24 September 2001
Melbourne and London
BHP Billiton has confirmed it will table both the Limited and Plc financial statements for the consideration of shareholders at the BHP Billiton Limited Annual General Meeting on October 16 and the BHP Billiton Plc Annual General Meeting on October 19 this year.
In keeping with previous practice, shareholders attending either the Limited or Plc meeting will also have the opportunity to ask questions regarding both sets of accounts. However, in what is hoped will be a one-off occurrence, BHP Billiton has indicated it will not seek shareholder approval for its annual accounts at either meeting.
BHP Billiton Company Secretary Karen Wood said: "The situation has arisen because of the need to produce two sets of financial statements for the year to meet the regulatory requirements in Australia and the United Kingdom and the requirements under the terms of the merger. As shareholders will not receive copies of both sets of financial statements, (which together comprise 428 pages) unless they make a specific request, it seems unreasonable to ask them to approve the accounts. The terms of the merger require matters considered by one Company at its annual general meeting, to also be considered by the other Company."
The laws in Australia and the United Kingdom take a different approach to reporting the financial results for the year ended 30 June 2001. In the UK the law requires BHP Billiton Plc to report as though it had been merged with BHP Billiton Limited for the whole of the financial year even though the merger only took effect on 29 June. Consistent with UK law, the financial statements were prepared according to UK accounting standards and reported in US dollars. Conversely, the financial statements for BHP Billiton Limited had to be prepared on a stand alone basis using the applicable Australian accounting standards and were reported in Australian dollars.
The different regulatory requirements make it difficult for shareholders to reconcile the two separate reports. This is a further reason why BHP Billiton believes it is unreasonable to ask shareholders of one Company to adopt the accounts of the other.
Although it has not been the practice of BHP Limited in the past to ask shareholders to resolve to adopt the financial statements, the Board is not averse to doing so going forward but believes that shareholders should have an opportunity to properly consider the statements in advance of the annual general meetings. It is hoped that it will not be necessary to produce such voluminous material going forward and that, as a result, shareholders will be able to receive reports on the financial affairs of both companies in a form that can be easily distributed.
BHP Billiton has consulted with a large number of institutional shareholders in the UK, together with representatives of their professional associations, to explain the issue that has arisen this year and to express the BHP Billiton's hope that this will be a "one off" occurrence.