Financial statements - GSK

1 Investor informationFinancial statementsStrategic reportGovernance and remunerationGSK Annual Report 2020 139 Financial statementsIn this sectionDirectors statement of responsibilities 140 Independent Auditor s report 142 Financial statements 154 Notes to the Financial statements 158 Financial statements of GlaxoSmithKline plc prepared under UK GAAP 238 Investor informationFinancial statementsStrategic reportGovernance and remunerationGSK Annual Report 2020 139140 GSK Annual Report 2020 The Directors are responsible for preparing the Annual Report, the Remuneration report and the Group and parent company Financial statements in accordance with applicable law and company law requires the Directors to prepare Financial statements for each Financial year.

2 The Directors are required to prepare the Group consolidated Financial statements in accordance with International Financial Reporting Standards (IFRS), as adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union. In preparing the Group consolidated Financial statements , the Directors have also elected to comply with IFRS as issued by the International Accounting Standards Board (IASB). The Directors have elected to prepare the parent company Financial statements in accordance with United Kingdom Accounting Standards and applicable law (United Kingdom Generally Accepted Accounting Practice). Under company law the Directors must not approve the Financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and its profit or loss for that preparing the Financial statements , the Directors are required to: select suitable accounting policies and then apply them consistently; make judgements and accounting estimates that are reasonable and prudent.

3 State that the Group Financial statements comply with IFRS, as adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union, and IFRS as issued by the IASB, subject to any material departures disclosed and explained in the Group Financial statements ; state with regard to the parent company Financial statements that applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the parent company Financial statements ; and prepare the Financial statements on a going concern basis unless it is inappropriate to presume that the Group and the parent company will continue in Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company s transactions and disclose with reasonable accuracy at any time the Financial position of the Group and to enable them to ensure that the Group Financial statements and the Remuneration report comply with the Companies Act 2006 and Article 4 of the IAS Regulation.

4 They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of fraud and other Group Financial statements for the year ended 31 December 2020, comprising principal statements and supporting notes, are set out in the Financial statements on pages 154 to 237 of this report. The parent company Financial statements for the year ended 31 December 2020, comprising the balance sheet and the statement of changes in equity for the year ended 31 December 2020 and supporting notes, are set out on pages 238 to responsibilities of the auditor in relation to the Financial statements are set out in the Independent Auditor s report on pages 142 to Financial statements for the year ended 31 December 2020 are included in the Annual Report, which is published in printed form and made available on our website.

5 The Directors are responsible for the maintenance and integrity of the Annual Report on our website in accordance with UK legislation governing the preparation and dissemination of Financial statements . Access to the website is available from outside the UK, where comparable legislation may be of the current Directors, whose names and functions are listed in the Corporate Governance section of the Annual Report 2020 confirms that, to the best of his or her knowledge: the Group Financial statements , which have been prepared in accordance with IFRS, as adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union, and IFRS as issued by the IASB, give a true and fair view of the assets, liabilities, Financial position and profit of the Group.

6 And the Strategic report and risk sections of the Annual Report, which represent the management report, include a fair review of the development and performance of the business and the position of the company and the Group taken as a whole, together with a description of the principal risks and uncertainties that it statement of responsibilitiesInvestor informationFinancial statementsStrategic reportGovernance and remunerationGSK Annual Report 2020 141 Disclosure of information to auditorThe Directors in office at the date of this Annual Report have each confirmed that: so far as he or she is aware, there is no relevant audit information of which the company s auditor is unaware; and he or she has taken all the steps that he or she ought to have taken as a Director to make himself or herself aware of any relevant audit information and to establish that the company s auditor is aware of that confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act concern basisPages 51 to 76 contain information on the performance of the Group, its Financial position, cash flows, net debt position and borrowing facilities.

7 Further information, including Treasury risk management policies, exposures to market and credit risk and hedging activities, is given in Note 43 to the Financial statements , Financial instruments and related disclosures . Having assessed the principal risks and other matters considered in connection with the viability statement, the Directors considered it appropriate to adopt the going concern basis of accounting in preparing the Financial controlThe Board, through the Audit & Risk Committee, has reviewed the assessment of risks and the internal control framework that operates in GSK and has considered the effectiveness of the system of internal control in operation in the Group for the year covered by this Annual Report and up to the date of its approval by the Board of 2018 UK Corporate Governance CodeThe Board considers that GlaxoSmithKline plc applies the principles and complies with the provisions of the UK Corporate Governance Code maintained by the Financial Reporting Council, as described in the Corporate Governance section on pages 77 to 110.

8 The Board further considers that the Annual Report, taken as a whole, is fair, balanced and understandable, and provides the information necessary for shareholders to assess the Group s position and performance, business model and required by the Financial Conduct Authority s Listing Rules, the auditor has considered the Directors statement of compliance in relation to those points of the UK Corporate Governance Code which are specified for their ReportThe Annual Report for the year ended 31 December 2020, comprising the Report of the Directors, the Remuneration report, the Financial statements and Additional information for investors, has been approved by the Board of Directors and signed on its behalf bySir Jonathan SymondsChairman8 March 2021 Directors statement of responsibilities continued142 GSK Annual Report 2020 Independent Auditor s report to the members of GlaxoSmithKline plcReport on the audit of the Financial statements1.

9 OpinionIn our opinion: The Financial statements of GlaxoSmithKline plc (the Parent company ) and its subsidiaries (the Group ) give a true and fair view of the state of the Group s and of the Parent company s affairs as at 31 December 2020 and of the Group s profit for the year then ended; The Group Financial statements have been properly prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006, International Financial Reporting Standards (IFRSs) as adopted by the European Union and IFRSs as issued by the International Accounting Standards Board (IASB); The Parent company Financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice including FRS 101 Reduced Disclosure Framework ; and The Financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the Group Financial statements , Article 4 of the IAS have audited the Financial statements which comprise the:Group Consolidated balance sheet as at 31 December 2020; Consolidated income statement for the year then ended; Consolidated statement of comprehensive income for the year then ended.

10 Consolidated statement of changes in equity for the year then ended; Consolidated cash flow statement for the year then ended; and Notes 1 to 46 to the Financial statements , which includes the accounting principles and company Balance sheet as at 31 December 2020; Statement of changes in equity for the year then ended; and Notes A to M to the Financial statements , which includes the accounting principles and Financial reporting framework that has been applied in the preparation