Pearson

Annual Report and Accounts 2010

Notes to the consolidated financial statements

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10. Property, plant and equipment

All figures in £ millions Land and buildings Plant and equipment Assets in course of construction Total
Cost
At 1 January 2009 355 839 7 1,201
Exchange differences (21) (55) (1) (77)
Additions 14 46 7 67
Disposals (2) (41) (43)
Acquisition through business combination 1 17 18
Reclassifications 1 5 (6)
At 31 December 2009 348 811 7 1,166
Exchange differences 8 28 36
Additions 21 55 12 88
Disposals (4) (58) (62)
Acquisition through business combination 8 25 33
Disposal through business disposal (48) (201) (249)
Reclassifications 3 5 (8)
At 31 December 2010 336 665 11 1,012
All figures in £ millions Land and buildings Plant and equipment Assets in course of construction Total
Depreciation
At 1 January 2009 (170) (608) (778)
Exchange differences 11 42 53
Charge for the year (17) (68) (85)
Disposals 2 39 41
Acquisition through business combination (9) (9)
At 31 December 2009 (174) (604) (778)
Exchange differences (4) (19) (23)
Charge for the year (16) (66) (82)
Disposals 3 58 61
Acquisition through business combination (3) (13) (16)
Disposal through business disposal 28 164 192
At 31 December 2010 (166) (480) (646)
Carrying amounts
At 1 January 2009 185 231 7 423
At 31 December 2009 174 207 7 388
At 31 December 2010 170 185 11 366

Depreciation expense of £10m (2009: £12m) has been included in the income statement in cost of goods sold, £7m (2009: £7m) in distribution expenses and £52m (2009: £45m) in administrative and other expenses. In 2010 £13m (2009: £21m) relates to discontinued operations.

The Group leases certain equipment under a number of finance lease agreements. The net carrying amount of leased plant and equipment included within property, plant and equipment was £12m (2009: £15m).