erg........ no longer a dog, page-3

erg--pre payment 13,990 vwap 112.47 6/10 Reversal of prior year profit, exchange movement and equity losses applicable to Prepayment Cards Limited – 13,990
ERG 6/10/03----
ERG is currently finalising an agreement that will see its shareholding in PCL move from 47% to 55% before the finalisation of the Yorcard contracts. The remaining 45% is held by Stagecoach Holdings PLC, First Group PLC and National Express Group PLC – the three largest transit operators in the UK. Accordingly, it is anticipated ERG will account for PCL on a consolidated basis by the end of the calendar year.
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N.E. Renton "understanding the Stock Exchange." page 157 chapter 823.
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1)Where less than 20% of another company is owned, then the shareholding is treated as an investment and credit is taken only for the dividends actually received or receivable.
2) If between 20 and 50 per cent is owned then "equity accounting" can be used, meaning that credit can be taken for a proportionate share of the profits, whther this is distributed or not.
###3) If more than 50% owned, then the company becomes a subsidiary and this latter principle again applies: credit is taken for all ther profits, less the proportion belonging to the outside minority shareholders (if any).###
Regards,--bell