127.7


(2.9)


(6,442.1) (12.8)


(168.4) (0.5)


6.1


2015 £m


(1,814.8) (278.8) (2.9)


(76.1) 14.2


(1.9)


(6,426.9) (6.9)


(158.2) (0.4)


8.1


Contingency rents expensed during the year were £2.5m (2015: £3.1m). Contingency rents are determined based on store revenues. Total auditors’ remuneration is included within administrative expenses, and is payable to our auditors, PricewaterhouseCoopers LLP, as analysed below:


Auditors’ remuneration


Audit and audit-related services: – Audit of the parent company and consolidated financial statements – Audit of the Company’s subsidiaries


Non-audit services: – Other assurance services – Other non-audit services


Total fees


2016 £m


(0.3) (0.5) (0.8)


(0.1) –


(0.1) (0.9)


2015 £m


(0.3) (0.5) (0.8)


(0.1) (0.2) (0.3) (1.1)


In addition to the above, the Partnership’s auditors also acted as auditors to the Partnership’s pension scheme. The aggregate fee for audit services to the pension scheme during the year was £57,900 (2015: £51,300).


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