This excerpt taken from the HBC 20-F filed Mar 10, 2009.
Cash and balances at central banks
This excerpt taken from the HBC 6-K filed Nov 10, 2008.
Derivatives – Under U.S. GAAP, derivative receivables and payables with the same counterparty may be reported on a net basis in the balance sheet when there is an executed International Swaps and Derivatives Association, Inc. (ISDA) Master Netting Arrangement. In addition, under U.S. GAAP, fair value amounts recognized for the obligation to return cash collateral received or the right to reclaim cash collateral paid are offset against the fair value of derivative instruments. Under IFRSs, these agreements do not necessarily meet the requirements for offset, and therefore such derivative receivables and payables are presented gross on the balance sheet.
Goodwill – IFRS s and U.S. GAAP require goodwill to be tested for impairment at least annually, or more frequently if circumstances indicate that goodwill may be impaired. F or IFRSs, goodwill was amortized until 2005, however goodwill was amortized under U.S. GAAP until 2002, which resulted in a lower carrying amount of goodwill under IFRSs . During the third quarter of 2008, HUSI performed an interim goodwill impairment test and determined that goodwill was impaired for the Residential Mortgage reporting unit, which is part of the PFS segment. Due to the lower carrying amount under IFRSs, the impact of the write-off was l ower than under U.S. GAAP.
Property – Under IFRSs, the value of property held for own use reflects
revaluation surpluses recorded prior to January 1, 2004. Consequently, the values of
tangible fixed assets and shareholders’ equity are lower under U.S. GAAP than under
IFRSs. There is a correspondingly lower depreciation charge and higher net income as well
as higher gains (or smaller losses) on the disposal of fixed assets under U.S. GAAP. For
investment properties, net income under U.S. GAAP does not reflect the unrealized gain or
loss recorded under IFRSs for the period.
IFRSs, securities include HSBC shares held for stock plans at fair value.