22nd Sep 2005 07:02
Gresham Computing PLC22 September 2005 For immediate release 22 September 2005 Gresham Computing plc ("Gresham" or "the Company") Restatement of Financial Information under International Financial ReportingStandards ("IFRS") The Company provides the following unaudited restatement of previously issuedfinancial information resulting from the transition to IFRS. Interim financial statements for the period ended 30 June 2005 have beenprepared under IFRS, together with IFRS comparatives, and will be announcedseparately today. -ends- For further information, please contact: Gresham Computing plc +44 (0)1489 555500Chris Errington, Finance Director Financial DynamicsJames Melville-Ross +44 (0)207 831 3113Cass Helstrip GRESHAM COMPUTING PLCRESTATEMENT OF FINANCIAL INFORMATION UNDER IFRS INDEX General informationPresentation of financial informationPrimary statements restated under IFRS Group income statement Group balance sheet Group cash flow statement Group statement of recognised income and expense Group statement of changes in equityReconciliation of income statement from UK GAAP to IFRS Period ended 30 June 2004 summary Period ended 30 June 2004 analysis Year ended 31 December 2004 summary Year ended 31 December 2004 analysisReconciliation of balance sheet and equity from UK GAAP to IFRS At transition, 1 January 2004 summary At transition, 1 January 2004 analysis At 30 June 2004 summary At 30 June 2004 analysis At 31 December 2004 summary At 31 December 2004 analysisNotes to the restatement of financial information under IFRS 1. First time adoption of IFRS 2. Summary of significant accounting policies 3. Brief explanation of adjustments from UK GAAP to IFRS GRESHAM COMPUTING PLC GENERAL INFORMATION Gresham Computing plc (the "Company") is a public limited company incorporatedin the United Kingdom under the Companies Act 1985. In these financialstatements, "Group" means the Company and all its subsidiaries. GreshamComputing plc has prepared its primary financial statements under UK generallyaccepted accounting principles ("UK GAAP"). From 2005 the Group is required toprepare its consolidated financial statements in accordance with InternationalAccounting Standards ("IAS") and International Financial Reporting Standards ("IFRS") as adopted by the European Union. References to IFRS throughout thisdocument refer to the application of both IAS and IFRS that are expected to bein issue for the year ending 31 December 2005. The first Annual Report under IFRS will be for the year ending 31 December 2005and the first interim results reported under IFRS accounting policies expectedto be in place at year end will be for the period ended 30 June 2005. Thisdocument explains how the Group's reported performance and financial positionare affected by this change. PRESENTATION OF FINANCIAL INFORMATION The Group financial statements have been prepared in accordance with IFRS thatare expected to be in issue for the year ending 31 December 2005, and arepresented in UK Sterling. This restatement document has been prepared on the basis that all IFRS's,International Financial Reporting Interpretation Committee ("IFRIC")interpretations, current IASB exposure drafts will be issued as final standardsand adopted by the European Commission. The failure of the European Commissionto adopt these standards in time for financial reporting in 2005, or the issueof further interpretations by IFRIC in advance of the reporting date, couldresult in the need to change the basis of accounting or presentation of certainfinancial information from that presented in this document. As permitted under IFRS 1, first time adoption of IFRS, management has electedto restate comparative information for the Financial Instrument standards IAS 32and IAS 39. The UK GAAP financial information contained in this document does not constitutestatutory accounts as defined in section 240 of the Companies Act 1985. Theauditors have issued unqualified opinions on the Group's UK GAAP financialstatements for the years ended 31 December 2003 and 31 December 2004, which havebeen delivered to the Registrar of Companies. The restatement of IFRS financialinformation contained in this document has not been audited. GRESHAM COMPUTING PLC NOTES TO THE RESTATEMENT OF FINANCIAL INFORMATION UNDER IFRS 1 FIRST TIME ADOPTION OF IFRS In 2005 the Group will adopt IFRS for the first time. Previously the Groupreported under UK generally accepted accounting principles ("UK GAAP"). The Group has applied IFRS 1 First Time Adoption of International FinancialReporting Standards to provide a starting point for reporting under IFRS. TheGroup's date of transition to IFRS is 1 January 2004 and all comparativeinformation in the financial statements is restated to reflect the Group'sadoption of IFRS, except where otherwise required or permitted under IFRS 1. IFRS 1 requires an entity to comply with each IFRS effective at the reportingdate for its first IFRS financial statements. As a general principle, IFRS 1requires the standards effective at the reporting date to be appliedretrospectively. However, retrospective application is prohibited in some areas,particularly where retrospective application would require judgements bymanagement about past conditions after the outcome of the particular transactionis already known. A number of optional exemptions from full retrospectiveapplication of IFRSs are granted where the cost of compliance is deemed toexceed the benefits to users of the financial statements. Where applicable, theoptions selected by management are set out in the explanatory notes below. The adoption of IFRS 1 has resulted in the following changes to the Group'saccounting policies: Cumulative Translation Differences Translation differences arise from the consolidation of the results of foreignoperations at average rate and the balance sheet at year-end rate of exchange.UK GAAP does not require these translation differences to be separatelyidentified and accounted for in subsequent disposals of foreign operations.Under IFRS the translation differences arising are separately recorded inequity, net of any movements on related hedging instruments. On disposal of aforeign operation, the cumulative translation differences for that foreignoperation are transferred to the income statement as part of the gain or loss ondisposal. Under IFRS 1, the Group is not required to record cumulative translationdifferences arising prior to the transition date. The Group has utilised thisexemption and all cumulative translation differences are deemed to be zero as at1 January 2004. All subsequent disposals will exclude any translationdifferences arising prior to the date of transition. Business Combinations Under IFRS 1, the Group may elect not to apply IFRS 3 Business Combinationsretrospectively to transactions occurring prior to the date of transition toIFRS and management has elected to take this exemption. The Group has utilisedthis exemption and the carrying amount of goodwill in the opening IFRS balancesheet is that recorded under UK GAAP at the date of transition. As from the dateof transition, goodwill is not amortised but subject to annual tests forimpairment. Goodwill set off against reserves or amortised prior to the date oftransition ceases to exist under IFRS and is therefore not recycled to theincome statement on any subsequent disposal of the business to which it relates. Derivative Financial Instruments The IFRS standards relevant to the accounting for, and presentation of,financial instruments are IAS 32 Financial Instruments: Disclosure andPresentation, and IAS 39 Financial Instruments: Recognition and Measurement. Thedifferences between IFRS and UK GAAP which may be most relevant to the Group infuture periods are the requirement to recognise all derivatives on the balancesheet and the detailed requirements that have to be met to qualify for hedgeaccounting. The Group retains a policy of giving due consideration to hedging the netinvestment position of foreign subsidiaries and covering the transactional riskof foreign currency purchases but undertook no such hedging activity in anyperiod under review. The stricter designation, documentation requirements andeffectiveness testing needed to qualify for hedge accounting under IFRS meansthat any future transactions undertaken as hedges may not qualify for the sametreatment under IFRS as they would have done under UK GAAP. Share-based Payment IFRS requires the cost of all share-based payments to be charged against profitsover their respective vesting periods. Share based-payments include executiveand employee share option schemes. The accounting cost is the fair value at thedate of grant calculated using an option pricing model. Under UK GAAP, the costsof share awards are charged against profits over the vesting period based ontheir intrinsic value, if any. Under IFRS 1, the Group is required to restate its comparative years for allgrants of equity instruments made on or after 7 November 2002 that have notvested by 1 January 2005. The Group has not applied IFRS 2 to grants made beforethis date. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The significant accounting policies adopted in the preparation of the Group'sIFRS financial statements are set out below: Basis of Preparation The financial statements have been prepared on the historical cost basis otherthan derivative financial instruments that have been measured at fair value. The preparation of financial statements in conformity with generally acceptedaccounting principles requires the use of estimates and assumptions that affectthe reported amounts of assets and liabilities and disclosure of contingentassets and liabilities at the date of the financial statements and the reportedamounts of revenues and expenses during the reporting period. Although theseestimates are based on management's best knowledge of current events andactions, actual results ultimately may differ from those estimates. Consolidation The Group financial statements include the financial statements of the Companyand all the subsidiaries during the years reported for the periods during whichthey were members of the Group. Intercompany balances between group businessesare eliminated on consolidation. Adjustments are made to bring into line anydissimilar accounting policies that may exist. On acquisition, assets and liabilities of subsidiaries are measured at theirfair values at the date of acquisition with any excess of the cost ofacquisition over this value being capitalised as goodwill. Revenue Revenue comprises sales of products and services to third parties at amountsinvoiced net of trade discounts and rebates, excluding sales taxes, when, thesignificant risks and rewards of ownership of the products and services havepassed to the buyer and can be reliably measured and reasonably assured ofrecoverability. Revenue on software licences is recognised when all of the following criteriaare met: o Persuasive evidence of an arrangement exists, such as a signed contract or purchase order;o Delivery has occurred and no future elements to be delivered are essential to the functionality of the delivered element;o The fee is fixed or determinable; ando Collectibility is probable. Revenue from the provision of professional services, such as implementation,training and consultancy, is recognised as the services are performed. Revenue from subscription services and maintenance is recognised rateably overthe period of the contract. Larger contracts for the delivery of solutions with multiple elements, typicallyinvolving licence, professional services and maintenance, are unbundled andrevenue is recognised based on the accounting policy applicable to eachconstituent part. Revenue is recognised on long-term contracts as that proportion of the totalcontract value which costs incurred to date bear to total expected costs forthat contract. Profit is recognised on long-term contracts, if the finaloutcome can be assessed with reasonable certainty, by including in the incomestatement revenue and related costs as contract activity progresses. Long-term contracts Cumulative costs incurred net of amounts transferred to cost of sales, lessprovision for contingencies and anticipated future losses on contracts, areincluded as long-term contract balances. The long-term contract balances arerecognised as costs in the income statement in line with the recognition ofincome from the associated contracts. Foreign Currencies The presentational and functional currency of Gresham Computing plc is £Sterling. Balance sheet items of overseas companies are translated intoSterling at the year-end rates of exchange. Profit and loss items and the cashflows of overseas subsidiary undertakings are translated at the average ratesfor the year. Goodwill and fair value adjustments arising on the acquisition of a foreignentity are treated as assets and liabilities of the foreign entity andtranslated at the closing rate. Monetary assets and liabilities denominated in foreign currencies areretranslated at the functional currency rate of exchange ruling at the balancesheet date. The following are recorded as movements in the currency translation reserves:exchange differences on the translation at closing rates of exchange of overseasopening net assets and the differences arising between the translation ofprofits at average and closing exchange rates. Goodwill Goodwill recognised under UK GAAP prior to the date of transition to IFRS isstated at net book value as at this date. Goodwill recognised subsequent to 1January 2004, representing the excess of purchase consideration over fair valueof net assets acquired, is capitalised. Goodwill is not amortised but isreviewed for impairment annually. Intangible Fixed Assets Purchased intangibles, including purchased patents, know-how, trademarks,licences and distribution rights are capitalised at cost and amortised on astraight line basis over their estimated useful economic lives. The amortisationof those intangibles acquired as part of a business combination is presentedseparately after trading profits. The estimated useful life of an intangibleasset ranges between 3 and 20 years depending on its nature. Research and Development Expenditure The Group considers that the regulatory, technical and market uncertaintiesinherent in the development of new products and technologies means that internaldevelopment costs should not be capitalised as intangible fixed assets untilcommercial viability of a project is demonstrable and appropriate resource is inplace to launch the product. Research and development expenditure prior to thispoint in time is expensed as incurred. Property, Plant and Equipment Property, plant and equipment is stated at cost less depreciation and provisionfor impairment where appropriate. Freehold land is not depreciated. Freeholdbuildings are depreciated down to their residual value on a straight-line basisat 2% per annum. Short leasehold land and buildings (leases of less than 50years) are depreciated by equal annual instalments over the term of the lease.Plant and equipment is depreciated over lives ranging between 1 and 10 years byequal annual instalments to write down the assets to their estimated disposalvalue at the end of their working lives.Residual values and useful lives are reviewed on an annual basis. Impairment of Assets Goodwill arising on acquisition is allocated to cash-generating units(equivalent to the reported primary business segments). The recoverable amountof the cash-generating unit to which goodwill has been allocated is tested forimpairment annually or when events or changes in circumstance indicate that itmight be impaired. The carrying values of property, plant and equipment, and intangible assets withfinite lives are reviewed for impairment when events or changes in circumstanceindicate the carrying value may be impaired. If any such indication exists, therecoverable amount of the asset is estimated in order to determine the extent ofimpairment loss. Where it is not possible to estimate the recoverable amount ofan individual asset, the Group estimates the recoverable amount of thecash-generating unit to which it belongs. Leasing Commitments Leases are classified as finance leases whenever the terms of the lease transfersubstantially all the risks and rewards of ownership to the Group. All otherleases are classified as operating leases. Assets held under finance leases are capitalised as property, plant or equipmentand depreciated accordingly. The capital element of future lease payments isincluded in borrowings and interest is charged to profit before taxation on areducing balance basis over the term of the lease. Rentals payable under operating leases are charged to income on a straight linebasis over the term of the relevant lease. Taxation The charge for current taxation is based on the results for the year as adjustedfor items which are non-assessable or disallowed. It is calculated using ratesthat have been enacted or substantively enacted by the balance sheet date. Deferred taxation is accounted for using the balance sheet liability method inrespect of temporary differences arising from differences between the carryingamount of assets and liabilities in the financial statements and thecorresponding tax bases used in computation of taxable profit. Deferred tax liabilities are recognised for all taxable temporary differencesexcept in respect of investments in subsidiaries where the Group is able tocontrol the reversal of the temporary difference and it is probable that thetemporary difference will not reverse in the foreseeable future and on theinitial recognition of non-deductible goodwill. Deferred tax assets are recognised to the extent that it is probable that futuretaxable profit will be available against which the temporary difference can beutilised. Their carrying amount is reviewed at each balance sheet date on thesame basis. Deferred tax is measured on an undiscounted basis, and at the tax rates that areexpected to apply in the periods in which the asset or liability is settled. Itis recognised in the income statement except when it relates to items creditedor charged directly to equity, in which case the deferred tax is also dealt within equity. Deferred tax assets and liabilities are offset when they relate to income taxeslevied by the same taxation authority and when the Group intends to settle itscurrent tax assets and liabilities on a net basis. The Group operates in multiple tax jurisdictions around the world and recordsprovisions for taxation liabilities and tax audits when it is deemed probablethat a tax charge will arise and the amount can be reasonably estimated. Post Retirement Benefits Contributions to defined contribution plans are charged to operating profit asthey become payable. Share-based Payments The Group operates executive and employee share schemes. For all grants of shareoptions, the fair value as at the date of grant is calculated using an optionpricing model and the corresponding expense is recognised over the vestingperiod. The expense is recognised as a staff cost and the associated creditentry is made against equity. Contingencies and Provisions Provision is made for contingencies when it is deemed probable that an adverseoutcome will occur and the amount of the loss can be reasonably estimated. Wherethe Group is the plaintiff in pursuing claims against third parties legal andassociated expenses are charged to profit and loss account as incurred. 3 BRIEF EXPLANATION OF ADJUSTMENTS FROM UK GAAP TO IFRS Goodwill amortisation reversal Under UK GAAP, amortisation is charged to the profit and loss account so as towrite off goodwill over its estimated life. Under IFRS, goodwill is notamortised but is reviewed for impairment annually. This adjustment adds backgoodwill previously charged in reported financial statements in reconciling UKGAAP to IFRS. Residual value of property Under UK GAAP, depreciation is charged to the profit and loss account so as towrite freehold property down to its residual value, as at the date capitalised,over its estimated life. Under IFRS, the residual value has been reassessedand, because the residual value of the freehold property exceeds the recordednet book value at transition, the resulting depreciation charge is nil. Thisadjustment adds back depreciation previously charged in reported financialstatements in reconciling UK GAAP to IFRS. Lease incentives Under UK GAAP, rent free periods are amortised over the period from the date ofgrant to the next rent review. Under IFRS, rent free periods are amortised overthe period from the date of grant to the end of the lease. This adjustmentspreads the benefit of rent free periods over the longer period to the end ofthe lease compared to that reported under UK GAAP in financial statements inreconciling UK GAAP to IFRS. Holiday pay Under UK GAAP, provision for holiday pay is a matter of accounting policy andthe Group policy was not to provide for holiday pay. Under IFRS, holiday pay isrequired to be provided. This adjustment reflects the changes in provision forholiday pay in reconciling UK GAAP to IFRS. Share options Under UK GAAP, share option costs are not expensed and the costs of share awardsare charged against profits over the vesting period based on their intrinsicvalue, if any. IFRS requires the cost of all share-based payments to be chargedagainst profits over their respective vesting periods. Share-based paymentsinclude executive and employee share option schemes. The accounting cost is thefair value at the date of grant calculated using an option pricing model. Theexpense is recognised as a staff cost and the associated credit entry is madeagainst equity. This adjustment records the relevant charge for share basedpayments in reconciling UK GAAP to IFRS. Presentational changes Under IFRS, the following presentational changes are required to the incomestatement and balance sheet: (a) Convertible Bond Receivable to show thenon-current elements on the face of the balance sheet rather than in a note and(b) Finance Leases where leases previously treated as operating leases under UKGAAP are now presented as Finance Leases under IFRS with a reclassification ofcosts to finance charges. There is no change to reported income as a result ofeither change. Earnings per share There is no difference between the earnings per share as calculated under UKGAAP and IFRS, except for the change to the attributable loss for the period. Gresham Computing plcRestatement of financial information under IFRSGroup income statement Unaudited Unaudited 6 months ended 12 months ended 30 June 31 December 2004 2004 £'000 £'000 Revenue 6,136 12,398Cost of goods sold (2,789) (5,796)Trading profit 3,347 6,602 Administrative expenses (4,014) (7,867)Finance income 118 217Finance costs (10) (19) Loss before tax (559) (1,067)Taxation 0 305Attributable loss for the period (559) (762) Earnings per shareBasic loss per share - pence (1.13) (1.54)Diluted loss per share - pence (1.13) (1.54) Gresham Computing plcGroup Balance Sheet Unaudited Unaudited Unaudited At At At 30 June 31 December 1 January 2004 2004 2004 £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and equipment 1,442 1,400 1,453Intangible assets 1,156 1,245 1,043Other receivables 0 0 394Deferred tax assets 0 0 0 2,598 2,645 2,890Current assetsTrade and other receivables 7,541 7,640 5,907Cash and cash equivalents 3,411 3,016 4,923 10,952 10,656 10,830 TOTAL ASSETS 13,550 13,301 13,720 EQUITY AND LIABILITIESEquity attributable to equity holders of the parentCalled up equity share capital 2,470 2,479 2,464Share premium account 9,670 9,713 9,639Foreign currency translation reserve (32) (29) 0Retained earnings (3,687) (3,875) (3,142) 8,421 8,288 8,961Non-current liabilitiesFinance leases 43 40 52Deferred income 394 268 477 Current liabilitiesFinance leases 67 61 65Trade and other payables 4,625 4,644 4,165 Total liabilities 5,129 5,013 4,759 TOTAL EQUITY AND LIABILITIES 13,550 13,301 13,720 At At 30 June 31 December 2004 2004 £'000 £'000Net cash outflow from operating activitiesLoss before tax and financing (667) (1,265)Depreciation and amortisation 203 392Share based payment expense 14 29Increase in trade and other receivables (1,240) (1,318)Increase in trade payables and provisions 489 241 Cash outflow from operations (1,201) (1,921)Interest paid (10) (19)Net income taxes received / (paid) (26) (40) Net cash outflow from operating activities (36) (59) Cash flows from investing activitiesInterest received 103 199Disposal of associated undertaking 0 387Capital expenditure (361) (512)Disposal of property, plant and equipment 3 0 Net cash (used in) / generated from investing activities (255) 74 Cash flows from financing activitiesNet proceeds from issue of ordinary share capital 37 89Decrease in obligations under finance leases (40) (81) Net cash (used in) / generated by financing activities (3) 8 Net decrease in cash and cash equivalents (1,495) (1,898)Cash and cash equivalents at beginning of period 4,923 4,923Exchange adjustments (17) (9)Cash and cash equivalents at end of period 3,411 3,016 Gresham Computing plcRestatement of financial information under IFRSGroup Statement of Recognised Income and Expense Unaudited Unaudited 6 months ended 12 months ended 30 June 31 December 2004 2004 £'000 £'000 Exchange differences on translation of foreign operations (32) (29) Net expense recognised directly in equity (32) (29) Attributable loss for the period (559) (762) Total recognised income and expense for the period (623) (820) Unaudited Share Share Currency Retained Total capital premium translation earnings reserves £'000 £'000 £'000 £'000 £'000 31 December 2003 as orginally stated 2,464 9,639 0 (2,797) 9,306Changes in accounting policy relating to the 0 0 0 (345) (345)first time adoption of IFRS 1 January 2004 - restated 2,464 9,639 0 (3,142) 8,961 Exchange differences on translation of foreign 0 0 (32) 0 (32)operationsShare based expense recognised in the income 0 0 0 14 14statementIssue of shares 6 31 0 0 37Attributable loss for the period 0 0 0 (559) (559) At 30 June 2004 2,470 9,670 (32) (3,687) 8,421 Exchange differences on translation of foreign 0 0 3 0 3operationsShare based expense recognised in the income 0 0 0 15 15statementIssue of shares 9 43 0 0 52Attributable loss for the period 0 0 0 (203) (203) At 31 December 2004 2,479 9,713 (29) (3,875) 8,288 * The Statement of changes in Equity is not a primary statement but is includedhere for clarity. It will be presented as a note in the Group's full andinterim 2005 financial statements. Gresham Computing plcRestatement of financial information under IFRS Reconciliation of Loss for the period ended 30 June 2004 The changes in accounting policies had the following effect on the loss reportedfor the period ended 30 June 2004: As reported Accounting under policy changes UK GAAP* under IFRS IFRS £'000 £'000 £'000 Revenue 6,136 0 6,136Cost of goods sold (2,789) 0 (2,789)Trading profit 3,347 0 3,347 Administrative expenses (3,995) (19) (4,014)Amortisation expense (54) 54 0Finance income 118 0 118Finance costs (3) (7) (10) Loss before tax (587) 28 (559)Taxation 0 0 0Attributable loss for the period (587) 28 (559) * the order and description of items presented as "reported under UK GAAP" hasbeen adjusted to ease the direct comparison with IFRS presentation Gresham Computing plcRestatement of financial information under IFRS Reconciliation of Loss for the period ended 30 June 2004Analysis of Accounting Policy Changes Accounting Goodwill Residual Lease Holiday Share Presentational policy amortisation value of incentives pay options changes changes reversal property under IFRS £'000 £'000 £'000 £'000 £'000 £'000 £'000 Revenue 0 0 0 0 0 0 0Cost of goods 0 0 0 0 0 0 0soldTrading profit 0 0 0 0 0 0 0 Administrative 0 29 15 (56) (14) 7 (19)expensesAmortisation 54 0 0 0 0 0 54expenseFinance income 0 0 0 0 0 0 0Finance costs 0 0 0 0 0 (7) (7) Loss before tax 54 29 15 (56) (14) 0 28Taxation 0 0 0 0 0 0 0Attributable loss 54 29 15 (56) (14) 0 28for the period The Accounting Policy Changes are explained in Note 3. Gresham Computing plcRestatement of financial information under IFRS Reconciliation of Profit for the year ended 31 December 2004 The changes in accounting policies had the following effect on the loss reportedfor the year ended 31 December 2004: As reported Accounting under policy changes UK GAAP* under IFRS IFRS £'000 £'000 £'000 Revenue 12,398 0 12,398Cost of goods sold (5,796) 0 (5,796)Trading profit 6,602 0 6,602 Administrative expenses (7,904) 37 (7,867)Amortisation expense (108) 108 0Finance income 217 0 217Finance costs (5) (14) (19) 0Loss before tax (1,198) 131 (1,067)Taxation 305 0 305Attributable loss for the year (893) 131 (762) * the order and description of items presented as "reported under UK GAAP" hasbeen adjusted to ease the direct comparison with IFRS presentation Gresham Computing plcRestatement of financial information under IFRS Reconciliation of loss for the year ended 31 December 2004Analysis of Accounting Policy Changes Goodwill Residual Lease Holiday Share Presentational Accounting amortisation value of incentives pay options changes policy changes reversal property under IFRS £'000 £'000 £'000 £'000 £'000 £'000 £'000 Revenue 0 0 0 0 0 0 0Cost of goods sold 0 0 0 0 0 0 0Trading profit 0 0 0 0 0 0 0 Administrative expenses 0 58 30 (36) (29) 14 37Amortisation expense 108 0 0 0 0 0 108Finance income 0 0 0 0 0 0 0Finance costs 0 0 0 0 0 (14) (14) Loss before tax 108 58 30 (36) (29) 0 131Taxation 0 0 0 0 0 0 0Attributable loss for 108 58 30 (36) (29) 0 131the year The Accounting Policy Changes are explained in Note 3. Gresham Computing plcRestatement of financial information under IFRS Reconciliation of Balance Sheet and Equity at 1 January 2004 The effect of the changes to the Group's accounting policies on the equity ofthe Group at the date of transition, 1 January 2004 was as follows: As reported Accounting under policy changes UK GAAP under IFRS IFRS £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and equipment 1,336 117 1,453Intangible assets 1,043 0 1,043Other receivables 0 394 394Deferred tax assets 0 0 0 2,379 511 2,890Current assetsTrade and other receivables 6,301 (394) 5,907Cash and cash equivalents 4,923 0 4,923 11,224 (394) 10,830 TOTAL ASSETS 13,603 117 13,720 EQUITY AND LIABILITIESEquity attributable to equity holders of the parentCalled up equity share capital 2,464 0 2,464Share premium account 9,639 0 9,639Retained earnings (2,797) (345) (3,142) 9,306 (345) 8,961Non-current liabilitiesFinance leases 0 52 52Deferred income 477 0 477 Current liabilitiesFinance leases 0 65 65Trade and other payables 3,820 345 4,165 Total liabilities 4,297 462 4,759 TOTAL EQUITY AND LIABILITIES 13,603 117 13,720 Goodwill Residual Lease Holiday Share Presentational Accounting amortisation value of incentives pay options changes policy changes reversal property under IFRS £'000 £'000 £'000 £'000 £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and equipment 0 0 0 0 0 117 117Intangible assets 0 0 0 0 0 0 0Other receivables 0 0 0 0 0 394 394Deferred tax assets 0 0 0 0 0 0 0 0 0 0 0 0 511 511Current assetsTrade and other receivables 0 0 0 0 0 (394) (394)Cash and cash equivalents 0 0 0 0 0 0 0 0 0 0 0 0 (394) (394) TOTAL ASSETS 0 0 0 0 0 117 117 EQUITY AND LIABILITIESEquity attributable to equityholders of the parentCalled up equity share capital 0 0 0 0 0 0 0Share premium account 0 0 0 0 0 0 0Retained earnings 0 0 (122) (223) 0 0 (345) 0 0 (122) (223) 0 0 (345)Non-current liabilitiesFinance leases 0 0 0 0 0 52 52Deferred income 0 0 0 0 0 0 0 Current liabilitiesFinance leases 0 0 0 0 0 65 65Trade and other payables 0 0 122 223 0 0 345 Total liabilities 0 0 122 223 0 117 462 TOTAL EQUITY AND LIABILITIES 0 0 0 0 0 117 117 As reported Accounting under policy changes UK GAAP under IFRS IFRS £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and equipment 1,303 139 1,442Intangible assets 1,102 54 1,156Other receivables 0 0 0Deferred tax assets 0 0 0 2,405 193 2,598Current assetsTrade and other receivables 7,541 0 7,541Cash and cash equivalents 3,411 0 3,411 10,952 0 10,952 TOTAL ASSETS 13,357 193 13,550 EQUITY AND LIABILITIESEquity attributable to equity holders of the parentCalled up equity share capital 2,470 0 2,470Share premium account 9,670 0 9,670Retained earnings (3,416) (303) (3,719) 8,724 (303) 8,421Non-current liabilitiesFinance leases 0 43 43Deferred income 394 0 394 Current liabilitiesFinance leases 0 67 67Trade and other payables 4,239 386 4,625 Total liabilities 4,633 496 5,129 TOTAL EQUITY AND LIABILITIES 13,357 193 13,550 Goodwill Residual Lease Holiday Share Presentational Brought Accounting amortisation value of incentives pay options changes forward policy changes reversal property under IFRS £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and 0 29 0 0 0 110 0 139equipmentIntangible assets 54 0 0 0 0 0 0 54Other receivables 0 0 0 0 0 0 0 0Deferred tax assets 0 0 0 0 0 0 0 0 54 29 0 0 0 110 0 193Current assetsTrade and other 0 0 0 0 0 0 0 0receivablesCash and cash equivalents 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL ASSETS 54 29 0 0 0 110 0 193 EQUITY AND LIABILITIESEquity attributable toequity holders of theparentCalled up equity share 0 0 0 0 0 0 0 0capitalShare premium account 0 0 0 0 0 0 0 0Retained earnings 54 29 15 (56) 0 0 (345) (303) 54 29 15 (56) 0 0 (345) (303)Non-current liabilitiesFinance leases 0 0 0 0 0 43 0 43Deferred income 0 0 0 0 0 0 0 0 Current liabilitiesFinance leases 0 0 0 0 0 67 0 67Trade and other payables 0 0 (15) 56 0 0 345 386 Total liabilities 0 0 (15) 56 0 110 345 496 TOTAL EQUITY AND 54 29 0 0 0 110 0 193LIABILITIES As reported Accounting under policy changes UK GAAP under IFRS IFRS £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and equipment 1,241 159 1,400Intangible assets 1,137 108 1,245Other receivables 0 0 0Deferred tax assets 0 0 0 2,378 267 2,645Current assetsTrade and other receivables 7,640 0 7,640Cash and cash equivalents 3,016 0 3,016 10,656 0 10,656 TOTAL ASSETS 13,034 267 13,301 EQUITY AND LIABILITIESEquity attributable to equity holders of the parentCalled up equity share capital 2,479 0 2,479Share premium account 9,713 0 9,713Retained earnings (3,719) (185) (3,904) 8,473 (185) 8,288Non-current liabilitiesFinance leases 0 40 40Deferred income 268 0 268 Current liabilitiesFinance leases 0 61 61Trade and other payables 4,293 351 4,644 Total liabilities 4,561 452 5,013 TOTAL EQUITY AND LIABILITIES 13,034 267 13,301 Goodwill Residual Lease Holiday Share Presentational Brought Accounting amortisation value of incentives pay options changes forward policy changes reversal property under IFRS £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and 0 58 0 0 0 101 0 159equipmentIntangible assets 108 0 0 0 0 0 0 108Other receivables 0 0 0 0 0 0 0 0Deferred tax assets 0 0 0 0 0 0 0 0 108 58 0 0 0 101 0 267Current assetsTrade and other 0 0 0 0 0 0 0 0receivablesCash and cash 0 0 0 0 0 0 0 0equivalents 0 0 0 0 0 0 0 0 TOTAL ASSETS 108 58 0 0 0 101 0 267 EQUITY AND LIABILITIESEquity attributable toequity holders of theparentCalled up equity share 0 0 0 0 0 0 0 0capitalShare premium account 0 0 0 0 0 0 0 0Retained earnings 108 58 30 (36) 0 0 (345) (185) 108 58 30 (36) 0 0 (345) (185)Non-current liabilitiesFinance leases 0 0 0 0 0 40 0 40Deferred income 0 0 0 0 0 0 0 0 Current liabilitiesFinance leases 0 0 0 0 0 61 0 61Trade and other 0 0 (30) 36 0 0 345 351payables Total liabilities 0 0 (30) 36 0 101 345 452 TOTAL EQUITY AND 108 58 0 0 0 101 0 267LIABILITIES This 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