Mobile phone giant Vodafone said this morning that new international accounting rules would mean a slightly lower cashflow forecast for the year to March 2005.
But the world's largest mobile phone company highlighted that it would also no longer have to amortise billions of pounds of goodwill, increasing reported profit attributable to shareholders by £6.8 billion sterling.
Under the new accounting rules, Vodafone says it expects free cashflow at 'slightly below' £7 billion rather than free cashflow of 'around' £7 billion under UK GAAP rules.
From 2005, most of the 7,000 European stock exchange listed companies have to adopt International Financial Reporting Standards for their group accounts to replace the different standards now used in Europe.
Although analysts do no expect IFRS to change fundamental valuations of Vodafone, they are expecting the new rules to affect reported earnings per share.
