COMBINED FINANCIAL STATEMENTS > NOTES TO THE COMBINED FINANCIAL STATEMENTS Cash flow statement  (continued) 11 Short term Cash investments Borrowings 2003 2002 £m £m £m £m £m Net borrowings at 1 January 169 401 (3,302) (2,732) (3,229) (Decrease)/increase in cash (105) – – (105) 72 Increase in short term investments – 165 – 165 55 Decrease in borrowings – – 82 82 95 Change in net borrowings resulting from cash flows (105) 165 82 142 222 Borrowings in acquired businesses – – (9) (9) – Inception of finance leases – – (13) (13) (16) Exchange translation differences 4 4 232 240 291 Net borrowings at 31 December 68 570 (3,010) (2,372) (2,732) Reconciliation of net borrowings Short term Cash investments Borrowings 2003 2002 € m € m € m € m € m Net borrowings at 1 January 259 613 (5,052) (4,180) (5,296) (Decrease)/increase in cash (152) – – (152) 114 Increase in short term investments – 240 – 240 88 Decrease in borrowings – – 119 119 151 Change in net borrowings resulting from cash flows (152) 240 119 207 353 Borrowings in acquired businesses – – (13) (13) – Inception of finance leases – – (19) (19) (25) Exchange translation differences (10) (44) 691 637 788 Net borrowings at 31 December 97 809 (4,274) (3,368) (4,180) Net borrowings comprise cash and short term investments, loan capital, finance leases, promissory notes and bank and other loans, and are analysed further in notes 19 to 22. REED ELSEVIER ANNUAL REPORTS & FINANCIAL STATEMENTS 2003 57