faster
reuters group plc
annual report and form 20f 2006 directors’ report
business review
02 explaining reuters
04 ceo’s review
06 our strategy
08 our performance
10 our markets
12 our resources
13 our challenges
14 chairman’s statement
15 the speed of change
16 in the financial world
18 in the media world
20 in reuters
governance
22 interview with the chairman
24 note to the board
25 board
26 directors and senior managers
29 remuneration report
38 statements of directors’
responsibilities and compliance
company information and ofr
44 company information
52 selected financial highlights
54 operating and financial review ofr
financials
consolidated financial statements
73 united kingdom audit opinion
74 united states audit opinion
75 consolidated income statement
75 consolidated statement 
of recognised income and expense
76 consolidated balance sheet
77 consolidated cash flow statement
78 group accounting policies
83 notes to the financial statements
129 summary of differences between
ifrs as adopted by the eu and 
us gaapaccounts continued
132 notes on the summary of
differences between ifrs and us
gaap
134 consolidated financial summary
separate financial statements 
of reuters group plc
136 parent company audit opinion
137 reuters group plc – balance sheet
138 reuters group plc – 
accounting policies
139 reuters group plc – notes 
to the financial statements
reference section
information
144 information for shareholders
155 crossreference guide to form 20f
156 glossary
157 financial diary
157 where to find us
this report comprises the annual report of reuters
group plc in accordance with the requirements of the
united states securities and exchange commission
sec for 2006 a crossreference guide setting out the
information in this annual report that corresponds to the
form 20f items is provided on page 155
definitions of company
as used in this annual report ‘the group’ and ‘reuters’
refer to reuters group plc and its subsidiary
undertakings including joint ventures and associates
‘the company’ refers to reuters group plc
key performance indicators
reuters uses a number of performance measures to
manage its business those that it considers key and 
to which management remuneration was linked in 2006
are revenue trading profit free cash flow adjusted eps
adjusted profit before tax and customer satisfaction for
more information see ‘definition of key financial
performance measures’ on page 67
nongaap measures
a number of measures used in this document are ‘non
gaap’ figures which are performance measures used 
to manage the business supplementing the ifrsbased
measures these include ‘underlying change’ ‘trading
costs’ ‘trading profit’ ‘trading margin’ ‘adjusted eps’
‘free cash flow’ ‘trading cash flow’ and ‘net debtnet
funds’ detailed descriptions of these terms including
the rationale for using them and reconciliations to the
most directly comparable ifrs indicator are provided 
on pages 67–68
forwardlooking statements
under us law all statements other than statements of
historical fact included in this annual report are or may
be deemed to be forwardlooking statements within the
meaning of the us private securities litigation reform
act of 1995 certain important factors that could cause
actual results to differ materially from those discussed 
in such forwardlooking statements are described under
‘risk factors’ on pages 65–67 as well as elsewhere in 
this annual report all written and oral forwardlooking
statements made on or after the date of this annual
report and attributable to the group or any of its
directors are expressly qualified in their entirety by 
such factors
contents
welcome to the reuters group plc annual report and form 20f 2006 
y ou will find the directors’ report for shareholders on pages 01–72 it includes
• our business review which gives a fast read about our business our strategy  our performance 
our markets our resources and our challenges
• our company information which provides additional detail to support our business review
• our ofr which contains a detailed analysis of our financial performance and policies
• an interview with our chairman on corporate governance
• our directors’ and senior managers’ biographies
• our remuneration report
• our statements of directors’ responsibilities and compliance we drive ﬁnancial markets 
power newsrooms and 
inform individuals
reuters group plc annual report and form 20f 2006
this page a general view of
reuters global headquarters 
in canary wharf in london
01 business review we run our business through 
four divisions each meeting a
speciﬁc set of customer needs
sales  trading
our products
advanced desktop ﬁnancial information
products analytics and trading systems
designed for use by traders and salespeople
news realtime market data and trading
systems are our core competencies
enterprise
our products
information feeds and tools designed for 
use by machines to help our customers 
automate their businesses
our data and trading room software form 
a vital part of customers’ systems
2006 revenue
£1690m
2006 revenue
£408m
traders
brokers
salespeople
it decision makers
financial
technology innovators
our customers
our divisions
02 explaining reuters
reuters group plc annual report and form 20f 2006 research 
asset management
our products
indepth information analysis and research
products designed mainly for use by 
people making investment decisions
we give our customers competitive advantage
with highvalue content and insight
media
our products
news for use by professional publishers
multimedia websites and mobile information
services for use by individual consumers
we are the world’s largest multimedia news
agency with scope to build a strong
consumer media business
2006 revenue
£298m
2006 revenue
£170m
corporates
bankers and analysts
investment managers
private wealth managers
website consumers
press
television
total 2006 revenue
£2566m
for more information on our business 
divisions see the ‘ofr’ on pages 54–72
reuters group plc annual report and form 20f 2006
business review 03 our goal is to accelerate the growth 
in revenues begun last year while
bringing a greater proportion to the
bottom line in proﬁts
2006 was a year of considerable
achievement for reuters in last year’s
annual report i stated that the key drivers
for 2006 would be “to deliver on our 
core plus investments to accelerate our
revenue growth to continue to really
focus on customer service and to maintain
the good cost control of the last few
years” i am very happy to say that we
achieved each of these goals and more 
during 2006 we raised the pace of our core
plus programme and produced £32 million
of new revenues from the four initiatives
electronic trading highvalue content new
enterprise services and new markets this
permitted us to exceed our 2006 target of
one percentage point of additional revenue
growth from core plus 
in terms of overall revenue growth we
exceeded market expectations by delivering
65 growth at actual rates 48 underlying
which was very gratifying to me personally 
it was not so long ago that many in the
market while acknowledging our ability to
cut costs doubted that we could restart
growth after a long period of retrenchment 
2006 was also a year in which our signiﬁcant
investments to transform and simplify the
company began to take shape these
investments will continue through 2007 with
a focus on making our services more resilient
finally despite the increased investment in
core plus growth and transformation activities
we continued to hold a tight line on cost 
looking ahead to 2007
as i write this review we are already well into
2007 – a year that has begun strongly for
reuters our principal goal this year is to
accelerate the growth in revenues begun 
last year while bringing a greater proportion
down to the bottom line in proﬁts this will be
achieved in part as revenues from core plus
increase through the year  we’ll also continue
our focus on improving customer service
through investment in reuters infrastructure
and through instilling a service culture at
reuters t owards this goal i am personally
leading a drive to simplify our processes 
our technology and our organisation
in my recent meetings with customers around
the world i have been encouraged both that
general market conditions appear to be
favourable and that the speciﬁc areas we are
targeting under core plus are expected to be
in high demand in particular the growth of
electronic trading is now indisputable
serving both people and machines
reuters has always served the needs of
individual users in the ﬁnancial community 
as well as the machines that power their
ﬁrms however this distinction is increasingly
important reuters suite of trading room
systems risk management platforms
enterprise datafeeds and transaction services
is perfectly aligned to the growth in machine
based activities such as algorithmic trading
at the same time the human beings who are
ceo’s review
reuters group plc annual report and form 20f 2006
04 active in the ﬁnancial services industry require
evermore sophisticated and comprehensive
sets of information and analytics as they seek
to differentiate their performance reuters 
is uniquely skilled to serve this twin need
managing our portfolio
capitalising on our strong position in the
treasury market reuters entered into a joint
venture with the chicago mercantile
exchange cme in 2006 to launch a new
electronic system to trade foreign currencies
the venture called fxmarketspace is
launching in march 2007 and will offer the
market the ability to trade foreign exchange
on a cleared central counterparty basis like
an exchange for the ﬁrst time i view this as 
a great example of reuters innovative streak 
at work as well as proof that we will not just
complacently sit and milk our best assets 
but seek to lead the market in new directions
we also moved swiftly in 2006 to sell the
majority of our 50 interest in the factiva
joint venture to our partner dow jones 
we concluded that we could achieve the
most value for our shareholders by selling
this deep online library of content before
competition from free search engines 
eroded factiva’ s advantage
media and journalism
our media business performed very well in
2006 across both its agency and consumer
units in the agency business we beneﬁted 
as western publishers and broadcasters
retrenched and continued to pull back their
journalists to home base and newspapers 
in particular scrambled to add video to their
websites meanwhile domestic demand in
asia and the middle east grew strongly 
our directtoconsumer unit which mainly
derives its revenues from advertising carried
on reuterscom and associated mobile and
online properties grew 39 in 2006
at the core of what we do at reuters is the
work of our 2400 journalists we increased
our editorial staff by over 130 in 2006 and
produced a slew of exclusives and ‘beats’
from the ongoing war in iraq to the world
cup competition to the israellebanon
conﬂict in my presentation to the israel
business conference excerpted on reuters
corporate website i discuss how reuters
responded to a serious breach of our news
photography standards which occurred 
in lebanon 
the bravery quality and motivation of
reuters journalists around the world remain
a great inspiration to me more generally it 
is the diversity intelligence compassion and
determination of our people that make my
job as ceo so personally rewarding 
tom glocer
ceo
reuters group plc annual report and form 20f 2006
business review 05 1  growth
we are growing our revenues faster both within 
our core business and through our core plus initiatives 
in the medium term we plan to deliver strong
sustainable revenue growth assuming continued
growth in the ﬁnancial services industry
core
steady improvement in our nextgeneration
products is helping us to attract new users
particularly among institutional investors
core products
• reuters 3000 xtra
• reuters knowledge
• reuters datascope realtime 
and reference datafeeds
• reuters trader 
• reuters wealth manager
core plus
we have started to see new revenues come
through from the portfolio of core plus
projects we put in place to capitalise 
on four highgrowth market areas
market areas
• electronic trading 
• highvalue content
• new enterprise services 
• new markets
revenue growth targets
we expect our core business to grow at
least as fast as the market
in addition we have targeted new revenue
from our core plus initiatives
targets
• 1 percentage point of new revenue 
in 2006 exceeded
• 2 percentage points of new revenue 
in 2007
• 3 percentage points of new revenue 
in 2008
our strategy
reuters group plc annual report and form 20f 2006
06
our mission is to make reuters the leading 
provider of content and transaction services 
trusted by customers from the individual to 
the most sophisticated institution
as we move from restructuring to growth our 
aim is to deliver the shareholder value that we 
believe the company is capable of generating 
we are doing this in two ways we are doing this by
• changing the way our product 
development teams work
• simplifying our product delivery
infrastructure and making it 
more robust 
• transforming the way our content 
is created collected and processed
• modernising our customer 
administration systems
customer satisfaction
we measure customer satisfaction through 
a biannual survey of over 12000 ﬁnancial
markets customers satisfaction has 
increased over the last three years with
customers seeing particular improvements 
in the quality of our training support and
account management 
projected cost savings
as we continue to implement these 
initiatives we expect them to deliver
annualised cost savings reaching 
£150 million by 2010
2 simpliﬁcation
we are becoming stronger more competitive 
and more efﬁcient as we continue to simplify our 
organisation we are working hard to deliver better
products and better customer service 
for more information about our strategy 
including details of our core plus initiatives 
see ‘company information’ on pages 44–51
reuters group plc annual report and form 20f 2006
business review
customer satisfaction 
06
05
04
731
723
709
calculated on a 100point scale
07 proﬁt for the year £m
our reported eps was 236p in 2006 down
9p from the previous year reﬂecting lower
proﬁts on disposals than in 2005 when we
disposed of our instinet stake adjusted eps
was 171p in 2006 up 33p from the previous
year this reﬂected lower restructuring
charges and fewer shares in circulation 
due to our share buyback programme
in 2006 we achieved our immediate
goal of restarting revenue growth
our core plus initiatives outperformed
their target
our net cash ﬂow from continuing operating
activities increased by £8 million to £258
million free cash ﬂow was £225 million 
an increase of £137 million as our cash
restructuring charges fell and we improved
our working capital management
we increased our total regular dividend by 
10 the ﬁrst increase since 2000 reﬂecting
our growing conﬁdence in future business
performance
our 2006 revenue grew by 65 to £2566
million acquisitions mainly t elerate
contributed 14 percentage points of growth
exchange rate movements accounted for 
03 percentage points excluding acquisitions
disposals and currency revenue grew by
48 13 percentage points of this growth
came from core plus ahead of our target 
our 2006 proﬁt was £305 million a decrease
of £177 million over the previous year 2005
proﬁt was boosted by proﬁts of £191 million
from the disposal of instinet group
our operating proﬁt rose to £256 million in
2006 operating margin 10 an increase of
£49 million over 2005 operating margin 9
trading proﬁt declined to £308 million
trading margin 12 down £26 million over
2005 trading margin 14 this included 
£77 million of net new investment in core
plus partly offset by revenue growth
our performance
reuters group plc annual report and form 20f 2006
net cash ﬂow from continuing operating
activities and free cash ﬂow

£m
earnings per share eps 
and adjusted eps

pence
operating proﬁt trading proﬁt 
and margins

£m
revenue £m
dividend pence
06
05
04
2566
2409
2339
06
05
04
305
482
375
06
05
04
11p
10p
10p
06
05
04
operating profit trading profit 
256
308
207
334
194
326
06
05
04
236p
171p
326p
138p
260p
118p
eps adjusted eps 
06
05
04
cash flow free cash flow 
258
225
250
88
254
208
08
 for deﬁnitions of trading proﬁt trading margin
adjusted eps and free cash ﬂow see page 54 operating highlights
• revenues growing ahead of target 
• new core plus initiatives making good
progress 
• fxmarketspace joint venture underway
• opening of beijing development centre 
• sale of factiva stake to dow jones
completed
• application networks acquired to broaden
our risk management product line
• first innovation programme projects
launched
2007 outlook
we expect to deliver underlying revenue
growth of 6 or better in 2007 this is 
in line with our plan to deliver strong
sustainable revenue growth in the medium
term assuming continued growth in the
ﬁnancial services industry trading margins
are expected to increase to 13–14 in 2007
putting us on track to achieve our medium
term trading margin target of 17–20

 we
will also keep capital expenditure in 2007 at
similar levels to 2006
we will actively manage our capital structure
to maintain a strong investment grade rating
of bbbbaa1 and to the extent that we
generate cash surplus to our needs we will
continue to seek to return that cash to
shareholders based on current investment
plans we expect to increase our share 
buyback during 2007 to £400–£425 million
which includes the £250 million remaining 
of the £1 billion buyback announced in 
july 2005 in future share buybacks will be
considered periodically based on business
performance investment opportunities and
the bbbbaa1 ratings target
for more information about fxmarketspace our
beijing development centre the sale of our factiva
stake and our innovation programme see ‘company
information’ on pages 44–51
for more information about our acquisition of
application networks and our ﬁnancial performance
see ‘ofr’ on pages 54–72
 operating margins are expected to perform similarly 
but will be subject to additional impact from factors that
cannot be predicted such as fair value movements in
embedded derivatives see description of ‘trading
margin’ on page 54
shareholder returns
£661 m
returned to shareholders in 2006 via 
buybacks and dividends
reuters group plc annual report and form 20f 2006
business review 09 our markets
more than 90 of our revenue comes 
from serving the rapidly evolving ﬁnancial
services marketplace which includes
investment and commercial banks 
brokerdealers asset and wealth managers
and commodities and energy traders 
the innovative ﬁnancial markets are
experiencing rapid structural change 
we are adapting to meet their increasingly
complex and timesensitive demands
the media markets are also undergoing
dramatic change we are wellpositioned 
to address these marketplace dynamics with
our recent innovations in usergenerated
content including blogs and our work to
reach the nextgeneration of media
consumers through new digital platforms
such as mobile phones online video and
interactive television
key market trends
• market structures are continuing to evolve
foreign exchange is set to shift towards
an exchangetraded model bank and
exchange consolidation is ongoing
• the rise in electronic trading is set to
continue in 2007 and beyond
• the ﬁnancial services industry is
developing increasingly complex 
highly structured ﬁnancial products
• the hedge fund industry is expected to
continue its growth and remain important
to the ﬁnancial markets ecosystem
• wealth management is the fastest
growing segment of the ﬁnancial 
services marketplace
• financial information technology spending
is expected to continue rising in 2007
• new market regulations such as the
markets in financial instruments directive
mifid in the eu and regulation nms in
the us are creating requirements for more
extensive disclosure of prices
• traditional media companies are
embracing usergenerated content and
online social networks as new ways of
engaging with their audiences
• online audiences and advertising 
revenues are growing rapidly rivalling
traditional media
over 90 of our revenue comes from
serving the rapidly evolving ﬁnancial
services marketplace our news and
information reach one billion people 
every day
our markets
reuters group plc annual report and form 20f 2006
10 our market share in ﬁnancial markets
each year we publish ﬁndings from our
market size and share study this study 
looks at the £6 billion global market for
ﬁnancial information and services in which
our business operates 80 of our revenues
are covered by the study

our market share by revenue in this market
increased by one percentage point in 2005
to 27 level with bloomberg our main
competitor in the desktop products
business this share gain was largely driven
by the acquisition of t elerate in june 2005
analysis of our market share for the full year
2006 is being ﬁnalised and will be published
in april 2007
as a result of our core plus strategy which is
taking us into new markets our addressable
market is expected to expand from £6 billion
to £11 billion per year
our market share in consumer 
media markets
over the last two years our reuterscom
family of websites has attracted a growing
number of users worldwide and now reaches
166 million visitors per month currently 
our largest audiences are in the us and 
the uk our website ranking in the ﬁnancial
information category as measured by
nielsennetratings in the us improved 
from 8th to 5th based on the number of
unique visitors between 2005 and 2006 
our website ranking in the business
newsresearch category as measured by
comscore media metrix in the uk improved
from 6th to 4th between 2005 and 2006
reuters group plc annual report and form 20f 2006
business review
for more information about our markets 
see ‘company information’ on pages 44–51
us visitors to reuters websites millions
06
05
66
59
number of unique visitors december nielsennetratings us
11
 excludes media revenues recoveries and some 
enterprise revenues our people our
brand and our
content are key to
our ability to deliver
on our strategy
our people
we seek to attract and retain talented
people who are knowledgeable about 
the markets we serve customer focused
adaptable and committed to learning 
and development 
our diverse employee base comprising 
over 100 nationalities reﬂects the different
cultures and markets we operate in and
contributes innovative ways to serve our
wide range of customers 
as we have focused on making our products
more competitive and extending our
content we have built up our development
and content management centres in
bangkok beijing bangalore and singapore
30 of our employees are now based 
in asia
we carry out an annual employee
engagement survey the results of our most
recent survey november 2006 showed 
yearonyear improvements across all the
categories that make up our employee
engagement index leadership customer
orientation performance employee
commitment and career development
employees are given objectives which 
are aligned to the company’ s goals
performance against these objectives is
rewarded through the performancerelated
elements of remuneration such as bonuses
and equity in the company employee
turnover for our highest performers remains
below the 35 target we have set
our brand 
our brand is a powerful asset ranked as 
a t op 100 global brand by interbrand 
the essence of our brand is trust strong
brands attract customers and help to drive
ﬁnancial performance as an organisation
and as a brand we are aligned to deliver
consistently on the reuters trust principles 
of independence integrity and freedom
from bias for more information on how
these principles inform our approach to
doing business see ‘our commitment to
ethics and compliance’ and ‘corporate
responsibility’ on pages 48 to 50
our content
reuters runs the world’ s largest multimedia
news operation employing 2400 journalists
who produce 250000 news stories in 
19 languages 40000 pictures and over 
4000 video stories each month we also
supply the data that powers the ﬁnancial
markets we offer insight into the markets 
by creating polls analytics indices and
composite prices we aggregate price
information collected from contributors for
many asset classes and we distribute trade
data published by exchanges and other
trading venues 
we add unique value to all this content by
organising and labelling it within our data
model a framework which makes it easy for
our customers to use the data within their
own software applications
our resources
reuters group plc annual report and form 20f 2006
for more information about our people and 
our content see ‘company information’
on pages 47–48 and ‘ofr’ on pages 58–59
this page running barefoot
south africa’ s dina phakula
sprints ahead of the
competition at the 2006
commonwealth games
photographer andy clark 
employee engagement 
06
05
04
58
50
47
distribution of employees by region
europe middle east and africa
the americas
asia
based on average number of employees for the year
06
05
04
16300
15900
16000
12 action
• diversify revenues through emphasis on core plus
• prioritise initiatives that help customers achieve greater 
efﬁciency through business automation
see ‘strategy’ on pages 44–45 ‘enterprise division’ on page 61
• continue to develop core plus electronic trading initiatives
• implement services which address mifid and reg nms requirements
• monitor industry shifts closely
• engage with customers’ strategies and ensure our own 
strategy remains aligned with theirs
• launch fxmarketspace with cme
• experiment with new business models within our innovation portfolio
see ‘markets’ on pages 45–47 ‘divisional performance’ on pages 58–62
‘strategy’ on pages 44–45
• set appropriate ‘tone at the top’ from senior management
• provide training on ethics and reuters trust principles
• enforce clear accountability
• ensure regular board review
see ‘corporate governance’ on pages 22–23 ‘our commitment to ethics 
and compliance’ on pages 48–49 ‘people’ on pages 47–48
• measure and monitor service levels
• execute service improvement and content quality plans
• continue to promote a servicedriven culture
• complete investments in data centre and capacity improvements
see ‘strategy’ on pages 44–45 ‘people’ on pages 47–48
• monitor progress closely at board and group leadership t eam level gl t
• prioritise resources for strategic programmes
• monitor the changing nature of our business by using fewer larger
processing venues
see ‘corporate governance’ on pages 22–23 see ‘people’ on pages 47–48
• keep the hiring and development plans in focus
• monitor our performance employee demographics and turnover
• align achievement of organisational objectives more closely 
with remuneration
see ‘people’ on pages 47–48 ‘corporate governance’ on pages 22–23 
‘remuneration report’ on pages 29–34
risk
financial markets are cyclical
the ﬁnancial services industry is
undergoing rapid structural and
regulatory evolution
the integrity of our reputation is key 
to our ability to remain a trusted source 
of news and information
our customers demand 
high levels of service to help 
them perform effectively
we currently have both revenue 
growth and simpliﬁcation programmes
underway
continuing to drive cultural change and
attract and develop talented individuals 
is key to our success
impact
downturn in the ﬁnancial markets 
could make it more difﬁcult for us 
to achieve our ﬁnancial goals
we need to keep pace with structural
changes if we are to maintain a strong
market position
we need to protect our brand in 
order to sustain our credibility as 
a neutral supplier of content
we need to anticipate and respond 
to our customers’ needs if we are 
to improve our competitiveness
we must ensure that we can resource 
and complete both revenue growth and
simpliﬁcation initiatives so that we can
achieve our ﬁnancial targets
without the necessary skills and 
a faster more responsive company
culture we will ﬁnd it difﬁcult to achieve
our corporate potential
our ‘risk radar’ reviewed by the 
board captures key external and
internal risks that could affect reuters
ability to reach its full potential and 
the actions and plans in place to 
mitigate them
reuters group plc annual report and form 20f 2006
business review our challenges 
for more information about our approach to managing risk
see ‘statements of directors’ responsibilities and compliance’ on page 41
13 when change is a constant adaptability
carries a premium a stronger reuters has
emerged from a period of fundamental
change – in our products in how we 
serve our customers and in how we are
organised but the continuous and rapid
evolution of our markets means we 
must become even more agile to sustain 
a competitive edge greater focus and
radical simpliﬁcation are crucial objectives
for 2007 i am conﬁdent that tom glocer
and his team in partnership with the board
will address these challenges efﬁciently
in the same way companies must evolve 
with their markets business must evolve 
with society globalisation has driven
unprecedented wealth creation but not
without a price political economic social
and environmental imbalances threaten
global stability and the very conditions that
have allowed global business to ﬂourish 
society expects business to assume 
greater responsibility towards people 
and the communities in which it operates 
it is entitled to expect business leadership 
that combines optimum returns for
shareholders with responsibility for social
and environmental performance companies
are unlikely to succeed if society fails
the board must bring an external
perspective to the company t o do so 
the board must reﬂect the diversity of the
society in which the business operates 
i am proud of the range of experiences 
and backgrounds represented on the
reuters board in 2006 we announced that
nandan nilekani ceo of infosys would 
join the reuters board in january 2007
equally the board must continually scan the
external horizons in 2006 the board and
executive management met in palo alto
california to gain a ﬁrsthand understanding
of new technology trends and evolving
business models highperforming boards
need to evaluate their own performance
last year we completed a comprehensive
board effectiveness review and
implementing the recommendations is 
an important objective for 2007 
the reuters trust principles are at the heart
of our responsibility to society they commit
us to independence integrity and freedom
from bias in the gathering and dissemination
of news and information guided by these
principles i am conﬁdent we can provide the
growth our shareholders expect and fulﬁl
the role society demands they also attract
and motivate the outstandingly talented
people we need to build our future
niall fitzgerald
chairman
the continuous and rapid
evolution of our markets
means we must become 
even more agile to sustain 
a competitive edge
chairman’s statement
reuters group plc annual report and form 20f 2006
14 being on top of and responding 
to fastpaced change requires agility 
and imagination
the speed 
of change
reuters group plc annual report and form 20f 2006
15 business review
this page the space shuttle
discovery sits on the launch pad
at the kennedy space center
photographer rick wilking speed is the hallmark of 
today’s global ﬁnancial 
markets driven by new trading
technologies new regulations
and rapidly shifting market
structures markets are creating
and consuming more information
at an everincreasing rate
rising tension in middle east
the ﬁrst rocket attacks on the israeli 
city of haifa heighten fears about 
global security and energy supply
reuters is ﬁrst with the news
the story spreads across our networks 
to trading rooms worldwide markets 
react swiftly
13 july 2006
speed of change in the ﬁnancial world
reuters group plc annual report and form 20f 2006
16 stocks fall while bonds rise
stock markets around the world rapidly
begin to slide as ‘safe haven’ assets 
such as us treasury bonds climb
pump prices increase
fuel prices in several european 
countries are driven to record levels 
crude oil prices soar
oil surges to a high of 78 a barrel 
on worries about supply disruptions
as electronic trading gathers momentum
we are giving our customers new ways of
capturing competitive advantage 
in 2006 we launched
• reuters newsscope which codes and
delivers news stories in machinereadable
formats so they can be interpreted at high
speed by trading engines and used to
trigger decisions to trade 
• reuters t rading for exchanges which helps
brokers to ﬁnd the best counterparties for
their trades through our global network
“the simple issue is that electronic
trading is cheaper faster more
efﬁcient and less open to ‘market
abuse’ electronic trading can
handle greater volumes and
combines a lower cost base 
with genuine global distribution”
patrick l young odl monaco
almost 1 00000 updates 
a second are carried over 
our networks
reuters group plc annual report and form 20f 2006
business review 17 speed of change in the media world
reuters group plc annual report and form 20f 2006
18
0545
a reuters journalist
by the earthquake that
muzaffarabad
widespread destruction
reuters newsdesk
0603
images of
in india
0630
an image appears on
0642
a canadian blogger questions
is reaching the 
blogs appear
concerns over the
kashmir
0815
reuters
minister asking
reconstruction costs a
0845
the story is reported
in newspapers and online and
is broadcast worldwide as the commingling of professional and
amateur content reshapes the media world
reuters journalists continue to bring
something extremely important to each
story they cover they sift through the facts
provide perspective and give context 
they are committed to an editorial code 
and brand that stand for independence
integrity and freedom from bias
“we can see that the pipe of 
news content is now ﬂowing 
in both directions it ought 
to be possible to integrate
professional journalism with 
usergenerated content in a
valuable way for our audiences”
tom glocer ceo reuters
reuters group plc annual report and form 20f 2006
business review 19
takes photos of children orphaned
devastated the city of
demonstrating the
0551
the photos arrive at
children appear on a website
22 sites globally
the speed at which the aid
victims of the disaster
0803
six more
expressing their
humanitarian crisis in
quotes a pakistani
for an extra 800 million to cover
year on from the earthquake nandan m nilekani ceo infosys 
and nonexecutive director reuters 
gives his perspective on the opportunities
and challenges presented by globalisation
over the last few years reuters has
simpliﬁed and refocused its business 
it has opened content centres in
bangalore and gdansk it has shifted
development to bangkok and beijing 
and it has increased its focus on growth
markets such as india china the middle
east and eastern europe
global markets global talent
developing countries have become more
credible players in the global economy
together contributing more than half the
global gross domestic product it is a much
larger economic world with more places to
do business and also more competition
in addition to new customers there is a 
new pool of skilled workers in emerging
economies t en years ago few of these
groups were part of the global workforce 
the global distribution of revenue customers
and costs talent is changing and companies
have no choice but to hire a more diverse
global workforce this will be easier because
the world is increasingly wired 
increases in technology and regulations
as the cost of technology has plunged
dramatically its usage has soared emerging
nations are leaping past the 20th century 
and landing squarely in the 21st in four
years china will have more broadband
connections than there are us households 
as large new populations gravitate toward
the information highway there are new
expectations for information security and
privacy cutting across geopolitical
boundaries and leading to a plethora of
regulation highproﬁle regulations such as
markets in financial instruments directive
mifid in europe and regulation nms in
the us will bring about sweeping change in
the way companies like reuters look at their
business models and revenue streams 
these changes will require bold thinking 
and smart execution to operate successfully
in the years ahead
t ogether  these trends – emerging economies
shifting demographics increasing technology
and proliferating regulations – are ﬂattening
the business landscape
new challenges
most companies now recognise the new
challenges arising from these trends 
in particular the increasing competition
especially from industries and geographies
previously considered insigniﬁcant 
reuters trading business is facing challenges
from competition and changes in business
models exchanges are being ‘ democratised’
with regulation levelling the playing ﬁeld
making location almost irrelevant in the us
market regulations are driving some
investors to other continental exchanges
causing a structural shift in revenues in
addition as the types of instruments traded
on exchanges rise and transactions across
countries and markets rise there is a 
need for new kinds of information tools 
and solutions
progressive innovative companies are
adopting new strategies to address such
new opportunities and challenges i believe
that companies who want to win in this
ﬂattening world must shift their operational
priorities to make the most of the new
opportunities available to them 
and to keep ahead of the game 
we have to transform ourselves
constantly this requires bold thinking
and smart execution
speed of change in reuters
reuters group plc annual report and form 20f 2006
opposite page a bird ﬂies
past a giant globeshaped
building in shanghai china
photographer aly song
20 as its current it related initiatives evolve into
comprehensive global sourcing capabilities
reuters will beneﬁt from improved cost and
efﬁciency with the increase in competitive
intensity the ability to respond quickly to
changing customer behaviour will rise
correspondingly companies have to focus
on drawing market and operational insights
from information collected from their
operations and those of their partners 
accessing the global talent pool
equally important its recent global initiatives
also enable reuters to access the global
talent pool this last point is especially
important as industry after industry has
shown that as global locations such as asia
become global operations centres for
certain activities and functions a greater
proportion of the innovation comes from the
same regions investment in global talent
pools today paves the way for tapping them
for product and process innovation in years
to come 
as markets become increasingly price
driven rapid innovation is the key to
customer loyalty
reuters has made substantial strides in
becoming more focused and efﬁcient
the global trends driving the business world
are still in full swing over the next few years
as these trends further affect the business
landscape only companies that shift their
operational priorities will win in the ﬂat world
rapid
innovation
is the key 
to customer
loyalty
reuters group plc annual report and form 20f 2006
21 business review
operational shifts
reuters has already taken signiﬁcant steps 
in this direction it is moving software
development to bangkok and beijing
working to consolidate data centres from
250 down to 10 by 2010 and planning to
move to a common technology platform 
it is increasing capacity and efﬁciency
through new content management centres
in bangalore and gdansk 
further by focusing on the needs of markets
such as india china the middle east and
eastern europe reuters is ensuring that it
stays relevant to these growth markets
these operational shifts are positioning
reuters well for future growth and proﬁtability 
reuters datascope products which enable
computers to use realtime information for
algorithmic trading are an example of
innovative use of technology to meet the
needs of the more demanding ﬁnancial
services industry the role of the board – niall fitzgerald
chairman in discussion with rosemary
martin reuters general counsel and
company secretary 
rosemary niall when you became
chairman of reuters in 2004 you proposed a
set of principles to guide the reuters board
why did you do that and what are they
niall the board needed to reﬁne how it
worked together the company was in
transition from survival to restructuring 
and preparing for a new phase of growth
board membership style and focus needed
to change to be responsive to the challenges
ahead we needed a dialogue around the
board table about our role and how we
could work together more effectively we
agreed some working principles such as
limiting formal presentations and our desire
for short and sharp board papers we
needed our time and energy deployed on a
few forwardlooking issues of real substance
rosemary you say the principles are not a
strict set of rules and yet you are adamant that
board papers are kept concise and that board
time is not consumed by formal presentations
why is this so important to you
niall board time is limited and we have to
use our time smartly formal presentations
constrict dialogue and put walls around 
an issue the deal is that executives and
advisers coming to a board meeting can
assume that the directors have done their
prereading and therefore there is no need
to go over the background and the facts
these are communicated in advance of the
board discussion it is good discipline to be
concise distilling issues to their essence 
no guff just the issues 
but we can do better so this year we’ve
been working on improving the quality of
information that the board receives in part
in response to comments in the 2005 board
effectiveness review we’ve reﬁned the
monthly performance report to make it less
dense more sharply focused and forward
looking we still have some way to go
rosemary looking back over 2006 
what would you say were the main areas 
of attention for the reuters board
niall in 2006 beyond ‘business as usual’
items such as monitoring ﬁnancial and
operational performance succession
planning and approving the budget and
plan for the year ahead we focused on 
a number of signiﬁcant initiatives these
included the creation of fxmarketspace
acquisition of application networks inc
disposal of reuters interest in factiva and
negotiations with the trustees of reuters 
two uk ﬁnal salary pension schemes to
substantially fund the pension deﬁcit 
we also examined our preparedness for 
any signiﬁcant interruption to business such
as a ﬂu pandemic and reviewed an incident
in which reuters inadvertently published 
a photograph that had been digitally
manipulated by a freelance photographer
working for us in beirut
the audit committee was very busy with
sarbanesoxley and preparations for
compliance with section 404 of the act 
they briefed the full board regularly
in june the board met in palo alto california
to discuss strategy stepping outside our
norms gave us the chance to spend more
time with the executive management team
and together consider new developments in
technology and business models the visit
reinforced the importance of continuous
innovation and creative partnerships as 
asia is a growing source of technological
innovation and we are focused on growing
our business across this region the board 
is planning to visit asia during 2007
rosemary this leads us to the question 
of how you ensure the reuters board has the
right mix of directors to lead reuters in the
ﬁrst decade or so of the 21st century
niall i chair the nominations committee
which includes dick olver and ian strachan
we meet to review the structure size and
composition of the board we have a view 
as to the ideal blend of experience and
expertise these include ﬁnancial services
technology media government and
regulatory affairs general commercial
acumen a mix of geographic experience
knowledge of reuters industry sectors and
an understanding of our customers
the strength of the group’s corporate
values its reputation and its ability to
deliver a successful business depend in
part on the effectiveness of its corporate 
governance system
22 interview with the chairman
reuters group plc annual report and form 20f 2006 governance
we identify which speciﬁc skills and
experiences individual directors have and 
we look for any gaps in 2005 we agreed it
would be advantageous to add a director
who is currently a chief executive and with
extensive knowledge of business in asia 
and of technology we were delighted when
nandan nilekani one of the founders of
infosys agreed to join reuters board from 
1 january 2007
in addition the nominations committee has
to ensure there are robust succession plans
for board committees during the year dick
olver said he wanted to step down from 
the chairmanship of the audit committee 
a role he ﬁlled with distinction since 2000 
i discussed with board colleagues the
appointment of lawton fitt as his successor
and this was unanimously approved by the
board in october continuity will be
provided as dick will remain a member of
the audit committee he is also remaining
reuters senior independent director
rosemary what about succession planning
for senior executive roles during 2006 there
have been several changes in the senior
executive team in the last year what is the
board’ s role in relation to this
niall it’ s the chief executive’ s responsibility
to ensure the best senior executives are
appointed to help him manage the
company’ s business for many roles the
talent already exists within our ranks – 
for example it was pleasing to see the
promotion of mark redwood to become
head of the sales  trading division
michael peace to head of the research 
 asset management division and david
schlesinger to editorinchief it is also
important to bring in new talent to the ﬁrm 
last year stephen dando joined as group
hr director from the bbc roy lowrance as
chief t echnology ofﬁcer from capital one
gerry campbell as global head of search
and strategic development from aol and
lee ann daly as chief marketing ofﬁcer
from espn in march david craig joined us
from mckinsey as group strategy director 
the board’ s role is to oversee the quality of
management and the processes for ﬁnding
and developing outstanding talent we do
that by meeting regularly with managers
below board level and by reviewing twice 
a year the succession plans and talent
management process in 2006 it was agreed
that board members would each mentor 
one or more highpotential executives
rosemary one of the principles that you
have articulated for the board is the
requirement to maintain “a governance
framework that facilitates substance and not
merely form” what do you mean by this
niall ‘governance’ is much discussed but
often poorly understood the directors must
act in the longterm interests of shareholders
we will not be serving our shareholders 
well if we become myopically focused on
governance in a ‘box ticking’ way and fail to
look at the wider picture of how to capture
and build sustained shareholder value 
we need to use sound governance tools –
proper internal controls and processes a full
understanding of risk a rigorous approach 
to performance management insistence 
on transparency and integrity – to help us
create a highperforming company good
governance should be a powerful fuel for
growth i want reuters to use the principles 
of good governance in this way 
rosemary one ﬁnal question at the end of
2006 the new companies act was introduced
in the uk although it will take a while for 
the new law to be implemented in full do
you see it as requiring any major changes 
to the way reuters board operates today
niall i have no doubt a great deal will be
written and spoken about the implications 
of the new companies act for uk companies
there has already been much discussion
about the new requirement for directors to
have regard in their decision making to such
things as the impact on the environment and
the interests of employees all wellrun
companies focus on these and other issues
which are key to sustainable business
performance the companies act is about
codifying existing best practice into law
provided it is applied sensibly  little will
change inside the boardrooms of high
performance companies but let’ s see what
happens – and please no more boxes to tick 
reuters group plc annual report and form 20f 2006
23
“good governance should 
be a powerful fuel for
growth i want reuters to 
use the principles of good
governance in this way”
niall fitzgerald from the chairman’s 
note to the board
20 september 2004
we must be clear and agreed on the role 
of the board it is a unitary board with one
group sharing common objectives and
united in purpose the board does not run
the business but reviews how the business 
is run 
it does this by
• agreeing the strategic framework and
keeping it under vigorous review
• monitoring the implementation of strategy
through the operational plans
• focusing on longterm sustainable value
creation
• safeguarding the longerterm values of the
company including the brand and
corporate reputation
• overseeing the quality of management
and how it is maintained at world class
levels
• maintaining a governance framework that
facilitates substance and not merely form
• the overriding theme of the board should
be proﬁtable growth within an acceptable
risk proﬁle
the chairman’ s role is to lead the board in 
a manner that allows the ceo to run the
company effectively this demands skilful
motivation and management of the board to
build a cohesive team the chairman must
support and counsel the ceo and be the
ultimate judge as to his effectiveness 
this requires the correct balance between
detachment – thereby avoiding interference
– and being sufﬁciently engaged and
informed to know when to intervene the
chairman and ceo must work on a basis of
trust mutual respect and understanding
content
the board agenda must reﬂect its role 
this will require at each meeting
• report on operational and ﬁnancial
performance and progress against plan
• update on markets competitors
customers and investors
• progress on strategic issues
• developments on important people issues
• review in depth one key strategic issue
• short presentation from one seniorhigh
potential leader
• other matters that the ceo believes
needs the engagement of the board
periodically the board will discuss
• the strategic framework
• the brand
• the principles
• people and succession plans
• longerterm scenario development
• reports from audit and remuneration
committees
• assessment of its own performance
information to the board will be
• timely – a week prior to the meeting
• concise – exceeding two pages by
exception
• open and transparent
we will work on the assumption that all
papers have been read and use our time for
debate and discussion formal presentations
to the board will be rare and usually
preceded by a background paper at the
end of each board meeting we will spend
ﬁve minutes to review the effectiveness of
the meeting 
style
board members should not intrude on the
management of the business but must
ensure that they are adequately informed 
to judge when intervention may be needed
our discussions should always be open
candid and trusting we must be prepared
to challenge confront disagree and probe
but always in a way that is constructive and
supportive of the business agenda nothing
should be left unsaid within a team that is
committed to team success consistent high
quality communication between the
executive and the board is essential
note to the board
reuters group plc annual report and form 20f 2006
24 25 governance
07 ed kozel
08 sir deryck maughan
09 nandan nilekani
10 ken olisa
11 dick olver
12 ian strachan
01 niall fitzgerald kbe 
02 t om glocer
03 david grigson
04 devin wenig
05 lawton fitt
06 penny hughes
for biographies of our directors see pages 26–27
nominations committee
niall fitzgerald chairman
ian strachan
dick olver
audit committee
lawton fitt chairman
dick olver
ken olisa
nandan nilekani
remuneration committee
ian strachan chairman
penny hughes
ed kozel
04 05 06
07 08
09
11 10 12
08
01 02 03
reuters group plc annual report and form 20f 2006
board  reuters group plc annual report and form 20f 2006
the directors and senior managers of reuters group at 9 march 2007 are
name position position held since
directors
niall fitzgerald kbe chairman director 2004 2003
thomas glocer ceo director 2001 2000
david grigson cfo director 2000
devin wenig coo director 2006 2003
lawton fitt director 2004
penelope hughes director 2004
edward kozel director 2000
sir deryck maughan director 2005
nandan nilekani director 2007
kenneth olisa director 2004
richard olver director 1997
ian strachan director 2000
senior managers group leadership team
chris ahearn president reuters media 2002
john alcantara global head of service operations 2005
david craig group strategy director 2007
lee ann daly chief marketing officer 2007
stephen dando group human resources director 2006
joerg floeck managing director – europe middle east  africa 2006
christopher hagman managing director global sales  service operations 2001
alex hungate managing director asia 2006
david lister chief information officer 2004
roy lowrance chief technology officer 2006
rosemary martin general counsel and company secretary 2003 1999
peter moss global head of enterprise solutions 2003
michael peace global head of research  asset management 2006
mark redwood global head of sales  trading 2006
jon robson president focus group accounts and president americas 2006
david schlesinger editorinchief 2007
simon walker director of corporate affairs 2003
26 directors and senior managers
directors
niall fitzgerald kbe – chairman
chairmanofthenominationscommittee
heischairmanofthenelsonmandelalegacy
trustukandchairmanoftheboardof
trusteesofthebritishmuseumniallcochairs
the investment climate facility icf for africa
and is a trustee of the leverhulme trust niall
chairs the international business council of
the world economic forum and is a member
of the world economic forum foundation
board he is a member of various advisory
bodies including the president of south
africa’ s international investment advisory
council the advisory board of t singhua
university and the advisory board of spencer
stuart he is a senior advisor to morgan
stanley international his past appointments
include chairman of the conference board
2003–2005 and cochairman of the
transatlantic business dialogue 2004–2005
nonexecutive director of merck 2000–2003
ericsson 2000–2002 bank of ireland
1990–1999 and the prudential corporation
1992–1999 president of the advertising
association 2000–2005 age 61
thomas tom glocer – ceo
previously ceo of reuters information
2000 and president and senior company
officer reuters america 1998–2000
appointed ceo reuters latin america 
in 1997 after serving in reuters legal
department from 1993 formerly practised
law in new york paris and tokyo with davis
polk  wardwell member of the corporate
council of the whitney museum the
madison council of the library of congress
the leadership champions group
education of business in the community
the advisory board of the judge institute 
of cambridge university and the corporate
advisory board of the tate former non
executive director of instinet group age 47
david grigson – cfo
joined reuters in august 2000 from emap
plc where he was group finance director
and chairman of emap digital he is a
qualified chartered accountant david sits
on the implementation board and culture
board of legacy 2020 formerly held senior
finance roles in the uk and us at saatchi
and saatchi plc 1984–1989 held a
number of financial positions at esso uk
1980–1984 former nonexecutive director
of instinet group and former chairman of
radianz age 52
devin wenig – coo
previously president business divisions
2003–2006 president investment banking
 brokerage services 2001–2003 joined
reuters in 1993 as corporate counsel
reuters america and held a number of
senior management positions before being
appointed president investment banking
 brokerage services in january 2001 also
a nonexecutive director of nastech
pharmaceutical company and a former non
executive director of instinet group age 40
lawton fitt – nonexecutive director
chairman of the audit committee non
executive director of ciena corporation
and citizen communications senior
adviser and member of the board of
advisers at gsc partners director and
trustee of reuters foundation previously a
partner and managing director of goldman
sachs group inc trustee of several notfor reuters group plc annual report and form 20f 2006
profit organisations including contemporary
arts centres in new york and berlin former
secretary chief executive of the royal
academy of arts age 53
penelope penny hughes – 
nonexecutive director
member of the remuneration committee
nonexecutive director of the gap inc
skandinaviska enskilda banken home retail
group plc molton brown limited and a
member of the advisory board of
bridgepoint capital former president coca
cola great britain and ireland former non
executive director of bodyshop international
plc 1994–2000 enodis plc 1996–2001
sc johnson 2002–2004 webangel
2000–2003 trinity mirror plc 1999–2005
and vodafone plc 1998–2006 age 47
edward ed kozel – 
nonexecutive director
member of the remuneration committee
chief executive of skyrider also a non
executive director of yahoo and network
appliance former nonexecutive director
of cisco systems inc 2000–2001 where 
he worked from 1989–2000 in a number of
roles including chief technology officer
and senior vice president for business
development also a former nonexecutive
director of tibco software inc 2000–2001
and narus inc 1999–2003 prior to 1989 he
worked with sri international in california
age 51
sir deryck maughan – 
nonexecutive director
managing director of kohlberg kravis
roberts  co and chairman of kkr asia
he was formerly chairman and ceo of
citigroup international and salomon
brothers inc he is a nonexecutive director
of glaxosmithkline plc and blackrock inc
as well as serving on the boards of
directors of carnegie hall lincoln center
and nyu medical center he served as vice
chairman of the new york stock exchange
from 1996 to 2000 age 59
nandan nilekani – 
nonexecutive director
member of the audit committee chief
executive of infosys a world leading
provider of it consulting and services since
march 2002 nandan was one of the
founders of infosys and has served as a
director of the company since 1981 he is 
a member of the world economic forum
foundation board vicechairman of the
conference board member of the national
knowledge commission india member of
national advisory group on ecommerce
cochairman of the iit bombay heritage
fund and a member of the board of
governors of iit bombay former chairman
of the government of india’s it task force
for the power sector former member of 
the subcommittee of the securities and
exchange board of india and former
member of the reserve bank of india’s
advisory committee on corporate
governance age 51
kenneth ken olisa – 
nonexecutive director
member of the audit committee founder
and chairman of restoration partners
limited and a nonexecutive director of
biowisdom and open text corporation
former chairman 2000–2006 and ceo 
of interregnum plc which he founded in
1992 he worked for wang laboratories
1981–1992 and was general manager of
wang europe africa and the middle east
1990–1992 his career began at ibm
1974–1981 former nonexecutive director
of various information technology
companies and former postal services
commissioner he is a liveryman of the
worshipful company of information
technologists a fellow of the british
computer society chairman of homeless
charity thames reach a governor of the
peabody trust and a director and trustee
of reuters foundation age 55
richard dick olver – 
nonexecutive director
member of the audit committee member
of the nominations committee and senior
independent director chairman of bae
systems plc since july 2004 he worked 
for bp plc and was deputy group chief
executive 2003–2004 and ceo of bp
exploration  production division
1998–2002 and former deputy chairman
of tnkbp in russia a fellow of the royal
academy of engineering and a member of
the trilateral commission a guardian of
new hall school age 60
ian strachan – nonexecutive director
chairman of the remuneration committee
member of the nominations committee
nonexecutive director of transocean inc
johnson matthey plc xstrata plc and
rolls royce group plc former chairman
of instinet group former nonexecutive
director of harsco corporation deputy
chairman of invensys plc 1999–2000 and
chief executive officer of btr plc
1996–1999 former deputy chief
executive officer 1991–1995 and chief
financial officer of rio tinto plc
1987–1991 also a former nonexecutive
director of commercial union plc
1991–1995 age 63
senior managers
chris ahearn – president reuters media
chris joined reuters in 2001 as executive
vice president in charge of the research 
 advisory business he was appointed to
his current position in 2002 prior to joining
reuters chris worked in investment
banking at jp  morgan and credit suisse
first boston he sits on the board of
directors of times global broadcasting 
co limited pluck corporation and 
the kitchen age 40
john alcantara – 
global head of service operations
john joined reuters in 1986 after ten years
at cable  wireless john has held a
number of product management and
business management roles in reuters 
he was the managing director of reuters
iberia and later managing director for
reuters uk and ireland until 2005 when 
he took up his current role age 52
david craig – group strategy director
david joined reuters in march 2007 from
mckinsey and company where he was
both a partner in the global business
technology office and worked in the media
team he has extensive experience of
working with clients across many industries
in particular wholesale and corporate banks
and trading institutions on strategy
information technology and operational
performance improvement prior to joining
mckinsey david was a senior principal at
ams where he developed risk and trading
systems age 37
lee ann daly – chief marketing officer
lee ann joined reuters in january 2007
she was previously executive vice president
marketing for espn inc prior to joining
espn lee ann served in various
management and planning roles at
ammirati purislintas and grey advertising
she was cofounder and executive producer
of an awardwinning humourbased radio
production company which directly serviced
top brands and agencies she was a director
and president of the board of the american
marketing association in new york age 45
27 governance reuters group plc annual report and form 20f 2006
28
senior managers continued
stephen dando – 
group human resources director
stephen joined reuters in 2006 in his
current role prior to joining reuters
stephen was director bbc people and a
member of the bbc’s executive committee
and executive board for five years he held
various appointments at diageo over a 12
year period including global hr director
guinness age 45
joerg floeck – managing director
europe middle east  africa
joerg joined reuters in 1990 and is based
in geneva he has held various senior sales
and general business management
positions in germany austria italy united
states and the uk before being appointed
to his current post in june 2006 prior to
joining reuters joerg worked in the
financial industry specialising in it age 45
christopher hagman – 
managing director global sales 
 service operations
christopher joined reuters in 1987 based
in sweden and held various senior sales
and general business management
positions in sweden the netherlands and
the uk before being appointed to his
current post in april 2001 christopher was
appointed as a member of the executive
board of the community of european
management schools and international
companies in december 2005 age 48
alex hungate – managing director asia
alex joined reuters in a business
development role in 1993 he started and
managed new media businesses in the
early days of the world wide web he went
on to become coceo reuters america
then president focus group accounts and
most recently chief marketing officer for
reuters he took up his current role in
january 2006 prior to reuters alex worked
as a media analyst at booz allen 
hamilton he graduated with high
distinction from harvard business school 
in 1993 he was a board director of factiva
until reuters stake was sold to dow jones
on 15 december 2006 age 40
david lister – chief information officer
david joined reuters in 2004 prior to
joining reuters david held senior it
leadership roles at boots group glaxo
wellcome and diageo after a period of
management consultancy with coopers 
 lybrand he is a member of several it
professional bodies and consultative
boards age 48
roy lowrance – 
chief technology officer
roy joined reuters in 2006 as chief
technology officer a role focused on
developing competitive technology
strategies that help to drive and support
the company’s business strategies prior to
joining the company he held technology
management positions at capital one and
fleet financial group and was a partner 
at the boston consulting group age 56
rosemary martin – general counsel 
and company secretary
rosemary joined reuters in 1997 as deputy
company secretary and became company
secretary in 1999 appointed general
counsel in 2003 rosemary has been the
director of reuters foundation since 2000
former partner at mayer brown rowe 
maw for nine years nonexecutive director of
hsbc bank plc member of the uk listing
authority advisory committee age 46
peter moss – 
global head of enterprise solutions
peter joined reuters in 1989 based in the
uk and held various product management
marketing sales management strategy and
business management positions across
reuters before being appointed to his
current post in september 2003 before
joining reuters peter worked in the
information technology industry age 47
michael peace – global head of
research  asset management
michael joined reuters in 1987 on the
management graduate development
scheme and held a variety of sales
marketing and management positions in
the uk europe asia and the us before
being appointed to his current position 
in september 2006 michael was chief
executive of lipper a reuters company
from 2001 prior to joining reuters michael
held positions with lloyds international
bank in spain and as a sponsored
undergraduate with shell age 43
mark redwood – 
global head of sales  trading
mark joined reuters in december 2002
following the acquisition of avt
technologies limited a specialist in fx
trading technologies where he was ceo
prior to his current appointment mark was
responsible for reuters transactions services
across all asset classes before founding
avt mark worked for jp morgan in london
from 1983 to 1989 where he held a number
of trading positions in fixed income and
exchange traded derivatives age 46
jon robson – president focus group
accounts and president americas
jon leads reuters business in the united
states south america and canada and has
global business responsibility for reuters
largest clients worldwide before joining
reuters jon worked at bis banking systems
now misys telerate and dow jones
markets in 1997 jon founded moneyline
which acquired telerate in 2001 to form
moneyline telerate which was
subsequently acquired by reuters age 48
david schlesinger – editorinchief
david joined reuters in 1987 as a journalist
in hong kong after working as a teacher
and a reporter for other publications he
ran reuters editorial operations in taiwan
china the greater china region and the
americas before becoming global
managing editor  head of editorial
operations in 2003 he took up his current
role in january 2007 age 46
simon walker – 
director of corporate affairs
simon joined reuters in 2003 prior to
joining reuters simon was communications
secretary at buckingham palace director of
communications at british airways plc and
special adviser to the prime minister in the
downing street policy unit simon is a
trustee of the charity uknz link
foundation the uk jamestown foundation
and a member of the european policy
forum’s advisory committee he is a
director and trustee of reuters foundation
and a member of the better regulation
commission age 53
susan taylormartin stepped down as a
member of the group leadership team
glt at the end of 2006 to take up her new
role as managing director and senior
company officer for uk  ireland from
1 january 2007 geert linnebank also
stepped down from glt to take up his new
role as senior adviser to the ceo with
effect from 1 january 2007 david craig
joined reuters as group strategy director
and a member of glt in march 2007
directors and senior managers continued reuters group plc annual report and form 20f 2006
29 governance
remuneration policy
the remuneration committee believes that reuters remuneration
policy should be marketcompetitive business performancerelated
and supportive of shareholders’ interests with these considerations 
in mind
• the reward structure for executive directors is designed to attract
motivate and retain highcalibre individuals capable of successful
leadership
• the committee aims to ensure that the majority of executive
remuneration is variable and performancerelated with a significant
portion linked to share price performance and delivered in shares
this policy will apply in 2007 and is expected to continue in future years
remuneration committee
the committee is chaired by ian strachan and the other members are
ed kozel and penny hughes all members of the remuneration
committee have been determined by the board to be independent
the company secretary is secretary to the remuneration committee
the committee met six times in 2006 all members were present at
each meeting except penny hughes and ed kozel who were each
absent from one meeting
the committee operates under formal terms of reference and under
the powers delegated to it by the board the duties of the committee
include
• determining the company’s framework of executive remuneration
and its cost having a pragmatic regard to the company’s position
with respect to other companies
• determining on the board’s behalf specific remuneration packages
for each of the executive directors the chairman and such other
members of the glt as it is designated to consider
• recommending on the board’s behalf the ordinary remuneration of
the nonexecutive directors in respect of remuneration permitted to
be set by the directors by the company’s articles of association to
be approved by the shareholders at the agm
• determining on the board’s behalf any other remuneration issues
which affect the interests of shareholders in particular remuneration
or option plans using shares determining the targets for incentives
plans determining the provision of benefits and settlement of other
provisions under the terms of the service agreements or otherwise
of executive directors where these are stated as being at the
discretion of the board and
• keeping apprised of and advising the board of key changes in
employee benefit structures with the group
the committee’s terms of reference can be found at
aboutreuterscomcsrcorporategovernancecommitteesasp
the chairman ensures that the company’s principal shareholders are
kept informed as to remuneration matters as appropriate
the committee has appointed towers perrin to provide it with
independent advice towers perrin also provides industry and
comparative salary data to reuters management the committee has
also consulted with the company’s chairman and ceo neither of
whom has been present at any meeting to decide matters relating to
their own compensation or contracts and with the group human
resources director and the global head of performance and reward
executive directors
there are four key elements of executive compensation
• basic salary
• annual bonus
• awards under equity incentive plans
• pension and other benefits
the following bar chart shows the relative weight of basic salary
annual bonus and the expected value of equity incentive plans for
each executive director in 2006
as shown in the chart above approximately three quarters of
executive reward package is performancerelated
basic salary
the main reference point in setting executive directors’ salaries is
companies in the ftse100 other than the five largest companies in
this group and the five smallest these companies have been selected
to provide a stable comparator group which is relevant to the
company’s position in the market this group is reviewed annually to
confirm its appropriateness
salaries earned in 2006 are shown in the table below
2006
salary 
£000’s
tom glocer 842
david grigson 469
devin wenig 454
annual bonus
the committee sets performance targets annually tom glocer is
entitled to a maximum bonus of 150 of base salary and david
grigson and devin wenig are each entitled to a maximum bonus of
125 of base salary the executive directors’ annual bonus potential
will remain the same in 2007
for 2006 the performance targets were focused 80 on financial
performance trading profit
1
 revenue and free cash flow and 20 on
customer satisfaction measures in february 2007 the committee
reviewed 2006 performance against the specified targets and
determined that the executive directors had earned bonuses of 91
of bonus potential
1 trading profit is calculated by excluding the following from operating profit from continuing
operations restructuring charges associated with fast forward and acquisitions impairments
and amortisation of intangibles acquired via business combinations investment income
profits from disposals of subsidiaries and fair value movements trading margin is trading
profit expressed as a percentage of revenue
basic salary annual bonus lti
tom glocer
david grigson
devin wenig
0 25 50 75 100
remuneration report reuters group plc annual report and form 20f 2006
30 remuneration report continued
the 2006 bonus awards are shown in the table below
2006
bonus 
£000’s
tom glocer 1149
david grigson 534
devin wenig 516
for 2007 the performance targets will be focused solely on financial
performance trading profit revenue and free cash flow there is a
profit threshold based on trading profit below which no bonuses will
be paid the remuneration committee reviews the business plan and
establishes this threshold each year
equity incentive plans
overview executive directors and other senior managers are entitled
to participate in the sharerelated incentive schemes operated by the
company as detailed below the committee reviews the schemes
annually to ensure that they reflect best practice and are aligned to
the company’s business plan
the committee has reconfirmed its 2005 decision to continue to
operate the long term incentive plan ltip and the discretionary
share option plan dsop for executive directors awards are subject
to specific performance conditions in 2006 the committee decided to
increase the proportion of performance shares and to reduce the
number of share options awarded
ltip reuters has operated the current longterm incentive plan since
1998 contingent share awards are made annually to executive
directors and to those senior managers most accountable for
corporate performance before 2006 the vesting of awards was based
wholly upon reuters total shareholder return tsr relative to other
ftse100 companies
since 2006 half of the award has been based on reuters tsr relative
to other companies in the ftse100 and half is based on the aggregate
level of adjusted profit before tax
1
pbt achieved over the three year
performance period these measures were selected because growth in
profit is in itself a key element of the company’s long term strategy and
relative tsr provides a market measure of the company’s success in
delivering against its strategy
tsr performance is measured independently prior to review by the
committee and the committee annually reviews the comparator
group whilst endorsing relative tsr as a measure the remuneration
committee recognises that reuters does not fall naturally into any one
of the existing ftse industrial sectors the committee continues to
believe that the ftse100 rather than one individual sector or a
bespoke peer group remains the most appropriate peer group for
comparison
in respect of the tsr performance test no shares vest if reuters tsr is
below the median of the comparator group at median one third of
the shares vest and for upper quartile performance all shares vest
there is proportionate vesting of awards if reuters tsr falls between
the median and the upper quartile
vesting of 50 of the ltip awards is subject to the pbt test and
depends upon the level of pbt achieved by reuters over the whole of
the performance period the remuneration committee sets a range of
pbt performance at the beginning of each performance period taking
into account the plans and prospects for the business and shareholder
expectations the minimum level at which one third of the awards will
vest will be at least equal to the level which would be achieved with
an 8 compound annual growth rate over the performance period
the maximum pbt level at which all shares will vest represents a
challenging but potentially achievable target for the business shares
vest on a proportionate basis if actual pbt falls between the minimum
and maximum of the preset range
the 2006 awards which are subject to the performance conditions
detailed above for tom glocer david grigson and devin wenig were
500000 shares 200000 shares and 250000 shares respectively
in 2007 the awards for tom glocer david grigson and devin wenig
which are also subject to the performance conditions detailed above
will be 500000 shares 200000 shares and 300000 shares respectively
dsop a global discretionary stock option plan was adopted by the
committee in october 2000 and approved by shareholders in april
2001 it aims to reward growth in earnings and in the share price since
2004 participation has been confined to executive directors and
members of the senior management team
the committee divides participants’ annual entitlements into two
awards normally made following the announcement of preliminary
annual and halfyearly results
as a result of changes made in 2006 which apply to 2006 and future
awards options only vest to the extent that the following conditions
are met over the three years following grant
• minimum 6 a year growth in adjusted eps
2
will be required for 50
of options to vest
• 9 a year growth will be required for 100 of options to vest
• between 6 and 9 growth options will vest on a proportionate basis
executive directors are only allowed to exercise 50 of the vested
options after the initial three year period the remaining options will
only be exercisable in two equal tranches one and two years later
the 2006 share option awards for tom glocer david grigson and
devin wenig were 1250000 options 500000 options and 650000
options respectively
in 2007 the share option awards for tom glocer david grigson and
devin wenig will be 1250000 options 500000 options and 750000
options respectively
all employee savings plans
executive directors in common with other employees may participate
in the company’s savingsrelated share option arrangements for uk
and usbased employees this takes the form of a save as you earn
plan for the 2006 offer the fixed monthly saving amount was set at a
maximum of £100 per month with a three year savings period
personal shareholding policy
the company’s personal shareholding policy requires each executive
director to build and maintain a personal equity stake worth twice his
basic salary within five years all executive directors are above or are
approaching this level of personal shareholding
1 adjusted profit before tax is calculated as profit before tax from continuing operations before
impairments and amortisation of business combination intangibles investment income profit
on disposals and fair value movements
2 adjusted eps is calculated as basic eps from continuing operations before impairments and
amortisation of intangibles acquired via business combinations investment income fair value
movements disposal profitlosses and related tax effects reuters group plc annual report and form 20f 2006
31 governance
performance graph
reuters tsr for the five years to 31 december 2006 compared with the
return achieved by the ftse100 index of companies is shown below
as reuters is a member of the ftse100 the committee believes it is
the most appropriate market index for comparison
the calculations assume the reinvestment of dividends
pensions
all executive directors participate in defined contribution pension
arrangements
tom glocer participates in reuters us pension arrangements and is
entitled to a pension allowance of 25 of his base salary he is entitled
to a lump sum deathinservice benefit whilst in service of four times
basic salary
david grigson is a member of the reuters retirement plan in the uk
and is entitled to a contribution in respect of pension benefits equal to
24 of salary up to a cap of £108600 he is entitled to a lump sum
deathinservice benefit whilst in service of four times basic salary
devin wenig participates in reuters us pension arrangements and is
entitled to a pension allowance of 6 of his base salary he is entitled
to a lump sum deathinservice benefit of 1 million
other benefits
market practice noncash benefits are provided to executive directors
and the chairman as shown on page 32 all executive directors receive a
company car or an allowance and private healthcare benefits disability
benefits are also provided to each executive director niall fitzgerald
does not receive any death disability or other benefits under the terms
of tom glocer’s relocation agreement reuters provides accommodation
in the uk and pays home leave expenses for him and his family
service contracts
the company’s policy is for executive directors to have service
contracts with notice periods of not more than one year
notice to be given date of service contract
tom glocer by tom glocer 23 july 2001
90 days without cause
30 days with cause
by the company
30 days without cause
immediately with cause
devin wenig 12 months 17 february 2003
david grigson 12 months 21 june 2001
in each case the unexpired term of the contract is equivalent to the
notice period
in the event of companyinstigated termination amounts up to a
maximum of 12 months’ salary annual bonus and 12 months’ pension
contributions are payable in addition in the event of a nonfault
termination tom glocer retains the benefit of any outstanding share
plan awards as if his employment had not ceased tom glocer and his
family also retain the life assurance and private healthcare benefits
provided by reuters for one year following termination
on a change of control of the company all the executive directors
are entitled to terminate their contracts on one month’s notice unless
the acquiring party has within three months of the change of
control agreed to adopt and uphold the reuters trust principles
see page 146
all executive directors have contractual terms that limit the ability of
an executive director to work for a defined list of competitor
companies for a period of time these provisions are in place to
protect intellectual property and commercially sensitive information
policy on external appointments
reuters recognises that executive directors may be invited to become
nonexecutive directors of other companies or to become involved in
charitable or public service organisations and that these appointments
can broaden the knowledge and experience of directors to the benefit
of the company accordingly it is reuters policy to approve such
appointments provided there is no conflict of interest and the
commitment required is not excessive
devin wenig was the only executive director who received fees for an
external directorship during 2006 he received fees of 20250 4500
shares of restricted stock and 9500 options in his capacity as director
of nastech pharmaceutical company
chairman and nonexecutive directors
the chairman’s and the nonexecutive directors’ ordinary
remuneration is proposed by the board and approved by the
shareholders at the annual general meeting agm in determining
appropriate fee levels the board has regard to the remuneration
arrangements of chairmen and nonexecutive directors of other uk
listed companies of a similar size and complexity
as chairman niall fitzgerald receives an annual fee of £500000 this
fee is fixed until 1 october 2007 the company does not provide a
pension contribution to him
nonexecutive director appointments are detailed on page 38 
niall fitzgerald and the nonexecutive directors have letters of
engagement rather than service contracts none are eligible to
participate in executive share plans
current annual fee levels in respect of the nonexecutive directors are
shown in the table below
2006 
fees
£000’s
basic 50
senior independent director 5
chairing the audit committee 15
chairing the remuneration committee 10
chairing the nominations committee 5
1
1 niall fitzgerald has waived his £5000 nominations committee chairman fee
0
jan 02 jan 03 jan 04 jan 05 jan 06 dec 06
140
35
70
105
reuters ftse reuters group plc annual report and form 20f 2006
32 remuneration report continued
directors’ remuneration for 2006 audited
the disclosures required by part 3 of schedule 7a to the companies act 1985 ‘the auditable part’ are contained within the following sections 
of the remuneration report
2006 2005
compensation
salary for loss
fees bonus benefits
1
allowance
2
of office total total
£000 £000 £000 £000 £000 £000 £000
niall fitzgerald kbe
34
500 – 3 – – 503 523
lawton fitt 53
6
–– 35
5
– 88 75
penny hughes 50 –––– 50 50
ed kozel 50 – – 35
5
– 85 80
sir deryck maughan 50 – – 20
5
– 70 14
ken olisa
16
50 –––– 50 51
dick olver 68
7
–––– 68 70
charles sinclair
15
na – – – – na 55
ian strachan 60
8
–––– 60 246
13
tom glocer
14
842 1149 274
9
– – 2265 1966
david grigson 469 534 4
10
80
10
– 1087 839
devin wenig 454 516 20
11
11
11
– 1001 639
total emoluments of directors
12
2646 2199 301 181 – 5327 4608
notes
all amounts have been rounded up to the nearest thousand
the following conversion rate was used us182 £1 this was the average rate in effect during 2006
1 items included under benefits are those provided as goods and services received during the year
2 items included under allowances are contractual benefits which are paid in cash rather than as goods and services during the year
3 noncash benefits received by niall fitzgerald consist of chauffeur benefits of £2120
4 niall fitzgerald has waived his £5000 nominations committee chairman fee
5 the £35000 paid to lawton fitt and ed kozel and £20000 to sir deryck maughan represent travel allowances to attend uk board meetings
6 fees paid to lawton fitt include £2154 in respect of her position as chairman of the audit committee from 9 november 2006
7 fees paid to dick olver include £12829 in respect of his position as chairman of the audit committee until 9 november 2006 and his fee of £5000 in respect of his position as the senior
independent director
8 fees paid to ian strachan include £10000 in respect of his position as chairman of the remuneration committee
9 noncash benefits received by tom glocer included accommodation costs of £210085 company car and healthcare benefits totalling £29217 longterm disability insurance of £2500 and family
travel of £31219
10 noncash benefits received by david grigson included healthcare benefits of £1935 and longterm disability insurance of £1400 cash allowances consisted of a car allowance of £7420 and a
retirement allowance of £72180
11 noncash benefits received by devin wenig consisted of healthcare benefits of £19757 cash allowances consisted of a car allowance of £10549 devin wenig’s salary is paid in us dollars and the
total amount reflected in the table is contractually split between his role as executive director and chief operating officer
12 the total aggregate emoluments for the directors for the period 1 january 2006 to 30 december 2006 were £53m the total emoluments for 2005 were £46m
13 in 2005 the fees paid to ian strachan included 350000 in respect of his position as a nonexecutive director chairman of instinet group £50000 in respect of his position as nonexecutive director
and £4489 as chairman of the remuneration committee from 20 july 2005
14 during the year a group company settled certain personal expenses on behalf of tom glocer the amount due from tom glocer at 31 december 2006 which was the maximum outstanding during
the year was £3720 no interest was charged tom glocer repaid the amount after year end
15 charles sinclair resigned as a director on 6 december 2005
16 £8333 of ken olisa’s nonexecutive director fee was paid directly to interregnum plc
other senior managers’ remuneration
2006 2005
compensation
salary for loss
fees bonus benefits allowance of office total total
£000 £000 £000 £000 £000 £000 £000
other senior managers as a group 17 persons 2005 6 persons 3247 3304 212 256 – 7019 4616
notes
all amounts have been rounded up to the nearest thousand
the following conversion rates were used us 182 £1 swiss franc 23 £1 hong kong 1418 £1 these were the average rates in effect during 2006 reuters group plc annual report and form 20f 2006
33 governance
company
contribution
in respect
of period
age £000
tom glocer 47 214
david grigson 52 30
devin wenig 40 28
directors’ pensions audited
tom glocer david grigson and devin wenig participate in defined
contribution pension arrangements tom glocer participates in reuters
us pension arrangements and is entitled to a pension allowance of
25 of his base salary during 2006 and 2007 he is entitled to a lump
sum deathinservice benefit of four times basic salary
david grigson is a member of the reuters retirement plan in the uk
and is entitled to a contribution in respect of pension benefits equal 
to 24 of salary up to a salary cap of £108600 he is entitled to a 
lump sum deathinservice benefit of four times basic salary
devin wenig participates in reuters us pension arrangements and is
entitled to a pension allowance of 6 of his base salary he is entitled
to a lump sum deathinservice benefit of 1 million
contributions and allocations including the cost of life cover in
respect of these directors in 2006 were
the information shown complies with requirements under both the
uk listing authority and the directors’ remuneration report
regulations 2002
the total amount of contributions or accruals made in 2006 to provide
pension and similar benefits for the directors was £395854 2005
£307310 and for the executive directors and the other senior
managers as a group was £1178386 2005 £847251
these aggregate figures also include an accrual of £124000 and
£139000 respectively for the investment returns within the us
executive pension arrangements these investment returns are
calculated based on each individual’s notional fund choices made by
reference to actual investment funds and the actual investment returns
achieved on these funds
directors’ interests in longterm plans audited
number at number at
1 january market market 31 december
2006 number price per number price per number number 2006
or later granted share at vested share at released lapsed or earlier end of
date of date of during grant during vesting during during date of qualifying expiry
plan award appointment period pounds period date period
4
period departure period date
tom glocer ltip
12
25062001 174451 – – – – – 174451 – 31dec05 01jan06
20022002 234974 – – – – – – 234974 31dec06 01jan07
24022003 1731277 – – – – – – 1731277 31dec07 01jan08
23022004 544094 – – – – – – 544094 31dec06 01jan07
11032005 417228 – – – – – – 417228 31dec07 01jan08
15032006
3
– 500000 £393 – – – – 500000 31dec08 01jan09
total 3102024 500000 – – – – 174451 3427573
devin wenig prsp
12
29032001 20704 – – – – – 20704 – 31dec05 01jan06
ltip
12
25062001 2295 – – – – – 2295 – 31dec05 01jan06
20022002 22047 – – – – – – 22047 31dec06 01jan07
24022003 200000 – – – – – – 200000 31dec07 01jan08
23022004 200000 – – – – – – 200000 31dec06 01jan07
11032005 163468 – – – – – – 163468 31dec07 01jan08
15032006
3
– 250000 £393 – – – – 250000 31dec08 01jan09
total 608514 250000 – – – – 22999 835515
david grigson ltip
12
25062001 26294 – – – – – 26294 – 31dec05 01jan06
20022002 37205 – – – – – – 37205 31dec06 01jan07
24022003 200000 – – – – – – 200000 31dec07 01jan08
23022004 200000 – – – – – – 200000 31dec06 01jan07
11032005 163468 – – – – – – 163468 31dec07 01jan08
15032006
3
– 200000 £393 – – – – 200000 31dec08 01jan09
total 626967 200000 – – – – 26294 800673
notes
1 see performance conditions attached to ltip awards as described on page 30 above
the prsp plan operated from 1995 to 2001 and targeted senior executives not participating in the ltip devin wenig held awards granted before he became an executive director all outstanding
awards have now lapsed the performance condition was the same as for ltip  although vested shares could be released three years after grant
2 ltip 2001 and prsp 2001 awards are available for exercise immediately on vesting the qualifying period may be extended by up to two years where vesting does not occur or is only partial after the
initial threeyear period ltip awards to executive directors prior to 2004 are subject to a retention period of two years from vesting save that this is reduced to one year where the performance
period has been extended to five years for awards made in or prior to 2003 the plan permits the measurement period to be extended by up to two years under a retesting provision for ltip
awards made from 2004 onwards no retesting is permitted
ltip 2001 and prsp 2001 did not meet performance conditions and therefore lapsed had they vested they would have been exercisable from 1 january 2006
3 2006 awards are described on page 30
4 subject to performance conditions being met share awards are due for release as soon as possible after vesting subject to any restricted period reuters group plc annual report and form 20f 2006
senior managers’ interests in longterm plans audited
number at market number at
1 january market price per 31 december
2006 number price per number share at number number 2006
or later granted share at vested vesting released lapsed or earlier end of
date of date of during grant during date during during date of qualifying expiry
plan award appointment period pounds period pounds period
5
period departure period date
other senior 
managers as a 
group 17 persons 
2005 6 persons
6
prsp
12
29032001 13884 – – – – – 13884 – 31dec05 01jan06
ltip
12
25062001 2602 – – – – – 2602 – 31dec05 01jan06
20022002 97369 – – – – – – 97369 31dec06 01jan07
24022003 807463 – – – – – – 807463 31dec07 01jan08
23022004 407814 – – – – – – 407814 31dec06 01jan07
03122004 92368 – – – – – – 92368 31dec06 01jan07
11032005 461472 – – – – – – 461472 31dec07 01jan08
15032006 268146 368208 £393 – – – – 636354 31dec08 01jan09
02082006 – 64000 £393 – – – – 64000 31dec08 01jan09
rsp
3
27082004 70647 – £321 21507 £395 21507 – 49140 27aug06 27aug08
03122004 25857 – £389 8619 £450 8619 – 17238 03dec06 03dec08
11032005 159347 – £419 1838 £392 1838 – 157509 11mar06 11mar09
02082005 19632 – £389 4908 £387 4908 – 14724 02aug06 02aug09
15032006 264855 11648 £393 – – – – 276503 15mar07 15mar10
abpsp
4
11032005 417 – £419 417 £392 417 – – 11mar06 11mar06
total 2691873 443856 – 37289 37289 16486 3081954
notes
1 see performance conditions attached to ltip awards as described on page 30 above
the prsp plan operated from 1995 to 2001 and targeted senior executives not participating in the ltip  all outstanding awards have now lapsed the performance condition was the same as for ltip 
although vested shares could be released three years after grant
2 ltip 2001 and prsp 2001 awards are available for exercise immediately on vesting the qualifying period may be extended by up to two years where vesting does not occur or is only partial after the
initial threeyear period for awards made in or prior to 2003 the plan permits the measurement period to be extended by up to two years under a retesting provision for ltip awards made from
2004 onwards no retesting is permitted
ltip 2001 and prsp 2001 did not meet performance conditions and therefore lapsed had they vested they would have been exercisable from 1 january 2006
3 the restricted share plan was introduced in 2004 restricted shares will not normally be granted for longterm incentive purposes to executive directors or members of the glt the indicated awards
were made prior to the appointment of the relevant individuals as glt members awards are normally granted with a four year vesting period vesting 25 each year therefore 25 vested in 2006
on the anniversary of the date of grant if this date fell on a nontrading date the shares vested at the next available trading date
4 the annual bonus profit sharing plan was introduced in 2004 to focus employees on reward for profit growth from 2005 any payments under the plan are made in cash to simplify the operation of
the plan glt members did not participate in this plan in 2006
5 subject to performance conditions being met share awards are due for release as soon as possible after vesting subject to any restricted period
6 other senior managers as a group were 6 persons at 1 january 2006 and were 16 persons at 31 december 2006 following the creation of the glt in june 2006 which replaced the group
management committee gmc
34 remuneration report continued reuters group plc annual report and form 20f 2006
35 governance
share options granted to directors audited
number at number at
1 january 31 december
2006 number number number number 2006
exercise or later granted vested exercised lapsed or earlier earliest
date of price date of during during during during date of exercise expiry
plan grant pounds appointment period period period
6
period departure date date
tom glocer
6
dsop
3
25062001 £862 565113 – – – 565113 – 25jun06 25jun11
20022002 £528 461295 – – – – 461295 20feb07 20feb12
02082002 £266 915654 – – – – 915654 02aug07 02aug12
24022003 £135 1307514 – 1307514 – – 1307514 24feb06 24feb13
04082003 £245 706594 – 706594 – – 706594 04aug06 04aug13
23022004 £407 789430 – – – – 789430 23feb07 23feb14
27082004 £321 1000928 – – – – 1000928 27aug07 27aug14
11032005 £419 719473 – – – – 719473 11mar08 11mar15
02082005 £389 774959 – – – – 774959 02aug08 02aug15
15032006
5
£393 – 625000 – – – 625000 15mar09 15mar16
02082006
5
£393 – 625000 – – – 625000 02aug09 02aug16
saye
4
16042003 £090 4200 – 4200 4200 – – 01jun06 01dec06
07042004 £314 1200 – – – – 1200 01jun07 01dec07
14042005 £333 569 – – – – 569 01jun08 01dec08
10042006
5
£314 – 1191 – – – 1191 01jun09 01dec09
total 7246929 1251191 2018308 4200 565113 7928807
devin wenig
6
dsop
3
27122000
23
£1139 6913 – – – – 6913 27dec01 27dec07
25062001
23
£862 9135 – – – – 9135 25jun02 25jun11
20022002
23
£528 25936 – 6484 – – 25936 20feb03 20feb12
02082002
23
£266 200000 – 50000 – – 200000 02aug03 02aug12
24022003 £135 200000 – 200000 – – 200000 24feb06 24feb13
04082003 £245 200000 – 200000 – – 200000 04aug06 04aug13
23022004 £407 122950 – – – – 122950 23feb07 23feb14
27082004 £321 155892 – – – – 155892 27aug07 27aug14
11032005 £419 281886 – – – – 281886 11mar08 11mar15
02082005 £389 303625 – – – – 303625 02aug08 02aug15
15032006
5
£393 – 325000 – – – 325000 15mar09 15mar16
02082006
5
£393 – 325000 – – – 325000 02aug09 02aug16
saye
4
07042004
1
727 1200 – – – – 1200 01jun07 01dec07
14042005
1
793 1134 – – – – 1134 01jun08 01dec08
total 1508671 650000 456484 – – 2158671
david grigson
6
dsop
3
25062001 £862 92807 – – – 92807 – 25jun06 25jun11
20022002 £528 75757 – – – – 75757 20feb07 20feb12
02082002 £266 150375 – – – – 150375 02aug07 02aug12
24022003 £135 200000 – 200000 – – 200000 24feb06 24feb13
04082003 £245 200000 – 200000 – – 200000 04aug06 04aug13
23022004 £407 122950 – – – – 122950 23feb07 23feb14
27082004 £321 155892 – – – – 155892 27aug07 27aug14
11032005 £419 281886 – – – – 281886 11mar08 11mar15
02082005 £389 303625 – – – – 303625 02aug08 02aug15
15032006
5
£393 – 250000 – – – 250000 15mar09 15mar16
02082006
5
£393 – 250000 – – – 250000 02aug09 02aug16
saye
4
16042003 £090 4200 – 4200 4200 – – 01jun06 01dec06
07042004 £314 1200 – – – – 1200 01jun07 01dec07
14042005 £333 569 – – – – 569 01jun08 01dec08
total 1589261 500000 404200 4200 92807 1992254
notes
1 the options indicated are over american depositary shares adss each ads represents six ordinary shares is denominated in us dollars and trades on nasdaq for the purposes of this
disclosure adss have been converted into the equivalent number of ordinary shares and an equivalent option price
2 the indicated awards were made prior to the appointment of the relevant individual as an executive director the dsop options granted prior to the appointment as an executive director have 
no performance condition
3 save as disclosed in note 2 above exercise of each dsop award is conditional on the performance criteria described on page 30 performance conditions were varied during 2006 as described
on page 30
4 options granted under the saye plan have no performance conditions
5 2006 awards are described on page 30
6 there were total gains of £27384 on the exercise of share options in 2006 2005 £nil the market price of the shares at the dates of exercise on 1 june 2006 and 8 november 2006 were £378 
and £455 respectively
at 29 december 2006 the market price of our shares was 44525 pence per share and 5224 per ads the highest prices during the year were 475 pence per share and 5425 per ads and 
the lowest were 34850 pence per share and 3851 per ads reuters group plc annual report and form 20f 2006
share options granted to senior managers audited
number at number at
1 january 31 december
2006 number number number number 2006
exercise or later granted vested exercised lapsed or earlier earliest
date of price date of during during during during date of exercise expiry
plan grant pounds appointment period period period period departure date date
other senior managers 
as a group 17 persons 
2005 6 persons
3
dsop
2
27122000 £1139 37858 – – – – 37858 27dec01 27dec07
25062001 £862 5800 – – – 5800 – 25jun02 25jun06
25062001 £862 76243 – – – – 76243 25jun02 25jun11
21122001 £692 13549 – – – – 13549 21dec02 21dec11
20022002 £528 5697 – 1424 – – 5697 20feb03 20feb07
20022002 £528 117111 – 13843 – – 117111 20feb03 20feb12
02082002 £266 150000 – 37500 150000 – – 02aug03 02aug07
02082002 £266 736954 – 198813 – – 736954 02aug03 02aug12
24022003 £135 488108 – 98579 81829 – 406279 24feb04 24feb13
01042003 £108 56250 – – 37500 – 18750 01apr04 01apr13
04082003 £245 901365 – 238788 112500 – 788865 04aug04 04aug13
23022004 £407 377713 – 59834 – – 377713 23feb05 23feb14
27082004 £321 343608 – 85902 – – 343608 27aug05 27aug14
11032005 £419 224648 – 56162 – – 224648 11mar06 11mar15
02082005 £389 241968 – 60492 – – 241968 02aug06 02aug15
15032006 £393 36000 234000 – – – 270000 15mar07 15mar16
02082006 £393 – 355000 – – – 355000 02aug07 02aug16
saye
1
11042002 £448 4022 – – – – 4022 01jun05 01dec05
16042003 £090 16800 – 8400 12600 – 4200 01jun06 01dec06
07042004 £314 10800 – – – – 10800 01jun07 01dec07
14042005 £333 4779 – – – – 4779 01jun08 01dec08
10042006 £314 3551 1786 – – – 5337 01jun09 01dec09
total 3852824 590786 859737 394429 5800 4043381
notes
1 options granted under the saye plan have no performance conditions
2 the dsop was approved by the shareholders in april 2001 awards are normally granted with a four year vesting period vesting 25 each year therefore 25 vested in 2006 on the anniversary of
the date of grant if this date fell on a nontrading date the shares vested at the next available trading date
3 other senior managers as a group were 6 persons at 1 january 2006 and were 16 persons at 31 december 2006 following the creation of the glt in june 2006 which replaced the gmc
at 29 december 2006 the market price of our shares was 44525 pence per share and 5224 per ads the highest prices during the year were 475 pence per share and 5425 per ads and the
lowest were 34850 pence per share and 3851 per ads 
36 remuneration report continued reuters group plc annual report and form 20f 2006
37 governance
interests at interests at
interests at 9 march 2007
1 january 2006 31 december 2006 longterm
shares
1
shares shares incentives options
niall fitzgerald kbe 50000 80000 80000 – – 
tom glocer 372145 401345 401345 3192599 6551858
david grigson 63430 67630 67630 763468 1766122
devin wenig 105843 105843 105843 813468 2158671
lawton fitt 25000 25000 25000 – – 
penny hughes – 2392 2392 – – 
ed kozel 7500 7500 7500 – –
sir deryck maughan –– –– – 
nandan nilekani
3
na na –––
ken olisa 2550 2550 2550 – – 
dick olver 10000 10000 10000 – – 
ian strachan 15500 15500 15500 – – 
other senior managers as a group 17 persons
2
327718 415678 394611 2704925 3108040
none of the directors has notified the company of an interest in any other shares or other transactions or arrangements which require disclosure
1 or date of appointment if later than 1 january 2006
2 other senior managers as a group were 16 persons at 31 december 2006 and 17 persons at 9 march 2007 on 15 june 2006 the glt was created and replaced the gmc on 31 december 2006 
julie holland geert linnebank and susan taylormartin stepped down from the glt and john alcantara lee ann daly and david schlesinger were appointed on 1 january 2007 david craig was
appointed to the glt on 1 march 2007
3 nandan nilekani joined the board as nonexecutive director on 1 january 2007
on 13 march 2007 awards of 500000 300000 and 200000 shares under the ltip were made to tom glocer devin wenig and david grigson respectively on the same day share options awards 
of 625000 375000 and 250000 were made to tom glocer devin wenig and david grigson respectively
on 13 march 2007 aggregate awards of 1177680 shares under the ltip and rsp and 731032 share options were made to other senior managers as a group
on 12 march 2007 awards under the 2004 ltip were released to the executive directors and senior managers on 12 march 2007 shares were released to senior managers from the march 2005 rsp
and on 15 march 2007 shares were released to senior managers from the march 2006 rsp 
on behalf of the board
ian strachan
chairman of the remuneration committee 15 march 2007
directors’ interests in ordinary shares
the total interests of the current directors in issued share capital and 
in shares underlying options and incentive plans are shown below as 
at 9 march 2007 no director or senior manager beneficially owns 1
or more of reuters issued share capital interests in ordinary shares
excluding options and interests in longterm incentive plans disclosed
above held at 1 january 2006 and 31 december 2006 are also shown
for directors in office at 31 december 2006 directors were the
beneficial owners of all shares except for 16875 shares held by david
grigson’s family members and 52451 shares held by a trust of which
tom glocer and his family are beneficiaries reuters group plc annual report and form 20f 2006
38 statements of directors’ responsibilities and compliance
corporate governance
the following sections of this report deal with reuters corporate
governance and how the company complies with the requirements 
of the uk’s companies act 1985 the ‘companies act’ and combined
code the nasdaq listing rules and the sec’s rules under the
sarbanesoxley act
compliance with the uk and us rules 
on governance
the listing rules of the uk listing authority of the fsa require uk
listed companies to report on their governance practices and on 
the extent to which they comply with the provisions set out in the
combined code on corporate governance as reuters shares are
also traded on nasdaq we are required to comply with nasdaq’s
listing rules and the sec’s governance rules in this section of the
report we describe how we comply with these requirements and
where we do not comply we explain why not
throughout 2006 reuters has complied with the combined code on
corporate governance save that no individual member of the audit
committee has been identified by the board as having ‘recent and
relevant financial experience’ code principle c31 however in
common with all the nonexecutive directors the members of the
audit committee are experienced and influential individuals having
the skills described in their biographies in ‘directors and senior
managers’ see pages 26–28 and the board considers that
collectively the members have the attributes required to discharge
properly the committee’s responsibilities
reuters also complies with all sec and nasdaq governance
requirements with the exception of two provisions of the nasdaq
governance rules the company has received waivers from nasdaq
to both exceptions on the basis that compliance with the rules would
be contrary to standard uk business practice since 1988 reuters has
operated under a waiver of nasdaq’s requirement that all
shareholder meetings require a quorum of at least onethird of
outstanding voting shares instead the company’s articles of
association articles provide as is typical for english public
companies that a quorum shall consist of any two shareholders in
2004 the company also received a waiver from nasdaq’s provisions
requiring shareholder approval of employee sharebased incentive
schemes reuters seeks and has received shareholder approval of its
employee sharebased incentive schemes to the extent required by
uk regulation including the listing rules
while the company’s auditors pricewaterhousecoopers llp  are not
required to form an opinion on the effectiveness of the company’s
corporate governance procedures they are required to review
whether this corporate governance statement reflects the company’s
compliance with nine of the combined code’s provisions as specified
by the listing rules these provisions are contained within section c
of the combined code which relates to accountability and audit
having conducted a review pricewaterhousecoopers llp are obliged
to report if they consider that this statement does not reflect such
compliance no such report has been made
a the board
composition of the board
“every company should be headed by an effective board which is
collectively responsible for the success of the company” combined
code – main principle a1
“the board should include a balance of executive and nonexecutive
directors and in particular independent nonexecutive directors such
that no individual or small group of individuals dominate the board’s
decision taking” combined code – main principle a3
the board comprises a nonexecutive chairman 8 nonexecutive
directors and 3 executive directors further details of the board’s
composition and the company’s assessment of the independence of
its directors are set out in the table below biographies of the directors
and details of their other commitments are set out on pages 26–27
biographies of reuters senior managers are set out on pages 27–28
composition of the board
independent
no of years as determined audit nominations remuneration
name position on board by the board committee committee committee
l fitt nonexecutive director and chairman of audit committee 2 yes yes chairman no no
n fitzgerald chairman and chairman of nominations committee 4 yes no yes chairman no
t glocer ceo 5 nononono
d grigson cfo 6 nononono
p hughes nonexecutive director 2 yes no no yes
e kozel
5
nonexecutive director 6 yes no no yes
d maughan
6
nonexecutive director 1 yes no no see note 6
n nilekani
4
nonexecutive director in first year yes yes no no
k olisa nonexecutive director 2 yes yes no no
d olver
1
nonexecutive director and senior independent director 9 yes yes yes no
i strachan
2
nonexecutive director and chairman of remuneration committee 6 yes no yes yes chairman
d wenig
3
coo 3 nononono
notes
1 dick olver was chairman of the audit committee until 9 november 2006 when he was succeeded by lawton fitt
2 ian strachan was appointed to the nominations committee on 24 january 2006
3 devin wenig was appointed as chief operating officer on 15 june 2006
4 nandan nilekani was appointed as a nonexecutive director and a member of the audit committee with effect from 1 january 2007
5 ed kozel is retiring from the board and the remuneration committee on 26 april 2007
6 sir deryck maughan is joining the remuneration committee on 26 april 2007 reuters group plc annual report and form 20f 2006
39 governance
attendance at meetings
attendance at attendance attendance
board meetings attendance at audit at remuneration at nominations 
8 meetings  committee meetings committee meetings committee meetings
name awayday in 2006 6 meetings in 2006 5 meetings in 2006 1 meeting in 2006
l fitt full attendance full attendance na na
n fitzgerald full attendance na na full attendance
t glocer full attendance na na na
d grigson full attendance na na na
p hughes full attendance na absent 1 na
e kozel absent 2 na absent 1 na
d maughan absent 2 na na na
k olisa absent 1 full attendance na na
d olver absent 1 absent 1 na full attendance
i strachan absent 1 na full attendance full attendance
d wenig full attendance na na na
niall fitzgerald attended 5 remuneration committee meetings at the invitation of the remuneration committee chairman
the ceo attended 5 remuneration committee meetings at the invitation of the remuneration committee chairman and 3 audit committee
meetings at the invitation of the audit committee chairman
the quality of the individual directors the balance of the board’s
composition and the dynamics of the board as a group ensure both
the board’s effectiveness and the inability of an individual or small
group to dominate the board’s decision making
the board has determined that each of the nonexecutive directors 
is independent in character and judgement by reason of his or her
personal qualities and that each of the nonexecutive directors is
‘independent’ as that term is defined in nasdaq and sec
governance requirements particular consideration was given to the
assessment of dick olver’s independence since he has now been on
the reuters board for more than nine years dick was asked by the
chairman to remain on the board because of his experience wisdom
and his effectiveness as a nonexecutive director
board responsibilities and process
“there should be a clear division of responsibilities at the head of 
the company between the running of the board and the executive
responsibility for running the company’s business no one individual
should have unfettered powers of decision” combined code – main
principle a2
there is a clear division of responsibilities between the running of the
board which is the chairman’s responsibility and the running of
reuters business which is the ceo’s responsibility with the board
having oversight the division of responsibilities is set out in a
document approved by the board the board is responsible for the
success of the group within a framework of controls which enables 
risk to be assessed and managed its aim is for the group to achieve
profitable growth within an acceptable risk profile
all directors are equally accountable for the proper stewardship of 
the company and share responsibility for maintaining the company’s
high standards of ethics and integrity the nonexecutive directors
contribute particularly by challenging constructively the company’s
strategy and performance management’s assessment of risk the
integrity of internal controls and by ensuring appropriate
remuneration and succession planning arrangements are in place
the senior independent director dick olver is responsible for
undertaking the annual review of the chairman’s performance and 
he chairs the nominations committee when considering the role of
chairman the senior independent director also makes himself
available to shareholders to discuss any matters
the ceo is assisted by the glt in managing the business it
comprises the three executive directors and the senior managers
listed on page 26 a disclosure committee chaired by the ceo
reviews the group’s trading statements and financial results and
considers the effectiveness of the group’s disclosure controls and
procedures its members comprise the ceo the cfo the director of
corporate affairs the general counsel and company secretary the
global head of internal audit the global head of finance the head
of external reporting the general counsel for the americas the
global head of investor relations and the global head of external
communications a subcommittee meets on an ad hoc basis to
address disclosure matters arising between reporting periods
a schedule of matters reserved for the board’s decision identifies
those matters that the board does not delegate to management 
it includes the approval of corporate objectives strategy and the
budget significant transactions and matters relating to share capital
the board delegates specific responsibilities to the audit
remuneration and nominations committees each committee has 
its own terms of reference set by the board these are available on
request from the company secretary or at
wwwaboutreuterscomcsrcorporategovernance reports of the
audit and remuneration committee are set out on pages 29 and 42
and the activities of the nominations committee are described in the
interview with niall fitzgerald on pages 22–23
all directors have access to the services of the company secretary
who is appointed by and can only be removed by the board the
directors may take independent professional advice at the company’s
expense none of the directors sought such advice during 2006
reuters provides insurance cover and indemnities for its directors and
officers
the board met eight times in 2006 and held a twoday strategy
meeting with senior management in palo alto california the
chairman routinely meets with nonexecutive directors without the
executive directors present after each board meeting attendance 
by individual directors at board and committee meetings during 2006
is set out in the table below reuters group plc annual report and form 20f 2006
40 statements of directors’ responsibilities and compliance
continued
appointments to the board
“there should be a formal rigorous and transparent procedure for the
appointment of new directors to the board” combined code – main
principle a4
the nominations committee leads the process for board
appointments and makes recommendations to the board its work 
in 2006 is summarised above in the interview with niall fitzgerald
see pages 22–23 a director may not be involved in any decision
concerning him or his successor the committee has appointed an
external adviser to assist it in its work in identifying potential
candidates for nonexecutive directorships
information and directors’ induction and training
“the board should be supplied in a timely manner with information in
a form and of a quality appropriate to enable it to discharge its duties
all directors should receive induction on joining the board and should
regularly update and refresh their skills and knowledge” combined
code – main principle a5
nandan nilekani who joined reuters board on 1 january 2007 received
a directors’ manual which provides information about reuters and the
operation of the board and its committees during 2007 he will receive 
a series of induction briefings to gain insights into the company nandan
like the other directors is being supplied with reuters products
ongoing training for directors is available as appropriate the
company’s legal advisers and auditors provide briefings to the
directors from time to time in the twelve months to march 2007 the
directors received information from the company’s lawyers and
auditors on aspects of sarbanesoxley act the new uk companies
act 2006 and on new legislation concerning disclosures to be made
to the auditors guest speakers are occasionally invited to join board
dinners to discuss topics of interest with the directors and
opportunities are provided for nonexecutive directors to meet with
shareholders customers and others involved in reuters business
the chairman is responsible for ensuring that directors receive
accurate timely and clear information regular and ad hoc reports
and presentations are prepared and circulated to the directors a week
in advance of board meetings together with minutes and papers
relating to the board’s committees the directors also receive a
monthly performance report which summarises financial and
operational performance and provides updates on key programmes
within the business
board performance evaluation
“the board should undertake a formal and rigorous annual evaluation
of its own performance and that of its committees and individual
directors” combined code – main principle a6
in response to the findings of the 2005 board effectiveness review
during the year the board made some changes to the way it operates
it introduced time at the end of each meeting for the chairman and
nonexecutive directors to meet on their own it improved the flow of
information about aspects of the business which might be of general
interest to the directors and it created an opportunity at its annual
strategy meeting for the board and senior management to spend time
together outside the usual environment of a board meeting
the 2006 board effectiveness review was similar in format to the 2005
review in that
• the chairman reviewed the performance of the ceo and each
individual director
• the ceo reviewed the performance of the cfo and the coo
• dick olver the senior independent nonexecutive director led 
a review of the performance of the chairman
• dr annie mckee of the teleos leadership institute facilitated a
board effectiveness review in which the performance of the board 
as a whole and of the chairman and the ceo was considered
• dr mckee also facilitated reviews of the effectiveness of the audit
committee and the remuneration committee and
• the board discussed and agreed the nominations committee’s
approach to identifying and recruiting potential future board
members
the format of the reviews was interviews with the directors and others
involved in the work of the board and its committees the output from
which was thematically analysed and discussed with the person or
group being reviewed the board as a whole as well as with the
chairman in addition to agreeing actions relating to individual and
collective effectiveness the board has decided to change the
frequency and length of board meetings to have six rather than eight
meetings each year but to extend each meeting over two days to
allow the directors to become more deeply immersed in consideration
of strategic issues
reelection of directors
“all directors should be submitted for reelection at regular intervals
subject to continued satisfactory performance the board should
ensure planned and progressive refreshing of the board” combined
code – main principle a7
the articles provide that at each agm any director appointed since
the last agm shall stand for election by the shareholders and one
third of the directors shall retire from office by rotation and be eligible
for reelection by the shareholders however to recognise that some
shareholders prefer all the directors to stand for reelection each year
once again at the 2007 agm each of the directors will retire from
office and offer himself or herself for reelection save for ed kozel
who will retire from the board with effect from the end of the agm
b remuneration of directors
the combined code has a section covering remuneration principles
reuters compliance with those principles is described in the directors’
remuneration report on pages 29 to 37
c accountability and audit
directors’ statement of responsibility
“the board should present a balanced and understandable
assessment of the company’s position and prospects” combined
code – main principle c1
the directors are responsible for ensuring that the directors’ report
and the consolidated financial statements of the company and its
subsidiaries the group and parent company financial statements for
reuters group plc are prepared in accordance with applicable laws
and regulations the financial statements for each financial year must
give a true and fair view of the state of affairs of the group as at the
end of the financial year and of the profit and cash flows of the group
for the period the company is also required to prepare financial
statements in accordance with the requirements of the sec
the company has complied with both uk and us disclosure
requirements in this report in order to present a true and fair view to all reuters group plc annual report and form 20f 2006
shareholders in preparing the financial statements applicable
accounting standards have been followed suitable accounting policies
have been used and applied consistently and reasonable and prudent
judgements and estimates have been made where appropriate
the directors have reviewed the budget and cash flow forecasts for
the group for the year to 31 december 2007 and outline projections
for the subsequent year in the light of the financial position and
borrowing facilities at 31 december 2006 on the basis of this review
the directors are satisfied that reuters group is a going concern and
have continued to adopt the going concern basis in preparing the
financial statements
internal control
“the board should maintain a sound system of internal control to
safeguard shareholders’ investment and the company’s assets”
combined code – main principle c2
the directors acknowledge their responsibility for the company’s
system of internal control and confirm they have reviewed its
effectiveness in doing so the board has taken note of the guidance
on internal control the turnbull guidance contained in the
combined code the board confirms that it has a process for
identifying evaluating and managing significant risks faced by the
company this process which accords with the turnbull guidance has
been in place for the full financial year and is ongoing the control
system includes
• objective setting risk assessment and monitoring of performance 
at both strategic and business unit levels though a process known
within the company as ‘mission analysis’
• the use of ‘balanced scorecards’ to track performance against
targets relating to the financial business people and customer
aspects of the company’s business
• written policies and control procedures
• monthly reporting to the board and senior management which
amongst other things tracks performance against the annual
budget
• systems to communicate rapidly to appropriate managers incidents
requiring immediate attention and
• review meetings by the ceo and cfo or coo with each glt
member which cover the performance risks and controls for which
the glt member is responsible
in a group of the size complexity and geographical diversity of
reuters it should be expected that breakdowns in established control
procedures might occur there are supporting policies and procedures
for reporting and management of control breakdowns the board
considers that the control system is appropriately designed to
manage rather than eliminate the risk of failure to achieve business
objectives and can only provide reasonable and not absolute
assurance against material misstatement or loss the concept of
reasonable assurance recognises that the cost of a control procedure
should not exceed the expected benefits
using a common risk management framework throughout reuters
each of the principal business and functional units summarises the
risks that could impede the achievement of its objectives for each
significant risk line managers document an overview of the risk how 
it is managed and any improvement actions required a document
called a ‘risk radar’ is created which sets out the main strategic and
operational risks that have been identified this document is reviewed
by the glt and the board
at the year end before producing the above statement on internal
control in the annual report and form 20f the ceo and cfo meet
with members of the glt and others to consider formally the
operation and effectiveness of the company’s risk management and
financial operational and compliance internal control systems as well
as its disclosure controls and procedures this review includes
consideration of compliance selfassessment reports from line
management and covers each of the most significant risks the
company faces and how well these are controlled and managed the
ceo and the cfo report on the results of this review to the audit
committee and to the board the disclosure committee described
on page 39 supports the process by reviewing disclosure controls 
and procedures
in addition to the management review procedures the group
monitors its internal financial control system through a programme of
internal audits internal auditors independently review the controls in
place to manage significant risks and report to the audit committee
twice a year the audit committee reviews the assurance procedures
annually including compliance controls and reports its findings to the
board the group’s external auditors pricewaterhousecoopers llp 
have audited the financial statements and have reviewed the work of
internal auditors and the internal control systems to the extent they
consider necessary to support their audit report in 2006 management
commissioned a report on reuters internal control environment 
from independent audit limited an independent consultancy 
the audit committee was satisfied with the report’s findings 
the audit committee also met the internal auditors and
pricewaterhousecoopers llp to discuss the results of their work
reuters management carried out an evaluation of the effectiveness 
of the design and operation of the group’s disclosure controls and
procedures these are designed to ensure that information required
to be disclosed in reports filed under the securities exchange act of
1934 is recorded summarised and reported within specific time
periods based on this evaluation the ceo and the cfo concluded
that the design and operation of these disclosure controls and
procedures were effective as at 31 december 2006 to a reasonable
assurance level within the meaning of the us federal securities laws
no changes were made in the group’s internal controls over financial
reporting during the period covered by this report that materially
affected or are reasonably likely to affect materially the group’s
internal control over financial reporting
management’s report on internal control 
over financial reporting
in accordance with section 404 of the sarbanesoxley act the
following report is provided by management in respect of the
company’s internal control over financial reporting as defined in rules
13a–15f and 15d–15f of the us securities exchange act of 1934
the management of the group is responsible for establishing and
maintaining adequate internal control over financial reporting for the
company the company’s internal control over financial reporting is 
a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of the company’s
financial statements for external purposes in accordance with
generally accepted accounting principles
41 governance reuters group plc annual report and form 20f 2006
the group’s internal control over financial reporting includes those
policies and procedures that i pertain to the maintenance of records
that in reasonable detail accurately and fairly reflect the transactions
and dispositions of the assets of the group ii provide reasonable
assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally
accepted accounting principles and that receipts and expenditures of
the group are being made only in accordance with authorisations of
management and directors of the group and iii provide reasonable
assurance regarding prevention or timely detection of unauthorised
acquisition use or disposition of the group’s assets that could have 
a material effect on the financial statements
because of its inherent limitations internal control over financial
reporting may not prevent or detect misstatements projections of any
evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions
or that the degree of compliance with the policies or procedures may
deteriorate
management assessed the effectiveness of the group’s internal
control over financial reporting as of 31 december 2006 based on the
framework set forth by the committee of sponsoring organizations 
of the treadway commission coso in internal controlintegrated
framework based on that assessment management concluded that
as of 31 december 2006 the group’s internal control over financial
reporting was effective
pricewaterhousecoopers llp  which has audited the consolidated
financial statements of the group for the financial year ended 
31 december 2006 has also audited management’s assessment of the
effectiveness of the group’s internal control over financial reporting
and the effectiveness of the group’s internal controls over financial
reporting their report is included herein
audit committee and auditors
“the board should establish formal and transparent arrangements for
considering how they apply the financial reporting and internal control
principles and for maintaining an appropriate relationship with the
company’s auditors” combined code – main principle c3
reuters adherence to this principle is described in the audit
committee report below
audit committee report
members
members of the committee during 2006 were dick olver chairman
until 9 november 2006 lawton fitt chairman from 9 november
2006 and ken olisa nandan nilekani joined the committee on 
1 january 2007 the board has determined that the audit committee
does not at present include a member who is a ‘financial expert’ as
defined in the sarbanesoxley act and related sec rules because the
board considers that none of the members clearly meets all the
criteria set out in the relevant definitions nor has the board identified
a member of the committee as having recent and relevant financial
experience however the board considers that collectively the
members have the requisite skills and attributes to enable the
committee properly to discharge its responsibilities the company
secretary is secretary to the committee
responsibilities
each year the audit committee reviews and as appropriate actively
engages in the processes for financial reporting internal control risk
assessment audit and compliance assurance the independence of
the company’s internal and external auditors and the effectiveness of
the company’s system of accounting its internal financial controls and
the internal and external audit functions
the audit committee’s remit which is set out in its terms of reference
includes responsibility for
• the oversight responsibilities described in the above paragraph and
for reviewing compliance with laws regulations the company’s code
of conduct and policies
• approving related party transactions to the extent required under
nasdaq rules
• monitoring the integrity of the company’s financial statements and
any announcements relating to the company’s financial performance
and reviewing significant financial reporting judgments contained in
them
• monitoring and reviewing the effectiveness of the company’s internal
audit function
• making recommendations to the board for it to put to the
shareholders for their approval regarding the appointment 
reappointment and removal of the external auditor and approving
the remuneration and terms of engagement of the external auditor
• reviewing and monitoring the external auditor’s independence and
the effectiveness of the audit process and developing and
implementing policy on the engagement of the external auditor 
to supply nonaudit services and
• overseeing the receipt review and treatment of complaints received
regarding accounting internal accounting controls auditing and
compliance matters whether through the company’s ‘whistleblower’
confidential helpline or otherwise
activities
the committee met five times in 2006 with the ceo the cfo other
officers and the auditors attending as required the auditors have
unrestricted access to the audit committee and met after five of the
2006 committee meetings privately with the committee members as
did the global head of internal audit
the chairman of the audit committee meets with the global head 
of internal audit and with the external auditors before each audit
committee meeting all members of the audit committee attended
every committee meeting during the year except for dick olver who
was absent from one meeting the committee reports its activities
and makes recommendations to the board during 2006 the
committee discharged the responsibilities set out in its terms of
reference its activities included
• formally reviewing the draft annual report and interim statement
respectively and associated announcements focusing on the main
areas of judgement and critical accounting policies
• reviewing the findings of the external auditors and the report of 
the global head of internal audit on internal audit activities
• reviewing the effectiveness of internal control systems and the risk
management process and considering how those were changing 
as a result of the introduction of centralised backoffice functions
42
reuters group plc annual report and form 20f 2006
statements of directors’ responsibilities and compliance
continued reuters group plc annual report and form 20f 2006
• paying particular attention throughout the year to the work being
undertaken in connection with section 404 of the sarbanesoxley
act
• receiving the report of the ceo and the cfo on the processes
followed prior to certification being given by them in connection
with sections 302 and 404 of the sarbanesoxley act
• reviewing the external audit strategy and the external auditors’
report to the committee in respect of the annual report and interim
statement
• considering the directors’ duties under section 234za of the
companies act 1985 regarding disclosure of information to the
company’s auditors
• keeping under review the proportion of nonaudit fees to audit fees
paid to the auditors and giving preapproval to nonaudit work
undertaken by the auditors
• reviewing the effectiveness of the internal and external auditors
• reviewing the compliance programme including the whistleblower
programme and
• reviewing a report on the company’s corporate responsibility
activities
the board adopted a code of ethics for the company’s ceo and
senior financial officers in 2003 revised in 2005 in addition to the
company’s general code of conduct no material amendments to or
waivers in respect of either code were made during 2006 copies of
the codes are available on request from the company secretary and
can be viewed at wwwaboutreuterscom
the committee monitors adherence to the company’s auditor
independence policy which prohibits group entities from engaging
the auditors in activities prohibited by the sec or the us public
company accounting oversight board the policy permits the
auditors to be engaged for other services provided the engagement
is specifically approved in advance by the committee or is approved
by the cfo and meets the detailed criteria of specific preapproved
activities and is notified to the committee however any services
where the expected level of fees is greater than £150000 or the
expected term is longer than one year must be approved in advance
by the committee
for details regarding fees paid to the group’s auditors see note 3
to the financial statements on page 85 and note 5 to the summary 
of differences on page 133
the committee may engage at the company’s expense independent
counsel and other advisers as it deems necessary to carry out its
duties none was engaged during the year
lawton fitt
chairman audit committee
15 march 2007
disclosure of information to the auditors
so far as each director is aware there is no relevant audit information
of which the auditors are unaware and each director has taken all
steps that he ought to have taken as a director to make himself or
herself aware of any relevant audit information and to establish that
the auditors are aware of that information this confirmation is given
pursuant to section 234za companies act 1985
d relations with shareholders
“there should be a dialogue with shareholders based on the mutual
understanding of objectives the board as a whole has responsibility
for ensuring that a satisfactory dialogue with shareholders takes
place” combined code – main principle d1
the executive directors meet regularly with institutional shareholders
and analysts nonexecutive directors are offered the opportunity to
attend meetings with major shareholders and from time to time some
attend the presentations of the annual results to analysts niall
fitzgerald met with various investors during the year no shareholders
asked to meet with dick olver the senior independent director
during the year
an investor relations department is dedicated to facilitating
communications between the company and its shareholders in the
last three years reuters has received several awards for investor
relations including the ir magazine award in each of those years for
best investor relations in the media sector it provides a regular report
on investor relations as part of the routine board report materials 
the company’s agm is used as an opportunity to communicate with
private investors the chairmen of each of the board committees are
available to answer questions at the agm and all directors are
expected to attend the agm at the agm the level of proxies lodged
on each resolution and the balance for and against the resolution and
the number of votes withheld are announced after the resolution has
been voted on at the 2005 agm voting using a poll for all
resolutions was introduced to replace voting by a show of hands as
the board considers poll voting gives a better representation of
shareholders’ views the results of voting at the agm in 2007 will 
be available at wwwaboutreuterscom
by order of the board
rosemary martin
general counsel and company secretary
15 march 2007
43 governance reuters group plc annual report and form 20f 2006
44 company information
this section of our annual report and form 20f provides more
detailed information on
• strategy
• markets
• people
• ethics and compliance
• corporate responsibility
• supply chain
• governmental regulation
• supplementary information
01 strategy
see ‘business review’ on pages 6–7
grow revenues both from our core business
and through our core plus initiatives
our core business serves a £6 billion per annum market for financial
information and related services with an estimated growth rate of 2–4
we are continuing to improve our product line by delivering regular
upgrades to content and functionality for example in 2006 we
extended our coverage of the credit derivatives markets this
approach of continuous product enhancement is justifying increased
prices and helping us to attract new users particularly in the
institutional investment community and at our largest clients we are
also evolving our commercial model to align pricing more closely with
customers’ use of our data which is trending upwards we believe
that by continuing to develop our product line we can continue to
grow our business at least as fast as the market
with core plus we are aiming to become market leaders in electronic
trading new and hardtoobtain information what we call highvalue
content advanced technology solutions for financial services
companies and services for new markets we are creating neutral
scaleable open trading platforms to be used by both people and
machines and we are seeking to be a recognised innovator in new
asset classes consumer media and highgrowth economies
electronic trading
reuters has an established track record of providing electronic
transaction services for the financial markets such as our foreign
exchange conversational dealing system reuters dealing 3000 and
our electronic bidandoffer matching service reuters dealing
matching we believe that the electronic trading trend is accelerating
and as a result we have invested in electronic trading services by
building a multiasset trading platform reuters trading for foreign
exchange and reuters trading for fixed income were the first
services to be delivered over the platform joined in october 2006 by
reuters trading for exchanges which provides equity order routing
facilities for institutions wanting to trade in january 2007 we
announced that this service would be distributing trading algorithms
and routing orders on behalf of the bny convergex group an
affiliate of the bank of new york a leading agency broker we
believe this has the potential to drive additional sales of our premium
desktop products reuters trade notification service which helps
customers streamline their trade confirmation operations was
launched in the second half of 2006 and has seen rapid growth in 
the number of messages carried
highvalue content
we see increasing demand from customers especially from hedge
funds for content which gives them not just facts but insight we are
investing in the creation of this highvalue content by expanding our
specialist editorial and data teams and also through acquisition and
distribution agreements such as our arrangement to distribute the
highly regarded university of michigan surveys of consumers which
are a lead indicator of us consumer confidence a closely watched
financial markets statistic our global coverage of company
fundamentals and the breadth and depth of our estimates helped
to strengthen our products in 2006 in 2007 we are planning to
launch a primary research product which will offer highvalue
proprietary content both from reuters sector specialists and
respected third party content providers the first sectors will be
healthcare and technology
new enterprise services
in a highly competitive market our customers are turning to
computerdriven trading and increasingly complex financial products
in order to differentiate themselves from their competitors our
enterprise business helps banks and other financial organisations to
automate their businesses by managing the flow of information and
transactions both internally and with their institutional customers
demand for structured information and data management services is
increasing driven by growth in program and algorithmic trading the
need for greater transparency in order to satisfy regulatory compliance
requirements is also a factor in the growing demand for data
we have a wide range of assets such as highspeed streams of
machinereadable trading data historical price data and risk
management and positionkeeping systems using these tools we
have built longterm partnerships with many of our largest clients to
help them develop their information and trading infrastructures we
are making our products more compelling to our customers by
offering tools such as reuters tick history which is used to backtest
clients’ algorithmic trading strategies reuters tick capture engine
which stores details of price movements as they happen and reuters
wireless delivery network which enables our customers to distribute
content to their employees’ mobile devices reuters newsscope
launched in 2006 is an innovative service for financial institutions that
want to use algorithms to drive automated trading from news reports
it categorises news events so that machines can ‘read the news’ and
the information can then be used to generate inputs to trading
algorithms and inform trading decisions in 2007 we are planning to
launch a counterparty data service which will help banks to improve
the efficiency of their trading and settlement operations and reduce
risk by verifying details of their trading counterparties
new markets
we are increasing our presence in highgrowth geographic markets
in india in january 2006 times now a 24hour englishlanguage
news television channel was launched the venture is owned jointly
with bennett coleman  co india’s largest publishers of english
language news and is helping us to build our consumer media
presence in india in china we are sourcing content from our new
beijing centre to meet growing local demand adding data from a
range of chinese brokers and providing coverage of local pension
fund indices we are extending our coverage of financial markets in
the middle east focusing on news company fundamental data funds
information and broker research we also see opportunities to serve
the growing market for shari’ahcompliant finance products
we have identified emerging asset classes with the potential to
become liquid markets these include real estate environmental
markets including the rapidly growing emissions trading market and
freight derivatives an asset class tied directly to growth in china and
india in 2006 we appointed lead correspondents to focus and  reuters group plc annual report and form 20f 2006
45 company information and ofr
coordinate our editorial coverage for each of these markets and
enhanced it with content from key thirdparty sources this coverage 
is now included in our premium desktop products and in our new 
webbased services such as reutersrealestatecom
we are also continuing to target new types of customer such as a
consumer media audience we are building a fastgrowing presence
around the world with our reuterscom family of websites and our
content services for mobile devices and internetdelivered tv
core plus investment
we are now halfway through an investment programme started in
2005 to drive revenue growth and have started to see core plus
revenues coming through ahead of target
creating future growth opportunities
fxmarketspace
in addition to our core and core plus trading products we are also
investing in an innovative new foreign exchange fx trading system
fxmarketspace which we established with the chicago mercantile
exchange cme as a 5050 joint venture fxmarketspace to be
launched in march 2007 is helping to lead changes in fx market
structure by offering the world’s first centrallycleared global fx
marketplace it will provide broader access to the fx market by
making it possible for nonbank financial institutions to participate
creating potential for further growth in electronic trading volumes
fxmarketspace will be accounted for as a joint venture for more
information see note 15 on page 96
innovation programme
in december 2005 we launched our innovation programme its aim is
to identify opportunities to use our content and technology expertise
in projects which have the potential to fuel our medium to longterm
growth the programme looks for transformational business ideas that
represent a ‘step out’ from or challenge to our existing activities
during 2006 we developed a portfolio of projects and a pipeline of
ideas and were pleased to see one project reuters newsscope see
‘new enterprise services’ on page 44 above start to deliver revenue
initiatives expected to contribute revenue in 20072008 include
reuters market light and reuters insight reuters market light takes
us into an entirely new market serving rural farming communities
via their mobile phones farmers receive accurate local pricing for
their goods together with weather information that directly influences
their choices of when to harvest and to which market town to take
their crops an early version of the service is currently being piloted in
northern india reuters insight is aimed at midsize companies looking
to develop and sustain their international operations it provides
personalised content together with access to relevant communities
able to share expertise which can help them to assess the political
environmental and social risks they may face the service is currently 
in client testing
simplify our organisation in order to become
stronger more competitive and more efficient
we are working to deliver further improvements in our products and
our customer service through a series of simplification initiatives and
through these we are aiming to deliver £150 million in annualised cost
savings by 2010 this is in addition to the £885 million of cost savings
already delivered since 2001
changing the way our product development teams work
in 2006 we completed the integration of our development organisation
into the business divisions to bring it closer to our customers we are
also streamlining our software development as we move to a smaller
number of larger sites by the end of 2006 over 40 of our
development resource was in our centres in bangkok and beijing
simplifying our product delivery infrastructure and making 
it more robust
we aim to consolidate our data centres from 250 to 10 by 2010
as we move our customers and our products to a modern ip
telecommunications network in 2007 we are also working to
consolidate our product delivery infrastructures into a common
platform from which to deliver our products we are aiming to deliver
the first products over the new platform in 2008
transforming the way our content is created collected and
processed
we are investing in extensive automation of our content production
and in content quality improvements in 2006 our content quality
programme focused on improving the timeliness and accuracy of fixed
income data in 2007 we will extend the programme to other asset
classes
modernising our customer administration systems
we are modernising our administration systems in order to make 
it faster and easier for us to provide customers with access to our
products and to simplify our ordering and billing processes
02 markets
see pages 10–11 in the ‘business review’
financial markets
we and our customers are affected by global economic trends and 
by developments in the financial services markets in this section 
we provide a high level macroeconomic overview of 2006 as the
backdrop to our performance during the year and highlight the key
market trends we believe will influence our ability to achieve our goals
in 2007
the global economy
the global economy saw good growth in 2006 showing solid levels 
of employment and consumer optimism during the year in the us
concerns over inflation and consequent interest rate increases
tempered growth but to a lesser extent than many market watchers
had predicted asia continued to thrive as china and india fuelled the
region’s economic expansion and japan showed steady moderate
growth economic growth in the euro zone accelerated at its fastest
rate since 2000
the global macroeconomic outlook for 2007 is relatively strong with
the international monetary fund imf projecting global economic
growth of around 5 however concerns persist about geopolitical
risks including intensifying inflationary pressures a rebound in oil
prices due to geopolitical uncertainty in the middle east and
elsewhere and the risk of a slowdown of the us economy reuters group plc annual report and form 20f 2006
46 company information continued
financial services industry performance in 2006
2006 was a record year for investment banks whose revenues
benefited from buoyant initial public offering and mergers 
acquisitions markets as well as from proprietary trading activities and
increased services to hedge funds and private equity however
financial services industry consolidation continued in europe financial
markets rebounded globally in the second half of the year after their
earlier energydriven selloffs
shares indices
fx volumes continued to increase driven by hedge and pension
funds celent has estimated that average fx daily trading volumes will
reach 4 trillion by 2010 up from 19 trillion in 2004
average daily turnover in traditional foreign
exchange markets us trillion
trading in derivative financial instruments such as options and credit
derivatives grew faster than any other asset class and commodity and
energy prices remained volatile
hedge funds continued to gain influence in the financial markets 
now controlling more than 1 trillion in assets globally and were some
of the most active traders accounting for up to half of total revenues
at big equity brokers the private equity industry also grew at an
unprecedented rate
market outlook for 2007
continued consolidation in europe together with the increasing
automation of trading floors is likely to put some pressure on front
office jobs us securities industry and uk ‘city’ employment is
expected by commentators to level out over the next two years
however 2007 is still expected to be a good year for the financial
markets commodity markets are likely to remain strong and volatile
and there seems to be no letup in sight in the record growth of
derivatives and structured products global uncertainty will drive
continued fx volatility and volume and proprietary trading is
expected to show doubledigit growth in assets like credit
key market trends
market structures are continuing to evolve
• fx markets are preparing for the shift towards an exchangetraded
model as demonstrated by the willingness of banks and prime
brokers to trade on fxmarketspace
• exchange consolidation is ongoing cme announced a merger 
with cbot london stock exchange may still face the possibility 
of a takeover
• continuing banking consolidation could increase the number of
european banks big enough to compete directly with the largest 
us institutions
the rise in electronic trading is set to continue in 2007 
and beyond
• algorithmic trading a key driver in the growth in electronic trading
is being more broadly adopted across asset classes and
geographies
• by 2010 algorithmic trading is expected to account for more than
half of all equities trading volume in the us
• increasing automation of trading by investment banks and hedge
funds is driving the demand for high speed structured information
and data management services
the financial services industry is developing increasingly
complex highly structured financial products
• trading in instruments such as property derivatives and freight
derivatives is increasing
• new types of instruments such as longevity risk are being
conceived and launched
• the need to tackle climate change is driving growth in emissions
trading – the european climate exchange launched the first
emissions options contract in 2006
• a shari’ahcompliant derivatives market is under development 
with the potential to transform the financial landscape in the 
middle east
the hedge fund industry is expected to continue its growth
and its importance to the financial markets ecosystem
• large funds are growing their assets much more rapidly than their
smaller competitors
• investment banks are likely to continue taking stakes in hedge funds
as the distinction blurs between hedge funds and more traditional
asset management firms
• hedge funds are particularly active in driving demand for highvalue
content including sources of market and company insight as they
look for trading advantage
the information needs of investment managers are changing
as the investment profile of funds becomes increasingly
polarised
• investment funds appear to be polarising with demand for absolute
returnalternative investment strategies at one end of the spectrum
and large passive index portfolios on the other
80
100
120
140
160
hang seng
bse sensex
nikkei 225
dow jones industrials
sp 500
ftse 100
jan 06 april 06 july 06 sep06 dec 06
2001
2004
2007
2010
source celent llc
12
19
3
4 reuters group plc annual report and form 20f 2006
47 company information and ofr
• independent analysts are gaining market share as mutual funds
seek more independent research
wealth management is the fastestgrowing segment of the
financial services marketplace
• growing life expectancy and intensifying pressure on pension
provision reform is underpinning demand for wealth management
services
new market regulations are creating requirements for greater
price transparency
• particular focus on the markets in financial instruments directive
mifid in the eu and regulation nms in the us reg nms is
expected to drive annual growth of over 70 in the number of
trades routed intermarket
• growing regulatory oversight across the world is likely to fuel
demand for analytics risk management pricing valuation and 
data management tools
financial information technology spending is expected to
continue rising in 2007
• banks in the asia pacific region are expected to increase their
investments faster than elsewhere according to celent
• hedge funds are beginning to demand improved service levels
from their prime brokers which is likely to trigger prime brokers’ 
it spending
risk management systems are increasingly in demand
• recent hedge fund failures and concerns about systemic credit
derivative risk have raised fears of market disruptions
in media usergenerated content and social networks are
increasing in popularity
• harnessing these trends will be key to building and sustaining
online communities audiences and brands
online advertising is growing rapidly
• online advertising is expected to grow seven times faster than
traditional advertising in 2007 creating opportunities for brands
with a strong online presence
use of broadband connectivity mobiles and smartphones 
is growing
• rapid consumer adoption of new technologies is facilitating greater
use of multimedia news information and entertainment
03 people
see ‘business review’ on page 12
during 2006 our employees once more showed their adaptability
commitment and professionalism as the company continued to
implement its growth and simplification plans this has been
demonstrated in several ways including acquisition of new skills 
and experience further improvements in customer satisfaction 
and the enduring focus on high standards to uphold our 
trust principles
with our business markets and customers continuing to experience
rapid change we seek to employ people who are highly talented
knowledgeable about the markets we serve customer focused
adaptable and committed to learning and development our diverse
employee base comprises over 100 nationalities reflecting the
different cultures and markets we operate in and bringing a range 
of perspectives that allow us to develop fresh and innovative ways to
serve our diverse customers this customer focus is also demonstrated
in the improvement in our customer satisfaction scores which reflects
the daily efforts of all our people
as we continue to focus on making our products more competitive
and extending our content we have continued to expand our
bangalore content centre and bangkok development centre during
the year we also established two more strategic centres by the end of
the year the number of people working in our content centre in
gdansk poland and our software development and content
operations centre in beijing grew to almost 400 overall these four
centres accounted for around half of the growth in our employee
numbers during the year balanced with targeted recruitment in our
longerestablished centres new hires into sales and service and into
roles to help us deliver our growth strategies accounted for the other
half reflecting our drive to recruit new talent over 50 of our
employees have joined us in the last five years
employee communications
we use a variety of methods including our intranet to communicate
with our geographically diverse workforce about the company’s
strategy and priorities our ‘daily briefing’ provides an online
multimedia information service covering news and events about the
company and about our people the ceo hosts webcasts
teleconference briefings and question and answer sessions for
employees and also meets informally with groups of reuters
employees around the world at the start of the year the ceo’s
overall mission for the year ahead is explained through the
performance management process objectives in support of that
mission are set for everyone regular meetings are also held between
management employees’ union representatives and other groups of
employees so that employees’ views can be taken into account when
making decisions which may affect their interests reuters european
employee forum operates as a paneuropean works council and the
ceo and other executive directors meet with the forum regularly
employee survey
we carry out annual employee surveys to identify issues that need to
be addressed and areas to build on the findings are communicated
to employees this year we have changed the external benchmarks
against which we measure ourselves instead of comparing ourselves
to companies in transition we now measure ourselves against the
norms of highperforming companies although we have some way to
go we are closing the gap against this more challenging benchmark
the results of our most recent survey november 2006 again showed
year on year improvements across all the groupings that make up our
employee engagement index leadership customer orientation
performance employee commitment and career development there
were also improvements in every category covered by the survey see
the ‘business review’ on page 12 for more information
we have very strong scores on items related to the company brand
and values – the three highestscoring statements were “i fully support
the values for which reuters stands” 90 favourable response “i am
proud to be associated with reuters” and “reuters provides a working
environment that is accepting of ethnic differences” both 89
favourable response highlighting areas for improvement employees
reinforced the need for further organisation simplification and
improvements in performance management the glt has put in place
a range of initiatives to continue to address these issues in 2007 reuters group plc annual report and form 20f 2006
48 company information continued
talent and performance management
we remain committed to retaining and developing our talent our
companywide talent review process updated in 2006 involves
management teams openly reviewing their people this enables us to
identify our highest performers and strongest talent and to create
tailored plans to develop them these processes covered nearly 6000
people worldwide in 2006 we report regularly to the board on these
activities and the board also reviews our succession plans for our most
critical roles to ensure that we have sufficient depth and breadth in
our most senior talent pools see pages 22–23 for further information
challenging ourselves to higher performance as a company has been
mirrored by a renewed focus on the importance of performance
management for individuals new training has been made available to
managers and in the lead up to annual performance reviews training
on how to give effective feedback was made available to all
employees
employee development
we are making increasing use of technology to deliver globally
consistent and constantly available learning for employees increasing
amounts of our training for frontline employees focuses on our
customers their workflows and their needs rather than simply our
products – and certification programmes ensure that the product and
market knowledge of our customerfacing employees is kept upto
date and tested on a regular basis
we recognise that employees benefit from developing their team
building and leadership skills through participation in activities that
strengthen reuters relationships with the communities in which it is
involved for more information see ‘reuters in the community’ on
pages 49–50
in 2006 we substantially increased the amount of development for 
our managers with new programmes aimed at middle and emerging
managers to complement the first level manager programme that was
rolled out in 2005 in addition during the year we introduced a suite
of elearning modules that support managers new to reuters
regardless of their level
our innovation programme launched in december 2005 see page 45
for more information provides opportunities for talented and
ambitious employees to develop their entrepreneurial skills by taking on
challenging roles as members and leaders of innovation project teams
employee safety
we recognise the courage and professionalism shown by our
employees operating in conflict zones we regularly review our
policies training and procedures for all employees we have
reaffirmed the standing instructions to our employees to avoid risks
wherever possible and we provide hostile environment training
protective equipment and post trauma training programmes to 
all employees who may need them
we have also reviewed and upgraded our readiness to protect
employee safety in the event of a range of situations from terrorist
activities to a potential avian flu pandemic
equal opportunities and diversity
we have extensive fair employment practices in place and with the
support of our global diversity advisory council we are working to
make reuters an increasingly inclusive company the council is
chaired by the ceo and serves as an advisory board to the glt 
on issues related to diversity
in 2006 we initiated a global reverse mentoring programme in which
glt members were paired with more junior diverse employees with
the aim of increasing their awareness of diversity issues a regional
version of this programme has just completed its fourth cycle in the
us
our policy is that the selection of employees including for
recruitment training development and promotion should be
determined solely on their skills abilities and other requirements
which are relevant to the job and in accordance with the laws in the
country concerned our equal opportunities policy is designed
among other things to ensure that people with disabilities and other
underrepresented groups are given the same consideration as others
and enjoy the same training development and prospects as other
employees we have successfully retained staff who have become
disabled as well as integrating those who are disabled when they join
the company this has been achieved by using technological solutions
and redesigning the way jobs are handled enabling individuals to
contribute actively to meeting the needs of our business
our commitment to diversity has been formally recognised in several
countries for example in the uk we have been awarded the two
ticks disability symbol user status which recognises our good
practice in employing disabled people and reinforces our
commitment to creating a more diverse workforce reuters is also a
member of the employers forum for disability and we have made use
of the services of both abilitynet which supplies technology for
disabled users and employment opportunities a uk charity helping
people with disabilities to find and retain work at our bangalore
business service centre we have started to work with enable india an
organisation which helps people with disabilities to find jobs
we support the principles incorporated in south africa’s broadbased
black economic empowerment bbbee act of 2003 and recognise our
responsibilities as an employer to comply with both the spirit and the
letter of all relevant bbbee legislation and development initiatives we
have a plan in place to achieve full compliance with the act including
employment equity skills development preferential procurement
enterprise development and corporate social investment
04 our commitment to ethics 
and compliance
we run our business with independence freedom from bias and
integrity we endeavour to do the right thing in all that we do
adhering to the values set out in the trust principles our code of
conduct and the company’s policies while we comply with the
different laws and rules that apply to us in the countries where we
operate the company’s policies cover a wide range of subjects and
include policies which give guidance to our employees in fair dealings
with customers suppliers governments competitors and each other
the policies are made available to employees through a ‘policy
gateway’ which is a centralised online depositary of the policies and
guidance on how to apply them
our efforts to maintain an environment at reuters that promotes and
protects our values is overseen by a global ethics and compliance
steering group chaired by the general counsel and company
secretary which reports to the audit committee and periodically briefs
senior management and the board as part of this global programme
we train our employees on key ethics and compliance areas through reuters group plc annual report and form 20f 2006
49 company information and ofr
online training programmes and facetoface sessions provide an
anonymous and confidential system for staff to report concerns without
the threat of retaliation investigate and take appropriate measures
when compliance issues are raised and periodically assess the efficacy
of the programme as a whole on an individual level ethics and
compliance aspects are incorporated into our performance
management system as we understand that each of us at reuters must
uphold the values and principles that have served reuters well for
so long
05 corporate responsibility
in our reporting on corporate responsibility we have sought to comply
with the association of british insurers’ guidelines on responsible
investment disclosure in this annual report environmental matters are
covered in the ‘environmental impact’ section see page 50 social
matters are reported under ‘people’ see page 47 and ‘reuters in the
community’ see page 49 and governance matters are covered in the
governance section see pages 38–43
corporate responsibility within reuters is established as the way we
carry out our business practices and conduct ourselves responsibly
throughout our daytoday activities as determined by the trust
principles we steer our corporate responsibility strategy through our
corporate responsibility advisory board established in 2003 which
comprises customer supplier investor and employee representatives
the advisory board considers workplace marketplace environment
and community issues of relevance to our business and our
employees and it is chaired by the general counsel and company
secretary who represents it on the glt and to the board as part of
the risk management process which operates throughout the
company when relevant environmental social and governance risks
are identified and mitigation plans are put in place however given
the nonindustrial nature of our business we have just begun to
collect base data about our environmental impact to assess the risks
and opportunities presented we have more work to do including
implementing an environmental impact recording system to acquire
this information further information about reuters risk management
processes is set out on page 41
in 2006 we set the following corporate responsibility objectives
• employees increase employee satisfaction and develop mentoring
programmes and affinity groups to raise awareness of diversity and
inclusion issues
• marketplace develop an ethical code for our suppliers to adhere 
to when working with us
• community increase employee participation in our community
volunteering programme to 18 of employees 2005 12
• environment raise awareness on environmental issues with
customers through our reporting from around the world on
environmental matters and with employees through a green
week to inform employees about how individual behaviours at 
work affect the environment and
• governance implement changes prompted by the 2005 board
effectiveness review and refresh the governance framework at
belowboard level
during the year we met each of these objectives
for 2007 our objectives include
• embedding our supply chain ethical code into our daytoday sourcing
activities for information on the code see supply chain on page 50
• raising employee participation in community engagement
programmes to 20 worldwide by focusing on staff development
opportunities and involvement with environmental causes
• extending best practice in health and safety and family friendly
policies to our operations worldwide
• implementing an environmental management system for recording
reuters impact on the environment
• publishing a document explaining and positioning reuters
corporate responsibility programme to employees and external
audiences
we are conscious that our system for measuring the impact of our
corporate responsibility initiatives can be further developed in 2006
we used the london benchmarking group reporting model for the
first time to calculate our contributions to good causes this model
provides a standardised way of managing and measuring a company’s
community involvement
reuters is included in the dow jones sustainability index the
ftse4good index the ethibel sustainability indices and the ethibel
pioneer investment register reuters hong kong has been accredited
with ‘caring company’ status for the third year running by the hong
kong council of social service
we make extensive information about our corporate responsibility
programme available through our website
reuters in the community
we support a variety of community initiatives and charitable causes
through the work of reuters foundation and the volunteering efforts
of our employees around the world reuters foundation
wwwfoundationreuterscom continues to focus on areas where
reuters expertise in information gathering and communications can
be put to use in ways which will benefit the communities in which 
we operate across the world
during the year the foundation offered training opportunities to
journalists and humanitarian workers from all over the world providing
journalism courses for over 750 journalists and media and
communications skills courses for over 550 aid workers from un
agencies in february 2006 reuters became a member of the global
business coalition on hivaids an organisation which aims to
increase the range and quality of business sector aids programmes in
the workplace and in the community to build on our work in this area
reuters foundation ran its fourth annual workshop on hivaids
reporting and hosted a panel debate in london on ‘keeping the
spotlight on hivaids’ looking at the role of the media
the reuters institute for the study of journalism was officially
launched by lord patten chancellor of oxford university in
november 2006 the institute will be a meeting point between
academia and practising journalism and will provide a detached and
informed perspective on the practice and impact of journalism
sponsored by reuters foundation the institute builds on the
partnership created by the reuters foundation journalists fellowship
programme at green college oxford reuters foundation will
provide £175 million over five years to fund the international research reuters group plc annual report and form 20f 2006
50 company information continued
centre its activities will include both short and longterm research
seminars conferences and debates its aim is to identify and
understand the issues that journalism raises worldwide
reuters alertnet established by the foundation in 1997 enables relief
agencies and the public to share information about emergencies and
associated relief efforts in addition to carrying breaking news on
emergencies the site also helps to ensure that disasters forgotten by
the mainstream media are kept in the headlines
mediabridge a project designed to improve news coverage by
providing online training for reporters and detailed briefings on
countries and issues was launched in july 2006 it is jointly funded by
reuters and the uk department for international development
reuters foundation also sponsors the reuters foundation digital
vision program at stanford university which enables technologists and
other social entrepreneurs to work at stanford and in the field for an
academic year on projects designed to use technology to address
issues in the developing world
all employees may take one day of company time each year to
engage in community activities we focus on these activities during
our annual community events week programme in 2006 over 3000
employees from 58 locations participated sharing their skills on
projects ranging from hosted school visits training workshops for
community groups and fundraising work 
reuters volunteers also continued to work on house building projects
run by habitat for humanity in the twelve months to march 2007
volunteers worked on projects in sri lanka india new orleans and
south africa
we also operate programmes in the us and uk which match the
charitable donations and fundraising efforts of our employees under
these schemes we matched gifts of time and money amounting to
£30000 in the uk and just over 171000 in the us a similar scheme
for employees across asia was also launched in 2006
charitable cash donations totalled £18 million during 2006 2005 
£17 million
it is the group’s policy not to make political contributions and none
were made in 2006
environmental impact
we are classified by ethical investment research services eiris as
belonging to a sector with low environmental impact
we recognise that our business has a role to play in the effective
dissemination of environmental information we have a network of
around 50 reuters journalists who are an authoritative resource on
environmental issues with a special focus on issues such as global
warming fossil fuel use and population growth we also share our
skills in the communication of environmental issues through the work
of reuters foundation working with com alliance a group of
international organisations that embraces and supports sustainable
development projects in 2006 and 2007 we are providing nine courses
for journalists on environmental topics and a programme to prepare
journalists for coverage of the g8 climate change dialogue
we recognise we have a responsibility to seek to reduce our impact
on the environment by managing our facilities efficiently and by
raising employee awareness of environmentally friendly choices at
work at home and when travelling we have signed up to the new
global 3c combating climate change initiative led by swedish
energy company vattenfall so that by engaging with thought leaders
in this area we can increase our understanding of alternative resource
efficient technologies there may be a role for these in the operation
of our data centres which account for a significant proportion of our
overall energy consumption
during 2006 we worked with bureau veritas an independent
environmental consultancy to identify the indicators we should track 
in order to measure our environmental impact these are
• energy total electricity consumption percentage of green tariff
electricity purchased
• greenhouse gas emissions co2 total volume of carbon dioxide
equivalent produced
• water total consumption
• waste total waste produced total waste recycled waste recycled
as a percentage of total produced
• paper total quantity of paper purchased and percentage of which
containing recycled content
in 2006 we purchased a webbased environmental management
system which we will implement in 2007 enabling us to collect data
for the metrics identified above for our key office and data centre
locations and to report the consolidated data periodically this will
help us assess our environmental impact and set targets to reduce it
we recognise our business air travel has an impact on the
environment in 2006 we reduced it by 10 and wherever possible
we use alternatives to business travel including video and
teleconferencing in 2007 we will pilot the use of carbon offsets for
air travel by some of our global groups
we continue to hold our annual staff awarenessraising event green
week delivering information to staff in a variety of ways including
films visits blogs fundraising events intranet briefings exhibitions
and competitions over 15 of staff from 18 locations took part in the
2006 week changes arising from green week 2006 included
improvements to waste streaming in our new york office and a
programme of printer and fax machine reduction in our london
offices the initiative will be expanded in 2007 to deliver a 12month
rolling programme of green weeks around the world
06 supply chain
sourcing
as a global company we source goods and services from an extensive
range of suppliers over the last 4 years we have reduced our supplier
list despite increasing the range of services we outsource in 2006 3
of vendors accounted for 85 of our third party spend the functions
we outsource currently include telecommunications and network
services travel print services it support and elements of back office
administration in 2006 we streamlined our sourcing operations into
one global function excluding content sourcing which is managed by
our content group during the year we received chartered institute
of purchasing  supply certification for excellence in our sourcing
processes
in addition to producing content inhouse we aggregate and
distribute data sourced from 250 exchanges and 6000 contributors
within our products our extensive global customer base and reuters group plc annual report and form 20f 2006
51 company information and ofr
distribution network make us an attractive distribution partner for
content providers we are implementing a content supplier
management programme to raise the standard of contributed content
to a level which meets our customers’ high expectations
for more information see ‘overview of divisional performance’ on
page 58
supply chain ethical code
as a company we are committed to developing relationships with
suppliers whose standards are as high as our own in september 2006
we launched our supply chain ethical code which forms the basis of
our agreement with suppliers based on the recognised and well
regarded ethical trading initiative base code our code endorses
expected standards of behaviour and gives us an opportunity to drive
our commitment to ethical and environmental improvements and
demonstrate a reduction of risk through our supply chain on a global
basis suppliers will be required to confirm their adherence to the
code when selected as a supplier of goods and services to reuters 
if a supplier is found to be noncompliant we will require it to achieve
compliance within a reasonable time frame and we will work with it to
assist this process
supplier payment terms
we agree terms of transactions including payment terms with
suppliers in advance payment terms reflect country or regional norms
throughout the world in 2006 we focused on cash management
clarifying our terms with suppliers our policy is to make payments in
accordance with the agreed terms provided that suppliers have also
acted in accordance with them in the uk we have signed up to the
better payment practice code group trade creditors at 31 december
2006 were equivalent to 13 days’ purchases during the year 2005 2
days the company had no trade creditors at 31 december 2006 or 
31 december 2005
communications networks
our financial and media products are mainly delivered to customers
over private secure highspeed communications networks however
the public internet is becoming more accepted in many parts of the
world and we use it extensively for our consumer content and for
other content that does not require ultralow latency during 2005 we
sold our network servicesfinancial extranet subsidiary radianz a
former joint venture with equant nv to bt at the same time we
entered into an eight and a half year outsourcing deal with bt as a
result of which bt provides the majority of our networks this
outsourcing deal will result in the migration of all products to ipbased
services it will enable us to deliver greater resilience capability and
flexibility through the use of industry standards we have major
technical centres in the asian european and american time zones
supported by smaller local data centres the data centres are linked
by communications services provided principally by btradianz see
above and savvis inc savvis the services agreements with
btradianz and with savvis are important to our ability to deliver
products and services to customers summaries of these network
services agreements and the radianz purchase and sale agreements
are given on page 152
07 governmental regulation
we are regulated by several bodies in the various jurisdictions in
which we operate
under the provisions of the financial services and markets act 2000
reuters limited is regulated and authorised as a service company by
the uk financial services authority fsa reuters transaction services
limited rtsl through which we offer our foreign exchange matching
products equities order routing and our new suite of next generation
transaction products such as reuters trading for fixed income and
reuters trading for exchanges is also subject to regulation by the
fsa since 1 april 2004 rtsl has been classified by the fsa as an
alternative trading system ats in accordance with the passporting
provisions of the eu investment services directive rtsl provides its
services throughout all member countries of the european economic
area rtsl is also subject to similar regulatory approvals in australia
hong kong and singapore where it is approved by the australian
securities and investments commission the hong kong monetary
authority and securities and futures commission respectively and by
the monetary authority of singapore
fxmarketspace limited our 5050 joint venture with the cme is
regulated by the fsa as an ats
rtsl’s sister company in the united states reuters transaction
services llc rts llc is responsible for an equity order routing and
indications of interest network it is also licensed to offer trading in
other instruments such as interest rate swaps rts llc is subject to
regulation by the national association of securities dealers inc
nasd for its equity derivatives products as offered through reuters
trading for exchanges rts llc has also been approved by the
national futures association and is a member of the commodity
futures trading commission
to comply with antimoney laundering regulations and to reduce the
opportunity for reuters transactions products to be used as a conduit
for money laundering operations all our regulated subsidiaries
operate appropriate ‘know your customer’ systems and controls
08 supplementary information
details of our registered office and headquarters can be found 
on page 146
details of substantial shareholdings can be found on page 144
details of the waiver of dividends can be found in note 32 on 
page 119
details of our share buyback can be found on page 149
details of our research and development activity and expenditure 
can be found on pages 79 85 and 93–94
the auditors pricewaterhousecoopers llp  have indicated their
willingness to continue in office and a resolution that they be
reappointed will be proposed at the agm to be held on 26 april 2007 reuters group plc annual report and form 20f 2006
52 selected financial highlights
consolidated income statement data
for the year ended 31 december
£m except per share data notes 2006 2005 2004
amounts in accordance with ifrs
continuing activities
revenue 2566 2409 2339
operating profit 256 207 194
profit before tax 313 238 396
profit after tax 293 229 356
profit from discontinued activities 12 253 19
profit for the year 305 482 375
basic earnings per ordinary share 236p 326p 260p
basic earnings per ordinary share – continuing activities 226p 163p 254p
diluted earnings per ordinary share 231p 317p 254p
diluted earnings per ordinary share – continuing activities 222p 159p 248p
basic earnings per ads 1 1419p 1958p 1561p
basic earnings per ads – continuing activities 1 1356p 978p 1527p
diluted earnings per ads 1 1387p 1903p 1522p
diluted earnings per ads – continuing activities 1 1331p 954p 1488p
dividends declared per ordinary share 2 1025p 100p 100p
dividends declared per ads 2
expressed in uk currency 615p 600p 600p
expressed in us currency 1151c 1114c 1058c
weighted average number of ordinary shares in millions 1297 1396 1400
the selected financial information set out below is derived from the
consolidated financial statements the selected financial data should
be read in conjunction with the financial statements and related notes
pages 75–128 as well as the ofr on pages 54–72
prior to 2005 the group prepared its audited annual financial
statements under uk generally accepted accounting principles uk
gaap from 1 january 2005 the group has been required to prepare
its annual consolidated financial statements in accordance with
international financial reporting standards ifrs and international
financial reporting interpretations committee ifric interpretations
as adopted by the european union eu and those parts of the uk
companies act 1985 applicable to companies reporting under ifrs
the financial statements take account of the requirements and options
in ifrs 1 ‘firsttime adoption of international financial reporting
standards’ as those requirements relate to the 2004 comparatives
included in the financial statements
ifrs differs in certain respects from accounting principles generally
accepted in the united states us gaap the material differences
between ifrs and us gaap relevant to the group are explained 
on pages 129–133
the consolidated financial statements of the group included in this
annual report are presented in pounds sterling £ on 31 december
2006 the noon buying rate in new york city for cable transfers in
foreign currencies as announced for customs purposes by the federal
reserve bank of new york was 196  £1 on 9 march 2007 the noon
buying rate was 193  £1 additional information on exchange rates
between the pound sterling and the us dollar is provided on page 149 consolidated income statement data continued
for the year ended 31 december
£m except per share data notes 2006 2005 2004 2003 2002
amounts in accordance with us gaap
continuing activities
revenue 2566 2503 2370 2669 2955
incomeloss before taxes on income 343 207 501 8 198
income after taxes on income 294 211 395 23 168
incomeloss after taxes including minority interest from discontinued activities 12 185 44 51 273
net incomeloss 306 396 439 28 105
basic earningsloss per ordinary share 236 284p 314p 20p 75p
basic earnings per ordinary share – continuing activities 227 151p 281p 16p 120p
diluted earningsloss per ordinary share 232 276p 305p 20p 75p
diluted earnings per ordinary share – continuing activities 223 147p 274p 16p 120p
basic earningsloss per ads 1 1418p 1702p 1882p 120p 448p
basic earnings per ads – continuing activities 1 1360p 908p 1685p 98p 721p
diluted earningsloss per ads 1 1393p 1654p 1832p 120p 448p
diluted earnings per ads – continuing activities 1 1336p 882p 1643p 97p 721
dividends declared per ordinary share 2 1025p 100p 100p 100p 111p
dividends declared per ads 2
expressed in uk currency 615p 600p 600p 600p 667p
expressed in us currency 1151c 1114c 1058c 1051c 996c
weighted average number of ordinary shares in millions 1297 1396 1400 1396 1395
consolidated balance sheet data
at 31 december
restated
3
£m 2006 2005 2004
amounts in accordance with ifrs
total assets 1920 2137 2580
net assets 172 511 570
shareholders’ equity attributable to the parent 172 511 371
share capital 496 467 455
£m 2006 2005 2004 2003 2002
amounts in accordance with us gaap
total assets 2022 2326 2743 3280 3789
shareholders’ equity 281 705 568 514 804
notes
1 each ads american depositary share represents six ordinary shares
2 dividends declared for 2002 include uk tax credits dividends declared for 2003–2006 exclude uk tax credits amounts receivable could be higher for us shareholders who have elected to retain
benefits of the old usuk tax treaty for further information relating to dividends and the uk taxation of dividends see page 145
3 the 2005 ifrs balance sheet has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78 the impact of
recognising these commitments is to increase current liabilities and to decrease shareholders’ equity in accordance with ifrs at 31 december 2005 by £59 million
reuters group plc annual report and form 20f 2006
53 company information and ofr reuters group plc annual report and form 20f 2006
54 operating and financial review
financial review
nongaap measures
a number of measures used in the following commentary and
elsewhere in this report are ‘nongaap’ figures which are business
performance measures used to manage the business that supplement
the ifrsbased headline numbers these include ‘underlying change’
‘trading costs’ ‘trading profit’ ‘trading cash flow’ ‘adjusted eps’ ‘free
cash flow’ and ‘net debtnet funds’ brief descriptions of these terms
are provided below a more detailed discussion of these nongaap
measures including the rationale for using them and reconciliations 
to the most directly comparable ifrs indicator is provided on 
pages 67–72
underlying change is calculated by excluding the impact of currency
fluctuations and the results of acquisitions and disposals 
constant currency change is calculated by excluding the impact of
currency fluctuations
trading costs are calculated by excluding the following from operating
costs from continuing operations restructuring charges associated
with reuters completed business transformation plans which include
fast forward a three year business transformation programme
completed in december 2005 and acquisitions impairments and
amortisation of intangibles acquired via business combinations and
fair value movements included in operating costs and adding back
foreign currency gains and other income both of which are included 
in other operating income
trading profit is calculated by excluding the following from operating
profit from continuing operations restructuring charges associated
with fast forward and acquisitions impairments and amortisation of
intangibles acquired via business combinations investment income
profits from disposals of subsidiaries and fair value movements
trading margin is trading profit expressed as a percentage of revenue
trading cash flow is calculated by including capital expenditure and
excluding the following from cash generated from continuing
operations restructuring cash flows associated with completed
business transformation plans which include fast forward and
acquisitions cash effect of derivatives used for hedging purposes and
cash flows which are either discretionary in nature or unrelated to
ongoing recurring operating activities such as special contributions
toward funding defined benefit pension deficits acquisitions and
disposals and dividends paid out by reuters
adjusted eps is calculated as basic eps from continuing operations
before impairments and amortisation of intangibles acquired via
business combinations investment income fair value movements
disposal profitslosses and related tax effects
free cash flow measures cash flows from continuing operations other
than those which are either discretionary in nature or unrelated to
ongoing recurring operating activities such as special contributions
toward funding defined benefit pension deficits acquisitions and
disposals and dividends paid out by reuters
net debtnet funds represents cash cash equivalents and shortterm
deposits net of bank overdrafts and other borrowings
group performance
summary results 2006 2005 2004
year to 31 december £m £m £m
continuing operations
revenue 2566 2409 2339 
operating costs 2351 2251 2187
other operating income 41 49 42
operating profit 256 207 194
net finance costs 15 12 12
profit on disposal of associates 
joint ventures and availableforsale 
financial assets 76 38 203
share of posttax lossesprofit
from associates and joint ventures 4 511
profit before tax 313 238 396
taxation 20 9 40
profit for the year from continuing 
operations 293 229 356
profit for the year from discontinued 
operations 12 253 19
profit for the year 305 482 375
basic eps 236p 326p 260p
adjusted eps 171p 138p 118p
revenue costs and profit 2006 2005  actual underlying 2004 
year to 31 december £m £m change change £m
recurring 2363 2235 6 4 2158
usage 132 104 26 24 92
outright 71 70 3 4 89
total revenue 2566 2409 7 5 2339
operating costs 2351 2251 4 2187
operating profit 256 207 24 194
operating margin 10 9 – 8
trading costs 2258 2075 9 7 2013
trading profit 308 334 8 11 326
trading margin 12 14 – – 14
 2005 and 2004 have been restated to reclassify £7 million and £6 million respectively of recurring
revenue to usage revenue
revenue
full year revenue grew 65 to £2566 million 2005 £2409 million
exchange rate movements accounted for 03 percentage points of this
growth and acquisitions mainly the full year impact of the 2005
acquisition of telerate accounted for 14 percentage points of revenue
growth
on an underlying basis adjusting for exchange rate movements and
the impact of acquisitions and disposals revenue growth was 48
core plus initiatives contributed 13 percentage points £32 million to
revenue growth all four elements of core plus – electronic trading
high value content new enterprise services and new markets –
contributed to revenue growth
volume growth the 2006 price increase and recoveries exchange fees
and specialist data accounted for 35 percentage points of growth
the key drivers of volume growth were new sales and migrations to
reuters 3000 xtra reuters knowledge principally on the buyside
enterprise datafeeds and trade and risk management software
recurring revenue which represented 92 of our revenue in 2006
93 in 2005 was £2363 million 2005 £2235 million this represents
an increase of 6 on an actual basis 4 underlying compared 
to 2005 reuters group plc annual report and form 20f 2006
usage revenue 5 of our revenue in 2006 4 in 2005 grew by 26
24 underlying to £132 million 2005 £104 million compared to 2005
outright revenue 3 of our revenue in 2006 3 in 2005 totalled
£71 million compared to the £70 million of 2005
revenue grew in all divisions as discussed more fully in the ‘divisional
performance’ on pages 58–62
revenue also grew in all geographical regions the americas saw
growth of 9 underlying 8 driven by strong sales of enterprise
solutions and media services and good progress with reuters
knowledge asia grew 7 underlying 6 benefiting from improved
trading conditions in japan marketleading positions in china and
india and the inclusion of telerate revenues for the full 2006 year
europe middle east  africa revenues grew 5 underlying 3 
with strong trading in the nordic region russia and the gulf
counterbalanced by consolidation in the german swiss and italian
markets
in the 2005 annual report and form 20f the 2006 outlook noted an
expected acceleration of revenue growth through reuters core plus
investment programme against a backdrop of favourable market
conditions and targeted total revenue growth of around 5 this
target included 2005 acquisitions and a percentage point of growth
from core plus but excluded currency effects constant currency
revenue growth for 2006 of 62 was ahead of our target 
operating costs and trading costs
total operating costs were £2351 million an increase of 4 from 2005
the drivers of this increase are largely explained in the context of the
movement in trading costs as defined above and reconciled to
operating costs on page 70 trading costs totalled £2258 million in
2006 2005 £2075 million up 9 on 2005 new investment in core
plus growth and transformation initiatives net of early savings
contributed £109 million to cost growth in 2006 inflation added
approximately 3 to base costs and additional costs of £21 million
were incurred to invest in service resilience acquisitions added a
further £30 million principally telerate and data recoveries costs
added a further £25 million offsetting these key drivers of cost
increases were savings from the fast forward programme totalling
£80 million as anticipated in the 2006 outlook included within the
2005 annual report and form 20f
trading cost increases were partially offset by much lower fast
forward restructuring and acquisition integration costs total
restructuring charges in 2006 were £13 million compared to
£112 million in 2005 2005 charges included £94 million in respect of
the fast forward restructuring programme which completed at the
end of 2005 and £18 million in respect of telerate acquisition
integration the £13 million charged in 2006 relates only to acquisition
integration principally telerate
operating costs also include the impact of movements in the fair value
of derivatives and other financial assets including embedded derivatives
within our revenue and supplier contracts movements in fair values
added £25 million to total operating costs in 2006 compared to £16
million in 2005
operating profit and trading profit
operating profit totalled £256 million in 2006 2005 £207 million 
an increase of £49 million over 2005 largely reflecting the lower fast
forward restructuring costs
trading profit as defined above and reconciled to operating profit on
page 69 was £308 million in 2006 2005 £334 million trading profit
was largely driven by revenue growth the last tranche of fast forward
savings continued tight cost control and £10 million of benefit from
acquisitions however these benefits were more than offset by the
£77 million net new investment to drive core plus taking into account
revenues and early cost savings generated by the initiatives during 
the year
the business delivered an operating profit margin of 10 2005 9
and a trading margin of 12 2005 14
profit for the year from continuing operations
profit for the year from continuing operations was £293 million 2005
£229 million the yearonyear increase of £64 million is largely due 
to the improved operating profit discussed above and the increase in
profits from asset disposals the sale of the majority of our stake in
factiva realised a profit of £76 million whereas the £38 million of
disposal profits in 2005 came largely from further sales of our stake 
in tibco software inc tsi
net finance costs of £15 million increased by £3 million over the
previous year reflecting the net outflow of cash for the share buyback
programme and special contributions made towards funding the
majority of the deficit position on two uk defined benefit pension
schemes
income from our associates and joint ventures in 2006 generated a loss
of £4 million compared to a profit in 2005 of £5 million the losses in
2006 largely reflected the expected initial losses in reuters new
investments in fxmarketspace and times now along with setup
costs incurred to establish fxmarketspace profits in 2005 largely
reflected the results of factiva which ceased to be accounted for as
a joint venture in october 2006
the tax charge for the year was £20 million compared to £9 million in
2005 as in 2005 the current year has benefited from the settlement of
prior year tax matters a reconciliation of the actual tax charge to the
tax charge expected by applying the standard 30 uk rate of
corporation tax to the reported profits is provided in note 6 to the
financial statements on pages 86–87
profit for the year from discontinued operations
we have no activities which are required to be classified as
discontinued operations in 2006 an additional gain of £12 million has
been recognised in 2006 arising from the disposal of instinet group in
2005 compared to the £253 million profit recognised in 2005 the 2005
result was largely made up of the posttax profit of £191 million on the
disposal of instinet group and £68 million profit after tax from instinet
group’s business operations prior to its sale in december 2005
earnings per share
profit for the year was £305 million 2005 £482 million resulting in
basic eps of 236p down 9p from the prior year mainly due to the
decrease in profits from disposals for the period adjusted eps as
defined above and reconciled to basic eps on page 69 was 171p in
2006 up 24 from the previous year reflecting lower net restructuring
charges and a reduction in the number of shares in circulation due to
the share buyback programme
55 company information and ofr reuters group plc annual report and form 20f 2006
56
summarised cash flow and free cash flow
summarised group cash flow 2006 2005 2004
year to 31 december £m £m £m
net cash flow from operating activities 258 253 226
acquisitions and disposals 2 206 384
purchases of property plant and 
equipment and intangibles 228 185 136
proceeds from sale of property 
plant and equipment 5 366
dividends received 3 55
proceeds from issue of shares 32 10 6
share buyback 527 223 –
equity dividends paid to shareholders 134 140 140
equity dividends paid to minority interests – 23 –
other movements 7 21 8
movement in net debtfunds 586 73 403
opening net fundsdebt 253 326 77
closing net debtfunds 333 253 326
reconciliation of cash flow from 
continuing operations to free cash flow 
from continuing operations 2006 2005 2004
year to 31 december £m £m £m
cash flow from continuing operations 311 268 307 
net interest paid 19 7 19 
tax paid 34 11 34
special contributions to pension schemes 187 ––
capital expenditure 228 178 117
proceeds from sale of property plant 
and equipment 5 3 49 
dividends received 3 54
interim funding repayment from telerate – 18 18 
repayment of funds to btc – 26 –
free cash flow from 
continuing operations 225 88 208
note refer to page 72 for reconciliation to group cash flows
cash generated from continuing operations was £311 million compared
to £268 million in 2005 the yearonyear improvement of £43 million
was driven by lower restructuring charges than 2005 and savings
achieved under the fast forward programme it was also driven by a
movement in working capital outflow of £50 million 2006 £115 million
2005 £65 million although excluding the contribution of £187 million
towards funding pension deficits working capital improved significantly
on 2005
free cash flow from continuing operations was £225 million 
2005 £88 million this reflects lower cash restructuring charges and
management action to improve working capital partially offset by
higher capital expenditure cash tax and interest charges movements
in working capital were £111 million positive although some of this
improvement was due to timing around yearend cash flows which will
reverse in 2007
investment in software and development projects has increased by 
£66 million reflecting higher levels of development under core plus
tangible capital spend has reduced by £16 million reflecting the
completion in 2005 of the move to reuters head office in london’s
canary wharf partially offset by new investment in data centres total
capex of £228 million was higher than the £220 million anticipated in
the 2006 outlook in the 2005 annual report and form 20f reflecting
additional investment to improve data centre resilience
trading cash conversion from continuing operations ie trading cash
flow divided by trading profit in 2006 was 111 2005 77 with the
increase in capital expenditure more than offset by working capital
improvements
net debt was £333 million compared to net funds of £253 million in
2005 a movement of £586 million the significant movements in net
debt include
• free cash inflows of £225 million as noted above
• special contributions of £187 million towards funding the deficit 
in two uk defined benefit pension schemes
• the ongoing cost of the share buyback programme amounting 
to £527 million
• dividend payments of £134 million and
• net outflow from acquisitions and disposals of £2 million including
£79 million from the disposal of factiva
dividends
dividends paid in 2006 totalled £134 million the final dividend to 
be proposed in respect of 2006 is 69p per share an increase of 12
on the prior year reflecting our continued confidence in the future
performance of our business the total dividend in respect of 2006 
is 11p an increase over 2005 of 10
we are committed to maintaining a progressive dividend policy which
reflects our longterm earnings potential whilst moving towards
minimum dividend cover of at least two times based on adjusted
earnings
balance sheet
the net assets of the group are £172 million a reduction of £339 million
on the previous year this reduction primarily reflects the return of funds
to shareholders through the share buyback programme
the main movements in the group balance sheet between 2006 and
2005 are
• the capitalisation of property plant and equipment and intangible
assets of £290 million offset by annual depreciation and amortisation
charges of £141 million
• a change in the composition of our net debt net funds in 2005 with
lower cash holdings and higher debt being offset by lower pension
obligations due to the special contributions towards funding the
deficits in two uk defined benefit pension schemes
restated
summarised group balance sheet 2006 2005 2004
year to 31 december £m £m £m
noncurrent assets 1314 1179 1025
current assets 606 957 1410
noncurrent assets classified as 
held for sale – 1 145
total assets 1920 2137 2580
current liabilities 913 797 1249
noncurrent liabilities 835 829 714
liabilities associated with noncurrent 
assets classified as held for sale – – 47
total liabilities 1748 1626 2010
net assets 172 511 570
shareholders’ equity 172 511 371
minority interest – – 199
total equity 172 511 570
operating and financial review continued reuters group plc annual report and form 20f 2006
our largest acquisition during the year was that of application networks
for £22 million which completed in june 2006 other acquisitions
included two small telerate distributor businesses in india and italy 
we also made a number of investments in associates and joint ventures
including a 26 holding in times now of £11 million and an initial
contribution of £8 million to establish fxmarketspace as a joint venture
with the cme an additional £6 million was invested by each partner in
early 2007 towards the total commitment of 45 million for each partner
intended to bring the joint venture to a cash flow positive status the
partners evaluate on an ongoing basis whether additional funding may
be required
disposal activity for the year included the sale of the majority of 
our 50 stake in factiva to dow jones for net cash proceeds of 
£79 million resulting in a gain on sale of £76 million
the 2005 ifrs balance sheet has been restated to recognise
irrevocable commitments to repurchase shares during close periods as
a liability during the closed period following the 2006 year end the
group repurchased 120 million shares 2005 135 million shares 2004
nil under these commitments at a total cost of £53 million 2005 £59
million 2004 £nil the impact of recognising these commitments is 
to increase current liabilities and to decrease shareholders’ equity by
£53 million 2005 £59 million 2004 £nil there is no impact on
reported profit cash flow or earnings per share share repurchases
under the buyback programme totalling £137 million for the period
1 january 2006 to 7 march 2006 which included the £59 million
described above were disclosed previously under note 38 ‘post
balance sheet events’ in the 2005 annual report and form 20f
2007 outlook
in 2007 we expect to deliver underlying revenue growth of 6 or
better in line with our plans for strong sustainable revenue growth in
the medium term assuming continued growth in the financial services
industry trading margins are expected to increase to 13–14 in 2007
putting us on track to achieve our medium term trading margin target
of 17–20 operating margins are expected to perform similarly but
will be subject to additional impact from factors that cannot be
predicted such as fair value movements in embedded derivatives
we expect to keep capital expenditure in 2007 at similar levels 
to 2006
although currency had a negligible effect on trading profit the impact
of sterling strength against the euro and us dollar is expected to be
more material in 2007 if current rates persist this is because major
sources of revenue growth – our largest accounts worldwide for
example – are typically dollar priced while the size of reuters dollar
denominated cost base has reduced at current exchange rates and
currency mix a 5 cent weakeningstrengthening in either the us dollar
or the euro would decreaseincrease trading profit by approximately
£10 million
we will actively manage our capital structure to maintain a strong
investment grade rating of bbbbaa1 and to the extent that we
generate cash surplus to our needs will continue to seek to return 
that cash to shareholders based on current investment plans reuters
expects to increase the buyback during 2007 to £400–£425 million
which includes £250 million remaining of the £1 billion buyback
announced in july 2005 in future share buybacks will be considered
periodically based on business performance investment opportunities
and the bbbbaa1 ratings target
we invested a net £77 million in our core plus initiatives in 2006 taking
into account revenues and early cost savings generated by the
initiatives during the year looking forward our targets for core plus
are that the combination of increased revenues and new cost savings
net of the investment required to deliver these will improve the
impact on trading profit by £60 million in 2007 and by a further 
£105 million in 2008 actual trading profit in each of these years will
also be impacted by other factors such as the performance of our core
business and currency movements
2005 results compared with 2004
revenue
full year revenue grew by 3 to £2409 million 2004 £2339 million
this was our first full year of revenue growth since 2001 on an
underlying basis revenue was approximately the same as in 2004
acquisitions particularly of telerate accounted for most of the
difference between actual and underlying increases with the
remainder due to currency movements in the newly integrated
telerate business sales focus on revenue retention postacquisition
drove better than expected revenue performance
recurring revenue was £2235 million 2004 £2158 million this
represented an increase of 4 on an actual basis 1 underlying
compared to 2004 and was the first time underlying recurring revenue
had grown since 2001
usage revenue grew by 13 to £104 million 2004 £92 million this
was driven by strong performance from reuters transaction services 
as well as higher advertising revenue from reuterscom
outright revenue totalled £70 million 2004 £89 million a decline of
22 compared to 2004 this decline was mainly due to our continued
withdrawal from technology consulting as part of the fast forward
programme which completed in 2005
operating costs and trading costs
total operating costs were £2251 million an increase of 3 from 2004
£2187 million the drivers of the increase are largely explained in the
context of the movement in trading costs as defined above trading
costs were £2075 million in 2005 2004 £2013 million up 3 on an
actual basis flat on an underlying basis demonstrating our continued
cost discipline the differences between the underlying and actual
increases are mostly related to acquisitions principally telerate with
the remainder due to currency movements
additionally fast forward restructuring costs of £94 million were 
£26 million lower than the previous year the fast forward business
transformation completed in 2005 with outsourcing communications to
btradianz further headcount reductions and expansion in bangalore
and bangkok resulting in further annualised savings of £126 million
we also incurred £18 million of acquisition related integration costs
principally relating to telerate we invested £41 million in the second
half of 2005 in core plus transformation projects and growth initiatives
these included investment in new electronic trading products and
rationalising data centres and product development units
operating profit and trading profit
operating profit rose from £194 million to £207 million reflecting
improved trading performance
trading profit was £334 million in 2005 2004 £326 million trading
margin remained at 14 after expenditure on investments in the 
core plus programme
profit for the year from continuing operations
profit in 2005 from continuing operations was £229 million a decrease
from £356 million in 2004 driven by a reduction in profits on asset
reuters group plc annual report and form 20f 2006
57 company information and ofr reuters group plc annual report and form 20f 2006
58
disposal net finance costs were comparable to 2004 at £12 million
due to a similar net debt position throughout the year prior to the
disposal of instinet group the tax charge was £9 million compared 
to £40 million in 2004 mainly due to the benefit of settling prior year
tax matters
profit for the year from discontinued operations
profit from discontinued operations rose from £19 million to £253
million largely due to the posttax profits of £191 million on the
disposal of instinet group and £68 million profit after tax from
instinet’s business operations prior to sale this was partly offset by
losses on the sale of radianz to bt and on the partial disposal of the
group’s interest in bridge trading company btc to instinet group
earnings per share
profit for 2005 was £482 million 2004 £375 million resulting in basic
eps of 326p up 66p from 2004 adjusted eps was 138p up 2p from
2004 reflecting a stronger trading profit and a reduction in the
number of shares in circulation due to the share buyback programme
summarised cash flow
cash generated from continuing operations was £268 million 2004
£307 million and free cash flow was £88 million 2004 £208 million
the yearonyear decline was driven by increases both in capital
investment and restructuring charges higher capital investment
resulted from our move to our london headquarters at canary wharf
steppedup investment in data centres and the capitalisation of
product development and software costs 2005 cash restructuring 
costs were £147 million 2004 £100 million of which £132 million
represented the peak year for fast forward cash charges and the
remainder related mainly to the integration of telerate cash flow in
2004 also benefited from £49 million of proceeds from the sale of
property plant and equipment disposals which did not recur in 2005
net funds were £253 million 2004 £326 million excluding 
£507 million of net funds from instinet group in 2004 2005 shows a 
yearonyear improvement in net debt to net funds this was largely
due to cash flow from operations of £268 million and net cash
proceeds from disposalsacquisitions mainly instinet of £710 million
partially offset by net purchases of assets of £182 million dividend
payments of £140 million and payments made as part of the share
buyback programme of £223 million
dividends
dividends paid were £140 million in 2005 and 2004 the final dividend
was 615p per share in line with 2004
balance sheet
the net assets of the group reduced to £511 million in 2005 from
£570 million in 2004 the main movements in the balance sheet were
• the disposal of instinet group – reducing both total assets and
liabilities upon sale and reducing the minority interest in instinet
group to zero
• the impact of the share buyback programme which decreased
shareholder funds by £283 million which includes £59 million in
current liabilities resulting from irrevocable commitments entered
into during the close period
• an increase in noncurrent liabilities principally reflecting an increase
in net pension obligations from £256 million to £310 million largely
as a result of changes to key assumptions underpinning the net
liability valuation both the rate of return and discount rate
decreased which resulted in a larger present value liability
the largest acquisition in 2005 was telerate for £122 million other
acquisitions included action images and ecowin
disposals included reuters 62 stake in instinet group to nasdaq
prior to this disposal reuters had sold btc to instinet group and had
received a dividend from instinet group following the sale of its lynch
jones  ryan subsidiary to the bank of new york the net proceeds
from all these transactions totalled approximately £630 million
other disposals included the sale of 16 million shares in tsi for
£63 million resulting in a profit of £33 million and the sale of radianz
to bt for £115 million cash resulting in a loss of £4 million
divisional performance
overview
we operate through four business divisions sales  trading research 
 asset management enterprise and media they are closely aligned
with the user communities they serve and they are responsible for
defining building and managing products the business divisions have
profit and loss responsibility revenues and trading profit for the two
years to 31 december 2006 are analysed by business division in the
following sections further information on revenue by division and by
geography is included in note 1 of the financial statements on page 84
during 2006 we transferred our development and data teams to
become part of the business divisions to align these teams more
closely with our divisional plans these plans are being further
strengthened by our investment in the quality and timeliness of
reuters data operationally we have introduced a new endtoend
framework for managing products through their entire lifecycle
simplifying the process and enabling us to make the most of our
resources and maximise the return on our investments
shared infrastructure design is provided by a technical architecture
team tasked with providing technical coherence scale efficiencies 
and compliance with standards
we face competition in most of the market sectors and geographical
areas in which we operate we monitor the competitive landscape
actively in order to be able to respond to market developments
the business divisions serve customers through our global sales and
service operations group which is split into geographic regions the
americas asia and europe middle east  africa in addition we run
our focus group accounts team as a global sales and support channel
for our largest customers locally members of our sales and service
teams work with customers to build relationships and to identify the
correct reuters products to meet customer needs and to feed back
customer needs to the business divisions through regular training
visits our customer training specialists work with endusers to ensure
they get full value from our products in addition we provide product
content and technical support by telephone and email from three
regional hubs one based in each principal time zone we also offer
proactive telephone support and remote learning to help users of our
premium products get the most out of their service to increase
awareness of the latest developments in our product range we have 
a travelling showcase for reuters products called ‘brightspot’
our editorial and data groups support the work of all four business
divisions by reporting producing collecting qualitychecking packaging
and delivering an extensive range of news and financial information
our financial data comes from an array of sources such as exchanges
overthecounter markets our customers research services and other
contributors such as energy and fixed income data providers as well
as from our own news research and data operations
operating and financial review continued reuters group plc annual report and form 20f 2006
our editorial team of 2400 text television and photo journalists aims 
to report the news to the highest standards of accuracy insight and
timeliness representing some 90 nationalities they report from nearly
200 bureaux in 19 languages they filed 3 million news items in 2006 to
customers in the form of text pictures tv  video and graphics
our coverage includes data from 250 exchanges more than 15 million
bonds 250000 foreign exchange and money market instruments and
awardwinning commodities and energy content this is further
complemented by data from around 6000 financial services
contributors in addition our fundamentals and estimates data is
recognised as a leading source of high quality financial information
covering over 45000 companies worldwide
sales  trading division
overview
sales  trading – our largest business division – serves the
information trading and posttrade connectivity requirements of buy
and sellside customers in the foreign exchange fixed income
equities and other exchange traded instruments and commodities
and energy markets the division’s major strategic focus is to become
the leading provider of content and transaction services for traders
and salespeople worldwide across a broad spectrum of asset classes
our customers include market makers sales traders traders at
investment firms and corporate treasurers in addition we continue to
identify opportunities in new asset classes
our premium desktop product is reuters 3000 xtra its users are
financial markets professionals who require a powerful combination 
of deep global crossasset news and content combined with
sophisticated pretrade decisionmaking analytics and trade
connectivity tools it includes reuters messaging which enables 
endusers to interact with their peers in the financial community
our trading suite of products offers trade connectivity electronic
trading orderrouting and posttrade tools to enable customers to trade
with each other and connect their systems to electronic markets we
now have a range of trading and posttrade services for fx and money
markets fixed income and exchange traded instruments our strategic
product set includes reuters dealing 3000 reuters trading for foreign
exchange reuters trading for fixed income and reuters trading for
exchanges through reuters dealing 3000 our customers have access
to a trading community of 18000 fx and money market traders globally
reuters trader is our midtier product which we also offer in versions
targeted at regional markets users of our midtier and domestic
products typically require only a subset of reuters overall content 
and capabilities we are working to complete the migration of our
customers from older products to new reuters trader products 
many of which are browserbased
our sales  trading information products compete with bloomberg
thomson financial sungard telekurs idc and factset as well as
stock exchanges plus a number of smaller local and regional
competitors which offer information products for the financial markets
in the electronic trading business we compete with exchanges
particularly in the energy and commodity markets direct market
access providers such as lava and sonic now owned by banks 
which are also our customers order management system providers
which are increasingly adding information and trading capabilities
singlebank portals and multibank portals such as fx all and other
electronic execution venues such as market axess thomson
tradeweb ebs now owned by icap and bloomberg
financial performance
sales  trading division summary 
operating and trading results 2006 2005  actual underlying
year to 31 december £m £m change change
revenue 1690 1613 5 3
trading costs 1476 1373 8 6
restructuring charges 12 76
other operating income 
in trading costs 20 16
impairments and amortisation 
of business combination
intangibles 17 14
fair value movements 
in expenses 18 16
operating costs 1543 1495 3
other operating income 27 37
operating profit 174 155 13
operating margin 10 10
trading margin 13 15
 in 2006 reuters made changes to the allocation of revenue and trading costs between business
divisions to reflect changes in the management of certain products 2005 comparatives have
therefore been restated to increase sales  trading revenue by £18 million and trading costs by
£19 million 2005 comparatives have also been restated to reallocate £1 million of amortisation
on intangible assets arising on the acquisition of telerate from enterprise to sales  trading in
line with the allocation of revenues from telerate products
reconciliations between the ifrs and nongaap measures are provided on pages 69–72
sales  trading returned to underlying revenue growth in 2006 under
a new management team led by mark redwood the key to profitable
growth lies in focusing on a small number of standard technology
platforms and on highmargin transactionsrelated revenue in 2006
revenue of £1690 million was up 5 on an actual basis and 3 on an
underlying basis after accounting for growth generated by the
acquisition of telerate during 2005 the major drivers of revenue
growth were sales of 3000 xtra helped by favourable market
conditions and transaction revenues helped by strong fx markets
recurring revenue within sales  trading grew 4 on an actual basis
and 2 on an underlying basis the biggest growth driver was reuters
3000 xtra which saw subscription revenue grow by 12 on an actual
basis and 8 on an underlying basis while this increase was driven in
part by migrations from other reuters desktop products the highest
proportion came from new sales benefiting from favourable market
conditions new sales into areas such as credit derivatives and
customers wanting to trade on new transactions services reuters
trader for commodities also saw encouraging growth reflecting
volatile energy and commodities markets
strong foreign exchange markets as well as new services such as prime
brokerage also drove growth of 23 on an actual and underlying basis
in sales  trading usage revenues taking them to £93 million reuters
conversational dealing services also saw revenue growth driven by an
active global market and emerging markets expansion reuters leading
position in fx is creating significant new growth opportunities such as
the fxmarketspace joint venture with the cme
transactions services were the major area of growthfocused core plus
investment in sales  trading during 2006 reuters trading for foreign
exchange saw encouraging volume growth while reuters trade
notification service is beginning to establish itself as an industry standard
for posttrade messaging among fx brokers and their clients the launch
of reuters trading for exchanges which enables customers to transact
exchangetraded instruments was recently boosted by an agreement
with bny convergex to offer its global trading services through this
platform bringing the number of brokers live on the platform to eight
operating costs increased to £1543 million in 2006 up 3 on an
actual basis reflecting an increase in trading costs partially offset 
by lower fast forward restructuring charges
59 company information and ofr reuters group plc annual report and form 20f 2006
trading costs increased to £1476 million in 2006 up 8 on an actual
basis and up 6 on an underlying basis driven by significant
investment in core plus initiatives such as transactions services and
customer service infrastructure the effect of which was offset to some
extent by operating efficiencies and reductions in communications
costs these initiatives are expected to deliver further underlying
revenue growth and margin improvement in 2007 and beyond
a key part of strengthening our position in sales  trading in 2006 was
to migrate former telerate customers to the latest reuters products 
in line with the integration plan the telerate migration was completed
in europe and asia by the end of 2006 and is due to be completed in
the americas and with our largest global customers in 2007 telerate
profits are in line with the original acquisition plan a restructuring
charge of £13 million relating to the integration of telerate was taken
in 2006 with the majority £12 million incurred within the sales 
trading division restructuring charges have reduced significantly
compared to 2005 as the fast forward programme came to an end
in 2006 operating profit was £174 million up 13 the reduction in
the 2006 restructuring charge was the primary driver of this growth 
as increased revenues were partially offset by the cost of core plus
investments trading profit declined by 10 on an actual basis and
17 on an underlying basis
research  asset management division
overview
the research  asset management division focuses on supporting
portfolio managers wealth managers investment bankers research
analysts and corporate executives who make complex financial
decisions outside the trading environment there was a smooth
management transition at year end with michael peace taking over
responsibility for the division on the retirement of julie holland
the research  asset management division is responsible for the
reuters knowledge and reuters wealth manager product families
the reuters knowledge family is targeted at the research and advisory
communities including investment bankers and analysts portfolio
managers company executives and others focused on company and
industryspecific research reuters knowledge offers an integrated
package of public and proprietary information about companies
securities industries and markets plus economic data news and other
content knowledge can be integrated with reuters flagship real time
information desktop product reuters 3000 xtra for users who require
significant realtime deep crossasset coverage or transaction capabilities
the reuters wealth manager family is targeted at wealth managers and
retail brokers who require financial information services that can be
integrated closely into their workflow helping users manage their clients’
portfolios better and allowing more time to concentrate on building
deeper client relationships the reuters wealth manager family includes
content on a wide range of single asset and collective investment funds
provided by our lipper subsidiary lipper is a global leader in the
provision of independent fund research analysis and ratings
as well as its core services the research  asset management division
also receives a share of revenue from reuters 3000 xtra and the
reuters 20003000 range of legacy products by reference to the
nature of the customer taking the product
in the research  asset management arena we compete with
bloomberg thomson financial factset and standard  poor’s as 
well as smaller niche players our lipper funds information business
competes with morningstar plus a number of local domestic players
financial performance
research  asset management 
division summary operating and 
trading results 2006 2005  actual underlying
year to 31 december £m £m change change
revenue 298 258 15 12
trading costs 305 276 10 8
restructuring charges – 11
other operating income 
in trading costs 4 3
impairments and amortisation 
of business combination
intangibles 3 3
fair value movements 
in expenses 3 –
operating costs 315 293 7
other operating income 5 –
operating loss 12 35 63
operating margin 4 13
trading margin 2 6
 in 2006 reuters made changes to the allocation of revenue and trading costs between business
divisions to reflect changes in the management of certain products 2005 comparatives have
therefore been restated to decrease research  asset management revenue by £10 million and
trading costs by £12 million
reconciliations between the ifrs and nongaap measures are provided on pages 6972
the research  asset management division made progress towards
profitability in 2006 with revenues of £298 million up 15 12 on 
an underlying basis beginning to drive more significant economies 
of scale
research  asset management aims to provide independent content
and insight to the following user communities investment banking
investment management  corporates and wealth management
investment banking investment management  corporates were the
major revenue drivers for the division in 2006 with total revenues
growing 27 on an actual basis and 22 on an underlying basis to
£171 million revenues were driven by the addition of 3000 standalone
reuters knowledge positions bringing the total to 14000 and the
sales of reuters knowledge embedded in xtra and datafeeds the
superior quality of reuters company fundamentals and estimates data
was key to driving growth in both feeds and desktops reuters also
benefited as customers broadened their global coverage by providing
indepth information on emerging markets such as china and india
revenue from the wealth management customer base grew 2 on an
actual basis and 1 on an underlying basis to £127 million ongoing
management actions to restructure unprofitable low tier desktop
business limited top line growth but moved this part of the business
closer to profitability customer demand is growing for datafeed and
online solutions within their wealth management workflow and for
lipper funds information simplification will remain a key wealth
management theme in 2007 with the beginning of convergence of
several existing products onto the global reuters knowledge for
wealth management platform
operating costs were £315 million in 2006 up 7 driven primarily 
by trading cost increases partially offset by lower fast forward
restructuring charges trading costs were £305 million in 2006 up 
10 on an actual basis and 8 on an underlying basis in 2006 the
business saw significant investments under the core plus programme
in high value content and new functionality for reuters knowledge
with reuters knowledge now on a quarterly release cycle new
content can be released to customers more quickly the 2005
acquisition of ecowin also contributed profits in 2006 partially
offsetting the higher trading costs were lower fast forward
restructuring charges
60 operating and financial review continued reuters group plc annual report and form 20f 2006
61 company information and ofr
research  asset management generated a net operating loss of 
£12 million in 2006 compared to a loss of £35 million in 2005 despite
additional core plus investment costs in 2006 this improvement was
primarily driven by the improved revenue growth
in 2007 research  asset management is expected to sustain its
strong revenue growth and improve profitability initiatives such 
as the formation of a primary research group to create and sell
proprietary content are expected to deliver benefit over a longer 
time horizon and are being well received in early client testing
enterprise division
overview
reuters aggregates information to give a single view of the financial
markets and the events that move them our enterprise division
provides information and software that support business automation
within the capital markets for example automated trading and
regulatory compliance
our products include
• reuters datascope realtime datafeeds streams of machine
readable price data delivered over our networks at high speed for
use in customers’ information and trading services
• reuters datascope pricing and reference data which help banks and
financial organisations achieve regulatory compliance by delivering
accurate financial instrument prices and reference material for the
capital markets globally in 2006 we launched a new distribution
platform reuters datascope select to support back office and fund
valuation processes
• reuters market data system a resilient content distribution software
platform that enables banks to deliver high volume and low latency
data into a wide variety of financial systems
• trade and risk management systems to help banks manage their
trading position and monitor their exposure to trading risk in 2006
we acquired application networks inc whose coverage of credit
derivatives and structured financial products complements our
existing strengths in fx and treasury risk management and
• reuters messaging a secure online messaging service that connects
financial professionals within and across existing communities of
interest
several stock exchanges compete with our real time datafeed business
by providing lowlatency realtime feeds of their data direct to banks
and financial institutions in addition feedhandlers and application
programmable interface developers such as wombat infodyne and
activ financial compete with us in the market data delivery arena
our pricing and reference data offerings compete primarily with
bloomberg telekurs and idc competitors in the supply of risk
products and market data systems or related components include
algorithmics murex summit systems sungard data systems misys
gl trade and a large number of smaller firms
financial performance
enterprise division summary 
operating and trading results 2006 2005  actual underlying
year to 31 december £m £m change change
revenue 408 385 6 6
trading costs 323 291 11 10
restructuring charges 1 17
other operating income 
in trading costs 5 5
impairments and amortisation 
of business combination
intangibles 3 4
fair value movements 
in expenses 3 –
operating costs 335 317 6
other operating income 6 8
operating profit 79 76 3
operating margin 19 20
trading margin 21 24
 in 2006 reuters made changes to the allocation of revenue and trading costs between business
divisions to reflect changes in the management of certain products 2005 comparatives have
therefore been restated to decrease enterprise revenue by £8 million and trading costs by £7
million 2005 comparatives have also been restated to reallocate £1 million of amortisation on
intangible assets arising on the acquisition of telerate from enterprise to sales  trading in line
with the allocation of revenues from telerate products
reconciliations between the ifrs and nongaap measures are provided on pages 69–72
the enterprise division under the leadership of peter moss achieved
a strong return to revenue growth in 2006 revenue of £408 million was
up 6 both on an actual and underlying basis
our financial services customers are looking to grow revenues and cut
costs through increased levels of business automation the enterprise
division is well placed to help them achieve these goals and has made
significant progress during 2006
enterprise information area saw the best revenue growth within the
enterprise division on both an actual and an underlying basis revenues
grew 13 to £220 million financial services customers are consuming
more and more data as they seek to provide a competitive edge for
their customers and become increasingly sophisticated in the valuation
of financial instruments and funds and understanding of risk the
breadth depth and reliability of reuters enterprise information make 
it a market leader in these fields
trade and risk management also benefited from demand for business
automation and saw revenues grow 13 on an actual basis 12 on
an underlying basis to £92 million the kondor trade and risk
management desktop product was significantly upgraded in the
course of the year and the launch of kondor trade processing added
fronttoback office trade management capabilities to further the
automation of trading businesses application networks was acquired
and integrated during 2006 although its initial contribution to
revenues was small the sales pipeline for 2007 is strong
information management systems ims continued to see revenue
declines – by 11 on an actual basis 12 on an underlying basis – to
£96 million driven by the move to desktop based solutions at smaller
sites withdrawal from the hardware business and the fact that the
majority of customers have now migrated from legacy platforms onto
reuters market data system rmds by the end of 2006 ims had
seen the majority of the flowthrough effect of migrating customers
from legacy tibtriarch systems to the rmds as well as from exiting
other legacy business new core plus products such as the reuters
wireless delivery system and reuters tick capture engine started 
to generate revenue in 2006 and are expected to make a larger  reuters group plc annual report and form 20f 2006
contribution in 2007 widespread customer use of rmds as a platform
for making information available throughout an enterprise is of key
strategic importance to reuters
enterprise operating costs in 2006 were £335 million up 6 driven
primarily by trading cost increases partially offset by lower fast
forward restructuring charges trading costs in 2006 were £323 million
up 11 on an actual basis and 10 on an underlying basis during
2006 the enterprise division invested in a series of new initiatives
under core plus to broaden its suite of business automation solutions
for example reuters datafeed direct reuters datascope tick history
the reuters tick capture engine and reuters newsscope all support
evolving trends in automated trading
although core plus investment reduced 2006 trading profit trading
margin remained above 20 operating profit increased slightly in
2006 to £79 million helped by the reduction in fast forward
restructuring charges though the operating margin decreased to 19
in 2007 enterprise is targeting higher levels of revenue growth and
improved profitability
media division
overview
the media division creates packages and distributes news and
information services to the world’s newspapers television and cable
networks radio stations and websites as well as directly to consumers
through reutersbranded digital services across online mobile and
iptv platforms reuters media products provide comprehensive and
timely news and information as text video graphics and photos
reuters media targets media professionals and influential consumers
who need fast accurate and trusted news and information to keep
them informed reuters news and information reaches over 1 billion
people every day through our worldwide media partners and reuters
online sites reach a unique audience of 16 million individuals globally
each month
in june 2006 we relaunched reuters pictures our online photo
product and archive used by media outlets worldwide in september
2006 we launched the first virtual news bureau in second life an
online virtual world helping us to strengthen our online media brand
and profile we sold the majority of our 50 stake in our factiva joint
venture to dow jones our joint venture partner for £79 million in
december 2006
our main competitors in the supply of news to the media are
associated press agence france presse dow jones and bloomberg
news in the directtoconsumer market we compete with a variety of
local and global providers including the bbc’s websites and yahoo
finance
financial performance
media division summary operating 
and trading results 2006 2005 actual underlying
year to 31 december £m £m change change
revenue 170 153 11 10
trading costs 154 135 13 12
restructuring charges – 8
other operating income 
in trading costs 2 2
impairments and amortisation 
of business combination 
intangibles 1 1
fair value movements 
in expenses 1 –
operating costs 158 146 8
other operating income 3 4
operating profit 15 11 43
operating margin 9 7
trading margin 10 12
reconciliations between the ifrs and nongaap measures are provided on pages 69–72
the media division delivered strong growth in 2006 with revenues of
£170 million up 11 on an actual basis 10 on an underlying basis
the major drivers of revenue growth were new sales of tv
subscriptions and growth in online advertising chris ahearn
strengthened his team during the year by adding online editorial
marketing technology and advertising expertise
revenue from agency services grew 7 on actual basis 6 on an
underlying basis to £143 million driven principally by strong new sales
of tv subscriptions particularly in the middle east and central and
eastern europe and increased customer use of picture services as
publishers and broadcasters retrench and seek to control their direct
editorial costs new revenue opportunities for reuters news agency
have opened and continued to be pursued in addition the demand
for video for inclusion in the online properties of traditional newspaper
clients has fuelled demand for reuters television feeds
consumer media revenue grew 38 on an actual and 39 on an
underlying basis to £27 million driven principally by strong growth in
online advertising on the reuterscom sites
trading profit declined on an actual basis but remained stable on an
underlying basis with a strong performance from the agency business
offset by the investment under core plus to capitalise on the high growth
rates in interactive media operating profit increased in 2006 to £15
million helped by the reduction in fast forward restructuring charges
in 2007 the division is expected to maintain similar levels of growth 
at improved margins as it begins to realise scale advantages in the
newer businesses and benefits from the increased functionality of its
new web platform
supporting financial information
management of risks
details of the financial risk management objectives and policies of 
the company and the exposure of the company to financial risk are
provided in ‘internal control’ on page 41 and in the financial
statements within note 17 on page 99
62 operating and financial review continued reuters group plc annual report and form 20f 2006
63 company information and ofr
pending transactions and post balance sheet
events
there are no material pending transactions
details of post balance sheet events are given on page 127
treasury policies
reuters treasury function is a cost rather than profit centre all treasury
activity takes place within a formal control framework under policies
approved by the board as such all transactions which are undertaken
are designed to mitigate risk within the business or to secure funding
at no time do we undertake speculative transactions or transactions
without an underlying commercial rationale
the key objectives of the treasury function are to ensure sufficient
liquidity exists to meet funding needs and to manage the interest rate
and currency risks arising from the group’s operations and its sources
of finance
financing
we finance the business from a mixture of cash flows from operations
shortterm borrowings from banks commercial paper issuance backed
up as required by committed bank facilities and debt issuance in the
capital markets we manage our net debt position and interest costs
to support our continued access to the full range of debt capital
markets we expect to be able to finance our current business plans
from ongoing operations and our external facilities
net cash flows are applied to reduce debt placed in shortterm
deposits with financial institutions holding strong credit ratings or 
used to repurchase the company’s own shares as part of an announced
buyback programme designed to enhance shareholder returns
during 2006 £527 million was applied to market purchases of the
company’s own shares for information about the company’s share
repurchases see page 116 at 31 december 2006 the group had 
net debt of £333 million
reuters is rated by the three principal credit rating agencies as at 31
december 2006 our long and shortterm ratings were fitch af1
moody’s a3p2 and standard and poor’s aa2 following the
announcement on 1 march 2007 that reuters expects to increase 
the buyback during 2007 to £400–425 million which includes the 
£250 million remaining of the £1 billion buyback announced in july
2005 standard and poor’s and fitch ratings both revised downwards
the longterm rating from a to bbb and moody’s have put the rating
under review for a possible downgrade going forward we will actively
manage our capital structure to maintain an investment grade rating 
of bbbbaa1
we borrow in various currencies at both fixed and floating rates and
use derivative contracts to create the desired currency and interest rate
basis the conversion of net investments in foreign operations into the
group’s reporting currency of sterling for accounting purposes creates
translation exposure to mitigate this effect to the extent that the
group has core debt it will be held in currencies approximately
proportionate to the currency profile of the group’s net assets
in broad terms using the average net debt position a 1 increase in
global interest rates would have reduced profit before tax in the year by
approximately £2 million 2005 £2 million before the impact of hedging
multicurrency revolving credit facility
in october 2006 we entered into a committed multicurrency revolving
credit facility for £680 million this replaced an existing committed
syndicated credit facility of £480 million and a bilateral loan facility of
£24 million at 31 december 2006 we had available £623 million under
the facility following utilisation of £57 million in the form of a standby
letter of credit there were no cash drawings from the facility during
2006 the commitment expires and any final repayment is due in
october 2011 unless oneyear extension options are exercised in
october 2007 and october 2008 at the banks’ discretion in this
instance the latest expiry date would be 2013
the facility is on customary terms and conditions drawings under the
facility may be made in sterling euros or other currencies agreed at
the time and bear interest at libor plus a margin variable according
to the longterm credit rating of the company the facility cross
defaults upon default by reuters in payment or acceleration of any
other borrowings in excess of £20 million the facility contains no
financial covenants
euro commercial paper programme
a £15 billion euro commercial paper programme is available in
respect of which we had obligations of £122 million at 31 december
2006 the minimum outstanding during 2006 was nil and the maximum
was £319 million
the programme is on customary terms and conditions including a
condition that the company should not be in default on any other debt
or similar obligation issues are only made to the extent that funds can
be repaid from committed financing facilities or available group cash
the programme has no final maturity date contains no financial
covenants and there is no requirement to update the programme
documentation debt is issued at market rates agreed between the
issuer and the dealer
euro medium term note programme
we also have available a £1 billion medium term note programme
at 31 december 2006 we had outstanding obligations of £510 million
under the programme repayable at various dates up to november
2010 including a €500 million £337 million public bond issued in
november 2003 and maturing in november 2010 and a €250 million
£168 million floating rate note issued in november 2006 and
maturing in november 2008 the minimum outstanding during 2006
was £341 million and the maximum was £510 million
the programme is on customary terms and conditions the
programme has no final maturity date but the prospectus containing
financial information is updated each year debt is issued at market
rates agreed between the issuer and the dealer the programme
documentation contains no financial covenants and notes in issue have
no crossdefault provision
shortterm uncommitted facilities
in addition we have shortterm uncommitted bank borrowing facilities
denominated in various currencies the sterling equivalent of which
was approximately £117 million at 31 december 2006 £24 million of
the facilities were utilised in the form of bank overdrafts
contractual financial obligations
the following table summarises our principal contractual financial
obligations at 31 december 2006 certain of which are described in the
consolidated financial statements and notes we expect to be able to
fund such obligations from ongoing operations and external facilities reuters group plc annual report and form 20f 2006
contractual obligations
at 31 december 2006 payments due by period
less than 13 35 after 5
total 1 year years years years
£m £m £m £m £m
finance lease 
payables 4 22 – –
debt obligations 
including future 
interest payments 907 217 299 391 –
pension obligations  131 68 58 5 –
other provisions 
and liabilities  95 59 23 8 5
operating leases 652 88 149 115 300
purchase obligations 981 164 293 370 154
total contractual 
obligations 2770 598 824 889 459
 net pension obligations are recorded on the balance sheet at £131 million £145 million
pension obligations less £14 million pension funds in surplus as there is discretion under the
various schemes as to the amounts the group will contribute to settlement of the net pension
obligation the amounts provided are estimates
 other provisions and liabilities excluding net pension obligation on the balance sheet total £119
million of this £95 million are financial liabilities that require settlement in cash additionally the
balance sheet contains a deferred tax liability of £110 million no estimate has been provided for
these in the table above as they are not contractually obligated financial liabilities
foreign exchange
almost 90 of our revenue is denominated in nonsterling currencies
we also have significant costs denominated in foreign currencies with
a different mix from revenue in some cases product pricing is
denominated in a foreign currency which gives rise to embedded
derivatives for which movements in value are recognised in profit or
loss our profits are therefore exposed to currency fluctuations
in broad terms using the 2006 mix of profits a 5 cent weakening
strengthening in either the us dollar or the euro would decrease
increase 2007 trading profits by approximately £10 million
exchange rate movements in 2006 had a £3 million net impact on
operating profit
operating operating
revenue cost profit
currency impact £m £m £m
impact of
weaker euro 3 1 2
stable dollar 4 3 1
weaker yen 9 4 5
other currencies 1 1 –
exchange rate movements 7 1 6
change in currency mix 10 7 3
total currency movements 3 6 3
no unremitted profits are hedged with foreign exchange contracts 
as the company judges it inappropriate to hedge noncash flow
translation exposure with cash based instruments
forward foreign exchange contracts currency options and foreign
exchange swaps are used to manage where appropriate the effects of
transaction exposure and certain intercompany transactions which impact
profits transaction exposure occurs when as a result of trading activities
an entity receives cash in a currency different to its functional currency
critical accounting policies
our accounting policies comply with ifrs as adopted by the eu
these policies and associated estimation techniques and judgements
have been reviewed by management and discussed with the audit
committee who have confirmed they are the most appropriate for 
the preparation of the 2006 financial statements
accounting policies involving management judgement
in preparing the financial statements management has made its best
estimates and judgements of certain amounts included in the financial
statements the areas discussed below are considered to be the most
critical the accounting policies underpinning the financial statements
are outlined on pages 78–82 which also include reference to the areas
of judgement within the accounting policies
the impairment of property plant and equipment noncurrent assets
held for sale and intangible assets including goodwill
under ifrs impairment is measured by comparing the carrying value
of an asset or cash generating unit to its recoverable amount
recoverable amount is defined as the higher of its fair value less costs
to sell and its ‘value in use’ these comparisons require subjective
judgements and estimates to be made by management with regard to
projected future cash flows of incomegenerating units or the amounts
that could be obtained from the sale of investments
note 13 of the financial statements on pages 93–94 outlines the key
assumptions management has determined that no impairments are
required for 2006 2005 nil 2004 £18 million
intangible assets
expenditure related to the development of new products or
capabilities that is incurred between establishing technical feasibility
and the asset becoming ready for use is capitalised when it meets 
the criteria outlined in ias 38 ‘intangible assets’ such assets are then
systematically amortised over their useful economic life normally
between three and five years additionally the costs of acquiring
software licences and costs incurred in bringing software into use are
capitalised and amortised over the expected life of the licence
normally five years
there is judgement involved in determining an appropriate framework
to consider which expenditure requires capitalisation and which should
be expensed amounts capitalised in 2006 for development and
software total £114 million 2005 £40 million 2004 £26 million
defined benefit pension plans
we operate a number of defined benefit plans some of which also
include postretirement medical benefits for material schemes their
valuation is determined by independent actuaries these valuations
and the income statement charge require assumptions to be made 
in respect of future income levels expected mortality inflation the
longterm rate of return on the scheme assets rate of increase in
social security costs and medical cost trends along with the discount
rate used to convert the future cash flows into a present value these
assumptions are reviewed annually
the amounts recorded in the annual charge service cost and interest
cost offset by the expected return on assets are sensitive to changes
in these assumptions actuarial gains and losses are recognised fully in
the statement of recognised income and expense
note 25 on pages 111–114 provides further details of the annual
charges £30 million and the net outstanding pension obligation
£131 million quantification of the underlying assumptions and an
estimate of the impact on the financial statements to changes in 
the most critical assumptions
64 operating and financial review continued reuters group plc annual report and form 20f 2006
sharebased payments
ifrs 2 ‘sharebased payment’ which we have elected to apply only 
to share awards granted after 7 november 2002 which had not vested
by 1 january 2005 recognises that options represent an element of
remuneration for services provided by employees and should be
reflected as a charge against profit the charge which is spread over
the vesting period of the award is the fair value of the award at grant
date and is calculated using an option pricing model
a combination of black scholes and monte carlo simulation models
has been used to calculate the fair values of awards the use of these
models requires management to make a number of assumptions
including expected life of the options historic volatility of reuters
shares and expected dividends for the life of the option management
has considered historical data and made use of best practices in
making these assumptions
the total cost of share schemes in 2006 was £30 million 2005
£30 million 2004 £22 million for additional information refer to 
note 33 on page 120
provisions
the recognition of provisions both in terms of timing and quantum
requires the exercise of judgement based on the relevant
circumstances which can be subject to change over time
the largest provisions relate to restructuring programmes which cover
primarily leasehold properties and severance for severance
provisions the provision is only recognised where employees have 
a valid expectation or have already been told of their redundancy
a number of leasehold properties have been identified as surplus to
requirements although efforts are being made to sublet this vacant
space management recognises that this may not be possible
immediately estimates have been made to cover the cost of vacant
possession together with any shortfall arising from subleased rental
income being lower than lease costs being borne by reuters 
a judgement has also been made in respect of the discount factor
based on a riskfree rate which is applied to the rent shortfalls
additionally we are subject to certain legal claims and actions see
note 35 on page 124 provision for specific claims or actions are only
made when the outcome is considered ‘probable’ that there will be 
a future outflow of funds andor providing for any associated legal
costs the level of any provision is inevitably an area of management
judgement given that the outcome of litigation is difficult to predict
other provisions are held where the recoverability of amounts is uncertain
where the actual outcome may differ from the resulting estimates
segment reporting
our primary segmental reporting is by business division we operate
through four business divisions sales  trading research  asset
management enterprise and media in order to report segmental
results it is necessary to determine a methodology to allocate
revenues operating costs other operating income assets and
liabilities to those segments
each division is responsible for specific products’ revenues except 
for the reuters 20003000 range of products and reuters 3000 xtra
revenues for these shared products are attributed to either the sales
 trading division or the research  asset management division by
reference to the nature of the customer taking the product this is
determined on a clientbyclient basis
where operating costs relate to a specific division they are mapped
directly to that division where operating costs are shared activity
based costing abc techniques are used to split these costs between
divisions the reuters abc tool known as profitability insight
allocates shared costs to business activities which in turn are
attributed to products and therefore divisions using different drivers
of cost these cost drivers eg the number of helpdesk calls received
or the number of installed accesses are derived from a variety of
underlying source systems judgement has been applied in
determining these cost drivers and the resulting allocation of costs
other operating income is allocated to divisions using a similar
methodology to operating costs
assets and liabilities are attributed to business divisions using
methodologies consistent with those applied to revenue and costs
assets and liabilities are segmented to the extent that they relate to
the operating activities of the divisions assets and liabilities related 
to financing activities including cash balances are not segmented
divisional results could alter with the application of other allocation
approaches and as improvements to the profitability insight model 
are made in 2006 reuters made changes to the allocation of revenue
and costs between business divisions to reflect changes in the
management of certain products 2005 and 2004 comparatives have
therefore been restated within relevant business divisions
taxation
we are subject to tax in numerous jurisdictions significant judgement
is required in determining the worldwide provision for tax there are
many transactions and calculations for which the ultimate tax
determination is uncertain during the ordinary course of business we
recognise liabilities for anticipated tax audit issues based on estimates
of whether additional taxes will be due where the final tax outcome
of these matters is different from the amounts that were originally
recorded such differences will affect the tax provisions in the period 
in which such determination is made
under ifrs and us accounting standards in assessing which deferred
tax assets to record on the balance sheet management has made
subjective judgements over the projected future profitability of certain
legal entities
us gaap
reconciliations of net income and shareholders’ equity under ifrs and
us gaap are set out on page 132 a discussion of the relevant us
accounting policies which differ materially from ifrs is given on pages
129–131 in the ‘summary of differences between ifrs as adopted by
the eu and us gaap’ details of recent us gaap accounting
pronouncements are given on page 133
critical accounting policies as stated above are consistent with those
under us gaap 
offbalance sheet arrangements
the group does not have any offbalance sheet arrangements as
defined by the sec that have or are reasonably likely to have a
current or future effect on the group’s financial position or results 
of operations material to investors
risk factors
forwardlooking statements
this document contains certain forwardlooking statements within the
meaning of the united states private securities litigation reform act 
of 1995 with respect to the company’s financial condition results of
65 company information and ofr reuters group plc annual report and form 20f 2006
operations and business and our management’s strategy plans and
objectives in particular all statements that express forecasts
expectations and projections with respect to certain matters including
trends in results of operations margins growth rates overall financial
market trends anticipated cost savings and synergies and the
successful completion of transformation programmes strategy plans
acquisitions and disposals are all forwardlooking statements these
statements involve risk and uncertainty because they relate to events
and depend on circumstances that may occur in the future there are 
a number of factors that could cause actual results and developments
to differ materially from those expressed or implied by these forward
looking statements these factors include but are not limited to the
risk factors discussed below any forwardlooking statements made by
the company or on its behalf speak only as of the date they are made
we do not undertake to update any forwardlooking statements
we may not be able to realise the anticipated benefits of our 
core plus growth and transformation strategy
the core plus growth and transformation strategy includes investing 
in new revenue initiatives and transformation initiatives including
content and development transformation common platform customer
administration and data centre rationalisation there can be no
assurance of achievement of these objectives or of the exact timing 
or extent to which the anticipated benefits of this programme will 
be realised
unfavourable conditions in financial markets may have a significant
adverse effect on our business
our business is dependent upon the health of the financial markets
and the participants in those markets our trading products are
dependent on the level of activity in those markets if these conditions
were to worsen or in the event of significant trading market disruptions
or suspensions there could be adverse effects on our business 
in addition our business could be adversely affected by further
consolidation among clients and competitors
currency fluctuations and interest rate fluctuations may have 
a significant impact on our reported revenue and earnings
the group reports results in pounds sterling but receives revenue 
and incurs expenses in more than 70 currencies and is thereby
exposed to the impact of fluctuations in currency rates currency
movements resulted in a small impact on our operating profit in 2006
a strengthening of sterling from current levels especially in relation 
to other currencies in which we derive significant revenues or hold
significant assets could adversely affect results in future periods to
the extent that these currency exposures are not hedged exchange
rate movements may cause fluctuations in the group’s consolidated
financial statements in addition an increase in interest rates from
current levels could adversely affect our results in future periods
we may experience difficulties or delays in developing or responding
to new customer demands or launching new products
our business environment is characterised by rapid technological
change changing and increasingly sophisticated customer demands
and evolving industry standards if the company is unable to anticipate
and respond to the demand for new services products and
technologies on a timely and costeffective basis and to respond and
adapt to technological advancements and changing standards its
business may be adversely affected in addition the company may
delay or halt the launch of new products and services its existing
products and services may cease to be attractive to customers and
new products and services that we may develop and introduce may
not achieve market acceptance in the event any of the foregoing
occurs our financial results could be adversely affected
we are dependent on third parties for the provision of certain
network and other services
we have outsourced the daytoday operation of most of our networks
to btradianz which also provides network services to other
companies in connection with the 2001 acquisition of certain
businesses and assets of bridge information services bridge we
entered into a network services agreement with savvis which was the
primary provider of network services to bridge in addition savvis had
a network services agreement with telerate which we acquired with
our acquisition of telerate failure or inability of any third party that
provides significant services to us such as btradianz or savvis to
perform its obligations in a timely manner could adversely affect our
financial results
our business may be adversely affected if our networks or systems
experience any significant failures or interruptions or cannot
accommodate increased traffic
our business is dependent on the ability to rapidly handle substantial
quantities of data and transactions on computerbased networks and
systems and those of btradianz savvis and others any significant
failure or interruption of such systems including terrorist activities
could have a material adverse effect on our business and results of our
operations the continuing increase in the update rates of market data
may impact product and network performance from time to time
factors that have significantly increased the market data update rates
include the emergence of proprietary data feeds from other markets
high market volatility decimalisation reductions in trade sizes resulting
in more transactions new derivative instruments increased
automaticallygenerated algorithmic and program trading market
fragmentation resulting in an increased number of trading venues and
multiple listings of options and other securities changes in legislation
and regulation pertaining to market structure and dissemination of
market information including the european implementation of mifid
us implementation of regulation nms and a penny pricing pilot for
quoting in options may also increase update rates while we have
implemented a number of capacity management initiatives there can
be no assurance that the company and its network providers will be
able to accommodate accelerated growth of peak traffic volumes or
avoid other failures or interruptions
we are exposed to a decline in the valuation of companies in which
we have invested
we have made strategic investments in a number of companies and
intend to continue to do so if and when favourable opportunities
arise the value of our interests in these companies is dependent on
among other things the performance of these companies generally
whether such performance meets investors’ expectations and external
market and economic conditions we have limited ability to influence
the management andor performance of some of these companies
significant competition or structural changes in the financial
information and trading industries could adversely affect our business
we face significant competition in the financial information and
trading industries the availability of public internet technology
reduces barriers to entry and increases the availability of trading
venues resulting in more commoditised data and less valuable data
less effective control over intellectual property and reduced revenues
many of the financial markets which we serve are undergoing or may
undergo structural changes as a result of competition regulation or
otherwise if we are unable to cope effectively with increased
competitive pressure or structural changes arising from the above or
any other factors our financial results could be adversely affected
66 operating and financial review continued reuters group plc annual report and form 20f 2006
67 company information and ofr
our business may be adversely affected by changes in legislation 
and regulation
aspects of our business such as the dissemination of market
information in certain jurisdictions are subject to regulatory
requirements changes to requirements regarding the data that must
be displayed or how it must be displayed may affect us adversely
we may be exposed to adverse governmental action in countries
where we conduct reporting activities
as the world’s largest news and information company we may suffer
discriminatory tariffs censorship or other forms of adverse government
intervention due to the nature of our editorial and other reporting
activities
we may not be able to realise the anticipated benefits of existing 
or future acquisitions joint ventures investments or disposals
to achieve our strategic objectives we have acquired invested in
andor disposed of and in the future may seek to acquire invest in
andor dispose of various companies and businesses no assurance
can be given that we will realise when anticipated or at all the
benefits we expect as a result of any acquisition investment or
disposal achieving the benefits of acquisitions will depend on many
factors including the successful and timely integration and in some
cases the consolidation of products technology operations and
administrative functions of companies that have previously operated
separately considering the technical and complex nature of our
products and services these integration efforts may be difficult and
time consuming achieving the benefits of joint ventures and
investments will depend on many factors including the success of the
relevant joint venture or company in its particular business and the
degree to which reuters is able to realise strategic economic or other
benefits from its relationship with such joint venture or company
achieving benefits of disposals will likewise depend on many factors
including realisation of appropriate value successful separation of the
businesses and operations and management of related costs and
achievement of any benefits sought in connection with the transaction
we operate in an increasingly litigious environment
our business involves a number of areas of technology including
certain business methods this combined with the recent proliferation
of socalled ‘business method patents’ issuing from the us patent
office and the increasingly litigious environment that surrounds
patents in general increases the possibility that we could be sued for
patent infringement if such an infringement suit were successful it is
possible that the infringing product would be enjoined by court order
and removed from the market in addition to the legal fees that would
be incurred defending such a claim any settlement of such a claim
could also involve a significant sum
definition of key financial performance measures
reuters measures its financial performance by reference to revenue
and profit operating margin eps cash flow and net funds to
supplement ifrs measures reuters undertakes further analysis to
break these measures out into their component parts which results in
the creation of certain measures which differ from the ifrs headline
indicators ‘nongaap measures’ the rationale for this analysis is
outlined below and reconciliations of the nongaap measures to ifrs
measures are included within the ofr these measures are used by
management to assess the performance of the business and should 
be seen as complementary to rather than replacements for reported
ifrs results
underlying and constant currency results
periodonperiod change in reuters is measured in overall terms 
ie actual reported results and sometimes in underlying or constant
currency terms as well constant currency change is calculated by
excluding the impact of currency fluctuations underlying change is
calculated by excluding the impact of currency fluctuations as well as
the results of acquisitions and disposals this enables comparison of
reuters operating results on a likeforlike basis between periods
• constant currency results are calculated excluding the impact of
currency fluctuations variations in currency exchange rates impact
the results because reuters generates revenues and incurs costs in
currencies other than its reporting currency yearonyear currency
exchange rate movements will influence reported numbers to a
greater or lesser extent and therefore they are discussed separately
from underlying results to make clear their impact on the overall
growth or decline in operations constant currency results are
calculated by restating the prior periods’ results using the current
period’s exchange rates this also reflects the variables over which
management has control as business units do not actively manage
currency exposure and business division operating performance is
managed against targets set on a constant currency basis currency
exposure is described in ‘treasury policies’ on pages 63–64
• underlying results are calculated excluding the impact of currency
fluctuations as well as the results of entities acquired or disposed of
during the current or prior periods from the results of each period
under review underlying results reflect the operating results of the
ongoing elements of each business division and measure the
performance of management against variables over which they have
control without the yearonyear impact of a step change in revenue
and costs that can result from currency movements and acquisition
or disposal activity
exclusion of restructuring charges
reuters results are reviewed before and after the costs of reuters
business transformation plans which included the former fast forward
programme and acquisition integration charges
under the fast forward programme reuters incurred restructuring
charges relating primarily to headcount reduction and rationalisation
of the company’s property portfolio fast forward was a three year
programme implemented to accelerate and expand on reuters five
year business transformation plan which was launched in 2001 the
programme completed in 2005 as originally envisaged
the fast forward programme was centrally managed and its
performance against targets was evaluated separately from the
ongoing reuters business fast forward restructuring charges are
therefore excluded from certain profit cash flow and margin measures
acquisition integration costs are oneoff charges associated with
transaction activity which do not recur as described above the
charges in respect of acquisition activity are excluded to enable better
likeforlike comparison between periods
because of their timelimited and defined nature reuters believes that
presenting these measures both including and excluding restructuring
charges and acquisition integration costs gives investors a more
detailed insight into the performance of management and the
business in addition reuters management uses both measures 
to assess the performance of management and the business reuters group plc annual report and form 20f 2006
68
exclusion of amortisation and impairment of intangibles
acquired in a business combination investment income
profitlosses from disposals and fair value movements
for certain cost profit cash flow margin and eps measures reuters
analyses its results both before and after the impact of restructuring
charges amortisation and impairments of intangibles acquired in a
business combination investment income profits and losses from
disposals and fair value movements the adjusted measures are
referred to as ‘trading profit’ ‘trading costs’ ‘trading margin’ and
‘trading cash flow’ the rationale for isolating restructuring charges 
is explained above
amortisation and impairment of intangibles acquired in a business
combination investment income and profitlosses from disposals
reuters isolates the impact of income and charges in respect of its
investments income and charges from investments relate to impairments
of goodwill subsidiaries associates and joint ventures impairments and
amortisation of other intangibles acquired in a business combination
income from investments and pretax profits and losses on disposal of
subsidiaries joint ventures associates and other investments
such charges and income may arise from corporate acquisition and
disposal activity rather than the ongoing operations of the business
divisions with a reasonable allocation being determined for segmental
reporting these are analysed and reviewed separately from ongoing
operations as this is consistent with the manner in which reuters sets
internal targets evaluates its business units and issues guidance to the
investor community
amortisation and impairment charges in respect of software and
development intangibles are included within operating and trading
costs
fair value movements
reuters also isolates the impact of movements in the fair value of
financial assets held at fair value through profit or loss embedded
derivatives and derivatives used for hedging purposes where those
changes are reflected in the income statement
financial assets held at fair value through profit or loss in 2005 included
reuters investment in savvis convertible shares this investment was
sold as part of the acquisition consideration for telerate fair value
movements for this investment were analysed separately from the
ongoing operations of the business units during 2005
embedded derivatives are foreign exchange contracts implicitly
contained in some of reuters revenue and purchase commitments
changes in the fair value of embedded derivatives arise as a result 
of movements in foreign currency forward rates the unpredictable
nature of forward rates the uncertainty over whether the gains or
losses they anticipate will actually arise and the volatility they bring 
to the income statement lead reuters to consider that it is appropriate
to analyse their effects separately from the ongoing operations of the
business this enables reuters to undertake more meaningful period
onperiod comparisons of its results as well as to isolate and
understand better the effect of future currency movements on revenue
and purchase commitments this separate analysis is also consistent
with the manner in which reuters sets its internal targets evaluates its
business divisions and issues guidance to the investor community
the impact of fair value movements on derivatives relating to treasury
hedging activity is also excluded unless there is an equivalent offset in
operating results all derivatives undertaken are used to manage the
group’s exposure but some may not qualify for hedge accounting and
in these situations the reported impact of the underlying item and the
derivative may not offset the impact of treasury derivatives is mainly
due to currency or interest rate movements and as for the other items
noted above business division operating performance is managed
against targets which exclude these factors
tax and adjusted eps
to ensure consistency the nongaap eps measure also eliminates the
earnings impact of taxation charges and credits related to excluded
items
adjusted eps is defined as basic eps from continuing operations
before impairments and amortisation of intangibles acquired via
business combinations fair value movements disposal profitslosses
and related tax effects
dividend policy
presenting earnings before the impact of restructuring charges
amortisation and impairment of intangibles acquired in a business
combination investment income disposals and fair value movements
also helps investors to measure performance in relation to reuters
dividend policy in 2001 the group defined the longterm goal of its
dividend policy to be a dividend cover of at least two times based on
reuters uk gaap earnings before amortisation of goodwill and other
intangibles impairments and disposals reuters dividend policy
remains unaltered with the adoption of ifrs the equivalent earnings
measure is reuters earnings after interest and taxation before
amortisation and impairments of intangibles acquired in a business
combination fair value movements and profitslosses on disposals
free cash flow
reuters free cash flow is used as a performance measure to assess
reuters ability to pay its dividend from cash flow free cash flow is
intended to measure all reuters cash movements other than those
which are either discretionary in nature or unrelated to ongoing
recurring operating activities such as special contributions to fund
defined benefit pension deficits acquisitions and disposals and
dividends paid out by reuters whilst reuters believes that free cash
flow is an important performance measure in respect of its cash flows
it is not used in isolation but rather in conjunction with other cash flow
measures as presented in the financial statements
net fundsdebt
net fundsdebt represents cash cash equivalents and shortterm
deposits net of bank overdrafts and borrowings this measure
aggregates certain components of financial assets and liabilities and is
used in conjunction with total financial assets and liabilities to manage
reuters overall financing position
operating and financial review continued reuters group plc annual report and form 20f 2006
69 company information and ofr
reconciliations of nongaap measures to ifrs
reconciliation of operating profit to trading profit and margin measures
2006 2006 2005 2005 2004 2004
year to 31 december £m  £m  £m 
operating profitmargin from continuing operations 256 10 207 9 194 8
excluding
restructuring charges 13 – 112 4 120 5
impairments and amortisation of business combination intangibles 24 1 22 1 16 1
investment income –– 1 –––
profit on disposal of subsidiaries 4 – 4 – 4 –
fair value movements 19 1 2 – – –
trading profitmargin 308 12 334 14 326 14
reconciliation of profit before taxation from continuing operations to adjusted profit before tax
2006 2006 2005 2005 2004 2004
year to 31 december £m  £m  £m 
profit before taxmargin from continuing operations 313 12 238 10 396 17
excluding
impairments and amortisation of business combination intangibles 24 1 22 1 16 1
investment income –– 1 – – –
profit on disposal of subsidiaries associates and joint ventures 80 3 42 2 207 9
fair value movements 19 1 2 – – –
profit before taxmargin before impairments and amortisation of 
business combination intangibles investment income profit 
on disposals and fair value movements adjusted profit before tax 276 11 215 9 205 9
reconciliation of basic eps to adjusted eps
2006 2006 2005 2005 2004 2004
year to 31 december £m eps pence £m eps pence £m eps pence
profitbasic eps from continuing operations 293 226 229 163 356 254
excluding
impairments and amortisation of business combination intangibles 24 18 22 16 16 11
investment income –– 1 01 – –
profit on disposal of subsidiaries associates and joint ventures 80 63 42 29 207 147
fair value movements 19 15 2 02 – –
adjustments to tax charge for tax effect of excluded items 34 25 13 09 – –
profitbasic eps from continuing operations before 
impairments and amortisation of business combination 
intangibles investment income profit on disposals fair value 
movements and related taxation effects 222 171 193 138 165 118
reconciliation of actual percentage change to underlying change – revenue by division by type
impact of
underlying impact of acquisitions actual
 change versus year ended 31 december 2005 change currency  disposals change
recurring 2 1 1 4
usage 23 1 – 22
outright 13 5 – 18
sales  trading 3 1 1 5
recurring 12 – 3 15
usage 27 1 – 26
outright 37 2 – 39
research  asset management 12 – 3 15
recurring 6–– 6
outright 7 2 1 6 
enterprise 6 1 1 6
recurring 7 1 – 6
usage 29 – 7 36
media 10 – 1 11
recurring 4 – 2 6
usage 24 – 2 26
outright 4 2 1 3
total revenue 5 –27 reuters group plc annual report and form 20f 2006
70
reconciliation of actual percentage change to underlying change – revenue by type
impact of
underlying impact of acquisitions actual
 change versus year ended 31 december 2004 change currency  disposals change
recurring 1 –34
outright 23 1 – 22
usage 12 – 1 13
total revenue – – 3 3
reconciliation of actual percentage change to underlying change – revenue by division by product family
impact of
underlying impact of acquisitions actual
 change versus year ended 31 december 2005 change currency  disposals change
reuters xtra  7 2 1 10
reuters trader 12 1 4 9
recoveries 7 –18
sales  trading 3 1 1 5
reuters xtra 26 1 – 25
reuters trader 7 3 – 4
reuters knowledge 20 1 14 33
investments banking investment management  corporates 22 1 6 27
reuters wealth manager 1 –12
research  asset management 12 – 3 15
enterprise information 13 – – 13
information management systems 12 – 1 11
trade and risk management 12 1 2 13
enterprise 6 1 1 6
agency services 6 1 2 7
consumer media 39 1 – 38
media 10 – 1 11
total revenue 5 –27
 3000 xtra revenue in sales  trading grew 8 on an underlying basis currency and acquisition impacts were 2 for each resulting in an actual change of 12
reconciliation of divisionai operating costs to trading costs
2006
sales  trading ram enterprise media group
year to 31 december £m £m £m £m £m
operating costs 1543 315 335 158 2351
restructuring charges 12 – 1 – 13
impairments and amortisation of business combination intangibles 17 3 3 1 24
fair value movements in expenses 18 3 3 1 25
other operating income 20 4 5 2 31
trading costs 1476 305 323 154 2258
2005 restated 
sales  trading ram enterprise media group
year to 31 december £m £m £m £m £m
operating costs 1495 293 317 146 2251
restructuring charges 76 11 17 8 112
impairments and amortisation of business combination intangibles 14 3 4 1 22
fair value movements in expenses 16 – – – 16
other operating income 16 3 5 2 26
trading costs 1373 276 291 135 2075
operating and financial review continued reconciliation of divisionai operating costs to trading costs continued
2004 restated 
sales  trading ram enterprise media group
year to 31 december £m £m £m £m £m
operating costs 1396 289 360 142 2187
restructuring charges 63 18 27 12 120
impairments and amortisation of business combination intangibles 10 3 3 – 16
other income 23 5 7 3 38
trading costs 1300 263 323 127 2013
 in 2006 reuters made changes to the allocation of revenue and operating costs between business divisions to reflect changes in the management of certain products prior year comparatives 
have therefore been restated to increase sales  trading revenue by £18 million 2004 £11 million and decrease operating costs by £19 million in 2005 and £11 million in 2004 research  asset
management revenues decreased by £10 million 2004 £3 million and operating costs increased by £12 million in 2005 and £6 million in 2004 enterprise revenue decreased by £8 million 2004 
£8 million and operating costs increased by £7 million in 2005 and £5 million in 2004 2005 comparatives have been restated to reallocate £1 million of amortisation on intangible assets arising on 
the acquisition of telerate from enterprise to sales  trading inline with the allocation of revenues from telerate products there is no change to the overall group results
reconciliation of divisional operating profit to trading profit
2006
sales  trading ram enterprise media group
year to 31 december £m £m £m £m £m
operating profitloss 174 12 79 15 256
restructuring charges 12 – 1 – 13
impairments and amortisation of business combination intangibles 17 3 3 1 24
profitloss on disposal of subsidiaries 3 – – 1 4
fair value movements 14 2 2 1 19
trading profitloss 214 7 85 16 308
2005 restated 
sales  trading ram enterprise media group
year to 31 december £m £m £m £m £m
operating profitloss 155 35 76 11 207
restructuring charges 76 11 17 8 112
impairments and amortisation of business combination intangibles 14341 22
investment income 1 – – – 1
profitloss on disposal of subsidiaries 7 5 1 1 4
fair value movements 3 2 2 1 2
trading profitloss 240 18 94 18 334
2004 restated 
sales  trading ram enterprise media group
year to 31 december £m £m £m £m £m
operating profitloss 175 13 28 4 194
restructuring charges 63 18 27 12 120
impairments and amortisation of business combination intangibles 10 3 3 – 16
profitloss on disposal of subsidiaries 5 12 2 1 4
trading profitloss 253 4 60 17 326
 in 2006 reuters made changes to the allocation of revenue and operating costs between business divisions to reflect changes in the management of certain products prior year comparatives 
have therefore been restated to increase sales  trading revenue by £18 million 2004 £11 million and decrease operating costs by £19 million in 2005 and £11 million in 2004 research  asset
management revenues decreased by £10 million 2004 £3 million and operating costs increased by £12 million in 2005 and £6 million in 2004 enterprise revenue decreased by £8 million 2004 
£8 million and operating costs increased by £7 million in 2005 and £5 million in 2004 2005 comparatives have been restated to reallocate £1 million of amortisation on intangible assets arising on 
the acquisition of telerate from enterprise to sales  trading inline with the allocation of revenues from telerate products there is no change to the overall group results
reuters group plc annual report and form 20f 2006
71 company information and ofr reuters group plc annual report and form 20f 2006
72
reconciliation of cash flows from operating activities to free cash flow and trading cash flow
2006 2005 2004
continuing discontinued reuters continuing discontinued reuters continuing discontinued reuters
operations operations group operations operations group operations operations group
year to 31 december £m £m £m £m £m £m £m £m £m
cash flows from operating activities 311 – 311 268 3 271 307 27 280
interest received 42 – 42 42 13 55 10 9 19
interest paid 61 – 61 49 – 49 29 1 30
tax paid 34 – 34 11 13 24 34 9 43
net cash flow from operating activities 258 – 258 250 3 253 254 28 226
purchases of property plant and equipment 122 – 122 138 7 145 90 19 109
proceeds from sale of property plant and equipment 5– 5 3 – 3491766
purchases of intangible assets 106 – 106 40 – 40 27 – 27
interim funding payment from telerate ––– 18 – 18 18 – 18
dividends received 3– 3 5 – 5415
special contributions to pension schemes 187 – 187 ––––––
repayment of funds tofrom btc ––– 26 26 – – – –
free cash flow 225 – 225 88 30 58 208 29 179
interest received 42 – 42 42 13 55 10 9 19
interest paid 61 – 61 49 –4929 1 30
tax paid 34 – 34 11 13 24 34 9 43
restructuring 52 – 52 147 – 147 100 8 108
other 13 – 13 3 4 1 14 3 17
trading cash flow 343 – 343 256 34 222 347 23 324
trading cash conversion  111 77 106
 trading cash conversion  trading cash flowtrading profit
components of net debtnet funds
2006 2005 2004
as at 31 december £m £m £m
cash and cash equivalents 129 662 578
bank overdrafts 24 25 17
105 637 561
shortterm deposits 198 1 258
borrowings excluding bank overdrafts 636 385 493
net debtfunds 333 253 326
operating and financial review continued 73
reuters group plc annual report and form 20f 2006
united kingdom audit opinion
independent auditors’ report to the members
of reuters group plc
we have audited the group financial statements of reuters group
plc for the year ended 31 december 2006 which comprise the
consolidated income statement the consolidated balance sheet the
consolidated cash flow statement the consolidated statement of
recognised income and expense and the related notes these group
financial statements have been prepared under the accounting
policies set out therein
we have reported separately on the parent company financial
statements of reuters group plc for the year ended 31 december
2006 and on the information in the directors’ remuneration report
that is described as having been audited
respective responsibilities of directors and auditors
the directors’ responsibilities for preparing the annual report and 
the group financial statements in accordance with applicable law 
and international financial reporting standards ifrss as adopted 
by the european union are set out in the statement of directors’
responsibilities
our responsibility is to audit the group financial statements in
accordance with relevant legal and regulatory requirements and
international standards on auditing uk and ireland this report
including the opinion has been prepared for and only for the
company’s members as a body in accordance with section 235 of the
companies act 1985 and for no other purpose we do not in giving
this opinion accept or assume responsibility for any other purpose or to
any other person to whom this report is shown or into whose hands it
may come save where expressly agreed by our prior consent in writing
we report to you our opinion as to whether the group financial
statements give a true and fair view and whether the group financial
statements have been properly prepared in accordance with the
companies act 1985 and article 4 of the ias regulation we also
report to you whether in our opinion the information given in the
directors’ report is consistent with the group financial statements
the directors’ report includes that specific information presented 
in the information for shareholders that is cross referred from the
company information and operating and financial review section 
of the directors’ report
in addition we report to you if in our opinion we have not received 
all the information and explanations we require for our audit or if
information specified by law regarding director’s remuneration and
other transactions is not disclosed
we review whether the corporate governance statement reflects the
company’s compliance with the nine provisions of the combined
code 2003 specified for our review by the listing rules of the
financial services authority and we report if it does not we are not
required to consider whether the board’s statements on internal
control cover all risks and controls or form an opinion on the
effectiveness of the group’s corporate governance procedures or 
its risk and control procedures
we read other information contained in the annual report and
consider whether it is consistent with the audited group financial
statements the other information comprises only the directors’ report
which comprises the business review explaining reuters the ceo’s
review information about strategy performance markets resources
and challenges the chairman’s statement the speed of change
corporate governance matters interview with the chairman note 
to the board information about the board directors and senior
managers the unaudited part of the remuneration report the
statement of directors’ responsibilities and compliance the company
information operating and financial review and selected financial
highlights and the other shareholder information we consider the
implications for our report if we become aware of any apparent
misstatements or material inconsistencies with the group financial
statements our responsibilities do not extend to any other
information
basis of audit opinion
we conducted our audit in accordance with international standards on
auditing uk and ireland issued by the auditing practices board an
audit includes examination on a test basis of evidence relevant to the
amounts and disclosures in the group financial statements it also
includes an assessment of the significant estimates and judgments made
by the directors in the preparation of the group financial statements
and of whether the accounting policies are appropriate to the group’s
circumstances consistently applied and adequately disclosed
we planned and performed our audit so as to obtain all the
information and explanations which we considered necessary in order
to provide us with sufficient evidence to give reasonable assurance
that the group financial statements are free from material
misstatement whether caused by fraud or other irregularity or error 
in forming our opinion we also evaluated the overall adequacy of the
presentation of information in the group financial statements
opinion
in our opinion
• the group financial statements give a true and fair view in
accordance with ifrss as adopted by the european union of the
state of the group’s affairs as at 31 december 2006 and of its profit
and cash flows for the year then ended
• the group financial statements have been properly prepared in
accordance with the companies act 1985 and article 4 of the ias
regulation and
• the information given in the directors’ report is consistent with 
the group financial statements
pricewaterhousecoopers llp
chartered accountants and registered auditors
london
15 march 2007
the united kingdom opinion set out above is included for the purposes of reuters annual report
and financial statements only and does not form part of reuters form 20f for 2006 74
reuters group plc annual report and form 20f 2006
report of independent registered public
accounting firm to the members of reuters
group plc
we have completed an integrated audit of reuters group plc
31 december 2006 consolidated financial statements and of its
internal control over financial reporting as of 31 december 2006 and
an audit of its 31 december 2005 and 31 december 2004 consolidated
financial statements in accordance with the standards of the public
company accounting oversight board united states our opinions
based on our audits are presented below
consolidated financial statements
in our opinion the accompanying consolidated income statement and
the related consolidated balance sheet consolidated statement of
cash flows and consolidated statement of recognised income and
expense present fairly in all material respects the financial position of
reuters group plc and its subsidiaries at 31 december 2006 and 2005
and the results of their operations and cash flows for each of the three
years in the period ended 31 december 2006 in conformity with
international financial reporting standards ifrss as adopted by the
european union these financial statements are the responsibility of
the group’s management our responsibility is to express an opinion
on these financial statements based on our audits we conducted our
audits of these financial statements in accordance with the standards
of the public company accounting oversight board united states
those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
of material misstatement an audit of financial statements includes
examining on a test basis evidence supporting the amounts and
disclosures in the financial statements assessing the accounting
principles used and significant estimates made by management and
evaluating the overall financial statements presentation we believe
that our audits provide a reasonable basis for our opinion
as discussed in the accounting policies the group adopted
international accounting standards ias 32 ‘financial instruments
disclosure and presentations’ ias 39 ‘financial instruments
recognition and measurement’ and ifrs 5 ‘noncurrent assets held
for sale and discontinued operations’ in accordance with ifrs as
adopted by the eu the change has been accounted for prospectively
from 1 january 2005 except for the disclosure requirements of ifrs 5
which were also applied to the comparative information
as discussed in the basis of accounting the group has restated its
consolidated financial statements for the year ended 31 december
2005 to reflect the share buyback agreement as a liability
ifrss as adopted by the european union vary in certain significant
respects from accounting principles generally accepted in the united
states of america information relating to the nature and effect of
such differences is presented in the summary of differences between
ifrs and us generally accepted accounting principles us gaap 
to the consolidated financial statements
internal control over financial reporting
also in our opinion management’s assessment included in the
accompanying managements’ evaluation of effectiveness of internal
control as set out in management’s report on internal control over
financial reporting within the ‘statements of directors’ responsibilities
and compliance’ section of this annual report that the group
maintained effective internal control over financial reporting as of 
31 december 2006 based on criteria established in internal control –
integrated framework issued by the committee of sponsoring
organizations of the treadway commission coso is fairly stated 
in all material respects based on those criteria furthermore in our
opinion the company maintained in all material respects effective
internal control over financial reporting as of 31 december 2006
based on criteria established in internal control – integrated
framework issued by the coso the company’s management is
responsible for maintaining effective internal control over financial
reporting and for its assessment of the effectiveness of internal control
over financial reporting our responsibility is to express opinions on
management’s assessment and on the effectiveness of the company’s
internal control over financial reporting based on our audit
we conducted our audit of internal control over financial reporting in
accordance with the standards of the public company accounting
oversight board united states those standards require that we plan
and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all
material respects an audit of internal control over financial reporting
includes obtaining an understanding of internal control over financial
reporting evaluating management’s assessment testing and
evaluating the design and operating effectiveness of internal control
and performing such other procedures as we consider necessary in
the circumstances we believe that our audit provides a reasonable
basis for our opinions
a company’s internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability 
of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting
standards and principles a company’s internal control over financial
reporting includes those policies and procedures that i pertain to the
maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the company
ii provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance
with generally accepted accounting standards and principles and that
receipts and expenditures of the company are being made only in
accordance with authorisations of management and directors of the
company and iii provide reasonable assurance regarding prevention
or timely detection of unauthorised acquisition use or disposition of
the company’s assets that could have a material effect on the financial
statements
because of its inherent limitations internal control over financial
reporting may not prevent or detect misstatements also projections
of any evaluation of effectiveness to future periods are subject to the
risk that controls may become inadequate because of changes in
conditions or that the degree of compliance with the policies or
procedures may deteriorate
pricewaterhousecoopers llp
london
15 march 2007
united states audit opinion 75 financials
reuters group plc annual report and form 20f 2006
consolidated income statement
for the year ended 31 december
2006 2005 2004
notes £m £m £m
revenue 01 02 2566 2409 2339
operating costs 03 2351 2251 2187
other operating income 04 41 49 42
operating profit 256 207 194
finance income 05 72 41 15
finance costs 05 87 53 27
profit on disposal of associates joint ventures and availableforsale financial assets 76 38 203
share of posttax lossesprofits from associates and joint ventures  15 4 511
profit before tax 313 238 396
taxation 06 20 9 40
profit for the year from continuing operations 293 229 356
profit for the year from discontinued operations 07 12 253 19
profit for the year 305 482 375
attributable to
equity holders of the parent 11 305 456 364
minority interest 11 – 26 11
earnings per share
from continuing and discontinued operations
basic earnings per ordinary share 08 236p 326p 260p
diluted earnings per ordinary share 08 231p 317p 254p
from continuing operations
basic earnings per ordinary share 08 226p 163p 254p
diluted earnings per ordinary share 08 222p 159p 248p
 share of posttax lossesprofits from associates and joint ventures includes a tax charge of £2 million 2005 £1 million 2004 £2 million
dividends paid and proposed during the year were £134 million 2005 £140 million paid and proposed 2004 £140 million paid and proposed please refer to note 32 on
page 119
consolidated statement of recognised income and expense
for the year ended 31 december
2006 2005 2004
notes £m £m £m
profit for the year 305 482 375
actuarial gainslosses on defined benefit plans 11 25 6 48 205
exchange differences taken directly to reserves 11 28 95 118 48
exchange differences taken to the income statement on disposal of assets 11 28 – 2 6
fair value gainslosses on availableforsale financial assets 11 28 6 15 –
fair value gains on availableforsale financial assets taken to the income statement on 
disposal of assets 11 – 73 –
fair value gainslosses on net investment hedges 11 28 34 39 –
fair value gains taken to the income statement on disposal of net investment hedges 11 28 – 14 –
tax on items taken directly to or transferred from equity 11 4 14 35
net losses not recognised in income statement 11 53 59 212
total recognised income for the year 252 423 163
attributable to
equity holders of the parent 252 374 166
minority interest – 49 3
the 2005 balance sheet has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’
on page 78 the impact of recognising these commitments is to increase current liabilities and to decrease shareholders’ equity at 31 december 2005 by £59 million
fair value gains and losses arise as a result of application of ias 39 by the group with effect from 1 january 2005 the adoption of ias 39 resulted in an increase in
equity at 1 january 2005 of £129 million of which £2 million was attributable to the minority interest
the consolidated reconciliation of changes in equity is set out in note 11 on pages 90–91 76
reuters group plc annual report and form 20f 2006
consolidated balance sheet
at 31 december
restated
2006 2005 2004
notes £m £m £m
assets
noncurrent assets
intangible assets 13 559 487 316
property plant and equipment 14 371 358 354
investments accounted for using the equity method
investments in joint ventures 15 19 32 29
investments in associates 15 19 46
deferred tax assets 26 281 276 292
other financial assets and derivatives 16 47 22 28
retirement benefit assets 25 18 ––
1314 1179 1025
current assets
inventories 18 1 13
trade and other receivables 19 258 270 535
other financial assets and derivatives 16 210 18 287
current tax debtors 8 67
cash and cash equivalents 20 129 662 578
606 957 1410
noncurrent assets classified as held for sale 21 – 1 145
total assets 1920 2137 2580
liabilities
current liabilities
trade and other payables 22 491 456 721
current tax liabilities 23 196 228 260
provisions for liabilities and charges 24 60 64 87
other financial liabilities and derivatives 16 166 49 181
913 797 1249
noncurrent liabilities
provisions for liabilities and charges 24 204 392 340
other financial liabilities and derivatives 16 521 371 329
deferred tax liabilities 26 110 66 45
835 829 714
liabilities directly associated with noncurrent assets classified as held for sale 21 – – 47
total liabilities 1748 1626 2010
net assets 172 511 570
shareholders’ equity
share capital 27 496 467 455
other reserves 28 1738 1692 1755
retained earnings 11 1414 1736 1671
total parent shareholders’ equity 172 511 371
minority interest in equity – – 199
total equity 172 511 570
2005 has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78
the impact of recognising these commitments is to increase current liabilities and to decrease shareholders’ equity at 31 december 2005 by £59 million
the financial statements on pages 75–128 and the summary of differences between ifrs and us gaap on pages 129–133 were approved by the board of directors
on 15 march 2007
tom glocer david grigson
ceo cfo 77 financials
reuters group plc annual report and form 20f 2006
consolidated cash flow statement
for the year ended 31 december
2006 2005 2004
notes £m £m £m
cash flows from operating activities
cash generated from operations 29 311 271 280
interest received 42 55 19
interest paid 61 49 30
tax paid 34 24 43
net cash flow from operating activities 258 253 226
cash flows from investing activities
acquisitions net of cash acquired 30 67 124 78
disposals net of cash disposed 30 65 246 438
purchases of property plant and equipment 122 145 109
proceeds from sale of property plant and equipment 5 366
purchases of intangible assets 106 40 27
purchases of availableforsale financial assets – 1 1
proceeds from sale of availableforsale financial assets – 85 25
dividends received 3 55
net cash flow from investing activities 222 29 319
cash flows from financing activities
proceeds from issue of shares 32 10 6
share buyback 527 223 –
increasedecrease in shortterm deposits 196 248 105
increasedecrease in borrowings 270 144 225
equity dividends paid to shareholders 134 140 140
equity dividends paid to minority interests – 23 –
net cash flow from financing activities 555 272 464
exchange lossesgains on cash and cash equivalents 13 66 33
net decreaseincrease in cash and cash equivalents 532 76 48
cash and cash equivalents at the beginning of the year 637 561 513
cash and cash equivalents at the end of the year 31 105 637 561 78
reuters group plc annual report and form 20f 2006
group accounting policies
the principal accounting policies adopted in the preparation of these financial
statements are set out below these policies have been consistently applied 
to 2006 2005 and 2004 unless otherwise stated
basis of accounting
the financial statements have been prepared under the historical cost
convention unless otherwise stated below and in accordance with the
companies act 1985 and applicable accounting standards
the preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain judgements
estimates and assumptions that affect the reported amounts of revenue and
expenses during the reported period the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the balance sheet
dates although these estimates are based on management’s best knowledge
of the amount event or actions actual results ultimately may differ from those
estimates
further details regarding areas requiring significant assumptions and estimates
are provided in the relevant notes to the financial statements
the areas which require a higher degree of judgement include impairments
intangible assets defined benefit pension plans sharebased payments
provisions segment reporting and taxation
the 2005 balance sheet has been restated to recognise irrevocable
commitments to repurchase shares during close periods as a liability during the
close period following the 2006 year end the group repurchased 120 million
shares 2005 135 million shares 2004 nil under these commitments at a total
cost of £53 million 2005 £59 million 2004 £nil the impact of recognising
these commitments is to increase current liabilities and to decrease
shareholders’ equity at 31 december 2006 by £53 million 2005 £59 million
2004 £nil there is no impact on reported profit cash flow or earnings per
share share repurchases under the buyback programme totalling £137 million
for the period 1 january 2006 to 7 march 2006 which included the £59 million
described above were previously disclosed under note 38 ‘postbalance sheet
events’ in the 2005 annual report and form 20f
adoption of international financial reporting
standards ifrs
prior to 2005 the group prepared its annual consolidated financial statements
under uk gaap  from 1 january 2005 the group is required to prepare its
annual consolidated financial statements in accordance with ifrs and
international financial reporting interpretations committee ifric
interpretations as adopted by the eu and those parts of the companies 
act 1985 applicable to companies reporting under ifrs
the group’s transition date to ifrs was 1 january 2004 all adjustments on first
time adoption were recorded in shareholders’ equity on the date of transition
except for adjustments relating to ias 32 ‘financial instruments disclosure and
presentation’ and ias 39 ‘financial instruments recognition and measurement’
which were recorded in shareholders’ equity at 1 january 2005
these financial statements take account of the requirements and options in 
ifrs 1 ‘firsttime adoption of international financial reporting standards’ as
those requirements and options relate to the 2004 comparatives included within
these financial statements
basis of consolidation
the consolidated financial statements include the financial statements of
reuters group plc and its subsidiaries and the group’s share of the post
acquisition results of associates and joint ventures
subsidiaries
subsidiaries are all entities over which the group has the power to govern the
financial and operating policies generally accompanying a shareholding of more
than 50 of the voting rights subsidiaries are consolidated from the date on
which control is transferred to the group and are deconsolidated from the date
on which control ceases
the purchase method of accounting is used to account for the acquisition of
subsidiaries by the group the excess of the cost of an acquisition over the fair
value of the group’s share of the identifiable net assets acquired is recorded as
goodwill if the cost of acquisition is less than the fair value of the net assets of
the subsidiary acquired the difference is recognised directly in the income
statement
all intragroup transactions are eliminated as part of the consolidation process
in preparing the group financial statements accounting policies of subsidiaries
have been adjusted where necessary to ensure consistency with the accounting
policies adopted by the group
associates and joint ventures
associates are all entities over which the group has significant influence but not
control generally accompanying a shareholding of between 20 and 50 of
the voting rights joint ventures are all entities over which the group has joint
control with one or more other entities outside the group investments in
associates and joint ventures are accounted for by the equity method of
accounting and are initially recognised at cost the group’s investment in
associates and joint ventures includes goodwill and intangibles identified on
acquisition plus the group’s share of postacquisition reserves
the group’s share of postacquisition profits or losses is recognised in the
income statement and its share of postacquisition movements in reserves is
recognised in reserves when the group’s share of losses of an associate or joint
venture equals or exceeds its interest in the associate or joint venture the
group does not recognise further losses unless it has incurred obligations or
made payments on behalf of the associate or joint venture
gains on transactions between the group and its associates and joint ventures are
eliminated to the extent of the group’s interest for group reporting purposes
the results of associates and joint ventures have been adjusted where necessary 
to ensure consistency with the accounting policies adopted by the group
foreign currency translation
amounts included in the financial statements of each of the group’s entities 
are measured using the currency of the primary economic environment in 
which the entity operates the functional currency the consolidated financial
statements are presented in pounds sterling the company’s functional and
presentation currency
transactions in foreign currencies are translated into the functional currency
using the exchange rate prevailing at the date of the transaction foreign
exchange gains and losses resulting from settlement of such transactions and
from the translation at year end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the income statement
except when deferred in equity as qualifying cash flow and net investment
hedges
exchange differences on nonmonetary items such as availableforsale financial
assets are included in the fair value reserve in equity 
the results and financial position of all group companies that have a functional
currency other than sterling are translated as follows
• income and expenses are translated at average exchange rates unless this
average is not a reasonable approximation of the cumulative effect of the rate
prevailing on the transaction date in which case income and expenses are
translated at the date of the transaction
• assets and liabilities are translated at the closing exchange rate at the date 
of the balance sheet and
• all resulting exchange differences are recognised as a separate component 
of equity
on consolidation exchange differences arising from the translation of the net
investment in foreign entities and from borrowings and other currency
instruments designated as hedges of such investments are taken to equity
when a foreign operation is sold such exchange differences are recognised 
in the income statement as part of the gain or loss on sale
goodwill and fair value adjustments on the acquisition of a foreign entity are
treated as assets and liabilities of the foreign entity and translated at the closing
exchange rate
revenue recognition
revenue represents the turnover net of discounts derived from services
provided to subscribers and sales of products applicable to the year 79 financials
reuters group plc annual report and form 20f 2006
revenue from sales of subscriptionbased real time and historical information
services is recognised rateably over the term of the subscription
revenue from contracts for the outright sale of systemsbased product
solutions which include the sale of fully developed software licences is
recognised at the time of client acceptance at which time the group has no
further obligation longterm contracts are accounted for in accordance with 
the contractual terms either on a percentage of completion basis or on a time
and materials as incurred basis
revenue from associated maintenance and support services is recognised
rateably over the term of the maintenance contract where contracts allow 
the group to recharge costs from communications suppliers and exchanges
onwards to subscribers this income is recognised as revenue
transaction products usage revenue is accounted for on a trade date basis
interest income is accrued on a time basis by reference to the amount
outstanding and at the effective interest rate applicable which is the rate that
exactly discounts estimated future cash receipts through the expected life of 
the financial asset to that asset’s net carrying value
pensions and similar obligations
the group operates defined contribution and defined benefit pension plans
and provides postretirement medical benefits
payments to defined contribution pension plans are charged as an expense to
the income statement as incurred when the related employee service is
rendered the group has no further legal or constructive payment obligations
once the contributions have been made
for defined benefit pension plans the cost of providing benefits is determined
using the projected unit credit method and is charged to the income statement
so as to spread the service cost over the service lives of the employees an
interest cost representing the unwinding of the discount rate on the scheme
liabilities net of the expected return on scheme assets is charged to the
income statement the liability recognised in the balance sheet in respect of
defined benefit pension plans is the present value of the defined benefit
obligation at the balance sheet date less the fair value of the plan assets the
defined benefit obligation is calculated annually by independent actuaries the
present value of the defined benefit obligation is determined by discounting
the estimated future cash outflows using interest rates of highquality corporate
bonds that are denominated in a currency in which the benefits will be paid 
and that have terms of maturity approximating to the terms of the relevant
pension liability
all actuarial gains and losses which arise in calculating the present value of the
defined benefit obligation and the fair value of plan assets are recognised
immediately in the statement of recognised income and expense
postretirement medical benefits are provided to employees of some group
companies the expected costs are determined using an accounting
methodology similar to that for defined benefit pension plans
sharebased payments
the group makes equitysettled and cashsettled sharebased payments to its
employees equitysettled sharebased awards granted after 7 november 2002
but not vested by 1 january 2005 are measured at fair value at the date of grant
using an options pricing methodology and expensed over the vesting period 
of the award at each balance sheet date the group reviews its estimate of the
number of options that are expected to vest
cashsettled sharebased payments are accrued over the vesting period of the
award based on the current fair market value at each balance sheet date
when share options are exercised the proceeds received net of any transaction
costs are credited to share capital nominal value and share premium
intangible assets
goodwill
goodwill represents the excess of the cost of an acquisition over the fair value
of the group’s share of the identifiable net assets including intangible assets 
of the acquired subsidiary associate or joint venture at the date of acquisition
goodwill on acquisition of subsidiaries is included in intangible assets goodwill
and intangibles on acquisition of associates and joint ventures is included in the
carrying value of the investment goodwill is tested annually for impairment 
and carried at cost less accumulated impairment losses gains and losses on
disposal of an entity include the carrying amount of goodwill relating to the
entity or investment sold
internally generated intangible assets
expenditure related to the development of new products or capabilities that is
incurred between establishing technical feasibility and the asset becoming
ready for use is capitalised as an intangible asset and amortised over the useful
economic life capitalisation commences from the point at which the technical
feasibility and commercial viability of the product or capability can be
demonstrated and the group is satisfied that it is probable that future economic
benefits will result from the product or capability once completed capitalisation
ceases when the product or capability is ready for use
expenditure on research activities and on development activities that do not
meet the above criteria is charged to the income statement as incurred
internally developed intangible assets are systematically amortised on a straight
line basis over their useful economic lives which range from three to five years
other intangibles
software which forms an integral part of the related hardware is capitalised with
that hardware and included within property plant and equipment
costs which are directly associated with the production of software for internal
use in the business are capitalised as an intangible asset software assets are
amortised on a straight line basis over their expected useful economic lives
which range from three to five years
acquired intangible assets include software licences customer relationships
trade names and trademarks these assets are capitalised on acquisition and
amortised over their expected useful economic lives which range from five to
fifteen years
impairment of assets
goodwill is not subject to amortisation and is tested annually for impairment
all other assets are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be recoverable in
addition intangible assets under development and not yet ready for use are
reviewed for impairment annually an impairment loss is recognised for the
amount by which the asset’s carrying amount exceeds its recoverable amount
the recoverable amount is the higher of an asset’s fair value less cost to sell 
and value in use
for the purposes of assessing impairment assets are grouped at the lowest
level for which separately identifiable cash flows exist cash generating units
‘cgus’ where assets do not generate independent cash flows and their
carrying value cannot be attributed to a particular cgu cgus are grouped
together at the level at which these assets reside and the carrying amount of
this group of cgus is compared to the recoverable amount of that particular
group
property plant and equipment
all items of property plant and equipment are stated at historical cost less
depreciation including expenditure directly attributable to the acquisition of 
the items subsequent costs are included in the asset’s carrying amount or
recognised as a separate asset as appropriate only when it is probable that
future economic benefit will flow to the group and the cost of the item can 
be measured reliably
depreciation is calculated on a straight line basis so as to write down the assets
to their residual values over their expected useful lives which are as follows
freehold land not depreciated
freehold buildings normally 50 years
leasehold property over the term of the lease
computer systems equipment office equipment 
and motor vehicles 2 to 5 years
the assets’ residual values and useful lives are reviewed and adjusted if
appropriate at each balance sheet date 80
reuters group plc annual report and form 20f 2006
group accounting policies continued
noncurrent assets held for sale 
effective 1 january 2005
noncurrent assets and disposal groups are classified as held for sale if their
carrying amount is expected to be recovered principally through a sale
transaction rather than through continuing use this condition is regarded as
met only when the sale is highly probable and the asset is available for
immediate sale in its present condition
noncurrent assets and disposal groups classified as held for sale are measured
at the lower of carrying amount and fair value less selling costs
for 2004 comparatives the group has applied the disclosure requirements 
for assets held for sale as at 31 december 2004 balance sheet values have 
not been restated in accordance with ifrs 5 ‘noncurrent assets held for sale
and discontinued operations’
investments effective 1 january 2005
classification
the group classifies its investments in the following categories
• financial assets at fair value through profit and loss
• loans and receivables and
• availableforsale financial assets
the classification depends on the purpose for which the assets were acquired
management determines the classification of its investments at initial
recognition and reevaluates this designation at every reporting date
financial assets at fair value through profit and loss
this category includes financial assets held for trading and those designated at
fair value through profit and loss at inception a financial asset is classified in
this category if acquired principally for the purpose of selling in the shortterm
or if so designated by management derivatives are also classified as held for
trading unless they are designated as hedges assets in this category are initially
recognised at fair value on the trade date and subsequently remeasured at each
reporting date transaction costs directly attributable to the acquisition of the
asset are recognised immediately in the income statement realised and
unrealised gains and losses are included in the income statement in the period
in which they arise
loans and receivables
loans and receivables are nonderivative financial assets with fixed or
determinable payments that are not quoted in an active market assets in this
category are initially recognised on the trade date at fair value plus transaction
costs and subsequently measured at amortised cost using the effective interest
method
availableforsale financial assets
the group has classified all of its marketable securities as availableforsale
assets in this category are initially recognised on the trade date at fair value 
plus transaction costs and subsequently remeasured at each reporting date
unrealised gains and losses arising from changes in fair value are recognised 
in the statement of recognised income and expense
impairment and derecognition
the group assesses at each balance sheet date whether there is objective
evidence that a financial asset or group of financial assets is impaired on
impairment the cumulative loss recognised in equity is removed from equity
and recognised in the income statement on disposal of the asset gains or
losses recognised in equity are removed from equity and recognised in the
income statement
cash and cash equivalents
cash and cash equivalents include cash in hand bank deposits repayable on
demand other highly liquid investments with original maturities of three months
or less and bank overdrafts
inventories and contract work in progress
inventories and contract work in progress are valued at the lower of cost and 
net realisable value less progress payments received
trade receivables
trade receivables do not carry interest and are initially measured at their fair
value as reduced by appropriate allowances for estimated irrecoverable
amounts and subsequently measured at amortised cost a provision for
impairment of trade receivables is established when there is evidence that the
group will not be able to collect all amounts due according to the original
terms of these receivables the amount of the provision is the difference
between the carrying value and the present value of estimated future cash
flows discounted at the effective interest rate the amount of the provision 
is recognised in the income statement
provisions
provisions other than in respect of pension and postretirement benefits are
recognised when the group has a present legal or constructive obligation as 
a result of past events it is more likely than not that an outflow of resources will
be required to settle the obligation and the amount can be reliably estimated
restructuring provisions comprise lease termination liabilities employee
termination payments and other liabilities incurred as part of restructuring
programmes
leasing
assets under leasing contracts are classified as finance or operating leases at
the inception of the lease or when changes are made to existing contracts
assets classified as finance leases are recognised as assets of the group at the
present value of the minimum lease payments determined at the inception of
the lease the corresponding liability to the lessor is included in the balance
sheet as a finance lease obligation lease payments are apportioned between
finance charges and reduction of the lease obligation so as to achieve a
constant rate of interest on the remaining balance of the liability
operating lease rentals are recognised in the income statement on a straight
line basis over the period of the lease operating lease incentives received are
initially deferred and then recognised over the full period of the lease
borrowings
borrowings are initially recognised at fair value net of transaction costs incurred
and are subsequently stated at amortised cost adjusted for fair value
movements in respect of related fair value hedges any difference between the
proceeds net of transaction costs and the redemption value is recognised in
the income statement over the period of the borrowings using the effective
interest method
borrowings are classified as current liabilities unless the group has an
unconditional right to defer settlement of the liability for at least twelve months
after the balance sheet date
borrowing costs on qualifying assets are expensed as incurred and not
capitalised as part of the cost of the asset
purchases and sales of financial assets
purchases and sales of financial assets are recognised on the settlement date
which is the date that the asset is delivered to or by the group
derivative financial instruments and hedging
effective 1 january 2005
derivatives are initially recognised at fair value on the date a derivative contract
is entered into and are subsequently remeasured at their fair value the method
of recognising the resulting gain or loss depends on whether the derivative is
designated as a hedging instrument and if so the nature of the item being
hedged the group designates certain derivatives as either
• hedges of the fair value of recognised assets or liabilities or a firm
commitment fair value hedges
• hedges of highly probable forecast transactions cash flow hedges or
• hedges of net investments in foreign operations net investment hedges
fair value hedges
changes in the fair value of derivatives that are designated and qualify as fair
value hedges are recorded in the income statement together with any changes
in the fair value of the hedged asset or liability that are attributable to the 81 financials
reuters group plc annual report and form 20f 2006
hedged risk the gain or loss relating to the ineffective portion is recognised
immediately in finance costs
cash flow hedges
the effective portion of changes in the fair value of derivatives that are
designated and qualify as a cash flow hedge is recognised in equity the gain or
loss relating to the ineffective portion is recognised immediately in the income
statement
amounts accumulated in equity are recycled to the income statement in the
period when the hedged item will affect profit and loss for instance when the
forecast sale that is hedged takes place however when the forecast
transaction that is hedged results in the recognition of a nonfinancial asset for
example project costs or a major business investment or a liability the gains
and losses previously deferred in equity are transferred from equity and
included in the initial measurement of the cost of the asset or liability when 
a hedging instrument expires or is sold or when a hedge no longer meets the
criteria for hedge accounting any cumulative gain or loss existing in equity at
that time remains in equity and is recognised when the forecast transaction is
ultimately recognised in the income statement when a forecast transaction is
no longer expected to occur the cumulative gain or loss that was reported in
equity is immediately recognised in the income statement
net investment hedges
derivatives and foreign currency borrowings are used as hedges for net
investments in foreign operations any gain or loss on a derivative hedging
instrument relating to the effective portion of the hedge is recognised in equity
the gain or loss relating to the ineffective portion of the hedge is recognised
immediately in the income statement any gain or loss on foreign currency
borrowings used as a hedge is recognised in equity subject to effectiveness
gains and losses accumulated in equity are recognised in the income statement
on disposal of the foreign operation
embedded derivatives
embedded derivatives arise in certain revenue and purchase contracts where
the currency of the contract is different from the functional currencies of the
parties involved such derivatives are separated from the host contracts when
their economic characteristics and risks are not closely related to those of the
host contract the derivatives are measured at fair value at each balance sheet
date using forward exchange market rates changes in the fair value are
recognised in the income statement
derivatives that do not qualify for hedge accounting
certain derivative instruments while providing effective economic hedges under
the group’s policies are not designated as hedges changes in the fair value of
any derivative instruments that do not qualify for hedge accounting are
recognised immediately in the income statement
financial guarantees
financial guarantees are nonderivative financial liabilities which are recognised
initially at fair value plus transaction costs and subsequently measured at the
higher of the amount determined in accordance with ias 37 ‘provisions
contingent liabilities and contingent assets’ and the amount initially recognised
fair value estimation effective 1 january 2005
the fair value of financial instruments traded in active markets such as available
forsale securities is based on quoted market prices at the balance sheet date 
the fair value of foreign exchange contracts is determined using forward exchange
market rates at the balance sheet date other financial instruments are valued
using standard pricing models based on quoted forward market rates interpolated
between dates where appropriate and discounted cash flow techniques
embedded derivatives arise in revenue and supplier contracts where the
currency of the contract is different from the functional currencies of the parties
involved the derivatives are separated from the host contracts and valued
using quoted forward market rates
interest in shares of reuters group plc
shares held by the reuters employee share ownership trusts and repurchased
shares are recorded in the balance sheet at cost and reported as a deduction
from shareholders’ equity
irrevocable commitments to repurchase shares during close periods entered
into before the balance sheet date are recorded in the balance sheet at
estimated cost and reported as a current liability with a corresponding
deduction from shareholders’ equity
dividend distribution
dividend distributions are recognised as a liability in the period in which the
dividends are approved by the company’s shareholders interim dividends are
recognised when they are paid final dividends when authorised in general
meeting by shareholders
taxation
the tax expense for the year comprises current and deferred tax tax is
recognised in the income statement except to the extent that it relates to items
recognised directly in equity in which case it is recognised in equity
the current tax expense is based on the results for the year as adjusted for
items that are not taxable or not deductible current tax is calculated using tax
rates and laws that have been enacted or substantively enacted at the balance
sheet date
deferred tax is accounted for using the balance sheet liability method and is
the tax expected to be payable or recoverable on temporary differences
between the carrying amount of assets and liabilities in the financial statements
and the corresponding tax bases used in the computation of taxable profit
deferred tax is calculated based on the expected manner of realisation or
settlement of the carrying amount of assets and liabilities using tax rates that
are expected to apply to the year of realisation or settlement based on tax rates
and laws enacted or substantively enacted at the balance sheet date
deferred tax liabilities are generally recognised for all taxable temporary
differences deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries associates and joint ventures
except where the reversal of the temporary difference can be controlled and it 
is probable that the difference will not reverse in the foreseeable future
deferred tax assets are recognised to the extent it is probable that taxable
profits will be available against which the deductible temporary differences can
be utilised the carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part of the asset to be
recovered deferred tax assets and liabilities are not recognised if the temporary
differences arise from goodwill not deductible for tax purposes or from the
initial recognition other than in a business combination of other assets and
liabilities in a transaction that affects neither the taxable profit nor the
accounting profit
segment reporting
business segmentation is the primary reporting dimension for the group 
with geographical segmentation being the secondary reporting dimension
accordingly the four business divisions sales  trading research  asset
management enterprise and media and instinet group in 2004 are the
primary reporting segments for the group
note 1 on page 83 outlines in detail the allocation approach in respect of
divisional results costs assets and liabilities
standards interpretations and amendments to
published standards that are not yet effective
certain new standards amendments and interpretations to existing standards
have been published that are mandatory for the group for accounting periods
beginning on or after 1 january 2007 or later periods but which have not yet
been adopted by the eu or which the group has chosen not to adopt early 
the new standards which are expected to be relevant to the group’s operations
are as follows
ifrs 7 ‘financial instruments disclosures’ and ias 1 amendment ‘presentation
of financial statements – capital disclosures’ effective from 1 january 2007
ifrs 7 introduces new disclosures relating to the information about the group’s
financial instruments it requires the disclosure of qualitative and quantitative
information about exposure to risks arising from financial instruments including
specified minimum disclosures about credit risk liquidity risk and market risk
including sensitivity analysis to market risk it replaces ias 30 ‘disclosures in the
financial statements of banks and similar financial institutions’ and the 82
reuters group plc annual report and form 20f 2006
disclosure requirements in ias 32 ‘financial instruments disclosure and
presentation’ the amendment to ias 1 introduces disclosures about the level 
of an entity’s capital and its objectives policies and processes for managing its
capital the group has assessed the impact of ifrs 7 and the amendment to
ias 1 and concluded that the exisiting disclosures on risk management policies
in the ofr would be further expanded to include additional sensitivity analysis
and management of the company’s capital the group will apply ifrs 7 and the
amendment to ias 1 from 1 january 2007
ifrs 8 ‘operating segments’ effective from 1 january 2009
ifrs 8 replaces ias 14 ‘segment reporting’ and aligns segment reporting with
the requirements of us accounting standard fas 131 ‘disclosures about
segments of an enterprise and related information’ the new standard uses a
‘management approach’ under which segment information is presented on the
same basis as that which used for internal reporting purposes the group has
assessed the impact of ifrs 8 and concluded that segment reporting will
continue to be focused on the business divisions with the distinction between
primary and secondary segments being removed
ifric 7 ‘applying the restatement approach under ias 29’ 
effective from 1 january 2007
ifric 7 provides guidance in respect of the firsttime application of ias 29
‘financial reporting in hyperinflationary economies’ when an entity identifies
the existence of hyperinflation in the economy of its functional currency the
group has assessed the impact of the interpretation and concluded that it is 
not likely to have a significant effect on the group’s financial statements
ifric 8 ‘scope of ifrs 2’ effective from 1 january 2007
ifric 8 clarifies that transactions within the scope of ifrs 2 ‘sharebased
payment’ include those in which the entity cannot specifically identify some 
or all of the goods or services received if the identifiable consideration given
appears to be less than the fair value of the equity instruments granted or
liability incurred this situation typically indicates that other consideration has
been or will be received the group has assessed the impact of the
interpretation and concluded that it is not likely to have a significant effect 
on the group’s financial statements
ifric 9 ‘reassessment of embedded derivatives’ 
effective from 1 january 2007
ifric 9 clarifies that an entity should assess whether an embedded derivative 
is required to be separated from the host contract and accounted for as a
derivative when the entity first becomes a party to the contract subsequent
reassessment is prohibited unless there is a change in the contract’s terms 
in which case it is required the group has assessed the impact of the
interpretation and concluded that it will not have a significant effect on the
group’s financial statements
ifric 10 ‘interim financial reporting and impairment’ 
effective from 1 january 2007
ifric 10 clarifies that a reporting entity shall not reverse an impairment loss
recognised in a previous interim period in respect of goodwill or investment in
either an equity instrument or a financial asset carried at cost the group will
apply the requirements of ifric 10 if it chooses to prepare the interim financial
statements under the requirements of ias 34 in 2007 from 1 january 2008 the
adoption of ias 34 is mandatory the group does not currently apply ias 34
therefore the interpretation currently has no impact on the group’s financial
statements
ifric 11 ‘ifrs 2 – group and treasury share transactions’ 
effective from 1 january 2008
ifric 11 addresses sharebased payment arrangements in which a an entity
grants its employees a right to equity instruments of the entity and either
chooses or is required to buy those equity instruments from another party or the
shareholder provides the equity instruments needed to settle the sharebased
payment arrangement and b a subsidiary entity’s employees are granted rights
to equity instruments of the parent entity or another entity in the same group
in particular arrangements in which the parent entity or the subsidiary entity
grants those rights direct to the subsidiary entity’s employees the group has
assessed the impact of the interpretation and concluded that it is not likely to
have a significant effect on the group’s financial statements
applicable accounting policies for 2004
comparatives
ias 32 and ias 39 were adopted by the group at 1 january 2005 the
comparative information in 2004 for financial instruments within the scope of
ias 39 is determined under the previous accounting policies in accordance with
uk gaap  those policies include
investments
government securities are stated in the balance sheet at the lower of cost plus
accrued capital appreciation and market value income from these securities
and any adjustment for changes in their market value during the year is
reported as part of profit
debt issuance
mediumterm notes and commercial paper are stated at the amount of the net
proceeds plus accrued interest or any discount or premium discounts or
premiums to the nominal value are amortised over the term of the issue costs
associated with debt issuance are charged against profit over the life of the
instrument
foreign currency swap agreements and forward contracts are used to convert
nonsterling debt into sterling interest rate swaps swaptions and forward rate
agreements are used to manage interest rate exposures amounts payable or
receivable in respect of these derivatives are recognised as adjustments to
interest expense over the period of the contract
treasury
the group receives revenue and incurs expenses in more than 70 currencies
and uses financial instruments to hedge a portion of its net cash flow and
operating profit
the derivative contracts are treated from inception as an economic hedge of
the underlying financial instrument with matching accounting treatment and
cash flows the derivative contracts have high correlation with the specific
underlying risks being hedged both at inception and throughout the 
hedge period
the group uses financial instruments to hedge a portion of its interest
exposure profits and losses on financial instruments are reported as part 
of profit for the period to which they relate
financial instruments hedging the risk on foreign currency assets are revalued 
at the balance sheet date and the resulting gain or loss offset against that
arising from the translation of the underlying asset into sterling
the group does not hold or issue derivative financial instruments for 
speculative purposes
group accounting policies continued reuters group plc annual report and form 20f 2006
83 notes to the financial statements 
01 segmental analysis – income statement
primary reportable segments – business divisions
the group operates through four business divisions sales  trading research
 asset management enterprise and media excluding instinet group in 2004
therefore the group’s primary segmental reporting is by business division in
order to report segmental results it is necessary to determine a methodology to
allocate revenue operating costs other operating income assets and liabilities
to these segments
each division is responsible for specific product revenues with the exception of
reuters 3000 xtra and the 20003000 range of products revenues for these
shared products are attributed to either the sales  trading division or the
research  asset management division by reference to the nature of the
customer purchasing the product this is determined on a customerby
customer basis
where operating costs relate to a specific division they are mapped directly to
that division where operating costs are shared an activity based costing abc
technique is used to split these costs between divisions the reuters abc
model known as profitability insight allocates shared costs to business
activities which in turn are attributed to products and therefore divisions using
cost drivers these cost drivers such as the number of helpdesk calls received
or the number of installed accesses are derived from a variety of underlying
source systems judgement has been applied in determining these cost drivers
and the resulting allocation of operating costs
other operating income is allocated to divisions using a similar methodology 
to operating costs
divisional results could alter with the application of other allocation approaches
and as continuous improvements are made to the profitability insight model
when changes are made to the allocation methodology prior year
comparatives are restated to ensure that divisional results are allocated on 
a consistent basis yearonyear
in 2006 reuters made changes to the allocation of revenue and operating costs
between business divisions to reflect changes in the management of certain
products 2005 comparatives have therefore been restated to increase sales 
 trading revenue by £18 million 2004 £11 million and operating costs by 
£19 million 2004 £11 million decrease research  asset management revenue
by £10 million 2004 £3 million and operating costs by £12 million 2004 
£6 million and decrease enterprise revenue by £8 million 2004 £8 million 
and operating costs by £7 million 2004 £5 million 2005 comparatives have 
also been restated to reallocate £1 million of amortisation on intangible assets
arising on the acquisition of telerate from enterprise to sales  trading in line
with the allocation of revenues from telerate products
the tables below show a segmental analysis of results for continuing operations 
for information relating to discontinued operations please refer to note 7 on pages 87–88
2006
research
 asset
sales  manage
trading ment enterprise media total
£m £m £m £m £m
revenue 1690 298 408 170 2566
operating costs 1543 315 335 158 2351
other operating income 27 563 41
operating profitloss 174 12 79 15 256
finance income 72
finance costs 87
profit on disposal of associates joint ventures and availableforsale financial assets 76
share of posttax losses from associates and joint ventures 4
profit before tax 313
taxation 20
profit for the year from continuing operations 293
restated
2005
research
 asset
sales  manage
trading ment enterprise media total
£m £m £m £m £m
revenue 1613 258 385 153 2409
operating costs 1495 293 317 146 2251
other operating income 37 – 8 4 49
operating profitloss 155 35 76 11 207
finance income 41
finance costs 53
profit on disposal of associates joint ventures and availableforsale financial assets 38
share of posttax profits from associates and joint ventures 5
profit before tax 238
taxation 9
profit for the year from continuing operations 229
financials reuters group plc annual report and form 20f 2006
01 segmental analysis – income statement continued
restated
2004
research
 asset
sales  manage
trading ment enterprise media total
£m £m £m £m £m
revenue 1553 259 383 144 2339
operating costs 1396 289 360 142 2187
other operating income 18 17 5 2 42
operating profitloss 175 13 28 4 194
finance income 15
finance costs 27
profit on disposal of associates joint ventures and availableforsale financial assets 203
share of posttax profits from associates and joint ventures 11
profit before tax 396
taxation 40
profit for the year from continuing operations 356
divisional revenue comprises sales to external customers only divisional revenue from transactions with other segments is £nil 2005 £nil 2004 £nil
the following table shows the aggregate of each business division’s share of results of associates and joint ventures
2006 2005 2004
£m £m £m
sales  trading 4 22
research  asset management – ––
enterprise – –3
media – 36
share of posttax lossesprofits from associates and joint ventures 4 511
the following table provides information relating to depreciation amortisation impairments and other significant noncash expenses included in the divisional
operating costs above
restated
2006 2005 2004
depreciation other depreciation other depreciation other
and noncash and noncash and noncash
amortisation impairments expenses amortisation impairments expenses amortisation impairments expenses
£m £m £m £m £m £m £m £m £m
sales  trading 95 – 36 89 139832213
research  asset management 19 – 7 19 – 4 16 83
enterprise 22 – 8 20 1 2 35 5 5
media 5– 3 4116 – 1
total 141 – 54 132 3 46 140 35 22
impairments for 2004 exclude the £17 million impairment of the goodwill previously reported within the sales  trading division in respect of bridge trading
company btc as this impairment has been reported within discontinued operations see note 7 on page 87
please refer to note 13 on page 94 for more information relating to impairments
secondary reportable segments – geographical
revenue is normally invoiced in the same geographical area in which the customer is located revenue earned therefore generally represents revenue both by
origin and by destination
the following table represents revenue from external customers by geographical area based on the geographical location of the customers
2006  2005  2004
£m change £m change £m
europe middle east  africa  1396 5 1330 1 1344
americas 709 9 651 7 609
asia 461 7 428 11 386
total revenue 2566 7 2409 3 2339
 to reflect the way reuters was managed in 2006 uk  ireland emea west and emea east have been combined into one geographical location
84 notes to the financial statements continued reuters group plc annual report and form 20f 2006
02 revenue by type
an analysis of the group’s revenue from sale of goods and services by type is set out below
restated restated
2006  2005  2004
£m change £m change £m
recurring 2363 6 2235 4 2158
usage 132 26 104 13 92
outright 71 3 70 22 89
total revenue 2566 7 2409 3 2339
2005 and 2004 have been restated to reclassify £7 million and £6 million respectively of recurring revenue to usage revenue
customers generally pay for reuters products and services in three ways recurring revenue is generated through subscription fees to cover access of terminals and
maintenance fees for software usage revenue is principally derived from matching and trading transactions and advertising revenues outright revenue comprises
onceoff sales including information and risk management solutions
03 operating costs
2006  2005  2004
cost by nature £m change £m change £m
salaries commission and allowances 763 – 761 3 782
social security costs 64 4 67 7 63
sharebased payments see note 33 30 1 30 38 22
pension costs see note 25 61 14 55 92 28
total staff costs 918 1 913 2 895
services  512 13 455 15 394
depreciation 95 4 99 11 112
data 323 15 281 14 247
communications 279 3 289 4 301
space 151 7 162 8 175
amortisation of intangibles 46 37 33 15 28
impairments –– 3 90 35
fair value movements on derivatives 25 – –––
fair value movements on other financial assets –– 16 – –
foreign exchange losses 2– –––
total operating costs 2351 4 2251 3 2187
operating costs include
research and development expenditure 83 9 92 13 105
operating lease expenditure
hire of equipment 66 6 22 7
other principally property 74 9 67 4 70
loss on disposal of property plant and equipment –– –– 1
advertising 19 9 17 14 20
 services include equipment hire and boughtin services including consultancy and contractors advertising and publicity professional fees and staffrelated expenses
an analysis of fees payable by the group to the company’s auditors is set out below
2006 2005
£m £m
fees payable to the company’s auditor for the audit of the company’s annual accounts 22 29
fees payable to the company’s auditor and its associates for other services
the audit of the company’s subsidiaries pursuant to legislation 13 13
other services pursuant to legislation 06 04
tax services 10 26
services relating to corporate finance transactions 02 04
all other services 02 03
total fees payable 55 79
united kingdom 39 38
overseas 16 41
the directors consider it important that the company has access to a broad range of external advice including from pricewaterhousecoopers where appropriate
work is put out to competitive tender the audit committee monitors the relationship with pricewaterhousecoopers including the level of nonaudit fees
85 financials reuters group plc annual report and form 20f 2006
04 other operating income
2006  2005  2004
£m change £m change £m
profit on disposal of subsidiaries 4 4 45 4
fair value movements on derivatives 6 69 18 – –
investment income –– 1––
foreign exchange gains –– 3– 1
profit on disposal of property plant and equipment 2– –––
other income 29 28 23 39 37
total other operating income 41 16 49 16 42
other income principally comprises amounts received in respect of services provided by reuters to joint ventures and other parties
05 finance income and finance costs
2006 2005 2004
£m £m £m
interest receivable
listed investments – 1–
unlisted investments 16 18 15
swap contracts 33 18 –
fair value gains on financial instruments 16 1–
foreign exchange gains on borrowings 7 3–
total finance income 72 41 15
interest payable
bank loans and overdrafts 6 4 2
other borrowings 23 23 24
swap contracts 38 22 –
fair value losses on financial instruments 19 2 –
unwinding of discounts 1 2 1
total finance costs 87 53 27
following the adoption of ias 39 ‘financial instruments recognition and measurement’ on 1 january 2005 derivatives are recognised separately from the
underlying borrowings to which they relate in 2005 and 2006 therefore interest on derivatives has been recognised separately from interest on the underlying
borrowings this treatment is different from the 2004 treatment where interest on derivatives was netted against interest on the underlying borrowings
06 taxation
analysis of charge for the period
2006 2005 2004
£m £m £m
current tax
continuing operations 10 10 17
discontinued operations 12 50 21
2 40 38
deferred tax see note 26
continuing operations 30 19 23
discontinued operations 12 13 1
18 32 24
continuing operations 20 940
discontinued operations – 63 22
total tax 20 72 62
86 notes to the financial statements continued reuters group plc annual report and form 20f 2006
87
tax on items recognised in equity
2006 2005 2004
continuing discontinued continuing discontinued continuing discontinued
£m £m £m £m £m £m
current tax creditcharge on unrealised exchange movements 7 – – – 10 –
deferred tax chargecredit on actuarial losses on defined benefit plans 1– 10 – 45 –
deferred tax credit on stock options 1 – 10 1 8 1
current tax chargecredit on revaluations and fair value movements 10 – 4 – – –
factors affecting tax charge for the period
the tax assessed for the period is lower than the standard rate of corporation tax in the uk 30 the differences are explained below
2006 2005 2004
£m £m £m
profit before tax 313 238 396
profit before tax multiplied by standard rate of corporation tax in the uk 
of 30 2005 30 2004 30 94 71 119
effects of
nontax deductible amortisation and impairment of intangibles 5 411
expenses not deductible for tax purposes 2 411
nontaxable investment disposals and impairments 15 13 66
adjustments in respect of prior years 56 23 26
recognition of tax losses that arose in prior years 4 33 –
other differences 6 1 9
total tax for continuing operations 20 940
the tax charge for the year includes a tax credit of £34 million 2005 £16 million in respect of uk taxation
07 discontinued operations
the ‘profit for the year from discontinued operations’ line within the income statement comprises the posttax profit or loss of discontinued operations and the
posttax profit or loss on their disposal
the group has no activities which are required to be classified as discontinued operations during 2006 however an additional gain of £12 million has been
recognised in 2006 relating to the disposal of instinet group which was classified as a discontinued operation during 2005
2006 2005 2004
£m £m £m
profits after tax of subsidiaries acquired with a view to resale – –1
profits after tax of subsidiaries net of tax £nil 2005 £20 million 2004 £22 million – 69 39
profitloss on disposal of subsidiaries net of tax £nil 2005 £43 million 2004 £nil 12 184 1
impairment of subsidiaries net of tax £nil 2005 £nil 2004 £nil – – 20
profit for the year from discontinued operations 12 253 19
basic earnings per ordinary share for discontinued operations 10p 163p 06p
diluted earnings per ordinary share for discontinued operations 09p 158p 06p
basic and diluted earnings per share are calculated using the weighted average number of ordinary shares as disclosed in note 8 on pages 88–89
discontinued operations in 2005 and 2004
subsidiaries acquired with a view to resale radianz
on 21 october 2004 reuters entered into exclusive discussions with bt to secure a longterm agreement for the provision of network services including the sale 
of radianz to bt as a prerequisite to this agreement reuters acquired equant’s 49 voting interest in radianz with a view to selling the 100 interest to bt
on 29 april 2005 reuters completed the sale of its 100 voting interest in radianz to bt for gross proceeds of £115 million
subsidiaries acquired with a view to resale are by definition discontinued operations under ifrs 5 however ifrs 5 was only applicable from 1 january 2005 whereas
reuters acquired the remaining 49 of the voting shares in radianz in november 2004 radianz was a subsidiary from this date and was therefore consolidated under
ias 27 ‘consolidated and separate financial statements’ for presentation purposes the results for the year and the balance sheet position at 31 december 2004 have
been presented using the income statement and balance sheet headings detailed in ifrs 5 the 2004 ‘profits after tax of subsidiaries acquired with a view to resale’ of
£1 million include a £9 million gain in respect of reuters share of the disposal by radianz of its voice services business offset by operating losses of radianz for the year
impairment of subsidiaries in 2004 includes £3 million in respect of impairment of radianz’s net assets to fair value less costs to sell
the disposal of radianz in 2005 resulted in a loss on disposal of £4 million which is presented within ‘profitloss on disposal of subsidiaries’ within discontinued
operations
financials reuters group plc annual report and form 20f 2006
88
07 discontinued operations continued
disposal of subsidiaries instinet group including btc
reuters held approximately 62 of the shares in instinet group a us based company which was previously accounted for as a subsidiary of reuters group plc on
a 100 consolidated basis with offsetting minority interest
on 31 march 2005 reuters sold btc a soft dollar execution broker to instinet group for approximately 38 million shares of instinet group stock valued at
approximately £12 million in 2004 an impairment loss of £17 million was recognised for btc within ‘profit for the year from discontinued operations’ the sale to
instinet group has been accounted for as a partial disposal of the group’s interest in btc which resulted in a loss of £3 million btc made profits after tax of
£1 million in the period prior to sale
on 8 december 2005 reuters disposed of its investment in instinet group for gross proceeds of £612 million including £37 million relating to reuters share of an
instinet group dividend received prior to close reuters recorded a net gain on sale of £191 million in 2005 within ‘profitloss on disposal of subsidiaries’ within
discontinued operations instinet group’s results up until sale a profit after tax of £68 million before minority interest are also included in the group results as part
of discontinued operations
the results of instinet group and btc are as follows
2006 2005 2004
£m £m £m
revenue – 466 551
operating costs – 402 517
operating profit – 64 34
finance income – 13 7
profit on disposal of availableforsale financial assets – 12 20
profit before tax – 89 61
taxation – 20 22
profit for the period – 69 39
the net cash flow attributable to discontinued operations is as follows
2006 2005 2004
£m £m £m
cash generated from discontinued operations see note 29 – 3 27
tax paid – 13 9
interest received – 13 9
interest paid – – 1
net cash flow from operating activities – 3 28
net cash flow from investing activities  – 474 28
net cash flow from financing activities – 85 129
exchange gainslosses on cash and cash equivalents – 57 30
decreaseincrease in cash and cash equivalents from discontinued operations – 499 99
 net cash flow from investing activities in 2005 includes £582 million relating to cash held by subsidiaries at the date of disposal
08 earnings per ordinary share
basic earnings per ordinary share is based on the results attributable to equity shareholders and on the weighted average number of ordinary shares in issue during
the year excluding ordinary shares purchased by reuters employee share ownership trusts and shares purchased as part of the ongoing buyback programme and
held as treasury shares
diluted earnings per share is calculated adjusting the weighted average number of ordinary shares used in the basic earnings per share calculation to assume
conversion of all dilutive potential ordinary shares resulting from outstanding share options
weighted average number in millions 2006 2005 2004
ordinary shares in issue 1455 1438 1434
nonvested shares held by employee share ownership trusts 30 32 34
shares repurchased 128 10 –
basic earnings per share denominator 1297 1396 1400
issuable under employee share schemes 24 41 36
diluted earnings per share denominator 1321 1437 1436
earnings per share from continuing and discontinued operations 2006 2005 2004
profit attributable to equity holders of the company £m 305 456 364
basic earnings per share 236p 326p 260p
diluted earnings per share 231p 317p 254p
notes to the financial statements continued reuters group plc annual report and form 20f 2006
earnings per share from continuing operations 2006 2005 2004
profit attributable to equity holders of the company £m 293 229 356
basic earnings per share 226p 163p 254p
diluted earnings per share 222p 159p 248p
09 remuneration of directors
section ‘directors’ remuneration for 2006’ within the remuneration report includes details of directors’ emoluments pension arrangements longterm incentive
plans and share option plans details of which form part of these financial statements
details of senior management remuneration are given in note 34 on pages 123–124
10 employee information
the average number of employees during the year was as follows
restated restated
2006 2005 2004
by business division
sales  trading 1062 491 305
research  asset management 800 658 699
enterprise 1241 925 296
media 189 109 64
shared divisional resources  3383 3605 3507
total divisions 6675 5788 4871
global sales  service organisation 5812 5438 5944
editorial 2321 2210 2220
corporate services 1494 1582 1780
total continuing operations 16302 15018 14815
discontinued operations – 846 1165
total average number of employees 16302 15864 15980
by geographical location
europe middle east  africa  7174 6962 7444
americas 4252 4292 4550
asia 4876 3764 2821
total continuing operations 16302 15018 14815
discontinued operations – 846 1165
total average number of employees 16302 15864 15980
by function
production and communications 9438 8498 8315
selling and marketing 4572 4179 3878
support services and administration 2292 2341 2622
total continuing operations 16302 15018 14815
discontinued operations – 846 1165
total average number of employees 16302 15864 15980
the above include
development staff 2670 2332 2282
2005 and 2004 have been restated to reflect the fact that content has been split into data and editorial with data now included within shared divisional resources
 following the integration of the product development function into the business divisions during 2006 related staff are now shown within the business divisions rather than within shared divisional
resources
 to reflect the way reuters was managed in 2006 uk  ireland emea west and emea east have been combined into one geographical location
the average number of employees during 2006 included 168 temporary staff 2005 181 2004 181
89 financials reuters group plc annual report and form 20f 2006
11 consolidated reconciliation of changes in equity
attributable to equity minority total
holders of the parent interest equity
share other retained
capital reserves earnings
note £m £m £m £m £m
1 january 2004 449 1717 1569 193 494
actuarial losses on defined benefit plans 25 – – 205 – 205
exchange differences taken directly to reserves – 34 – 14 48
exchange differences taken to the income statement on disposal of assets – 6 – – 6
tax on items taken directly to or transferred from equity – 10 45 – 35
net expense recognised directly in equity – 38 160 14 212
profit for the year – – 364 11 375
total recognised expenseincome for 2004 – 38 204 3 163
employee share schemes – – 28 4 32
tax on employee share schemes –– 9– 9
shares allotted during the year 27 6––– 6
proceeds from shares issued to minority shareholders of instinet – – – 4 4
dividends 32
final dividend for 2003 – – 86 – 86
interim dividend for 2004 – – 54 – 54
other movements in equity –– 1 1 2
31 december 2004 455 1755 1671 199 570
1 january 2005 455 1755 1671 199 570
transitional adjustment on firsttime adoption of ias 39  – 108 19 2 129
1 january 2005 as adjusted 455 1647 1690 201 699
actuarial losses on defined benefit plans 25 – – 48 – 48
exchange differences taken directly to reserves – 97 – 21 118
exchange differences taken to the income statement on disposal of assets – 2 – – 2
fair value losses on availableforsale financial assets 16 – 22 – 7 15
fair value gains on availableforsale financial assets taken to the income statement on 
disposal of assets 16 – 68 – 5 73
fair value losses on net investment hedges 16 – 39 – – 39
fair value gains taken to the income statement on disposal of net investment hedges 17 – 14 – – 14
tax on items taken directly to or transferred from equity – 4 10 – 14
net expense recognised directly in equity – 44 38 23 59
profit for the year – – 456 26 482
total recognised expenseincome for 2005 – 44 418 49 423
employee share schemes – – 42 7 49
tax on employee share schemes – – 11 – 11
repurchase of own shares – – 224 – 224
shares to be repurchased – – 59 – 59
shares allotted during the year 27 12 – 2 – 10
proceeds of shares issued to minority shareholders of instinet – – – 3 3
dividends 32
final dividend for 2004 – – 86 – 86
interim dividend for 2005 –– 54 – 54
share of instinet’s dividend paid to minority shareholders – – – 23 23
other movements in equity – 1 – – 1
minority interest in subsidiary disposed in the year – – – 237 237
31 december 2005 467 1692 1736 – 511
 the transitional adjustment on the balance sheet at 1 january 2005 primarily comprises recognition of the fair value of the group’s investments in savvis £45 million gain and tibco software inc tsi
£86 million gain offset by initial recognition of embedded derivatives £14 million loss plus £3 million tax credit
90 notes to the financial statements continued reuters group plc annual report and form 20f 2006
attributable to equity minority total
holders of the parent interest equity
share other retained
capital reserves earnings
note £m £m £m £m £m
1 january 2006 as previously stated 467 1692 1795 – 570
prior year adjustment – share buyback programme – – 59 – 59
1 january 2006 as restated 467 1692 1736 – 511
actuarial gains on defined benefit plans 25 – – 6 – 6
exchange differences taken directly to reserves – 95 – – 95
fair value gains on availableforsale financial assets 16 – 6 – – 6
fair value gains on net investment hedges 16 – 34 – – 34
tax on items taken directly to or transferred from equity – 3 1 – 4
net expense recognised directly in equity – 58 5 – 53
profit for the year – – 305 – 305
total recognised expenseincome for 2006 – 58 310 – 252
employee share schemes – – 30 – 30
tax on employee share schemes –– 1– 1
repurchase of own shares – – 467 – 467
shares to be repurchased – – 53 – 53
shares allotted during the year 27 41 – 9 – 32
shares cancelled during the year 27 12 12 – – –
dividends 32
final dividend for 2005 – – 81 – 81
interim dividend for 2006 – – 53 – 53
31 december 2006 496 1738 1414 – 172
2005 has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78
the impact of recognising these commitments is to increase current liabilities and to decrease shareholders’ equity at 31 december 2005 by £59 million
please refer to note 27 on page 116 and note 28 on page 117 for more information on the nature of and movements in share capital and other reserves
respectively
retained earnings is stated after deducting £1002 million 2005 restated £489 million 2004 £213 million in respect of treasury shares this is composed of
£750 million 2005 £224 million 2004 £nil which represents the cost of 187 million shares in reuters group plc 2005 57 million 2004 nil repurchased in the
market as part of the ongoing share buyback programme see note 27 on page 116 £53 million 2005 restated £59 million 2004 £nil which represents the cost of
120 million shares in reuters group plc 2005 135 million 2004 nil that reuters had an irrevocable commitment to repurchase during the year end close period
and £199 million 2005 £206 million 2004 £213 million which represents the cost of 30 million shares in reuters group plc 2005 32 million 2004 33 million
purchased in the market and held by reuters employee share ownership trusts esots to satisfy certain optionsawards under the group’s share incentive plans
see note 33 on page 120
during 2006 reuters cancelled 48 million shares repurchased as part of the ongoing share buyback programme an amount equal to the nominal value of these
shares has been transferred from share capital to the capital redemption reserve
91 financials reuters group plc annual report and form 20f 2006
12 segmental analysis – balance sheet
primary reportable segments
the tables below show assets liabilities and capital expenditure by business division the assets and liabilities are attributed to business divisions using
methodologies consistent with those used to allocate divisional results see note 1 on page 83
in 2006 reuters made changes to the allocation of revenue and operating costs between business divisions to reflect changes in the management of certain
products these changes had an insignificant impact on the balance sheet segmentation 2005 comparatives have been restated to reallocate £44 million of
intangibles arising on the acquisition of telerate from enterprise to sales  trading in line with the allocation of revenues from telerate products 2005 comparatives
have also been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78
31 december 2006
research 
sales  asset
trading management enterprise media shared total
£m £m £m £m £m £m
assets excluding investment in associates and joint ventures 743 249 186 48 656 1882
investment in associates and joint ventures 15 4 2 17 – 38
total assets 758 253 188 65 656 1920
total liabilities 441 108 117 52 1030 1748
capital expenditure 172 32 76 10 – 290
restated
31 december 2005
research 
sales  asset
trading management enterprise media shared total
£m £m £m £m £m £m
assets excluding investment in associates and joint ventures 705 253 139 43 961 2101
investment in associates and joint ventures 11 5 3 17 – 36
total assets 716 258 142 60 961 2137
total liabilities 506 128 146 70 776 1626
capital expenditure  241 53 38 14 – 346
31 december 2004
research 
sales  asset
trading management enterprise media instinet shared total
£m £m £m £m £m £m £m
assets excluding investment in associates and joint ventures 629 184 182 34 919 597 2545
investment in associates and joint ventures 9 5 3 18 – – 35
total assets 638 189 185 52 919 597 2580
total liabilities 511 120 151 66 397 765 2010
capital expenditure 71 20 28 6 19 – 144
 capital expenditure in 2005 excludes instinet group which was classified as a discontinued operation prior to its disposal
shared assets consist principally of taxation hedging derivatives shortterm deposits cash and borrowings as these are not managed separately by the divisions
capital expenditure includes additions of intangible assets and additions of property plant and equipment
secondary reportable segments
31 december 2006 31 december 2005 31 december 2004
total capital total capital total capital
assets expenditure assets expenditure assets expenditure
by geographical location £m £m £m £m £m £m
europe middle east  africa  616 124 589 191 763 73
americas 522 108 520 99 1102 56
asia 194 58 143 56 133 15
central 588 – 885 – 582 –
total 1920 290 2137 346 2580 144
 to reflect the way reuters was managed in 2006 uk  ireland emea west and emea east have been combined into one geographical location
central assets consist principally of investments in associates and joint ventures taxation hedging derivatives and centrally managed cash and shortterm deposits
92 notes to the financial statements continued reuters group plc annual report and form 20f 2006
93
13 intangible assets
internally
trade customer technology generated purchased
goodwill names relationships knowhow software software total
£m £m £m £m £m £m £m
cost
1 january 2004 243 30 – 153 21 53 500
exchange differences 14 2 – 9 – 2 27
additions
acquisition of subsidiaries 5 1 1 – – – 7
other additions –––– 23 3 26
disposals 19 – – – – – 19
adjustments  6 ––––– 6
31 december 2004 209 29 1 144 44 54 481
exchange differences 24 3 4 6 1 2 40
additions
acquisition of subsidiaries 103 4 59 4 – – 170
other additions –––– 29 11 40
reclassifications  9 3 – 65 – 3 80
31 december 2005 327 33 64 89 74 64 651
exchange differences 32 4 7 7 1 2 53
additions
acquisition of subsidiaries 18 1 11 16 – – 46
other additions –––– 93 21 114
adjustments  2––––– 2
31 december 2006 315 30 68 98 166 83 760
amortisation and impairment
1 january 2004 – 9 – 50 2 19 80
exchange differences ––– 4 – 1 5
charged in the year
amortisation – 2 – 20 2 11 35
impairment 18 – – – 34 3 55
31 december 2004 18 11 – 66 38 32 165
exchange differences – 2 – 3 – 2 7
charged in the year
amortisation – 3 4 15 3 10 35
impairment –––– 1 – 1
reclassifications  –3 – 38 – 3 44
31 december 2005 18 13 4 46 42 41 164
exchange differences –214 –2 9
charged in the year
amortisation – 4 7 13 10 12 46
31 december 2006 18 15 10 55 52 51 201
carrying amount
31 december 2004 191 18 1 78 6 22 316
31 december 2005 309 20 60 43 32 23 487
31 december 2006 297 15 58 43 114 32 559
 adjustments of £2 million to goodwill in 2006 relate to the finalisation of fair valuation adjustments in respect of the acquisition of telerate adjustments of £6 million to goodwill in 2004 relate to the
finalisation of earn out agreements in relation to the acquisition of avt technologies limited and capital access international llc and also to the finalisation of fair value adjustments in respect of
the acquisition of multex fair value adjustments are based on an independent valuation performed by professionallyqualified valuers
 reclassifications in 2005 relate to instinet group which was classified as a discontinued operation prior to its disposal
the carrying amount of intangibles other than goodwill internallygenerated software and purchased software at 31 december 2006 includes the following
balances which are considered to be material to the group’s financial statements
arising on acquisition of nature included in category date of acquisition carrying amount £m remaining amortisation period
telerate customer relationships june 2005 40 8 years 5 months
application networks technology knowhow june 2006 13 4 years 5 months
bridge trade names october 2001 12 4 years 9 months
bridge technology knowhow october 2001 11 4 years 9 months
financials reuters group plc annual report and form 20f 2006
94
key assumptions used in the value in use calculations are as follows
cash flow projections are derived from financial plans approved by the board
and cover a five year period they reflect management’s expectations of
revenue growth operating cost and margin for each cgu based on past
experience projections exclude the expected revenue and cost synergy benefits
arising from the various core plus growth strategies not yet underway cash
flows beyond the five year period have been extrapolated using estimated
terminal growth rates
a pretax discount rate of 9 to 11 2005 9 2004 9 reflecting the risks
relating to the cgus has been applied to cash flow projections for accounting
purposes impairment testing has been performed using perpetuity growth
rates ranging from 2 to 3 2005 0 to 3 2004 0 to 3 the rates used
have been determined with regard to projected growth for the specific markets
in which the cgus participate these rates are below the longterm average
growth rate for the businesses in which reuters operates
the forecasts are most sensitive to changes in projected revenue growth rates in
the first five years of the forecast period however there is significant headroom
and forecast revenues would have to be more than 14 lower than currently
projected before a possible impairment charge would be indicated
impairment of goodwill and intangibles 
during 2004
impairment losses in respect of goodwill in 2004 totalled £18 million £17 million
of which related to btc the soft dollar execution broker business in march
2005 reuters agreed to sell btc to instinet group in exchange for 38 million
shares of instinet group as a result reuters recognised a £17 million
impairment loss on goodwill relating to btc which formed its own cash
generating unit business had declined since the original purchase and future
business could be further impacted by changes in the external marketplace the
loss was calculated on the basis of fair value less selling costs as the value of
the business could be ascertained by the existence in 2004 of an armslength
sale and purchase agreement although instinet group was a group subsidiary
at the time of the sale reuters had already announced an intention to sell the
instinet group subject to regulatory approval the negotiations for the sale of
btc were therefore conducted on an armslength basis the impairment loss
was reported within the sales  trading division and reclassified to discontinued
operations in 2005
reuters also recorded a £37 million impairment on internally generated and
purchased software of which £30 million relates to the impairment of a new
order entry and billing system during 2004 management revised the
architectural solution to be simpler and more consistent with industry standards
leading to impairment of all of the previously capitalised expenditure
management considers this decision will lead to a more cost effective and
easier to execute solution in the longer term the impairment loss has been
allocated to the sales  trading 70 research  asset management 12
and enterprise 18 business divisions the balance relates to an impairment
recorded in respect of development costs capitalised in our internal effort to
build reuters knowledge for investment banking which was rationalised in
favour of the newly acquired multex platform and a write down in the value 
of capitalised software for instinet group which has been reclassified to
discontinued operations in 2005
13 intangible assets continued
impairment tests of goodwill
no impairment losses in respect of goodwill have been recognised in 2006 or 2005
for the purpose of performing impairment reviews reuters has identified seven cash generating units cgus in prior years reuters identified eight cgus but
disposed of btc in 2005 annual impairment reviews are performed as at 1 july for all cgus which include goodwill these reviews compare the carrying value 
of each cgu with the present value of future cash flows arising from the use of the assets of the unit value in use if the value in use is less than the carrying value
of the cgu an impairment loss is recognised immediately in the income statement
goodwill has been allocated directly to cgus the balances at 31 december 2005 have been restated to reallocate £25m of goodwill arising on the acquisition 
of telerate from enterprise to sales  trading in line with the allocation of revenues from telerate products
carrying amount of goodwill at
restated
31 december 2006 31 december 2005 31 december 2004
business division cash generating unit £m £m £m
sales  trading sales  trading 146 157 74
bridge trading company – – 8
research  asset management investment banking  investment management 93 103 74
wealth management – ––
lipper 28 31 22
enterprise enterprise excluding risk 3 44
risk 22 99
media media 5 5–
total 297 309 191
notes to the financial statements continued reuters group plc annual report and form 20f 2006
14 property plant and equipment
office
computer equipment
freehold leasehold systems and motor
property property equipment vehicles total
£m £m £m £m £m
cost
1 january 2004 241 214 1038 247 1740
exchange differences 6 12 34 10 62
additions 13269 9 111
disposals 83 47 215 53 398
31 december 2004 153 187 858 193 1391
exchange differences 1 8 36 4 49
additions 5418011 137
acquisitions –– 1 1 2
disposals – 8 91 15 114
reclassifications  1 62 41 36 140
31 december 2005 158 166 843 158 1325
exchange differences 5 10 57 10 82
additions 93775 9 130
disposals – 4 193 24 221
31 december 2006 162 189 668 133 1152
depreciation
1 january 2004 95 112 853 203 1263
exchange differences 6 3 32 5 46
charged in the year 8 11 95 16 130
disposals 27 27 208 48 310
31 december 2004 70 93 708 166 1037
exchange differences 1 3 29 3 36
charged in the year 4 13 73 13 103
disposals – 8 89 14 111
reclassifications  –313334 98
31 december 2005 75 70 688 134 967
exchange differences 2 4 47 9 62
charged in the year 4 15 67 9 95
disposals – 3 192 24 219
31 december 2006 77 78 516 110 781
carrying amount
31 december 2004 83 94 150 27 354
31 december 2005 83 96 155 24 358
31 december 2006 85 111 152 23 371
 reclassifications in 2005 relate to instinet group which was classified as a discontinued operation prior to its disposal other assets held for sale at the balance sheet date and depreciation capitalised
as intangible assets
the carrying amount of computer systems equipment includes an amount of £4 million 2005 £2 million 2004 £nil in respect of subscriber equipment being
sourced and managed by ibm on behalf of reuters this equipment has been classified as an asset held under finance lease the agreement for provision of
equipment and services by ibm includes a renewal clause and an option to purchase the equipment at fair market value
the carrying amount of property plant and equipment includes £16 million 2005 £nil 2004 £nil in respect of assets in the course of construction
the carrying amount of leasehold property is analysed as follows
2006 2005 2004
£m £m £m
longterm leaseholds 66 33 32
shortterm leaseholds 45 63 62
total leasehold property 111 96 94
95 financials reuters group plc annual report and form 20f 2006
96
15 investments accounted for using the equity method
interests
in joint interests in
ventures associates total
£m £m £m
net assetscost
1 january 2004 72 207 279
reclassifications  47 31 78
exchange differences 1 – 1
arising in year – share of
operating profits 58 13
taxation – 2 2
dividends received 3 1 4
loans repaid to joint ventures 5– 5
disposals – 176 176
shareholder taxes 2 – 2
31 december 2004 29 5 34
exchange differences 2– 2
arising in year – share of
operating profits 5– 5
interest receivable 1– 1
taxation 1 – 1
additions 1– 1
dividends received 4 – 4
disposals 1 – 1
impairments – 2 2
31 december 2005 32 3 35
reclassifications  14 – 14
exchange differences 3 1 4
arising in year – share of
operating profits –1 1
interest receivable 1– 1
taxation 2 – 2
additions 8– 8
dividends received 3 – 3
31 december 2006 19 3 22
goodwill
1 january 2004 –1 1
31 december 2004 –1 1
31 december 2005 –1 1
additions –15 15
31 december 2006 –1616
carrying amount
31 december 2004 29 6 35
31 december 2005 32 4 36
31 december 2006 19 19 38
 reclassifications in 2006 relate to the group’s investment in factiva which was classified as a noncurrent asset held for sale and sold during the year reclassifications in 2004 relate to the group’s
investment in radianz which was classified as a discontinued operation in 2004 and sold during 2005
the group holds a 51 interest in afe solutions limited a 38 interest in 3 times square associates llc and a 40 interest in independent research network
llc which are jointly controlled entities accounted for under the equity method of accounting
in july 2006 reuters and the chicago mercantile exchange cme formed a new joint venture fxmarketspace limited to create a centrallycleared global foreign
exchange trading system reuters invested £8 million in the joint venture during 2006
in october 2006 reuters acquired a 26 interest in times global broadcasting company limited for £11 million relating to the launch of a new indian tv news
channel times now in association with the times of india
in november 2006 reuters acquired a 17 interest in pluck corporation for £4 million this has been classified as an associate and accounted for under the equity
method of accounting because reuters has a seat on the board of directors and therefore has significant influence over pluck corporation
on 18 october 2006 reuters agreed to sell the majority of its investment in factiva to joint venture partner dow jones in accordance with ifrs 5 ‘noncurrent
assets held for sale and discontinued operations’ reuters reclassified its investment as a noncurrent asset held for sale on this date the sale was completed 
on 15 december 2006
notes to the financial statements continued reuters group plc annual report and form 20f 2006
share of posttax lossesprofits from associates and joint ventures is reconciled to the income statement as follows
2006 2005 2004
£m £m £m
operating profits 1 513
interest receivable 1 1–
taxation 2 1 2
setup costs of fxmarketspace 4 ––
share of posttax lossesprofits from associates and joint ventures 4 511
summarised financial information in respect of the group’s interests in its joint ventures at 31 december is as follows
2006 2005 2004
£m £m £m
income 63 83 80
expenses 64 78 75
lossprofit 1 55
noncurrent assets 61 76 66
current assets 18 37 37
current liabilities 49 20 19
noncurrent liabilities 11 61 55
carrying value 19 32 29
summarised financial information in respect of the group’s interests in its associates at 31 december is as follows
2006 2005 2004
£m £m £m
revenues 10 21 43
profit 1 –6
assets 48 19 17
liabilities 29 15 11
carrying value 19 46
16 other financial assets and liabilities
other financial assets and liabilities including derivative financial instruments are stated at fair value in 2005 and 2006 2004 comparatives have been presented
under uk gaap as noted in the accounting policies
other financial assets include the following
2006 2005 2004
£m £m £m
availableforsale financial assets
equity securities 17 13 47
other availableforsale financial assets 9 510
shortterm deposits 198 1 258
derivative financial instruments see note 17 33 21 –
total 257 40 315
less noncurrent portion 47 22 28
current portion 210 18 287
shortterm deposits are managed by the group’s treasury function as part of the group’s overall financing strategy movements in shortterm deposits are
therefore classified within ‘financing activities’ in the consolidated cash flow statement
97 financials reuters group plc annual report and form 20f 2006
98
16 other financial assets and liabilities continued
movements in the carrying value of availableforsale financial assets are analysed as follows
2006 2005 2004
£m £m £m
1 january 18 57 54
transitional adjustment on firsttime adoption of ias 39 – 101 –
1 january as adjusted 18 158 54
exchange differences – – 1
additions – 1–
fair value adjustments recognised in equity 6 50 –
reclassifications  4 23 31
disposals 2 68 27
31 december 26 18 57
 reclassifications in 2006 relate to a minority preference share interest in a factiva entity that reuters retained following the disposal of the majority of the group’s investment in factiva
reclassifications in 2005 include balances transferred to assets held for sale and liabilities associated with assets held for sale reclassifications in 2004 include balances transferred from investments 
in associates following reuters partdisposal of its stake in tsi
other financial liabilities include the following
2006 2005 2004
£m £m £m
borrowings
bank overdrafts 24 25 17
bank loans – –37
term notes and commercial paper 632 383 456
finance lease payables 4 2–
total borrowings 660 410 510
derivative financial instruments see note 17 27 10 –
total 687 420 510
less noncurrent portion 521 371 329
current portion 166 49 181
the term notes principally relate to a public bond of £337 million which is repayable in november 2010 and incurs interest at a fixed rate of 46 and a floating 
rate note of £169 million repayable in november 2008 and at 31 december 2006 incurs interest at 37 commercial paper of £122 million incurs interest at 49
all borrowings are unsecured
the maturity profile of finance lease payables is as follows
minimum lease present value of minimum lease 
payments payments
2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m
within one year 2 1– 2 1–
one to five years 2 1– 2 1–
greater than five years – –– – ––
4 2 –4 2–
the fair value of the group’s lease obligations approximates to their carrying amounts
fair value movements on other financial assets and liabilities recognised during 2006 and 2005 see note 17 include the following
2006 2005
fair value fair value
gainloss fair value gainloss fair value
in income gainloss in income gainloss
statement in equity statement in equity
£m £m £m £m
availableforsale financial assets –6 – 50
embedded derivatives in revenue contracts 24 – 21 –
embedded derivatives in supplier contracts 4– 2 –
hedging instruments
crosscurrency interest rate swaps – fair value hedges 3 – 1 –
crosscurrency interest rate swaps – net investment hedges 134 1 39
other derivatives
gains 1– ––
losses 1 – ––
other financial assets –– 16 –
total 22 40 1 89
notes to the financial statements continued reuters group plc annual report and form 20f 2006
17 derivatives and other financial
instruments
ias 32 ‘financial instruments presentation and disclosure’ and ias 39 ‘financial
instruments recognition and measurement’ were adopted by the group with
effect from 1 january 2005 financial information was prepared under uk gaap
for the financial period ended 31 december 2004 comparative information for
2004 is therefore shown separately after the 2005 and 2006 information below
management of financial risk
the group’s activities expose it to a variety of financial risks the main risks
managed by the group under policies approved by the board are foreign
currency risk interest rate risk liquidity risk counterparty credit risk and price
risk the group’s overall risk management programme focuses on the
unpredictability of financial markets and seeks to minimise potential adverse
effects on the group’s financial performance the board periodically reviews
reuters treasury activities policies and procedures all treasury activity takes
place within a formal control framework
details of values of financial assets and liabilities including derivative financial
instruments are shown on page 100
foreign currency risk
foreign exchange risks arise from cash flows relating to commercial transactions
recognised assets and liabilities and net investments in foreign operations
a substantial portion of reuters revenue is receivable in foreign currencies 
with terms of payments up to three months in advance reuters is exposed 
to currency risk from committed revenue for periods of up to two years
the conversion of net investments in foreign operations into the group’s
reporting currency of sterling creates translation exposure to mitigate this
effect to the extent that the group has core debt it is held in currencies
approximately proportionate to the currency profile of the group’s net assets
the currency of the debt may be altered by the use of currency swaps the
main currencies to which the group is exposed are the us dollar the swiss
franc and the euro
details of forward exchange contracts held for risk management purposes 
and an analysis of the sensitivity to rate changes of fair values of financial
instruments are shown on page 101
interest rate risk
the group’s interest rate risk arises from interestbearing assets and from
borrowings
investments and borrowings subject to variable rates expose the group to cash
flow interest rate risk which is the risk that future cash flows will fluctuate
because of changes in market interest rates investments and borrowings subject
to fixed rates expose the group to fair value interest rate risk as the fair value of
the financial instrument fluctuates because of changes in market interest rates
the group has no specific requirements on the exact proportion of interest that
should be fixed or floating the position is reviewed periodically on a currency
by currency basis various factors are considered in the review including forecast
core debt levels and prevailing market conditions based on this review the
group manages its cash flow and fair value interest rate risk by using interest
rate swaps under interest rate swaps the group agrees with other parties to
exchange at specified intervals mainly quarterly the difference between fixed
contract rates and floatingrate interest amounts calculated by reference to the
agreed notional principal amounts
an analysis by currency of interest rate swaps held for risk management
purposes is shown on page 101 details of the currency and interest rate profile
of the group’s financial assets and liabilities and the exposure of the group’s
borrowings to interest rate changes are shown on pages 103–104
liquidity risk
prudent liquidity risk management implies maintaining sufficient cash and
marketable securities the availability of funding through an adequate amount
of committed credit facilities and the ability to close out market positions
reuters manages its net debt position and interest costs to support its
continued access to the full range of debt capital markets
in october 2006 reuters entered into a committed multicurrency revolving
credit facility for £680 million this replaced an existing committed syndicated
credit facility of £480 million and a bilateral loan facility of £24 million at 
31 december 2006 reuters had available £623 million under the facility
following utilisation of £57 million in the form of a standby letter of credit
relating to an operating lease there were no cash drawings from the facility
during 2006 the commitment expires and any final repayment is due in
october 2011 unless oneyear extension options are exercised in october 2007
and october 2008 at the banks’ discretion in this instance the latest expiry
date would be 2013
in march 1998 reuters established a euro commercial paper programme this
provides access to £15 billion of uncommitted shortterm finance of which 
£14 billion was unused at 31 december 2006 £15 billion was unused at 
31 december 2005 £14 billion was unused at 31 december 2004 in december
1998 reuters established a £10 billion euro mediumterm note programme of
which £490 million was unused at 31 december 2006 £631 million was unused
at 31 december 2005 £613 million was unused at 31 december 2004
in addition at 31 december 2006 the group had unused shortterm
uncommitted bank borrowing facilities denominated in various currencies 
the sterling equivalent of which was approximately £117 million available at
money market rates
details of the timing of repayment of borrowings and other financial liabilities
are shown on page 104
counterparty credit risk
the group is exposed to concentrations of credit risk trade receivables are
concentrated in the financial community the group estimates that
approximately 65 of its subscribers are financial institutions 21 are
corporations in other sectors of the business community 11 are from the 
news media and 3 are government institutions and individuals worldwide
2005 72 14 9 and 5 2004 72 17 4 and 7
the maximum exposure to credit risk at 31 december 2006 was as follows
trade receivables £110 million amounts owed by associates and joint ventures
£6 million accrued income £38 million shortterm deposits £198 million 
cash and equivalents £129 million and derivative financial instruments 
£30 million 2005 £120 million £4 million £38 million £1 million £662 million
and £21 million 2004 £131 million £3 million £38 million £258 million 
£578 million and £64 million
the group invests with high credit quality financial institutions the group has
policies that limit the amount of credit exposure to any one financial institution
all derivative instruments are unsecured but the amount of this credit risk is
generally restricted to any fair value gain and not the principal amount hedged
however reuters does not anticipate nonperformance by the counterparties
who are all banks with recognised longterm credit ratings of ‘a3a’ or higher
credit risk may be managed by the use of credit default swaps and standby
letters of credit
price risk 
movements in equity security prices change the carrying value of availablefor
sale financial assets with changes being recorded in equity on adoption of 
ias 39 on 1 january 2005 reuters designated its investment in savvis
convertible preference shares as being held at fair value through profit or loss
with movements in the fair value being recognised within the income
statement the shares were pledged as part of the consideration for the
telerate acquisition in june 2005 and no further fair value movements were
recorded in the income statement after this point
the group does not have a material exposure to commodity price risk
99 financials reuters group plc annual report and form 20f 2006
17 derivatives and other financial instruments continued
financial assets and liabilities
carrying and fair values of group financial assets and liabilities at 31 december were
2006 2005
carrying carrying 
value fair value value fair value
£m £m £m £m
derivative financial instruments
crosscurrency interest rate swaps – fair value hedges  1 year –– 22
crosscurrency interest rate swaps – fair value hedges  1 year 9 9 12 12
embedded derivatives in revenue contracts 18 18 66
embedded derivatives in supplier contracts 33 1 1
crosscurrency interest rate swaps – net investment hedges 30 30 8 8
financial assets
availableforsale assets financial assets see note 16 26 26 18 18
trade receivables less provision for impairment see note 19 110 110 120 120
amounts owed by associates and joint ventures see note 19 66 44
other receivables see note 19 80 80 68 68
accrued income  38 38 38 38
shortterm deposits see note 16 198 198 11
cash and cash equivalents see note 20 129 129 662 662
financial liabilities
borrowings see note 16 660 660 410 410
trade payables see note 22 56 56 14 14
accruals  274 274 262 262
amounts owed to associates and joint ventures see note 22 1 1 11 11
other payables  87 87 95 95
other taxation and social security see note 22 33 33 35 35
other provisions for liabilities and charges  95 95 113 113
total 613 613 18 18
 prepayments and accrued income in note 19 £62 million include £24 million of prepayments that are not financial assets 2005 prepayments and accrued income in note 19 £78 million include 
£40 million of prepayments that are not financial assets
 accruals in note 22 £276 million include £2 million of nonfinancial liabilities 2005 accruals in note 22 £264 million include £2 million of nonfinancial liabilities
 other payables in note 22 £94 million include £2 million of progress payments on contracts and £5 million of subscriptions in advance which are nonfinancial liabilities 2005 other payables in
note 22 £107 million include £3 million of progress payments on contracts and £9 million of subscriptions in advance which are nonfinancial liabilities
 other provisions for liabilities and charges in note 24 £119 million includes £24 million of nonfinancial liabilities 2005 other provisions for liabilities and charges in note 24 £139 million includes
£26 million of nonfinancial liabilities
derivative financial instruments
derivative financial instruments held at 31 december were
2006 2005
gross gross
contract contract
amounts assets liabilities amounts assets liabilities
£m £m £m £m £m £m
maturing in less than one year
crosscurrency interest rate swaps – fair value hedges ––– 19 2 –
forward foreign exchange contracts – fair value hedges 27 – – –––
forward foreign exchange contracts – held for trading 242 – – 131 – –
embedded derivatives in revenue contracts 609 – 18 440 6 –
embedded derivatives in supplier contracts 41 3 – 26 – 1
919 3 18 616 8 1
maturing in greater than one year
cross currency interest rate swaps – net investment hedges 426 30 – 304 19
cross currency interest rate swaps – fair value hedges 506 – 7 337 12 –
interest rate swaps – fair value hedges 10 – 2 10 – –
942 30 9 651 13 9
total 1861 33 27 1267 21 10
gross contract amounts are calculated at historical exchange rates
during 2005 and 2006 certain derivative contracts were entered into for the purpose of managing foreign exchange risks associated with the group’s commercial
paper programme and its shortterm intercompany balances that did not meet the criteria to be accounted for as hedges and consequently are classified as
forward exchange contracts – held for trading
100 notes to the financial statements continued reuters group plc annual report and form 20f 2006
101
hedges of net investment in foreign entity
the group’s longterm borrowings undertaken in november 2003 and
november 2006 were swapped into us dollars and swiss francs by transacting
crosscurrency interest rate swaps and designated as a hedge of the net
investment in the group’s foreign subsidiaries the resulting debt of 694 million
2005 498 million is designated against the foreign investment in us
subsidiaries goodwill arising on acquisitions and certain intangible assets the
resulting swiss franc debt of 79 million swiss francs 2005 55 million swiss francs
is designated as a hedge of the foreign investment in reuters sa a further debt
of€15 million 2005€nil was designated against the foreign investment in
european subsidiaries
hedges of fair values
the fair value interest rate risk of the€500 million fixed rate bond issued 
by reuters finance plc was hedged by being swapped into euro floating 
rate interest
the foreign exchange risk arising from the retranslation of the€500 million fixed
rate bond issued by reuters finance plc and the€250 million floating rate
note issued by reuters group plc was hedged by being swapped into sterling
floating rate the foreign exchange risk arising from the retranslation and the
interest rate risk arising from the impact of changes in interest rates on the fair
values of foreign currency mediumterm notes amounting to £4 million and
maturing in 2008 were also swapped into floating rate sterling interest the
above hedges were executed in the form of crosscurrency interest rate swaps
the weighted average variable rate payable on all interest rate swaps used to
alter the currency and interest rate profile of debt issued at 31 december 2006
was 6 2005 5 the weighted average variable rate is based on the rate
implied in the yield curve at the balance sheet date
the following table provides an analysis by currency of interest rate swaps held for risk management purposes at 31 december
2006 2005
gross contract gross contract
amount amount
received paid £m £m
net investment hedges
sterling floating us dollar floating 382 280
sterling floating swiss franc floating 34 24
sterling floating euro floating 10 –
fair value hedges
japanese yen fixed sterling floating 5 5
euro fixed sterling floating 332 351
euro fixed sterling floating 10 10
euro floating sterling floating 169 –
total 942 670
interest is receivable under swap contracts at rates between 06 and 59 and is payable at rates between 20 and 60 interest rate swaps are due to mature 
at various dates between june 2008 and november 2010
the following table provides an analysis by currency of forward exchange contracts held for risk management purposes at 31 december
2006 2005
gross contract gross contract
amount amount
£m £m
sales
swiss franc 86 –
us dollar 60 22
thai baht 11 –
japanese yen 7 12
hong kong dollar 7 8
canadian dollar 6 7
swedish krona 5 –
australian dollar 1 8
euro – 14
purchases
euro 40 –
south african rand 24 23
singapore dollar 18 24
swiss franc – 9
other 4 4
total 269 131
composed of
forward foreign exchange contracts – fair value hedges 27 –
forward foreign exchange contracts – held for trading 242 131
total 269 131
foreign exchange forward contracts held at 31 december 2006 matured in january 2007
financials reuters group plc annual report and form 20f 2006
17 derivatives and other financial instruments continued
102
2006 2005
10 10 
1 weakening 1 weakening
increase in in other increase in in other
interest currencies interest currencies
fair value rates against £ fair value rates against £
£m £m £m £m £m £m
derivative financial instruments
currency and interest rate swaps 21 17 10 6 22 4
forward contracts –– 11 – – 1
embedded derivatives in revenue contracts 18 – 19 6 – 44
embedded derivatives in supplier contracts 3– 3 1 – 3
financial assets
availableforsale financial assets see note 16 26 – 2 18 – 2
trade receivables less provision for impairment see note 19 110 – 10 120 – 12
amounts owed by associates and joint ventures see note 19 6 – 1 4––
other receivables see note 19 80 – 6 68 – 4
accrued income  38 – 2 38 – 3
shortterm deposits see note 16 198 2 – 1––
cash and cash equivalents see note 20 129 – 9 662 – –
financial liabilities
borrowings see note 16 660 17 56 410 22 38
trade payables see note 22 56 – 3 14 – 1
accruals  274 – 17 262 – 16
amounts owed to associates and joint ventures see note 22 1 – – 11 – –
other payables  87 – 2 95 – 2
other taxation and social security see note 22 33 – 2 35 – 2
other provisions for liabilities and charges  95 – 6 113 – 9
total 613 2 41 18 – 9
 prepayments and accrued income in note 19 £62 million include £24 million of prepayments that are not financial assets 2005 prepayments and accrued income in note 19 £78 million include 
£40 million of prepayments that are not financial assets
 accruals in note 22 £276 million include £2 million of nonfinancial liabilities 2005 accruals in note 22 £264 million include £2 million of nonfinancial liabilities
 other payables in note 22 £94 million include £2 million of progress payments on contracts and £5 million of subscriptions in advance which are nonfinancial liabilities 2005 other payables in
note 22 £107 million include £3 million of progress payments on contracts and £9 million of subscriptions in advance which are nonfinancial liabilities
 other provisions for liabilities and charges in note 24 £119 million includes £24 million of nonfinancial liabilities 2005 other provisions for liabilities and charges in note 24 £139 million includes
£26 million of nonfinancial liabilities
embedded derivatives
forward exchange contracts implicitly contained in subscriptionbased revenue
commitments priced in currencies different from both the functional currency 
of the reuters entity and that of the customer are separated from their host
contracts and held on the balance sheet at fair value these revenue
commitments extend two years from the balance sheet date the majority of
embedded derivatives in sales contracts arise through us dollar pricing
forward exchange contracts implicitly contained in purchase commitments
priced in currencies different from both the functional currency of the reuters
entity and that of the supplier are also separated from their host contracts and
held on the balance sheet at fair value these purchase commitments expire at
various times between 2007 and 2010 the majority of embedded derivatives in
supplier contracts are us dollarpriced purchase commitments
financial instrument sensitivity analysis
the analysis below summarises the sensitivity of the fair value of the group’s
financial instruments to hypothetical changes in market rates fair values are the
present value of future cash flows based on market rates at the valuation date
the estimated adverse changes in the fair value of financial instruments are
based on an instantaneous
• 1 increase in the specific rate of interest from the levels effective at 
31 december 2006 with all other variables remaining constant and
• 10 weakening in the value of sterling against all other currencies from the
levels applicable at 31 december 2006 with all other variables remaining
constant
notes to the financial statements continued reuters group plc annual report and form 20f 2006
profile of financial assets and liabilities
the currency and interest rate profile of the group’s financial assets and liabilities after the impact of derivatives that are subject to interest rate risk at 
31 december was
2006
classes of financial assets and liabilities
term weighted
cash and notes and finance average
shortterm cash bank commercial lease interest
deposits equivalents overdrafts paper creditors total rate
£m £m £m £m £m £m 
by currency
sterling
floating – 41 1 88 – 48 5
fixed 197 – – 122 – 75 5
us dollar
floating – 32 15 378 – 361 6
fixed – – – – 4 4 6
euro
floating – 7 3 10 – 6 4
other
floating 1 49 5 34 – 11 3
total 198 129 24 632 4 333
by maturity
within one year 198 129 24 122 2 179
between one and two years – – – 173 2 175
between two and three years – – – – – –
between three and four years – – – 337 – 337
between four and five years – – – – – –
over five years ––––––
total 198 129 24 632 4 333
103 financials reuters group plc annual report and form 20f 2006
17 derivatives and other financial instruments continued
2005
classes of financial assets and liabilities
term weighted
cash and notes and finance average
shortterm cash bank commercial lease interest
deposits equivalents overdrafts paper creditors total rate
£m £m £m £m £m £m 
by currency
sterling
floating – 580 24 56 – 500 4
us dollar
floating – 19 – 291 – 272 5
fixed – – – – 2 2 6
euro
floating – 8 – 11 – 3 3
other
floating 1 55 1 25 – 30 3
total 1 662 25 383 2 253
by maturity
within one year 1 662 25 22 1 615
between one and two years – – – – 1 1
between two and three years – – – 5 – 5
between three and four years – – – – – –
between four and five years – – – 356 – 356
over five years ––––––
total 1 662 25 383 2 253
maturity of financial liabilities
financial liabilities excluding derivative financial instruments at 31 december are repayable as follows
2006 2005
other other
financial financial
borrowings liabilities borrowings liabilities
£m £m £m £m
within one year 148 507 48 473
between one and two years 175 19 130
between two and three years –7 58
between three and four years 337 5 –8
between four and five years –3 356 4
over five years –5 –7
total 660 546 410 530
the exposure of the group’s borrowings to interest rate changes and the contractual repricing dates are as follows
2006
6 months or less 6–12 months 1–5 years over 5 years total
£m £m £m £m £m
bank overdrafts 24 – – – 24
term notes and commercial paper 291 – 341 – 632
finance lease creditors 1 1 2 – 4
effect of interest rate swaps 341 – 341 – –
total 657 1 2 – 660
2005
6 months or less 6–12 months 1–5 years over 5 years total
£m £m £m £m £m
bank overdrafts 25 – – – 25
term notes and commercial paper 22 – 361 – 383
finance lease creditors 1 – 1 – 2
effect of interest rate swaps 361 – 361 – –
total 409 – 1 – 410
104 notes to the financial statements continued reuters group plc annual report and form 20f 2006
105
derivative financial instruments held at 31 december 2004 were
2004
gross 
contract 
amounts carrying value fair value
£m £m £m
foreign exchange forward contracts
contracts in profit 12411
contracts in loss 271 1 1
foreign currency options
contracts in profit –––
contracts in loss –––
currency and interest rate swaps
contracts in profit 373 54 64
contracts in loss 5––
total 773 54 64
the fair values of foreign currency and interest rate management instruments are estimated on the basis of market quotes discounted to current value using
marketquoted interest rates
an analysis by currency of derivative contracts held for currency hedging purposes at 31 december 2004 is set out below
2004
swaps forwards

euro 828
japanese yen 32
swiss franc 19 15
us dollar 70 37
other –18
total 100 100
foreign exchange forward contracts mature at dates up to february 2005 currency swaps and interest rate swaps both mature at various dates through to
november 2010
the results of currency and interest rate hedging activities for the year to december 2004 are as summarised below
2004
recognised gains £m
currency hedging 29
interest rate hedging 10
recognised currency hedging gains in 2004 were favourable mainly due to the effect of the weaker us dollar on hedges of the net investment in overseas
subsidiaries
derivatives and other financial instruments 
2004 uk gaap comparatives
the applicable accounting policies relevant to the 2004 comparatives prepared
under uk gaap are given on page 82
the following disclosure for derivatives and other financial instruments was
made in the 2004 annual report and form 20f prepared under uk gaap 
a substantial portion of the group’s revenue is receivable in foreign currencies
with terms of payment up to three months in advance as such the group is
subject to currency exposure from committed revenue and additionally to
interest rate risk from borrowing and the investment of cash balances the
group seeks to limit these risks by entering into a mix of derivative financial
instruments
if the derivative financial instruments were considered separately from the
underlying future revenue and interest the group would be subject to market
risk on these financial instruments from fluctuations in currency and interest rates
the group only enters into such derivative financial instruments to hedge or
reduce the underlying exposure described above there is therefore no net
market risk on such derivative financial instruments and only a credit risk from the
potential nonperformance by counterparties the amount of this credit risk is
generally restricted to any hedging gain and not the principal amount hedged
financials reuters group plc annual report and form 20f 2006
17 derivatives and other financial instruments continued
gains and losses on instruments used for hedging are not recognised until the exposure that is being hedged is itself recognised unrecognised gains and losses
on instruments used for hedging and the movements are set out below
2004
gain losses net
hedging £m £m £m
unrecognised at 1 january 2004 5 4 1
arising in previous years
recognised in 2004 4 2 2
not recognised in 2004 1 2 1
arising in 2004
not recognised in 2004 11 – 11
unrecognised at 31 december 2004 12 2 10
of which
expected to be recognised in 2005 1 1 –
expected to be recognised in 2006 or later 11 1 10
net unrecognised gains on derivatives used for hedging were £10 million at 31 december 2004
the weighted average variable rate payable on the interest rate swaps used to alter the currency and interest rate profile of debt issued at 31 december 2004 was 3
the weighted average variable rate is based on the rate implied in the yield curve at the balance sheet date
all derivative instruments are unsecured however reuters does not anticipate nonperformance by the counterparties who are all banks with recognised longterm
credit ratings of ‘a3a’ or higher
carrying and fair values of group financial assets and liabilities at 31 december were
2004
carrying value fair value
£m £m
derivative financial instruments 54 64
other financial assets
fixed asset investments 28 34
longterm debtors 20 20
investments held for resale 108 194
other shortterm deposits and cash 836 836
other financial liabilities
shortterm borrowings 181 181
longterm borrowings 329 329
other financial liabilities 97 97
the fair value of fixed asset investments and investments held for sale is the carrying value unless the investment has a readily determinable market value which is
higher
the fair value of listed shortterm deposits was based on quoted market prices for those investments the carrying amount of the other shortterm deposits and
investments approximated to their fair values due to the short maturity of the instruments held
the fair value of shortterm borrowings approximated to the carrying value due to the short maturity of the investments
shortterm debtors and creditors have been excluded from the above analysis and all other disclosures in this note other than the currency risk disclosures
financial instrument sensitivity analysis
the analysis below summarises the sensitivity of the fair value of the group’s financial instruments to hypothetical changes in market rates fair values are the
present value of future cash flows based on market rates at the valuation date
the estimated adverse changes in the fair value of financial instruments are based on an instantaneous
• 1 increase in the specific rate of interest from the levels effective at 31 december 2004 with all other variables remaining constant and
• 10 weakening in the value of sterling against all other currencies from the levels applicable at 31 december 2004 with all other variables remaining constant
106 notes to the financial statements continued reuters group plc annual report and form 20f 2006
fair value changes arising from
10 weakening
1 increase in in £ against 
interest rates other currencies 
fair value    adverse adverse
£m £m £m
currency and interest rate swaps 64 27 10
forward contracts – – 16
total 64 27 26
monetary assets and liabilities by currency after cross currency swaps excluding the functional currency of each operation at 31 december 2004 were
net foreign currency monetary assetsliabilities
japanese hong kong 
sterling us dollar euro swiss franc yen dollar other total
£m £m £m £m £m £m £m £m
functional currency of operation
sterling – 71 42 6 1 – 22 12
us dollar 15 – 21 16 – – 2 54
euro – 4 – – – – 1 3
swiss franc 23 2 3 – 1 – – 19
japanese yen 1 – – – – – – 1
hong kong dollar 1 18 – – 5 – – 24
other – 4 1 – – – – 3
total 36 51 23 22 5 – 21 60
exchange differences that arise as a consequence of trading transactions and the translation of monetary assets and liabilities are taken to the income statement 
in accordance with the group’s accounting policy exchange differences attributable to longterm foreign currency borrowings used to finance the group’s foreign
currency investments are taken directly to reserves consequently longterm foreign currency borrowings have been excluded from the above table
the currency and interest rate profile of the group’s financial assets at 31 december 2004 was
cash and shortterm deposits fixed rate investments
weighted weighted
average interest average time
noninterest floating rate fixed rate rate at for which rate
total bearing assets investments investments 31 december is fixed
£m £m £m £m  years
sterling 416 80 336 – – –
us dollar 469 58 411–––
euro 33 7 26–––
other 74 11 58 5 – 3
31 december 2004 992 156 831 5 – 3
interest on floating rate investments is earned at rates based on local money market rates floating rate investments include £370 million of money market deposits
which mature within three months of the balance sheet date
fixed rate investments are those investments which have an interest rate fixed for a period of greater than one year
the currency and interest rate profile of the group’s financial liabilities after allowing for interest rate and crosscurrency swaps at 31 december 2004 was
borrowings
other floating
financial rate
total liabilities borrowings
£m £m £m
sterling 280 60 220
us dollar 271 21 250
euro 25 13 12
swiss francs 27 2 25
other 413
31 december 2004 607 97 510
the floating rate borrowings comprise bank loans and overdrafts bearing interest at rates based on local money market rates commercial paper and mediumterm
notes the weighted average effective interest rate on borrowings at 31 december 2004 was 4 the above analysis excludes creditors falling due within one year
which are of a nonfinancial nature
107 financials reuters group plc annual report and form 20f 2006
17 derivatives and other financial instruments continued
total financial liabilities at 31 december 2004 are repayable as follows
other financial
borrowings liabilities
£m £m
within one year 181 32
between one and two years 19 19
between two and five years 518
over five years 305 28
total 510 97
in april 2003 reuters entered into a committed syndicated credit facility for £1 billion £520 million of the facility either expired or was voluntarily cancelled in 2004
at 31 december 2004 reuters had £480 million available under the facility the facility was undrawn during 2004 the commitment expires and final repayment is
due in april 2008
at the same time as the syndicated credit facility was arranged committed bilateral facilities of £90 million were also put in place on similar terms during 2004 
£66 million of the facilities either expired or were voluntarily cancelled at 31 december 2004 reuters had £24 million available all of which was undrawn no loans
were outstanding under this facility during 2004
in addition at 31 december 2004 the group had unused shortterm uncommitted bank borrowing facilities denominated in various currencies the sterling
equivalent of which was approximately £200 million at money market rates varying between 2 and 6 depending on the currency
18 inventories
2006 2005 2004
£m £m £m
work in progress on contracts 1 13
19 trade and other receivables
2006 2005 2004
£m £m £m
trade receivables 123 138 162
less provision for impairment 13 18 31
net trade receivables 110 120 131
instinet counterparty debtors – – 216
amounts owed by associates and joint ventures 6 43
other receivables 80 68 111
prepayments and accrued income 62 78 74
total trade and other receivables 258 270 535
the carrying value of trade and other receivables approximates to their fair value based on discounted cash flows using the group’s weighted average cost 
of capital
the recognition of provisions both in terms of timing and quantum requires the exercise of judgement based on the relevant circumstances which can be subject
to change over time if the final outcome on the judgement areas were to differ by 10 from management’s estimates the group would need to book an
adjustment of £1 million to operating costs and to trade receivables
concentration of credit risk faced by the group and other relevant risk factors are detailed in note 17 on page 99
108 notes to the financial statements continued reuters group plc annual report and form 20f 2006
109
20 cash and cash equivalents
2006 2005 2004
£m £m £m
cash
cash in hand and at bank 79 98 83
listed cash equivalents
government securities – overseas – –8
unlisted cash equivalents
term deposits – uk 2 12 84
term deposits – overseas 5 331
other investments – uk 37 546 –
other investments – overseas 6 3 372
cash and cash equivalents 129 662 578
the following cash balances are held by subsidiaries in countries where exchange control restrictions are in force such that cash is not freely transferable around
the group
2006 2005 2004
£m £m £m
brazil 1 22
china – 11
venezuela 3 21
total restricted cash 4 54
21 noncurrent assets and liabilities held for sale
the following are assets and liabilities classified as held for sale at 31 december
2006 2005 2004
£m £m £m
noncurrent assets classified as held for sale
property plant and equipment – 1–
assets of subsidiary held exclusively for resale  – – 145
total assets classified as held for sale – 1 145
liabilities directly associated with noncurrent assets classified as held for sale
liabilities of subsidiary held exclusively for resale  – – 47
total net assets classified as held for sale – 198
 2004 figures have been measured in accordance with ias 27 ‘consolidated and separate financial statements’ and not in accordance with ifrs 5 ‘noncurrent assets held for sale and discontinued
operations’
on 18 october 2006 the group classified its investment in factiva as a noncurrent asset held for sale the disposal of the majority of this investment was completed
on 15 december 2006 reuters retained a minority preference share interest in a factiva entity which has been reclassified as an availableforsale financial asset
in 2005 a property with a net book value of £1 million was classified as a noncurrent asset held for sale the sale of this property was completed in 2006
in 2004 radianz was classified as a subsidiary held exclusively for resale radianz’s net assets of £98 million were shown as held for sale radianz is reported within
the sales  trading division the acquisition and subsequent disposal of radianz is detailed in note 7 on page 87
22 trade and other payables
restated
2006 2005 2004
£m £m £m
trade payables 56 14 71
accruals 276 264 346
instinet counterparty creditors – – 197
deferred income 31 25 21
amounts owed to associates and joint ventures 1 11 12
other payables 94 107 39
other taxation and social security 33 35 35
total trade and other payables 491 456 721
2005 has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78 the
impact of recognising these commitments is to increase other payables at 31 december 2005 by £59 million
the carrying value of trade and other payables approximates to their fair value based on discounted cash flows using the group’s weighted average cost of capital
financials reuters group plc annual report and form 20f 2006
23 current tax liabilities
2006 2005 2004
£m £m £m
current tax liabilities 196 228 260
the group is subject to taxation in numerous jurisdictions significant judgement is required in determining the worldwide provision for taxation there are many
transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business the group recognises liabilities for
anticipated tax audit issues based on estimates of whether additional taxes will be due where the final tax outcome of these matters is different from the amounts
that were initially recorded such differences will affect the tax provisions in the period in which such determination is made
24 provisions for liabilities and charges
2006 2005 2004
£m £m £m
provisions for postemployment benefits see note 25 145 317 263
other provisions for liabilities and charges 119 139 164
total provisions 264 456 427
less noncurrent portion 204 392 340
current portion 60 64 87
the movement in other provisions for liabilities and charges during 2006 was as follows
legal other
rationalisation compliance property other total
£m £m £m £m £m
1 january 2006 110 7 5 17 139
exchange differences 2 – – 1 3
charged in the year 37 1 – 5 43
utilised in the year 47 1 2 5 55
released 4 – 1 1 6
unwinding of discounts 1 – – – 1
31 december 2006 95 7 2 15 119
110
the recognition of provisions both in terms of timing and quantum requires
the exercise of judgement based on the relevant circumstances which can be
subject to change over time
the largest provisions relate to restructuring programmes which cover primarily
leasehold properties and severances a number of leasehold properties have
been identified as surplus to requirements although efforts are being made to
sublet this vacant space management recognises that this may not be possible
immediately estimates have been made to cover the cost of vacant possession
together with any shortfall arising from subleased rental income being lower
than lease costs being borne by us a judgement has also been made in respect
of the discount factor based on a riskfree rate 4 to 5 which is applied to
the rent shortfalls for severance provisions the provision is only recognised
where employees have a valid expectation or have already been told of their
redundancy other provisions are held where the recoverability of amounts is
uncertain where the actual outcome may differ from the resulting estimates
additionally the group is subject to certain legal claims and actions see 
note 35 on page 124 provisions for specific claims or actions are only made
when the outcome is considered ‘probable’ that there will be a future outflow 
of funds including any associated legal costs the level of any provision is
inevitably an area of management judgement given the outcome of litigation is
difficult to predict there can be no assurance that there will not be an increase
in the scope of these legal matters or that any future lawsuits claims
proceedings or investigations will not be material
the majority of charges in 2006 relate to the core plus programme which 
was announced in july 2005 and includes headcount reduction data centre
rationalisation and development transformation these provisions will be
primarily utilised over the next three years
also included within rationalisation provisions at the end of 2006 are obligations
related to the fast forward programme which was first announced in 2003 
and the telerate integration programme which began in june 2005 both
programmes included headcount reduction and property rationalisation
severance related provisions will be utilised during 2007 and propertyrelated
provisions will be utilised over the remaining lease periods
legalcompliance provisions represent the expected cost of settling disputes
arising from contractual arrangements with thirdparty suppliers and individuals
and the expected cost of fulfilling indemnities given on the disposal of
subsidiaries
other property provisions reflect reuters contractual liability at the balance
sheet date to make good dilapidations under ongoing rental agreements
outside the rationalisation programmes and will be over the remaining 
lease periods
notes to the financial statements continued reuters group plc annual report and form 20f 2006
111
25 retirement benefits
the group has established various pension arrangements covering the majority of its employees in all plans except those which are internally funded the assets
are held separately from those of the group and are independently administered
defined contribution plans
reuters group operates 35 defined contribution plans covering approximately 57 of its employees of which the largest plans are the reuters retirement plan 
and the reuters 401k plans the percentage of total employees covered and the company contribution to these plans were
company contribution
 of employees  of basic salary
reuters retirement plan 164 110 
reuters 401k plans 244 60
 70 plus 40 through salary sacrifice arrangements
the group contributed £29 million to defined contribution plans in 2006 2005 £25 million 2004 £19 million and expects to contribute £30 million in 2007
defined benefit plans
the group also operates 28 defined benefit plans and post retirement medical
plans covering approximately 21 of employees all significant plans are valued
under ias 19 ‘employee benefits’ by independently qualified actuaries using the
projected unit credit method
the largest defined benefit plans are the reuters pension fund rpf and the
reuters supplementary pension scheme sps the total defined benefit
obligation for all significant plans at 31 december 2006 was £1417 million 2005
£1346 million 2004 £1158 million of which £1075 million 2005 £985 million
2004 £836 million related to the rpf and £158 million 2005 £162 million 2004
£141 million related to the sps the rpf is a complex hybrid pension fund
with both defined company and employee contributions and defined employee 
benefits the sps is a smaller defined benefit plan with benefits related to final
salary and length of service
both the rpf and the sps are set up under trust and as such are independent
of the company both trusts have a single corporate trustee with the directors 
of the corporate trustee operating as the managing committee of the pension
plan the rpf and the sps trustee companies both have directors appointed by
the members and directors plus the chairman appointed by the company no
senior company officers are directors of the corporate trustees both schemes
are prohibited from investing directly in the shares or debt of the company
except to the extent that these form part of pooled fund investments
movement on pension provisions and similar obligations
2006 2005 2004
£m £m £m
1 january 317 263 77
income statement see note 3
defined benefit plans  30 27 11
postretirement medical benefits – 3 2
actuarial gains and losses taken directly to reserves
defined benefit plans  8 46 206
postretirement medical benefits 2 2 1
exchange differences
defined benefit plans  1 ––
postretirement medical benefits 1 ––
339 341 291
contributions paid 208 24 28
schemes in surplus recognised within noncurrent assets 14 ––
31 december 145 317 263
composed of
defined benefit plans  129 302 252
postretirement medical benefits 9 8 4
other 7 7 7
31 december 145 317 263
 the figures for defined benefit plans include a number of immaterial schemes which have not been valued under ias 19
financials reuters group plc annual report and form 20f 2006
25 retirement benefits continued
amounts recognised in respect of material defined benefit plans
the following disclosures only refer to the group’s material defined benefit plans
defined benefit assetsliabilities recognised in the balance sheet
post retirement 
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m £m £m £m £m £m £m
present value of funded obligations 1233 1148 977 157 167 151 – –– 1390 1315 1128
fair value of plan assets 1158 902 781 140 139 124 – –– 1298 1041 905
75 246 196 17 28 27 – –– 92 274 223
present value of unfunded obligations 15 19 18 3 4 9 9 8 3 27 31 30
90 265 214 20 32 36 9 8 3 119 305 253
plan asset not recognised in the balance sheet – –– 3 3 – – –– 3 3 –
ias 19 deficit recognised in the balance sheet 102 265 214 25 35 36 9 8 3 136 308 253
ias 19 surplus recognised in the balance sheet 12 –– 2 –– – –– 14 ––
fair value of reimbursement rights not recognised as 
pension plan assets – –– 4 43 – –– 4 43
the assets and obligations reported under uk plans include the rpf the sps and a number of smaller unfunded early retirement ill health and retirement benefit
schemes
the reimbursement rights reported under overseas plans relate to insurance policies held by reuters in respect of a plan in germany which do not meet the
definition of plan assets under ias 19 these are recognised in noncurrent assets
amounts recognised in the income statement
post retirement 
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m £m £m £m £m £m £m
current service cost 23 19 20 10 11 10 – –– 33 30 30
interest cost 55 52 41 5 56 – –– 60 57 47
expected gain on plan assets 61 51 52 6 7 6 – –– 67 58 58
past service cost 6 1– – –– – 2– 6 3–
gains on curtailments 3 2 3 – 3 – – –– 3 5 3
gains on settlements – 1 – – –– – –– – 1 –
total recognised in the income statement 20 18 6 9 610 – 2– 29 26 16
included within
operating profit 22 20 6 9 610 – 2– 31 28 16
profit on disposal of associates joint ventures and 
availableforsale financial assets 2 –– – –– – –– 2 ––
profit for the year from discontinued operations – 2 – – –– – –– – 2 –
total recognised in the income statement 20 18 6 9 610 – 2– 29 26 16
actual return on plan assets 92 146 76 10 18 5 – –– 102 164 81
further amounts recognised in the statement of recognised income and expense
post retirement 
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m £m £m £m £m £m £m
actuarial lossesgains 5 46 195 13 3 10 2 2– 6 45 205
effect of asset ceiling – –– – 3– – –– – 3–
5 46 195 13 –10 2 2– 6 48 205
deferred tax impact of actuarial gains and losses 
recognised in the statement of recognised income 
and expense 1 10 43 3 – 2 1 –– 1 10 45
total recognised in the statement of recognised income 
and expense 4 36 152 10 –8 1 2– 5 38 160
112 notes to the financial statements continued reuters group plc annual report and form 20f 2006
113
cumulative amounts recognised in the statement of recognised income and expense
post retirement 
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m £m £m £m £m £m £m
balance of actuarial losses at 1 january 241 195 – 7 10 – 2 –– 250 205 –
net actuarial lossesgains recognised in year 5 46 195 13 3 10 2 2– 6 45 205
balance of actuarial lossesgains at 31 december 246 241 195 6 710 4 2– 244 250 205
balance of asset limit effects at 1 january – –– 3 –– – –– 3 ––
effects of the asset ceiling in the year – –– – 3– – –– – 3–
balance of asset limit effects at 31 december – –– 3 3– – –– 3 3–
changes in the present value of the defined benefit obligation
post retirement 
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m £m £m £m £m £m £m
opening defined benefit obligation 1167 995 743 171 160 141 8 3 4 1346 1158 888
current service cost 23 19 20 10 11 10 – –– 33 30 30
past service cost 6 1 – – –– – 2 – 6 3 –
interest cost 55 52 41 5 5 6 – –– 60 57 47
gains on curtailments 3 23 – 3– – –– 3 53
liabilities extinguished on settlements – 8– 1 –– – –– 1 8–
actuarial gainslosses 36 141 219 9 8 9 2 2 – 29 151 228
contributions by employees 1 3 6 4 4 5 – –– 5 7 11
benefits paid 37 34 31 8 14 9 – –1 45 48 41
exchange differences on overseas plans – –– 12 –2 1 1 – 13 1 2
closing defined benefit obligation 1248 1167 995 160 171 160 9 8 3 1417 1346 1158
changes in the fair value of plan assets
post retirement
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
£m £m £m £m £m £m £m £m £m £m £m £m
opening fair value of plan assets 902 781 716 139 124 116 – –– 1041 905 832
expected return 61 51 52 6 76 – –– 67 58 58
assets transferred on settlements – 7 – 1 –– – –– 1 7 –
actuarial gainslosses 31 95 24 4 11 1 – –– 35 106 23
contributions by employer 200 13 14 7 69 – –1 207 19 24
contributions by employees 1 3 6 4 4 5 – – – 5 7 11
benefits paid 37 34 31 8 14 9 – – 1 45 48 41
exchange differences on overseas plans – –– 11 1 2 – –– 11 1 2
closing fair value of plan assets 1158 902 781 140 139 124 – –– 1298 1041 905
the weighted average duration of the scheme obligations were 25 years and 15 years for the rpf and the sps respectively
following discussions with the trustees of the rpf and the sps £181 million was contributed towards funding the deficit in the plans in 2006 with a further 
£40 million due to the rpf in 2007 and payments of £15 million per year due to the sps in each of the years from 2007 until 2010 a further special contribution of
£6 million was made to the sps in respect of some previously unfunded arrangements in addition to these special contributions employer’ s contribution rates have
been agreed at between 190 and 258 of pensionable salary including 6 and 9 respectively through salary sacrifice arrangements from 1 april 2007 for rpf
members and 342 for sps members including 6 through salary sacrifice arrangements
the group expects to contribute £68 million to its defined benefit schemes in 2007 including the special contributions referred to above
major categories of plan assets as a percentage of total plan assets
post retirement 
uk plans overseas plans medical benefits total
2006 2005 2004 2006 2005 2004 2006 2005 2004 2006 2005 2004
       
equities 44 55 55 45 46 49 – –– 44 54 54
bonds 45 36 37 47 45 38 – –– 45 37 37
property 7 77 – –– – –– 6 66
cash 1 21 4 54 – –– 2 22
other 3 –– 4 49 – –– 3 11
the trustees of the rpf and the sps have responsibility for the operation of the funds including strategic decision making on investment matters a statement of
investment principles has been made by the trustees of the schemes
the strategic asset allocation of the funds is driven by the financial characteristics of the funds in particular the funds’ liabilities and the risk tolerance of the
trustees in setting the investment policy the trustees of the rpf and the sps sought the views of the company
financials reuters group plc annual report and form 20f 2006
25 retirement benefits continued
principal actuarial assumptions at the balance sheet date expressed as a weighted average
post retirement 
uk plans overseas plans medical benefits
2006 2005 2004 2006 2005 2004 2006 2005 2004
     
discount rate 493 475 525 349 329 355 600 550 575
inflation assumption 300 275 275 157 147 144 – ––
rate of increase in salaries 425 400 400 261 239 253 – ––
rate of increase in pensions in payment 300 275 275 138 138 142 – ––
medical cost trend – –– – –– 500 550 550
expected rate of return on reimbursement rights 510 –– 475 425 – – ––
expected rate of return on assets
equities 810 800 825 642 710 712 – ––
bonds 449 400 440 314 292 304 – ––
property 620 600 650 – –– – ––
cash 425 400 400 228 244 218 – ––
other 425 –– 605 547 495 – ––
for the rpf and the sps the two largest schemes a 025 increase in the discount rate would result in a £61 million decrease in the defined benefit obligation at
the balance sheet date a 025 decrease in the discount rate would result in a £66 million increase in the defined benefit obligation at the balance sheet date the
effects of such a change are partially hedged by the schemes’ asset portfolios
the expected return on plan assets reflects the investments currently held to provide for the pension benefit obligations as at the balance sheet date plan assets
primarily consist of equity instruments and fixed income investments the expected rate of return on equities was based on expected market conditions in each of
the territories in which plans operate the expected return on assets is stated net of investment expenses the expected return on assets for the uk plans at
31 december 2005 and 31 december 2006 is stated gross of the expected levy to the uk pension protection fund
uk mortality assumptions
the mortality assumptions used to assess the defined benefit obligation for the rpf and the sps the largest plans at 31 december 2006 31 december 2005 and
31 december 2004 are based on the 92 series tables issued by the continuous mortality investigation bureau with allowance for projected longevity improvements
to calendar year 2025 and adjustment for the short cohort effect 
the following table illustrates the expectation of life of an average member reaching age 65 at the balance sheet date and member reaching 65 at the same
date plus 25 years
life expectation in years
male female
retiring at reporting date at age 65 21 24
retiring at reporting date 25 years at age 65 22 24
for the rpf and the sps an increase in life expectancy of 1 year across all age groups would result in a £62 million increase in the defined benefit obligation
history of experience gains and losses
2006 2005 2004
post post post
retirement retirement retirement
uk overseas medical uk overseas medical uk overseas medical
plans plans benefits total plans plans benefits total plans plans benefits total
£m £m £m £m £m £m £m £m £m £m £m £m
defined benefit obligation 1248 160 9 1417 1167 171 8 1346 995 160 3 1158
plan assets 1158 140 – 1298 902 139 – 1041 781 124 – 905
deficit 90 20 9 119 265 32 8 305 214 36 3 253
experience adjustments on plan liabilities 14 3 3 14 16 6 1 11 100 5 1 94
experience adjustments on plan assets 31 4 – 35 95 11 – 106 24 1 – 23
114 notes to the financial statements continued reuters group plc annual report and form 20f 2006
26 deferred tax
the movement on the deferred tax account is as shown below
2006 2005 2004
£m £m £m
1 january 210 247 219
acquisitionsdisposals 11 46 –
income statement charge 18 19 23
deferred tax chargecredit on pension revaluations recognised in equity 1 10 45
deferred tax on stock options recognised in equity 1 10 8
exchange differences 10 8 2
31 december 171 210 247
deferred tax assets have been recognised in respect of tax losses and other temporary differences giving rise to deferred tax assets only to the extent that it is
probable that sufficient taxable profits will be available to allow the asset to be recovered accordingly no deferred tax asset has been recognised in respect of
unused tax losses of £101 million carried forward at the balance sheet date the deferred tax asset not recognised in respect of these losses is £39 million
deferred tax assets of £184 million have been recognised in respect of tax losses and other deductible temporary differences arising in certain jurisdictions where
losses were incurred in the current or preceding period recognition of these assets is based on all relevant factors including their expected recovery measured
using group profit forecasts
no deferred tax is recognised on the unremitted earnings of overseas subsidiaries and joint ventures as the group is able to control the timing of the reversal of the
temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future if the earnings were remitted tax of £991 million
would be payable
the movements of deferred tax assets and liabilities are shown below
deferred tax liabilities
property
plant and
equipment other total
£m £m £m
1 january 2006 12 54 66
acquisitions – 11 11
charged to income statement – 33 33
31 december 2006 12 98 110
deferred tax assets
property
plant and stock
equipment losses options other total
£m £m £m £m £m
1 january 2006 40 88 22 126 276
creditedcharged to income statement 24 16 1 26 15
recognised in equity – – 1 1 –
realisation of stock option deductions – 7 7 – –
exchange differences 2 – – 8 10
31 december 2006 62 111 17 91 281
the deferred tax asset expected to be recovered after more than one year is £183 million 2005 £135 million 2004 £186 million
115 financials reuters group plc annual report and form 20f 2006
116
27 share capital
movements in share capital during the year ended 31 december were as below
called up share share
share capital premium capital
£m £m £m
1 january 2004 358 91 449
shares allotted during the year 15 6
31 december 2004 359 96 455
shares allotted during the year 111 12
31 december 2005 360 107 467
shares allotted during the year 734 41
shares cancelled during the year 12 – 12
31 december 2006 355 141 496
an analysis of called up share capital is set out below
2006 2005 2004
£m £m £m
authorised
one founders share of £1 – ––
2100 million ordinary shares of 25p each 525 525 525
525 525 525
allotted called up and fully paid
one founders share of £1 – ––
ordinary shares of 25p each 355 360 359
355 360 359
number of ordinary shares of 25p each millions 1422 1441 1436
shares allotted during the year in millions
28876537 shares in reuters group plc were issued under employee share schemes at prices 
ranging from £nil to 419p per share transaction costs incurred on issue of shares amounted 
to £nil 2005 £nil 2004 £nil 29 63
during 2006 reuters cancelled 48 million shares repurchased as part of the ongoing share buyback programme
called up share capital includes £1 million for shares granted to employees on exercise of share optionsawards in respect of which no cash had been received 
at the balance sheet date 2005 £1 million 2004 £1 million
the rights attaching to the founders share are set out on pages 147–148
the following table provides a summary of the shares repurchased under the buyback programme from its announcement in july 2005 until december 2006
total number approximate
of shares value of shares
purchased as that may 
part of publicly average price be purchased
announced paid per under the
month programme share £ programme £m
2005
july 1500000 389 994
august 8500000 370 962
september 7150000 373 936
october 2800000 353 926
november 22800000 389 836
december 14650000 408 776
2006
january 10500000 432 731
february 18450000 406 655
march 13725000 389 601
april 6000000 398 577
may 9435000 386 541
june 17750000 367 475
july 6770000 375 450
august 13000000 389 399
september 9750000 411 358
october 8725000 443 319
november 9500000 457 276
december 5594000 455 250
the current £1 billion share buyback programme was announced on 26 july 2005 and was due to run for two years based on current investment plans reuters
expects to increase the buyback during 2007 to £400–£425 million which includes £250 million remaining of the £1 billion buyback no programme has expired
during the period covered by the table reuters has not determined to terminate any programme prior to expiration
notes to the financial statements continued reuters group plc annual report and form 20f 2006
28 other reserves
an analysis of the movement in other reserves is set out below
capital available total
redemption other forsale hedging translation other
reserve reserve reserve reserve reserve reserves
£m £m £m £m £m £m
1 january 2004 1 1718 – – – 1717
exchange differences taken directly to reserves – – – – 34 34
exchange differences taken to the income statement on disposal of assets – – – – 6 6
tax on items taken directly to or transferred from reserves – – – – 10 10
31 december 2004 1 1718 – – 38 1755
transitional adjustment on firsttime adoption of ias 39  – – 94 30 16 108
exchange differences taken directly to reserves – – – – 97 97
exchange differences taken to the income statement on disposal of assets – – – – 2 2
fair value losses on availableforsale financial assets – – 22 – – 22
fair value gains on availableforsale financial assets taken to the income statement on 
disposal of assets – – 68 – – 68
fair value losses on net investment hedges – – – 39 – 39
fair value gains taken to the income statement on disposal of net investment hedges – – – 14 – 14
other movements – 1 – – – 1
tax on items taken directly to or transferred from reserves – – – 16 12 4
31 december 2005 1 1719 4 7 29 1692
exchange differences taken directly to reserves – – – – 95 95
fair value gains on availableforsale financial assets – – 6 – – 6
fair value gains on net investment hedges – – – 34 – 34
shares cancelled during the year 12 – – – – 12
tax on items taken directly to or transferred from reserves – – – 10 7 3
31 december 2006 13 1719 10 17 59 1738
 the transitional adjustment on firsttime adoption of ias 39 primarily comprises recognition of the fair value of the group’s investment in tsi £86 million gain
in 1998 a court approved capital reorganisation took place in exchange for every 15 ordinary shares in reuters holdings plc shareholders received prorata 
13 ordinary shares in reuters group plc plus £1360 in cash the difference between the proforma nominal value of shares in issue of reuters group plc
immediately prior to the reorganisation and the previously reported capital and reserves of reuters holdings plc excluding retained earnings represents the
merger difference which has since been recorded in the other reserve
the capital redemption reserve is used to record an amount equal to the nominal value of treasury shares that have been cancelled
the availableforsale reserve is used to record the cumulative fair value gains and losses on availableforsale financial assets the cumulative gain or loss is
recognised in the income statement on disposal of the asset
the hedging reserve is used to record the cumulative gains and losses on hedges of the group’s net investment in foreign operations providing that the hedges
were effective the cumulative gain or loss is recognised in the income statement on disposal of the foreign operation
the translation reserve is used to record cumulative exchange differences on the assets and liabilities of foreign operations the cumulative exchange difference
is recognised in the income statement on disposal of the foreign operation
117 financials reuters group plc annual report and form 20f 2006
29 net cash flow from operating activities
profit for the year is reconciled to cash generated from operations as follows
2006 2005 2004
£m £m £m
profit for the year from continuing operations 293 229 356
adjustments for
depreciation 95 99 112
impairment of associates and joint ventures – 2–
impairment of intangibles – 135
amortisation of intangibles 46 33 28
profitloss on disposal of property plant and equipment 2 –1
employee share scheme charges 30 30 22
foreign exchange gainslosses 14 8 9
fair value movements on derivatives 19 18 –
fair value movements on other financial assets – 16 –
profits on disposals 80 42 207
income from investments – 1 –
share of posttax lossesprofits of associates and joint ventures 4 5 11
finance income 72 41 15
finance costs 87 53 27
taxation 20 940
movements in working capital
decreaseincrease in inventories – 2 1
decrease in trade and other receivables 23 32
increasedecrease in trade and other payables 51 52 98
increasedecrease in pensions deficit 176 9 17
decreaseincrease in provisions 13 27 16
decreaseincrease in amounts payable to discontinued operations – 24 8
cash generated from continuing operations 311 268 307
profit for the year from discontinued operations 12 253 19
adjustments for
profits after tax of subsidiaries acquired with a view to resale – – 1
depreciation – 418
impairment of intangibles – –23
amortisation of intangibles – 27
loss on disposal of property plant and equipment – 42
employee share scheme charges – 18 11
profits on disposals 12 278 19
income from investments – – 1
finance income – 13 7
taxation – 20 22
movements in working capital
increasedecrease in trade and other receivables – 28 146
decrease in trade and other payables – 17 212
decrease in pensions deficit – – 2
increasedecrease in provisions – 14 25
decreaseincrease in amounts receivable from continuing operations – 24 8
cash generated from discontinued operations – 3 27
cash generated from operations 311 271 280
118 notes to the financial statements continued reuters group plc annual report and form 20f 2006
30 cash flow from acquisitions and disposals
2006 2005 2004
£m £m £m
acquisitions including joint ventures and associates
subsidiary undertakings see note 36 32 135 66
joint ventures and associates 27 1 –
loans repaid to joint ventures and associates – – 5
deferred payments for acquisitions in prior years 9 8 8
68 144 79
less cash acquired 1 20 1
acquisitions net of cash acquired 67 124 78
disposals including joint ventures and associates
subsidiary undertakings  15 824 70
joint ventures and associates 80 1 379
instinet deemed disposal – 35
65 828 454
add cash disposed – 582 16
disposals net of cash disposed 65 246 438
 the cash outflow of £15 million for subsidiary undertakings in 2006 principally represents transaction fees on the disposal of instinet group which was completed in december 2005
31 reconciliation of cash and cash equivalents
cash and cash equivalents included in the cash flow statement comprise the following balance sheet amounts
2006 2005 2004
£m £m £m
cash and cash equivalents see note 20 129 662 578
bank overdrafts 24 25 17
total cash and cash equivalents 105 637 561
32 dividends
2006 2005 2004
£m £m £m
prior year final paid 81 86 86
current year interim paid 53 54 54
134 140 140
per ordinary share pence pence pence
prior year final paid 615 615 615
current year interim paid 410 385 385
a final dividend in respect of 2006 of 690p per ordinary share amounting to a total dividend of £86 million is to be proposed at the agm on 26 april 2007 
these financial statements do not reflect this proposed dividend payable
at 31 december 2006 304 million shares representing 21 of reuters group plc’s shares were held by reuters employee share ownership trusts in respect 
of which dividend rights have been waived until the group receives written confirmation of cancellation from computershare trustees ci limited
119 financials reuters group plc annual report and form 20f 2006
33 employee share plans
the group operates a number of share incentive plans for the benefit of
employees the nature of each plan including general terms and conditions
and the methods of settlement is set out below
longterm incentive plan ltip since 1993 reuters has operated an ltip that
seeks to encourage and reward longterm growth in shareholder value it is
reuters practice to make an annual award of contingent share rights to
executive directors and to those senior managers most able to influence
corporate performance
for awards prior to 2006 performance is assessed by reference to the
company’s relative total shareholder return tsr measured against the ftse
100 over the performance period and awards vest and are released after three
years subject to the performance conditions attached for awards made prior
to 2004 that do not vest or only partially vest after three years the plan permits
the measurement period to be extended by up to two years under a retesting
provision for awards made from 2004 onwards the retesting provision does
not apply
50 of the 2006 awards had tsr performance conditions attached however
the remaining 50 have performance conditions based on adjusted pbt
targets these targets are explained in the remuneration report on page 30
from 2003 charges for these awards have been based on the fair market value
per share using option pricing methodology the fair market value ascribed to
each tsr ltip award in 2006 was 559 of the market value at the date of grant
the fair market value ascribed to each pbt ltip award in 2006 was 939
all of the ltip awards are settled in equity
discretionary share option plan dsop the global dsop was adopted by the
remuneration committee in october 2000 and approved by shareholders in
april 2001 it aims to reward growth in earnings and in the share price the
options were normally granted with a four year vesting period shares vesting
25 each year
with effect from 2004 to reduce the dilutive impact dsops have on
shareholders’ interests and to allow the introduction of a plan better targeted at
the general employee population the number of participants was reduced
significantly participation will normally be confined to executive directors and
members of the glt  prior to 2006 the gmc other employees may be
eligible to participate in the restricted share plan see below
performance conditions apply to those options granted to executive directors
for awards granted from 2001 to 2004 the remuneration committee could
approve the retesting of performance up to twice in the event the performance
condition was not met by extending the performance period by up to two years
with an increase of 3 in the hurdle rate of eps growth as calculated under uk
gaap for each year added to the performance period if the target rate was not
met by the end of the fifth year the options would lapse
for awards granted from 2004 the retesting provisions have been removed
and accordingly new awards will not permit any extension of the measurement
period if the awards do not meet the eps performance condition upon
completion of the initial performance period they will lapse
for awards granted in 2005 and prior years full vesting is achieved if adjusted
eps growth exceeds the percentage growth in the retail price index rpi by 9
over the three year performance period for awards granted in 2006 50 of the
awards vest if adjusted eps growth exceeds rpi growth by 6 over three years
with 9 growth required for full vesting and awards vesting proportionally for
growth of between 6 and 9 of those options which vest under the 2006
plan only 50 can be exercised immediately a further 25 can be exercised
after one year and another 25 can be exercised after two years
all options are subject to a maximum ten year life and are typically settled 
in equity
saveasyouearn saye plan an allemployee international savingsrelated
share option plan is offered in which the executive directors are eligible to
participate participants save a fixed monthly amount of up to £250 subject to a
maximum established annually for each offer for three years and are then able
to use their savings to buy shares at a price set at a 20 discount to the market
value at the start of the savings period in line with market practice no
performance conditions are attached to options granted under this plan
options are subject to a maximum life of three years and six months and are
settled in equity
annual bonus profit sharing plan abpsp in december 2003 reuters
announced its intention to introduce a new profit sharing plan across the 
allemployee population this plan was introduced to focus employees on
reward for profit growth in 2006 this plan was operated as a cashonly plan 
and no shares will be issued to employees executive directors and members of
the glt did not participate in this plan in 2006 a decision is taken on an annual
basis whether to operate the plan for the year a decision has not yet been
taken whether to operate the plan in 2007
restricted share plan rsp in april 2004 at the agm the shareholders
approved the introduction of the rsp  currently restricted shares will not
normally be granted for longterm incentive purposes to executive directors or
members of the glt prior to 2006 the gmc it is intended that other than for
executive directors and glt members employees will be eligible to participate
in this plan instead of the dsop  other than in 2004 the year of introduction
employees would generally not be eligible to participate in the dsop and the
rsp in the same year the rsp is normally granted with a four year vesting
period shares vesting 25 each year
awards are typically settled in equity
the following plans are legacy plans which are no longer operated by the
group
performance related share plan prsp this plan operated from 1995 to 2001
and targeted senior executives not participating in the ltip all outstanding
awards have now lapsed the performance condition was the same as for the
ltip  although vested shares could be released three years after grant
plan 2000 a oneoff allemployee option grant was made in 1998 in order to
support the retention of employees over the millennium period in common
with such allemployee plans there is no performance condition to be satisfied
all employees including the executive directors were given the opportunity 
to apply for an option to acquire 2000 shares at an exercise price of £550 per
share these options became exercisable in september 2001 and expired in
september 2005 a small supplementary grant was made to new employees 
in march 1999 at an option price of £814 and these expired in march 2006
 for a list of glt members see ‘directors and senior managers’ on pages 27–28
120 notes to the financial statements continued reuters group plc annual report and form 20f 2006
121
activity relating to share optionsawards during 2006 2005 and 2004 was as follows
weighted
average
exercise
price for
option
saye plan dsop ltip  plans
plan 2000  rsp abpsp prsp total £
ordinary shares under option in millions including adss
1 january 2004 302 141 564 – 135 1142 286
granted 46 – 103 – 26 175 245
forfeited 03 03 08 – 02 16 342
exercised 05 – 25 – 09 39 162
expired or lapsed 41 24 42 – 04 111 427
31 december 2004 299 114 592 – 146 1151 271
granted 34 – 75 23 22 154 207
forfeited 25 04 25 01 04 59 460
exercised 12 – 48 01 07 68 166
expired or lapsed 14 103 40 – 44 201 388
31 december 2005 282 07 554 21 113 977 270
granted 53 – 90 – 28 171 168
forfeited 09 – 16 01 02 28 164
exercised 207 – 77 20 – 304 108
expired or lapsed 06 07 41 – 06 60 412
31 december 2006 113 – 510 – 133 756 256
of which exercisable 02 – 306 – 24 332
number of participants at 31 december 2006 6601 – 6075 – 154
expense included in the income statement for year ended £m £m £m £m £m £m
31 december 2004 4– 9 5 4 22
31 december 2005 5 – 18 2 5 30
31 december 2006 6 – 16 1 7 30
options were exercised on a regular basis throughout the year and the weighted average share price was £396 2005 £392 2004 £354
the following table summarises information relating to the number of shares under option and those which were exercisable at 31 december 2006
exercisable
weighted options options options weighted
average exercisable at exercisable at exercisable at average exercise
total shares remaining 31 december 31 december 31 december price for options
under option contractual life 2006 2005 2004 exercisable at
range of exercise prices million months million million million 31 december 2006
ordinary shares
£000 – £200 286 33 68 25 25 £085
£201 – £500 366 66 171 120 92 £290
£501 – £700 57 58 57 51 142 £558
£701 – £900 36 54 36 46 37 £862
£901 – £1100 – – – 04 03 –
adss 
1001 – 3000 – – – 01 – –
3001 – 5000 11 24 – – – 4286
756 332 247 299
 one ads is equivalent to six ordinary shares
the fair values of options granted during the period were determined using options pricing models
financials reuters group plc annual report and form 20f 2006
33 employee share plans continued
the following tables summarise the models and key assumptions used for grants made during 2006 2005 and 2004
2006
saye plan dsop rsp ltip
weighted average fair value £ 117 173 365 339
options pricing model used black scholes black scholes black scholes monte carlo
options options options simulation based
pricing model pricing model pricing model customised options
pricing model
key assumptions used
weighted average share price £ 377 420 388 453
range of exercise prices £ 314 393 nil nil
range of expected volatility  35 23–48 25–41 36
range of riskfree rates  5 4–5 5 5
range of expected option term life 3 years 4 to 7 years 1 to 4 years 3 years
expected dividends per year 10p 10p1065p 10p1065p 10p
2005
saye plan dsop abpsp rsp ltip
weighted average fair value £ 161 130 395 381 249
options pricing model used black scholes black scholes black scholes black scholes monte carlo
options options options options simulation based
pricing model pricing model pricing model pricing model customised options
pricing model
key assumptions used
weighted average share price £ 412 397 405 404 405
range of exercise prices £ 333 389–405 nil nil nil
range of expected volatility  47 28–54 37 28–54 48
range of riskfree rates  5 4–5 5 4–5 5
range of expected option term life 3 years 4 to 7 years 2 years 1 to 4 years 3 years
expected dividends per year 10p 10p 10p 10p 10p
2004
saye plan dsop rsp ltip
weighted average fair value £ 165 150 298 285
options pricing model used black scholes black scholes black scholes monte carlo
options options options simulation based
pricing model pricing model pricing model customised options
pricing model
key assumptions used
weighted average share price £ 391 388 321 363
range of exercise prices £ 314 321–407 nil nil
range of expected volatility  54 41–58 41–56 53
range of riskfree rates  5 4–5 5 5
range of expected option term life 3 years 4 to 7 years 1 to 4 years 3 years
expected dividends per year 10p 10p 10p 10p
assumptions on expected volatility and expected option term have been made on the basis of historical data wherever available for the period corresponding
with the vesting period of the option volatility is based on daily observations best estimates have been used where historical data is not available in this respect
marketrelated performance conditions which are used to determine the vesting pattern on the ltip options are built into the monte carlo simulation based
options pricing model used to determine fair value of these options
the group recorded a liability for national insurance and other social security taxes of £7 million 2005 £11 million 2004 £9 million in respect of sharebased
payment transactions
122 notes to the financial statements continued reuters group plc annual report and form 20f 2006
123
34 related party transactions
the parent company of the group is reuters group plc incorporated in the united kingdom reuters group plc owns 97 of its own shares relating to the
ongoing share buyback programme see note 27 on page 116 in addition 21 of reuters group plc is owned by reuters employee share ownership trusts
esots
the esots were established by reuters in august 1990 january 1994 and august 2004 the esots established in august 1990 and january 1994 are funded by
reuters group plc the esot established in august 2004 is funded by reuters sa the trustee of the esots is an offshore independent professional trustee
shares purchased by the esots which are deducted from shareholders’ equity on the consolidated balance sheet are used to satisfy certain optionsawards 
under the group’s share incentive plans
key management personnel compensation including the group’s directors is shown in the table below
2006 2005 2004
£m £m £m
salaries and shortterm employee benefits 12 810
postemployment benefits 1 12
termination benefits – 1–
sharebased payments 8 64
total 21 16 16
more details of directors’ remuneration and senior management compensation are given in the ‘directors’ remuneration for 2006’ section of the remuneration
report details of which form part of these financial statements
during the year the group carried out a number of transactions with related parties mainly being relationships where the group holds investments in associates
and joint ventures these transactions involved supply of services and were entered into in the normal course of business and on an arm’s length basis
details of these transactions are shown below
31 december amounts amounts 31 december amounts amounts 31 december
2004 invoiced collected 2005 invoiced collected 2006
£m £m £m £m £m £m £m
amounts receivable
joint ventures
factiva  3 39 38 4 30 33 1
fxmarketspace ––– – 6 – 6
other – 1 1 – 1 1 –
associates – 3 3 – – – –
total amounts receivable 3 43 42 4 37 34 7
amounts payable
joint ventures
factiva 1 4 4 1 4 5 –
3times square associates – 18 18 – 19 19 –
associates – 2 2 – 2 2 –
total amounts payable 1 24 24 1 25 26 –
 reuters disposed of the majority of its investment in factiva in december 2006 consequently the £1 million receivable from factiva at 31 december 2006 has been presented within other receivables
see note 19
no amounts were provided for or written off in the income statement in respect of amounts receivable from related parties
the above amounts relate to the rendering or receiving of services between both parties including agency agreements and licence agreements detailed
summaries of key transactions in respect of the group’s related parties are set out below
during 2006 reuters paid £237 million 2005 £47 million 2004 £42 million to the group’s pension funds including £187 million towards funding the deficit in 
the reuters pension fund and the reuters supplementary pension scheme
financials reuters group plc annual report and form 20f 2006
124
34 related party transactions continued
factiva
on 15 december 2006 reuters disposed of the majority of its investment in
factiva prior to this disposal factiva and reuters each provided a variety of
services to the other through a number of commercial arrangements factiva
hosted and maintained reuters pictures archiving service permitted reuters to
incorporate factiva content in certain reuters products and permitted reuters
staff to access factiva content the total value of the services provided by
factiva to reuters in 2006 was £4 million 2005 £4 million 2004 £9 million
reuters provided factiva with technical and administrative support services
including use of reuters premises facilities finance and payroll services
provided content primarily its newswires to factiva for incorporation in certain
factiva services and granted factiva a trademark licence permitting factiva to
use reuters name the total value of the services provided by reuters to
factiva in 2006 was £30 million 2005 £39 million 2004 £23 million
following the disposal of the majority of the investment in factiva reuters will
continue to supply content to factiva under an agreement as a paid supplier
and has entered into or continued a number of commercial arrangements with
factiva and dow jones including some of those described above
in addition to the above amounts reuters held a loan payable to factiva of 
£10 million at the start of 2006 on which interest was payable at libor this
loan was increased to £12 million during the year and it was all repaid prior to
the disposal of the majority of reuters investment in factiva there are no loans
outstanding at 31 december 2006
fxmarketspace
on 4 may 2006 reuters and the chicago mercantile exchange cme entered
into an agreement to form fxmarketspace a 5050 joint venture to create 
a centrallycleared global foreign exchange trading system following
shareholder approval the joint venture was formed on 20 july 2006 reuters
has entered into agreements to provide trading access to and trade notification
services for and distribute market data from fxmarketspace among various
other services and arrangements the total value of the services provided by
reuters to fxmarketspace was £6 million
3 times square associates llc ‘3xsq associates’
reuters is party to a lease entered into in 1998 with 3xsq associates an entity
owned by reuters and rudin times square associates llc formed to acquire
develop and operate the 3 times square property and building pursuant to
the lease which has been amended from time to time reuters leases
approximately 692000 square feet for a remaining term of approximately 15
years expiring in 2021 with an option to terminate ten years early as to 77000
square feet and three successive tenyear renewal options as to the entirety 
of the space reuters made payments to 3xsq associates of 35 million 
£19 million during 2006 and 33 million £18 million during both 2005 
and 2004 in respect of rent operating expenses taxes insurance and other
obligations the lease is supported by a 120 million letter of credit provided
by reuters
35 contingencies and commitments
contingent liabilities and contingent assets
except as described below neither the group nor any of its directors
members of senior management or affiliates is subject to any legal or
arbitration proceedings which may have or have had in the recent past
significant effects on the group’s financial performance or profitability 
the group has no contingent assets
douglas gilstrap and myron tataryn v radianz ltd
radianz americas inc reuters limited blaxmill six limited
reuters c llc reuters america llc and british
telecommunications plc
on 12 september 2005 radianz’s former ceo douglas gilstrap filed a class
action lawsuit purportedly on behalf of radianz option holders against radianz
radianz americas inc reuters limited blaxmill six limited reuters c llc
reuters america llc and bt in the united states district court southern
district of new york relating to the cash cancellation of radianz options in
conjunction with reuters sale of radianz to bt the complaint does not specify
the amount of damages sought under the claims and indemnification
provision of the radianz sale agreement between bt and reuters reuters
elected to take control of the defence of this litigation as to all defendants 
on 15 december 2005 a first amended complaint was filed which among
other things added myron tataryn a former radianz employee based in the
uk as an additional named plaintiff and purported class representative 
on 30 january 2006 the defendants filed a motion to dismiss the case in its
entirety on forum non conveniens grounds on 27 july 2006 the court
dismissed the complaint holding that england is the proper forum for this
matter on 25 august 2006 plaintiffs filed an appeal of the dismissal with the
us court of appeals for the second circuit a date for oral argument on the
appeal has not yet been set separately on 7 december 2006 douglas gilstrap
along with former radianz executives brian dillon and john madigan filed a
new lawsuit in the us district court southern district of new york in their
individual capacities against radianz limited and radianz americas for
essentially the same claims asserted in the dismissed class action complaint
gilstrap dillon and madigan have agreed to stay proceedings on this new
lawsuit pending the resolution of the appeal of the dismissed class action
lawsuit the group believes the claims are without merit and intends to defend
them vigorously
ariel uk limited v reuters group plc reuters c llc
reuters transaction services limited instinet group
incorporated the nasdaq stock market inc and silver lake
partners lp
on 16 november 2005 ariel uk limited brought an action in the united
states district court southern district of new york against reuters group plc
reuters c llc reuters transactions services limited instinet group nasdaq
and silver lake partners lp  seeking a declaration that a 1975 agreement
between ariel and instinet permits ariel to license reuters current patent
portfolio to others the complaint as amended on 28 february 2006 also
claims breach of contract copyright infringement and requests for declaratory
relief ariel seeks 50 million compensatory damages from reuters and instinet
reuters answered the complaint and filed a motion to dismiss the case which
was granted on 31 october 2006 dismissing the copyright claims with
prejudice and the state law contract claims for lack of jurisdiction ariel
appealed to the us court of appeals for the second circuit the group
believes the claims are without merit and intends to defend them vigorously
notes to the financial statements continued reuters group plc annual report and form 20f 2006
capital commitments
capital expenditure contracted for at the balance sheet date but not yet incurred is as follows
2006 2005 2004
£m £m £m
property plant and equipment 10 16 37
intangible assets 9 13 –
total capital commitments 19 29 37
group’s share of contingent liabilities and commitments in respect of associates and joint ventures
the group’s share in contingent liabilities and commitments in relation to its interest in associates and joint ventures was £nil 2005 £nil 2004 £nil
warranties and indemnities
during 2005 the group disposed of a number of its investments and provided standard warranties and indemnities as part of the sale and purchase agreements
the likelihood of the group incurring any liability in relation to these is considered remote therefore no provisions have been recorded and no disclosure is
presented in the financial statements
operating lease payables
minimum payments for noncancellable operating leases for terms in excess of one year from 31 december are as follows
2006 2005 2004
year ended 31 december £m £m £m
2005 – – 103
2006 – 7981
2007 88 74 74
2008 79 63 67
2009 70 54 61
2010 60 51 55
2011 55 47 36
2012 and thereafter 300 305 216
total operating lease payables 652 673 693
at 31 december 2006 future minimum sublease payments expected to be received under noncancellable subleases were £96 million 2005 £114 million 2004 
£24 million
the group leases various facilities under noncancellable operating lease agreements the leases have various terms escalation clauses and renewal rights 
the group also leases equipment under noncancellable operating lease agreements
125 financials reuters group plc annual report and form 20f 2006
36 acquisitions
acquisition of application networks inc
on 12 june 2006 a group company merged with application networks inc in accordance with ifrs 3 ‘business combinations’ this transaction has been
accounted for as an acquisition
book fair value provisional
value adjustments fair value
£m £m £m
noncurrent assets
intangible assets –1717
current assets
other current assets 1– 1
current liabilities 2 – 2
noncurrent liabilities – 7 7
net assets acquired 1 10 9
goodwill 13
total consideration 22
consideration satisfied by
cash 22
the fair value adjustments in respect of intangible assets are due to the recognition of £1 million in respect of trademarks and £16 million in respect of technology
knowhow which have been independently valued the fair value adjustments in respect of noncurrent liabilities are due to the recognition of a deferred tax
liability arising from these intangible assets goodwill represents the value of synergies arising from the acquisition and the acquiree’s assembled work force
the outflow of cash and cash equivalents on the acquisition can be calculated as follows
£m
cash consideration 22
from the date of acquisition to 31 december 2006 the acquisition contributed £1 million to revenue incurred a £2 million loss before interest and amortisation 
of intangibles and incurred a £2 million loss before amortisation but after interest
if the acquisition had been made at the beginning of the financial year application networks would have contributed £2 million to revenue and incurred 
a £5 million loss this information takes into account the amortisation of acquired intangible assets and the effect of taxation
other acquisitions
reuters acquired certain trade and assets of india quotation systems private limited iqs in june 2006 and purchased the share capital of telerate italia srl 
in july 2006
book fair value provisional
value adjustments fair value
£m £m £m
noncurrent assets
intangible assets –1111
current assets
cash and cash equivalents 1– 1
other current assets 2– 2
current liabilities 3 – 3
noncurrent liabilities – 4 4
net assets acquired –77
goodwill 5
total consideration 12
consideration satisfied by
cash 10
deferred consideration 2
total consideration 12
the fair value adjustments in respect of intangible assets are due to the recognition of £11 million in respect of customer relationships the fair value adjustments in
respect of noncurrent liabilities are due to the recognition of a deferred tax liability arising from these intangible assets goodwill represents the value of synergies
arising from the acquisition
126 notes to the financial statements continued reuters group plc annual report and form 20f 2006
the outflow of cash and cash equivalents on the acquisitions can be calculated as follows
£m
cash consideration 10
cash acquired 1
total outflow of cash and cash equivalents 9
from the date of acquisition to 31 december 2006 the acquisitions contributed £3 million to revenue £2 million profit before interest and amortisation of
intangibles and incurred a £2 million profit before amortisation but after interest 
if the acquisitions had been made at the beginning of the financial year they would have contributed £6 million to revenue and incurred a £4 million profit this
information takes into account the amortisation of acquired intangible assets and the effect of taxation
37 disposals
realised net gains all of which were recorded in the income statement within continuing operations were
2006 2005 2004
£m £m £m
on disposal of subsidiary undertakings 4 44
on disposal of associates joint ventures and availableforsale financial assets 76 38 203
recorded in the income statement 80 42 207
in 2006 gains on disposal of associates joint ventures and availableforsale financial assets principally relate to the group’s disposal of the majority of its holding in
factiva gains on disposal of subsidiary undertakings relate to a number of small disposals and include £2 million deferred proceeds from the disposal of rvc in 2004
in 2005 gains on disposal of associates joint ventures and availableforsale financial assets include £4 million arising from the group’s disposal of its holding in
quick corporation and £33 million in respect of the partdisposal of shares in tsi gains on disposal of subsidiary undertakings mainly comprise an £8 million gain
on disposal of a number of uk entities partly offset by a £6 million loss on disposal of the reuters portfolio management system rpms business in 2005 reuters
also disposed of its holdings in radianz and instinet group these subsidiaries were treated as discontinued operations in accordance with ifrs 5 and are therefore
disclosed separately in note 7
in 2004 gains on disposal of associates joint ventures and availableforsale financial assets principally relate to the group’s reduction of its stake in tsi from 484
to 88 £149 million and the disposal of its 342 stake in gl trade £47 million gains on disposal of subsidiary undertakings relate to the disposal of a number
of whollyowned subsidiaries including towergroup yankee and ort
38 post balance sheet events
during the period 1 january 2007 to 9 march 2007 the group purchased 155 million shares for total consideration of £68 million as a part of its ongoing share 
buyback programme announced in july 2005
the following table provides a summary of the shares bought back during this period
total number approximate
of shares value of shares
purchased as that may yet
part of publicly average price be purchased
announced paid per under the
month programme share £ programme £m
january 5700000 443 225
february 6300000 432 197
march 3450000 430 182
included above are 120 million shares which the group has irrevocable commitments to purchase at 31 december 2006 in accordance with the group’s accounting
policy the cost of these shares £53 million has been recorded in the balance sheet at 31 december 2006 and reported as a current liability with a corresponding
deduction from shareholders’ equity
on 1 march 2007 the group announced that it expects to increase the buyback during 2007 to £400–425 million which includes £250 million remaining of the 
£1 billion buyback announced in july 2005 and that it will actively manage its capital structure to maintain an investment grade rating of bbbbaa1 following 
this announcement standard and poor’s and fitch ratings both revised downwards the longterm ratings from a to bbb and moody’s have put the rating 
under review for a possible downgrade
an additional £6 million was contributed by each partner in fxmarketspace in early 2007
127 financials reuters group plc annual report and form 20f 2006
39 significant subsidiary undertakings joint ventures and associates
the principal subsidiary undertakings joint ventures and associates at 31 december 2006 all of which are included in the consolidated financial statements 
are shown below
subsidiary undertakings country of incorporation principal area of operation percentage of equity shares held
reuters ag germany germany 100
reuters america holdings inc  usa worldwide 100
reuters america llc usa usa 100
reuters australia pty limited australia australia 100
reuters bv netherlands netherlands 100
reuters canada limited canada canadausa 100
reuters europe sa switzerland spainportugal 100
reuters france snc france france 100
reuters finance plc  uk uk 100
reuters group overseas holdings limited  uk worldwide 100
reuters holdings limited  uk uk 100
reuters hong kong limited cook islands hong kong 100
reuters international holdings sarl  switzerland worldwide 100
reuters investments limited  uk uk 100
reuters italia spa italy italy 100
reuters japan kabushiki kaisha japan japan 100
reuters limited uk worldwide 100
reuters middle east limited cook islands middle east 100
reuters nederland bv  netherlands netherlands 100
reuters research inc usa usa 100
reuters sa switzerland worldwide 100
reuters singapore limited singapore singapore 100
reuters transaction services limited uk worldwide 100
joint ventures and associates country of incorporation principal area of operation percentage of equity shares held
3 times square associates llc usa usa 50 
fxmarketspace limited uk worldwide 50
times global broadcasting company limited india india 26
 denotes investment companies all other entities are operating companies
 the group has an equity shareholding of 50 in 3 times square associates llc however the group has an effective economic interest of 38 at 31 december 2006
the financial years for all of the above undertakings end on 31 december except for times global broadcasting company limited whose financial year ends on 
31 march
3 times square associates llc is a joint venture with rudin times square associates llc formed to acquire develop and operate the 3 times square property and
building
fxmarketspace limited is a new joint venture with the chicago mercantile exchange formed to create a centrallycleared global foreign exchange trading system
times global broadcasting company limited is an association with the times of india relating to the launch of a new indian tv news channel times now
128 notes to the financial statements continued reuters group plc annual report and form 20f 2006
129 financials summary of differences 
between ifrs as adopted by the eu and us gaap
accounting principles
these consolidated financial statements have been prepared in accordance
with ifrs as adopted by the eu which differ in certain significant respects from
us gaap 
material differences between ifrs as adopted
by the eu and published ifrs
for the group there are no material differences between the application of
ifrs as issued by the international accounting standards board and ifrs as
adopted by the eu
material differences between ifrs as adopted
by the eu and us gaap
a description of the relevant accounting principles which differ materially is
given below
a goodwill and other intangibles
goodwill
prior to the adoption of ifrs on 1 january 2004 goodwill arising on acquisitions
before 1998 and accounted for under the purchase method was eliminated
against equity goodwill arising on acquisitions from 1998 to 31 december 2003
was capitalised and amortised over its useful life
under ifrs from 1 january 2004 goodwill arising on acquisitions is no longer
amortised and is allocated to cash generating units and assessed for
impairment at least annually the group has elected not to apply ifrs 3
‘business combinations’ retrospectively to business combinations that took
place prior to the group’s 1 january 2004 transition date to ifrs and
amortisation arising prior to transition has not been reversed goodwill arising
on acquisitions before 1 january 2004 remains at its previous carrying value at
the date of transition to ifrs
under us gaap  prior to 1 july 2001 goodwill was amortised over its estimated
useful life in 2002 reuters adopted the provisions of fas 142 ‘goodwill and
other intangible assets’ and as a result goodwill arising on acquisitions
completed after 30 june 2001 was not amortised from 1 january 2002
goodwill was no longer subject to amortisation under us gaap  goodwill is
assessed for impairment at least annually as a result of differences in the
carrying value of goodwill under us gaap  impairment charges may differ from
those recorded under ifrs
in addition to differences arising from the previous gaap requirement to
amortise goodwill as described above goodwill balances at the date of ifrs
adoption may differ from us gaap balances because of differences in the
measurement of the fair value ascribed to quoted securities issued to effect 
a business combination differences in the treatment of contingent purchase
consideration differences in the application of eitf 953 ‘recognition of
liabilities in connection with a purchase combination’ as discussed in section h
and differences in the definition of separately identifiable intangible assets of
the acquiree to which purchase consideration should be allocated
other intangibles
prior to the adoption of ifrs on 1 january 2004 identifiable intangibles
acquired in a business combination were required to be recognised separately
on the balance sheet and amortised over their useful life
under us gaap  a different definition of intangible assets is applied therefore
additional intangible assets were identified under us gaap giving rise to
additional amortisation
b joint ventures and associates
under us gaap  the group’s share of the results of joint ventures and
associates is adjusted to reflect the nonamortisation of goodwill since
1 january 2002 
under ifrs the group has elected not to apply ifrs 3 ‘business combinations’
retrospectively to business combinations that took place prior to the transition
date to ifrs and this also applies to past acquisitions of associates and joint
ventures goodwill arising on the acquisition of associates and joint ventures
before the transition date remains at its previous carrying value at the transition
date to ifrs of 1 january 2004
c deferred gain on assets contributed to joint ventures
prior to the adoption of ifrs on 1 january 2004 where the fair value of assets
contributed to joint ventures and associates was greater than the book value
the difference was recognised in reserves under us gaap  the difference is
released to the income statement over the anticipated life of the long lived
assets contributed to the venture
d profit or loss on disposal of subsidiary undertakings joint
ventures and associates
on the disposal of subsidiary undertakings joint ventures and associates
a different gain or loss on sale may arise as a result of the following
goodwill
prior to the transition to ifrs goodwill arising on business combinations was
amortised on a systematic basis or prior to 1998 written off directly to
reserves under us gaap  goodwill is not amortised but tested for impairment
on an annual basis under us gaap  therefore the carrying value of goodwill 
is different and results in different gains or losses on disposal
investment hedge on foreign subsidiaries
under ifrs gains and losses on the fair value of instruments designated as
hedges against the carrying value of group undertakings are recognised in 
a hedging reserve within equity to the extent that the hedge is effective on
disposal of such undertakings cumulative gains and losses that had previously
been recognised in the hedging reserve are transferred and recognised in the
income statement under us gaap  reuters has not designated any of its
derivative instruments as qualifying hedge instruments under fas 133
accordingly no cumulative gains and losses from hedging are transferred to 
the income statement on disposal of group undertakings under us gaap 
recycling of foreign currency translation differences
under ifrs gains and losses on the retranslation of assets and liabilities of
foreign operations that have been recorded in equity since the ifrs transition
date of 1 january 2004 are transferred to the income statement and recognised
as part of the gain or loss on disposal of those operations
under us gaap  amounts attributable to foreign operations that have been
accumulated in the translation adjustment component of equity from the date
of acquisition are removed from the separate component of equity and are
reported as part of the gain or loss on disposal of those operations
differences in the amounts recognised on disposals under us gaap and ifrs
arise as the currency translation reserve under ifrs was set to zero on adoption
of ifrs as at 1 january 2004 and also due to underlying gaap differences in
the carrying values under ifrs and us gaap of the underlying foreign currency
assets and liabilities being retranslated
in 2006 there was a us gaap adjustment of £5 million to reduce the profit on
disposal of factiva in 2005 there was a us gaap adjustment of £25 million to
reduce the radianz loss on sale and an adjustment of £57 million to reduce the
instinet gain on sale only instinet qualified as a discontinued operation under
us gaap 
e investments
under ifrs prior to the adoption of ias 32 ‘financial instruments disclosure and
presentation’ and ias 39 ‘financial instruments recognition and measurement’
on 1 january 2005 fixed asset investments were held on the balance sheet at
cost net of permanent diminution in value as assessed by the directors
under ifrs following the adoption of ias 32 and ias 39 availableforsale
financial assets and financial assets held for trading are initially recognised at
fair value in the translation reserve and subsequently remeasured at fair value
the group has classified all of its marketable securities as availableforsale
with the exception of its investment in savvis which was classified as a financial
asset at fair value through profit or loss before being disposed of in 2005
realised and unrealised gains and losses on financial assets held for trading are
included in the income statement in the period in which they arise unrealised
gains and losses arising from changes in fair value of availableforsale assets
are recognised in the statement of recognised income and expense
under us gaap  traded investments are stated at fair value with unrealised
gains or losses included in the income statement investments which have a
readily determinable fair value and are classified as availableforsale are stated
at fair value with unrealised gains or losses included in other comprehensive
income investments in availableforsale assets which do not have a readily
determinable fair value are carried at historic cost reuters group plc annual report and form 20f 2006
130 summary of differences 
between ifrs as adopted by the eu and us gaap continued
f stock options
employee share awards
under ifrs compensation charges relating to equitysettled employee share
awards made after 7 november 2002 but not vested at 1 january 2005 are
based on the fair value of the awards at the date of grant expensed over the
vesting period of the award to match the services received at each balance
sheet date the group revises its estimate of the number of options that are
expected to become exercisable cashsettled sharebased payments are
accrued over the vesting period of the award based on the current fair market
value at each balance sheet date
prior to 1 january 2006 under us gaap  the group applied the measurement
provisions of apb 25 ‘accounting for stock issued to employees’ and
recognised the intrinsic value of options granted as determined on the
measurement date over the vesting period additional compensation cost was
recognised when the vesting of an option was accelerated and those options
would otherwise have been forfeited unvested additional compensation cost
was also recognised where a new measurement date was established following
the amendment of a stock option plan where the exercise price is less than the
market value of the underlying shares on the new measurement date
on 1 january 2006 the group adopted fas 123 revised 2004 ‘sharebased
payment’ fas 123r under fas 123r compensation charges relating to
share awards are based on the fair value of awards in a similar way as under
ifrs differences which affect the group relate to the classification of certain
awards between equity and liabilities the date of grant of certain awards and
the accounting for awards held by non employees
the group has adopted fas 123r on a ‘modified prospective’ basis this
means that it was applied to new awards granted after 1 january 2006 any
portion of awards that were granted after 1 january 1994 that had not vested 
as at 1 january 2006 and any outstanding liability classified awards as a result
there are certain schemes for which fas 123r charges apply which do not
have ifrs charges
fas 123r resulted in a net income statement charge of £1 million greater than
under ifrs in 2006 £3 million of this charge was a cumulative effect of adoption
relating to the recognition of forfeitures and certain liabilityclassified awards
an offsetting £2 million credit relates to the differences noted above on
adoption of fas 123r an increase in net equity compared to that stated
under ifrs of £64 million was recorded resulting from the transfer to equity of
awards previously classified as liabilities
national insurance on stock options
under ifrs the liability for national insurance on stock optionsawards is
accrued based on the fair value of the optionsawards on the date of grant and
adjusted for subsequent changes in the market value of the underlying shares
under us gaap  this expense is recorded upon exercise of the stock
optionsawards
g pensions
for the reporting period to 31 december 2006 reuters adopted fas 158
‘employers’ accounting for defined benefit pension and other post retirement
plans’ in 2005 and 2004 fas 87 ‘employers’ accounting for pensions’ was
applied in calculating the balance sheet position and charge to the income
statement
under both ifrs and us gaap  pension assets defined benefit pension liabilities
and pension expense are determined using the projected unit credit method
under ifrs a provision or asset equal to the difference between the fair value
of scheme assets and the present value of the defined benefit liability is
recognised in full on the balance sheet all actuarial gains and losses which
arise in calculating the present value of the defined benefit obligation and the
fair value of plan assets are recognised immediately in the statement of
recognised income and expense a scheme surplus is recognised only to the
extent that it is recoverable through reduction in future contributions or return
of scheme assets
under fas 87 the accrual or prepayment recognised on the balance sheet in
respect of pensions represents the cumulative income statement charges net of
contributions to the scheme since transition to the standard in addition to this
amount fas 87 requires that an additional minimum liability is recorded for any
plan where the accumulated benefit obligation exceeds the fair value of the plan
assets by an amount greater than the liability recognised in the balance sheet
under fas 158 the provision or surplus recognised on the balance sheet
represents the difference between the fair value of plan assets and the
projected benefit obligation
under both fas 158 and fas 87 in addition to the pension expense items
recognised under ifrs actuarial gains and losses in excess of the corridor are
recognised over the average remaining service life of the employees in
addition there is a transition asset or obligation not recognised on the balance
sheet arising on the adoption of fas 87 this amount is also released to the
income statement over the average remaining service lives of the employees
in 2006 prior to the adoption of fas 158 movements in the additional
minimum liability required under fas 87 amounted to an increase in net assets
of £374 million 2005 increase of £14 million 2004 decrease of £389 million
this movement was recognised directly in equity
the adoption of fas 158 resulted in a reduction in the net asset position at
31 december 2006 in respect of pensions of £497 million this loss is
recognised in shareholder equity and will be released to the income statement
over the average remaining service lives of the employees there is no
difference between the expense recognised in the income statement under
fas 158 and that which would have been recognised under fas 87
h restructuring
under ifrs the group recognises provisions for restructuring charges other
than termination benefits once the group has a present obligation legal or
constructive to incur the costs as a result of a past event it is probable that 
an economic outflow will be required and a reliable estimate can be made 
a constructive obligation is considered to exist when a detailed formal plan is in
place and a valid expectation has been raised in those affected termination
benefits are recognised when the group is demonstrably committed to a plan
of termination when and only when the group has a detailed formal plan 
with specified minimum contents for the termination and there is no realistic
possibility of withdrawal provisions for costs associated with the exit of a
property are recognised once the intention to exit has been announced
under us gaap  employee severance costs that are not onetime termination
charges are recognised when it is probable that these costs will be incurred and
the amount is capable of being estimated charges for costs associated with
the exit of properties are recognised upon vacating the property or legal
termination of the lease contract
under ifrs liabilities for terminating or reducing the activities of an acquired
company are only recognised as part of allocating the cost of a combination 
if they exist at the date of acquisition and meet certain recognition criteria
provisions for future losses or other costs expected to be incurred as a result 
of a business combination are not recognised
under us gaap  the group applies the provisions of eitf 953 ‘recognition of
liabilities in connection with a purchase combination’ which requires
recognition of certain costs incurred in respect of exit activities and integration
if specified conditions are met as part of purchase accounting
i derivative financial instruments
in 2004 under ifrs prior to the adoption of ias 39 ‘financial instruments
recognition and measurement’ and ias 32 ‘financial instruments disclosure
and presentation’ the group applied hedge accounting rules for its derivative
financial instruments used to manage interest rate and foreign exchange risk
under these rules the group was not required to identify separately these
financial instruments nor to record changes in their fair value through the
income statement also under these rules compound derivative instruments
having multiple underlyings could be designated as net investment hedges
and where this treatment was applied foreign currency translation gains and
losses arising on these instruments were recognised directly in equity further 
in 2004 reuters was not required to separate embedded derivatives from their
host contracts and recognise them on the balance sheet at fair value
from 1 january 2005 the group adopted ias 32 ‘financial instruments
disclosure and presentation’ and ias 39 ‘financial instruments recognition 
and measurement’ these standards require all standalone and embedded
derivative instruments to be recognised on the balance sheet at fair value the
method of recognising subsequent changes in fair value depends on whether
the derivative is designated as a hedging instrument and if so the nature of
the item being hedged reuters group plc annual report and form 20f 2006
under ifrs the group has designated certain derivatives as hedges of foreign
net investments and fair value hedges of borrowings for net investment
hedges fair value movements arising from these derivatives are recognised in 
a hedging reserve until transferred to the income statement on disposal or
impairment of the underlying item for fair value hedges fair value movements
are adjusted in the carrying value of borrowings movements in the fair value 
of fair value hedges are recognised in the income statement together with
movements in the fair value of the item being hedged to the extent that
hedges are ineffective gains and losses are recognised in the income
statement
under us gaap  the group adopted fas 133 ‘accounting for derivative
instruments and hedging activities’ as amended by fas 138 on 1 january
2001 fas 133 introduced new rules in respect of hedge accounting and the
recognition of movements in fair value through the income statement as a
result of the adoption all derivatives and embedded derivative instruments
whether designated in hedging relationships or not are carried on the balance
sheet at fair value the group has not designated any of its derivative
instruments as qualifying hedge instruments under fas 133 accordingly
changes in the fair value of derivative and embedded derivative instruments
have been included within the income statement under us gaap 
under ifrs ias 39 grants an exemption from the requirement to recognise
embedded foreign currency derivatives where the currency is commonly used 
in the economic environment of the host contract fas133 does not grant such
an exemption therefore the group identifies and separately accounts for more
embedded derivatives under us gaap than it does under ifrs
j consolidation of subsidiary undertakings
on 16 november 2004 the group purchased the 49 voting stake of radianz
that it did not already own from equant thereby increasing its shareholding
from 51 to 100 of the voting shares under ifrs from the date of acquisition
of the remaining 49 radianz was fully consolidated ifrs 5 ‘noncurrent
assets held for sale and discontinued operations’ was applied for presentation
purposes and hence radianz was classified as a subsidiary acquired with a view
to resale and included in the balance sheet as a noncurrent asset held for sale
liabilities directly associated with the noncurrent assets held for sale were also
shown separately the results of radianz prior to 16 november 2004 were
presented within discontinued operations in the income statement
under us gaap  radianz was treated as a joint venture of the group for the
period 1 january 2004 to 16 november 2004 the acquisition of the additional
49 stake in radianz was accounted for as a step acquisition at which time
radianz was fully consolidated as a subsidiary until its disposal during 2005 it 
is the opinion of the directors that radianz met the criteria set forth in fas 144
‘accounting for the impairment and disposal of long lived assets’ as a
disposal group and was therefore classified as an asset heldforsale until its
disposal although the group has no significant continuing involvement in the
operations of radianz following disposal the classification of radianz as a
discontinued operation is not considered appropriate given a significant level
of continuing cash outflows under us gaap  radianz had a higher carrying
value resulting in a greater write down to fair value less costs to sell at the end
of 2004
k sale and leaseback transactions
under ifrs where gains and losses arise from transactions qualifying as sale
and operating leaseback such gains and losses on the sale of the properties
and rental expenses associated with subsequent leasebacks are recognised 
in the income statement
under us gaap  where a portion of the leased property is sublet and that sub
lease is not minor the sale and leaseback is accounted for as financing the
asset is retained on the balance sheet at its written down value and depreciated
over the term of the lease the proceeds received from the sale of the property
are deferred on the balance sheet as a financing liability whilst lease rental
payments are offset against the liability as they are made the differences
between the initial proceeds received and subsequent rental payments are
recorded as financing costs over the term of the lease
l property plant and equipment
under ifrs the group does not capitalise interest on selfconstructed assets
under us gaap  interest incurred as part of the cost of constructing a fixed
asset is capitalised and amortised over the life of the asset
m shares to be repurchased
under ifrs the group is required to recognise a liability in respect of
irrevocable commitments made to purchase reuters group plc shares as part
of its publiclyannounced buyback programme during the postbalance sheet
close period a corresponding reduction in shareholders’ equity is also
recorded
under us gaap  this commitment is not recorded as a liability and reduction to
shareholders’ equity as there is no fixed price or fixed number of shares and the
counterparty has not purchased any shares as at the balance sheet date
n taxation
under ifrs deferred taxes are accounted for in accordance with ias 12
‘income taxes’ which requires deferred tax to be accounted for on temporary
differences deferred tax assets are recognised to the extent that it is probable
that taxable profits will be available against which the deductible temporary
difference can be utilised assets not recognised are disclosed in note 26
under us gaap  deferred taxes are accounted for in accordance with fas 109
‘accounting for income taxes’ on all temporary differences and a valuation
allowance is established in respect of those deferred tax assets where it is more
likely than not that some portion will remain unrealised
deferred tax adjustments in the ifrs to us gaap reconciliation are primarily
the result of the deferred tax impact of the other us gaap adjustments made
in the reconciliation 
in addition ifrs and us gaap adopt difference bases for recognising deferred
tax on employee share awards under fas 123r deferred tax assets are
recognised over the service period based on the compensation charge any
realised tax deductions which exceed the related compensation charge is
recognised in additional paid in capital apic these ‘windfall’ tax benefits are
pooled and can be used to offset shortfalls in deductions related to other share
awards windfall tax benefits can only enter the apic pool to the extent they
are realised where these benefits form part of tax losses carried forward they
are not recognised until they reduce taxes payable the apic pool as at
1 january 2006 has been calculated using the ‘shortcut method’ option
available under fsp fas 123r3
tax adjustments also arise in respect of the timing of recognition of current tax
benefits
o reclassification of minority interest
ifrs requires the presentation of minority interest within equity on the face of
the balance sheet under us gaap  minority interest is presented as a separate
item on the face of the balance sheet outside of equity
under ifrs certain directly attributable costs are capitalised as part of the cost
of both external and internal software development and amortised over the life
of the asset under us gaap  these costs are not capitalised on internal
software development but expensed as incurred
131 financials reuters group plc annual report and form 20f 2006
132 notes on the summary of differences 
between ifrs as adopted by the eu and us gaap continued
01 adjustments to net income
2006 2005 2004
notes £m £m £m
profitloss attributable to ordinary shareholders in accordance with ifrs 305 456 364
us gaap adjustments
intangible amortisation and impairment a 4 4 21
amortisation of gain on assets contributed to joint ventures c – –6
profitloss on disposal of subsidiaries d – 32 18
profitloss on disposal of joint ventures d 5 ––
profitloss on disposal of associates d – – 35
profitloss on disposal of availableforsale and other financial assets e – 42 18
stock options f 2 1 18
cumulative effect of change in accounting principle for fas 123r f 3 – –
pensions g 29 28 1
restructuring h 59 9 105
derivative financial instruments i 14 42 58
consolidation of subsidiary undertakings j – – 7
sale and leaseback k – 1 1
taxation n 29 18 62
minority interest in respect of us gaap adjustments o – 3 7
net incomeloss attributable to ordinary shareholders in accordance with us gaap 306 396 439
2006 2005 2004
pence pence pence
earnings and dividends
basic earnings per ads  in accordance with us gaap 142 170 188
diluted earnings per ads  in accordance with us gaap 139 165 183
dividend paid per ads  615 60 60
weighted average number of shares used in basic eps calculation millions 1297 1396 1400
dilutive shares 24 41 36
used in diluted eps calculation 1321 1437 1436
 one ads is equivalent to six ordinary shares
02 adjustments to shareholders’ equity
restated
2006 2005 2004
notes £m £m £m
shareholders’ equity in accordance with ifrs 172 511 371
us gaap adjustments
goodwill and other intangibles a 111 128 119
joint ventures and associates b 1 68
deferred gain on assets contributed to joint ventures c – – 31
profitloss on disposal of availableforsale and other financial assets e 7 2 89
stock options f 1 57 33
pensions g 19 177 143
restructuring h 12 71 45
derivative financial instruments i 13 6 8
consolidation of subsidiary undertakings j – – 7
sale and leaseback k 2 2 1
property plant and equipment l 1 11
shares to be repurchased m 53 59 –
taxation n 43 51 39
minority interest in respect of us gaap adjustments o – –1
shareholders’ equity in accordance with us gaap 281 705 568
shareholders’ equity in accordance with ifrs in 2005 has been restated to reflect irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78
this ifrs restatement results in an additional us gaap adjustment ‘shares to be repurchased’ in 2005 as shareholders’ equity in accordance with us gaap in 2005 is unchanged there was no impact
on amounts reported in accordance with ifrs in 2004 reuters group plc annual report and form 20f 2006
03 discontinued operations
under ifrs operations are classified as discontinued if they have been either
disposed of or are classified as held for sale and represent a major line of
business or geographical area of operation the disposal is part of a single
coordinated plan or if the operations constitute a subsidiary acquired
exclusively with a view to resale as discussed in note 7 on page 87–88 there
were no discontinued operations in 2006 under ifrs but radianz instinet and
btc were classified as discontinued operations in 2004 and 2005
under us gaap  operations are classed as discontinuing operations if the
operations and cash flows of the component will be eliminated from the
ongoing operations as a result of the disposal transaction and the group will
not have any significant continuing involvement in the operations after the
disposal the group determined that it had not eliminated significant cash
flows related to radianz and therefore radianz did not meet the criteria for
classification as a discontinued operation accordingly the results of radianz for
us gaap purposes have been reported within continuing operations instinet
and btc did meet the criteria and have been classified within discontinued
operations
the disposal of factiva in 2006 did not meet the criteria for discontinued
operations under ifrs or us gaap 
under us gaap the key data for the operations classed as discontinuing
operations are analysed below
2006 2005 2004
discontinued operations under us gaap £m £m £m
operating income – 96 66
income tax charge – 15 18
profit on disposal 12 133 –
minority interest – 29 4
net income 12 185 44
basic profit per ads 58p 794p 197p
diluted profit per ads 57p 772p 189p
04 additional disclosures required by 
us gaap
derivative financial instruments
the current year loss on derivative financial instruments is £8 million 2005 
£41 million loss 2004 £58 million gain at 31 december 2006 the balance
sheet includes a derivative asset of £33 million and a derivative liability of 
£40 million the current year loss includes a loss of £25 million 2005 £17 million
gain 2004 £21 million gain relating to currency forward contracts embedded
within customer and supplier contracts
recent accounting pronouncements
sab 108 ‘considering the effects of prior year misstatments
when quantifying misstatements in current year financial
statements’
in september 2006 the sec issued sab 108 which provided guidance in
respect of the correction of accounting errors this requires the quantification 
of financial statement errors under us gaap based on the effect of applying
both the ironcurtain and the rollover methods on each of the entity’s primary
statements and related disclosures the ironcurtain method quantifies an error
as the amount by which the balance sheet is misstated whereas the rollover
method quantifies an error as the amount by which the income statement is
misstated the adoption of this guidance by the group in 2006 has not resulted
in any previously immaterial errors now being assessed as material and
requiring retrospective adjustment under either ifrs or us gaap 
fasb statement no 155 ‘accounting for certain hybrid
financial instruments’ fas 155
in february 2006 the fasb issued fas 155 which is an amendment to fas 133
and fas 140 it simplifies accounting for certain hybrid financial instruments by
permitting fair value remeasurement for any hybrid financial instrument that
contains an embedded derivative that otherwise would require bifurcation 
fas 155 is effective for reuters for all financial instruments acquired issued or
subject to a remeasurement new basis event occurring after 1 january 2007
the adoption of fas 155 is not expected to have a material impact on the
group’s financial position or the results of its operations
fasb statement no 157 ‘fair value measurement’ fas 157
in october 2006 the fasb issued fas 157 which addresses how companies
should measure fair value when they are required to use a fair value measure for
recognition or disclosure purposes and move towards a marketbased measure
instead of an entitybased measure and expands disclosure requirements
about fair value measurements it is effective for fiscal years beginning after
15 november 2007 and will be adopted by reuters as at 1 january 2008 the
adoption of fas 157 is not expected to have a significant impact on the
group’s financial position or the results of its operations
fasb statement no 159 ‘the fair value option for financial
assets and liabilities’ fas 159 – including an amendment of
fas 115
in february 2007 the fasb issued fas 159 which permits entities to choose 
to measure many financial instruments and certain other items at fair value 
this statement is effective as of the beginning of fiscal periods beginning after 
15 november 2007 the adoption of fas 159 is not expected to have a
significant impact on the group’s financial position or the results of its
operations
fasb interpretation no 48 ‘accounting for uncertainty in
income taxes’ fin 48
in june 2006 the fasb issued fin 48 which provides an interpretation on 
fas 109 and prescribes a recognition threshold and measurement attribute for
the financial statement recognition and measurement of uncertain tax positions
fin 48 applies to fiscal periods beginning after 15 december 2006 the group
is in the process of assessing the impact on the group’s financial position 
05 audit and nonaudit fees
an analysis of fees payable to the company’s auditors is set out below
2006 2005
£m £m
audit fees 39 30
auditrelated fees 04 22
tax fees 10 26
all other fees 02 01
total fees 55 79
auditrelated fees include accounting advice due diligence activities relating to
acquisitions and disposals and in 2005 advice on preparation for compliance
with section 404 of the sarbanesoxley act tax fees include advisory services
relating to tax planning and employeerelated issues and assistance with
corporation and other tax returns
133 financials reuters group plc annual report and form 20f 2006
134 consolidated financial summary
three year consolidated financial summary ifrs
restated
ifrs ifrs ifrs
2006 2005 2004
for the year ended 31 december £m £m £m
results
revenue
1
2566 2409 2339
net finance costs 15 12 12
profit before tax 313 238 396
taxation 20 9 40
profit attributable to equity holders of the parent 305 456 364
net assets
noncurrent assets 1314 1179 1025
current assets 606 957 1410
current liabilities 913 797 1249
noncurrent liabilities 835 829 714
noncurrent assets classified as held for sale – 1 145
liabilities directly associated with noncurrent assets classified as held for sale – – 47
172 511 570
property plant and equipment
additions 130 137 111
depreciation 95 103 130
2006 2005 2004
ratios
basic earnings per ordinary share from continuing operations 226p 163p 254p
dividends per ordinary share 1025p 100p 100p
book value per ordinary share
2
137p 378p 265p
profit before tax as a percentage of revenue  122 99 169
return on property plant and equipment
3
 804 642 857
return on equity
4
 895 1034 1085
uk corporation tax rate  30 30 30
infrastructure
shares issued millions 1470 1441 1436
employees 16900 15300 14465
user accesses 342000 346000 328000
2005 has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 78 the impact of recognising these
commitments is to increase current liabilities and to decrease shareholders’ equity at 31 december 2005 by £59 million
notes
1 2004 and 2005 exclude revenue for instinet group which was classified as a discontinued operation and subsequently sold in 2005
ratios
2 book value per ordinary share represents total parent shareholders’ equity divided by the number of shares in issue after deducting shares held by employee share ownership trusts and repurchased
shares
3 return on property plant and equipment represents profit after tax from continuing operations as a percentage of average property plant and equipment the average is calculated by adding
property plant and equipment at the start and the end of each year and dividing by two
4 return on equity represents profit attributable to equity holders of the parent divided by the average total parent shareholders’ equity the average is calculated by adding total parent shareholders’
equity at the start and the end of each year and dividing by two reuters group plc annual report and form 20f 2006
135
nine year consolidated financial summary uk gaap
uk gaap uk gaap uk gaap uk gaap uk gaap uk gaap uk gaap uk gaap uk gaap
2003 2002 2001 2000 1999 1998 1997 1996 1995
for the year ended 31 december £m £m £m £m £m £m £m £m £m
results
revenue 3235 3593 3885 3592 3125 3032 2882 2914 2703
net interest payablereceivable 29 20 9 3 4 2 80 61 60
profitloss before tax 56 344 158 657 632 580 626 652 558
taxation 22 23 107 136 196 196 236 210 185
profitloss attributable to ordinary shareholders 50 255 46 521 436 384 390 442 373
net assets
fixed assets 1192 1448 1963 1868 1205 1098 1046 1026 999
net current liabilitiesassets 89 190 134 293 170 577 790 525 387
longterm creditors 425 354 344 310 284 16 37 41 135
provisions 271 245 212 112 88 116 120 51 39
407 659 1273 1153 663 389 1679 1459 1212
tangible fixed assets
additions 130 154 276 282 244 296 361 372 304
depreciation 193 227 246 276 310 331 312 283 250
development expenditure 171 200 294 323 197 200 235 202 191
2003 2002 2001 2000 1999 1998 1997 1996 1995
ratios
earningsloss per ordinary share 36p 183p 33p 371p 309p 267p 240p 273p 232p
dividends per ordinary share 100p 100p 100p 160p 1465p 144p 130p 1175p 98p
book value per ordinary share
1
152p 307p 682p 737p 405p 233p 999p 883p 737p
profitloss before tax as a percentage of revenue  17 96 41 183 202 191 217 224 206
return on tangible fixed assets
2
 63 568 78 783 591 482 490 600 552
return on equity
3
 157 368 46 650 922 785 256 337 348
uk corporation tax rate  30 30 30 30 30 31 32 33 33
infrastructure
shares issued millions 1433 1433 1431 1429 1423 1422 1694 1689 1677
employees 16744 17414 19429 18082 16546 16938 16119 15478 14348
user accesses 338000 388000 592000 558000 520858 482380 429000 362000 327100
notes
information provided prior to 2004 year end was reported under uk gaap which may differ materially from ifrs the main differences impacting the group’s financial statements are on account 
of sharebased payments employee benefits intangible assets and financial instruments
2003 and 2002 have been restated following adoption of uitf17 and uitf38 and the reclassification of transactionrelated regulatory fees following recently issued sec guidance
2003 and 2002 user accesses have been revised to reflect the exclusion of mobile and other lowcost accesses 1997 and 1998 have been restated to reflect changes to reporting user accesses in 1999
1999 and 2000 have been restated following adoption of frs 19
1995 and 1996 have been restated to reflect the effect of frs 10 issued in 1997 which required purchased goodwill and intangible assets to be capitalised and amortised through the profit and loss account
ratios
1 book value per ordinary share represents adjusted shareholders’ equity divided by the number of shares in issue after deducting shares held by employee share ownership trusts in 1995 to 1997
shares in reuters holding plc held by group companies are also deducted from shares in issue adjusted shareholders’ equity is calculated after deducting the carrying value of interests in shares 
of reuters holdings plc 1995 to 1997
2 return on tangible fixed assets represents profit after taxation as a percentage of average tangible fixed assets the average is calculated by adding tangible fixed assets at the start and the end 
of each year and dividing by two
3 return on equity represents profit attributable to ordinary shareholders divided by the average adjusted shareholders’ equity the average is calculated by adding adjusted shareholders’ equity 
at the start and the end of each year and dividing by two in 1998 a weighted average has been used to reflect the capital reorganisation
financials reuters group plc annual report and form 20f 2006
parent company audit opinion
independent auditors’ report to the members
of reuters group plc
we have audited the parent company financial statements of reuters group
plc for the year ended 31 december 2006 which comprise the balance sheet
and the related notes these parent company financial statements have been
prepared under the accounting policies set out therein we have also audited
the information in the directors’ remuneration report that is described as
having been audited
we have reported separately on the group financial statements of reuters
group plc for the year ended 31 december 2006
respective responsibilities of directors and auditors
the directors’ responsibilities for preparing the annual report the directors’
remuneration report and the parent company financial statements in
accordance with applicable law and united kingdom accounting standards
united kingdom generally accepted accounting practice are set out in the
statement of directors’ responsibilities
our responsibility is to audit the parent company financial statements and the
part of the directors’ remuneration report to be audited in accordance with
relevant legal and regulatory requirements and international standards on
auditing uk and ireland this report including the opinion has been prepared
for and only for the company’s members as a body in accordance with section
235 of the companies act 1985 and for no other purpose we do not in giving
this opinion accept or assume responsibility for any other purpose or to any
other person to whom this report is shown or into whose hands it may come
save where expressly agreed by our prior consent in writing
we report to you our opinion as to whether the parent company financial
statements give a true and fair view and whether the parent company financial
statements and the part of the directors’ remuneration report to be audited
have been properly prepared in accordance with the companies act 1985 we
also report to you whether in our opinion the information given in the directors
report is consistent with the parent company financial statements the
directors’ report includes that specific information presented in the ‘information
for shareholders’ that is crossreferred from the ‘company information’ and
‘operating and financial review’ section of the directors’ report
in addition we report to you if in our opinion the company has not kept proper
accounting records if we have not received all the information and explanations
we require for our audit or if information specified by law regarding directors’
remuneration and other transactions is not disclosed
we read other information contained in the annual report and consider
whether it is consistent with the audited parent company financial statements
the other information comprises only the directors’ report which comprises the
business review explaining reuters the ceo’s review information about
strategy performance markets resources and challenges the chairman’s
statement the speed of change corporate governance matters interview 
with the chairman note to board information about the board directors and
senior managers the unaudited part of the remuneration report the statement
of directors’ responsibilities and compliance the company information
operating and financial review and selected financial highlights and the other
shareholder information we consider the implications for our report if we
become aware of any apparent misstatements or material inconsistencies with
the parent company financial statements our responsibilities do not extend to
any other information
basis of audit opinion
we conducted our audit in accordance with international standards on auditing
uk and ireland issued by the auditing practices board an audit includes
examination on a test basis of evidence relevant to the amounts and
disclosures in the parent company financial statements and the part of the
directors’ remuneration report to be audited it also includes an assessment 
of the significant estimates and judgments made by the directors in the
preparation of the parent company financial statements and of whether the
accounting policies are appropriate to the company’s circumstances
consistently applied and adequately disclosed
we planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the parent company
financial statements and the part of the directors’ remuneration report to be
audited are free from material misstatement whether caused by fraud or other
irregularity or error in forming our opinion we also evaluated the overall
adequacy of the presentation of information in the parent company financial
statements and the part of the directors’ remuneration report to be audited
opinion
in our opinion
• the parent company financial statements give a true and fair view in
accordance with united kingdom generally accepted accounting practice 
of the state of the company’s affairs as at 31 december 2006
• the parent company financial statements and the part of the directors’
remuneration report to be audited have been properly prepared in
accordance with the companies act 1985 and
• the information given in the directors report is consistent with the parent
company financial statements
pricewaterhousecoopers llp
chartered accountants and registered auditors
london
15 march 2007
the parent company audit opinion set out above is included for the purposes of reuters annual
report and financial statements only and does not form part of reuters form 20f for 2006
136 separate financial statements of reuters group plc
for the year ended 31 december 2006 reuters group plc annual report and form 20f 2006
137
reuters group plc – balance sheet
at 31 december
restated
2006 2005
notes £m £m
fixed asset investments 01 4966 5273
current assets
derivative financial instruments 30 15
availableforsale financial assets 02 2 2
debtors including £5 million 2005 £5 million due after more than one year 03 1221 865
cash at bank and in hand 1 1
1254 883
creditors amounts falling due within one year 04 4677 4159
net current liabilities 3423 3276
total assets less current liabilities 1543 1997
creditors amounts falling due after more than one year 05 182 14
net assets 1361 1983
capital and reserves 07
called up share capital 08 355 360
capital redemption reserve 13 1
share premium account 141 107
other reserves 445 722
reserve for own shares 859 283
profit and loss account 1266 1076
total shareholders’ funds 1361 1983
2005 has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 138 the
impact of recognising these commitments is to increase creditors amounts falling due within one year and to decrease shareholders’ funds at 31 december 2005
by £59 million
the accounting policies and notes on pages 138 to 143 form part of these financial statements
the financial statements on pages 137 to 143 were approved by the board of directors on 15 march 2007
tom glocer david grigson
ceo cfo
financials reuters group plc annual report and form 20f 2006
reuters group plc – 
accounting policies
basis of accounting
the financial statements are prepared on a going concern basis under the
historical cost convention unless otherwise stated below and in accordance
with the companies act 1985 and applicable accounting standards uk gaap
as permitted by section 2303 of the companies act 1985 the company’s
profit and loss account has not been presented
the reuters group plc consolidated financial statements for the year ended
31 december 2006 contain a consolidated statement of cash flows
consequently the company has taken advantage of the exemption in frs 1
revised 1996 ‘cash flow statements’ not to present its own cash flow
statement
the reuters group plc consolidated financial statements for the year ended
31 december 2006 contain related party disclosures consequently the
company has taken advantage of the exemption in frs 8 ‘related party
disclosures’ not to disclose related party disclosures for the company
the reuters group plc consolidated financial statements for the year ended
31 december 2006 contain financial instrument disclosures which comply with
frs 25 ias 32 consequently the company has taken advantage of the
exemption in frs 25 not to present separate financial instrument disclosures 
for the company
the 2005 balance sheet has been restated to recognise irrevocable
commitments during close periods as a liability during the close period
following the 2006 year end the company repurchased 120 million shares
2005 135 million shares under these commitments at a total cost of 
£53 million 2005 £59 million the impact of recognising these commitments 
is to increase creditors amounts falling due within one year and to decrease
shareholders’ funds at 31 december 2006 by £53 million 2005 £59 million
foreign currency translation
transactions in foreign currencies are translated into the company’s functional
currency using the exchange rate prevailing at the date of the transaction
foreign exchange gains and losses resulting from settlement of such transactions
and from the translation at year end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the profit and 
loss account except when deferred in reserves as qualifying cash flow hedges
exchange differences on nonmonetary items such as availableforsale
financial assets are included in the fair value reserve
sharebased payments
the company does not incur a charge for sharebased payments however 
the issuance by the company of share options to employees of its subsidiaries
represents additional capital contributions by the company to its subsidiaries
an addition to the company’s investment in subsidiaries is reported with a
corresponding increase in shareholders’ funds the additional capital
contribution is determined on the basis of the fair value of options granted 
at the date of grant and is gradually increased over the vesting period of 
the award
investments
the company classifies its investments in the following categories
• fixed asset investments
• financial assets at fair value through profit and loss
• loans and receivables and
• availableforsale financial assets
the classification depends on the purpose for which the assets were acquired
management determines the classification of its investments at initial
recognition and reevaluates this designation at every reporting date
fixed asset investments
fixed asset investments are held at cost net of impairment in value as assessed
by the directors
financial assets at fair value through profit and loss
this category includes financial assets held for trading and those designated 
at fair value through profit and loss at inception a financial asset is classified in
this category if acquired principally for the purpose of selling in the shortterm
or if so designated by management derivatives are also classified as held for
trading unless they are designated as hedges assets in this category are
initially recognised at fair value on the trade date and subsequently remeasured
at each reporting date transaction costs directly attributable to the acquisition
of the asset are recognised immediately in the profit and loss account realised
and unrealised gains and losses are included in the profit and loss account in
the period in which they arise
loans and receivables
loans and receivables are nonderivative financial assets with fixed or
determinable payments that are not quoted in an active market they are
included in debtors in the balance sheet assets in this category are initially
recognised on the trade date at fair value plus transaction costs and
subsequently measured at amortised cost using the effective interest method
availableforsale financial assets
the company has classified all of its marketable securities as availableforsale
assets in this category are initially recognised on the trade date at fair value
plus transaction costs and subsequently remeasured at each reporting date
unrealised gains and losses arising from changes in fair value are recognised
directly in reserves
impairment and derecognition
the company assesses at each balance sheet date whether there is objective
evidence that a financial asset or group of financial assets is impaired
on impairment the cumulative loss recognised in reserves is removed from
reserves and recognised in the profit and loss account on disposal of the
assets gains or losses recognised in reserves are removed from reserves and
recognised in the profit and loss account
cash
cash includes cash in hand and bank deposits repayable on demand
138 separate financial statements of reuters group plc
for the year ended 31 december 2006 continued reuters group plc annual report and form 20f 2006
139
borrowings
borrowings are initially recognised at fair value net of transaction costs incurred
and are subsequently stated at amortised cost adjusted for fair value
movements in respect of related fair value hedges any difference between the
proceeds net of transaction costs and the redemption value is recognised in
the profit and loss account over the period of the borrowings using the effective
interest method
borrowings are classified as current liabilities unless the company has an
unconditional right to defer settlement of the liability for at least twelve months
after the balance sheet date
borrowing costs on qualifying assets are expensed as incurred and not
capitalised as cost of the asset
purchases and sales of financial assets
purchases and sales of financial assets are recognised on the settlement date
which is the date that the asset is delivered to or by the company
derivative financial instruments and hedging
derivatives are initially recognised at fair value on the date a derivative contract
is entered into and are subsequently remeasured at their fair value the method
of recognising the resulting gain or loss depends on whether the derivative is
designated as a hedging instrument and if so the nature of the item being
hedged the company designates certain derivatives as hedges of the fair value
of recognised assets or liabilities or a firm commitment fair value hedges
fair value hedges
changes in the fair value of derivatives that are designated and qualify as fair
value hedges are recorded in the profit and loss account together with any
changes in the fair value of the hedged asset or liability that are attributable to
the hedged risk the gain or loss relating to the ineffective portion is recognised
immediately in finance costs
derivatives that do not qualify for hedge accounting
certain derivative instruments while providing effective economic hedges under
the company’s policies are not designated as hedges changes in the fair value
of any derivative instruments that do not qualify for hedge accounting are
recognised immediately in the profit and loss account the company does not
hold or issue derivative financial instruments for speculative purposes
fair value estimation
the fair value of financial instruments traded in active markets such as available
forsale securities is based on quoted market prices at the balance sheet date
the fair value of foreign exchange contracts is determined using forward
exchange market rates at the balance sheet date other financial instruments
are valued using standard pricing models based on quoted forward market
rates interpolated between dates where appropriate and discounted cash flow
techniques guarantees are fair valued using probability of default based on
external market data
interest in shares of reuters group plc
shares held by the reuters employee share ownership trusts that are
sponsored by the company and repurchased shares are recorded in the balance
sheet at cost and reported as a deduction from shareholders’ funds
irrevocable commitments to repurchase shares during close periods entered
into before the balance sheet date are recorded in the balance sheet at
estimated cost and reported as a current liability with a corresponding
deduction from shareholders’ funds
dividend distribution
dividend distributions are recognised as a liability in the period in which the
dividends are approved by the company’s shareholders interim dividends are
recognised when they are paid final dividends when authorised in general
meeting by shareholders
taxation
tax deferred or accelerated by the effect of timing differences is accounted for
to the extent that a transaction or an event that has occurred at the balance
sheet date gives rise to an obligation to pay more tax in the future or a right to
pay less tax in the future
however deferred tax assets are only recognised to the extent that based on
all available evidence it is more likely than not that suitable taxable profits will
arise from which the reversal of the asset can be deducted
deferred tax is recognised on an undiscounted basis
financials
reuters group plc – notes to the financial statements
01 fixed asset investments
2006 2005
£m £m
cost
1 january 18909 18896
capital contributions in respect of share options 12 13
31 december 18921 18909
amounts written off
1 january 13636 13636
written off in year see note 7 319 –
31 december 13955 13636
carrying amount 4966 5273
the principal subsidiary undertakings at 31 december 2006 are shown below
country of principal area percentage of  
subsidiary undertakings incorporation of operation equity shares held
reuters holdings limited  uk uk 97
reuters investments limited  uk uk 100
 denotes investment companies reuters group plc annual report and form 20f 2006
140 separate financial statements of reuters group plc
for the year ended 31 december 2006 continued
02 availableforsale financial assets
2006 2005
£m £m
1 january 2 –
transitional adjustment on adoption of frs 26 – 3
fair value adjustments taken directly to reserves – 1
31 december 2 2
listed availableforsale financial assets have a market value of £2 million 2005 £2 million and they are held at a carrying value of £2 million 2005 £2 million
03 debtors
2006 2005
£m £m
amounts falling due within one year
amounts owed by group undertakings 1215 859
prepayments and accrued income 1 1
1216 860
amounts falling due after more than one year
deferred taxation see note 6 5 5
total debtors 1221 865
04 creditors amounts falling due within one year
restated
2006 2005
£m £m
amounts owed to group undertakings 4501 4074
term notes and commercial paper 122 22
current uk corporation tax – 3
accruals and deferred income 1 1
other creditors 53 59
total creditors amounts falling due within one year 4677 4159
2005 has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis of accounting’ on page 138
the impact of recognising these commitments is to increase other creditors at 31 december 2005 by £59 million
amounts owed to group undertakings are unsecured and repayable on demand interest on these amounts is charged at a commercial rate
05 creditors amounts falling due after more than one year
2006 2005
£m £m
term notes 173 5
derivative financial instruments 9 9
total creditors amounts falling due after more than one year 182 14
06 deferred tax
2006 2005
£m £m
1 january 5 3
profit and loss account – 2
31 december 5 5
the balance at 31 december is analysed as follows
2006 2005
£m £m
tax losses carried forward 8 5
future tax on the fair value of derivative financial instruments 3 –
net deferred tax balance 5 5 reuters group plc annual report and form 20f 2006
141
07 capital and reserves
called up capital share reserve profit and total
share redemption premium other for own loss shareholders’
capital reserve account reserves shares account funds
£m £m £m £m £m £m £m
1 january 2006 as previously stated 360 1 107 722 224 1076 2042
prior year adjustment – share buyback programme – – – – 59 – 59
1 january 2006 as restated 360 1 107 722 283 1076 1983
amounts receivable in respect of unissued shares – – – 12 – – 12
shares allotted during the year 7 – 34 9 – – 32
shares cancelled during the year 12 12 – – – – –
capital contributions in respect of share options – – – 39 – 27 12
loss for the financial year – – – – – 102 102
repurchase of own shares – – – – 467 – 467
shares to be repurchased – – – – 53 – 53
shares held by employee share ownership trusts – – – – 56 – 56
realisation of other reserve – – – 319 – 319 –
31 december 2006 355 13 141 445 859 1266 1361
shareholders’ funds at 1 january 2006 have been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability see ‘basis
of accounting’ on page 138 the impact of recognising these commitments is to increase creditors amounts falling due within one year and to decrease
shareholders’ funds by £59 million
the company’s profit for the financial year was £32 million 2005 £211 million this profit for the financial year mainly represents interest and revaluation on
intercompany borrowings fair value gains and losses on financial assets at fair value through profit and loss dividends received from reuters investments limited
offset by an impairment of the company’s investment in reuters investments limited during 2006 the company paid equity dividends to shareholders of £134
million 2005 £140 million
the reserve for own shares includes £750 million 2005 £224 million which represents the cost of 187 million shares in reuters group plc 2005 57 million
purchased in the market as part of the ongoing share buyback programme during 2006 the company assumed sponsorship of some of the reuters employee
share ownership trusts esots by purchasing the esot loans previously held by another group company consequently the reserve for own shares also includes
£56 million 2005 £nil which represents the cost of shares held in the esots sponsored by the company following the transaction at 31 december 2006 these
esots held 30 million shares in reuters group plc purchased in the market to satisfy certain optionsawards under the group’s share incentive plans at 31
december 2006 the market value of these shares was £134 million and 165 million shares were under option to employees
during 2006 reuters cancelled 48 million shares repurchased as part of the ongoing share buyback programme an amount equal to the nominal value of these
shares has been transferred from called up share capital to the capital redemption reserve
during 2006 a transfer has been made from nondistributable other reserves to the profit and loss account to offset the impairment of the company’s investment 
in reuters investments limited
08 share capital
2006 2005
£m £m
authorised
one founders share of £1 – –
2100 million ordinary shares of 25p each 525 525
525 525
allotted called up and fully paid
one founders share of £1 – –
ordinary shares of 25p each 355 360
355 360
number of ordinary shares of 25p each millions 1422 1441
shares allotted during the year in millions
28876537 shares in reuters group plc were issued under employee share schemes at prices ranging from 
£nil to 419p per share transaction costs incurred on issue of shares amounted to £nil 2005 £nil 29 6
following the approval of a high court scheme of arrangement the majority of the issued share capital of reuters holdings plc was acquired by reuters group
plc in february 1998
the rights attaching to the founders share are set out on pages 147–148
financials reuters group plc annual report and form 20f 2006
142 separate financial statements of reuters group plc
for the year ended 31 december 2006 continued
08 share capital continued
the following table provides a summary of the shares repurchased under the buyback programme from its announcement in july 2005 until december 2006
total number
of shares approximate
purchased value of shares
as part of that may yet
a publicly average price be purchased
announced paid per under the
month programme share £ programme £m
2005
july 1500000 389 994
august 8500000 370 962
september 7150000 373 936
october 2800000 353 926
november 22800000 389 836
december 14650000 408 776
2006
january 10500000 432 731
february 18450000 406 655
march 13725000 389 601
april 6000000 398 577
may 9435000 386 541
june 17750000 367 475
july 6770000 375 450
august 13000000 389 399
september 9750000 411 358
october 8725000 443 319
november 9500000 457 276
december 5594000 455 250
the current £1 billion share buyback programme was announced on 26 july 2005 and was due to run for two years based on current investment plans reuters
expects to increase the buyback during 2007 to £400–425 million which includes £250 million remaining of the £1 billion buyback no programme has expired
during the period covered by the table reuters has not determined to terminate any programme prior to expiration
the following table summarises information relating to the number of shares under option and those which were exercisable at 31 december 2006
exercisable
weighted options options options weighted
average exercisable at exercisable at exercisable at average exercise
total shares remaining 31 december 31 december 31 december price for options
under option contractual life 2006 2005 2004 exercisable at
range of exercise prices million months million million million 31 december 2006
ordinary shares
£000 – £200 286 33 68 25 25 £085
£201 – £500 366 66 171 120 92 £290
£501 – £700 57 58 57 51 142 £558
£701 – £900 36 54 36 46 37 £862
£901 – £1100 – – – 04 03 –
adss 
1001 – 3000 – – – 01 – –
3001 – 5000 11 24 – – – 4286
756 332 247 299
 one ads is equivalent to six ordinary shares reuters group plc annual report and form 20f 2006
143
09 post balance sheet events
during the period 1 january 2007 to 9 march 2007 the company purchased 155 million shares for total consideration of £68 million as a part of its ongoing share
buyback programme announced in july 2005
the following table provides a summary of the shares bought back during this period
total number
of shares approximate
purchased value of shares
as part of that may yet
a publicly average price be purchased
announced paid per under the
month programme share £ programme £m
january 5700000 443 225
february 6300000 432 197
march 3450000 430 182
included above are 120 million shares which the group has irrevocable commitments to purchase at 31 december 2006 in accordance with the company’s
accounting policy the cost of these shares £53 million has been recorded in the balance sheet at 31 december 2006 and reported as a current liability with 
a corresponding deduction from shareholders’ funds
on 1 march 2007 the company announced that it expects to increase the buyback during 2007 to £400–425 million which includes £250 million remaining of 
the £1 billion buyback announced in july 2005
a final dividend in respect of 2006 of 690p per ordinary share amounting to a total dividend of £86 million is to be proposed at the agm on 26 april 2007 
these financial statements do not reflect this proposed dividend payable
10 auditors’ remuneration
an analysis of fees payable by the company to the company’s auditors is set out below
2006 2005
£m £m
fees payable to the company’s auditor for the audit of the company’s annual accounts 22 29
fees payable to the company’s auditor and its associates for other services
the audit of the company’s subsidiaries pursuant to legislation 02 02
other services pursuant to legislation 05 –
total fees payable 29 31
the fees payable to the company’s auditor for the audit of the company’s annual accounts principally relates to fees payable for the audit of the reuters group plc
annual report and form 20f
11 employees and directors
the average number of employees including executive directors during the year was as follows
2006 2005
executive directors 3 3
the executive directors are tom glocer david grigson and devin wenig details of their emoluments pension arrangements longterm incentive plans and share
option plans are included in the remuneration report on pages 32–37 details of which form part of these financial statements
there are no other employees of the company
financials reuters group plc annual report and form 20f 2006
ordinary shares
as of 9 march 2007 there were 1242432092 ordinary shares outstanding excluding 30431547 ordinary shares held in employee share
ownership trusts and 138360000 held in treasury see note 33 on page 120
major shareholders
the company had received notice under section 198 of the uk companies act 1985 or under the transparency obligations directive
disclosure and transparency rules instrument 2006 dtrs dtr 5 as at 9 march 2007 that the following parties held notifiable interests in 
its shares or voting rights
144 information for shareholders
number of percentage of number of number of number of 
shares held on issued share shares held on shares held on shares held on
9 march 2007 capital 7 march 2006 2 march 2005 3 march 2004
schroders plc 99602990 78 – – –
valueact capital master fund lp  83551212 66–––
fidelity international limited  82177979 65 150753687  130364252 94238074
amvescap plc 62194192 49 – – –
blackrock inc  48978642 38 48978642 48978642 48978642
legal  general investment management 44901479 35 55230590 58006887 43076669
barclays plc 40069073 31 – 53902608 46046872
capital group of companies inc 39399900 31 42135514 – –
 shares held by fidelity investments
 formerly merrill lynch investment management
the company’s major shareholders do not have any different voting
rights from the other ordinary shareholders there have been some
changes in the holdings of the company’s major shareholders during
the last three years most notably fidelity no longer holds in excess of
10 of the company’s voting capital as was the case during 2005 and
2006 fidelity increased its holding throughout the year by a total of
approximately 3 but then sold approximately 6 at the beginning of
2007 the capital group of companies inc held around 3
throughout 2006 first notifying the company in january 2006 it fell
below the 3 notification threshold in january 2007 and notified the
company again in march 2007 of a 31 holding barclays plc legal
 general investments and blackrock inc previously merrill lynch
investment management have held notifiable holdings for the last
three years and continue to do so following the implementation of
the new dtrs on 20 january 2007 schroders plc valueact capital
master fund lp  and amvescap plc notified the company of their
voting rights in reuters shares
the founders share
independence integrity and freedom from bias in the gathering and
dissemination of news and information are fundamental to reuters
reuters founders share company limited the founders share
company was established to safeguard those qualities and holds a
single founders share this share may be used to outvote all ordinary
shares if other safeguards fail and there is an attempt to effect a
change in control of the company ‘control’ for this purpose means
30 of the ordinary shares the directors of the founders share
company have a duty to ensure as far as they are able by the proper
exercise of the powers vested in them that the reuters trust
principles are observed see pages 146–149
the founders share company’s directors are nominated by a
nomination committee which includes certain serving directors of the
founders share company one person nominated by each of four
news associations two people appointed by the chairman of reuters
group plc and two people appointed after consultation with the
european court of human rights a director of the founders share
company may not be a director or employee of reuters group
the current directors of the founders share
company are as follows
trustee since
the honourable mrs anson chan gbm cbe jp 2002
leonard berkowitz 1998
sir michael checkland 1994
bertrand collomb 2004
jiri dienstbier 2005
uffe ellemannjensen mp 2001
john fairfax am 2005
dr frene ginwala 2004
pehr gyllenhammar chairman 1997
alejandro junco de la vega 2006
joseph lelyveld 2004
sir christopher mallaby gcmg gcvo 1998
john mcarthur 2001
mammen mathew 2002
the right hon the baroness noakes dbe 1998
sir william purves cbe dso 1998
jaakko rauramo 1999
dr mark wössner 2001
founders share company directors are appointed for an initial term of
five years and must resign at the agm on or after the fifth anniversary
following appointment or reappointment trustees are eligible for 
reappointment for a further term of five years subject to a maximum
term of 15 years and maximum age limit of 75 except as described
above to the best of the group’s knowledge the company is not
directly or indirectly owned or controlled by another corporation 
by any foreign government or by any other natural or legal person
severally or jointly and currently there are no arrangements that may
at a subsequent date result in a change in control of the company reuters group plc annual report and form 20f 2006
corporate structure
the group conducts its business through a portfolio of companies
including wholly and partlyowned subsidiary undertakings joint
ventures and associates information concerning the most significant
companies is contained in note 39 to the consolidated financial
statements on page 128
trading markets
the company’s ordinary shares are traded on the london stock
exchange american depositary shares adss each representing six
ordinary shares are traded on the nasdaq stock market the adss
are evidenced by american depositary receipts adrs issued by
deutsche bank trust company americas as depositary under a
deposit agreement dated 18 february 1998 and supplemented 
16 december 2005 the deposit agreement among the company 
the depositary and adr holders
the table below sets out for the periods indicated i the reported
high and low sales prices for the ordinary shares based on the daily
official list of the london stock exchange and ii the reported high
and low sales prices of the adss on nasdaq
the london 
stock exchange nasdaq
pounds per share us dollars per ads
high low high low
annual market prices
2002 747 161 6436 1512
2003 268 096 2709 959
2004 429 241 4915 2572
2005 431 352 4935 3733
2006 475 349 5425 3851
quarterly market prices
2005
first quarter 428 364 4935 4083
second quarter 426 375 4865 4148
third quarter 412 359 4345 3903
fourth quarter 431 352 4440 3733
quarterly market prices
2006
first quarter 461 380 4844 3967
second quarter 410 354 4571 3867
third quarter 443 349 5006 3851
fourth quarter 475 431 5425 4820
monthly market prices
2006
august 404 377 4614 4250
september 443 398 5006 4485
october 461 431 5246 4820
november 475 441 5391 5015
december 463 437 5425 5120
monthly market prices
2007 475 349 5425 3851
january 456 432 5306 5070
february 445 424 5253 4955
march to 9 march 444 422 5166 4818
analysis of shareholders
as of 9 march 2007 there were 1242432092 reuters ordinary shares
in issue including the shares referred to below but excluding ordinary
shares held by employee share ownership trusts and shares held in
treasury there were 26506 shareholders on the ordinary share register
analysed in the chart below 
as of the same date 1004081 ordinary shares and 16199871 adss
representing 97199226 ordinary shares were held on the record in
the us these ordinary shares and adss were held by 946 record
holders and 2612 record holders respectively and represented or
evidenced adss respectively representing 77 respectively of the
total number of ordinary shares outstanding since certain of these
ordinary shares and adss were held by brokers or other nominees
the number of record holders in the us may not be representative 
of the number of beneficial holders or of where the beneficial holders
are resident
dividends
the table below sets forth the amounts of interim final and total
dividends excluding any associated uk tax credit discussed on page
150 paid in respect of each fiscal year indicated pound sterling
amounts per share have been translated into us cents per ads at the
actual rates of exchange used for each of the respective payments of
interim and final dividends
pence per share cents per ads
interim final total interim final total
2002 385 615 1000 3605 5846 9451
2003 385 615 1000 3608 6488 10096
2004 385 615 1000 4094 7024 11118
2005 385 615 1000 4118 6820 10938
2006 410 690 1100 4687 – –
see page 68 for a discussion of the group’s dividend policy
an interim dividend of 410 pence per ordinary share was paid on 
30 august 2006 the directors recommend a final dividend of 690
pence per ordinary share giving a total of 11 pence per ordinary share
for the year 2005 10 pence subject to shareholders’ approval at the
agm to be held on 26 april 2007 the final dividend will be paid on 
3 may 2007 to members on the register holding ordinary shares at the
close of business on 16 march 2007 it will be paid on 10 may 2007 to
ads holders on the register at the close of business on 16 march 2007
and will be converted into us dollars from sterling at the rate
prevailing on 10 may 2007
details of the changes in the authorised and called up share capital
are set out in note 27 on page 116
other 27
pension funds 21
adss  7
insurance companies 5
private investors 2
foreign governments 2
nonprofit organisations 1
investment trusts unit trusts 
and mutual funds 35
145 information reuters group plc annual report and form 20f 2006
history and development
the ultimate holding company for the group reuters group plc 
was incorporated in england and wales on 24 december 1996 though
its predecessor was formed in england in 1851 reuters group plc’s
registered office and corporate headquarters are located at the reuters
building south colonnade canary wharf london e14 5ep  uk
memorandum and articles 
of association
the following description summarises certain material rights of
holders of the company’s ordinary shares of 25 pence each and
material provisions of the company’s memorandum and articles of
association the articles the memorandum and articles of
association of reuters founders share company limited the
founders share company and english law the following description
is a summary only and is qualified in its entirety by reference to the
articles which have been filed with the sec and companies house
and the companies act 1985
all of the outstanding ordinary shares are fully paid accordingly no
further contribution of capital may be required from the holders of
such shares by reuters in this description the term ‘holder’ refers to
the person registered in the register of members as the holder of the
relevant share and the term ‘beneficial owner’ refers to a person other
than the holder who has a beneficial interest in the relevant share
deutsche bank which acts as depositary under the deposit
agreement relating to the adss is the holder of the ordinary shares
represented by the outstanding adss
general
reuters group plc is incorporated under that name and is registered
in england and wales with registered number 3296375 its objects are
set out in the fourth clause of its memorandum of association and
cover a wide range of activities including the following
• collecting information and supplying news and information services
and products
• acquiring and operating wireless installations satellites and other
means of communication
• utilising the group’s communications capabilities to provide various
financial and securities markets services and
• carrying on any other business supplemental to the foregoing or
capable of enhancing the group’s profitability or capitalising on the
group’s expertise
the memorandum of association provides a broad range of corporate
powers to effect these objectives
the reuters trust principles and the founders
share company
the articles contain two sets of restrictions relating to the ownership
of reuters shares these restrictions are intended to ensure continued
compliance with the following principles the reuters trust principles
set out in the article f114
• ‘that reuters shall at no time pass into the hands of any one interest
group or faction
• that the integrity independence and freedom from bias of reuters
shall at all times be fully preserved
• that reuters shall supply unbiased and reliable news services to
newspapers news agencies broadcasters and other media
subscribers and to businesses governments institutions individuals
and others with whom reuters has or may have contracts
• that reuters shall pay due regard to the many interests which 
it serves in addition to those of the media and
• that no effort shall be spared to expand develop and adapt the
news and other services and products of reuters so as to maintain
its leading position in the international news and information
business’
the first set of restrictions contained in the articles applies to persons
that become ‘interested’ in 15 or more of the ordinary shares
outstanding at any time excluding any shares held by reuters as
treasury shares the term ‘interested’ is defined in the articles by
reference to provisions of the companies act 1985 which require
persons to disclose to public companies interests in voting shares 
in excess of a prescribed percentage subject to certain exceptions 
all shares held by a person who reaches the 15 limit will be
disenfranchised and the shares exceeding the 15 limit must be
disposed of this set of restrictions is more fully described below under
‘rights and restrictions attaching to reuters shares – restrictions on
ownership – disenfranchisement and disposal of excess interests’
second the company’s share capital includes the founders share
which is held by the founders share company a company limited by
guarantee consisting of individuals who constitute both its members
and directors the founders share empowers the founders share
company to cast such number of votes as will pass any resolution
supported by and defeat any resolution opposed by the founders
share company if it believes that any person or persons have
obtained or are seeking to obtain control of the group control for
these purposes is defined as the ability to control the exercise of 30
or more of the votes that may be cast on a poll at general meetings
under the articles the special rights attaching to the founders share
may not be varied or abrogated in any respect without the prior written
consent of the founders share company the rights attaching to the
founders share are described in more detail below under ‘rights and
restrictions attaching shares – voting rights – rights conferred by
founders share’
the restrictions on interests in ordinary shares and the extraordinary
voting rights of the founders share may be characterised as anti
takeover provisions to the extent they may have the effect of
preventing a bid for control of the group tender offers or other non
market acquisitions of shares are usually made at prices above the
prevailing market price of a company’s shares acquisitions of shares
by persons attempting to acquire control through market purchases
may support the price of shares at market levels higher than otherwise
would be the case the restrictions and extraordinary voting rights
summarised in this section may be expected to preclude such offers
information for shareholders continued 146 reuters group plc annual report and form 20f 2006
directors
the company’s articles provide for a board of directors consisting of
not fewer than five nor more than 15 directors the articles require
that in performing their duties the directors have due regard for the
reuters trust principles insofar as by the proper exercise of their
powers and in accordance with their other duties as directors the
directors may do so
the articles contain provisions that require the board of directors to
include at least five nonexecutive directors before a new executive
director can be appointed
under the articles a director may not vote in respect of any contract
arrangement or proposal in which the director or any person
connected with the director has any material interest other than by
virtue of the director’s interests in securities of or otherwise in or
through the company this is subject to certain exceptions relating to
proposals a giving the director any guarantee security or indemnity
in respect of obligations incurred at the request of or for the benefit 
of the group b giving any guarantee security or indemnity to a third
party in respect of obligations of the group for which the director has
assumed responsibility under an indemnity or guarantee c relating
to an offer of securities of the group in which the director may be
entitled to participate or will be interested as an underwriter d
concerning any other company in which the director is beneficially
interested in less than 1 of the issued shares of any class of the
company or the voting rights available to its shareholders e relating
to the adoption modification or operation of any employee benefits
plan which will provide the director with the same benefits as other
employees and f relating to any liability insurance that reuters is
empowered to purchase for its directors or employees in respect of
actions undertaken as directors or officers of the group
the directors are empowered to exercise all the powers of the group
to borrow money subject to the limitation that the aggregate
principal amount outstanding in respect of monies borrowed by the
group shall not exceed a sum equal to two and a half times the
company’s share capital and aggregate reserves calculated in the
manner described in the articles and £5000 million unless sanctioned
by an ordinary resolution of the company’s shareholders
at each agm of reuters shareholders at least onethird of the
directors or if their number is not a multiple of three the number
nearest to but not greater than onethird shall retire from office by
rotation the directors to retire by rotation at the agm include any
director who is due to retire at the meeting by reason of age as
prescribed in section 293 of the companies act 1985 namely 70 years
old a retiring director shall be eligible for reelection subject to the
requirements of the combined code since the 2005 agm the board
has asked all directors to stand for reelection on an annual basis for
additional information see ‘statements of directors’ responsibilities
and compliance’ on page 40 the amended articles for which
shareholder approval is being sought at the 2007 agm remove the
requirement that a director should retire when he reaches the age 
of 70 in order to comply with the new employment equality age
regulations 2006
directors are not required to hold shares in order to qualify as a
director a director not holding any shares may nevertheless attend
and speak at general meetings of the company for further
information on reuters personal shareholding policy refer to the
‘remuneration report’ on page 30
rights and restrictions attaching to shares
dividends
holders of ordinary shares are entitled to participate in the payment
of dividends pro rata to their holdings the founders share is not
entitled to participate in the payment of dividends nor will any
dividend be paid on any shares held by reuters in treasury the board
may propose and pay interim dividends and recommend a final
dividend in respect of any accounting period out of the profits
available for distribution under english law
a final dividend may be declared by the shareholders in general
meeting by ordinary resolution but no dividend may be declared 
in excess of the amount recommended by the board
the company may allot ordinary shares in lieu of cash dividends
subject to shareholder approval at the time the relevant dividend is
declared in addition the company may declare and pay equivalent
dividends to shareholders outside the united kingdom in local
currencies and pay such dividends to the depositary for value on the
payment date
voting rights
rights conferred by ordinary shares voting at a general meeting of
shareholders is by show of hands unless before or on making known
the result a poll is demanded in accordance with the articles if voting
is by show of hands each holder of ordinary shares who is present in
person has one vote on a poll every holder of ordinary shares who is
present in person or by proxy has one vote for every ordinary share
held voting on all resolutions is carried out by way of a poll
the company now chooses to put all resolutions at the agm to 
a poll vote
holders of a substantial number of ordinary shares may be
disenfranchised under the circumstances described under ‘restrictions
on ownership’ below
rights conferred by the founders share the founders share confers
upon the founders share company the right to cast such number of
votes as are necessary to defeat any resolution which would vary or
abrogate the rights of the founders share the articles provide that
the alteration of specified articles relating to the founders share and
the reuters trust principles are deemed to constitute a variation of 
the rights of the founders share in addition any resolution proposing
the winding up of the group voluntarily by the court or any
reconstruction of the group or any resolution which would attach to
any share voting rights not identical in all respects with those of the
ordinary shares is deemed to be a variation of the rights of the
founders share
additionally if there are in the opinion of the founders share
company reasonable grounds for believing that any person and his
associates have obtained or are attempting to obtain directly or
indirectly control of reuters the founders share company is entitled
in its absolute discretion to serve reuters with a written notice a
founders share control notice to that effect control is defined for
these purposes as the ability to control the exercise of 30 or more 
of the votes which may be cast on a poll at a general meeting at all
times after the service of a founders share control notice and
pending its rescission the founders share confers upon the founders
share company the right to cast on a poll such number of votes as are
necessary to ensure the effective passing of any resolution in favour of
which it votes and to ensure the defeat of any resolution against which
it votes the articles provide that the opinion of the founders share
company in respect of the service or rescission of a founders share
147 information reuters group plc annual report and form 20f 2006
control notice shall be final and binding and may not be challenged
on any grounds whatsoever
the founders share company is entitled at any time to serve reuters
with a written request for an extraordinary general meeting and the
directors are obliged to comply with such request if they do not
comply the founders share company is entitled to convene an
extraordinary general meeting if a founders share control notice 
has been served however the founders share company can convene
an extraordinary general meeting without first requesting that the
directors do so four founders share company directors present at
the relevant founders share company directors meeting can bind all
the founders share company directors to exercise the voting rights
attaching to the founders share so as to defeat a resolution that
would be deemed to be a variation of the rights attached to the
founders share however the vote of a majority of the founders
share company directors the chairman of the founders share
company having a casting vote in the event of equality of votes 
is required to determine whether a founders share control notice
should be served and if so the manner in which the voting rights
attaching to the founders share shall be exercised excluding the vote
of any founders share company directors who is associated with or
materially financially interested in the person attempting to obtain
control of reuters
restrictions on ownership
ordinary shares under the articles a person is ‘interested’ in shares 
if among other things he is interested directly or through his family
or one or more companies or through an interest in association with
others pursuant to an agreement or understanding or through a trust
or if he controls the voting rights of others the definition of ‘interest
in shares’ in the articles is made by reference with specified
variations to certain provisions of the companies act 1985
disclosure of interests in ordinary shares the articles provide for the
disclosure of interests in reuters ordinary shares by reference to the
companies act 1985 provisions mentioned above with specified
variations under these provisions as currently in force if a person
acquires an ‘interest’ in voting shares of a public company amounting 
to 10 or more of the voting shares of any class or if he increases or
reduces such holding by at least 1 or if he ceases to have such holding
he is obliged to notify the company within two days of the day on which
he acquired 10 or any such change in his interest took place further if
his interest is a ‘material interest’ the 10 referred to above is reduced 
to 3
the articles provide for disenfranchisement of shares which are the
subject of a notice under section 212 of the companies act 1985
which allows a company to require disclosure of certain details
concerning ownership of its shares if the person served with the
notice is in default in answering it the articles also provide for the
imposition of restrictions on transferability of the shares concerned
and on the right to receive dividends if such shares represent at least
025 of the class concerned such restrictions cannot however be
imposed until the expiry of 14 days after the date of the section 212
notice any such restrictions cease if the shares concerned are sold
pursuant to a takeover offer or to an unconnected third party or
through the london stock exchange the restrictions on transferability
only apply to certificated shares where a holder of uncertificated
shares is in default in answering a section 212 notice the articles
provide that the founders share company may require the group’s
directors to apply to the court for such order as may be appropriate
disenfranchisement and disposals of excess interests subject to
certain exceptions described below certain restrictions apply to
persons that become ‘interested’ as defined in the articles in 15 or
more of the ordinary shares if any person becomes interested in 15
or more of the outstanding shares excluding any shares held by
reuters as treasury shares the ‘relevant shares’ the directors are
required to serve a restriction notice on that person on any other
person known to the directors to have an interest in the relevant
shares and if different on the registered holder of the relevant
shares while a restriction notice in respect of relevant shares is in
force a registered holder of the relevant shares is not entitled to
attend or vote either in person or by proxy at any general meeting 
or at any meeting of the holders of any class of reuters shares in
addition a restriction notice will require such person to dispose of any
relevant shares exceeding the 15 limit and supply evidence to the
company that such disposal has occurred within 21 days or such longer
period as the directors consider reasonable if such disposition is not
made within the specified period the directors must as far as they are
able dispose of any shares exceeding the 15 limit under the
articles any belief resolution decision or action of the directors held
made or taken pursuant to any of the provisions concerning restrictions
on ownership shall be conclusive final and binding on all persons
concerned and may not be challenged on any grounds whatsoever
the restrictions are subject to certain modifications where a person
becomes interested in 15 or more of the issued shares of any class
by reason of a rights issue or an underwriting in the ordinary course 
of its business
the founders share ownership of the founders share is restricted to
the founders share company under its memorandum of association
the founders share company is not permitted directly or indirectly 
to dispose of the founders share or of any interest therein or to grant
any rights in respect of the founders share or any interest therein
treasury shares reuters may acquire and thereafter hold up to 10 of
its issued listed share capital in treasury any such acquisition must be
financed from the distributable profits of reuters subject to certain
limited exceptions the rights attaching to shares while held in treasury
will be suspended treasury shares may only be subsequently
disposed of by reuters by way of cash sale transfer for the purposes
of or pursuant to an employees’ share scheme or cancellation
preemptive rights new issues of shares sale of treasury
shares and repurchase of shares
holders of ordinary shares have no preemptive rights under the
articles however the ability of the directors to cause the company 
to issue shares securities convertible into shares or rights to shares 
or to sell treasury shares otherwise than pursuant to an employee
share scheme is restricted
under the companies act 1985 the directors are with certain
exceptions unable to allot any equity securities without express
authorisation which may be contained in the articles or given by its
shareholders in general meeting but which in either event cannot last
for more than five years the companies act 1985 imposes further
restrictions on the issue of equity securities for cash or sale of 
treasury shares for cash other than by offering them first to existing
shareholders unless the statutory requirement is displaced or modified
by the shareholders in general meeting or under the company’s
articles
at reuters agm to be held on 26 april 2007 a resolution will be
proposed to authorise the directors to allot relevant securities as
defined in the companies act 1985 including any equity securities 
up to an aggregate nominal amount of £105 million until the earlier 
to occur of the agm in 2008 or 26 july 2008 a resolution will also be
information for shareholders continued 148 reuters group plc annual report and form 20f 2006
proposed to authorise equity securities as defined in the companies
act 1985 to be issued within this limit by way of a rights offer or
otherwise pro rata to existing shareholders but other issues of 
equity securities except for shares issued pursuant to employee 
share schemes will be limited to an aggregate of £16 million in
nominal value
subject to applicable provisions of english law the company may
purchase its ordinary shares currently it has general authority to
repurchase up to 207 million ordinary shares at the reuters agm on
26 april 2007 a resolution will be proposed to renew this authority up
to a maximum of 192 million ordinary shares at prices ranging from 25
pence and not more than the higher of 5 above the average market
value of the ordinary shares for the five business days prior to the day
the purchase is made or the price stipulated by article 51 of the buy
back and stabilisation regulation namely the higher of the price of
the last independent trade and the highest current independent bid
on trading venues where the purchase is carried out
during 2006 reuters continued to operate the £1 billion share 
buyback programme it announced on 26 july 2005 during 2006
129200000 shares with a nominal value of £32300000 representing
9 of calledup share capital were repurchased at a cost of
£526 million 48 million of these shares were cancelled in future 
share buybacks will be considered periodically based on business
performance investment opportunities and maintaining a strong
investment grade credit rating
rights in a winding up
if reuters group plc is wound up the liquidator may with the authority
of an extraordinary resolution divide among the holders of ordinary
shares and the founders share pro rata to their holdings reuters
assets after satisfaction of liabilities to creditors provided however
that the founders share company may receive up to £1 and no more
variation of rights and alteration of share capital
if at any time the company’s share capital is divided into different
classes of shares the rights attached to any class may be varied
subject to the provisions of the companies act 1985 with the consent
in writing of holders of threequarters in value of the shares of that
class or upon the adoption of an extraordinary resolution passed at 
a separate meeting of the holders of the shares of the class at every
such separate meeting all of the provisions of the articles relating 
to proceedings at a general meeting apply except that the quorum 
is to be the number of persons which must be two or more who hold
or represent by proxy not less than onethird in nominal value of the
issued shares of the class
the company can increase its share capital by ordinary resolution in
conformity with the provisions of the companies act 1985 however
new shares cannot have voting rights which are not identical to those
of ordinary shares without the prior written consent of the founders
share company furthermore the company may issue shares with
preferred and other special rights or restrictions provided that the
prior written consent of the founders share company has been sought
for issuing any shares with rights not identical to those of ordinary
shares the company can consolidate divide and cancel any of its
shares other than the founders share by extraordinary resolution 
and can reduce its share capital other than the founders share
agms and extraordinary general meetings egms
agms must be convened upon advance written notice of 21 days 
an extraordinary general meeting must be convened upon advance
written notice of 21 days for the passing of a special resolution and
14 days for any other resolution depending on the nature of the
business to be transacted the notice must specify the nature of the
business to be transacted if it is other than routine business or if an
extraordinary or a special resolution is proposed the notice may also
specify a time not more than 48 hours prior to the time fixed for the
meeting by which a person must be entered on the company’s
register in order to have the right to attend and vote at the meeting
limitations on voting and shareholding
there are no limitations imposed by english law or the company’s
articles on the right of nonresidents or foreign persons to hold or
vote ordinary shares or adss other than the limitations that would
generally apply to all of reuters shareholders
exchange control
under english law and the articles persons who are neither residents
nor nationals of the uk may freely hold vote and transfer their
ordinary shares in the same manner as uk residents or nationals
there are currently no uk foreign exchange control restrictions on
remittances of dividends to nonresident holders of ordinary shares 
or on the conduct of reuters operations
exchange rates
the following table sets out for the periods indicated the average or
the high and low noon buying rates for pounds sterling in us dollars
per £1
fiscal year ended
31 december average  month high low
2002 151 august 2006 191 187
2003 164 september 2006 191 186
2004 184 october 2006 190 185
2005 183 november 2006 196 189
2006 186 december 2006 198 195
2007 to 9 march 196 january 2007 198 193
february 2007 197 194
 the average exchange rates have been calculated using the noon buying rates on the last
trading day of each calendar month during the period
on 9 march 2007 the noon buying rate was 193 per £1
fluctuations in the exchange rate between the pound sterling and the
us dollar will affect the us dollar amounts received by holders of the
adss upon conversion by the depositary of cash dividends paid in
pounds sterling on the ordinary shares represented by the adss also
fluctuations in the exchange rate may affect the relative market prices
of the adss in the us and the ordinary shares in the uk for the effect
on the group’s results of operations of fluctuations in the exchange
rates between the pound sterling and the other major currencies
including the us dollar in which revenues are received and expenses
are incurred see the ofr on page 54
149 information reuters group plc annual report and form 20f 2006
taxation information for us
shareholders
the following discussion of taxation is intended only as a descriptive
summary and does not purport to be a complete technical analysis or
listing of all potential tax effects relevant to a decision to acquire the
company’s ordinary shares or adss this is a summary of the material
us federal income tax and uk tax consequences of the ownership of
ordinary shares or adss by a us holder who holds the ordinary shares
or adss as capital assets the summary does not take into account
the specific circumstances of any particular investors some of which
may be subject to special rules such as dealers in securities us
holders who hold directly or indirectly 10 or more of the voting stock
or us holders who elected to apply the provisions of the former
income tax convention between the united states and the united
kingdom in addition the summary is based in part upon the
representations of the depositary and the assumption that each
obligation in the deposit agreement and any related agreement will
be performed in accordance with its terms the summaries of us and
uk tax laws are based on the internal revenue code of 1986 as
amended its legislative history existing and proposed regulations
published rulings and court decisions current tax laws current uk
revenue and customs published practice and the terms of the ukus
double tax treaty which came into effect on 31 march 2003 the
treaty as appropriate all of which are subject to change at any time
possibly with retrospective effect
for the purposes of this discussion a ‘us holder’ is any beneficial
owner of ordinary shares or adss that is i a citizen or resident for tax
purposes of the us ii a corporation organised under the laws of the
us or any us state iii an estate the income of which is subject to us
federal income tax without regard to its source or iv a trust if a court
within the us is able to exercise primary supervision over the
administration of the trust and one or more us persons have the
authority to control all substantial decisions of the trust
taxation of dividends
uk taxation
under current uk taxation legislation no withholding tax will be
deducted from dividends paid by the company a shareholder that is
a company resident for uk tax purposes in the uk will not generally
be taxable on any dividend it receives from the company a
shareholder who is an individual resident for tax purposes in the uk 
is entitled to a tax credit on cash dividends paid by the company on
ordinary shares or adss equal to oneninth of the cash dividend or
10 of the dividend plus the tax credit such shareholders will be
taxable on the total of the dividend and the related tax credit which
will be regarded as the top slice of the shareholder’s income the tax
credit may be set off against a uk resident individual shareholder’s
total income tax liability but no cash refund will be available a us
holder as defined above will not be entitled to any tax credit from
the uk revenue and customs in respect of a dividend from the
company although there will be no further uk tax to pay in respect 
of that dividend
us federal income taxation
the gross amount of any dividend paid by the company to a us
holder will generally be subject to us federal income taxation such 
a dividend will not be eligible for the dividendsreceived deduction
generally allowed to us corporations with respect to dividends from
other us corporations the amount of the dividend to be included 
in income will be the us dollar value of the pound sterling payments
made determined at the spot pound sterlingus dollar rate on the
date of the dividend distribution regardless of whether the payment
is in fact converted into us dollars
qualified dividend income
an individual us holder’s ‘qualified dividend income’ is subject to tax
at a reduced rate of 15 provided that the shares or adss are held for
at least 61 days of the 121 day period beginning on the date which is
60 days before the exdividend date and the holder meets other
holding period requirements dividends will not however qualify for
the reduced rate if the dividendpaying corporation is treated for the
tax year in which dividends are paid or for the prior year as a
‘passive foreign investment company’ a pfic for us federal income
tax purposes the company does not believe it is a pfic or was a pfic
for 2006 accordingly the company considers that dividends paid with
respect to the shares or adss will be ‘qualified dividend income’ and
subject to the us holder’s satisfaction of the holding period
requirements described above should be eligible for the reduced
15 us federal income tax rate the company dividends generally will
be foreign source passive income for us foreign tax credit purposes
taxation of capital gains
uk taxation
upon a sale or other disposal by a holder of ordinary shares or adss
a gain or loss may be recognised for uk capital gains tax purposes
equal broadly to the difference between the sterling value of the
disposal proceeds and the holder’s tax basis in the relevant ordinary
shares or adss and subject to the availability of any applicable
exemptions under the treaty capital gains on disposals of ordinary
shares or adss will generally be subject to tax only in the jurisdiction
of residence of the relevant holder as determined for the purposes of
the treaty unless the ordinary shares or adss are held as part of the
business property of a permanent establishment of that holder in the
uk in which case such capital gains may be subject to tax in both
jurisdictions the treaty also contains an antiavoidance rule which will
be relevant to individuals who are residents of either the uk or the us
and who have been resident of the other jurisdiction the us or the
uk as the case may be at any time during the six years immediately
preceding the relevant disposal of shares or adss the treaty
provides that in such circumstances capital gains arising from 
the disposal may be subject to tax not only in the jurisdiction of 
which the holder is resident at the time of the disposal but also 
in that other jurisdiction
information for shareholders continued 150 reuters group plc annual report and form 20f 2006
additional tax considerations
uk inheritance tax
an individual who is domiciled in the us for the purposes of the
ukus estate and gift tax convention the convention and who 
is not a national of the uk for the purposes of the convention will
not generally be subject to uk inheritance tax in respect of ordinary
shares or adss on the individual’s death or on a transfer of ordinary
shares or adss during the individual’s lifetime provided that any
applicable us federal gift or estate tax is paid however such an
individual will be subject to uk inheritance tax if the ordinary shares
or adss are part of the business property of a permanent
establishment of the individual in the uk or pertain to a fixed base in
the uk of an individual who performs independent personal services
special rules apply to ordinary shares or adss held in trust in the
exceptional case where the disposition is subject both to uk
inheritance tax and to us federal gift or estate tax the convention
generally provides for any tax paid in the uk to be credited against
tax liable to be paid in the us or for tax paid in the us to be
credited against the tax payable in the uk based on priority rules set
out in the convention
uk stamp duty and stamp duty reserve tax
no uk stamp duty or stamp duty reserve tax sdrt will be payable
on the transfer of an ads or agreement to transfer an ads provided
that the instrument of transfer or written agreement is executed and
retained outside the uk and does not relate to any matter or thing
done or to be done in the uk uk stamp duty will generally be
payable on conveyances or transfers of ordinary shares at the rate 
of 05 of the amount or value of the consideration if any for the
transfer rounded up to the next multiple of £5 sdrt will be
imposed at the rate of 05 of the amount or value of the
consideration for the transfer if an agreement is made for the transfer
of ordinary shares unless an instrument of transfer of the ordinary
shares in favour of the purchaser or its nominee is executed and duly
stamped within six years of the day that the agreement is made or in
a case where the agreement is conditional the day that the condition
is satisfied in which case any sdrt paid will be repaid together with
interest where the sdrt is not less than £25 on a claim for repayment
or to the extent not paid the charge to sdrt will be cancelled sdrt
is in general payable by the purchaser of ordinary shares but there are
regulations which provide for collection from other persons in certain
circumstances including from crest where the relevant ordinary
shares are held in crest uk stamp duty or sdrt will generally be
imposed on any instrument transferring ordinary shares to a person 
or to a nominee or agent for such a person whose business is or
includes issuing depositary receipts such as the adss for relevant
securities in these circumstances stamp duty or sdrt will be charged
at the rate of approximately 15 of the amount or value of the
consideration for the conveyance or transfer on sale or otherwise
15 of the value of the security transferred at the date the instrument
is executed
a transfer into crest will not be subject to this charge a transfer 
of ordinary shares from a depositary or its agent or nominee to a
transferee which results in the cancellation of the ads which
cancellation is liable to stamp duty as a ‘conveyance or transfer on
sale’ because it completes a sale of such ordinary shares will be liable
to ad valorem stamp duty at the rate of 05 of the amount or value
of the consideration if any for the transfer a transfer of ordinary
shares from a depositary or its agent or nominee to the ads holder
which results in cancellation of the ads but where there is no transfer
of beneficial ownership is not liable to duty as a ‘conveyance or
transfer on sale’ but will be liable to a fixed stamp duty of £5
us pfic status
if a foreign company is a pfic based on either an income test or 
an asset test then certain distributions and gains can be allocated
rateably over a us shareholder’s holding period with the effect that
the amount allocated to the current taxable year and any taxable year
before the company became a pfic would be taxable as ordinary
income in the current year and the amount allocated to other taxable
years would be taxed at the highest rate in effect for that year on
ordinary income the tax is also subject to an interest charge to
recover the deemed benefit from the deferred payment of the tax
attributable to each such year as referred to under the heading
‘taxation of capital gains – us federal income taxation’ the 
company reasonably believes that it was not a pfic in 2006 and 
does not anticipate becoming a pfic however the tests for
determining pfic status are applied annually and it is difficult to 
make accurate predictions of future income and assets which are
relevant to this determination accordingly we cannot assure us
holders that the irs would agree with our belief nor can the company
assure us holders that it will not become a pfic us holders are 
urged to consult their own tax advisors about the pfic rules including
the consequences to them of making a marktomarket election with
respect to our ordinary shares and adss in the event that we qualify
as a pfic
us information reporting and backup withholding
a us holder is generally subject to information reporting requirements
with respect to dividends paid in the us on ordinary shares or adss
and disposal proceeds realised from the sale exchange redemption
or other disposal of ordinary shares or adss in addition a us holder
is subject to backup withholding currently at a rate of 28 on
dividends paid in the us on ordinary shares or adss and disposal
proceeds realised from the sale exchange redemption or other
disposal of ordinary shares or adss unless the us holder is a
corporation provides an irs form w9 or otherwise establishes a
basis for exemption backup withholding is not an additional tax the
amount of any backup withholding will be allowed as a credit against
a us holder’s us federal income tax liability and may be refunded
provided that certain information is furnished to the irs
material contracts and transactions
fxmarketspace
on 4 may 2006 reuters and cme entered into an agreement to form
fxmarketspace a 5050 joint venture to create a centrallycleared
global foreign exchange trading system the joint venture was formed
on 20 july 2006 under the joint venture agreement reuters and cme
have committed to invest up to 45 million each subject to the joint
venture meeting certain performance milestones reuters and cme
each have an equal number of representatives on the board of
directors and board actions generally require approval of at least 
one representative of each party
the parties agreed to share all profits derived from the joint venture
including those profits derived through the provision of services by
the parties to the joint venture in proportion to their ownership
interest this is achieved by the joint venture paying a preferential
dividend to the shareholder with the lesser profits subject to accrual
in years during which the joint venture does not have sufficient profits
and to the other shareholder making direct payment of its portion 
of any accrued amount where either party is exiting from the joint
venture in certain circumstances
151 information reuters group plc annual report and form 20f 2006
the joint venture agreement contains limited transfer putcall and
termination provisions including termination rights if certain volume
and financial thresholds are not met in the fifth year after public
launch of trading subject to a call right of the nonterminating
partner putcall rights by the nondefaulting party in the event of
certain key defaults and transfer rights including the right to transfer
an interest in or require the sale of the entire joint venture beginning
only after ten years following public launch of trading and subject to 
a right of first refusal by the other partner
subject to certain exceptions cme and reuters each agreed not to
operate have any significant interest in or provide certain key services
to a competing cleared platform for electronic trading of fx
products other than futures and futures options if the venture
requires funding beyond the committed amounts and only one
partner is willing to provide such funding the other party will have 
a right to terminate these restrictions subject to a call right of the 
nonterminating party
reuters has entered into agreements to provide trading access to 
and trade notification services for and distribute market data from
fxmarketspace among various other services and arrangements 
for further information see note 34 on pages 123–124
radianzbt
sale of radianz to bt on 29 april 2005 reuters sold radianz to bt
for cash consideration of 175 million £95 million plus any cash
remaining on the balance sheet net of working capital adjustments 
at the date of completion the purchase agreement included standard
warranties and indemnities from reuters and was otherwise generally
on customary terms and conditions for a transaction of this nature as
a result of the sale of radianz to bt funding obligations from reuters
to radianz of 44 million were novated to bt
network services agreement reuters entered into a contract with bt
effective 29 april 2005 under which bt became a supplier of network
services to reuters under this network services agreement which has
since been amended bt provides and manages secure data networks
for reuters products and services worldwide and reuters is currently
expected to spend in the region of 3 billion from 2005 through 2013
the agreement sets out the responsibilities of the parties to achieve
the migration of all existing connections to bt’s new ip network and
contemplates completion of substantially all existing connections in
the second quarter of 2008 although a limited number of countries
will be completed in 2010 liquidated damages will be payable on 
a sliding scale if a party fails to achieve its migration responsibilities
the agreement contains minimum spend commitments for each year
following completion of the migration based on a declining
percentage of the charges in the previous year and obliges bt to
meet certain quality of service levels in addition the agreement gives
bt the opportunity to tender for any future telecommunication
services needed by reuters
savvis network services agreements
reuters is party to a threeyear network services agreement dated 
19 may 2005 with savvis for internet protocol network services internet
access colocation and other services the agreement contains no
minimum spend commitments and obliges savvis to meet certain
quality of service levels in addition on 3 june 2005 in connection with
the acquisition of the telerate business reuters acquired telerate’s
agreement with savvis for the provision of internet protocol network
services internet access colocation and other services to support the
acquired telerate business the agreement expires 1 october 2009
and is an exclusive arrangement for the telerate business so long as
savvis remains in material compliance with its obligations
sale of factiva
on 18 october 2006 reuters agreed to sell the majority of its 50
stake in factiva to dow jones the sale occurred on 15 december
2006 and reuters received cash consideration of 178 million reuters
retained a minority preference share interest valued at 7 million in 
a factiva entity in connection with the sale reuters entered into or
continued a number of commercial arrangements with factiva and
dow jones and agreed not to compete with factiva’s core business
for a twoyear period and to continue exclusivity arrangements with
respect to certain reuters content provided to factiva
sale of instinet group
on 22 april 2005 instinet group and nasdaq entered into a
definitive agreement for nasdaq to acquire instinet group for
approximately 188 billion in cash in connection with the transaction
reuters entered into an agreement with nasdaq agreeing to vote 
its 62 interest in instinet group in favour of the acquisition at the
same time instinet group agreed to sell its lynch jones  ryan ljr
subsidiary to the bank of new york and nasdaq agreed to
subsequently sell instinet the institutional brokerage business to
silver lake partners the sale of ljr to the bank of new york was
completed on 30 june 2005 and the sales of instinet group to
nasdaq and of the instinet brokerage business to silver lake
partners were completed on 8 december 2005 reuters received an
aggregate of approximately 113 billion for its 62 interest including
a dividend instinet group had made to its shareholders from the sale
of ljr which was deducted from the nasdaq purchase price
pension plan deficit funding
on 24 may 2006 reuters announced that it had agreed a package of
measures with the trustees of its two uk final salary pension plans that
will substantially fund the pension deficit enhance the security of the
members’ existing benefits and reduce the risk associated with
managing the plans under the agreement in addition to its ordinary
pension contributions reuters paid a cash sum of £187 million into
the two pension funds in 2006 and will pay a further £42 million in
2007
financing arrangements
for a discussion of other material contracts see ‘treasury policies’ 
on pages 63–65
information for shareholders continued 152 reuters group plc annual report and form 20f 2006
capital investments expenditure 
and divestments
during the last three years reuters has made a number of
acquisitions and invested in new businesses the principal
acquisitions investments and disposals none of which exceeded
£50 million save where otherwise stated were
acquisitions
2006
application networks inc a leading risk management software
provider in june 2006 for £22 million
the telerate distribution business of indian quotation systems private
limited in june 2006
telerate italia srl a distributor of telerate’s products in italy in 
july 2006
in july 2006 reuters and the chicago mercantile exchange formed
a new joint venture fxmarketspace limited to create a centrally
cleared global foreign exchange trading system reuters invested 
£8 million in the joint venture during 2006 an additional £6 million 
was invested by each partner in early 2007
in october 2006 reuters acquired a 26 interest in times global
broadcasting company limited for £11 million relating to the launch
of a new indian tv news channel times now in association with
the times of india
in november 2006 reuters acquired an interest in pluck corporation
an early stage social media solutions company for £4 million
total capital expenditure including transaction fees for acquisitions 
of subsidiaries joint ventures associates and availableforsale
financial assets during 2006 was £68 million
2005
telerate a leading financial information provider in the fixed income
sector in june 2005 for £79 million in cash plus reuters investment 
in savvis convertible preference shares valued at £31 million
quick telerate corp a distributor of telerate’s products in japan 
in june 2005
image group limited trading as action images a media company 
in the sports pictures market in september 2005
ecowin ab a data provider specialising in global and macroeconomic
data in november 2005
tremont capital management’s tass research hedge fund database
and the hedgeworld group in march 2005
in june 2005 reuters and nasdaq announced the formation of a
new joint venture independent research network inc to provide and
distribute equity research to the analyst community reuters invested
£1 million in the joint venture during 2005
total capital expenditure including transaction fees for acquisitions of
subsidiaries joint ventures associates and availableforsale financial
assets during 2005 was £145 million
2004
fitzrovia international plc a leading investment fund research
company was acquired in october 2004 by lipper limited a wholly
owned subsidiary of reuters
radianz a network servicesfinancial extranet company in which
reuters acquired the 49 voting interest it did not already own from
joint venture partner equant in november 2004 for £60 million
total capital expenditure including transaction fees for acquisitions of
subsidiaries joint ventures associates and availableforsale financial
assets during 2004 was £80 million
divestments
2006
reuters disposed or closed a total of three units during 2006 for cash
consideration of £80 million net of transaction fees the principal
disposal or closure was
factiva a provider of a broad range of archived news and business
information in which reuters 50 stake was sold to joint venture
partner dow jones for net cash consideration of £79 million
2005
reuters disposed or closed a total of five units during 2005 for cash
consideration of £895 million net of transaction fees the principal
disposals or closures were
instinet group in which reuters 62 stake was sold for £612 million 
in december 2005 prior to the sale reuters had sold bridge trading
company a soft dollar execution broker to instinet for approximately
38 million shares of instinet stock valued at £12 million instinet had
also disposed of its whollyowned subsidiary ljr in july 2005 for total
consideration of £96 million and its 2 interest in archipelago
holdings llc in may 2005
radianz was sold to bt for total consideration of £115 million in 
april 2005
tsi in which reuters reduced its stake from 88 to below 1 
by 31 december 2005 for total consideration of £63 million
deutsche gesellschaft für adhocpublizitat gmbh dgap a media
company in which reuters 33 stake was sold in november 2005
2004
reuters disposed of or closed a total of 12 units during 2004 for cash
consideration of £474 million net of transaction fees the principal
disposals or closures were
tsi in which reuters reduced its stake from 484 to 88 in february
2004 through completion of a public offering of 69 million tsi shares
and sale of an additional 17 million shares back to tsi for aggregate
net proceeds of £310 million
gl trade a financial software company in which reuters 342
shareholding was divested in june 2004 for consideration of £59
million
ort sas a wholly owned credit rating subsidiary of reuters was sold
in june 2004 for consideration of £29 million
towergroup a financial services research company in which reuters
held a 98 holding was sold in february 2004
153 information reuters group plc annual report and form 20f 2006
yankee a wholly owned telecommunications research company was
sold in may 2004
riskmetrics a company specialising in portfolio credit risk evaluation
in which reuters 24 stake was divested in january and june 2004
reuters remaining greenhouse fund investment portfolio was sold in
june 2004 to a company established by rvc the independent fund
management company created by former reuters employees in 2001
to manage the greenhouse fund
property plant and equipment
during 2005 the group’s principal facilities were relocated to the
canary wharf area of london thereby downsizing its londonbased
operations from 340000 sq ft to 281000 sq ft the canary wharf
building is leased through 2020
reuters other significant sites include
• the us headquarters at 3 times square in new york city 692000 sq
ft of which 288000 sq ft are sublet see below
• technical centres in
• london 324000 sq ft owned
• hazelwood missouri 109000 sq ft leased through 2024 with
options to extend through 2039
• geneva 144000 sq ft owned on property leased through 2095
which also includes the regional office for emea
• singapore 180000 sq ft owned on property leased through 2020
with options to extend through 2050 which also includes the
regional office and main data centre for asia and
• hauppauge new york 50000 sq ft owned
• an office facility in hauppauge 140000 sq ft owned used by
development and internal support groups which is located next 
to reuters hauppauge data centre
• four adjacent corporate office buildings located in st louis county
missouri total 211000 sq ft two of which are owned and two of
which are leased through 2014 with options to extend through 2034
• office space in bangkok 178000 sq ft under lease expiring for
most of the space in 2007
• space in three office buildings in bangalore india total 212622 sq
ft under leases expiring in 2008 2009 and 2011 with options to
extend through 2012 2012 and 2015 respectively and
• a development facility in zhongguancun software park haidian
district beijing china 50000 sq ft under a lease through 
2011 with options to extend through 2016 reuters is in the 
final phases of further expanding that operation by an additional
50000 sq ft
the reuters building at 3 times square is owned and was developed
by 3 times square associates llc which is a joint venture between
reuters and rudin times square associates llc reuters leases
692000 sq ft from the venture of which 288000 sq ft is subleased to
instinet group which in turn has subleased approximately 180000 sq
ft to third parties the principal part of reuters lease will expire in
2021 subject to three tenyear extension periods see ‘3 times square
associates llc’ in note 34 on page 123 for further information
the computer equipment that reuters uses to create manage and
deliver its products to customers across the world forms the bulk of its
tangible fixed assets this equipment is distributed across global sites
with greater concentration at the major global and regional technical
centres as reuters extends its use of hosting services and browser
delivery for its products the quantity of equipment located at
customer sites is being reduced
legal proceedings
except as described above in note 35 on page 124 neither the group
nor any of its directors members of senior management or affiliates 
is subject to any legal or arbitration proceedings which may have or
have had in the recent past significant effects on the group’s financial
performance or profitability
information for shareholders continued 154 reuters group plc annual report and form 20f 2006
item description annual report page ref
1 identity of directors senior management and advisers na
2 offer statistics and expected timetable na
3 key information
a selected financial data 52–53149
b capitalisation and indebtedness na
c reasons for the offer and use of proceeds na
d risk factors 65–67
4 information on the company
a history and development of the company 6–11 44–45 153
b business overview 8–13 44–45 58–62 83–84
c organisational structure 128 145
d property plant and equipment 50 154
4a unresolved staff comments na
5 operating and financial review and prospects
a operating results 54–62
b liquidity and capital resources 63
c research and development patents and licences etc 44–45
d trend information 45–47
e offbalance sheet arrangements 65
f tabular disclosure of contractual obligations 63–64
6 directors senior management and employees
a directors and senior management 25–28
b compensation 29–37
c board practices 26 29 31 42–43 147
d employees 12 30–31 47–48 143
e share ownership 30 37
7 major shareholders and related party transactions
a major shareholders 144–145
b related party transactions 123–124
c interests of experts and counsel na
8 financial information
a consolidated statements and 
other financial information see item 17
litigation 124
dividend policy 68
b significant changes 127
9 the offer and listing
a offer and listing details – price history of shares 145
b plan of distribution na
c markets 145
d selling shareholders na
e dilution na
f expenses of the issue na
item description annual report page ref
10 additional information
a share capital na
b memorandum and articles of association 146–148
c material contracts 151–152
d exchange controls 149
e taxation 150–151
f dividends and paying agents na
g statement by experts na
h documents on display 157
i subsidiary information na
11 quantitative and qualitative disclosures 
about market risk 62 99–108
12 description of securities other than equity securities na
13 defaults dividend arrearages and delinquencies na
14 material modifications to the rights of security holders 
and use of proceeds na
15 controls and procedures 41–42 74
16a audit committee financial expert 42
16b code of ethics 38 43
16c principal accountant fees and services 42 133
16d exemptions from the listing standards for audit committees na
16e purchases of equity securities by the issuer
and affiliated purchasers 116
17 financial statements na
report of the auditors 74
consolidated income statement for each of the three years 
in the period ended 31 december 2006 75
consolidated statement of recognized income and expense 
for the three years in the period ended 31 december 2006 75
consolidated balance sheet at 31 december 2006 2005 and 2004 76
consolidated cash flow statement for each of the three years 
in the period ended 31 december 2006 77
accounting policies 78–82
notes to the financial statements 83–128
summary of differences between ifrs as adopted by the eu 
and us gaap and related notes 129–133
18 financial statements na
155 information crossreference guide to form 20

f reuters group plc annual report and form 20f 2006
term used in annual report us equivalent or brief description
allotted issued
associates affiliates accounted for under the equity method
business segment industry segment
called up share capital ordinary shares issued and fully paid
capital allowances tax term equivalent to us tax depreciation allowances
combined code a set of corporate governance principles and detailed codes of practice
destination of revenue the geographical area to which goods or services are supplied
finance income interest income
freehold ownership with absolute rights in perpetuity
origin of revenue the geographical area from which goods or services are supplied to a third party 
or another geographical area
profit income
profit for the year attributable to the equity holders of the parent net income
share capital ordinary shares capital stock or common stock issued and fully paid
shares in issue shares outstanding
share premium additional paidin capital or paidin surplus not distributable
trade payables accounts payable
trade receivables accounts receivable
156 glossary reuters group plc annual report and form 20f 2006
financial diary for 2007
thursday 1 march
results for full year 2006 announced
wednesday 14 march
ordinary shares and adss go exdividend
wednesday 25 april
first quarter trading statement issued
thursday 26 april
annual general meeting
time 1130 am
venue the reuters building 
south colonnade canary wharf 
london e14 5ep
thursday 3 may
final dividend for 2006 payable to 
ordinary shareholders on the register 
as at 16 march 2007
thursday 10 may
final dividend payable to ads holders 
on the record as at 16 march 2007
tuesday 31 july
results for first six months of 2007
announced
wednesday 8 august
ordinary shares and adss go exdividend
wednesday 5 september
interim dividend for 2007 payable to
ordinary shareholders on the register 
as at 10 august 2007
wednesday 12 september
interim dividend payable to ads holders 
on the record as at 10 august 2007
thursday 25 october
third quarter trading statement issued
where to find us
corporate headquarters
the reuters building
south colonnade
canary wharf
london e14 5ep
tel 44 020 7250 1122
registered in england
no 3296375
corporate website aboutreuterscom
investor queries
miriam mckay
tel 44 020 7542 7057
fax 44 020 7542 4661
email miriammckayreuterscom
media queries
ed williams
tel 44 020 7542 6005
fax 44 020 7542 4835
email edwilliamsreuterscom
registrardepositary
for dividend queries duplicate 
mailings and change of address
ordinary shares
lloyds tsb registrars
the causeway worthing
west sussex bn99 6da uk
tel 0870 600 3970
for callers within the uk
tel 44 121 415 7047
for callers outside the uk
fax 44 01903 833 482
website shareviewcouk
american depositary shares
deutsche bank adr service center
co mellon investor services
480 washington boulevard
jersey city
nj 07310
usa
tel 1 866 282 4011
website adrdbcom
electronic copies
the annual report and form 20f and the
annual review are available on the internet
at aboutreuterscomreportsar2006
listings
london stock exchange rtrl and
nasdaq rtrsyo
options on ordinary shares are traded 
on euronext liffe futures contracts on
ordinary shares are traded on the euronext
liffe universal stock futures market 
the american stock exchange in new york
lists options on american depositary shares
of reuters
corporate brokers
citigroup and jpmorgan cazenove limited
financial pr
brunswick group limited
157 information financial diary and where to find us
the cover of this report is printed on era silk which
contains 50 recycled and deinked pulp from post
consumer waste the remaining 50 is made up of fsc
certified material manufactured from genuine virgin
pulp from certified sustainable forests the text pages
of this report are printed on take 2 offset which
contains 100 recycled deinked pulp from post
consumer waste
printed by ctd an fsc and iso 14001 certified printer
designed and produced by salterbaxter
cover caption canadian women’s team race 
at speedskating world cup in berlin germany
photographer tobias schwarz
trade marks
reuters the sphere logo and reuters product names
referred to in this review are trade marks or registered
trade marks of the group around the world other
trade marks of third parties are used in this report for
the purpose of identification only  faster
reuters group plc annual review 2006 key facts about reuters
• reuters has been a trusted source
of news and information since it was
founded in 1851
• we employ 16900 people in 89
countries
• we are a constituent of the ftse100 
• we are listed on the london stock
exchange and on nasdaq
• we publish in 19 languages and serve
121 countries from 199 bureaux
• nearly 350000 financial markets
professionals use our information
• our machinereadable data powers over
50000 customer software programmes
• 450 of the world’s largest broadcasters
use our newswires for text pictures 
and video
• we reach one billion people every day
shareholder returns
£661m
returned to shareholders in 2006 via 
buybacks and dividends
business review
01 explaining reuters
02 ceo’s review
04 our strategy
05 our performance
06 our markets
08 our resources
09 our challenges
10 chairman’s statement
11 the speed of change
12 in the financial world
14 in the media world
16 in reuters
18 our business divisions
18 sales  trading
19 enterprise
20 research  asset management
21 media
governance
22 interview with the chairman
24 corporate responsibility
28 directors
30 summary remuneration report
financials
34 summary operating and
financial review ofr
36 summary financial statement
information
39 information for shareholders
and forwardlooking statements
40 financial diary for 2007
40 where to find us
reuters is the world’s largest
provider of financial information
trading room software and news
the financial and media markets
we serve are evolving at an
unprecedented rate and we are
moving faster to respond to this
rapid change 
overview
this review has been claritychecked 
and awarded the clear english standard 
by plain language commission 
wwwclearestcouk which promotes 
clear and concise communication in 
documents and on websites reuters 
is the only ftse 100 company to win 
the accolade for an annual review
nongaap measures
a number of measures used in this document are 
‘nongaap’ figures which are performance measures
used to manage the business supplementing the
international financial reporting standards ifrs
measures these include ‘underlying change’ 
‘trading costs’ ‘trading profit’ ‘trading margin’
‘adjusted eps’ ‘trading cash flow’ ‘free cash flow’ 
and ‘net debtnet funds’ 
detailed descriptions of these terms including 
the rationale for using them and reconciliations 
to the most directly comparable ifrs indicator 
are provided in the reuters group plc annual 
report and form 20f 2006 which can be found 
at aboutreuterscomreportsar2006 reuters group plc annual review 2006
sales  trading
our products
advanced desktop ﬁnancial
information products 
analytics and trading systems
designed for use by traders
and salespeople
enterprise
our products
information feeds and tools
designed for use by machines
to help our customers 
automate their businesses
research 
asset management
our products
indepth information 
analysis and research 
products designed mainly
for use by people making 
investment decisions
media
our products
news for use by professional
publishers multimedia 
websites and mobile 
information services for use 
by individual consumers
traders
brokers
salespeople
it decision makers
financial
technology innovators
corporates
bankers and analysts
investment managers
private wealth 
managers
website consumers
press
t elevision
our customers
our divisions
business review explaining reuters
total 2006 revenue
£2566m
we run the business through 
four divisions each meeting a
speciﬁc set of customer needs
01
2006 revenue
£1690m
2006 revenue
£298m
2006 revenue
£408m
2006 revenue
£170m
news realtime market data 
and trading systems are our
core competencies
we give our customers competitive
advantage with highvalue content
and insight
our data and trading room
software form a vital part of
our customers’ systems
we are the world’s largest
multimedia news agency
with scope to build a strong
consumer media business
for more information on our business divisions see pages 18–21 reuters group plc annual review 2006
our goal is to accelerate the growth 
in revenues begun last year while
bringing a greater proportion to the
bottom line in proﬁts
2006 was a year of considerable
achievement for reuters in last year’s
annual report i stated that the key drivers
for 2006 would be “to deliver on our 
core plus investments to accelerate our
revenue growth to continue to really
focus on customer service and to maintain
the good cost control of the last few
years” i am very happy to say that we
achieved each of these goals and more
during 2006 we raised the pace of our core
plus programme and produced £32 million
of new revenues from the four initiatives
electronic trading highvalue content new
enterprise services and new markets this
permitted us to exceed our 2006 target of
one percentage point of additional revenue
growth from core plus
in terms of overall revenue growth we
exceeded market expectations by delivering
65 growth at actual rates 48 underlying
which was very gratifying to me personally 
it was not so long ago that many in the
market while acknowledging our ability to
cut costs doubted that we could restart
growth after a long period of retrenchment
2006 was also a year in which our signiﬁcant
investments to transform and simplify the
company began to take shape these
investments will continue through 2007 with a
focus on making our services more resilient
finally despite the increased investment in
core plus growth and transformation activities
we continued to hold a tight line on cost
looking ahead to 2007
as i write this review we are already well 
into 2007 – a year that has begun strongly 
for reuters our principal goal this year is to
accelerate the growth in revenues begun 
last year while bringing a greater proportion
down to the bottom line in proﬁts
this will be achieved in part as revenues
from core plus increase through the year 
we’ll also continue to focus on improving
customer service through investment in
reuters infrastructure and through instilling 
a service culture at reuters t oward this goal
i am personally leading a drive to simplify
our processes our technology and our
organisation
in my recent meetings with customers around
the world i have been encouraged both that
general market conditions appear to be
favourable and that the speciﬁc areas we are
targeting under core plus are expected to 
be in high demand in particular the growth
of electronic trading is now indisputable
serving both people and machines
reuters has always served the needs of
individual users in the ﬁnancial community 
as well as the machines that power their
ﬁrms however this distinction is increasingly
important reuters suite of trading room
systems risk management platforms
enterprise datafeeds and transaction services
is perfectly aligned to the growth in machine
ceo’s review 02 reuters group plc annual review 2006
based activities such as algorithmic trading
at the same time the human beings who are
active in the ﬁnancial services industry require
evermore sophisticated and comprehensive
sets of information and analytics as they seek
to differentiate their performance reuters 
is uniquely skilled to serve this twin need
managing our portfolio
capitalising on our strong position in the
treasury market reuters entered into a 
joint venture with the chicago mercantile
exchange cme in 2006 to launch a new
electronic system to trade foreign currencies
the venture called fxmarketspace is
launching in march 2007 and will offer the
market the ability to trade foreign exchange
on a cleared central counterparty basis like
an exchange for the ﬁrst time i view this as 
a great example of reuters innovative streak 
at work as well as proof that we will not just
complacently sit and milk our best assets 
but seek to lead the market in new directions
we also moved swiftly in 2006 to sell the
majority of our 50 interest in the factiva
joint venture to our partner dow jones 
we concluded that we could achieve the
most value for our shareholders by selling
this deep online library of content before
competition from free search engines 
eroded factiva’ s advantage
media and journalism
our media business performed very well in
2006 across both its agency and consumer
units in the agency business we beneﬁted 
as western publishers and broadcasters
retrenched and continued to pull back their
journalists to home base and newspapers 
in particular scrambled to add video to their
websites meanwhile domestic demand 
in asia and the middle east grew strongly
our directtoconsumer unit which mainly
derives its revenues from advertising carried
on reuterscom and associated mobile and
online properties grew 39 in 2006
at the core of what we do at reuters is the
work of our 2400 journalists we increased
our editorial staff by over 130 in 2006 and
produced a slew of exclusives and ‘beats’
from the ongoing war in iraq to the world
cup competition to the israellebanon
conﬂict in my presentation to the israel
business conference excerpted at
aboutreuterscompressofﬁcespeaker
transcriptsglobesconferencedoc i discuss
how reuters responded to a serious breach
of our news photography standards which
occurred in lebanon
the bravery quality and motivation of
reuters journalists around the world remain
a great inspiration to me more generally it 
is the diversity intelligence compassion and
determination of our people that make my
job as ceo so personally rewarding
tom glocer
ceo
business review 03 our mission is to make reuters the leading 
provider of content and transaction services 
trusted by customers from the individual to 
the most sophisticated institution
as we move from restructuring to growth our 
aim is to deliver the shareholder value that we 
believe the company is capable of generating 
we are doing this in two ways
1 growth
we are growing our revenues faster 
both within our core business and through 
our core plus initiatives in the medium
term we plan to deliver strong sustainable
revenue growth assuming continued
growth in the ﬁnancial services industry
steady improvement in our nextgeneration
products is helping us to attract new users
particularly among institutional investors
we have started to see new revenues come
through from the portfolio of core plus
projects we put in place to capitalise on four
highgrowth market areas
• electronic trading
• highvalue content
• new enterprise services
• new markets
revenue growth targets
we expect our core business to grow 
at least as fast as the market in addition 
we have targeted new revenue from our
core plus initiatives
targets
• 1 percentage point of new revenue 
in 2006 exceeded
• 2 percentage points of new revenue 
in 2007
• 3 percentage points of new revenue 
in 2008
2 simpliﬁcation
we are becoming stronger more 
competitive and more efﬁcient as we 
continue to simplify our organisation 
we’re working hard to deliver better 
products and better customer service
we are doing this by
• changing the way our product 
development teams work
• simplifying our product delivery 
infrastructure and making it more robust
• transforming the way our content 
is created collected and processed
• modernising our customer 
administration systems
projected cost savings
as we continue to implement these initiatives
we expect them to deliver annualised cost
savings reaching £150 million by 2010
customer satisfaction
we measure customer satisfaction through 
a biannual survey of over 12000 ﬁnancial
markets customers satisfaction has increased
over the last three years with customers seeing
particular improvements in the quality of our
training support and account management
customer satisfaction 
our strategy
reuters group plc annual review 2006
04
06
05
04
731
723
709
calculated on a 100point scale revenue growth
65
dividend increase
10
operating proﬁt increase
24
operating highlights
• revenues growing ahead of target
• new core plus initiatives making good
progress
• fxmarketspace joint venture underway
• opening of beijing development centre
• sale of factiva stake to dow jones
completed
• application networks acquired to 
broaden our risk management product line
• first innovation programme projects
launched
business review our performance
reuters group plc annual review 2006
earnings per share eps 
and adjusted eps

pence
our eps was 236p in 2006 down 9p from
the previous year reﬂecting lower proﬁts 
on disposals than in 2005 when we disposed
of our instinet stake adjusted eps was
171p in 2006 up 33p from the previous
year this reﬂected lower restructuring
charges and fewer shares in circulation 
due to our share buyback programme
operating proﬁt trading proﬁt 
and margins

£m
our operating proﬁt rose to £256 million in
2006 operating margin 10 an increase
of £49 million over 2005 operating margin
9 trading proﬁt declined to £308 million
trading margin 12 down £26 million over
2005 trading margin 14 this included
£77 million of net new investment in core
plus partly offset by revenue growth
revenue £m
our 2006 revenue grew by 65 to £2566
million acquisitions mainly t elerate
contributed 14 percentage points of growth
exchange rate movements accounted for 03
percentage points excluding acquisitions
disposals and currency revenue grew by
48 13 percentage points of this growth
came from core plus ahead of our target 
we increased our total regular dividend by 
10 the ﬁrst increase since 2000 reﬂecting
our growing conﬁdence in future business
performance
dividend pence
 deﬁnitions of trading proﬁt trading margin and
adjusted eps can be found in reuters group plc
annual report and form 20f 2006 – see 
aboutreuterscomreportsar2006
06
05
04
2566
2409
2339
06
05
04
11p
10p
10p
06
05
04
236p
171p
326p
138p
260p
118p
eps adjusted eps 
05
06
05
04
operating profit trading profit 
256
308
207
334
194
326 reuters group plc annual review 2006
our markets
more than 90 of our revenue comes from
serving the rapidly evolving ﬁnancial services
marketplace which includes investment and
commercial banks brokerdealers asset 
and wealth managers and commodities 
and energy traders
the innovative ﬁnancial markets are
experiencing rapid structural change 
we are adapting to meet their increasingly
complex and timesensitive demands
the media markets are also undergoing
dramatic change we are well positioned to
address these marketplace dynamics with
our recent innovations in usergenerated
content including blogs and our work 
to reach the next generation of media
consumers through new digital platforms
such as mobile phones online video and
interactive television
key market trends
• market structures are continuing to evolve
foreign exchange is set to shift towards
an exchangetraded model bank and
exchange consolidation is ongoing
• the rise in electronic trading is set to
continue in 2007 and beyond
• the ﬁnancial services industry is
developing increasingly complex 
highly structured ﬁnancial products
• the hedge fund industry is expected to
continue its growth and remain important
to the ﬁnancial markets ecosystem
• wealth management is the fastest
growing segment of the ﬁnancial 
services marketplace
• financial information technology spending
is expected to continue rising in 2007
• new market regulations such as the
markets in financial instruments directive
mifid in the eu and regulation nms in
the us are creating requirements for more
extensive disclosure of prices
• traditional media companies are
embracing usergenerated content and
online social networks as new ways of
engaging with their audiences
• online audiences and advertising 
revenues are growing rapidly rivalling
traditional media
over 90 of our revenue comes from
serving the rapidly evolving ﬁnancial 
services marketplace our news and
information reach one billion people 
every day
our markets 06 reuters group plc annual review 2006
our market share in ﬁnancial markets
each year we publish ﬁndings from our
market size and share study this study 
looks at the £6 billion global market for
ﬁnancial information and services in which
our business operates 80 of our revenues
are covered by the study

our market share by revenue in this market
increased by one percentage point in 
2005 to 27 level with bloomberg our 
main competitor in the desktop products
business this share gain was largely driven
by the acquisition of t elerate in june 2005
analysis of our market share for the full year
2006 is being ﬁnalised and will be published
in april 2007
as a result of our core plus strategy which is
taking us into new markets our addressable
market is expected to expand from £6 billion
to £11 billion per year
our market share in consumer 
media markets
over the last two years our reuterscom
family of websites has attracted a growing
number of users worldwide and now reaches
166 million visitors per month currently 
our largest audiences are in the us and 
the uk our website ranking in the ﬁnancial
information category as measured by
nielsennetratings in the us improved 
from 8th to 5th based on the number of
unique visitors between 2005 and 2006 
our website ranking in the business
newsresearch category as measured by
comscore media metrix in the uk improved
from 6th to 4th between 2005 and 2006
business review
us visitors to reuters websites millions
06
05
66
59
number of unique visitors december nielsennetratings us
07
 excludes media revenues recoveries 
and some enterprise revenues reuters group plc annual review 2006
our people our
brand and our
content are key to
our ability to deliver
on our strategy
our people
we seek to attract and retain talented
people who are knowledgeable about 
the markets we serve customerfocused
adaptable and committed to learning 
and development
our diverse employee base comprising 
over 100 nationalities reﬂects the different
cultures and markets we operate in and
contributes innovative ways to serve our
wide range of customers
as we have focused on making our products
more competitive and extending our content
we have built up our development and
content management centres in bangkok
beijing bangalore and singapore 30 of
our employees are now based in asia
we carry out an annual employee
engagement survey the results of our
most recent survey november 2006 showed
yearonyear improvements across all the
categories that make up our employee
engagement index leadership customer
orientation performance employee
commitment and career development
employees are given objectives which
are aligned to the company’s goals
performance against these objectives is
rewarded through the performancerelated
elements of remuneration such as bonuses
and equity in the company employee
turnover for our highest performers
remains below the 35 target we have set
our brand
our brand is a powerful asset ranked as 
a t op 100 global brand by interbrand 
the essence of our brand is trust strong
brands attract customers and help to drive
ﬁnancial performance as an organisation
and as a brand we are aligned to deliver
consistently on the reuters trust principles 
of independence integrity and freedom
from bias for more information on how
these principles inform our approach 
to doing business see ‘corporate
responsibility’ on pages 24–27
our content
reuters runs the world’ s largest multimedia
news operation employing 2400 journalists
who produce 250000 news stories in 
19 languages 40000 pictures and over 
4000 video stories each month we also
supply the data that powers the ﬁnancial
markets we offer insight into the markets 
by creating polls analytics indices and
composite prices we aggregate price
information collected from contributors for
many asset classes and we distribute trade
data published by exchanges and other
trading venues
we add unique value to all this content by
organising and labelling it within our data
model a framework which makes it easy for
our customers to use the data within their
own software applications
our resources
this page running barefoot
south africa’ s dina phakula
sprints ahead of the
competition at the 2006
commonwealth games
photographer andy clark 
employee engagement 
06
05
04
58
50
47
distribution of employees by region
europe middle east and africa
the americas
asia
based on average number of employees for the year
06
05
04
16300
15900
16000
08 reuters group plc annual review 2006
action
• diversify revenues through emphasis on core plus
• prioritise initiatives that help customers achieve greater 
efﬁciency through business automation
see ‘our strategy’ on page 4 ‘enterprise’ on page 19
• continue to develop core plus electronic trading initiatives
• implement services which address mifid and reg nms requirements
• monitor industry shifts closely
• engage with customers’ strategies and ensure that our own 
strategy remains aligned with theirs
• launch fxmarketspace with cme
• experiment with new business models within our innovation portfolio
see ‘our markets’ on pages 6 – 7 ‘our business divisions’ on pages 18–21
‘our strategy’ on page 4
• set appropriate ‘tone at the top’ from senior management
• provide training on ethics and reuters trust principles
• enforce clear accountability
• ensure regular board review
see ‘interview with the chairman’ on pages 22– 23
• measure and monitor service levels
• execute service improvement and content quality plans
• continue to promote a servicedriven culture
• complete investments in data centre and capacity improvements
see ‘our strategy’ on page 4 ‘our resources’ on page 8
• monitor progress closely at board and group leadership t eam
level glt
• prioritise resources for strategic programmes
• monitor the changing nature of our business by using fewer larger
processing venues
see ’interview with the chairman’ on pages 22 – 23
• keep our hiring and development plans in focus
• monitor performance employee demographics and turnover
• align the achievement of organisational objectives more closely 
with remuneration
see ‘our resources’ on page 8 ‘interview with the chairman’ on pages 22–23
‘summary remuneration report’ on pages 30 – 33
risk
financial markets are cyclical
the ﬁnancial services industry is
undergoing rapid structural and
regulatory evolution
the integrity of our reputation is key
to our ability to remain a trusted source 
of news and information
our customers demand high levels of
service to help them perform effectively
we have both revenue growth and
simpliﬁcation programmes underway
continuing to drive cultural change and
attract and develop talented individuals 
is key to our success
impact
downturn in the ﬁnancial markets 
could make it more difﬁcult for us 
to achieve our ﬁnancial goals
we need to keep pace with structural
changes if we are to maintain a strong
market position
we need to protect our brand in
order to sustain our credibility as 
a neutral supplier of content
we need to anticipate and respond 
to our customers’ needs if we are 
to improve our competitiveness
we must ensure that we can resource 
and complete both our revenue growth
and simpliﬁcation initiatives so that we
can achieve our ﬁnancial targets
without the necessary skills and 
a faster more responsive company
culture we will ﬁnd it difﬁcult to achieve
our corporate potential
our ‘risk radar’ reviewed by 
the board captures key external 
and internal risks that could affect 
reuters ability to reach its full 
potential and the actions and 
plans in place to mitigate them
business review our challenges 09 reuters group plc annual review 2006
when change is a constant adaptability
carries a premium a stronger reuters has
emerged from a period of fundamental
change – in our products in how we 
serve our customers and in how we are
organised but the continuous and rapid
evolution of our markets means we must
become even more agile to sustain a
competitive edge greater focus and
radical simpliﬁcation are crucial objectives
for 2007 i am conﬁdent that tom glocer
and his team in partnership with the board
will address these challenges efﬁciently
in the same way companies must evolve 
with their markets business must evolve 
with society globalisation has driven
unprecedented wealth creation but not
without a price political economic social
and environmental imbalances threaten
global stability and the very conditions that
have allowed global business to ﬂourish
society expects business to assume 
greater responsibility towards people 
and the communities in which it operates 
it is entitled to expect business leadership 
that combines optimum returns for
shareholders with responsibility for social
and environmental performance companies
are unlikely to succeed if society fails
the board must bring an external
perspective to the company t o do so 
the board must reﬂect the diversity of the
society in which the business operates 
i am proud of the range of experiences 
and backgrounds represented on the
reuters board in 2006 we announced that
nandan nilekani ceo of infosys would 
join the reuters board in january 2007
equally the board must continually scan the
external horizons in 2006 the board and
executive management met in palo alto
california to gain a ﬁrsthand understanding
of new technology trends and evolving
business models highperforming boards
need to evaluate their own performance
last year we completed a comprehensive
board effectiveness review and implementing
the recommendations is an important
objective for 2007 
the reuters trust principles are at the heart
of our responsibility to society they commit
us to independence integrity and freedom
from bias in the gathering and dissemination
of news and information guided by these
principles i am conﬁdent we can provide the
growth our shareholders expect and fulﬁl
the role society demands they also attract
and motivate the outstandingly talented
people we need to build our future
niall fitzgerald
chairman
the continuous and rapid
evolution of our markets
means we must become 
even more agile to sustain 
a competitive edge
chairman’s statement 10 being on top of and responding 
to fastpaced change requires agility 
and imagination
the speed 
of change
11 business review
this page the space shuttle
discovery sits on the launch pad
at the kennedy space center
photographer rick wilking
reuters group plc annual review 2006 reuters group plc annual review 2006
speed is the hallmark of 
today’s global ﬁnancial 
markets driven by new trading
technologies new regulations
and rapidly shifting market
structures markets are creating
and consuming more information
at an everincreasing rate
rising tension in middle east
the ﬁrst rocket attacks on the israeli 
city of haifa heighten fears about 
global security and energy supply
reuters is ﬁrst with the news
the story spreads across our networks 
to trading rooms worldwide markets
react swiftly
13 july 2006
speed of change in the ﬁnancial world 12 reuters group plc annual review 2006
stocks fall while bonds rise
stock markets around the world rapidly
begin to slide as ‘safe haven’ assets 
such as us treasury bonds climb
pump prices increase
fuel prices in several european 
countries are driven to record levels 
crude oil prices soar
oil surges to a high of 78 a barrel 
on worries about supply disruptions
as electronic trading gathers momentum
we are giving our customers new ways of
capturing competitive advantage
in 2006 we launched
• reuters newsscope which codes and
delivers news stories in machinereadable
formats so they can be interpreted at high
speed by trading engines and used to
trigger decisions to trade
• reuters trading for exchanges 
which helps brokers to ﬁnd the best
counterparties for their trades through 
our global network
“the simple issue is that electronic
trading is cheaper faster more
efﬁcient and less open to ‘market
abuse’ electronic trading can
handle greater volumes and
combines a lower cost base 
with genuine global distribution”
patrick l young odl monaco
see patrick l y oung’s article ‘a revolution without end’
on aboutreuterscomreportsar2006
almost 1 00000 updates 
a second are carried over 
our networks
business review 13 reuters group plc annual review 2006
0545
a reuters journalist
by the earthquake that
muzaffarabad
widespread destruction
reuters newsdesk
0603
images of
in india
0630
an image appears on
0642
a canadian blogger questions
is reaching the 
blogs appear
concerns over the
kashmir
0815
reuters
minister asking
reconstruction costs a
0845
the story is reported
in newspapers and online and
is broadcast worldwide
speed of change in the media world 14 reuters group plc annual review 2006
takes photos of children orphaned
devastated the city of
demonstrating the
0551
the photos arrive at
children appear on a website
22 sites globally
the speed at which the aid
victims of the disaster
0803
six more
expressing their
humanitarian crisis in
quotes a pakistani
for an extra 800 million to cover
year on from the earthquake
as the commingling of professional and
amateur content reshapes the media world
reuters journalists continue to bring
something extremely important to each
story they cover they sift through the facts
provide perspective and give context 
they are committed to an editorial code 
and brand that stand for independence
integrity and freedom from bias
see tom glocer’s article
‘when media worlds collide’
at aboutreuterscomreportsar2006
“we can see that the pipe of 
news content is now ﬂowing
in both directions it ought
to be possible to integrate 
professional journalism with 
usergenerated content in a 
valuable way for our audiences”
tom glocer ceo reuters
business review 15 reuters group plc annual review 2006
nandan m nilekani ceo infosys and
nonexecutive director reuters gives 
his perspective on the opportunities and
challenges presented by globalisation
over the last few years reuters has
simpliﬁed and refocused its business 
it has opened content centres in
bangalore and gdansk it has shifted
development to bangkok and beijing 
and it has increased its focus on growth
markets such as india china the middle
east and eastern europe
global markets global talent
developing countries have become more
credible players in the global economy
together contributing more than half the
global gross domestic product it is a much
larger economic world with more places to
do business and also more competition
in addition to new customers there is a 
new pool of skilled workers in emerging
economies t en years ago few of these
groups were part of the global workforce
the global distribution of revenue
customers and costs talent is changing
and companies have no choice but to 
hire a more diverse global workforce 
this will be easier because the world is
increasingly wired
increases in technology and regulations
as the cost of technology has plunged
dramatically its usage has soared emerging
nations are leaping past the 20th century 
and landing squarely in the 21st in four
years china will have more broadband
connections than there are us households
as large new populations gravitate toward
the information highway there are new
expectations for information security and
privacy cutting across geopolitical
boundaries and leading to a plethora of
regulation highproﬁle regulations such as
markets in financial instruments directive
mifid in europe and regulation nms in
the us will bring about sweeping change in
the way companies like reuters look at their
business models and revenue streams 
these changes will require bold thinking 
and smart execution to operate successfully
in the years ahead
t ogether  these trends – emerging economies
shifting demographics increasing technology
and proliferating regulations – are ﬂattening
the business landscape
new challenges
most companies now recognise the new
challenges arising from these trends in
particular the increasing competition
especially from industries and geographies
previously considered insigniﬁcant
reuters trading business is facing challenges
from competition and changes in business
models exchanges are being ‘democratised’
with regulation levelling the playing ﬁeld
making location almost irrelevant in the 
us market regulations are driving some
investors to other continental exchanges
causing a structural shift in revenues in
addition as the types of instruments traded
on exchanges rise and transactions across
countries and markets rise there is a 
need for new kinds of information tools 
and solutions
progressive innovative companies are
adopting new strategies to address such
new opportunities and challenges i believe
that companies who want to win in this
ﬂattening world must shift their operational
priorities to make the most of the new
opportunities available to them 
and to keep ahead of the game 
we have to transform ourselves
constantly this requires bold thinking
and smart execution
speed of change in reuters
opposite page a bird ﬂies
past a giant globeshaped
building in shanghai china
photographer aly song
16 reuters group plc annual review 2006
as its current it related initiatives evolve into
comprehensive global sourcing capabilities
reuters will beneﬁt from improved cost and
efﬁciency with the increase in competitive
intensity the ability to respond quickly to
changing customer behaviour will rise
correspondingly companies have to focus
on drawing market and operational insights
from information collected from their
operations and those of their partners
accessing the global talent pool
equally important its recent global initiatives
also enable reuters to access the global
talent pool this last point is especially
important as industry after industry has
shown that as global locations such as asia
become global operations centres for
certain activities and functions a greater
proportion of the innovation comes from the
same regions investment in global talent
pools today paves the way for tapping them
for product and process innovation in years
to come 
as markets become increasingly price
driven rapid innovation is the key to
customer loyalty
reuters has made substantial strides in
becoming more focused and efﬁcient the
global trends driving the business world are
still in full swing over the next few years 
as these trends further affect the business
landscape only companies that shift their
operational priorities will win in the ﬂat world
rapid
innovation
is the key 
to customer
loyalty
17 business review
operational shifts
reuters has already taken signiﬁcant steps 
in this direction it is moving software
development to bangkok and beijing
working to consolidate data centres from
250 down to 10 by 2010 and planning to
move to a common technology platform 
it is increasing capacity and efﬁciency
through new content management centres
in bangalore and gdansk
further by focusing on the needs of markets
such as india china the middle east and
eastern europe reuters is ensuring that it
stays relevant to these growth markets
these operational shifts are positioning
reuters well for future growth and proﬁtability 
reuters datascope products which enable
computers to use realtime information 
for algorithmic trading are an example of
innovative use of technology to meet the
needs of the more demanding ﬁnancial
services industry sales  trading contributed 66 of 
our revenue in 2006 the division sells
prices news and trading tools for market
professionals active in the foreign
exchange ﬁxed income equities and
commodities markets
our products
reuters 3000 xtra provides indepth
coverage of international markets it offers
news data charts analysis tools and 
trading services
reuters trader is used by traders and
salespeople who focus on regional markets
or single asset classes
reuters dealing is an electronic trading
service used by banks to trade currencies
reuters trading for foreign exchange
reuters trading for fixed income and
reuters trading for exchanges are our 
new electronic trading products
highlights
• our premium desktop product reuters
3000 xtra continued to drive revenue
growth in sales  trading in 2006 this
growth was fuelled by favourable market
conditions customer upgrades from older
products customer demand for access to
our new trading products delivered over
reuters 3000 xtra and new sales into 
areas such as the ﬁxed income credit
derivatives markets
• reuters dealing beneﬁted from an 
active global foreign exchange market
selling well in emerging markets and to
hedge funds
• growth in reuters trader for 
commodities reﬂected volatile energy 
and commodities markets
• reuters trading for foreign exchange saw
very encouraging growth in the number 
of trades while reuters trade notiﬁcation
service which enables foreign exchange
brokers and their clients to exchange 
posttrade messages is beginning to
establish itself as an industry standard
financial performance
sales  trading revenue rose £77 million 
to £1690 million in 2006 operating proﬁt 
for the division was £174 million up 13
reﬂecting lower restructuring charges in 2006
than 2005 trading proﬁt was £214 million 
a decline of £26 million this reﬂected
signiﬁcant investment in our core plus
initiatives such as transactions services and 
in new customer administration systems
balanced to some extent by operating
efﬁciencies across the division we expect
these initiatives to deliver further revenue
growth and higher proﬁtability in 2007 
and beyond 
sales  trading growth in
electronic trading is changing the
dynamics of the trading ﬂoor
our business divisions continued
reuters group plc annual review 2006
18
2006 revenue
£1 690m
share of group total
66 our clients want to grow their revenues
and cut costs through increased business
automation our enterprise division can
help them by providing systems that
manage data and the data that ﬂows
through them the division contributed
16 of our revenue in 2006
our products
reuters datascope provides realtime
historical and reference data in machine
readable format
reuters datafeed direct provides ultra 
highspeed connections direct to exchanges
trade and risk management systems help
banks monitor their exposure to trading risk
reuters market data system rmds 
our ﬂagship information management
system is a content distribution network 
that enables banks to deliver data into 
a variety of ﬁnancial systems
highlights
• enterprise information products such as
datascope and reuters datafeed direct
saw strong growth financial services
customers are using more data as their
investment funds valuation systems and
their understanding of risk become
increasingly sophisticated
• growing demand for business automation
helped to increase revenues from our
trade and risk management products 
we launched kondor trade processing
which helps clients to manage their 
trade ﬂow efﬁciently and we acquired
application networks a risk software
provider specialising in ﬁnancial derivatives
although its contribution to revenues in
2006 was small it has a strong pipeline 
for 2007
• we saw lower revenues from information
management systems as we moved
smaller clients onto alternative internet
delivered reuters products and withdrew 
from selling hardware the majority of 
customers have now been upgraded to
rmds and its widespread use as a platform
for distributing information throughout
customers’ infrastructures is of key strategic
importance to reuters new core plus
products such as reuters wireless delivery
system and reuters tick capture engine
started to bring in revenue in 2006 and are
expected to make a larger contribution 
in 2007
financial performance
enterprise revenue grew £23 million to 
£408 million in 2006 operating proﬁt for 
the division increased slightly to £79 million
reﬂecting lower restructuring charges than in
2005 t rading proﬁt was £85 million a decline of
£9 million this reﬂected investment in our core
plus initiatives such as reuters datafeed direct
reuters datafeed tick history reuters tick
capture engine and reuters newsscope
enterprise helping our customers 
to automate their businesses
business review
reuters group plc annual review 2006
19
2006 revenue
£408m
share of group total
16  our research  asset management division
which contributed 11 of our revenue in
2006 provides highvalue content and
insight to the investment banking
investment management corporate and
wealth management communities
our products
reuters knowledge provides indepth
company data and research
reuters wealth manager is a ﬂexible 
broad ﬁnancial information service
lipper provides highquality investment 
fund performance data
highlights
• sales of reuters knowledge continued to
grow strongly in 2006 with user numbers
rising by 3000 to take the total to 14000
the high quality of our data on companies
and our indepth information on emerging
markets such as china and india were key
to this growth
• the division’ s management team
continued to restructure the unproﬁtable
lowtier wealth management desktop
products business which limited revenue
growth however demand grew among
wealth management customers for
customisable feeds of investment
information and for lipper data which 
now covers over 7000 funds there 
was a strong focus during the year on 
simplifying the wealth management
business in order to move it closer to
proﬁtability this will remain a key theme 
in 2007 as we begin to move existing
wealth management products onto 
a single global platform
• early client testing is underway for a 
new primary research service that offers
highvalue content both from reuters
industry sector specialists and respected
thirdparty content providers healthcare 
and technology are the ﬁrst sectors to 
be covered
financial performance
research  asset management revenue
increased 15 to £298 million in 2006 
and the division made progress towards
proﬁtability operating losses fell £23 million
to £12 million reﬂecting lower restructuring
charges than in 2005 trading losses were 
£7 million an improvement of £11 million
over 2005 the division made substantial
investments in highvalue content and in
enhancements to reuters knowledge
research  asset management
giving our customers competitive
advantage with highvalue content 
and insight
our business divisions
reuters group plc annual review 2006
19000 users 
of reuters
knowledge
worldwide
20
2006 revenue
£298m 
share of group total
11  our media division serves publishing 
and broadcasting customers and growing
online audiences through our consumer
websites the division contributed 7 
of our revenues in 2006
our media services
t ext pictures and video for publishers 
and broadcasters
news and ﬁnancial information delivered
online and via mobile and interactive tv 
to individual consumers these services
generate advertising revenues mainly
from the reuterscom family of websites
highlights
• our journalists continued to deliver
unrivalled breadth and depth in their 
news coverage in 2006 giving customers 
a competitive edge with marketmoving
scoops such as the chinese central bank’ s
signal in november that they were thinking
of diversifying their foreign exchange reserves
• our photographers won an array of
awards including a number of prizes at the
prestigious world press photo contest
reuters photographer akintunde
akinleye’s photo above of the aftermath
of a gas pipeline explosion near lagos
nigeria was ﬁrst prize winner in the spot
news category at the 2007 awards
• as publishers and broadcasters looked 
to control their editorial costs new sales
opportunities opened up for our agency
business this was reﬂected in strong
subscription sales of our tv services
particularly in the middle east and in central
and eastern europe and through increased
use of the reuters pictures archive
• we inform consumers directly through 
18 regional editions of our consumer
website these attracted nearly 17 million
visitors worldwide each month our
websites generate revenues mainly
through advertising
• we opened a news bureau in second life
the online community which generated
considerable interest see reuterscom
secondlife
• a new platform for our consumer 
websites launched in early 2007 will
improve performance providing greater
interactivity through the use of blogs 
and better linking of stories
financial performance
media revenue grew £17 million to £170
million in 2006 operating proﬁt for the
division increased to £15 million as a result 
of lower restructuring charges than in 2005
trading proﬁt fell £2 million to £16 million
reﬂecting investment in our core plus
initiatives to capitalise on the highgrowth
potential of interactive media services
media we are the world’ s largest
multimedia news agency
21 business review
reuters group plc annual review 2006
2006 revenue
£1 70m 
share of group total
7  reuters group plc annual review 2006
the role of the board – niall fitzgerald
chairman in discussion with rosemary
martin reuters general counsel and
company secretary
rosemary niall when you became
chairman of reuters in 2004 you proposed a
set of principles to guide the reuters board
why did you do that and what are they
niall the board needed to reﬁne how it
worked together the company was in
transition from survival to restructuring 
and preparing for a new phase of growth
board membership style and focus needed
to change to be responsive to the challenges
ahead we needed a dialogue around 
the board table about our role and how 
we could work together more effectively 
we agreed some working principles such 
as limiting formal presentations and our
desire for short and sharp board papers we
needed our time and energy deployed on a
few forwardlooking issues of real substance
rosemary you say the principles are not a
strict set of rules and yet you are adamant that
board papers are kept concise and that board
time is not consumed by formal presentations
why is this so important to you
niall board time is limited and we have to
use our time smartly formal presentations
constrict dialogue and put walls around 
an issue the deal is that executives and
advisers coming to a board meeting can
assume that the directors have done their
prereading and so there is no need to go
over the background and the facts these
are communicated in advance of the 
board discussion it is good discipline to 
be concise distilling issues to their essence
no guff just the issues
but we can do better so this year we’ve
been working on improving the quality of
information that the board receives in part
in response to comments in the 2005 board
effectiveness review we’ve reﬁned the
monthly performance report to make it less
dense more sharply focused and forward
looking we still have some way to go
rosemary looking back over 2006 what
were the main areas of attention for the
reuters board
niall in 2006 beyond ‘business as usual’
items such as monitoring ﬁnancial and
operational performance succession
planning and approving the budget and
plan for the year ahead we focused on 
a number of signiﬁcant initiatives these
included the creation of fxmarketspace
acquisition of application networks inc
disposal of reuters interest in factiva and
negotiations with the trustees of reuters 
two uk ﬁnal salary pension schemes to
substantially fund the pension deﬁcit 
we also examined our preparedness for 
any signiﬁcant interruption to business such
as a ﬂu pandemic and reviewed an incident
in which reuters inadvertently published 
a photograph that had been digitally
manipulated by a freelance photographer
working for us in beirut
the audit committee was very busy
with sarbanesoxley and preparations for
compliance with section 404 of the act 
they briefed the full board regularly
in june the board met in palo alto california
to discuss strategy stepping outside our
norms gave us the chance to spend more
time with the executive management team
and together consider new developments in
technology and business models the visit
reinforced the importance of continuous
innovation and creative partnerships as 
asia is a growing source of technological
innovation and we are focused on growing
our business across this region the board 
is planning to visit asia during 2007
rosemary this leads us to the question 
of how you ensure the reuters board has the
right mix of directors to lead reuters in the
ﬁrst decade or so of the 21st century
niall i chair the nominations committee
which includes dick olver and ian strachan
we meet to review the structure size and
composition of the board we have a view 
as to the ideal blend of experience and
expertise these include ﬁnancial services
technology media government and
regulatory affairs general commercial
acumen a mix of geographic experience
knowledge of reuters industry sectors and
an understanding of our customers
the strength of the group’s corporate
values its reputation and its ability to
deliver a successful business depend in
part on the effectiveness of its corporate 
governance system
22 interview with the chairman reuters group plc annual review 2006
governance
“good governance should 
be a powerful fuel for
growth i want reuters to 
use the principles of good
governance in this way”
niall fitzgerald
we identify which speciﬁc skills and
experiences individual directors have and 
we look for any gaps in 2005 we agreed it
would be advantageous to add a director
who is currently a chief executive and with
extensive knowledge of business in asia 
and of technology we were delighted when
nandan nilekani one of the founders of
infosys agreed to join reuters board from 
1 january 2007
in addition the nominations committee has
to ensure there are robust succession plans
for board committees during the year dick
olver said he wanted to step down from 
the chairmanship of the audit committee 
a role he had ﬁlled with distinction since
2000 i discussed with board colleagues the
appointment of lawton fitt as his successor
and this was unanimously approved by 
the board in october continuity will be
provided as dick will remain a member of
the audit committee he is also remaining
reuters senior independent director
rosemary what about succession planning
for senior executive roles during 2006 there
have been several changes in the senior
executive team in the last year what is the
board’ s role in relation to this
niall it’ s the chief executive’ s responsibility
to ensure the best senior executives are
appointed to help him manage the
company’ s business for many roles the
talent already exists within our ranks – 
for example it was pleasing to see the
promotion of mark redwood to become
head of the sales  trading division
michael peace to head of the research 
 asset management division and david
schlesinger to editorinchief it is also
important to bring in new talent to the ﬁrm
last year stephen dando joined as group
hr director from the bbc roy lowrance as
chief t echnology ofﬁcer from capital one
gerry campbell as global head of search
and strategic development from aol and
lee ann daly as chief marketing ofﬁcer
from espn in march david craig joined us
from mckinsey as group strategy director
the board’ s role is to oversee the quality of
management and the processes for ﬁnding
and developing outstanding talent we do
that by meeting regularly with managers
below board level and by reviewing twice 
a year the succession plans and talent
management process in 2006 it was agreed
that board members would each mentor one
or more highpotential executives
rosemary one of the principles you have
articulated for the board is the requirement
to maintain “a governance framework that
facilitates substance and not merely form”
what do you mean by this
niall ‘governance’ is much discussed but
often poorly understood the directors must
act in the longterm interests of shareholders
we will not be serving our shareholders 
well if we become myopically focused on
governance in a ‘box ticking’ way and fail to
look at the wider picture of how to capture
and build sustained shareholder value 
we need to use sound governance tools –
proper internal controls and processes a full
understanding of risk a rigorous approach 
to performance management insistence 
on transparency and integrity – to help us
create a highperforming company good
governance should be a powerful fuel for
growth i want reuters to use the principles 
of good governance in this way
rosemary one ﬁnal question at the end of
2006 the new companies act was introduced
in the uk although it will take a while for 
the new law to be implemented in full do
you see it as requiring any major changes 
to the way reuters board operates today
niall a great deal will be written and spoken
about the implications of the new companies
act for uk companies there has already
been much discussion about the new
requirement for directors to have regard in
their decision making to the environment 
and the interests of employees all wellrun
companies focus on these and other issues
which are key to sustainable business
performance the companies act is about
codifying existing best practice into law
provided it is applied sensibly  little will
change inside the boardrooms of high
performance companies but let’ s see what
happens – and please no more boxes to tick
23 24
we steer our corporate responsibility
strategy through our corporate
responsibility advisory board crab
comprising customer supplier investor
employee and community representatives 
it is chaired by our general counsel and
company secretary who represents
corporate responsibility on the glt and 
to the board we are included in the dow
jones sustainability index the ftse4good
index the ethibel sustainability indices 
and the ethibel pioneer investment register
reuters hong kong has been accredited
with ‘caring company’ status for the third
year running by the hong kong council 
of social service
find more information about our corporate
responsibility programme on our website
aboutreuterscomcsr
employees
we have extensive fair employment
practices in place and with the support of
our global diversity advisory council
chaired by the ceo we are working to make
reuters an increasingly inclusive company 
in 2006 reuters was awarded the disability
‘t wo ticks’ symbol in the uk which
recognises our commitment to the
employment retention training and career
development of disabled employees
at our bangalore business service centre 
we started to work with enable india an
organisation that helps people with
disabilities to ﬁnd jobs we support the
principles incorporated in south africa’ s
broadbased black economic empowerment
act of 2003 we have a plan in place to
achieve full compliance with all aspects of
the act including employment equity skills
development preferential procurement
enterprise development and corporate
social investment 
highlights of 2006
• developed an ethical supply chain 
code for use with our suppliers
• developed mentoring programmes 
and afﬁnity groups to raise awareness 
of diversity issues
• raised employee participation in
community events week to 18
• raised awareness of environmental
issues with customers through our
reporting and with employees through 
green week
corporate responsibility is
integral to our business practices 
and our working life
above left an earthquake survivor 
holds a sick child in a camp in kashmir
photographer goran t omasevic
above right reuters photographer
ahmad masood in discussion with
participants at workshop organised 
by reuters foundation in kabul
afghanistan
corporate responsibility
reuters group plc annual review 2006 25 governance
in 2006 our employee engagement survey
included questions on corporate
responsibility for the ﬁrst time and recorded
a very positive response we also saw strong
scores on items related to the company
values “i fully support the values for which
reuters stands” 90 favourable response 
“i am proud to be associated with reuters”
and “reuters provides a working environment
that is accepting of ethnic differences”
both 89 favourable response
community
we support a variety of community initiatives
and charitable causes through the work of
reuters foundation and the volunteering
efforts of our employees around the world
reuters foundation foundationreuterscom
focuses on areas where our expertise in
information gathering and communications
can be put to use in ways that will beneﬁt the
communities in which we operate across the
world during the year  the foundation offered
training opportunities to journalists and
humanitarian workers from all over the world
above workers hang ribbons 
from cranes in cape t own harbour 
to commemorate world aids day
photographer mike hutchings
charitable donations in 2006
£1 8m
in february 2006 reuters became a member
of the global business coalition on hivaids
an organisation that aims to increase the
range and quality of business sector aids
programmes in the workplace and in the
community t o build on our work in this area
reuters foundation ran its fourth annual
workshop on hivaids reporting reuters
foundation also hosted a panel debate in
london looking at the role of the media in
keeping the spotlight on hivaids
reuters alertnet alertnetorg our
humanitarian news network aims to keep
relief professionals and the wider public up
to date on humanitarian crises around the
globe mediabridge a project designed to
improve news coverage by providing online
training for reporters and detailed brieﬁngs
on countries and issues was launched in july
2006 it is jointly funded by the department
for international development
reuters group plc annual review 2006 our business also plays a role in effectively
disseminating information about the
environment we have a network of
journalists who are an authoritative source 
on environmental issues focusing specially
on such things as global warming and
population growth
we have signed up to the climate change
initiative led by swedish energy company
vattenfall see vattenfallcom by engaging
with thought leaders in this area we are
aiming to increase our understanding of
alternative resourceefﬁcient technologies
such as virtualisation

 there may be a role
for these in the operation of our data centres
as they account for a signiﬁcant proportion
of our overall energy use
all employees can take one day of company
time each year to engage with community
groups employees beneﬁt from developing
their teambuilding and leadership skills with
their colleagues while providing valuable
community support reuters continues to
support housebuilding programmes run 
by habitat for humanity with employee
volunteers travelling to sri lanka india 
new orleans and south africa since the 
start of 2006
more information about reuters 
foundation programmes is available at
foundationreuterscom and alertnetorg
environment
we are classiﬁed by ethical investment
research services eiris as belonging to 
a sector with low environmental impact 
we understand that while our products 
have a low environmental footprint our
responsibilities lie in managing our facilities
and raising employee awareness of
environmentally friendly choices at work 
at home and when travelling we held our
green week event designed to inform
employees about environmental issues 
in 18 locations in 2006
during 2006 we worked with an independent
environmental consultancy to identify the
indicators we should track in order to
measure our environmental impact they
highlighted measures relating to electricity
and water consumption waste and carbon
dioxide production and paper buying in
2007 we are implementing an environmental
management system to monitor data from
our key ofﬁce and data centre locations
we recognise that our business air travel 
affects the environment in 2006 we reduced
it by 10 and wherever possible we use
alternatives including videoconferencing
and teleconferencing in 2007 we will pilot
the use of carbon offsets for air travel by
some of our global teams
26 corporate responsibility continued
reuters group plc annual review 2006
 a technology that enables multiple computers to
operate as a single entity increasing their efﬁciency marketplace
t o increase awareness among our end 
users of the latest developments in our
product range we invite customers to a
‘brightspot’ travelling showcase in cities
around the world
our innovation programme launched in
december 2005 looks for opportunities 
for reuters to reach new customers in 
new markets during 2006 it funded the
development of several new projects
including reuters market light a service for
rural farming communities via their mobile
phones farmers receive accurate local
pricing for their goods together with weather
information that inﬂuences their harvesting
patterns and hence the price they can get for
their goods at market an early version of the
service is being piloted in northern india
as a company we are committed to
developing relationships with suppliers
whose standards are as high as our own 
in september 2006 we launched our supply
chain ethical code which forms the basis 
of our agreement with suppliers based on
the recognised and wellregarded ethical
trading initiative base code our code
endorses expected standards of behaviour
and enables us to drive our commitment to
ethical and environmental improvements
and demonstrate a reduced risk through our
global supply chain we will require non
compliant suppliers to comply with the code
within a reasonable time and will work with
them to help this
we continue to provide information to our
investors through meetings presentations
and brieﬁngs and through our investor
website at aboutreuterscominvestors
opposite page a woman
walks with her bike near
amsterdam’ s central station
photographer koen van weel
this page far left wind
turbine on brooklyn hill in
wellington new zealand
photographer anthony phelps
top right emergency 
world food programme
supplies being unloaded 
in the town of t ahoua niger
photographer finbarr o’reilly
bottom right an indian farmer
talking on her mobile phone
our business plays a role in effectively
disseminating information about the
environment we have a network of 
journalists who focus on such things as 
global warming and population growth
our 2007 objectives
• embed our supplychain ethical code 
into our daytoday sourcing activities
• raise employee participation in
community programmes to 20
worldwide by focusing on staff
development opportunities and
environmental causes
• extend bestpractice healthand
safety and familyfriendly policies 
to our operations worldwide
• implement our new environmental
impact monitoring system and collect
data that we will report on for this year
and onwards
• publish a document for employees 
and external audiences which 
explains reuters approach to 
corporate responsibility
27 governance
reuters group plc annual review 2006 reuters group plc annual review 2006
07 ed kozel
08 sir deryck maughan
09 nandan nilekani
10 ken olisa
11 dick olver
12 ian strachan
01 niall fitzgerald kbe
02 t om glocer
03 david grigson
04 devin wenig
05 lawton fitt
06 penny hughes
nominations committee
niall fitzgerald chairman
ian strachan
dick olver
audit committee
lawton fitt chairman
dick olver
ken olisa
nandan nilekani
remuneration committee
ian strachan chairman
penny hughes
ed kozel
04 05 06
07 08
09
11 10 12
08
01 02 03
28 directors 29 governance
directors
niall fitzgerald kbe chairman
chairman of the nominations committee he is
chairman of the nelson mandela legacy trust
uk and chairman of the board of trustees of the
british museum niall cochairs the investment
climate facility icf for africa and is a trustee of
the leverhulme trust niall chairs the international
business council of the world economic forum
and is a member of the world economic forum
foundation board he is a member of various
advisory bodies including the president of south
africa’ s international investment advisory council
the advisory board of t singhua university and the
advisory board of spencer stuart he is a senior
advisor to morgan stanley international his past
appointments include chairman of the conference
board 2003–2005 and cochairman of the
t ransatlantic business dialogue 2004–2005 non
executive director of merck 2000–2003 ericsson
2000–2002 bank of ireland 1990–1999 and the
prudential corporation 1992–1999 president of
the advertising association 2000–2005 age 61
thomas tom glocer ceo
previously ceo of reuters information 2000 and
president and senior company ofﬁcer reuters
america 1998–2000 appointed ceo reuters
latin america in 1997 after serving in reuters legal
department from 1993 formerly practised law in
new york paris and t okyo with davis polk 
wardwell member of the corporate council of
the whitney museum the madison council of the
library of congress the leadership champions
group education of business in the community
the advisory board of the judge institute of
cambridge university and the corporate advisory
board of the t ate former nonexecutive director
of instinet group age 47
david grigson cfo
joined reuters in august 2000 from emap plc
where he was group finance director and
chairman of emap digital he is a qualiﬁed
chartered accountant david sits on the
implementation board and culture board of
legacy 2020 formerly held senior ﬁnance roles 
in the uk and us at saatchi and saatchi plc
1984–1989 held a number of ﬁnancial positions
at esso uk 1980–1984 former nonexecutive
director of instinet group and former chairman 
of radianz age 52
devin wenig coo
previously president business divisions
2003–2006 president investment banking 
brokerage services 2001–2003 joined reuters in
1993 as corporate counsel reuters america and
held a number of senior management positions
before being appointed president investment
banking  brokerage services in january 2001
also a nonexecutive director of nastech 
pharmaceutical company and a former non
executive director of instinet group age 40
lawton fitt nonexecutive director
chairman of the audit committee nonexecutive
director of ciena corporation and citizen
communications senior adviser and member of
the board of advisers at gsc partners director
and trustee of reuters foundation previously 
a partner and managing director of goldman
sachs group inc trustee of several notforproﬁt
organisations including contemporary arts centres
in new york and berlin former secretary chief
executive of the royal academy of arts age 53
penelope penny hughes 
nonexecutive director
member of the remuneration committee non
executive director of the gap inc skandinaviska
enskilda banken home retail group plc molton
brown limited and a member of the advisory
board of bridgepoint capital former president
coca cola great britain and ireland former non
executive director of bodyshop international plc
1994–2000 enodis plc 1996–2001 sc johnson
2002–2004 webangel 2000–2003 trinity mirror
plc 1999–2005 and vodafone plc 1998–2006
age 47
edward ed kozel nonexecutive director
member of the remuneration committee chief
executive of skyrider also a nonexecutive
director of yahoo and net work appliance former
nonexecutive director of cisco systems inc
2000–2001 where he worked from 1989–2000 
in a number of roles including chief t echnology
ofﬁcer and senior vice president for business
development also a former nonexecutive
director of tibco software inc 2000–2001
and narus inc 1999–2003 before 1989 he
worked with sri international in california age 51
sir deryck maughan nonexecutive director
managing director of kohlberg kravis roberts 
co and chairman of kkr asia he was formerly
chairman and ceo of citigroup international 
and salomon brothers inc he is a nonexecutive
director of glaxosmithkline plc and blackrock inc
as well as serving on the boards of directors of
carnegie hall lincoln center and nyu medical
center he served as vice chairman of the new
york stock exchange from 1996 to 2000 age 59
nandan nilekani nonexecutive director
member of the audit committee chief executive
of infosys a worldleading provider of it consulting
and services since march 2002 nandan was one of
the founders of infosys and has served as a director
of the company since 1981 he is a member of the 
world economic forum foundation board vice
chairman of the conference board member of 
the national knowledge commission india
member of the national advisory group on
ecommerce cochairman of the iit bombay
heritage fund and a member of the board of
governors of iit bombay former chairman of the
government of india’ s it t ask force for the power
sector former member of the subcommittee of
the securities and exchange board of india and
former member of the reserve bank of india’ s
advisory committee on corporate governance
age 51
kenneth ken olisa nonexecutive director
member of the audit committee founder and
chairman of restoration partners limited and a
nonexecutive director of biowisdom and open
t ext corporation former chairman 2000–2006
and ceo of interregnum plc which he founded 
in 1992 he worked for wang laboratories
1981–1992 and was general manager of wang
europe africa and the middle east 1990–1992
his career began at ibm 1974–1981 former 
nonexecutive director of various information
technology companies and former postal services
commissioner he is a liveryman of the worshipful
company of information t echnologists a fellow
of the british computer society chairman of
homeless charity thames reach a governor 
of the peabody trust and a director and trustee 
of reuters foundation age 55
richard dick olver nonexecutive director
member of the audit committee member of the
nominations committee and senior independent
director chairman of bae systems plc since july
2004 he worked for bp plc and was deputy
group chief executive 2003–2004 and ceo of 
bp exploration  production division 1998–2002
and former deputy chairman of tnkbp in russia 
a fellow of the royal academy of engineering
and a member of the trilateral commission 
a guardian of new hall school age 60
ian strachan nonexecutive director
chairman of the remuneration committee
member of the nominations committee non
executive director of transocean inc johnson
matthey plc xstrata plc and rolls royce group
plc former chairman of instinet group former
nonexecutive director of harsco corporation
deputy chairman of invensys plc 1999–2000 and
chief executive ofﬁcer of btr plc 1996–1999
former deputy chief executive ofﬁcer
1991–1995 and chief financial ofﬁcer of rio
tinto plc 1987–1991 also a former non
executive director of commercial union plc 
1991–1995 age 63
reuters group plc annual review 2006 30 summary remuneration report
reuters group plc annual review 2006
remuneration policy
summary remuneration report
the board has overall responsibility for deciding the framework of executive
remuneration and its cost in doing so it must take account of any
recommendations from the remuneration committee through formal 
terms of reference the board has delegated to the committee
• oversight of the speciﬁc remuneration packages for each of the executive
directors and
• consideration of executive remuneration issues generally including the 
use of equity incentive plans which affect the interests of shareholders
the committee consists solely of nonexecutive directors the board has
decided that all of them are independent as deﬁned by nasdaq
executive directors
the remuneration committee believes that reuters remuneration policy should
be marketcompetitive related to business performance and should support 
the best interests of shareholders in practical terms this means that the reward
structure for executive directors is designed to attract motivate and retain 
highcalibre individuals capable of successful leadership the remuneration
committee aims to ensure that the majority of executive remuneration is 
variable and performancerelated with a signiﬁcant portion linked to share 
price performance and delivered in shares this policy will apply in 2007 and
is expected to continue in future years
this chart shows the relative weight of basic salary annual bonus and the
expected value of equity incentive plans for each executive director in 2006
as shown in the chart above approximately three quarters of the reward
package for executives is performancerelated
the company’ s personal shareholding policy requires each executive director to
build and maintain a personal equity stake worth twice his basic salary within ﬁve
years all executive directors are above or are approaching this level of personal
shareholding
basic salary and beneﬁts
the main reference point in setting executive directors’ salaries is companies in the
ftse100 other than the ﬁve largest and the ﬁve smallest companies in this group
these companies have been selected to provide a stable comparator group which 
is relevant to the company’ s position in the market this group is reviewed annually
to conﬁrm that it is still appropriate salaries earned in 2006 are shown in the 
table below
2006
salary
£000’s
tom glocer 842
david grigson 469
devin wenig 454
market practice noncash beneﬁts are provided to executive directors and 
the chairman
annual performancerelated bonus
the committee sets performance targets annually tom glocer is entitled to a
maximum bonus of 150 of base salary and david grigson and devin wenig 
are each entitled to a maximum bonus of 125 of base salary the executive
directors’ annual bonus potential will remain the same in 2007 for 2006 the
performance targets were focused 80 on ﬁnancial performance trading proﬁt
1

revenue and free cash ﬂow and 20 on customer satisfaction measures in
february 2007 the committee reviewed 2006 performance against the speciﬁed
targets and decided that the executive directors had earned bonuses of 91 of
bonus potential
the 2006 bonus awards are shown in the table below
2006
bonus
£000’s
tom glocer 1149
david grigson 534
devin wenig 516
for 2007 the performance targets will be based solely on ﬁnancial performance
trading proﬁt revenue and free cash ﬂow there is a proﬁt threshold based 
on trading proﬁt below which no bonuses will be paid the remuneration
committee reviews the business plan and establishes this threshold each year
pensions
all executive directors participate in deﬁned contribution pension arrangements
tom glocer participates in reuters us pension arrangements and is entitled to a
pension allowance of 25 of his base salary he is entitled to a lump sum death
inservice beneﬁt of four times basic salary
david grigson is a member of the reuters retirement plan in the uk and is
entitled to a contribution in respect of pension beneﬁts equal to 24 of salary up
to a cap of £108600 he is entitled to a lump sum deathinservice beneﬁt of four
times basic salary
devin wenig participates in reuters us pension arrangements and is entitled to
a pension allowance of 6 of his base salary he is entitled to a lump sum death
inservice beneﬁt of 1 million
equity incentive plans
overview executive directors and other senior managers are entitled to
participate in the sharerelated incentive schemes operated by the company as
detailed below the committee reviews the schemes annually to ensure that
they reﬂect best practice and are aligned to the company’s business plan the
committee has reconﬁrmed its 2005 decision to continue to operate the long
term incentive plan ltip and the discretionary share option plan dsop for
executive directors awards are subject to speciﬁc performance conditions in
2006 the committee decided to increase the proportion of performance shares
and to reduce the number of share options awarded
ltip reuters has operated the current longterm incentive plan since 1998
contingent share awards are made annually to executive directors and to the senior
managers who are most accountable for the performance of the company before
2006 the vesting of awards was based wholly on reuters t otal shareholder return
tsr relative to other ftse100 companies since 2006 half the award has been
based on reuters tsr relative to other companies in the ftse100 and half is based
on the aggregate level of adjusted proﬁt before tax
2
pbt achieved over the three
year performance period these measures were selected because growth in proﬁt 
is a key element of the company’ s longterm strategy and relative tsr provides a
market measure of the company’ s success in delivering against its strategy tsr
performance is measured independently before being reviewed by the committee
and the committee reviews the comparator group annually while endorsing
relative tsr as a measure the committee recognises that reuters does not fall
naturally into any one of the existing ftse industrial sectors the committee
continues to believe that the ftse 100 rather than one individual sector or a
bespoke peer group remains the most appropriate peer group for comparison 
in respect of the tsr performance test no shares vest if reuters tsr is below the
median of the comparator group at median one third of the shares vest and for
upperquartile performance all shares vest there is proportionate vesting of awards
if reuters tsr falls between the median and the upper quartile vesting of 50 
basic salary annual bonus lti
tom glocer
david grigson
devin wenig
0 25 50 75 100
1 trading proﬁt is calculated by excluding the following from operating proﬁt from continuing
operations restructuring charges associated with fast forward and acquisitions impairments
and amortisation of intangibles acquired via business combinations investment income proﬁt
from disposal of subsidiaries and fair value movements
2 adjusted proﬁt before tax is calculated as proﬁt before tax from continuing operations before
impairments and amortisation of business combination intangibles investment income proﬁt on
disposals and fair value movements amortisation of intangibles is a process of spreading the
cost of an intangible asset such as customer relationships over its useful life in the business 31 governance
reuters group plc annual review 2006
of the ltip awards is subject to the pbt test and depends on the level of pbt
achieved by reuters over the whole performance period the committee sets 
a range of pbt performance at the beginning of each performance period 
taking into account the plans and prospects for the business and shareholder
expectations the minimum level at which one third of the awards will vest will be
at least equal to the level that would be achieved with an 8 compound annual
growth rate over the performance period the maximum pbt level at which all
shares will vest represents a challenging but potentially achievable target for 
the business shares vest on a proportionate basis if actual pbt falls between 
the minimum and maximum of the preset range
the 2006 awards which are subject to the performance conditions detailed
above for tom glocer david grigson and devin wenig were 500000 shares
200000 shares and 250000 shares respectively
in 2007 the awards for tom glocer david grigson and devin wenig which are
also subject to the performance conditions detailed above will be 500000
shares 200000 shares and 300000 shares respectively
dsop a global discretionary stock option plan was adopted by the committee 
in october 2000 and approved by shareholders in april 2001 it aims to reward
growth in earnings and in the share price since 2004 participation has been
conﬁned to executive directors and members of the senior management team
the committee divides participants’ annual entitlements into two awards
normally made following the announcement of preliminary annual and halfyearly
results as a result of changes in 2006 which apply to 2006 and future awards
options only vest to the extent that the following conditions are met over the three
years following grant
• minimum 6 a year growth in adjusted eps
1
will be required for 50 of 
options to vest
• 9 a year growth will be required for 100 of options to vest
• for growth between 6 and 9 options will vest on a proportionate basis
executive directors are only allowed to exercise 50 of the vested options after
the initial threeyear period they will only be allowed to exercise the remaining
options in two equal tranches one and two years later
the 2006 share option awards for tom glocer david grigson and devin wenig
were 1250000 options 500000 options and 650000 options respectively
in 2007 the share option awards for tom glocer david grigson and devin
wenig will be 1250000 options 500000 options and 750000 options
respectively
executive directors in common with other employees may participate in the
company’s savingsrelated share option arrangements for uk and usbased
employees this takes the form of a save as you earn plan for the 2006 offer 
the ﬁxed monthly saving amount was set at a maximum of £100 per month with 
a threeyear savings period
performance graph
reuters tsr for the ﬁve years to 31 december 2006 compared with the return
achieved by the ftse100 index of companies is shown below as reuters is 
a member of the ftse100 the committee believes it is the most appropriate
market index for comparison the calculations assume that dividends have 
been reinvested
service contracts
the company’s policy is for executive directors to have service contracts with
notice periods of not more than one year
notice to be given date of service contract
tom glocer by tom glocer 23 july 2001
90 days without cause
30 days with cause
by the company
30 days without cause
immediately with cause
devin wenig 12 months 17 february 2003
david grigson 12 months 21 june 2001
in each case the notice period is equivalent to the unexpired term of the
contract in the event of companyinstigated termination amounts up to 
a maximum of 12 months’ salary annual bonus and 12 months’ pension
contributions are payable in addition in the event of a nonfault termination
tom glocer retains the beneﬁt of any outstanding share plan awards as if his
employment had not ended tom glocer and his family also retain the life
assurance and private healthcare beneﬁts provided by reuters for one year
following termination on a change of control of the company all the executive
directors are entitled to terminate their contracts on one month’s notice unless
the acquiring party has within three months of the change of control agreed 
to adopt and uphold the reuters trust principles all executive directors have
contractual terms that restrict their ability to work for a deﬁned list of competitor
companies for a period of time these provisions are in place to protect
intellectual property and commercially sensitive information
external appointments
reuters recognises that executive directors may be invited to become non
executive directors of other companies or to become involved in charitable 
or public service organisations and that these appointments can broaden 
the knowledge and experience of directors to the beneﬁt of the company
accordingly it is reuters policy to approve such appointments provided there 
is no conﬂict of interest and the commitment required is not excessive devin
wenig was the only executive director who received fees for an external
directorship during 2006 he received fees of 20250 4500 shares of restricted
stock and 9500 options in his capacity as director of nastech pharmaceutical
company
chairman and nonexecutive directors
the chairman’s and the nonexecutive directors’ ordinary remuneration 
is proposed by the board and approved by the shareholders at the agm in
deciding appropriate fee levels the board takes into account the remuneration
arrangements of chairmen and nonexecutive directors of other uk listed
companies of a similar size and complexity
as chairman niall fitzgerald receives an annual fee of £500000 this fee is ﬁxed
until 1 october 2007 the company does not provide a pension contribution to
him niall fitzgerald and the nonexecutive directors have letters of
engagement rather than service contracts
current annual fee levels for the nonexecutive directors are shown in the 
table below
2006
fees
£000’s
basic 50
senior independent director 5
chairing the audit committee 15
chairing the remuneration committee 10
chairing the nominations committee 5
2
0
jan 02 jan 03 jan 04 jan 05 jan 06 dec 06
140
35
70
105
reuters ftse
1 adjusted eps is calculated as basic eps from continuing operations before impairments and
amortisation of intangibles acquired via business combinations investment income fair value
movements disposal proﬁtlosses and related tax effects
2 niall fitzgerald has waived his £5000 nominations committee chairman fee 32 summary remuneration report continued
reuters group plc annual review 2006
directors’ remuneration for 2006 audited
the disclosures required by part 3 of schedule 7a to the companies act 1985 ‘the auditable part’ are contained within this section
2006 2005
compensation
salary for loss
fees bonus beneﬁts
1
allowance
2
of ofﬁce total total
£000 £000 £000 £000 £000 £000 £000
niall fitzgerald kbe
3  4
500 – 3 – – 503 523
lawton fitt 53
6
–– 35
5
–8875
penny hughes 50–––– 50 50
ed kozel 50–– 35
5
–8580
sir deryck maughan 50 – – 20
5
–7014
ken olisa
16
50–––– 50 51
dick olver 68
7
–––– 68 70
charles sinclair
15
na–––– na 55
ian strachan 60
8
–––– 60 246
13
tom glocer
14
842 1149 274
9
– – 2265 1966
david grigson 469 534 4
10
80
10
– 1087 839
devin wenig 454 516 20
11
11
11
– 1001 639
total emoluments of directors
12
2646 2199 301 181 – 5327 4608
notes
all amounts have been rounded up to the nearest thousand
the following conversion rate was used us182 £1 this was the average rate in effect during 2006
1 items included under beneﬁts are those provided as goods and services received during the year
2 items included under allowances are contractual beneﬁts which are paid in cash rather than as goods and services during the year
3 noncash beneﬁts received by niall fitzgerald consist of chauffeur beneﬁts of £2120
4 niall fitzgerald has waived his £5000 nominations committee chairman fee
5 the £35000 paid to lawton fitt and ed kozel and £20000 to sir deryck maughan represent travel allowances to attend uk board meetings
6 fees paid to lawton fitt include £2154 in respect of her position as chairman of the audit committee from 9 november 2006
7 fees paid to dick olver include £12829 in respect of his position as chairman of the audit committee until 9 november 2006 and his fee of £5000 in respect of his position as the senior 
independent director
8 fees paid to ian strachan include £10000 in respect of his position as chairman of the remuneration committee
9 noncash beneﬁts received by t om glocer included accommodation costs of £210085 company car and healthcare beneﬁts totalling £29217 longterm disability insurance of £2500 and family travel 
of £31219
10 noncash beneﬁts received by david grigson included healthcare beneﬁts of £1935 and longterm disability insurance of £1400 cash allowances consisted of a car allowance of £7420 and 
a retirement allowance of £72180
11 noncash beneﬁts received by devin wenig consisted of healthcare beneﬁts of £19757 cash allowances consisted of a car allowance of £10549 devin wenig’s salary is paid in us dollars and 
the total amount reﬂected in the table is contractually split between his role as executive director and chief operating ofﬁcer
12 the total aggregate emoluments for the directors for the period 1 january 2006 to 30 december 2006 were £5327m the total emoluments for 2005 were £4608m
13 in 2005 the fees paid to ian strachan included 350000 in respect of his position as a nonexecutive director chairman of instinet group £50000 in respect of his position as nonexecutive director
and £4489 as chairman of the remuneration committee from 20 july 2005
14 during the year a group company settled certain personal expenses on behalf of tom glocer the amount due from tom glocer at 31 december 2006 which was the maximum outstanding during 
the year was £3720 no interest was charged tom glocer repaid the amount after year end
15 charles sinclair resigned as a director on 6 december 2005
16 £8333 of ken olisa’s nonexecutive director fee was paid directly to interregnum plc
other senior managers’ remuneration
2006 2005
compensation
salary for loss
fees bonus beneﬁts allowance of ofﬁce total total
£000 £000 £000 £000 £000 £000 £000
other senior managers as a group 17 persons 2005 6 persons 3247 3304 212 256 – 7019 4616
notes
all amounts have been rounded up to the nearest thousand
the following conversion rates were used us 182£1 swiss franc 23£1 hong kong 1418£1 these were the average rates in effect during 2006 33 governance
reuters group plc annual review 2006
directors’ pensions audited
tom glocer david grigson and devin wenig participate in deﬁned contribution
pension arrangements tom glocer participates in reuters us pension
arrangements and is entitled to a pension allowance of 25 of his base salary
during 2006 and 2007 he is entitled to a lump sum deathinservice beneﬁt of
four times basic salary
david grigson is a member of the reuters retirement plan in the uk and is
entitled to a contribution in respect of pension beneﬁts equal to 24 of salary up
to a salary cap of £108600 he is entitled to a lump sum deathinservice beneﬁt
of four times basic salary
devin wenig participates in reuters us pension arrangements and is entitled to
a pension allowance of 6 of his base salary he is entitled to a lump sum death
inservice beneﬁt of 1 million
contributions and allocations including the cost of life cover in respect of these
directors in 2006 were
the information shown complies with requirements under both the uk listing
authority and the directors’ remuneration report regulations 2002
the total amount of contributions or accruals made in 2006 to provide pension
and similar beneﬁts for the directors was £395854 2005 £307310 and for the
executive directors and the other senior managers as a group was £1178386
2005 £847251
these aggregate ﬁgures also include an accrual of £124000 and £139000
respectively for the investment returns within the us executive pension
arrangements these investment returns are calculated based on each
individual’s notional fund choices made by reference to actual investment funds
and the actual investment returns achieved on these funds
company
contribution in
respect of period
age £000
tom glocer 47 214
david grigson 52 30
devin wenig 40 28
directors’ interests in ordinary shares
the total interests of the current directors in issued share capital and in shares
underlying options and incentive plans are shown below as at 9 march 2007 no
director or senior manager beneﬁcially owns 1 or more of reuters issued share
capital interests in ordinary shares excluding options and interests in longterm
incentive plans disclosed above held at 1 january 2006 and 31 december 2006
are also shown for directors in ofﬁce at 31 december 2006 directors were the
beneﬁcial owners of all shares except for 16875 shares held by david grigson’s
family members and 52451 shares held by a trust of which tom glocer and his
family are beneﬁciaries
interests at interests at
interests at 9 march 2007
1 january 2006 31 december 2006 longterm
shares
1
shares shares incentives options
niall fitzgerald kbe 50000 80000 80000 – – 
tom glocer 372145 401345 401345 3192599 6551858
david grigson 63430 67630 67630 763468 1766122
devin wenig 105843 105843 105843 813468 2158671
lawton fitt 25000 25000 25000 – – 
penny hughes – 2392 2392 – – 
ed kozel 7500 7500 7500 – – 
sir deryck maughan –– –– – 
nandan nilekani
3
nana –––
ken olisa 2550 2550 2550 – – 
dick olver 10000 10000 10000 – – 
ian strachan 15500 15500 15500 – – 
other senior managers as a group 
17 persons
2
327718 415678 394611 2704925 3108040
none of the directors has notiﬁed the company of an interest in any other shares or other transactions or arrangements which require disclosure
1 or date of appointment if later than 1 january 2006
2 other senior managers as a group were 16 persons at 31 december 2006 and 17 persons at 9 march 2007 on 15 june 2006 the glt was created and replaced the group management committee 
on 31 december 2006 julie holland geert linnebank and susan taylormartin stepped down from the glt and john alcantara lee ann daly and david schlesinger were appointed on 1 january 2007
david craig was appointed to the glt on 1 march 2007
3 nandan nilekani joined the board as nonexecutive director on 1 january 2007
on 12 march 2007 awards under the 2004 ltip shares were released to the executive directors and senior managers on 12 march 2007 shares were released to senior managers from the march 2005
rsp and on 15 march 2007 shares were released to senior managers from the march 2006 rsp 
on 13 march 2007 awards of 500000 300000 and 200000 shares under the ltip were made to tom glocer devin wenig and david grigson respectively on the same day share options awards of
625000 375000 and 250000 were made to tom glocer devin wenig and david grigson respectively
on 13 march 2007 aggregate awards of 1177680 under the ltip and 731032 share options were made to other senior managers as a group
on behalf of the board
ian strachan
chairman of the remuneration committee 15 march 2007 34 summary operating and f ﬁnancial review
reuters group plc annual review 2006
group performance
summary results 2006 2005 2004
year to 31 december £m £m £m
revenue 2566 2409 2339 
operating costs 2351 2251 2187
other operating income 41 49 42
operating proﬁt 256 207 194
net ﬁnance costs 15 12 12
proﬁt on disposal of associates 
joint ventures and availableforsale 
ﬁnancial assets 76 38 203
share of posttax lossesproﬁt 
from associates and joint ventures 4 511
proﬁt before tax 313 238 396
taxation 20 9 40
proﬁt for the year from continuing 
operations 293 229 356
proﬁt for the year from discontinued 
operations 12 253 19
proﬁt for the year 305 482 375
basic eps 236p 326p 260p
adjusted eps 171p 138p 118p
revenue costs and proﬁt 2006 2005 actual underlying 2004
year to 31 december £m £m change change £m
recurring 2363 2235 6 4 2158
usage 132 104 26 24 92
outright 71 70 3 4 89
total revenue 2566 2409 7 5 2339
operating costs 2351 2251 4 2187
operating proﬁt 256 207 24 194
operating margin 10 9 – 8
trading costs 2258 2075 9 7 2013
trading proﬁt 308 334 8 11 326
trading margin 12 14 – – 14
revenue
fullyear revenue grew 65 to £2566 million 2005 £2409 million exchange
rate movements accounted for 03 percentage points of this growth and
acquisitions mainly the fullyear impact of the 2005 acquisition of telerate
accounted for 14 percentage points of revenue growth 
on an underlying basis adjusting for exchange rate movements and the impact
of acquisitions and disposals revenue grew by 48 core plus initiatives
contributed 13 percentage points £32 million to revenue growth all four
elements of core plus – electronic trading highvalue content new enterprise
services and new markets – contributed to revenue growth
sales of additional products the 2006 price increase and recoveries exchange
fees and specialist data accounted for 35 percentage points of growth the key
drivers of volume growth were new sales and migrations to reuters 3000 xtra
reuters knowledge mainly to investment management ﬁrms enterprise
datafeeds and trade and risk management software
revenue grew in all divisions and in all geographical regions constant currency
revenue growth of 62 for 2006 was ahead of our target given in the 2005
annual report and form 20f 
operating costs and trading costs
total operating costs were £2351 million an increase of 4 from 2005 the
drivers of this increase are largely explained by the movement in trading costs
trading costs totalled £2258 million in 2006 2005 £2075 million up 9 on
2005 new investment in core plus growth and transformation initiatives net of
early savings contributed £109 million to cost growth in 2006 inﬂation added
approximately 3 to base costs and additional costs of £21 million were
incurred to invest in making our product delivery more resilient acquisitions
mainly telerate added a further £30 million and data recoveries costs added 
a further £25 million offsetting these key drivers of cost increases were savings
from the fast forward programme totalling £80 million as forecast in the 
2006 outlook
trading cost increases were partially offset by much lower fast forward
restructuring and acquisition integration costs total restructuring charges in
2006 were £13 million compared to £112 million in 2005 2005 charges included 
£94 million for fast forward restructuring programme which ﬁnished at the end
of 2005 and £18 million for telerate acquisition integration the £13 million
charged in 2006 relates only to the integration of acquisitions mainly telerate
operating proﬁt and trading proﬁt
operating proﬁt totalled £256 million in 2006 2005 £207 million an increase 
of £49 million over 2005 largely reﬂecting the lower fast forward restructuring
costs trading proﬁt was £308 million in 2006 2005 £334 million trading proﬁt
was largely driven by revenue growth the last tranche of fast forward savings
continued tight cost control and £10 million of beneﬁt from acquisitions
however these beneﬁts were more than offset by the £77 million net new
investment to drive core plus the business delivered an operating proﬁt 
margin of 10 2005 9 and a trading margin of 12 2005 14
proﬁt for the year from continuing operations
proﬁt for the year from continuing operations was £293 million 2005 £229
million the yearonyear increase of £64 million is largely due to the improved
operating proﬁt discussed above and the increase in proﬁts from asset disposals
the sale of the majority of our stake in factiva realised a proﬁt of £76 million
whereas the £38 million of disposal proﬁts in 2005 came largely from further sales
of our stake in tibco software inc tsi 
net ﬁnance costs of £15 million increased by £3 million over the previous year
reﬂecting the net outﬂow of cash for the share buyback programme and special
contributions towards funding the majority of the deﬁcit position on two uk
deﬁned beneﬁt pension schemes 
income from our associates and joint ventures in 2006 generated a loss of 
£4 million compared to a proﬁt in 2005 of £5 million the losses in 2006 
largely reﬂected the expected initial losses in reuters new investments in
fxmarketspace and times now along with setup costs incurred to establish
fxmarketspace proﬁts in 2005 largely reﬂected the results of factiva which
ceased to be accounted for as a joint venture in october 2006
the tax charge for the year was £20 million compared to £9 million in 2005 
as in 2005 the current year has beneﬁted from the settlement of prioryear 
tax matters
proﬁt for the year from discontinued operations
we have no activities that must be classiﬁed as discontinued operations in 2006
an additional gain of £12 million has been recognised in 2006 arising from the
disposal of instinet group in 2005 compared to the £253 million proﬁt recognised
in 2005 the 2005 result was largely made up of the posttax proﬁt of £191 million
on the disposal of instinet group and £68 million proﬁt after tax from instinet
group’ s business operations before its sale in december 2005 35 financials
earnings per share
proﬁt for the year was £305 million 2005 £482 million resulting in basic eps 
of 236p down 9p from the previous year mainly due to the decrease in proﬁts
from disposals for the period adjusted eps was 171p in 2006 up 24 from 
the previous year reﬂecting lower net restructuring charges and a reduction in
the number of shares in circulation due to the share buyback programme
summarised cash ﬂow and free cash ﬂow
cash generated from continuing operations was £311 million compared to 
£268 million in 2005 the yearonyear improvement of £43 million was driven 
by lower restructuring charges than in 2005 and savings achieved under the 
fast forward programme it was also driven by a movement in working capital
outﬂow of £50 million though excluding the contribution of £187 million towards
funding pension deﬁcits working capital improved signiﬁcantly
free cash ﬂow from continuing operations was £225 million 2005 £88 million
this reﬂects lower cash restructuring charges and management action to
improve working capital partially offset by higher capital expenditure cash tax
and interest charges movements in working capital were £111 million positive
although some of this improvement was due to timing around yearend cash
ﬂows which will reverse in 2007 
trading cash conversion ie trading cash ﬂow divided by trading proﬁt in 2006
was 111 2005 77 with the increase in capital expenditure more than offset
by working capital improvements
net debt was £333 million compared to net funds of £253 million in 2005 
a movement of £586 million the signiﬁcant movements in net debt include
• free cash inﬂows of £225 million as noted above
• special contributions of £187 million towards funding the deﬁcit in two uk
deﬁned beneﬁt pension schemes
• the ongoing cost of the share buyback programme amounting to 
£527 million
• dividend payments of £134 million and
• net outﬂow from acquisitions and disposals of £2 million including £79 million
from the disposal of factiva
dividends
dividends paid in 2006 totalled £134 million the ﬁnal dividend to be proposed
in respect of 2006 is 69p per share an increase of 12 on the previous year
reﬂecting our continued conﬁdence in the future performance of our business
the total dividend in respect of 2006 is 11p an increase over 2005 of 10 
we are committed to maintaining a progressive dividend policy which reﬂects
our longterm earnings potential while moving towards minimum dividend
cover of at least two times based on adjusted earnings
balance sheet
the net assets of the group are £172 million a reduction of £339 million on the
previous year this reduction mainly reﬂects the return of funds to shareholders
through the share buyback programme
during 2006 we made the following acquisitions and investments
• application networks – a leading risk management software provider
• fxmarketspace – a joint venture with the cme to create a centrally cleared
global foreign exchange trading system and 
• timesnow – a 26 stake in an indian tv news channel
we sold the majority of our 50 stake in factiva to our joint venture partner 
dow jones for £79 million
2007 outlook
• in 2007 we expect to deliver underlying revenue growth of 6 or better 
in line with our plans for strong sustainable revenue growth in the medium
term assuming continued growth in the ﬁnancial services industry
• trading margins are expected to increase to 13–14 in 2007 putting us on
track to achieve our mediumterm trading margin target of 17–20
• we expect to keep capital expenditure in 2007 at similar levels to 2006 
• currency had little effect on trading proﬁt in 2006 but the impact of sterling
strength against the euro and us dollar is expected to be more material in
2007 if current rates persist this is because major sources of revenue growth
are typically dollar priced while the size of reuters dollardenominated cost
base has reduced
• we will actively manage our capital structure to maintain a strong investment
grade rating of bbbbaa1 and to the extent that we generate cash surplus
to our needs we will continue to seek to return that cash to shareholders
based on current investment plans reuters expects to increase the buyback
during 2007 to £400–£425 million which includes the £250 million remaining
of the £1 billion buyback announced in july 2005
nongaap measures
a number of measures used in the above commentary and elsewhere in this
review are ‘nongaap’ ﬁgures which are business performance measures used
to manage the business that supplement the ifrsbased headline numbers
these include underlying change trading costs trading proﬁt trading cash
ﬂow adjusted eps free cash ﬂow and net debtnet funds brief descriptions
of these terms are provided below 
underlying change is calculated by excluding the impact of currency ﬂuctuations
and the results of acquisitions and disposals
constant currency change is calculated by excluding the impact of currency
ﬂuctuations
trading costs are calculated by excluding the following from operating costs
from continuing operations restructuring charges associated with reuters
completed business transformation plans including fast forward and
acquisitions impairments and amortisation of intangibles acquired via business
combinations and fair value movements included in operating costs and
adding back foreign currency gains and other income both of which are
included in other operating income
trading proﬁt is calculated by excluding the following from operating proﬁt from
continuing operations restructuring charges associated with fast forward and
acquisitions impairments and amortisation of intangibles acquired via business
combinations investment income proﬁts from disposals of subsidiaries and fair
value movements
trading margin is trading proﬁt expressed as a percentage of revenue
trading cash ﬂow is calculated by including capital expenditure and excluding
the following from cash generated from continuing operations restructuring
cash ﬂows associated with completed business transformation plans which
include fast forward and acquisitions cash effect of derivatives used for
hedging purposes and cash ﬂows which are either discretionary in nature or
unrelated to ongoing recurring operating activities such as special contributions
toward funding deﬁned beneﬁt pension deﬁcits acquisitions and disposals and
dividends paid out by reuters
adjusted eps is calculated as basic eps from continuing operations before
impairments and amortisation of intangibles acquired via business
combinations investment income fair value movements disposal proﬁtslosses
and related tax effects
free cash ﬂow measures cash ﬂows from continuing operations other than those
which are either discretionary in nature or unrelated to ongoing recurring
operating activities such as special contributions toward funding deﬁned beneﬁt
pension deﬁcits acquisitions and disposals and dividends paid out by reuters
net debtnet funds represents cash cash equivalents and shortterm deposits
net of bank overdrafts and other borrowings
reuters group plc annual review 2006 this summary ﬁnancial statement including the summary operating and
f ﬁnancial review and summary remuneration report was approved by the
directors on 15 march 2007 and signed on their behalf by tom glocer and 
david grigson this summary ﬁnancial statement does not contain sufﬁcient
information to allow as full an understanding of the results of the group and
state of affairs of the group and of its policies and arrangements concerning
directors’ remuneration as would be provided by the full annual accounts and
reports members requiring more detailed information have the right to obtain
free of charge a copy of the company’s legal full accounts and reports if you
have not received the full annual report and form 20f  but wish to do so you
can get a copy free of charge from the investor relations department or through
the internet at aboutreuterscomreportsar2006 you may also elect to receive
the full annual report and form 20f for all future years the auditors have
issued an unqualiﬁed report on the ﬁnancial statements and also audited part 
of the directors’ remuneration report their report contained no statement
under sections 2372 or 2373 of the companies act 1985
summary consolidated income statement
for the year ended 31 december
2006 2005 2004
£m £m £m
revenue 2566 2409 2339
operating costs 2351 2251 2187
other operating income 41 49 42
operating proﬁt 256 207 194
finance income 72 41 15
finance costs 87 53 27
proﬁt on disposals of associates joint ventures and availableforsale ﬁnancial assets 76 38 203
share of posttax lossesproﬁts from associates and joint ventures 4 511
proﬁt before tax 313 238 396
taxation 20 9 40
proﬁt for the year from continuing operations 293 229 356
proﬁt for the year from discontinued operations 12 253 19
proﬁt for the year 305 482 375
attributable to
equity holders of the parent 305 456 364
minority interest – 26 11
earnings per share
from continuing and discontinued operations
basic earnings per ordinary share 236p 326p 260p
diluted earnings per ordinary share 231p 317p 254p
from continuing operations
basic earnings per ordinary share 226p 163p 254p
diluted earnings per ordinary share 222p 159p 248p
 shares of posttax lossesproﬁts from associates and joint ventures includes a tax charge of £2 million 2005 £1 million 2004 £2 million
dividends paid and proposed during the year were £134 million 2005 £140 million paid and proposed 2004 £140 million paid and proposed
36 summary ﬁnancial statement
reuters group plc annual review 2006 37 financials
reuters group plc annual review 2006
summary consolidated statement of recognised income and expense
for the year ended 31 december
2006 2005 2004
£m £m £m
proﬁt for the year 305 482 375
actuarial gainslosses on deﬁned beneﬁt plans 6 48 205
exchange differences taken directly to reserves 95 118 48
exchange differences taken to the income statement on disposal of assets – 2 6
fair value gainslosses on availableforsale ﬁnancial assets 6 15 –
fair value gains on availableforsale ﬁnancial assets taken to the income statement on disposal of assets – 73 –
fair value gainslosses on net investment hedges 34 39 –
fair value gains taken to the income statement on disposal of net investment hedges – 14 –
tax on items taken directly to or transferred from equity 4 14 35
net losses not recognised in income statement 53 59 212
total recognised income for the year 252 423 163
attributable to
equity holders of the parent 252 374 166
minority interest – 49 3
the 2005 balance sheet has been restated to recognise irrevocable commitments to repurchase shares during close periods
1
as a liability the impact of recognising these commitments is to increase
current liabilities and to decrease shareholders’ equity by £59 million at 31 december 2005
fair value
2
gains and losses arise as a result of the application of ias 39 by the group with effect from 1 january 2005 the adoption of ias 39 resulted in an increase in equity at 1 january 2005 of 
£129 million of which £2 million was attributable to the minority interest ie other shareholders of instinet group in 2005 and 2004
summary consolidated balance sheet
at 31 december
restated
2006 2005 2004
assets £m £m £m
noncurrent assets 1314 1179 1025
current assets 606 957 1410
noncurrent assets classiﬁed as held for sale – 1 145
total assets 1920 2137 2580
liabilities
current liabilities 913 797 1249
noncurrent liabilities 835 829 714
liabilities directly associated with noncurrent assets classiﬁed as held for sale – – 47
total liabilities 1748 1626 2010
net assets 172 511 570
shareholders’ equity
share capital 496 467 455
other reserves 1738 1692 1755
retained earnings 1414 1736 1671
total parent shareholders’ equity 172 511 371
minority interest in equity – – 199
total equity 172 511 570
the 2005 balance sheet has been restated to recognise irrevocable commitments to repurchase shares during close periods as a liability the impact of recognising these commitments is to increase
current liabilities and to decrease shareholders’ equity by £59 million at 31 december 2005
1 a period during which a company may have pricesensitive information and is therefore unable to trade in its shares to avoid trading during close periods reuters places irrevocable orders with its
brokers before close periods begin
2 a fair value is an amount that knowledgeable and willing parties would be prepared to pay in an arm’s length transaction 38 summary ﬁnancial statement continued
reuters group plc annual review 2006
independent auditors’ statement to the members 
of reuters group plc
we have examined the summary ﬁnancial statement which comprises the
summary consolidated income statement summary consolidated balance
sheet summary consolidated statement of recognised income and expense
summary consolidated cash flow statement and the summary directors’
remuneration report set out on pages 36–38 and 32–33
respective responsibilities of directors and auditors
the directors are responsible for preparing the annual review in accordance
with united kingdom law  
our responsibility is to report to you our opinion on the consistency of the
summary ﬁnancial statement within the annual review with the full annual
ﬁnancial statements the directors report and the directors’ remuneration
report and its compliance with the relevant requirements of section 251 of 
the companies act 1985 and the regulations made thereunder 
we also read the other information contained in the annual review and consider
the implications for our statement if we become aware of any apparent
misstatements or material inconsistencies with the summary ﬁnancial statement
this statement including the opinion has been prepared for and only for the
company’s members as a body in accordance with section 251 of the companies
act 1985 and for no other purpose  we do not in giving this opinion accept or
assume responsibility for any other purpose or to any other person to whom this
statement is shown or into whose hands it may come save where expressly
agreed by our prior consent in writing
basis of opinion
we conducted our work in accordance with bulletin 19996 the auditors’
statement on the summary ﬁnancial statement issued by the auditing practices
board our reports on the company’s full annual ﬁnancial statements describe
the basis of our audit opinions on those ﬁnancial statements and the directors’
remuneration report
opinion
in our opinion the summary ﬁnancial statement is consistent with the full annual
ﬁnancial statements the directors report and the directors’ remuneration
report of reuters group plc for the year ended 31 december 2006 and
complies with the applicable requirements of section 251 of the companies 
act 1985 and the regulations made thereunder
pricewaterhousecoopers llp
chartered accountants and registered auditors
london
15 march 2007
summary consolidated cash ﬂow statement
for the year ended 31 december
2006 2005 2004
£m £m £m
cash generated from operations 311 271 280
net interest receivedpaid 19 6 11
tax paid 34 24 43
net cash ﬂow from operating activities 258 253 226
net acquisitions and disposals including availableforsale ﬁnancial assets 2 206 384
net purchases of property plant and equipment and intangible assets 223 182 70
dividends received 3 55
net cash ﬂow from investing activities 222 29 319
proceeds from issue of shares 32 10 6
share buyback 527 223 –
increasedecrease in shortterm deposits 196 248 105
increasedecrease in borrowings 270 144 225
equity dividends paid to shareholders 134 140 140
equity dividends paid to minority interests – 23 –
net cash ﬂow from ﬁnancing activities 555 272 464
exchange lossesgains on cash and cash equivalents 13 66 33
net decreaseincrease in cash and cash equivalents 532 76 48
cash and cash equivalents at the beginning of the year 637 561 513
cash and cash equivalents at the end of the year 105 637 561
the auditors’ statement is not covered by the clear
english standard as it is not a reuters document 39
reuters group plc annual review 2006
information for shareholders
ordinary shares 
registrar lloyds tsb registrars provides a free online service for reuters group
shareholders which gives direct access to a range of information and practical
help visit their website wwwshareviewcouk for further information
low cost share dealing service please contact jpmorgan cazenove limited
postal dealing department 20 moorgate london ec2r 6da tel 020 7155
5155 for further information
dividends
ordinary shareholders have received the following dividends in respect of each
ﬁnancial year
pence per share
interim final total
2002 3856151000
2003 3856151000
2004 3856151000
2005 385 615 1000
2006
1
410 690 1100
note
1 proposed the ﬁnal dividend in respect of 2006 is payable on 3 may 2007 to holders of ordinary
shares on the register at 16 march 2007 
american depositary shares 
each american depositary share ads represents six ordinary shares 
ads dividends 
ads holders are eligible for all stock dividends or other entitlements accruing 
on the underlying reuters group plc shares and receive cash dividends in us
dollars dollar amounts paid to ads holders depend on the sterlingdollar
exchange rate at the time of payment dividends are normally paid twice a year
dividend cheques are mailed directly to the ads holder on the payment date if
the adss are registered directly with reuters us depositary dividends on adss
that are registered with brokers are sent to the brokers who forward them to
ads holders reuters us depositary is deutsche bank 
pence per share cents per ads
interim final total interim final total
dividends
2002 385 615 1000 3605 5846 9451
2003 385 615 1000 3608 6488 10096
2004 385 615 1000 4094 7024 11118
2005 385 615 1000 4118 6820 10938
2006 410 690 1100 4687 – –
note
1 the ﬁnal dividend in respect of 2006 is payable on 3 may 2007 to holders of ordinary shares on
the register at 16 march 2007 and on 10 may 2007 to holders of adss on the record at 16 march
2007 and will be converted into us dollars from sterling at the rate prevailing on 10 may 2007 
form 20f 
reuters group plc is subject to the information requirement of the us securities
laws applicable to foreign companies and accordingly ﬁles an annual report on
form 20f  which corresponds to the form 10k ﬁled by usbased companies
and other information with the us securities and exchange commission sec
copies of the annual report and form 20f are available from the investor
relations department reuters group plc electronic copies can be accessed
through the internet on aboutreuterscomreportsar2006 or from the sec’s
edgar database via the sec’s home page wwwsecgov
forwardlooking statements
this annual review contains certain forwardlooking statements within the
meaning of the united states private securities litigation reform act of 1995
with respect to the company’s ﬁnancial condition results of operations and
business and management’s strategy plans and objectives in particular all
statements that express forecasts expectations and projections with respect to
certain matters including trends in results of operations margins growth rates
overall ﬁnancial market trends product releases the impact of interest rates 
or exchange rates anticipated cost savings and synergies and the successful
completion of transformation programmes strategy plans acquisitions and
disposals are all forwardlooking statements these statements involve risk 
and uncertainty because they relate to events and depend on circumstances 
that may occur in the future several factors could cause actual results and
developments to differ materially from those expressed or implied by these
forwardlooking statements these factors include but are not limited to
• we may not be able to realise the anticipated beneﬁts of our core plus
growth and transformation strategy
• unfavourable conditions in ﬁnancial markets
• the impact of currency and interest rate ﬂuctuations may have a signiﬁcant
effect on our reported revenue and earnings
• difﬁculties or delays that we may experience in developing or responding 
to new customer demands or launching new products
• we are dependent on third parties for the provision of certain network 
and other services
• our business may be adversely affected if our networks or systems 
experience any signiﬁcant failures or interruptions or cannot 
accommodate increased trafﬁc
• we are exposed to a decline in the valuation of companies in which we 
have invested
• the impact of signiﬁcant competition or structural changes in the ﬁnancial
information and trading communities
• changes in the regulatory or competitive environment
• we may be exposed to adverse governmental action in countries from 
which we report
• we may not be able to realise the beneﬁts of existing or future acquisitions
joint ventures investments or disposals
• we operate in an increasingly litigious environment especially in the area 
of patent and other intellectual property claims
for additional information please see ‘risk factors’ in the reuters group plc
annual report and form 20f for the year ended 31 december 2006 copies 
of the annual report and form 20f are available on request from the investor
relations department reuters group plc the reuters building south
colonnade canary wharf london e14 5ep or through the internet at
aboutreuterscomreportsar2006 any forwardlooking statements made by 
the company or on its behalf speak only as of the date they are made we do 
not undertake to update any forwardlooking statements
information for shareholders
and forwardlooking statements
information financial diary for 2007
thursday 1 march
results for full year 2006 announced
wednesday 14 march
ordinary shares and adss go exdividend
wednesday 25 april
first quarter trading statement issued
thursday 26 april
annual general meeting
time 1130 am
venue the reuters building 
south colonnade canary wharf
london e14 5ep
thursday 3 may
final dividend for 2006 payable to 
ordinary shareholders on the register 
as at 16 march 2007
thursday 10 may
final dividend payable to ads holders 
on the record as at 16 march 2007
tuesday 31 july
results for ﬁrst six months of 2007
announced
wednesday 8 august
ordinary shares and adss go exdividend
wednesday 5 september
interim dividend for 2007 payable to 
ordinary shareholders on the register 
as at 10 august 2007
wednesday 12 september
interim dividend payable to ads holders 
on the record as at 10 august 2007
thursday 25 october
third quarter trading statement issued
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40 financial diary and where to ﬁnd us
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Summary:
 our goal is to accelerate the growth 
in revenues begun last year while
bringing a greater proportion to the
bottom line in proﬁts
2006 was a year of considerable
achievement for reuters in last year’s
annual report i stated that the key drivers
for 2006 would be “to deliver on our 
core plus investments to accelerate our
revenue growth to continue to really
focus on customer service and to maintain
the good cost control of the last few
years” i am very happy to say that we
achieved each of these goals and more 
during 2006 we raised the pace of our core
plus programme and produced £32 million
of new revenues from the four initiatives
electronic trading highvalue content new
enterprise services and new markets this
permitted us to exceed our 2006 target of
one percentage point of additional revenue
growth from core plus 
in terms of overall revenue growth we
exceeded market expectations by delivering
65 growth at actual rates 48 underlying
which was very gratifying to me personally 
it was not so long ago that many in the
market while acknowledging our ability to
cut costs doubted that we could restart
growth after a long period of retrenchment 
2006 was also a year in which our signiﬁcant
investments to transform and simplify the
company began to take shape these
investments will continue through 2007 with
a focus on making our services more resilient
finally despite the increased investment in
core plus growth and transformation activities
we continued to hold a tight line on cost 
looking ahead to 2007
as i write this review we are already well into
2007 – a year that has begun strongly for
reuters our principal goal this year is to
accelerate the growth in revenues begun 
last year while bringing a greater proportion
down to the bottom line in proﬁts this will be
achieved in part as revenues from core plus
increase through the year  we’ll also continue
our focus on improving customer service
through investment in reuters infrastructure
and through instilling a service culture at
reuters t owards this goal i am personally
leading a drive to simplify our processes 
our technology and our organisation
in my recent meetings with customers around
the world i have been encouraged both that
general market conditions appear to be
favourable and that the speciﬁc areas we are
targeting under core plus are expected to be
in high demand in particular the growth of
electronic trading is now indisputable
serving both people and machines
reuters has always served the needs of
individual users in the ﬁnancial community 
as well as the machines that power their
ﬁrms however this distinction is increasingly
important reuters suite of trading room
systems risk management platforms
enterprise datafeeds and transaction services
is perfectly aligned to the growth in machine
based activities such as algorithmic trading
at the same time the human beings who are
ceo’s review
reuters group plc annual report and form 20f 2006
04 active in the ﬁnancial services industry require
evermore sophisticated and comprehensive
sets of information and analytics as they seek
to differentiate their performance reuters 
is uniquely skilled to serve this twin need
managing our portfolio
capitalising on our strong position in the
treasury market reuters entered into a joint
venture with the chicago mercantile
exchange cme in 2006 to launch a new
electronic system to trade foreign currencies
the venture called fxmarketspace is
launching in march 2007 and will offer the
market the ability to trade foreign exchange
on a cleared central counterparty basis like
an exchange for the ﬁrst time i view this as 
a great example of reuters innovative streak 
at work as well as proof that we will not just
complacently sit and milk our best assets 
but seek to lead the market in new directions
we also moved swiftly in 2006 to sell the
majority of our 50 interest in the factiva
joint venture to our partner dow jones 
we concluded that we could achieve the
most value for our shareholders by selling
this deep online library of content before
competition from free search engines 
eroded factiva’ s advantage
media and journalism
our media business performed very well in
2006 across both its agency and consumer
units in the agency business we beneﬁted 
as western publishers and broadcasters
retrenched and continued to pull back their
journalists to home base and newspapers 
in particular scrambled to add video to their
websites meanwhile domestic demand in
asia and the middle east grew strongly 
our directtoconsumer unit which mainly
derives its revenues from advertising carried
on reuterscom and associated mobile and
online properties grew 39 in 2006
at the core of what we do at reuters is the
work of our 2400 journalists we increased
our editorial staff by over 130 in 2006 and
produced a slew of exclusives and ‘beats’
from the ongoing war in iraq to the world
cup competition to the israellebanon
conﬂict in my presentation to the israel
business conference excerpted on reuters
corporate website i discuss how reuters
responded to a serious breach of our news
photography standards which occurred 
in lebanon 
the bravery quality and motivation of
reuters journalists around the world remain
a great inspiration to me more generally it 
is the diversity intelligence compassion and
determination of our people that make my
job as ceo so personally rewarding 
tom glocer
ceo
reuters group plc annual report and form 20f 2006
business review 05