Aviva plc: Adoption of Aviva Market Consistent Embedded Value (MCEV) methodology and impact on results
Group MCEV analysis of earnings
| Reviewed 6 months 2008 | ||||||
|---|---|---|---|---|---|---|
| Covered business1 £m A |
Non- covered but related to life business2 £m B |
Total life business3 £m A+B |
Non- covered relating to non-life £m C |
Total non- covered business £m B+C |
Total £m A+B+C |
|
| Opening Group MCEV | 18,248 | 2,059 | 20,307 | 881 | 2,940 | 21,188 |
| Opening adjustments | – | – | – | – | – | – |
| Adjusted opening Group MCEV | 18,248 | 2,059 | 20,307 | 881 | 2,940 | 21,188 |
| Operating MCEV earnings | 774 | – | 774 | 126 | 126 | 900 |
| Non-operating MCEV earnings | (2,836) | (19) | (2,855) | (446) | (465) | (3,301) |
| Total MCEV earnings | (2,062) | (19) | (2,081) | (320) | (339) | (2,401) |
| Other movements in IFRS net equity | – | (88) | (88) | (674) | (762) | (762) |
| Capital and dividend flows | (599) | – | (599) | 264 | 264 | (335) |
| Foreign exchange variances | 800 | 102 | 902 | (13) | 89 | 889 |
| Acquired/divested businesses | 190 | 117 | 307 | (307) | (190) | – |
| Closing Group MCEV | 16,577 | 2,171 | 18,748 | (169) | 2,002 | 18,579 |
| Preference share capital and direct capital instruments | (1,190) | |||||
| Equity attributable to ordinary shareholders of Aviva plc on an MCEV basis | 17,389 | |||||
| Audited Full year 2007 | ||||||
|---|---|---|---|---|---|---|
| Covered business1 £m A |
Non- covered but related to life business2 £m B |
Total life business3 £m A+B |
Non- covered relating to non-life £m C |
Total non- covered business £m B+C |
Total £m A+B+C |
|
| Opening Group MCEV | 16,506 | 1,594 | 18,100 | 528 | 2,122 | 18,628 |
| Opening adjustments | – | – | – | – | – | – |
| Adjusted opening Group MCEV | 16,506 | 1,594 | 18,100 | 528 | 2,122 | 18,628 |
| Operating MCEV earnings | 1,567 | – | 1,567 | 309 | 309 | 1,876 |
| Non-operating MCEV earnings | 52 | (33) | 19 | (191) | (224) | (172) |
| Total MCEV earnings | 1,619 | (33) | 1,586 | 118 | 85 | 1,704 |
| Other movements in IFRS net equity | – | 124 | 124 | 316 | 440 | 440 |
| Capital and dividend flows | (829) | – | (829) | 347 | 347 | (482) |
| Foreign exchange variances | 851 | 61 | 912 | (14) | 47 | 898 |
| Acquired/divested businesses | 101 | 313 | 414 | (414) | (101) | – |
| Closing Group MCEV | 18,248 | 2,059 | 20,307 | 881 | 2,940 | 21,188 |
| Preference share capital and direct capital instruments | (1,190) | |||||
| Equity attributable to ordinary shareholders of Aviva plc on an MCEV basis | 19,998 | |||||
- Covered business represents the business that the MCEV calculations cover, as detailed in the Basis of preparation note. The embedded value is presented net of minority interests and tax.
- Non-covered but related to life business represents the adjustments to the MCEV, including goodwill, to calculate the long-term business net assets on an MCEV basis. View an analysis of net assets on an MCEV basis gross of minority interests.
- Net assets for the total life businesses on an MCEV basis presented net of minority interests.
