Lombard Risk Management plc Annual report and accounts 2013
Managing collateralised trading.
Enabling regulatory compliance.
Lombard Risk Management plc Annual report and accounts 2013 Lombard Risk Management plc has 
continued to deliver industry-leading 
risk management and regulatory 
compliance software for over 
twenty years.
More recently, Lombard Risk has expanded its 
portfolio of technology solutions to include 
stress testing, transaction reporting and 
management reporting. 
Our award-winning solutions enable the 
financial industry to improve the management 
of counterparty risk, collateral risk, trading risk, 
liquidity risk reporting, global regulatory reporting, 
transaction reporting and the provision of 
internal management information.
Annual report and accounts 2013 Lombard Risk Management plc
In this report
Overview
01 Highlights
02 Lombard Risk at a glance
04 How we work
06 Chairman’s statement
07	 Chief	Executive	Officer’s	statement
11 Financial review
13 Risk analysis
Governance
14 Board of Directors
16 Corporate governance
19 Directors’ report
21 Report of the Audit Committee
22 Report of the Remuneration Committee 
Financial statements
24 Independent auditor’s report
25 Consolidated statement of comprehensive income
26 Consolidated balance sheet
27 Consolidated statement of changes in 
shareholders’ equity
28	 Consolidated	cash	flow	statement
29	 Notes	to	the	financial	statements
46 Independent auditor’s report
47 Company balance sheet
48	 Notes	to	the	Company	financial	statements
52 Company information www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
01
  Revenue £16.8m (2012: £12.8m) of which second half £9.0m 
(2012: £6.4m)
  Licence revenues £8.2m (2012: £6.0m) 
  EBITDA increased 77% to £5.3m (2012: £3.0m)
	 	 Profit	before	tax	£3.9m	(2012:	£2.5m)
  Cash at end of period £1.9m (2012: £0.1m) with net cash 
of £0.2m (2012: net debt of £2.4m)
  33 contracts signed for COREP , of which eleven are new names
	 	 Significant	sale	of	REFORM	platform	to	satisfy	 DF A	and	EMIR	
reporting requirements
	 	 FY	2014	opens	with	record	revenue	backlog	in 	place
	 	 Final	dividend	0.040p	per	share	(2012:	0.035p 	per	share)	
recommended to shareholders
  The Board continues to view the future with optimism
Highlights
Discover our website at 
www.lombardrisk.com 
for up-to-the-minute 
news and investor 
information
Revenue
 £ 16.8m 
+31%
Total comprehensive income
 £ 3.9m 
+56%
Adjusted net cash / (debt)
 £ 0.2m 
+£2.6m
8.7
11.8
1.8
8.9
0.7
(1.2)
12.8
(2.4)
16.8
0.2
2009 2009 2009 2011 2011 2011 2010 2010 2010 2012 2012 2012 2013 2013 2013
(1.1)
1.3
(1.6)
2.5
3.9
Eleven with new customers.
33
contracts signed for 
COREP solution
33
contracts signed for 
COREP solution 2
1
1
2
3
4 5
4
3
6
Annual report and accounts 2013 Lombard	Risk	Management	plc
02
The Lombard Risk integrated product suite enables financial 
institutions to meet risk and regulatory requirements now 
and as they continue to evolve.
W e	are	committed	to	providing	innovative	specialised	products	that	stay	a	step	ahead	
of	complex	collateralised	trading	demands,	changing	market	conditions,	increasing	
regulatory	challenges,	on-going	financial	and	operational	risk	pressures,	and	a	host	
of	other	financial	compliance	mandates.
Lombard Risk
At a glance
ComplianceASSESSOR™
Addressing regulatory risk
–	 Off	the	shelf ,	plug	and	play	facilitates	same	
day	set-up,	yet	can	be	tailored	to	accommodate	
specific	requirements
–	 Ability	to	load	multi-jurisdictional	regulations	
to address cross-border requirements
–	 Searchable,	centralised	library	provide s	“one-stop	
shopping” when seeking applicable regulations
REFORM
®
Adaptable transactional reporting
–	 Event	engine	based	on	core	technolo gy	
building blocks
–	 Satisfies	reporting	requirements	unde r	
Title	VII	of	The	Dodd-F rank	Act
–	 T echnology	suitable	for	EMIR	and	similar	
Asian	reporting	requirements	as	well	as	MiFID2
REPORTER and  
REG-Reporter
Regulatory compliance
– Basel III, EBA / European common reporting 
–	COREP	and	FINREP	–	and	transaction	reporting,	
as 	 well 	 as 	 Solvency 	 II 	 for 	 the 	 insurance 	 marketplace
–	 Regulatory	computation	from	raw	data	
with	comprehensive	capital,	liquidity	and	
large	exposures	engines	as	well	as	detailed	
statistical computations
OBERON
®
 and FIRMAMENT
®
Trade valuation and risk management
–	 Mature,	high	margin	product
– Target clients include Tier 1 and Tier 2 banks, 
service providers and asset managers
– Sales in the UK, US and Asia
–	 F unctional	and	performance	enhancements
COLLINE
®
Integrated collateral management 
and clearing
–	 Multi-agreement,	multi-region	and	C ROS S-
PRODUCT collateral management with real-time 
view	across	product	types
–	 Supports	F utures	Commission	Merchant	(“FCM”)	
and	non-FCM	central	counterparty	CLEARING	
(“CCP ”)	via	dedicated	CCP	dashboard,	workflow	
and reporting
MIS
Dynamic management information suite
–	 Highly	visible	management	information	
in a moment
–	 Easily	scalable	to	fit	business	growth, 	
in	any	direction
–	 Not	restricted	to	any	one	data	model
– High performance instance report viewing
LISA
®
Flagship interface
–	 State-of -the-art	technology	with	a	po werful	and	
attractive web-based graphical user interface, 
LISA	satisfies	new	liquidity	risk	management	
requirements	and	supports	urgent	regulatory	
demands	for	timely	and	reliable	information
–	 Liquidity	Management	Dashboard	provides	
instant view of stressed and unstressed cash 
flows	over	time	and	extensive	reporting	of	
Liquid Asset Buffer composition and utilisation 2
1
1
2
3
4 5
4
3
6
www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
03
1
3
5
2
4
6
Our locations
Offices
London (headquarters)
New	Y ork	and	New	Jersey
Shanghai
Hong Kong
Singapore
Japan
1
3
2
4
Partners/associates
Luxembourg
South Africa
Thailand
Indonesia
Service selection
Lombard Risk also offers 
services in the form of 
training, support, consulting, 
and implementation and 
deployment	related	to	
our products.
Worldwide presence
Lombard	Risk	employs	over	
270 people across the globe 
and has customers in the UK, 
mainland Europe, Africa, the 
Middle	East,	the	Americas,	
Asia and Oceania.
Worldwide presence
Lombard	Risk	employs	over	
270 people across the globe 
and has customers in the UK, 
mainland Europe, Africa, the 
Middle	East,	the	Americas,	
Asia and Oceania.
Service selection
Lombard Risk also offers 
services in the form of 
training, support, consulting, 
and implementation and 
deployment	related	to	
our products.
Talent
Every	staff	member	is	
valued for their contribution 
to	Lombard	Risk’s	ability	to	
deliver	the	very	best	
products and services 
for its customers.
Talent
Every	staff	member	is	
valued for their contribution 
to	Lombard	Risk’s	ability	to	
deliver	the	very	best	
products and services 
for its customers.
Lombard Risk is headquartered in London, 
employs	over	270	people	and	is	rapidly	
expanding,	and	operates	globally	via	
subsidiaries, who both develop and deliver 
its products and a range of services. Annual report and accounts 2013 Lombard	Risk	Management	plc
04 How we work
Our business model
Dedicated to managing risk and regulatory compliance
The	mission	at	Lombard	Risk	is	to	provide	specialised	software	solutions	and	domain	expertise	to	safeguard	financial	
institutions	and	global	enterprises	around	the	world	by	improving	the	management	of	risk	and	regulatory	compliance.	
W e	do	this	by	taking	care	of	our	customers	first	and	foremost	with	a	proven	client	service	approach	and	in-depth	domain	
expertise.	The	partnership	approach	we	take	with	our	customers	and	partners	has	enabled	us	to	achieve	a	customer	retention	
rate	that	is	consistently	high.
The market
Lombard Risk delivers industry-leading risk management and regulatory compliance solutions to the financial services 
industry and large corporations around the world.
Our proven global solutions reduce the risk inherent in collateralised trading operations, enable firms to measure and 
manage liquidity and meet the demands of global regulators.
Our 300+ clients include over 30 of the world’s “Top 50” banks, nearly half of the banks operating in the UK (where 
our corporate headquarters is located), as well as industry-leading banking businesses, investment firms, asset 
managers, hedge funds, fund administrators and large corporations worldwide.
Product and services cycle
Our model is to provide 	high	quality	technology	solutions,	either	directly	or	through	our	partners;	implement 
solutions,	usually	alongside	the	customer;	provide 	on-going	support;	and	maintain the product to a high technical 
specification	and,	where	applicable,	to	satisfy	up-to-date	regulatory	requirements.	All	stages	are	revenue	opportunities.
For over 23 years Lombard Risk has delivered industry-leading global risk 
management and regulatory compliance solutions. T oday, Lombard Risk is one 
of the world’s recognised leading providers of collateral management and clearing, 
liquidity stress testing and analysis, regulatory reporting and compliance, and 
event-driven workflow solutions to financial organisations and large corporations 
around the world. Our proven global solutions reduce the risk inherent in 
collateralised trading operations and the derivatives market, enable firms to 
measure and manage liquidity and meet the demands of global regulators.
Innovation
Industry -leading	
products provide risk 
and	regulatory	solutions	
for	global	financial	
services operations
Scalability
Ability	for	solutions	to	be	
attractive to organisations 
of	any	size;	significant	
data	processing	is	NOT	
an issue
Agility
Adaptable	and	flexible	
business model to suit 
our clients’ requirements 
(eg term licence or 
annual subscription)
Expertise
Significant	pool	of	
business practitioners 
and	experienced	
implementation 
consultants
New and
detailed regulations
continue to surface, 
eg	FINREP ,	FR- Y14
New and
detailed regulations
continue to surface, 
eg	FINREP ,	FR- Y14
New products
and modules to 
current products, eg 
we are investing in 
ComplianceASSESSOR™ 
and 	 COLLINE
® 
Optimisation
New products
and modules to 
current products, eg 
we are investing in 
ComplianceASSESSOR™ 
and 	 COLLINE
® 
Optimisation
Convergence
of risk and regulation 
– increased value 
added from our 
industry	practitioners
Convergence
of risk and regulation 
– increased value 
added from our 
industry	practitioners
Further 
revenue visibility
backlog and recurring 
revenues continue at 
record levels
Further 
revenue visibility
backlog and recurring 
revenues continue at 
record levels
Opportunities for growth www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
05
Our	strategy
K ey	performance	indicators
Build Maintain Grow
 Enhance optimisation 
functionality	in	COLLINE
®
 to 
meet developing demands
 Improve product design, 
integration and performance
	 Develop,	with	key 	customers,	
next-generation	regulatory	
reporting solution
	 Execute	efficient	
global operation
	 Extend	partner	ba se
	 Client 	 base, 	 especially 	 for	
newer 	 products 	 (eg 	 REFORM
®
 
for transaction reporting 
and messaging) 
 Targeted global presence
 Addressable market using 
current	technology	platforms
	 Company 	 organically 	 and, 	 if	
appropriate, through acquisition
	 Market-leading	position	
in	regulatory	compliance
	 Industry -leading 	 position 	 in 	 OT C	
derivative risk management
 Strong relationships with 
our clients
	 Understanding	of	regulatory	
waves	and	benefits	therefrom
Working capital management (£m) F unctional	costs	(fully	expensed)	as	a	proportion	
of functional revenue (£m)
2.5
10.1
0.2
3.3
2.3
12.6
0.6
4.3
2012
2012
2012
2012
2013
2013
2013
2013
Trade receivables
Administrative 
expenses
Trade payables
Investment in 
development
Professional 
services
Support and 
maintenance
Sales and 
marketing*
Research and 
development*
Administration*
* versus total revenue
F urther	information	on	
how the Directors monitor 
key	performance	indicators	
in the Directors’ report 
starting on page 19
4.6 1.3 28%
2.8 3.9 72%
16.8 3.1 18%
16.8 4.9 29%
16.8 3.7 22%
Cost Revenue
Our	strategy	has	allowed	us	to	create	award-winning	global	solutions.
Turnover by trading division (£m)
2013
2012
7.9 8.9
Risk management and 
trading software
Regulatory compliance 
software
2013
2012
6.5
4.8
4.2
1.3
Turnover by geography (£m)
United Kingdom
Rest of Europe, Middle 
East and Africa
The Americas
Asia Pacific Annual report and accounts 2013 Lombard	Risk	Management	plc
06
I am pleased to report a progressive year at Lombard 
Risk. The financial performance has met our growth 
expectations. Sales of COREP , our solution for European 
Banking Authority Common Reporting, and of our 
transactional reporting platform, REFORM
®
, have been 
at the forefront of this growth. As well as recording 
top line growth in excess of 30% (18% organic), 
we finished the year with a record revenue backlog 
and appreciable visibility of future revenues as 
a result of an improvement in the longevity 
of contractual commitments.
Last	year	I	highlighted	the	Group’s	strategy	of	building	
a	high-quality	business	based	upon	intellectual	property .	
This	strategy	of	continual	innovation	and	product	
development 	 within 	 both 	 new 	 regulatory 	 reporting 	 solutions	
and repeatable platforms ensures that we remain at the 
forefront	of	providing	regulatory	reporting	and	risk	
management in our chosen global markets. 
Our progress has been achieved against the continuing 
backdrop	of	a	global	economic	environment	dominated	by	
key	economies	unable	to	drag	themselves	out	of	recession,	
worldwide	inflationary	pressures	and	the	instability	of	the	
Euro.	On	a	micro	level,	financial	institutions	are	seeking	
to	retain	cash	and	either	cancelling	or	postponing	many	
technology	initiatives.	In	addition,	regulatory	reporting	
deadlines	are	regularly	being	delayed	causing	delivery	
difficulties	for	both	our	customers	and	the	Group.	These	
challenges also present opportunities, with the increasing 
waves	of	regulation	in	financial	markets	showing	no	signs	
of abating. Our target customer base continues to have 
many	mandatory	technology	requirements,	for	which	
budget	remains	available.	Lombard	Risk’s	technology	
predominantly	satisfies	mandatory	needs.
The 	 trading 	 highlight 	 was 	 the 	 sale 	 of 	 our 	 REFORM
®
 platform 
to	a	major	global	bank	to	satisfy	its	DF A	(Dodd-F rank	Act)	
and	EMIR	(European	Market	Infrastructure	Regulation)	
transactional reporting requirements.
Operationally ,	I	am	delighted	that	the	Group	achieved	
CMMI-D	Level	3	accreditation	from	the	CMMI	Institute.	
This	is	in	recognition	of	its	high-quality	software	design,	
development and implementation processes. This, together 
with 	 the 	 ISO 	 9001 	 certification, 	 is 	 a 	 prestigious 	 achievement 	
for	our	technology	division.	W e	have	defined	CMMI-D	
Level	3	processes	which	increase	delivery	efficiency	and	
team effectiveness and are consistent and repeatable across 
all projects and products. This further enhances our reputation 
with 	 clients 	 and 	 partners 	 and 	 confirms 	 our 	 ability , 	 if 	 required, 	
to scale up development work on multiple projects.
The Board continues to review acquisition opportunities 
where	strong	synergies	exist	with	the	Group	and	where	
our	development	expertise	can	enhance	functionality	
and	profitability	to	the	products	acquired.
As	the	Group’s	results	have	indicated,	turnover	growth	
has proved to be more than resilient to economic 
challenges and we remain optimistic for the future.
Philip Crawford
Chairman
13 May 2013
Chairman’s statement
Philip Crawford
In summary
 Revenue £16.8m (2012: £12.8m)
	 Improvement	in	future	revenue	visibility
	 Global	regulatory	reporting	requirements	continue	to	expand
	 Major	contract	to	provide	transactional	reporting	using	REFORM
®
	 CMMI-D	Level	3	accreditation	achie ved
	 The	Board	remain s	optimistic	for	the	future	outlook	of	the	Group
CMII-D 3 Accreditation
In	January	2013	Lombard	
achieved accreditation from the 
CMMI	Institute	in	recognition	of	
its	high-quality	software	design,	
development and 
implementation processes.
CMII-D 3 Accreditation
In	January	2013	Lombard	
achieved accreditation from the 
CMMI	Institute	in	recognition	of	
its	high-quality	software	design,	
development and 
implementation processes. www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
07
“ The Group continues to benefit 
from a compelling combination 
of a growing market, a healthy 
mix of long-standing and new 
customers, record recurring 
and committed revenues, good 
forward visibility and a leading 
competitive position.”
Summary
The	year	was	a	record	both	for	revenue	and	profits,	with	
over 30% headline growth and like for like revenue growth 
of 18% after taking into account the impact of acquisitions. 
EBITDA	increased	from	£3.0m	last	year	to	£5.3m	in	the	
current	 year ,	 a	 77%	 rise.	 While	 this	 rise	 was	 expected	 it	 was	
nevertheless pleasing that, at the same time, we were able 
to 	 build 	 a 	 record 	 revenue 	 backlog 	 going 	 into 	 the 	 new 	 financial 	
year . 	 All 	 this 	 was 	 achieved 	 in 	 spite 	 of 	 the 	 European 	 regulatory	
deadlines 	 slipping 	 by 	 nine 	 months 	 or 	 more, 	 which 	 inevitably	
affected	our	revenue	for	the	year .	The	second	half	of	the	
year	was	especially	strong.	W e	have	now	grown	revenues	
by	a	compound	20%	per	annum	over	the	last	four	years.
The	Group	continues	to	benefit	from	a	compelling	
combination	of	a	growing	market,	a	healthy	mix	of	
long-standing and new customers, record recurring and 
committed 	 revenues, 	 good 	 forward 	 visibility 	 and 	 a 	 leading	
competitive	position.	As	a	result	we	remain	confident	
of	further	growth	in	the	new	financial	year	and	beyond.	
At	a	time	when	many	companies	in	the	software	sector	
are struggling, we believe that in the near future the 
market	will	recognise	that	we	not	only	have	a	strong	
positioning in the growing areas of regulation and risk 
but	that	we	are	executing	well	in	those	markets.	
W e	invested	appreciably	during	the	year ,	both	in	product	
development and in strengthening the sales team, including 
the	appointment	of	a	Head	of	Global	Alliances.	There	are	
significant	opportunities	in	our	markets,	particularly	at	
present, which demand further investment in product 
development and which the Board believes will contribute 
appreciably	to	future	revenues.	Indirect	sales	will	become	
an	increasingly	important	part	of	our	revenue	model	and	
again this should contribute to revenue growth.
W e 	 enter 	 the 	 new 	 financial 	 year 	 with 	 our 	 recurrent 	 revenues 	
at an all-time high, our highest ever level of contractual 
backlog, with a boost from the remaining COREP deals 
that	we	anticipate	would	have	closed	before	March	2013	
had	the	regulations	not	been	delayed.	
Financial
Revenue	for	the	year	increased	by	31%	to	£16.8m	
(2012:	£12.8m).	Profit	before	taxation	was	£3.9m	
(2012: 	 £2.5m) 	 and 	 profit 	 after 	 taxation 	 was 	 £3.7m 	
(2012: £2.5m). EBITDA was £5.3m (2012: £3.0m). 
W e 	 built 	 up 	 cash 	 during 	 the 	 year 	 to 	 £1.9m 	 at 	 the 	 same	
time 	 as 	 repaying 	 debt 	 and 	 ended 	 the 	 year 	 with 	 a 	 positive	
net cash position of £0.2m versus net debt in the previous 
year	of	£2.4m,	an	improvement	of	£2.6m.	
T o	put	these	numbers	into	full	context:
i)	 	 W e	only	owned	the	REG-Reporter
®
 business for three 
months	of	the	previous	financial	year .	The	pro	forma	
revenue	number	for	FY	2012	would	have	been	£14.2m	
rather	than	£12.8m	had	we	owned	it	for	the	full	year .	
That gives a like for like revenue growth number for 
the	Group	of	18%.
ii)	 	 W e	raised	equity	during	the	year	of	£1.5m	after	costs,	
so	that	we	were	cash	positive	by	£0.8m	from	our	
operations	post-investing	activities,	despite	heavy	
investment in our products and in our sales team.
Chief Executive Officer’s statement
John	W isbey
In summary
	 18%	organic	growth;	31%	total	rev enue	growth
	 EBITDA	increased	 to	£5.3m	from	p rior	year	of	£3.0m	
	 Many	COREP	and	FINREP	opportunities	exist
 ComplianceASSESSOR launched
	 Multiple	of	REFORM
®
	already	evide nt
 Well placed for future growth Annual report and accounts 2013 Lombard	Risk	Management	plc
08
Regulatory and Compliance software products
Lombard	Risk	is	the	market	leader	for	UK	bank	regulatory	
reporting software in the UK through its REPORTER product. 
Lombard 	 Risk 	 is 	 also 	 the 	 largest 	 supplier 	 by 	 far 	 of 	 regulatory	
reporting software to foreign banks in the US.
Regulatory 	 change 	 is 	 always 	 one 	 of 	 the 	 main 	 revenue 	 drivers	
for	a	regulatory	business.	2014	is	now	the	key	deadline	for	
common 	 reporting 	 (“COREP”) 	 and 	 common 	 financial 	 reporting 	
(“FINREP ”) 	 at 	 European 	 Union 	 level 	 to 	 the 	 European 	 Banking	
Authority	(“EBA ”).	Originally	COREP	had	been	expected	to	
come	into	force	by	the	end	of	March	2013.	W e	have	been	
successful in the UK in selling REPORTER COREP software 
to 	 33 	 clients 	 (with 	 many 	 more 	 to 	 go). 	 It 	 is 	 very 	 encouraging	
that so far eleven of these clients have been new names 
for us. Interesting statistics are that of these eleven, seven 
were won from competitors, two were start-ups and two 
had	previously	used	manual	systems.	
Revenues 	 for 	 Regulatory 	 Compliance 	 in 	 EMEA 	 were 	 inevitably	
affected	by	the	nine	month	delay	in	COREP	as	there	were	
further 	 delays 	 at 	 European 	 level 	 in 	 finalising 	 the 	 regulations. 	
Banks also saw no need to accelerate implementation projects 
when	it	was	increasingly	apparent	that	quite	a	lot	of	the	
work might need to be redone when the regulations were 
finalised.	Obviously	at	the	same	time	as	adversely	affecting	
revenues 	 for 	 the 	 year 	 ending 	 March 	 2013, 	 regulatory 	 delays	
have been helpful for our opening contractual backlog going 
into	the	year	ending	March	2014	and	for	our	sales	pipeline	
for 	 the 	 year 	 ending 	 March 	 2014. 	 In 	 addition 	 it 	 was 	 not 	 clear	
last	year	whether	FINREP	would	apply	in	the	UK.	It	now	
seems	most	likely	that	it	will	and	this	should	bring	an	
additional	stream	of	revenue	in	the	current	financial	year .
Financial	regulation	continues	much	as	before	at	UK	level	
despite European EBA initiatives and the recent split of the 
FSA	into	the	Prudential	Regulation	Authority	(“PRA ”)	and	
the	Financial	Conduct	Authority	(“FCA ”)	is	likely	to	give	a	
stable	UK	regulatory	environment	for	the	next	few	years.	
It	will	not	affect	the	appreciable	regulatory	change	to	be	
introduced	in	the	next	few	years,	and	we	expect	this	to	
keep	us	very	busy .	
Our 	 regulatory 	 reporting 	 acquisition 	 in 	 America 	 has 	 been 	 well	
integrated. All client contracts were novated and we lost 
no clients other than a foreign bank branch which closed 
down	in	the	US.	W e	now	have	over	75	regulatory	clients	
in	the	US,	many	of	them	Tier	1	foreign	banks.	In	Asia	work	
continued 	 satisfactorily 	 on 	 Chinese 	 regulatory 	 reporting 	 and	
in	finishing	a	number	of	regulatory	projects	in	Hong	K ong	
and	Singapore.	W e	expect	Asia	to	perform	strongly	in	the	
new	financial	year	thanks	to	investment	in	the	past	year .
W e	made	strong	headway	with	our	REFORM
®
 product 
in the area around transaction reporting and reporting 
to	trade	repositories	like	the	DT CC	to	comply	with	US	CF T C	
and	SEC	requirements	derived	from	the	Dodd-F rank	Act.	
A major development in global markets is the development 
of	trade	repositories	such	as	the	DT CC,	CME	and	REGIS.	
The	Dodd-F rank	Act	in	the	US,	and	the	EMIR	and	REMIT	
regulations in the EU, as well as similar developments in 
Hong	K ong,	Japan,	Singapore	and	other	countries,	compel	
Swap Dealers and other market participants to report derivative 
transactions to trade repositories in minutes in the US and 
at 	 least 	 daily 	 in 	 other 	 jurisdictions. 	 The 	 technology 	 in 	 REFORM
®
 
is	highly	reusable	for	message	transformation	generally	
and we have also used it for message transformation in 
the collateral space as described below.
We also launched our ComplianceASSESSOR™ product. 
This product puts good process around compliance with 
regulations and creates a clear view and audit trail of how 
an 	 institution 	 is 	 complying 	 with 	 individual 	 parts 	 of 	 its 	 regulatory	
environment.	At	a	time	when	there	is	increasing	focus	by	
UK regulators on conduct, and when some banks have 
faced	very	heavy	fines	for	not	complying	with	regulations	
(eg 	 making 	 payments 	 in 	 US$ 	 to 	 Iranian 	 entities), 	 this 	 product	
is in the right place at the right time. There should be good 
upside	from	this	product	in	the	next	year .
Other	EMEA	opportunities	for	our	traditional	regulatory	
business	over	the	next	few	years	after	COREP ,	FINREP	and	
EMIR 	 will 	 come 	 from 	 Basel 	 3 	 and 	 MIFID 	 2, 	 with 	 opportunities	
to	expand	our	client	base	for	Solvency	2.	The	need	to	
report transactions to trade repositories should generate 
additional business for us.
Chief Executive Officer’s statement continued
Total revenue
 £16.8m +31%
(2012: £12.8m)
Average revenue growth since 2010
24% p.a. www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
09
As	well	as	our	new	REFORM
®
 and ComplianceASSESSOR™ 
products, we have made, and continue to make, some 
important	technology	and	product	enhancements	to	our	
regulatory	product	set.	This	will	be	a	focus	for	investment	
in	the	coming	year ,	designed	to	make	our	regulatory	
product set more attractive to global Tier 1 banks at 
regional	or	head	office	level	as	well	as	enhancing	the	
experience	and	providing	additional	modules	to	our	wider	
client	set.	Our	REPORTER	Analysis	Centre	was	launched	
during	the	year	and	has	already	generated	revenue.
Risk Management and Trading products 
W e 	 have 	 made 	 strong 	 progress 	 with 	 COLLINE
®
, our collateral, 
clearing	and	repo	platform.	W e	now	have	just	under	fifty	
direct	clients	for	COLLINE
®
	and	many	more	indirect	clients.	
During	the	year	we	signed	up	another	top	German	bank,	
adding	to	our	existing	German	bank	wins	and	Société	
Générale	in	the	previous	year .	Several	clients	were	gained	
for	our	COLLINE
®
 CCP clearing and repo modules. 
Almost	all	our	clients	are	affected	by	either	Dodd-F rank	or	
EMIR	regulatory	requirements.	This	has	been	helpful	to	us	
by	forcing	banks	and	other	large	market	participants	to	
review	systems	where	their	legacy	system	is	not	built	with	
these	regulatory	changes	in	scope.	Our	COLLINE
®
 clearing 
module has been built with this in mind and we have made 
many 	 other 	 changes 	 to 	 COLLINE
®
 to ensure that it is compliant 
with the new regulations.
Much 	 work 	 has 	 been 	 done 	 on 	 opening 	 up 	 COLLINE
®
 through 
APIs and allowing even greater automation through 
connectivity 	 to 	 other 	 infrastructure. 	 W e 	 used 	 a 	 combination	
of	our	COLLINE
®
	API	and	our	REFORM
®
 platform to create 
two	way	real-time	links	with	a	collateral	market	messaging	
system	called	Marginsphere	from	AcadiaSoft,	Inc.	This	is	
now	almost	in	full	production	at	a	Tier	1	German	bank.	
Greater	automation	and	straight	through	processing	is	
important	to	most	large	bank	clients;	we	anticipate	more	
initiatives in this regard.
OBERON
®
, our most established product, which has the 
ability	to	value	and	risk	manage	many	different	types	of	
financial	instrument,	is	profitable	and	continues	to	move	
forward with functional and performance enhancements. 
Technology
W e	continue	to	see	our	technology	as	an	increasingly	
positive	part	of	our	commercial	story	and	a	key	driver	for	
growth.	Our	IP	is	a	major	corporate	asset.	During	the	year	
we 	 have 	 invested 	 heavily 	 in 	 developing 	 software, 	 particularly	
to handle our clearing and repo/sec lending initiatives for 
COLLINE
®
	but	also	to	develop	our	new	REFORM
®
 product 
mentioned above and to prepare for our REPORTER 
COREP module. 
Our 	 model 	 is 	 to 	 do 	 much 	 of 	 the 	 business 	 analysis 	 in 	 London,	
New	Y ork	and	other	financial	centres	but	to	handle	the	
majority	of	development	and	testing	in	Shanghai,	China.	
Efficiency	and	good	process	is	very	important	to	us.	During	
the	year	our	Development	and	T esting	Centre	was	awarded	
the 	 CMMI-D 	 Level 	 3 	 award. 	 This 	 is 	 a 	 very 	 significant 	 external 	
validation of a well-managed operation with good processes.
Much	progress	has	continued	to	be	made	on	moving	our	
technology’s 	 look 	 and 	 feel 	 to 	 a 	 new 	 platform 	 and 	 in 	 building	
components that can work across our various products. 
Client reaction to the look and feel of the new platform 
has	been	extremely	positive.	F unctionally ,	our	products	
continued to make great progress.
COLLINE
®
’s	scalability ,	resilience	and	performance	is	proven	
at our largest client using active-active clustering in multiple 
data centres, user locations in three continents and over 
300	users.	This	means	we	now	have	every	confidence	that	
our solution is scalable from the smallest collateral user to 
the 	 largest 	 global 	 bank. 	 Similar 	 technology 	 is 	 being 	 deployed	
for	our	other	products	where	performance	is	a	key	issue.
W e	have	invested	in	greatly	upgrading	the	software	tools	
which we use ourselves to monitor software project costs, 
project	progress	and	individual	productivity	and	quality .
Personnel and premises
During the period we continued to make new hires appropriate 
to 	 the 	 expected 	 growth 	 of 	 the 	 business. 	 Headcount 	 increased	
to	273	at	31	March	2013	from	252	at	the	prior	year	end.	
About 	 150 	 of 	 our 	 Group 	 headcount 	 are 	 in 	 our 	 Development	
and Testing Centre in Shanghai.
Investment in product development
£4.3m +29%
(2012: £3.3m)
Net	assets
 £10.5m +95%
(2012: £5.4m) Annual report and accounts 2013 Lombard	Risk	Management	plc
10
“ COLLINE
®
’s scalability, resilience 
and performance is proven at our 
largest client using active-active 
clustering in multiple data centres, 
user locations in three continents 
and over 300 users.”
Prospects
W e 	 enter 	 the 	 new 	 financial 	 year 	 with 	 a 	 good 	 level 	 of 	 optimism. 	
Firstly , 	 our 	 recurrent 	 revenue 	 is 	 well 	 up 	 and 	 we 	 have 	 a 	 record	
contractual	backlog	to	start	the	year .	Secondly ,	our	product	
strategy	means	that	we	are	well	placed	to	benefit	from	the	
considerable	opportunity	in	the	regulatory	and	risk	areas	in	
which 	 we 	 operate. 	 Thirdly , 	 we 	 have 	 made 	 great 	 headway 	 with	
our partnership module and see the likelihood of more revenue 
through	third	parties	than	in	the	past.	Finally ,	COREP	is	a	
greater	opportunity	for	this	year	than	we	expected	as	a	
result	of	the	regulatory	delays.
W e	clearly	continue	to	operate	in	an	environment	where	
there	is	little	discretionary	spending	and	where	many	major	
banks	and	the	countries	in	which	they	operate	are	far	from	
financial 	 health. 	 There 	 also 	 remains 	 the 	 risk 	 of 	 high 	 government 	
debt	levels	leading	to	inflationary	pressures	for	many	G20	
countries including the main ones in which we operate. 
While	no	company	can	be	immune	to	the	overall	
macroeconomic situation, we do believe that Lombard 
Risk	is	very	well	placed	in	its	target	markets.
W e 	 anticipate 	 a 	 year 	 of 	 further 	 encouraging 	 growth. 	 I 	 would	
like 	 to 	 thank 	 all 	 my 	 colleagues 	 as 	 well 	 as 	 our 	 advisers 	 for 	 their	
hard work and commitment and our customers and investors 
for their continued support.
John Wisbey
Chief Executive
13 May 2013
Chief Executive Officer’s statement continued www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
11
This Finance review expands the information on financial performance contained within the Chairman’s statement 
and the Chief Executive Officer’s statement and seeks to give a clear picture of year -on-year progress.
Users	of	the	annual	report	should	be	able	to	make	a	candid	assessment	of	the	financial	performance	of	the	Group.	
The	FY	2012	acquisition	and	capitalisation	of	development	costs	for	the	last	two	years	inadvertently	reduce	the	
transparency	of	the	financial	performance	of	the	Group.	The	Group’s	operating	budget	and	monthly	management	
information	measures	financial	performance	assuming	no	capitalisation.	The	figures	below	help	enable	users	of	the	
annual	report	to	enjoy	the	same	comparable	information:
Y ear	ended	31	March
2013
£m
2012
£m
2011
£m
Revenue	including	pro	forma	acquired	business	for	all	years 16.8 14.2 13.8
EBITDA including acquired business with no capitalisation 1.0 (0.3) 0.7
EBITDA including acquired business and capitalisation* 5.3 3.0 2.6
Profit	before	tax	including	acquired	business	with	no	capitalisation 0.7 (0.5) 0.5
Profit	before	tax	including	acquired	business	and	capitalisation* 3.9 2.5 2.4
T otal	technology	expenditure** 6.1 4.5 2.7
Cash generated from operations with no capitalisation 1.0 (1.5) 1.2
	 *	Capitalisation	assumed	at	73%	of	research	and	development	costs	in	FY	2011. 
** Includes research, development, testing, support and product maintenance.
The 	 Group 	 has 	 experienced 	 respectable 	 revenue 	 growth, 	 with 	 only 	 professional 	 service 	 revenues 	 falling 	 below 	 expectations,	
which	resulted	from	clients’	implementation	delays.	
Must-have	technology	solutions	create	a	much-desired	compelling	sales	event	but	also	reduce	flexibility	on	the	timing	
of	investment	in	development,	as	missing	regulatory	deadlines	is	not	an	option	for	our	customers.	W e	therefore	need	
to	remain	agile	and	meet	our	customers’	delivery	expectations.	This	has,	in	turn,	resulted	in	technology	costs	increasing	
year -on-year	by	35%	(2012:	66%).
Financial review
Paul Tuson
Key messages
 Organic revenue growth of 18% (2012: 4%)
 Organic licence revenue growth of 31% (2012: 42%)
	 Growth	is	still	challenged	by	difficult	macroeconomic	market	conditions
	 Strong	performance	in	Europe	part ially	offset	by	underperformance	in	Americas	and	Asia	P acific
	 At	31	March	2013,	contracted	bac klog	for	licence	and	professional	services	totalled	£4.4m	(2012:	£2.6m)
 Average committed term of EBA COREP contracts (annual licence and support and maintenance) signed 
to	31	March	2013	is	4.7	years
	 Capitalisation	of	development	cost s	added	£3.2m	(2012:	£3.0m)	to	profi t	for	the	year
	 US	regulatory	business	acquired	in	FY	2012	met	operating	expectations
“ Must-have technology solutions 
create a much-desired compelling 
sales event but also reduce flexibility 
on the timing of investment in 
development, as missing regulatory 
deadlines is not an option for our 
customers. We therefore need 
to remain agile and meet our 
customers’ delivery expectations.” Annual report and accounts 2013 Lombard	Risk	Management	plc
12
Over 	 the 	 past 	 two 	 years, 	 the 	 Group 	 has 	 focussed 	 on 	 increasing	
contract 	 longevity . 	 The 	 commitment 	 shown 	 by 	 our 	 customers	
implies 	 a 	 high 	 level 	 of 	 satisfaction 	 with 	 the 	 Group’s 	 products	
and levels of support and maintenance. In addition, it provides 
solid	foresight	and	predictability	to	a	strong	level	of	
future revenues.
Profit and loss
Revenues 	 increased 	 by 	 31% 	 to 	 a 	 record 	 £16.8m 	 for 	 the 	 year ,	
compared	with	£12.8m	in	the	prior	year .	Licence	revenues	
increased	in	the	year	by	37%	to	£8.2m	(2012:	£6.0m),	
representing 49% of revenues (2012: 47%). Recurring 
annual	revenues	totalled	£7.2m,	approximately	43%	of	
revenue (2012: 43%) and now have a current annual run 
rate	of	in	excess	of	£8.0m.	
Operating	profit	before	share-based	charges,	depreciation	
and amortisation and acquisition costs increased to £5.3m 
(2012:	£3.1m).	Profit	before	tax	increased	to	£3.9m	
(2012: £2.5m).
The 	 effective 	 rate 	 of 	 tax 	 for 	 the 	 year 	 was 	 4.7% 	 (2012: 	 0.0%).	
The	recognised	deferred	tax	asset	decreased	by	£0.2m	to	
£0.5m	(2012:	£0.7m)	and	the	unrealised	deferred	tax	asset	
is £0.7m (2012: £1.3m).
Cash flow
Cash generated in operations was £5.8m (2012: £1.8m). 
As	for	many	growth	technology	companies,	the	pressure	
on balancing working capital requirements with investing 
in	longer -term	growth	continues.	The	Group	produces	
cash forecasts close to real time which are monitored 
closely .	The	decision	to	raise	£1.5m	in	June	2012	mitigated	
any	risk	of	delays	by	regulatory	authorities	in	introducing	
new	reporting	requirements	causing	an	extension	to	the	
pay	back	on	new	product	developments.
Investment	in	research	and	development	expenditure	that	
was capitalised was £4.3m (2012: £3.3m).
The	Group	raised	£1.5m	(net)	(2012:	£0.1m)	with	£0.1m	
(2012:	£0.1m)	resulting	from	the	exercise	of	employee	
stock options. 
The	Group	had	cash	outflows	of	£1.2m	to	partially	
satisfy 	 the 	 debt 	 incurred 	 to 	 finance 	 the 	 FY12 	 acquisition. 	
In 	 December 	 2012, 	 the 	 Group 	 settled 	 the 	 loan 	 note 	 for	
$550,000	due	for	repayment	by	31	December	2013	
at 	 a 	 discount 	 of 	 $83,000. 	 This 	 was 	 partially 	 financed 	 by 	
a short-term bank loan of €400,000. The loan was taken 
in	Euros	to	mitigate	foreign	exchange	exposure	on	
contractual	payments	due	in	Euros.
Overall	there	was	a	net	cash	inflow	of	£1.7m	
(2012:	outflow	£1.7m).
Balance sheet
Non-current 	 assets 	 at 	 31 	 March 	 2013 	 increased 	 to 	 £13.4m	
(2012:	£10.4m),	predominantly	caused	by	the	increase	
in capitalised development costs.
Net 	 cash 	 at 	 31 	 March 	 2013 	 is 	 £0.2m 	 (2012: 	 net 	 debt 	 £2.4m).
T rade	receivables	were	13%	of	revenues	at	31	March	2013,	
compared	to	20%	and	5%	for	2012	and	2011	respectively .	
The	decrease	this	year	partially	offset	the	working	capital	
squeeze	 caused	 by	 the	 increase	 at	 the	 end	 of	 the	 prior	 year .
Shareholder information
The	Group’s	website	at	www .lombardrisk.com	contains	a	
wide range of information about our activities and visitors 
can download copies of the report and accounts as well 
as newsletters and matters of interest.
Paul Tuson
Chief Finance Officer
13 May 2013
Financial review continued
F or	further	details	on	our	
financial	position,	turn to 
the financial statements 
starting on page 25 www.lombardrisk.com Annual report and accounts 2013
Overview 01–13
13
Risk area Mitigation
1. Market risk: Market	risk	includes	factors	that	
impact	the	value	of	the	Group’s	assets	and	liabilities	
and 	 the 	 expected 	 value 	 in 	 base 	 currency 	 of 	 the	
Group’s	revenues	and	costs.
i. Currency risk: The	Group	is	exposed	to	
translational	and	transactional	foreign	exchange	
risk as it operates in various currencies, including 
US 	 Dollars, 	 the 	 Euro, 	 Chinese 	 Y uan, 	 Hong 	 K ong 	 Dollars	
and Singapore Dollars which affect the management 
and levels of working capital.
Although,	through	its	own	software,	the	Group	has	access	to	sophisticated	
models 	 for 	 the 	 management 	 of 	 foreign 	 exchange 	 risk, 	 there 	 has 	 historically 	 been	
no 	 use 	 of 	 foreign 	 exchange 	 derivatives 	 to 	 manage 	 this 	 position 	 on 	 the 	 basis 	 that	
the	overall	effect	on	the	Group’s	income	statement	has	not	been	large	enough	
to	warrant	the	management,	costs	and	margin	requirements	of	this	activity .	
The	Group	does	use	natural	hedges	where	the	appropriate	opportunity	arises.	
In 	 addition, 	 the 	 Group 	 prepares 	 working 	 capital 	 forecasts 	 that 	 incorporate 	 sensitivity	
analysis 	 on 	 exchange 	 rate 	 fluctuations. 	 The 	 Company’s 	 main 	 on-going 	 transactional 	
exposure	is	to	be	long	of	Euro	and	US	Dollars	and	short	of	Chinese	Y uan.
ii. Inflation risk: The	Group	has	exposure	to	the	
inflationary	effect	of	operating	in	countries	in	which	
it	 operates,	 offset	 by	 its	 ability	 to	 raise	 prices	 in	 those	
countries	in	which	it	sells.	The	Group’s	cost	base	is	
mainly	exposed	to	the	inflation	rates	and	changes	
in	payroll	taxes	in	the	UK,	the	US	and	China.
The 	 inflation 	 rate 	 for 	 salaries 	 in 	 specialised 	 parts 	 of 	 the 	 financial 	 sector 	 in 	 a 	 financial 	
centre	such	as	London,	New	Y ork	or	Shanghai	is	often	different	from	the	relevant	
country’s 	 overall 	 rate 	 of 	 wage 	 inflation. 	 Salary 	 inflation 	 in 	 these 	 markets 	 and 	 internally 	
is	monitored.	No	specific	hedging	of	inflation	risk	has	been	carried	out.
iii. Interest rate risk: Interest	 rate	 risk	 arises	 primarily	
on	the	investment	of	the	Group’s	cash	balances	
or on its borrowings and the present value of the 
Group’s 	 receivables. 	 In 	 par ticu lar , 	 in tere s t 	 on 	 the	
Grou p ’ s 	 borrowi ng s 	 i s 	 a f fec t ed 	 by 	 LIBOR .
The	Group	finances	its	operations	through	retained	cash	reserves	and	overdraft	
facilities. 	 The 	 policy 	 of 	 the 	 Group 	 is 	 to 	 monitor 	 exposure 	 to 	 interest 	 rate 	 risk 	 and	
take	into	account	potential	movements	in	interest	rates	as	well	as	liquidity	
considerations	when	selecting	methods	of	financing.
2. Credit risk: Credit	risk	is	the	risk	that	a	third	party	
might	fail	to	fulfil	its	performance	obligations	under	
the	terms	of	a	financial	instrument.	F or	cash	and	
cash equivalents and trade and other receivables, 
credit	risk	represents	the	carrying	amount	on	the	
balance	sheet,	net	of	any	overdraft	positions.
Most	of	the	Group’s	business	is	with	banks,	asset	management	firms	and	other	
high	quality	companies	and	the	Group’s	bad	debt	experience	over	fifteen	years	
has 	 been 	 negligible. 	 The 	 Group 	 consequently 	 has 	 not 	 considered 	 taking 	 out 	 credit	
insurance	and	is	not	likely	to	do	so	in	the	foreseeable	future.	Deposits	are	placed	
with	high-quality	banks.	Although	through	its	own	Firmament
®
 software the 
Group	has	access	to	sophisticated	models	for	the	management	of	credit	spreads	
and credit derivatives, there has been no use of credit derivatives to mitigate 
counterparty	risk	and	no	such	use	is	contemplated.
3. Operational risk: This includes control over bank 
accounts, processes for delivering and supporting 
software	to	a	required	level	of	quality	and	on	a	
timely	basis	and	retention	and	recruitment	of	key	
personnel. Reputational risk might arise from poor 
execution,	non-delivery	or	late	delivery	of	a	project	
or	breach	of	client	confidentiality .	F urther	risks	
may	arise	where	late	delivery	of	software	or	related	
services	causes	a	client	to	miss	regulatory	deadlines.
A detailed operational risk review is outside the scope of this report but the Board 
attaches	importance	to	maintaining	appropriate	internal	controls	to	identify	and	
limit these risks.
This includes integrated project management across all functions of the business. 
The	Group’s	Audit	Committee	regularly	reviews	controls	over	certain	aspects	
of	the	operations	of	the	Group.
4. Liquidity risk: Liquidity	risk	is	the	risk	of	loss	from	
not	having	access	to	sufficient	funds	to	meet	both	
expected	and	unexpected	cash	demands.
T h e	G r o u p	s e e k s	t o	m a n a g e	fi n a n c i a l	r i s k	b y	e n s u r i n g	t h a t	s u f fi c i e n t	l i q u i d i t y	i s	
a v a i l a b l e	t o	m e e t	f o r e s e e a b l e	n e e d s	a n d	b y	i n v e s t i n g	c a s h	a s s e t s	s a f e l y	a s	w e l l	
as 	 p r ofi t ab l y . 	 T h e 	 G r o up ’ s 	 w or k in g 	 c ap i t al 	 r e p or t , 	 p r o duce d 	 e a ch 	 m ont h, 	 sh ow s 	
fore c as t 	 mon thly 	 movemen t s 	 in 	 work ing 	 capital 	 and 	 cash 	 for 	 the 	 following 	 year .	
When 	 req u i red 	 the 	 Grou p 	 h a s 	 a 	 shor t - t erm 	 o verd ra f t 	 faci l it y 	 wh ich 	 a t 	 the 	 yea r 	 end	
has not been used.
The Group’s multinational operations expose it to financial 
risks that include market risk, credit risk, operational risk 
and liquidity risk. 
The Directors review and agree policies for managing each 
of these and they are summarised below. These policies have 
remained unchanged from previous years.
Risk analysis Annual report and accounts 2013 Lombard	Risk	Management	plc
14
The Group is run by its Board of Directors, 
which currently has five members, including 
two Non-executive Directors, and meets regularly. 
The Non-executive Directors make a valuable 
contribution by bringing a breadth of business 
and relevant professional experience to the Board.
The Board has overall responsibility for the 
Group and there is a formal schedule of matters 
specifically reserved for decision by the Board. 
It is responsible for the overall Group strategy, 
acquisition and divestment policy, corporate 
policies, approval of major capital expenditure 
and consideration of significant capital matters.
Board of Directors
1
3
2
4
5 www.lombardrisk.com Annual report and accounts 2013
15
Governance 14–23
1. Philip Crawford
 Non-executive Chairman
Philip Crawford joined the Board of Lombard Risk 
in 	 2010. 	 He 	 has 	 been 	 working 	 in 	 the 	 IT 	 industry 	 since	
1983. Philip has held a number of senior positions in 
software, hardware and services companies including 
senior vice president of Oracle Corporation with 
membership 	 of 	 the 	 executive 	 board 	 and 	 Larry 	 Ellison’s	
Strategy	Council,	president	of	EDS	International	with	
responsibility	for	all	markets	outside	the	US,	chief	
executive	of	Bull	UK	and	executive	vice	president	
and	head	of	EMEA	for	i2	T echnologies.	
Since	retiring	from	full	time	employment	in	2002,	
Philip	has	concentrated	on	his	Non-executive	Director	
portfolio	and	acts	as	a	“business	angel”.	He	is	currently	
the chairman of Avanti Capital Plc and Crimsonwing Plc 
as well as being chairman and investor in a small number 
of	private	companies,	mainly	in	the	technology	space.
2. John Wisbey
 Chief Executive Officer
John	W isbey	is	the	Chief	Executive	Officer	of	Lombard	
Risk, which he has led since its launch in 1989 with the 
introduction	of	OBERON
®
,	one	of	the	industry’s	original	
software	systems	for	financial	instrument	valuation	and	
risk 	 management. 	 John 	 has 	 guided 	 the 	 Company’s 	 organic	
growth through the creation and development of several 
successful	products,	initially	OBERON
®
,	followed	by	
V aluSpread,	a	credit	derivative	data	service	(sold	to	Fitch	
in 	 2005), 	 COLLINE
®
 for collateral management and, most 
recently , 	 LISA
®
	 for 	 liquidity 	 risk 	 management 	 and 	 REFORM
®
 
for	event	reporting.	In	addition,	John	has	been	the	
principal	architect	of	the	Company’s	inorganic	growth,	
which	includes	the	acquisitions	of	Open	Image	Systems	
in	1994	(later	floated	on	AIM	as	IDO X	plc	in	2000)	and	
STB	Systems	(now	the	core	of	Lombard	Risk’s	regulatory	
compliance	business)	in	2005	and	the	REG-Reporter
®
 
business 	 of 	 SOFGEN 	 in 	 2011. 	 T oday , 	 under 	 John’s 	 leadership,	
Lombard Risk is an international leader in collateralised 
trading, 	 liquidity 	 management 	 and 	 regulatory 	 compliance	
offering a wide range of products and services to 
multinational clients.
Prior	to	establishing	Lombard	Risk,	John	was	head	
of	option	trading	and	a	director	in	the	Swap	Group	
at	Kleinwort	Benson	Limited.	John	acquired	a	broad	
foundation 	 in 	 the 	 world’s 	 financial 	 markets 	 and 	 developed 	
specialisations	in	derivatives	and	banking	technology	
during	his	twelve	years	in	the	T reasury	Division	and	
Banking Division at Kleinwort Benson while based in 
London, 	 Hong 	 K ong 	 and 	 Singapore. 	 John 	 was 	 also 	 past	
chairman	until	2005	of	IDO X	plc,	a	former	subsidiary	
of	Lombard	Risk	and	now	a	leading	company	in	
UK e-government.
3. Paul Tuson 
 Chief Finance Officer
P aul 	 T uson 	 is 	 a 	 Chartered 	 Accountant 	 with 	 over 	 twenty	
years’ 	 post-qualification 	 experience 	 gained 	 in 	 both 	 the 	
profession	at	KPMG	and	in	industry	and	commerce	
in	senior	finance	roles.	He	joined	the	Board	in	2011.
P aul’s 	 experience 	 has 	 been 	 gained 	 within 	 a 	 broad 	 range	
of	businesses,	with	emphasis	on	AIM	listed	companies.	
He 	 has 	 particular 	 experience 	 in 	 the 	 media 	 and 	 technology	
sectors, 	 with 	 additional 	 experience 	 in 	 telecoms 	 and 	 retail.	
He	has	led	two	IPOs	(one	being	IPO	of	the	Y ear)	and	has	
experience	of	rapid	growth,	business	re-engineering,	
turnaround,	MB O	and	acquisitions	and	disposals.
4. Nick Davies
 Chief Technology Officer
Nick 	 Davies 	 joined 	 the 	 Board 	 of 	 Lombard 	 Risk 	 in 	 2010	
having	joined	the	firm	in	2008	as	the	Group’s	CTO .	
As 	 CTO , 	 Nick 	 has 	 global 	 responsibility 	 for 	 Lombard 	 Risk’s	
technical	vision	as	well	as	for	the	delivery	and	quality	of	
all 	 software 	 products. 	 At 	 Lombard 	 Risk 	 Nick’s 	 achievements	
include providing the architectural vision for the 
rearchitecture 	 of 	 the 	 COLLINE
®
	 Collateral 	 Management	
platform to provide additional business resilience and 
processing	capacity	capabilities.	These	architecture	
and 	 design 	 principles 	 contributed 	 to 	 COLLINE
®
 winning 
its	first	Tier	1	enterprise	client	in	early	2009.	
At	JP	Morgan	he	was	the	head	of	technology	for	three	
global	businesses:	Globeclear ,	Collateral	Management	
and	Global	T rust.	He	oversaw	the	technical	integration	
of the hedge fund acquisitions into the Alternative 
Investment group and was responsible for several high 
profile	merger	projects.	He	was	responsible	for	the	
technical teams that architected and implemented the 
JP	Morgan	CommanD	product	servicing	OT C	derivatives.
5. Brian Crowe
 Non-executive Director
Brian Crowe joined the Board of Lombard Risk in 2004 
at	the	time	of	its	IPO	on	AIM.	He	was	the	chief	executive	
of	Global	Banking	&	Markets	at	the	Royal	Bank	of	
Scotland	plc	(“RB S”)	until	October	2008.	During	his	
tenure at RBS, Brian was a member of the group ALCO, 
credit and investment committees and a member of 
the	group	executive	management	committee.	He	was	
chairman of the wholesale committee of the British 
Bankers’ Association from 2006 to 2008 and was a 
member of the global banking issues committee of the 
European	Banking	F ederation	(or	Fédération	Bancaire	
Européenne)	from	2005	to	2008.	He	was	also	a	member	
of	the	City	of	London	EU	Strategy	Group	for	2007/8.	
Prior to joining RBS, he was head of derivatives at 
Chase	Manhattan	Bank	in	London.	He	is	a	former	board	
member of the International Swaps and Derivatives 
Association	(“ISDA ”).
	 	 Note: 	 The 	 Board 	 has 	 previously 	 announced 	 Brian 	 Crowe’s 	 intention	
to resign as soon as a suitable replacement can be appointed. 16
Annual report and accounts 2013 Lombard Risk Management plc
The role of the Board
The Company is controlled through its Board of Directors. 
Ultimately, the Board’s role is the protection and 
enhancement of shareholder value. The Board provides 
overall strategy and direction for the Group and ensures 
that the necessary financial and other resources are made 
available to enable those objectives to be met. It has a 
schedule of matters reserved for its approval including, 
but not limited to, decisions on strategy and risk 
management, approval of budgets, acquisitions and 
disposals, major capital expenditure, legal and insurance 
issues, Board structure and the appointment of advisers. 
In some areas responsibility is delegated to committees 
of the Board within clearly defined terms of reference.
Once the strategic and financial objectives of the Company 
have been set by the Board it is the role of the Chief Executive 
to ensure that through the day-to-day management 
of the Group’s business they are achieved.
All Directors are subject to election by the shareholders 
at the next general meeting following appointment 
to the Board and to annual re-election. The Executive 
Directors have service contracts, which are terminable 
upon periods between three and twelve months’ notice.
The names of the current Directors together with their 
biographical details are set out in the “About us” page 
within the Lombard Risk website. 
The Directors are given access to independent professional 
advice at the Group’s expense, when the Directors deem it is 
necessary in order for them to carry out their responsibilities.
The Board meets at least six times a year and the Audit 
Committee and Remuneration Committee normally meet 
on a formal basis twice a year. 
The Board receives appropriate and timely information 
prior to each meeting, with a formal agenda and Board 
and committee papers being distributed several days 
Corporate governance report 
For the year ended 31 March 2013
Note from the Chairman
 
Dear Shareholder,
The Board is committed to high standards of 
integrity and corporate governance and consistently 
seeks to apply the principles set out in the UK 
Corporate Governance Code (“the Code”) as 
judged appropriate by the Board for an AIM 
listed company.
We recognise the importance of diversity on 
the Board and are currently seeking to replace 
Brian Crowe, who has announced his intention 
to resign after nine years’ committed, valuable 
service, with two independent Non-executives 
with business backgrounds that supplement 
the remaining members of the Board.
The Company is seeking to ensure it has 
an appropriate balance of Executive and 
Non-executive elements on its Board.
On making the anticipated appointments, the 
Board will be assessing the independence of its 
Non-executive Directors and will subsequently 
make arrangements to have its effectiveness 
assessed as set out in the Code.
Philip Crawford
Chairman
13 May 2013
Board membership
Executive Director
Non-executive Director
Philip Crawford 
(Chairman)
Brian Crowe
(Non-executive 
Director)
John Wisbey 
(Chief Executive 
Officer)
Nick Davies
(Chief Technology 
Officer)
Paul Tuson 
(Chief Finance 
Officer)
Remuneration Committee Audit Committee
Philip Crawford Brian Crowe 
(Committee 
Chairman)
Philip Crawford 
(Committee 
Chairman)
John Wisbey
Brian Crowe 17
www.lombardrisk.com Annual report and accounts 2013
Governance 14–23
before meetings take place. Any Director may challenge 
Group proposals and decisions are taken democratically 
after discussion. Any Director who feels that any concern 
remains unresolved after discussion may ask for that concern 
to be noted in the minutes of the meeting. Any specific 
actions arising from such meetings are agreed by the 
Board and then followed up by management. 
The Group maintains, for its Directors and officers, liability 
insurance for any claims against them in that capacity.
The Group has effective procedures in place to deal with 
conflicts of interest. The Board is aware of other commitments 
of its Directors and changes to these commitments are 
reported to the Board.
A summary of the Board’s main work in year ended 
31 March 2013 includes:
− − strategy and delivery, with a particular focus on the 
development of the EBA common reporting solution 
and the REFORM platform;
− − evaluation of external growth opportunities;
− − financial overview; and
− − corporate governance and compliance.
In order to ensure the effective co-operation of the Board, 
there is a clear division between the responsibilities of the 
Directors as set out below.
Directors’ roles
The Chairman’s role is to:
− − ensure good corporate governance;
− − lead the Board, ensuring the effectiveness of the Board 
in all aspects of its role;
− − ensure effective communication with shareholders; and
− − set the Board’s agenda and ensure that all Directors 
are encouraged to participate fully in the activities 
and decision-making process of the Board.
The Chief Executive Officer’s role is to:
− − lead and provide strategic direction to the Company’s 
management team;
− − run the Company on a day-to-day basis;
− − be responsible, along with the executive team, for 
implementing the decisions of the Board and its 
committees; and
− − be the Company spokesperson, communicating with 
external audiences, such as investors, analysts and 
the media.
The Non-executive Directors’ role is to:
− − challenge the opinions of the Executive Directors, 
provide fresh insight in terms of strategic direction 
and bring their diverse experience and expertise to 
the benefit of the leadership of the Group;
− − assess the performance of the Chairman;
− − provide a sounding board for the Chairman and serve 
as an intermediary for the other Directors as necessary;
− − scrutinise the performance of the Executive Directors 
in terms of meeting agreed goals and objectives;
− − be available to shareholders if they have concerns which 
contact through the normal channels of Chairman, 
Chief Executive Officer or other Executive Directors has 
failed to resolve or for which such contact is inappropriate; 
− − monitor the reporting of performance;
− − ensure that the financial information, controls and 
systems of risk management within the Group are 
robust and defensible; and
− − appoint or remove Executive Directors to or from 
the Board, when necessary.
Board length of service (years)
Philip Crawford
John Wisbey
Paul Tuson
Nick Davies
Brian Crowe
0 5 10 15 20 25 18
Annual report and accounts 2013 Lombard Risk Management plc
Corporate governance report continued
For the year ended 31 March 2013
Internal controls
The Directors are responsible for the systems of internal 
control. Although no system of internal control can provide 
absolute assurance against material misstatement or loss, 
the Group’s systems are designed to provide the Directors 
with reasonable assurance that problems are identified 
on a timely basis and dealt with appropriately. The Board 
considers that there have been no substantial weaknesses 
in internal financial controls resulting in any material losses, 
contingencies or uncertainties and thus disclosable in the 
accounts. The Board has considered the need for an internal 
audit function and has concluded that there is no current 
need for such a function within the Company.
Accounting policies
The Board considers the appropriateness of its accounting 
policies on an annual basis. The Board believes that its 
accounting policies and estimation techniques are 
appropriate, in particular in relation to income recognition, 
research and development and deferred expenses.
Information
Board reports and papers are circulated to the Directors 
in advance of the relevant Board or committee meeting. 
These papers are supplemented by information specifically 
requested by the Directors from time to time. Minutes 
of Board and committee meetings are circulated to all 
Board members.
The Non-executive Directors receive monthly management 
accounts and regular management reports and information 
which enable them to scrutinise the Group’s and 
management’s performance against agreed objectives.
Shareholder relations  
and Annual General Meeting (“AGM”)
The Company recognises the importance of dialogue 
with all of its shareholders. The AGM is an opportunity 
to communicate with institutional and other shareholders. 
The outcome of the voting on AGM resolutions is disclosed by 
means of an announcement on the London Stock Exchange.
Additional information is supplied through the circulation 
of the interim report and the annual report and accounts. 
Lombard Risk Management plc maintains up-to-date 
information on the investor section of its website,  
www.lombardrisk.com.
Every shareholder receives a full annual report after each 
year end and has access to an interim report online after 
each half year end. Care is taken to ensure that any price 
sensitive information is released to all its shareholders, 
institutional and private, at the same time in accordance 
with London Stock Exchange requirements.
Board committees
Audit Committee
The Audit Committee is a committee of the Board chaired 
by Brian Crowe and also comprises Philip Crawford. The 
Report of the Audit Committee can be found on page 21.
Remuneration Committee
The Remuneration Committee is a committee of the Board 
chaired by Philip Crawford and also comprises Brian Crowe 
and John Wisbey. The Report of the Remuneration 
Committee can be found on page 22.
Nominations Committee
The Directors do not consider that, given the size of the 
Board, it is appropriate at this stage to have a Nomination 
Committee. However, this will be kept under regular 
review by the Board. 19
www.lombardrisk.com Annual report and accounts 2013
Governance 14–23
Directors’ report 
For the year ended 31 March 2013
The Directors submit their annual report together with 
the consolidated financial statements for the year ended 
31 March 2013.
Directors’ responsibilities
The Directors are responsible for preparing the annual 
report and the financial statements in accordance with 
applicable law and regulations.
Company law requires the Directors to prepare financial 
statements for each financial year. Under that law the 
Directors have elected to prepare consolidated financial 
statements in accordance with International Financial 
Reporting Standards (“IFRS”) as adopted by the European 
Union and Parent Company financial statements in 
accordance with UK Generally Accepted Accounting 
Practice (“UK GAAP”). 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 and profit or loss of the Company and Group 
for that period. In preparing these financial statements, 
the Directors are required to:
− − select suitable accounting policies and then apply 
them consistently;
− − make judgements and estimates that are reasonable 
and prudent;
− − state whether applicable IFRS and UK GAAP have been 
followed, subject to any material departures disclosed 
and explained in the financial statements; and
− − prepare the financial statements on the going concern 
basis unless it is inappropriate to presume that the 
Company will continue in business.
The Directors are responsible for keeping adequate 
accounting records that are sufficient to show and explain 
the Company’s transactions and that disclose with reasonable 
accuracy at any time the financial position of the Company 
and enable them to ensure that the financial statements 
comply with the Companies Act 2006. They are also 
responsible for safeguarding the assets of the Company 
and hence for taking reasonable steps for the prevention 
and detection of fraud and other irregularities.
Insofar as each of the Directors is aware:
− − there is no relevant audit information of which the 
Company’s auditor is unaware; and
− − the Directors have taken all steps that they ought to 
have taken to make themselves aware of any relevant 
audit information and to establish that the auditor 
is aware of that information.
The Directors are responsible for the maintenance and 
integrity of the corporate and financial information included 
on the Company’s website. Legislation in the UK governing 
the preparation and dissemination of financial statements 
may differ from legislation in other jurisdictions.
Principal activities and Business review
The Company is a holding company. The principal 
activities of the Group are the provision of trading, 
valuation and risk management systems and regulatory 
compliance and transaction reporting systems to the 
financial markets. A review of these activities, future 
developments and financial risk management is provided 
in the Chief Executive Officer’s statement and note 16 to 
the consolidated financial statements. This information 
forms a part of the Directors’ report.
Principal risks and uncertainties
The management of the business and the nature of 
the Group’s strategy are subject to a number of risks. 
The Directors have set out in note 16 the principal risks 
facing the business.
The Directors are of the opinion that a thorough risk 
management process is adopted which involves the 
formal review of all risks identified in note 16. Where 
possible, processes are in place to monitor and mitigate 
such risks. 
Capital management
The Group generally seeks to finance all operational 
financing requirements through cash flows generated 
from operating activities, although this may be 
supplemented through capital injections if mutually 
beneficial to the Group, current shareholders and 
prospective investors. The Company’s equity structure 
is set out in note 17 to the financial statements.
Management’s objectives with respect to managing capital 
include maintaining sufficient capital to enable the Group 
to implement its strategy going forward with an optimal 
level of external debt. Part of this strategy is to generate 
a positive return to investors, both through dividend 
income and capital growth. 20
Annual report and accounts 2013 Lombard Risk Management plc
Directors’ report continued
For the year ended 31 March 2013
Key performance indicators
The Directors have monitored the performance of the 
Group with particular reference to the following key 
performance indicators:
− − turnover by product line and geography compared 
to prior year;
− − backlog and contract longevity;
− − utilisation and profitability of professional services 
against budgets and market norms;
− − cash management – actual compared to budget; and
− − operating costs by function as an absolute measure 
and as a proportion of revenues compared to prior 
periods, forecasts and market norms.
Turnover for both operating divisions, being Regulatory 
Compliance and Risk Management and Trading, were both 
in excess of 25% higher than the prior year. The increase 
in revenues was predominantly in the UK and the Americas.
Operating costs have been monitored and have increased 
consistently across both operating divisions. Resulting profits 
in the two divisions have both increased. 
Results and dividends
The audited financial statements for the year ended 
31 March 2013 are set out on pages 25 to 45. The 
Group’s profit for the year after taxation amounted 
to £3.7m (2012: £2.5m). The Directors propose a final 
dividend for the year of 0.040p (2012: 0.035p) per 
Ordinary Share of 0.5p for a total dividend of 0.065p 
(2012: 0.055p).
Directors and their interests
The Directors who served during the year and/or up to 
the date of this report and their beneficial interests in 
the Company’s Ordinary Share capital were as follows:
31 March 2013
Number
31 March 2012
Number
John Wisbey
1
102,195,117 102,195,117
Paul Tuson 1,760,000 1,500,000
Nick Davies 441,176 441,176
Philip Crawford 590,000 590,000
Brian Crowe 5,825,000 5,825,000
1  77,939,562 shares are owned directly. In addition John Wisbey is a beneficiary 
of Advanced Technology Trust which owns a further 23,700,000 shares. 
The balance, 555,555, is held by a third party.
In addition to these shareholdings listed above, the Directors 
have been granted options over Ordinary Shares.
In accordance with best practice, all Directors will retire 
at the forthcoming Annual General Meeting (“AGM”) 
and, being eligible, will offer themselves for re-election.
Payment of creditors
It is the Group’s practice to agree credit terms with 
all suppliers and to pay all approved invoices within 
these agreed terms. The average trade creditors’ days 
outstanding for the year was 26 days (2012: 35 days).
Substantial shareholdings
As at 31 March 2013 the Company has been notified 
of the following interests in 3% or more of its issued 
share capital:
Number of shares % holding
John Wisbey 102,195,117 44.0
Legal & General Group plc 19,110,000 8.2
National Bank of Canada 11,032,222 4.7
Herald Investment Trust 7,880,000 3.4
Research and development
Research and development expenditure incurred on 
the Group’s suite of products has been capitalised in line 
with the Group’s accounting policy in the relevant period. 
Amounts not capitalised have been expensed to the 
Consolidated statement of comprehensive income.
Going concern
The financial statements have, as in previous years, 
been prepared on a going concern basis. 
The Directors are required by the Companies Act 2006 
to prepare annual accounts that give a true and fair view 
and, as part of this, to decide if it is appropriate to prepare 
them on a going concern basis. In forming an opinion that 
the Company and the Group is a going concern, the Directors 
have taken particular note of the trading performance in 
the year ended 31 March 2013. This shows an improvement 
in the Group’s profits and cash balance.
The Directors have prepared cash flow forecasts for the 
period ending 30 June 2014 which show that the Company 
and Group have sufficient facilities for on-going operations. 
Whilst there will always remain some inherent uncertainty 
within the aforementioned forecasts, the Directors believe 
the Company and Group have sufficient resources to continue 
in operational existence for at least twelve months from 
the date of approval of these financial statements.
Accordingly the Directors continue to adopt the going 
concern basis in preparing the financial statements for 
the year ended 31 March 2013.
Auditor
A resolution to re-appoint Grant Thornton UK LLP as auditor 
and to authorise the Directors to agree its remuneration will 
be placed before the forthcoming AGM of the Company.
On behalf of the Board
John Wisbey
Director
13 May 2013 21
www.lombardrisk.com Annual report and accounts 2013
Governance 14–23
Report of the Audit Committee 
For the year ended 31 March 2013 
Membership and meetings of the Audit Committee
The Audit Committee is a committee of the Board and is 
composed entirely of Non-executive Directors, whom the 
Board considers to be independent. The Audit Committee 
invites the Executive Directors and other senior managers 
to attend its meetings as appropriate.
During the year the Audit Committee was chaired by 
Brian Crowe. The Audit Committee is considered to have 
sufficient, recent and relevant financial experience to 
discharge its functions. The Audit Committee invites 
others, including the external auditor, to attend its 
meetings as appropriate.
Role, responsibilities and terms of reference
The Audit Committee’s role is to assist the Board in the 
effective discharge of its responsibilities for financial 
reporting and internal control.
The Audit Committee’s responsibilities include:
− − reviewing the integrity of the annual and interim financial 
statements of the Group, ensuring they comply with 
legal requirements, accounting standards and the AIM 
Rules and any other formal announcements relating to 
the Group’s financial performance;
− − reviewing the Group’s internal financial control 
and risk management systems;
− − monitoring and reviewing the requirement for an 
internal audit function; and
− − overseeing the relationship with the external auditor, 
including approval of its remuneration, reviewing 
the scope of the audit engagement, assessing its 
independence, monitoring the provision of non-audit 
services and considering its reports on the Group’s 
financial statements.
Independence of external auditor
The Audit Committee keeps under review the relationship 
with the external auditor including:
− − the independence and objectivity of the external 
auditor, taking into account the relevant UK professional 
and regulatory requirements and the relationship with 
the auditor as a whole, including the provision of 
non-audit services;
− − recommending to the Board and shareholders the 
re-appointment or otherwise of the external auditor 
for the following financial period; and
− − the consideration of audit fees and any fees for 
non-audit services.
The Audit Committee develops and recommends to the 
Board the Company’s policy in relation to the provision 
of non-audit services by the auditor and ensures that the 
provision of such services does not impair the external 
auditor’s independence.
Brian Crowe
Chairman of the Audit Committee
13 May 2013 22
Annual report and accounts 2013 Lombard Risk Management plc
Report of the Remuneration Committee 
For the year ended 31 March 2013 
Companies quoted on AIM are not required to provide 
a formal remuneration report. Therefore this report 
is provided for information purposes to give greater 
transparency to the way Directors are remunerated.
Composition and role of the Remuneration Committee
The Board has established a Remuneration Committee 
which currently consists of Philip Crawford, Non-executive 
Chairman, who chairs the committee, Brian Crowe, 
Non-executive Director, and John Wisbey. The committee 
determines the specific remuneration packages for each 
of the Executive Directors and no Director is involved in 
any decisions as to his own remuneration. 
Framework and policy on 
Executive Directors’ remuneration
The Group’s remuneration policy is designed to provide 
competitive rewards for its Executive Directors, taking 
into account the performance of the Group and individual 
Executives, together with comparisons of pay conditions 
throughout the markets in which the Group operates. 
It is the aim of the committee to attract, retain and 
motivate high calibre individuals with a competitive 
remuneration package. It is common practice in the 
industry for total remuneration to be influenced by 
bonuses and long-term incentives.
The remuneration packages are constructed to provide 
a balance between fixed and variable rewards. Therefore 
remuneration packages for Executive Directors normally 
include basic salary, discretionary bonuses, long-term 
incentive awards and benefits in kind. In agreeing the 
level of basic salaries and annual bonuses the committee 
takes into consideration the total remuneration that 
Executive Directors could receive.
Basic salary
Basic salaries are reviewed on an annual basis. The committee 
seeks to establish a basic salary for each position, determined 
by individual responsibilities and performance taking 
into account comparable salaries for similar positions 
in companies of a similar size in the same market.
Incentive arrangements
Annual discretionary bonuses
These are designed to reflect the Group’s performance 
taking into account the performance of its peers, the 
markets in which the Group operates and the Executive 
Directors’ contribution to that performance.
Long-term incentive awards
The Group operates an option scheme for qualifying staff, 
including Executive Directors. Options are granted over 
the Company’s shares that are capable of vesting on the 
second anniversary of issue. The vesting period runs for 
three to five years from the date the options first vest. 
During the year ended 31 March 2013, options over 
1,400,000 shares were awarded to participating staff, 
none of which were awarded to Executive Directors.
Other benefits
Depending on the terms of their contracts, Executive 
Directors are entitled to contributions to pension plans, 
private medical insurance, permanent health insurance 
and life assurance.
Service contracts and notice periods
All Executive Directors have employment contracts which 
are subject to between three and twelve months’ notice 
from either the Executive or the Group, given at any time. 
Non-executive Directors
All Non-executive Directors have a remuneration agreement 
for an initial period of twelve months and thereafter on a 
rolling basis subject to three months’ notice by either the 
Non-executive Director or the Group, given at any time.
In the event of termination of their appointment they are 
not entitled to any compensation. 
Non-executive Directors’ fees are determined by the 
Executive Directors having regard to the need to attract 
high calibre individuals with the right experience, the time 
and responsibilities entailed and comparative fees paid 
in the market in which the Group operates. They are not 
eligible for pensions. They may be invited to participate 
in the Group’s option scheme. 23
www.lombardrisk.com Annual report and accounts 2013
Governance 14–23
Directors’ emoluments
The remuneration of each Director during the year ended 31 March 2013 is detailed in the table below:
 
Salary
£000
Benefits
£000
Bonus
£000
Total 
for year
ended
31 March
2013
£000
Total 
for year
ended
31 March
2012
£000
Pension
contribution
for year
ended
31 March
2013
£000
Pension
contribution
for year
ended
31 March
2012
£000
Executive
John Wisbey 215 1 — 216 209 — —
Paul Tuson 108 1 — 109 107 50 50
Nick Davies 131 — — 131 116 23 23
Non-executive
Philip Crawford 45 — — 45 45 — —
Brian Crowe 21 — — 21 20 — —
Total 520 2 — 522 472 73 73
Directors’ interest in performance share awards
Full details of outstanding performance share awards in the Company held by Executive Directors at 31 March 2013 are 
shown below:
Share options At start of year Price paid Exercise price At end of year
Date from 
which exercisable Expiry dates
Brian Crowe 800,000 — 5.5p 800,000 14/01/2013 14/01/2016
Paul Tuson 2,400,000 — 5.5p 2,400,000 14/01/2013 14/01/2016
Nick Davies 1,000,000 — 6.0p 1,000,000 20/06/2010 20/06/2013
Nick Davies 3,600,000 — 4.5p 3,600,000 28/05/2012 28/05/2015
Mike Shinya 1,050,000 — 4.5p — 28/05/2012 31/08/2012
Philip Crawford 2,400,000 — 4.5p 2,400,000 28/05/2012 28/05/2015
Philip Crawford 600,000 — 5.5p 600,000 14/01/2013 14/01/2016 24
Annual report and accounts 2013 Lombard Risk Management plc
Independent auditor’s report to the 
members of Lombard Risk Management plc
We have audited the consolidated financial statements 
of Lombard Risk Management plc for the year ended 
31 March 2013 which comprise the Consolidated 
statement of comprehensive income, the Consolidated 
balance sheet, the Consolidated statement of changes 
in shareholders’ equity, the Consolidated cash flow 
statement and the related notes. The financial reporting 
framework that has been applied in their preparation 
is applicable law and International Financial Reporting 
Standards (“IFRS”) as adopted by the European Union.
This report is made solely to the Company’s members, 
as a body, in accordance with Chapter 3 of Part 16 
of the Companies Act 2006. Our audit work has been 
undertaken so that we might state to the Company’s 
members those matters we are required to state to 
them in an Auditor’s report and for no other purpose. 
To the fullest extent permitted by law, we do not accept 
or assume responsibility to anyone other than the Company 
and the Company’s members as a body, for our audit 
work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and auditor
As explained more fully in the Directors’ responsibilities 
statement set out on page 19, the Directors are responsible 
for the preparation of the consolidated financial statements 
and for being satisfied that they give a true and fair view. 
Our responsibility is to audit and express an opinion on 
the consolidated financial statements in accordance with 
applicable law and International Standards on Auditing 
(UK and Ireland). Those standards require us to comply 
with the Auditing Practices Board’s (“APB’s”) Ethical 
Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial 
statements is provided on the APB’s website at  
www.frc.org.uk/apb/scope/private.cfm.
Opinion on financial statements
In our opinion the consolidated financial statements:
− − give a true and fair view of the state of the Group’s 
affairs as at 31 March 2013 and of its profit for the 
year then ended; 
− − have been properly prepared in accordance with 
IFRS as adopted by the European Union; and
− − have been prepared in accordance with the 
requirements of the Companies Act 2006.
Opinion on other matter 
prescribed by the Companies Act 2006
In our opinion the information given in the Directors’ 
report for the financial year for which the consolidated 
financial statements are prepared is consistent with the 
consolidated financial statements.
Matters on which we are 
required to report by exception
We have nothing to report in respect of the following:
Under the Companies Act 2006 we are required to report 
to you if, in our opinion:
− − certain disclosures of Directors’ remuneration specified 
by law are not made; or
− − we have not received all the information and explanations 
we require for our audit.
Other matter
We have reported separately on the Parent Company 
financial statements of Lombard Risk Management plc 
for the year ended 31 March 2013.
Christopher Smith
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
13 May 2013
Independent auditor’s report 
Consolidated financial statements 25
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
Consolidated statement of comprehensive income 
For the year ended 31 March 2013
Note
Year ended
31 March 
2013
£000
Year ended 
31 March 
2012
£000
Continuing operations
Revenue 2 16,768 12,758
Cost of sales (201) (123)
Gross profit 16,567 12,635
Administrative expenses (12,585) (10,118)
Profit from operations 4 3,982 2,517
Finance expense 5 (86) (32)
Finance income 6 — 2
Profit before taxation 3,896 2,487
Tax (charge) / credit 7 (182) 18
Profit for the year from continuing operations 3,714 2,505
Profit for the year from continuing operations attributable to:
Owners of the Parent 3,751 2,505
Non-controlling interest (37) —
3,714 2,505
Other comprehensive income
Exchange differences on translating foreign operations 28 (40)
Total comprehensive income for the year 3,742 2,465
Total comprehensive income attributable to:
Owners of the Parent 3,779 2,465
Non-controlling interest (37) —
3,742 2,465
Profit per share
Basic (pence) 8 1.63 1.20
Diluted (pence) 8 1.58 1.16
The accompanying accounting policies and notes form an integral part of the financial statements. 26
Annual report and accounts 2013 Lombard Risk Management plc
Company number: 03224870 Note
As at
31 March 
2013
£000
As at 
31 March 
2012
£000
Non-current assets
Property, plant and equipment 11 221 186
Goodwill 12 5,848 5,799
Other intangible assets 12 6,868 3,669
Deferred tax asset 7 503 721
13,440 10,375
Current assets
Trade and other receivables 13 3,384 4,210
Cash and cash equivalents 1,874 128
5,258 4,338
Total assets 18,698 14,713
Current liabilities
Borrowings 14 (1,013) (667)
Trade and other payables 15 (2,223) (2,512)
Deferred income (4,276) (4,449)
(7,512) (7,628)
Long-term liabilities
Borrowings 14 (667) (1,333)
Other deferred consideration 10 — (347)
(667) (1,680)
Total liabilities (8,179) (9,308)
Net assets 10,519 5,405
Equity
Share capital 17 1,592 1,484
Share premium account 6,622 5,221
Foreign exchange reserves (96) (124)
Other reserves 1,687 1,685
Profit and loss account 751 (2,861)
Equity attributable to owners of the Parent 10,556 5,405
Non-controlling interest (37) —
Total equity 10,519 5,405
The financial statements were approved by the Board on 13 May 2013 and signed on its behalf by:
John Wisbey  Paul Tuson
Chief Executive Officer  Chief Finance Officer
The accompanying accounting policies and notes form an integral part of the financial statements.
Consolidated balance sheet
As at 31 March 2013 27
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
Consolidated statement of changes in shareholders’ equity
For the year ended 31 March 2013
Share
capital
£000
Share
 premium
account
£000
Foreign 
exchange
reserves
£000
Other
reserves
£000
Profit 
and loss 
account
£000
Total
attributable 
to the
 owners 
of the 
Company 
£000
Non-
controlling 
interest
£000
Total
equity
£000
Balance at 1 April 2012 1,484 5,221 (124) 1,685 (2,861) 5,405 — 5,405
Issue of share capital 108 1,470 — — — 1,578 — 1,578
Share issue costs — (69) — — — (69) — (69)
Share-based payment charge — — — 2 — 2 — 2
Dividends — — — — (139) (139) — (139)
Transactions with owners 108 1,401 — 2 (139) 1,372 — 1,372
Profit for the year — — — — 3,751 3,751 (37) 3,714
Other comprehensive income
Exchange differences on 
translating foreign operations — — 28 — — 28 — 28
Total comprehensive income 
for the year — — 28 — 3,751 3,779 (37) 3,742
Balance at 31 March 2013 1,592 6,622 (96) 1,687 751 10,556 (37) 10,519
Share
capital
£000
Share
 premium
account
£000
Foreign 
exchange
reserves
£000
Other
reserves
£000
Profit 
and loss 
account
£000
Total
attributable 
to the
 owners 
of the 
Company 
£000
Non-
controlling 
interest
£000
Total
equity
£000
Balance at 1 April 2011 1,464 4,795 (84) 1,664 (5,263) 2,576 — 2,576
Issue of share capital 20 426 — — — 446 — 446
Share-based payment charge — — — 21 — 21 — 21
Dividends — — — — (103) (103) — (103)
Transactions with owners 20 426 — 21 (103) 364 — 364
Profit for the year — — — — 2,505 2,505 — 2,505
Other comprehensive income
Exchange differences on 
translating foreign operations — — (40) — — (40) — (40)
Total comprehensive income 
for the year — — (40) — 2,505 2,465 — 2,465
Balance at 31 March 2012 1,484 5,221 (124) 1,685 (2,861) 5,405 — 5,405
Other reserves relate to negative goodwill arising on the acquisition of a subsidiary undertaking prior to 1 April 1997, 
share-based payment and the merger reserve.
The accompanying accounting policies and notes form an integral part of the financial statements. 28
Annual report and accounts 2013 Lombard Risk Management plc
Consolidated cash flow statement
For the year ended 31 March 2013
Year ended
31 March 
2013
£000
Year ended 
31 March 
2012
£000
Cash flows from operating activities
Profit for the period 3,714 2,505
Tax charge / (credit) 182 (18)
Finance income — (2)
Finance expense 86 32
Operating profit 3,982 2,517
Adjustments for:
Depreciation 140 122
Amortisation 1,142 360
Share-based payment charge 2 21
Decrease / (increase) in trade and other receivables 825 (2,504)
(Decrease) / increase in trade and other payables (114) 315
(Decrease) / increase in deferred income (173) 1,018
Foreign exchange gains (49) (84)
Other non-cash credit (51) —
Cash generated in operations 5,704 1,765
Tax credit received 53 18
Net cash inflow from operating activities 5,757 1,783
Cash flows from investing activities
Interest received — 2
Purchase of property, plant and equipment and computer software (209) (195)
Purchase of business (see note 10) (470) (1,963)
Capitalisation of research and development costs (4,278) (3,318)
Net cash used in investing activities (4,957) (5,474)
Cash flows from financing activities
Interest paid (86) —
Loans from bank 329 2,000
Loans and other consideration paid (667) —
Shares issued, net of issue costs 1,509 140
Dividend paid (139) (103)
Net cash generated by financing activities 946 2,037
Net increase / (decrease) in cash and cash equivalents 1,746 (1,654)
Cash and cash equivalents at beginning of period 128 1,782
Cash and cash equivalents at end of period 1,874 128
The accompanying accounting policies and notes form an integral part of the financial statements. 29
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
Notes to the consolidated financial statements 
For the year ended 31 March 2013
1. Accounting policies
(A) Basis of preparation
These consolidated financial statements are for the year ended 31 March 2013. They have been prepared in accordance 
with International Financial Reporting Standards (“IFRS”) and IFRS Interpretation Committee (“IFRIC”) interpretations as 
at 31 March 2013, as adopted by the European Union. They have been prepared under the historical cost convention.
The preparation of financial statements under IFRS requires the Board to make judgements, estimates and assumptions 
that affect the application of accounting policies, the reported amounts of balance sheet items at the period end and 
the reported amount of revenue and expense during the reporting period. The estimates and associated assumptions 
are based on historical experience and various other factors that are believed to be reasonable under the circumstances, 
the results of which form the basis of making judgements that are not readily apparent from other sources. However, 
the actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an 
on-going basis.
New standards, amendments and interpretations
At the date of authorisation of these financial statements, certain new standards, amendments and interpretations 
to existing standards have been published but are not yet effective and have not been adopted early by the Group.
Management anticipates that all of the pronouncements will be adopted by the Group’s accounting policies for the 
first period beginning after the effective date of the pronouncement. Information on new standards, amendments 
and interpretations that are expected to be relevant to the Group’s financial statements is provided below. Certain 
other new standards and interpretations have been issued but are not expected to have a material impact on the 
Group’s financial statements.
− − IFRS 9 “Financial instruments” (effective 1 January 2015)  
IFRS 9 addresses the classification and measurement of financial assets and will replace IAS 39. The standard is mandatory 
for accounting periods commencing on or after 1 January 2015, subject to adoption by the European Union.
(B) Basis of consolidation
The Group accounts consolidate the financial statements of the Parent Company (Lombard Risk Management plc) and 
its subsidiary undertakings over which it has control (see note 5 to the Parent Company balance sheet). A description 
of the principal activities and operations of the Group can be found in the Directors’ report.
The consolidated financial statements include the financial statements of the Company and its subsidiary undertakings 
made up to 31 March 2013. The acquisition method of accounting has been adopted. Under this method, the results 
of subsidiary undertakings acquired or disposed of in the year are included in the Consolidated statement of comprehensive 
income from the date of acquisition or up to the date of disposal. All of the Group’s assets and liabilities existing at the 
date of acquisition are recorded at their fair values reflecting their condition at that date. Profits or losses on intra Group 
transactions are eliminated in full. Goodwill is capitalised and under IFRS 3 goodwill is not amortised but an impairment 
test is performed as appropriate, at least annually. The value of goodwill is to be written down according to the outcome 
of the impairment test.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net 
assets that is not held by the Group. The Group attributes total comprehensive income or loss of subsidiaries between 
the owners of the Parent and the non-controlling interest based on their respective ownership interest.
(C) Segment reporting 
In identifying its operating segments, management generally follows the Group’s product lines. The Group operates two 
main operating segments: Regulatory Compliance software and Risk Management and Trading software. Regulatory 
Compliance software is for regulatory, anti-money laundering and compliance systems to financial markets. Risk Management 
and Trading software provides trading, valuation and risk management systems to the financial markets. Each of these 
product lines is managed separately as they each require different technology and other resources as well as marketing 
approaches. Corporate overheads, assets and liabilities which are not directly attributable to either product line are not 
allocated to segments. 30
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
1. Accounting policies continued
(D) Going concern
The financial statements have, as in previous years, been prepared on a going concern basis. 
In forming an opinion that the Company and the Group is a going concern, the Directors have taken particular note 
of the trading performance in the year ended 31 March 2013, both in the signing of new business contracts and in the 
realised financial results. These show an improvement in profitability and an increase in the cash balance at 31 March 2013. 
The Directors have prepared a cash flow forecast for the period to 30 June 2014, which shows that the Company and 
Group have sufficient facilities for on-going operations. Whilst there will always remain some inherent uncertainty within 
the aforementioned forecasts, the Directors believe the Company and Group have sufficient resources to continue in 
operational existence for at least twelve months from the date of approval of these financial statements.
Accordingly the Directors continue to adopt the going concern basis in preparing the financial statements for the year 
ended 31 March 2013.
(E) Revenue
Revenue represents the fair value of goods sold and services provided during the year, stated net of value added tax. 
Revenue and profit before tax are wholly attributable to the principal activities of the Group.
The recognition of revenue depends on the type of income:
Licence income  For long-term projects which do not include the up-front delivery of immediately usable 
software, revenue is recognised on both the consultancy and initial licence elements in line 
with the estimated percentage of completion of the project. This estimation is based upon 
the views of the consultants implementing the projects as to the proportion of the project 
completed and this is supported by data from a time recording system. Annual licence/usage 
fees and maintenance revenue invoiced simultaneously with the initial licence, but considered 
to relate to the period when the licence is deemed to be live, is deferred in its entirety until 
the live date, following which it is released to profit in equal daily instalments over the 
duration of the relevant licence or maintenance. For other projects which do include the 
up-front delivery of immediately usable software, revenue is recognised on a percentage 
completion basis. For non-refundable licences, revenue is recognised in full on customer 
acceptance as there are no on-going obligations in respect of such sales.
Customisation income Recognised once the customisation has taken place.
Maintenance income Recognised evenly over the term of the maintenance contract.
Rental income  Recognised evenly over the term of the rental contract.
Data subscription income  Recognised evenly over the term of the data contract.
Training income Recognised when the relevant courses are run.
Multiple element transactions are allocated to relevant revenue categories based on typical revenue splits for 
transactions which are contracted separately and by using industry best practice.
(F) Property, plant and equipment
Property, plant and equipment are stated at cost, net of depreciation and any provision for impairment. No depreciation 
is charged during the period of construction. Leasehold property is included in property, plant and equipment only 
where it is held under a finance lease.
The cost of computer hardware, fixtures, fittings and equipment is written down to the residual value and is 
depreciated in equal annual instalments over the estimated useful lives of the assets. The residual values of assets 
or groups of like assets and their useful lives are reviewed annually.
The estimated useful lives of the assets are as follows: 
Computer hardware two years
Fixtures, fittings and equipment four years
(G) Goodwill
Goodwill, representing the excess of the cost of acquisition over the fair value of the Group’s share of the identifiable 
net assets acquired, is capitalised and reviewed annually for impairment. Goodwill is carried at cost less accumulated 
impairment losses. Negative goodwill is recognised immediately after acquisition in the Consolidated statement 
of comprehensive income. 31
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
1. Accounting policies continued
(H) Intangible assets
Research and development
Expenditure on research is recognised as an expense in the period in which it is incurred.
Development costs incurred are capitalised when all of the following conditions are satisfied:
− − completion of the intangible asset is technically feasible so that it will be available for use or sale;
− − the Group intends to complete the intangible asset and use or sell it;
− − the Group has the ability to use or sell the intangible asset;
− − the intangible asset will generate probable future economic benefits. Among other things, this requires that there 
is a market for the output from the intangible asset or for the intangible asset itself, or, if it is to be used internally, 
the asset will be used in generating such benefits;
− − there are adequate technical, financial and other resources to complete the development and to use or sell the 
intangible asset; and
− − the expenditure attributable to the intangible asset during its development can be measured reliably.
Development costs not meeting the criteria for capitalisation are expensed as incurred. Capitalised development costs 
are amortised in equal monthly instalments over a period of five years from the end of the month in which the costs 
were incurred. The residual values of the development assets are reviewed annually.
Computer software
The cost of computer software, net of estimated residual value and impairment, is depreciated in equal annual 
instalments over one to three years based on the estimated useful lives of the assets. The residual values of assets 
or group of like assets are reviewed annually.
Customer relationships
The cost of customer relationships, net of estimated residual value and impairment, is amortised in equal annual instalments 
over nineteen years based on the estimated useful lives of the assets. The residual values of assets or group of like assets 
are reviewed annually.
Trademarks
The cost of trademarks, net of estimated residual value and impairment, is amortised in equal annual instalments over 
seven years based on the estimated useful lives of the assets. The residual values of assets or group of like assets are 
reviewed annually.
(I) Financial instruments
Financial assets and liabilities are recognised on the Group’s balance sheet when the Group becomes a party to the 
contractual provisions of the instrument. The Group’s financial instruments comprise cash, trade receivables, borrowings 
and trade and other payables. Derivative instruments are not used by the Group and the Group does not enter into 
speculative derivative contracts.
Loans and receivables
Loans and receivables are initially stated at their fair value plus transaction costs, then subsequently at amortised cost 
using the effective interest method, if applicable, less impairment losses. Provisions against trade receivables are made 
when there is objective evidence that the Group will not be able to collect all amounts due to it in accordance with the 
original terms of those receivables. The amount of the write down is determined as the difference between the assets’ 
carrying amount and the present value of the estimated future cash flows.
Cash and cash equivalents
The Group manages short-term liquidity through the holding of cash and highly liquid interest-bearing deposits. Only 
deposits that are readily convertible into cash, with no penalty of lost interest, are shown as cash or cash equivalent.
Trade payables
Financial liabilities are obligations to pay cash or other financial assets and are recognised when the Group becomes a party 
to the contractual provisions of the instrument. Financial liabilities categorised as at fair value through profit or loss are 
recorded initially at fair value; all transaction costs are recognised immediately in the statement of comprehensive income. 
All other financial liabilities are recorded initially at fair value, net of direct issue costs.
Financial liabilities categorised as at fair value through profit or loss are re-measured at each reporting date at fair value, 
with changes in fair value being recognised in the statement of comprehensive income. All other financial liabilities are 
recorded at amortised cost using the effective interest method, with interest related charges recognised as an expense 
in finance cost in the statement of comprehensive income.
A financial liability is derecognised only when the obligation is extinguished, that is, when the obligation is discharged, 
cancelled or expires. Where debt has been converted into equity, the liability is extinguished at no gain no loss. The equity 
is measured at the carrying value of the extinguished debt. 32
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
1. Accounting policies continued
(J) Foreign exchange
Transactions in foreign currencies are translated into the functional currency of the individual entity at the exchange 
rate ruling at the date of the transaction. Monetary assets and liabilities in foreign currencies are translated at the rates 
of exchange ruling at the balance sheet date. Non-monetary items that are measured at historical cost in a foreign currency 
are translated at the exchange rate at the date of the transaction. 
Any exchange differences arising on the settlement of monetary items or on translating monetary items at rates 
different from those at which they were initially recorded are recognised in the profit or loss in the period in which 
they arise. The assets and liabilities in the financial statements of foreign subsidiaries are translated into the Parent 
Company’s presentation currency at the rate of exchange ruling at the balance sheet date. Income and expenses are 
translated at the actual rate at the date of transaction. The exchange differences arising from the retranslation of the 
opening net investment in subsidiaries are recognised in other comprehensive income and taken to the “Foreign exchange 
reserve” in equity. On disposal of a foreign operation the cumulative translation differences (including, if applicable, 
gains and losses on related hedges) are transferred to profit or loss as part of the gain or loss on disposal.
(K) Taxation
Current tax is the tax currently payable based on taxable profit for the year. Current tax credits arise from the UK legislation 
regarding the treatment of certain qualifying research and development costs, allowing for the surrender of tax losses 
attributable to such costs in return for a tax rebate.
Deferred taxes are calculated using the liability method on temporary differences. Deferred tax is generally provided on 
the difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not 
provided on the initial recognition of goodwill, nor on the initial recognition of an asset or liability unless the related 
transaction is a business combination or affects tax or accounting profit. Deferred tax on temporary differences associated 
with shares in subsidiaries and joint ventures is not provided if reversal of these temporary differences can be controlled 
by the Group and it is probable that reversal will not occur in the foreseeable future. In addition, tax losses available to 
be carried forward as well as other income tax credits to the Group are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it 
is probable that the underlying deductible temporary differences will be able to be offset against future taxable income. 
Current and deferred tax assets and liabilities are calculated at tax rates that are expected to apply to their respective 
period of realisation, provided they are enacted or substantively enacted at the balance sheet date.
Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the statement of comprehensive 
income, except where they relate to items that are charged or credited directly to other comprehensive income or equity 
in which case the related deferred tax is also charged or credited directly to other comprehensive income or equity.
(L) Leased assets
The Group does not hold any finance leases.
All leases referred to are regarded as operating leases and the payments made under them are charged to the statement 
of comprehensive income on a straight line basis over the lease term. Lease incentives are spread over the term of the lease.
Where leased buildings are vacated or under-utilised a provision is made for the loss of benefit over the remainder of the lease.
(M) Pension costs
The Group operates a number of defined contribution pension schemes. The assets of the schemes are held separately 
from those of the Group in independently administered funds. The amount charged to profit or loss represents the 
contributions payable to the schemes in respect of the accounting period.
(N) Share options issued to employees
All share-based payment arrangements granted after 7 November 2002 that had not vested prior to 1 April 2006 are 
recognised in the financial statements.
All goods and services received in exchange for the grant of any share-based payment are measured at their fair values. 
Where employees are rewarded using share-based payments, the fair values of employees’ services are determined indirectly 
by reference to the fair value of the instrument granted to the employee. This fair value is appraised at the grant date 
using a binomial model, taking into account the terms and conditions upon which the options were granted.
All equity-settled share-based payments are ultimately recognised as an expense in the statement of comprehensive 
income with a corresponding credit to “other reserves”.
If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based 
on the best available estimate of the number of share options expected to vest. Estimates are subsequently revised if there 
is any indication that the number of share options expected to vest differs from previous estimates. Any cumulative 
adjustment prior to vesting is recognised in the current period. No adjustment is made to any expense recognised in 
prior periods if share options ultimately exercised are different to that estimated on vesting.
Upon exercise of share options the proceeds received net of attributable transaction costs are credited to share capital 
and, where appropriate, share premium. 33
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
1. Accounting policies continued
(O) Impairment testing of goodwill, other intangible assets and property, plant and equipment
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable 
cash flows (cash-generating units). As a result, some assets are tested individually for impairment and some are tested 
at cash-generating unit level. Goodwill is allocated to those cash-generating units that are expected to benefit from 
synergies of the related business combination and represent the lowest level within the Group at which management 
monitors the related cash flows.
Goodwill, other individual assets or cash-generating units that include goodwill, other intangible assets with an indefinite 
useful life and those intangible assets not yet available for use are tested for impairment at least annually. All other individual 
assets or cash-generating units are tested for impairment whenever events or changes in circumstances indicate that 
the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the assets or cash-generating unit’s carrying amount exceeds 
its recoverable amount. The recoverable amount is the higher of fair value, reflecting market conditions less costs to sell, 
and value in use based on an internal discounted cash flow evaluation. Impairment losses recognised for cash-generating 
units, to which goodwill has been allocated, are credited initially to the carrying amount of goodwill. Any remaining 
impairment loss is charged pro rata to the other assets in the cash-generating unit. With the exception of goodwill, all 
assets are subsequently reassessed for indications that an impairment loss previously recognised may no longer exist.
(P) Key judgements in applying the entity’s accounting policies and goodwill impairment
The Group’s management makes estimates and assumptions regarding the future. Estimates and judgements are continually 
evaluated based on historical experience and other factors, including expectations of future events that are believed to 
be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. 
The estimates and assumptions that have a reasonable risk of causing material adjustment to the carrying amounts 
of assets and liabilities within the next financial year are discussed overleaf.
Recognition of revenue
Revenue is recognised according to the accounting policies as stated and is dependent upon the type of income. 
Where contracts include different elements of revenue, those elements are recognised in line with those policies, 
with fair values attributed to each component part.
Judgement is used in the recognition of revenue from long-term projects. 
If work is contracted on a fixed-cost basis, revenue is recognised in line with an estimation of the percentage of completion 
of the project. This estimation is based upon the views of the consultants implementing the projects as to the proportion 
of the project completed and this is supported by data from a time recording system. There is, however, an element 
of judgement involved that can impact the recognition of revenue. This process and individual project recognition is 
reviewed regularly to ensure that, whilst still subjective, the reflection of revenue is the best approximation possible.
Where projects include the up-front delivery of immediately usable software, the element of non-refundable licence 
revenue is recognised on receipt of the software by the customer, with other revenue being recognised in line with 
the performance of the contracted services. The unbundling of this contract revenue requires management to exercise 
judgement as to the relative fair values of the component parts of the contract.
Goodwill impairment
An impairment loss is recognised if the amount by which the assets or cash-generating unit’s carrying amount exceeds 
its recoverable amount. To determine the recoverable amount, management estimates expected future cash flows from 
each cash-generating unit and determines a suitable discount rate in order to calculate the present value of those cash 
flows. In the process of measuring expected future cash flows, management makes assumptions about future operating 
results. These assumptions relate to future events and circumstances. The actual results may vary and may cause significant 
adjustments to the Group’s assets within the next financial year.
In most cases, determining the applicable discount rate involves estimating the appropriate adjustment to market risk 
and the appropriate adjustment to asset-specific risk factors.
Capitalisation of development costs
Development costs are capitalised when all of the criteria (see accounting policy note above) have been met. 
Employees’ time is recorded by product and activity and valued by reference to salaries and directly attributable 
overheads. Values by product are reviewed with reference to future profitability.
Judgement is used to determine which activities constitute development that should be capitalised. In addition, 
judgement is used to determine future profitability of the products and timing thereof. 34
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
1. Accounting policies continued
(P) Key judgements in applying the entity’s accounting policies and goodwill impairment continued
Deferred tax assets
The assessment of the probability of future taxable income on which deferred tax assets can be utilised is based on the 
Group’s latest approved budget forecasts, which is adjusted for significant non-taxable income and expense. If a positive 
forecast of taxable income indicates the probable use of a deferred tax asset, especially when it can be utilised without 
a time limit, that deferred tax asset is usually recognised in respect of the period for which future profits can be confidently 
foreseen. The recognition of deferred tax assets that are subject to certain legal or economic limit or uncertainties is 
assessed individually by management based on the specific facts and circumstances.
2. Business segmentation
Management currently identifies the Group’s two product lines as operating segments as further described in 
the accounting policies. These operating segments are monitored and strategic decisions are made on the basis 
of segment operating results.
Segment information can be analysed as follows for the reporting periods under review:
Year ended 
31 March 
2013
£000
Year ended
31 March
2012
£000
Revenue
Regulatory Compliance software 7,834 5,690
Risk Management and Trading software 8,934 7,068
Group unallocated — —
Total revenue 16,768 12,758
Depreciation and amortisation
Regulatory Compliance software (599) (216)
Risk Management and Trading software (683) (266)
Group unallocated — —
Total depreciation and amortisation (1,282) (482)
Interest expense
Regulatory Compliance software — —
Risk Management and Trading software — —
Group unallocated (86) (30)
Total interest expense (86) (30)
Other costs
Regulatory Compliance software (5,306) (4,408)
Risk Management and Trading software (5,940) (4,976)
Group unallocated (258) (375)
Total other costs (11,504) (9,759)
Total costs (12,872) (10,271)
Profit
Regulatory Compliance software 1,929 1,066
Risk Management and Trading software 2,311 1,826
Group unallocated (344) (405)
Total profit before taxation and dividend 3,896 2,487
Net assets
Regulatory Compliance software 1,292 (637)
Risk Management and Trading software 8,374 6,063
Group unallocated 853 (21)
Net assets 10,519 5,405
The two segments operate independently and inter-segment income or expenditure is cross charged at arm’s length.  35
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
2. Business segmentation continued
The Group’s revenues from customers and its non-current assets are divided into the following geographical areas: 
Year ended 
31 March 
2013
£000
Year ended
31 March
2012
£000
Revenue
United Kingdom 6,541 4,426
Rest of Europe, Middle East and Africa 4,777 4,440
The Americas 4,155 2,364
Asia Pacific 1,295 1,528
Total revenue 16,768 12,758
Non-current assets
United Kingdom 6,439 3,175
The Americas 576 598
Asia Pacific 74 82
Non-current assets 7,089 3,855
In this year ended 31 March 2013 10% (2012: 10%) of the revenue depended on a single customer.
3. Directors and employees
Directors
2013
£000
2012
£000
Emoluments 522 524
Social security costs 78 61
Pension costs 73 56
673 641
No share options were exercised by the Directors. There were no pension contributions made in respect of the highest 
paid Director. During the year two Directors accrued benefits under a Company pension scheme (2012: two).
The Directors of the Company are the key management personnel.
Individual Director’s emoluments and compensation
2013
£000
2012
£000
John Wisbey 216 209
Paul Tuson 159 157
Nick Davies 154 139
Philip Crawford 45 45
Brian Crowe 21 20
Mike Shinya — 10
Total 595 580
Share options At start of year Price paid Exercise price At end of year
Date from 
which exercisable Expiry dates
Brian Crowe 800,000 — 5.5p 800,000 14/01/2013 14/01/2016
Paul Tuson 2,400,000 — 5.5p 2,400,000 14/01/2013 14/01/2016
Nick Davies 1,000,000 — 6.0p 1,000,000 20/06/2010 20/06/2013
Nick Davies 3,600,000 — 4.5p 3,600,000 28/05/2012 28/05/2015
Mike Shinya 1,050,000 — 4.5p — 28/05/2012 31/08/2012
Philip Crawford 2,400,000 — 4.5p 2,400,000 28/05/2012 28/05/2015
Philip Crawford 600,000 — 5.5p 600,000 14/01/2013 14/01/2016 36
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
3. Directors and employees continued
Individual Director’s emoluments and compensation continued
Staff costs including Directors
2013
£000
2012
£000
Wages and salaries 10,080 7,877
Social security costs 1,906 1,436
Pension costs 172 135
Share-based payments charge (note 18) 2 21
Total staff costs 12,160 9,469
The average monthly number of employees (excluding Directors) during the year was:
2013
Number
2012
Number
Office and administration 17 16
Operational 244 197
Total 261 213
4. Profit from operations
The profit from operations before taxation is stated after charging / (crediting):
2013
£000
2012
£000
Auditor’s remuneration – Company audit fee 25 25
Fees payable to the Company auditor for other services:
– subsidiary company audit fees 15 15
– tax services 12 12
– other services 5 5
Depreciation 140 122
Amortisation 1,142 360
Foreign exchange (gain) / loss (92) 46
Operating leases – land and buildings 1,289 1,148
Research and development expenditure 1,869 1,226
Fees payable to the Company’s auditor, Grant Thornton UK LLP, and its associates for non-audit services to the Company 
itself are not disclosed in the individual financial statements of the Company because the Company’s Group financial 
statements are required by the Companies (Disclosure of Auditor Remuneration and Liability Limitation Agreements) 
Regulations 2008, Regulation 5(1) to disclose such fees on a consolidated basis.
5. Finance expense
2013
£000
2012
£000
Interest on bank loans and overdrafts 86 32
6. Finance income
2013
£000
2012
£000
Interest on bank deposits — 2 37
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
7. Taxation
(A) Analysis of charge in the period
2013
£000
2012
£000
Current tax:
– UK corporation tax on profits in the period — —
– foreign tax on profits in the period (53) (18)
Total current tax credit (53) (18)
Deferred tax:
– origination and reversal of timing differences 235 —
Total deferred tax charge 235 —
Taxation charge / (credit) on ordinary activities 182 (18)
(B) Research and development tax credits
The Group has received to date research and development tax credits of £816,082 (2012: £816,082) relating to financial 
years ended 31 March 2002 to 2008. As for all companies that have received these credits, the amounts are subject 
to potential future HM Revenue & Customs claw back.
(C) Tax on profit on ordinary activities
The tax assessed for the period is the standard rate of corporation tax in the UK of 24% (2012: 26%). The difference 
is explained as follows:
2013
£000
2012
£000
Profit on ordinary activities before tax 3,896 2,487
Profit on ordinary activities multiplied by the standard rate  
of corporation tax in the UK of 24% (2012: 26%) 935 647
Effect of:
– depreciation in excess of capital allowance for the period — 27
– net utilisation of tax losses (718) (546)
– expenses not deductible for tax purposes 18 28
– tax deductibles — (156)
– foreign tax credits (53) (18)
Current tax charge / (credit) for the period 182 (18)
(D) Unrecognised deferred tax
A deferred tax asset of £0.7m (2012: £1.3m) is unrecognised and relates principally to trading losses carried forward.
(E) Deferred tax asset
The deferred tax asset included in the balance sheet relates principally to the carry forward of tax losses.
2013
£000
2012
£000
Deferred tax asset 503 721
The Directors have recognised a deferred tax asset in respect of carried forward trading tax losses as, based on current 
estimates, the Group is forecast to make sufficient trading tax profit in the future against which these losses can be 
offset. The recognised deferred tax asset is based on expected profits in the next financial year. The movement in the 
deferred tax asset in the year is recognised in full in the profit for the year; no amount is recognised directly in equity.
The deferred tax asset is expected to crystallise in full in the next financial year. 38
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
8. Profit per share
Basic profit per share has been calculated by dividing the profit after taxation by the weighted average number of 
Ordinary Shares in issue during each period.
For diluted earnings per share, the weighted average number of shares, 227,991,541 (2012: 207,946,233), is adjusted 
to assume conversion of all dilutive potential Ordinary Shares under the Group’s Enterprise Management Incentive Plan, 
being 6,755,180 (2012: 7,480,024), to give the diluted weighted number of shares of 234,746,721 (2012: 215,426,257). 
Profit per share
Year ended
31 March 
2013
Year ended
31 March 
2012
Profit for the year and basic and diluted earnings  
attributable to ordinary shareholders (pounds) 3.714m 2.505m
Weighted average number of Ordinary Shares 227,991,541 207,946,233
Profit per share (pence) 1.63 1.20
Adjusted weighted average number of Ordinary Shares 234,746,721 215,426,257
Diluted profit per share (pence) 1.58 1.16
9. Minority interest
Swapval Limited, a previously wholly owned subsidiary of the Parent Company, changed its name to Lombard Risk 
Compliance Policies Limited on 7 August 2012 and the company has since commenced trading. 20% of the issued 
share capital of the company was transferred to a third party during the year under review for £Nil consideration.
Prior to trading Lombard Risk Compliance Policies Limited had net assets of £2. 
10. Acquisition 
On 15 December 2011, the Group acquired the assets of the regulatory business of SOFGEN, including customers, 
REG-Reporter
®
 software and trademarks together with the on-going business for a consideration of £2.8m, primarily 
to expand its regulatory compliance business geographically.
The main part of the business acquired, which in the past was known in the US regulatory market as IDOM USA, is the 
US and Canada regulatory reporting product REG-Reporter
®
. REG-Reporter
®
 has a strong client base in North America. 
The purchase price for the SOFGEN business included cash of £1.963m, the issue of Ordinary Shares with a fair value 
of £305,000 and the issue of loan notes, of which £174,000 was due to be settled on 31 December 2012 and £347,000 
on 31 December 2013. The loan note due for settlement on 31 December 2013 was settled during the year under review 
for an adjusted amount of £296,000. 
Further details of the SOFGEN business acquisition are provided in note 9 to the 2012 Group financial statements, 
which are publicly available and which are also available on the Lombard Risk Management plc website. 39
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
11. Property, plant and equipment
Group
Computer
hardware
£000
Fixtures, 
fittings and 
equipment
£000
Total
£000
Cost
At 1 April 2011 1,140 706 1,846
Additions 124 71 195
Retired assets — (68) (68)
Foreign exchange effect 22 12 34
At 31 March 2012 1,286 721 2,007
1 April 2012 1,286 721 2,007
Additions 138 32 170
Foreign exchange effect 27 18 45
At 31 March 2013 1,451 771 2,222
Depreciation
At 1 April 2011 1,063 679 1,742
Charge for the year 84 38 122
Retired assets — (68) (68)
Foreign exchange effect 15 10 25
At 31 March 2012 1,162 659 1,821
At 1 April 2012 1,162 659 1,821
Charge for the year 116 24 140
Foreign exchange effect 23 17 40
At 31 March 2013 1,301 700 2,001
Net book value
At 31 March 2013 150 71 221
At 31 March 2012 124 62 186
12. Intangible assets
Group
Goodwill
£000
Capitalised
development 
costs
£000
Other 
intangible 
assets
£000
Total
£000
Cost
At 1 April 2011 3,633 — 277 3,910
Additions 2,166 3,318 664 6,148
Foreign exchange effect — — 36 36
At 31 March 2012 5,799 3,318 977 10,094
At 1 April 2012 5,799 3,318 977 10,094
Additions — 4,278 39 4,317
Foreign exchange effect 49 — 31 80
At 31 March 2013 5,848 7,596 1,047 14,491
Amortisation
At 1 April 2011 — — 266 266
Provided in the year — 287 73 360
At 31 March 2012 — 287 339 626
At 1 April 2012 — 287 339 626
Provided in the year — 1,028 114 1,142
Foreign exchange effect — — 7 7
At 31 March 2013 — 1,315 460 1,775
Net book value
At 31 March 2013 5,848 6,281 587 12,716
At 31 March 2012 5,799 3,031 638 9,468 40
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
12. Intangible assets continued
The goodwill at 31 March 2013 relates to the acquisition of STB Systems Limited, since renamed Lombard Risk 
Compliance Limited, which was acquired in 2005 and which constituted the Group’s regulatory compliance business, 
and to goodwill arising in 2011 relating to the acquisition of the regulatory reporting business of SOFGEN, further 
details of which are provided in note 10. Both these businesses now represent the Group’s regulatory compliance 
business. An impairment review has therefore been carried out on this cash-generating unit.
The cash-generating unit has been assessed by comparing its carrying value to its recoverable amount. The recoverable 
amount is the higher of fair value, reflecting market conditions less costs to sell, and value in use based on an internal 
discounted cash flow evaluation.
For the year ended 31 March 2013, the cash-generating unit recoverable amount was determined based on value-in-use 
calculations, which are based on detailed five year discounted forecast cash flows (using a discount rate of 12%). Cash 
flows for the regulatory compliance business are based on management forecasts, which are approved by the Board 
and reflect management’s expectations of sales growth, operating costs and margin based on past experience as well 
as the current order book. Management has used a five year period in the cash flow projections as the regulatory 
compliance business experiences a low level of customer turnover and the technology is based on regulations which, 
whilst subject to periodic amendment, are unlikely to be withdrawn.
For the years 2014 to 2018 no new business is forecast with retention levels of recurring revenues averaging 90% per 
annum. In view of this, no sales and marketing or research and development costs are forecast for the years 2014 to 2018.
Sensitivity to changes in key assumptions: impairment testing is dependent on management’s estimates and judgements, 
in particular in relation to the forecasting of future cash flows and the discount rate applied to the cash flows. Management 
has concluded that no reasonably possible change in the key assumptions would cause the carrying value of goodwill 
to exceed its recoverable account.
Capitalised development costs reflect the expenditure attributable to the development of new technology that will 
provide economic benefit in future periods as set out in note 1(H). 
13. Trade and other receivables
2013
£000
2012
£000
Trade receivables 2,261 2,539
Other receivables 525 793
Prepayments and accrued income 598 878
3,384 4,210
The amounts are short term and the Directors consider that the carrying amount of these trade and other receivables 
approximates to their fair value. All of the Group’s trade and other receivables have been reviewed for indications of 
impairment. As at 31 March 2013, trade receivables of £2.3m (2012: £2.5m) were fully recoverable. An impairment 
provision of £0.04m (2012: £0.24m) has been made against the invoices of twelve clients (2012: seventeen clients). 
In addition, some of the unimpaired trade receivables are past due as of the reporting date. Trade receivables past 
due but not impaired are as follows:
2013
£000
2012
£000
Not more than three months 593 985
More than three months but not more than six months 45 179
More than six months but less than one year 1 23
More than one year 8 4
647 1,191
All other receivables (non-trade) are not past due.
Movements in Group provisions for impairment of trade receivables, as included in administrative expenses, are as follows:
2013
£000
2012
£000
Opening balance 239 202
Movement in provision for receivables (200) 37
Closing balance 39 239
The Group operates in a global market with income arising in a number of different currencies, principally Sterling, 
Euros or US Dollars. Other than natural opportunities to hedge, the Group does not hedge potential future income, 
since the existence, quantum and timing of such income cannot be accurately predicted. 41
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
14. Borrowings
2013
£000
2012
£000
Bank loans payable within one year 1,013 667
Bank loans payable after one year 667 1,333
1,680 2,000
Borrowings at 31 March 2013 comprise a Sterling bank loan and a Euro bank loan. 
The Sterling bank loan is repayable in equal quarterly instalments over a three year term with the first repayment in 
April 2012. The loan principal is £2.0m and interest is payable at the rate of LIBOR + 4%. The balance outstanding 
at 31 March 2013 was £1.3m (2012: £2.0m).
The Euro bank loan is repayable in one payment on 30 April 2013. The loan principal is €0.4m and interest is payable 
at a rate of LIBOR + 4.25%. The balance outstanding at 31 March was £0.3m (2012: £Nil).
15. Trade and other payables
2013
£000
2012
£000
Trade payables 608 195
Other taxes and social security costs 843 889
Accruals and other payables 772 1,254
Loan notes (see note 10) — 174
2,223 2,512
16. Financial risk management and financial instruments
The Group’s multinational operations expose it to financial risks that include market risk, credit risk, operational risk 
and liquidity risk. The Directors review and agree policies for managing each of these risks and they are summarised 
below. These policies have remained unchanged from previous years.
Market risk
Market risk for the Group encompasses all those market risk factors that impact the value of the Group’s assets and 
liabilities and the expected value in base currency of the Group’s revenues and costs. The main risk factors are currency 
risk, inflation risk and interest rate risk. The Group’s policies for managing these are as follows:
I) Currency risk
The Group is exposed to translational and transactional foreign exchange risk as it operates in various currencies, including 
US Dollars, the Euro, Chinese Yuan, Hong Kong Dollars and Singapore Dollars, which affect the management and levels 
of working capital. Although, through its own software, the Group has access to sophisticated models for the management 
of foreign exchange risk, there has historically been no use of foreign exchange derivatives to manage this position on 
the basis that the overall effect on the Group’s income statement has not been large enough to warrant the management, 
costs and margin requirements of this activity. The Group does use natural hedges where the appropriate opportunity 
arises. In addition, the Group prepares working capital forecasts that incorporate sensitivity analysis on exchange 
rate fluctuations. The Group’s main on-going transactional exposure is to be long of Euro and US Dollars and short 
of Chinese Yuan. 
II) Inflation risk
The Group has exposure to the inflationary effect of operating in countries in which it operates, offset by its ability to 
raise prices in those countries in which it sells. This exposure could affect the Group’s cost base. The Group’s cost base 
is mainly exposed to the inflation rates and changes in payroll taxes in the UK, the US and China. The inflation rate for 
salaries in specialised parts of the financial sector in a financial centre such as London, New York or Shanghai is often 
different from the relevant country’s overall rate of wage inflation. Salary inflation in these markets and internally 
is monitored. No specific hedging of inflation risk has been carried out. 
III) Interest rate risk
Interest rate risk arises primarily on the investment of the Group’s cash balances or on its borrowings and the present 
value of the Group’s receivables. In particular, interest on the Group’s borrowings is affected by LIBOR. The Group 
finances its operations through retained cash reserves and overdraft facilities. When the Group is a net depositor of 
funds, the Group stands to gain if interest rates rise and to lose if interest rates fall, ignoring any possible positive or 
negative correlation effects with business demand for the firm’s products or inflationary pressures on the firm’s cost 
base that might arise from changes in interest rates. When the Group is a net borrower of funds, the opposite is the case. 
Although through its own OBERON
®
 software the Group has access to sophisticated models for the management of interest 
rate risk, there has been no use of interest rate derivatives to manage this position on the basis that the amounts are 
not large enough to warrant this activity. The policy of the Group is to monitor exposure to interest rate risk and take 
into account potential movements in interest rates as well as liquidity considerations when selecting methods of financing. 42
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
16. Financial risk management and financial instruments continued
Credit risk
Most of the Group’s business is with banks, asset management firms and other high-quality companies and the Group’s 
bad debt experience over fifteen years has been negligible. The Group consequently has not considered taking out 
credit insurance and is not likely to do so in the foreseeable future. Deposits are placed with high-quality banks. 
The Group closely monitors its credit risk.
Although through its own Firmament
®
 software the Group has access to sophisticated models for the management 
of credit spreads and credit derivatives, there has been no use of credit derivatives to mitigate counterparty risk and no 
such use is contemplated.
The Group’s exposure to credit risk is limited to the carrying amount of financial assets recognised at the balance sheet 
date, as summarised below: 
Classes of financial assets – carrying amounts
2013
£000
2012
£000
Cash and cash equivalents 1,874 128
Trade and other receivables 2,786 3,332
Categorised as loans and receivables 4,660 3,460
Operational risk
The Group has numerous operational risks, ranging from control over bank accounts to its processes for delivering 
and supporting software to a required level of quality and on a timely basis and retention and recruitment of key personnel. 
A key risk, as for any group, is the reputational risk that might arise from poor execution, non-delivery or late delivery 
of a high profile project or breach of client confidentiality for sensitive data. Further risks may arise where late delivery 
of software or untimely delivery of related services causes a client to miss regulatory deadlines. A detailed operational 
risk review is outside the scope of this report but the Board attaches importance to maintaining appropriate internal 
controls to identify and limit these risks; this includes integrated project management across all functions of the business. 
The Group’s Audit Committee regularly reviews controls over certain aspects of the operations of the Group.
Liquidity risk
The Group seeks to manage financial risk by ensuring that sufficient liquidity is available to meet foreseeable needs and 
by investing cash assets safely as well as profitably. The Group’s working capital report, produced each month, shows 
forecast monthly movements in working capital and cash for the following year. When required the Group has a short-term 
overdraft facility which at the year end has not been used. At 31 March 2013 the Group’s financial liabilities were as follows:
2013
£000
2012
£000
Current liabilities
Trade and other payables 1,380 1,449
Borrowings 1,013 667
Loan notes — 174
Non-current liabilities
Borrowings 667 1,333
Loan notes — 347
Categorised as financial liabilities measured at amortised cost 3,060 3,970
Maturity analysis
At 31 March 2013 the Group’s liabilities have contracted maturities which are summarised below:
2013 2012
Up to 
one year
£000
One to 
five years
£000
Up to 
one year
£000
One to 
five years
£000
Bank borrowings 1,066 684 750 1,399
Trade and other payables 1,380 — 1,449 —
Loan notes — — 174 347
Total 2,446 684 2,373 1,746
The above contractual maturities reflect the payment obligations which may differ from the carrying value of the 
liabilities at the balance sheet date. 43
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
16. Financial risk management and financial instruments continued
Interest rate sensitivity
The Group is exposed to changes in market interest rates (LIBOR) through the bank borrowings obtained during the 
current and prior year at a variable interest rate.
The following table illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates 
(LIBOR) of +1% or –1%. These changes are considered to be reasonably possible based on observations of current 
market conditions. These calculations are based on a change in the average market interest rate for each period and 
the financial instruments held at each reporting date that are sensitive to changes in interest rates. All other variables 
are held constant.
Profit for the year Equity
£000 £000 £000 £000
LIBOR +1% –1% +1% –1%
31 March 2013 3,697 3,731 10,502 10,536
Capital management
The Group’s capital management objectives are to ensure the Group’s ability to continue as a going concern and to 
provide an adequate return to shareholders. The Group monitors capital in proportion to risk and makes adjustments 
in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain 
or adjust the capital structure the Group may adjust the amount of dividends paid to shareholders, issue new shares or 
sell assets to reduce debt.
The Group had bank borrowings of £1.7m as at the year end. In line with the terms of that debt the Group monitors 
capital on the basis of three covenants in place over the debt, being:
− − total net debt to adjusted EBITDA;
− − EBITDA to net finance charge; and
− − cash flow to debt service.
All covenants were satisfied at 31 March 2013.
17. Share capital
2013
£000
2012
£000
Authorised
714,034,085 Ordinary Shares of 0.5p each (2012: 714,034,085) 3,570 3,570
Allotted, called up and fully paid
232,409,897 Ordinary Shares of 0.5p each (2012: 210,809,897) 1,162 1,054
429,829,575 deferred shares of 0.1p each (2012: 429,829,575) 430 430
1,592 1,484
The deferred shares carry no rights to receive dividends or to participate in any profits of the Company. The shareholders 
are not entitled to attend any meetings of the Company or have any rights to participate in any return of capital (except 
on a winding up). The deferred shares are not transferable other than with the consent of all the Directors of the Company.
Share issue
On 6 June 2012, the Company issued 20,000,000 Ordinary Shares of 0.5p per share in order to accelerate growth, 
to recruit certain key staff and to provide cash for potential acquisition opportunities. The shares were issued at a 
premium of 7.0p per share, which has been credited to the share premium account, net of issue costs of £69,000.
On 19 July 2012, the Company issued 1,050,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 4.0p per share, which 
has been credited to the share premium account.
On 31 January 2012, the Company issued 250,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which 
has been credited to the share premium account.
On 7 March 2013, the Company issued 300,000 Ordinary Shares at 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which 
has been credited to the share premium account. 44
Annual report and accounts 2013 Lombard Risk Management plc
Notes to the consolidated financial statements continued
For the year ended 31 March 2013
18. Share options
Employee share options charge
The fair value is based on a number of assumptions as stated below.
In accordance with the accounting policy stated under note 1(N), the volatility of the Company’s shares for the relevant 
period has been estimated at 30%, giving a charge to the profit and loss account for the year ended 31 March 2013 
of £2,445 (2012: £21,000), with the same amount being credited to reserves. The expected volatility has been based 
on historical volatility, using market prices of Lombard Risk Management plc shares between 4 September 2004 and 
31 March 2010.
Equity-settled share-based payments
The Company has a share option scheme for all employees. Options are granted to employees based on the discretion 
of the Directors to reward performance. The options are settled in equity once exercised. If the options remain unexercised 
after the end of the exercising period, the options expire. Options are forfeited if the employee leaves the Company.
The fair values of the options were calculated using a numerical binomial model assuming the inputs shown below:
At start
 of year Granted Exercised
Lapsed/
waived
At end
 of year
Exercise
 price (p)
Exercise
 date from
Exercise
 date to
2004 EMI 
Scheme
1,790,000 — — (70,000) 1,720,000 9.00 April 2008 April 2013
300,000 — — — 300,000 9.00 December 2008 December 2013
1,500,000 — — — 1,500,000 6.00 October 2011 October 2016
1,000,000 — — — 1,000,000 6.00 June 2010 June 2015
1,414,365 — — — 1,414,365 4.50 May 2012–  
May 2014
May 2015
4,710,000 — (550,000) — 4,160,000 5.50 January 2013 January 2016
Unapproved 
Scheme
70,000 — — — 70,000 9.00 April 2008 April 2013
6,685,635 — (1,050,000) (1,050,000) 4,585,635 4.50 May 2012–  
May 2014
May 2015
1,700,000 — — (100,000) 1,600,000 5.50 January 2013 January 2016
— 500,000 — — 500,000 12.00 April 2014 April 2017
— 900,000 — — 900,000 12.00 May 2014 May 2017
19,170,000 1,400,000 (1,600,000) (1,220,000) 17,750,000
Details of share options granted during the year are as follows:
Grant date
15 May
2012
26 April
2012
Share price at grant 8.20p 7.95p
Exercise price 12.00p 12.00p
Contractual life (years) 3 3
Staff turnover 50% 50%
Risk-free rate Discount curve used for UK on the day of valuation
Expected volatility 30% 30%
Expected dividend yield — —
Fair value of option 1.61p 1.07p
Details of the number of share options and the weighted average exercise price (“WAEP”) outstanding during the year 
are as follows:
2013
Number
2013
WAEP
2012
Number
2012
WAEP
Outstanding at beginning of the year 19,170,000 5.54p 24,955,000 6.01p
Granted during the year 1,400,000 12.00p — —
Exercised during the year (1,600,000) 4.84p (1,555,555) 9.00p
Lapsed during the year (1,220,000) 4.84p (4,229,445) 7.29p
Outstanding at end of the year 17,750,000 6.16p 19,170,000 5.54p
Exercisable at the year end 12,350,000 4,660,000 45
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
18. Share options continued
Equity-settled share-based payments continued
The share options outstanding at the end of the year have the following exercise prices:
Expiry date
Exercise 
price
2013
Number
2012
Number
24 April 2013 9.0p 1,790,000 1,860,000
28 May 2013 4.5p 2,000,000 2,700,000
1 December 2013 9.0p 300,000 300,000
28 May 2014 4.5p 2,000,000 2,700,000
28 May 2015 4.5p 2,000,000 2,700,000
20 June 2015 6.0p 1,000,000 1,000,000
14 January 2016 5.5p 5,760,000 6,410,000
19 October 2016 6.0p 1,500,000 1,500,000
26 April 2017 12.0p 500,000 —
15 May 2017 12.0p 900,000 —
17,750,000 19,170,000
The weighted average remaining contractual life of share options outstanding at the year end was 2.1 years (2012: 2.8 years).
19. Operating leases
The Group had commitments under non-cancellable operating leases in respect of land and buildings. The Group’s 
future minimum operating lease payments are as follows:
2013
£000
2012
£000
Within one year or less 1,220 1,218
Within one to five years 933 2,130
Total 2,153 3,348
20. Pensions
A Group company contributes to a defined contribution pension scheme on behalf of a limited number of employees 
of that subsidiary. The assets of the scheme are administered by trustees in a fund independent of the Company. Other 
defined contribution pension schemes to which the Group makes contributions on behalf of employees are of the 
stakeholder variety, again totally independent of the Company.
21. Related party transactions
There are no related party transactions in this reporting year or comparative period. 
Key management of the Group are the Directors of the Parent Company. Details of the Directors’ remuneration are set 
out in note 3 and in the Remuneration Committee report.
22. Controlling personnel related parties
In the opinion of the Directors, there is no ultimate controlling party at 31 March 2013.
23. Dividends
During 2013, Lombard Risk Management plc paid a dividend of £139,000 (2012: £103,000) to its equity shareholders. 
This represents a payment of 0.06p per share (2012: 0.04p).
Also during 2013, the Directors proposed a dividend of 0.040p per share (2012: 0.035p). As the distribution of the 
dividends by Lombard Risk Management plc requires the approval at the shareholders’ meeting, no liability in this 
respect is recognised in the 2013 consolidated financial statements. No income tax consequences for Lombard Risk 
Management are expected to arise as a result of this transaction. 46
Annual report and accounts 2013 Lombard Risk Management plc
Independent auditor’s report to the members of Lombard Risk Management plc
We have audited the Parent Company financial statements of Lombard Risk Management plc for the year ended 
31 March 2013 which comprise the Parent Company balance sheet and the related notes. The financial reporting 
framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards 
(United Kingdom Generally Accepted Accounting Practice).
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the 
Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those 
matters we are required to state to them in an Auditor’s report and for no other purpose. To the fullest extent permitted 
by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members 
as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and auditor
As explained more fully in the Directors’ responsibilities statement set out on page 7, the Directors are responsible for 
the preparation of the Parent Company financial statements and for being satisfied that they give a true and fair view. 
Our responsibility is to audit and express an opinion on the Parent Company financial statements in accordance with 
applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the 
Auditing Practices Board’s (“APBs”) Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the APB’s website at  
www.frc.org.uk/apb/scope/private.cfm.
Opinion on financial statements
In our opinion the Parent Company financial statements:
− − give a true and fair view of the state of the Company’s affairs as at 31 March 2013;
− − have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
− − have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Directors’ report for the financial year for which the financial statements 
are prepared is consistent with the Parent Company financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report 
to you if, in our opinion:
− − adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have 
not been received from branches not visited by us; or
− − the Parent Company financial statements are not in agreement with the accounting records and returns; or
− − certain disclosures of Directors’ remuneration specified by law are not made; or
− − we have not received all the information and explanations we require for our audit.
Other matter
We have reported separately on the Group financial statements of Lombard Risk Management plc for the year ended 
31 March 2013. 
Christopher Smith
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
13 May 2013
Independent auditor’s report
Parent Company financial statements 47
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
Company number: 03224870 Note
As at
31 March 
2013
£000
As at
31 March 
2012
£000
Fixed assets
Tangible assets 4 109 61
Intangible assets 4 10 22
Investments in subsidiaries 5 12,611 12,611
12,730 12,694
Current assets
Debtors due within one year 6 5,957 5,142
Cash at bank and in hand 90 —
6,047 5,142
Creditors: amounts falling due within one year 7 (1,648) (1,558)
Net current assets 4,399 3,584
Total assets less current liabilities 17,129 16,278
Creditors: amounts falling due after more than one year 8 (667) (1,333)
Net assets 16,462 14,945
Capital and reserves
Called up share capital 10 1,592 1,484
Share premium 11 6,622 5,221
Other reserves 11 7,197 7,195
Profit and loss account 11 1,051 1,045
Shareholders’ funds 16,462 14,945
The financial statements were approved by the Board on 13 May 2013 and signed on its behalf by:
John Wisbey Paul Tuson
Chief Executive Officer Chief Finance Officer
The accompanying accounting policies and notes form an integral part of these financial statements.
Company balance sheet
As at 31 March 2013 48
Annual report and accounts 2013 Lombard Risk Management plc
1. Accounting policies
(A) Basis of preparation
The separate financial statements of the Company are presented as required by the Companies Act 2006. As permitted 
by that Act, the separate financial statements have been prepared in accordance with all applicable United Kingdom 
Accounting Standards and on a historical cost basis.
(B) Going concern
The financial statements have, as in previous years, been prepared on a going concern basis. 
In forming an opinion that the Company and the Group is a going concern, the Directors have taken particular note 
of the trading performance in the year ended 31 March 2013, both in the signing of new business contracts and in the 
realised financial results. These show continued profitability and an increase in the cash balance at 31 March 2013. 
The Directors have prepared a cash flow forecast for the period to 30 June 2014, which shows that the Company 
and Group have sufficient facilities for on-going operations. Whilst there will always remain some inherent uncertainty 
within the aforementioned forecasts, the Directors believe the Company and Group have sufficient resources to 
continue in operational existence for at least twelve months from the date of approval of these financial statements.
Accordingly the Directors continue to adopt the going concern basis in preparing the financial statements for the year 
ended 31 March 2013.
(C) Foreign exchange
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and 
liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date. 
All differences are taken to the profit and loss account.
(D) Deferred taxation
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance 
sheet date where transactions or events that result in an obligation to pay more, or a right to pay less, tax in the future 
have occurred at the balance sheet date. Deferred tax assets are recognised when it is more likely than not that they 
will be recovered. Deferred tax is measured using rates of tax that have been enacted or substantively enacted by the 
balance sheet date.
(E) Leased assets
All leases held by the Company are regarded as operating leases and the payments made under them are charged 
to the profit and loss account on a straight line basis over the lease term.
(F) Fixed and intangible assets
Depreciation is provided using the following rates and bases so as to write off the cost or valuation of fixed and 
intangible assets over their useful lives in the Company’s business:
Computer software 50% to 100% straight line
Computer hardware 50% straight line
Fixtures, fittings and equipment 25% straight line
(G) Investments in subsidiaries
Investments in subsidiaries are recorded at cost less any provision for permanent diminution in value.
2. Directors and employees
Staff costs including Directors
2013
£000
2012
£000
Wages and salaries 1,535 1,237
Social security costs 252 208
Pension costs 9 —
Share-based payments charge (note 18 to the consolidated financial statements) 2 21
Total staff costs 1,798 1,466
3. Profit for the financial year
The Parent Company has taken advantage of Section 408 of the Companies Act 2006 and has not included its own 
income statement in these financial statements. The Parent Company’s profit for the year was £145,000 (2012: £172,000).
Notes to the Company financial statements
For the year ended 31 March 2013 49
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
4. Fixed assets
Company
Computer
hardware
£000
Fixtures, 
fittings and 
equipment
£000
Computer
software
£000
Total
£000
Cost 
At 1 April 2012 878 427 308 1,613
Additions 82 23 26 131
At 31 March 2013 960 450 334 1,744
Depreciation 
At 1 April 2012 829 415 286 1,530
Charge for the year 50 7 38 95
At 31 March 2013 879 422 324 1,625
Net book value
At 31 March 2013 81 28 10 119
At 31 March 2012 49 12 22 83
5. Investments in subsidiaries
Investments in subsidiaries
2013
£000
2012
£000
At 1 April and 31 March 12,611 12,611
The Directors have considered the carrying value of the investments in subsidiaries and have concluded, on the basis 
of forecast financial performance of the subsidiaries, that no impairment in value has taken place and therefore that 
no provision is currently required.
At 31 March 2013 the undertakings in which the Company held more than 20% of the allotted share capital were as follows:
 
Proportion of Ordinary Share 
capital held
By Parent 
(%)
By Group 
(%)
Country of 
incorporation Business
Lombard Risk Systems Limited 100 100 UK Software
Lombard Risk Compliance Limited 100 100 UK Software
Lombard Risk International Limited 100 100 China Software
Lombard Risk Systems Inc. — 100 US Software
Lombard Risk International (USA) Inc. — 100 US Software
Lombard Risk International (Hong Kong) Limited — 100 Hong Kong Software
Lombard Risk International (Singapore) Limited — 100 Singapore Software
Lombard Risk Consultants Limited 100 100 UK Services
Lombard Risk Systems (Asia Pacific) Limited — 100 Hong Kong Dormant
Lombard Risk Compliance Policies Limited (formerly Swapval Limited) 80 80 UK Software
All of the subsidiary undertakings have been included in the consolidation. Swapval Limited changed its name to 
Lombard Risk Compliance Policies Limited on 7 August 2012 and the company has since commenced trading. 20% 
of the issued share capital of the company was transferred to a third party during the year under review.
6. Debtors due within one year
2013
£000
2012
£000
Amounts receivable from subsidiary undertakings 5,861 4,976
Prepayments and sundry debtors 96 108
Other debtors — 25
Deferred tax asset (note 9) — 33
5,957 5,142
The amounts due from subsidiary companies are due on demand. However, in the opinion of the Directors, it is unlikely 
that these amounts will be fully repaid within the next financial year.
The deferred tax asset in 2012 crystallised in full during the year under review. 50
Annual report and accounts 2013 Lombard Risk Management plc
7. Creditors due within one year
2013
£000
2012
£000
Borrowings 1,013 667
Trade creditors 287 168
Accruals 348 723
1,648 1,558
8. Creditors due after one year
2013
£000
2012
£000
Borrowings 667 1,333
Borrowings at 31 March 2013 comprise a Sterling bank loan and a Euro bank loan. 
The Sterling bank loan is repayable in equal quarterly instalments over a three year term with the first repayment 
in April 2012. The loan principal is £2.0m and interest is payable at the rate of LIBOR + 4%. The balance outstanding 
at 31 March 2013 was £1.3m.
The Euro bank loan is repayable in one payment on 30 April 2013. The loan principal is €0.4m and interest is payable 
at a rate of LIBOR + 4.25%. The balance outstanding at 31 March 2013 was £0.3m.
9. Taxation
The deferred tax asset in the balance sheet relates to the carry forward of tax losses.
2013
£000
2012
£000
Deferred tax asset — 33
The Directors previously recognised a deferred tax asset in respect of carried forward trading tax losses as, based 
on current estimates at 31 March 2012, the Company was forecast to make sufficient trading tax profit in the future 
against which these losses could be offset. The deferred tax asset was utilised in full during the year under review. 
There are no unrecognised tax losses carried forward at 31 March 2013 (2012: £Nil).
10. Share capital
2013
£000
2012
£000
Authorised
714,034,085 Ordinary Shares of 0.5p each (2012: 714,034,085) 3,570 3,570
Allotted, called up and fully paid
232,409,897 Ordinary Shares of 0.5p each (2012: 210,809,897) 1,162 1,054
429,829,575 deferred shares of 0.1p each (2012: 429,829,575) 430 430
1,592 1,484
Share issue
On 6 June 2012, the Company issued 20,000,000 Ordinary Shares of 0.5p per share in order to accelerate growth, 
to recruit certain key staff and to provide cash for potential acquisition opportunities. The shares were issued at a 
premium of 7.0p per share, which has been credited to the share premium account, net of issue costs of £69,000.
On 19 July 2012, the Company issued 1,050,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided overleaf. The shares were issued at a premium of 4.0p per share, which 
has been credited to the share premium account.
On 31 January 2012, the Company issued 250,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided overleaf. The shares were issued at a premium of 5.0p per share, which 
has been credited to the share premium account.
On 7 March 2013, the Company issued 300,000 Ordinary Shares at 0.5p per share as part of the Company’s share 
option scheme; further details are provided overleaf. The shares were issued at a premium of 5.0p per share, which 
has been credited to the share premium account.
Notes to the Company financial statements continued
For the year ended 31 March 2013 51
Financial statements 24–51
www.lombardrisk.com Annual report and accounts 2013
10. Share capital continued
Share options
At start
 of year Granted Exercised
Lapsed/
waived
At end
 of year
Exercise
 price (p)
Exercise
 date from
Exercise
 date to
2004 EMI 
Scheme 1,790,000 — — (70,000) 1,720,000 9.00 April 2008 April 2013
300,000 — — — 300,000 9.00 December 2008 December 2013
1,500,000 — — — 1,500,000 6.00 October 2011 October 2016
1,000,000 — — — 1,000,000 6.00 June 2010 June 2015
1,414,365 — — — 1,414,365 4.50 May 2012 May 2015
4,710,000 — (550,000) — 4,160,000 5.50 January 2013 January 2016
Unapproved 
Scheme 70,000 — — — 70,000 9.00 April 2008 April 2013
6,685,635 — (1,050,000) (1,050,000) 4,585,635 4.50 May 2012 May 2015
1,700,000 — — (100,000) 1,600,000 5.50 January 2013 January 2016
— 500,000 — — 500,000 12.00 April 2014 April 2017
— 900,000 — — 900,000 12.00 May 2014 May 2017
19,170,000 1,400,000 (1,600,000) (1,220,000) 17,750,000
The deferred shares carry no rights to receive dividends or to participate in any profits of the Company. The shareholders 
are not entitled to attend any meetings of the Company or have any rights to participate in any return of capital (except on 
a winding up). The deferred shares are not transferable other than with the consent of all the Directors of the Company.
11. Share premium and other reserves
Share 
capital
£000
Share 
premium
account
£000
Other
reserves
£000
Profit 
and loss 
account
£000
Shareholders’
funds
£000
Balance at 1 April 2012 1,484 5,221 7,195 1,045 14,945
Issue of share capital, net of issue costs 108 1,401 — — 1,509
Profit for the year — — — 145 145
Dividend — — — (139) (139)
Share-based payment charge — — 2 — 2
Balance at 31 March 2013 1,592 6,622 7,197 1,051 16,462
Other reserves relate to negative goodwill arising on the acquisition of a subsidiary undertaking prior to 1 April 1997, 
merger reserve and net foreign exchange movements in connection with overseas subsidiaries.
12. Related party transactions
The Company has taken advantage of the exemption in Financial Reporting Standard 8 “Related party disclosures” and 
has not disclosed transactions with wholly owned Group undertakings.
The Company charged £64,000 (2012: £Nil) to Lombard Risk Compliance Policies Limited in respect of support services 
provided. The balance owed by Lombard Risk Compliance Policies Limited to the Company at 31 March 2013 was 
£263,000 (2012: £Nil).
There are no other related party transactions in this reporting year or comparative period. 52
Annual report and accounts 2013 Lombard Risk Management plc
Company registration number
03224870
Directors
Philip Crawford 
Chairman
John Wisbey
Chief Executive Officer
Paul Tuson 
Chief Finance Officer
Nick Davies
Chief Technology Officer
Brian Crowe
Non-executive Director
Company Secretary
Paul Tuson
Registered office
7th Floor  
Ludgate House 
245 Blackfriars Road 
London SE1 9UF
Nominated adviser and broker
Charles Stanley Securities
131 Finsbury Pavement  
London EC2A 1NT
Auditor
Grant Thornton UK LLP
Grant Thornton House 
Melton Street 
Euston Square 
London NW1 2EP
Corporate solicitors
Memery Crystal
44 Southampton Buildings 
London WC2A 1AP
Registrars
Computershare Investor Services PLC
PO Box 859 
The Pavilions 
Bridgwater Road 
Bristol BS99 1XZ
Date
Annual General Meeting 
12 July 2013
Company information  Lombard Risk Management plc
7th Floor 
Ludgate House 
245 Blackfriars Road 
London SE1 9UF 
UK 
tel: +44 (0)20 7593 6700 
fax: +44 (0)20 7593 6780 
e: investorrelations@lombardrisk.com
www.lombardrisk.com
Lombard Risk Management plc Annual report and accounts 2013