2_
contents
contents
Highlights 2
Group profile 3
Chairman’s report 4
Chief Executive’s review 8
Financial review 12
Directors and senior management 16
Directors’ report 20
Corporate governance 22
Directors’ remuneration report 26
Statement of directors’ responsibilities 31
Corporate social responsibility report 32
Independent auditors report to the members of NCC Group plc 34
Consolidated income statement 35
Group balance sheet 36
Company balance sheet 37
Group cash flow statement 38
Company cash flow statement 39
Statement of changes in equity 40
Notes 42
Company information 72
LARGEST SOFTWARE ESCROW PROVIDER
NCC GROUP IS THE WORLD’S _1 _1
UK:
Head office
Manchester, United Kingdom
t +44 (0)161 209 5200
F +44 (0)161 209 5100
e response@nccgroup.com
www.nccgroup.com
London Office
United Kingdom
t +44 (0)20 7383 9170
F +44 (0)20 7383 9179
e response@nccgroup.com
www.nccgroup.com
Dorking Office
United Kingdom
t +44 (0)870 850 8520
F +44 (0)870 850 8521
e  info@siteconfidence.com
www.siteconfidence.com
Thame Office
United Kingdom
t +44 (0)1844 210 300
F +44 (0)8709 908 423
e  enquiries@securetest.com
www.securetest.com
europe
Amsterdam Office
Netherlands
t +31 (0)20 620 7151 
F +31 (0)20 420 1733 
e info@escroweurope.com
www.escroweurope.com 
Munich Office
Germany
t +49 (0)89 599 762 0
F +49 (0)89 599 762 599
e europe@nccgroup.com
www.nccgroup.de
UsA
San Jose Office
California, USA
t +1 408 441 4660
F +1 408 441 4658
e usa@nccgroup.com
www.nccgroupusa.com
the ncc Group of companies
Recycled paper 2_
INCREASED
BY 41%
GRoUP ReVenUe
Financial Highlights
n
 Group revenue up by 41% to £35.7m (2007: £25.4m)
- Escrow Solutions revenue up by 20% to £18.0m
- Assurance Testing revenue up by 121% to £12.8m
- Consultancy revenue up by 7% to £4.9m 
n
  Group adjusted operating profits* up by 30% to £10.7m  
(2007: £8.2m)
- Escrow Solutions operating profits up by 28% to £10.2m
- Assurance Testing operating profits up by 127% to £1.7m
- Consultancy operating profits up by 1% to £0.7m 
n
 Group adjusted operating margins* at 30% (2007: 32%)
n
  Group adjusted pre tax profits* up by 29% to £10.5m 
(2007: £8.1m)
n
  Adjusted fully diluted earnings per share* up 33% to 22.4p 
(2007: 16.8p)
n
  Final dividend proposed of 4.75p giving a total dividend 
of 7.00p up 47% from last year
Acquisitions 2008
n
 Two acquisitions completed and integrated in the year;
-  Secure Test a Penetration and Security Testing business in 
August 2007 for up to £4.0m
-  Escrow Europe B.V. in January 2008 for up to €10.5m  
confirming our position as the world’s largest software 
Escrow provider
*Operating profit is adjusted for amortisation of acquired intangibles of £740,000 
and exceptional costs of £711,000 relating to the move to the Official List and 
the costs of reorganising Escrow Europe’s corporate and contractual structure. 
Pre tax profit is adjusted for these items and the unwinding of the discount on 
the acquisitions deferred consideration of £333,000. The Directors believe the 
adjusted measures better reflect the ongoing performance of the business.
HIGHLIGHts
NCC Group annual report and accounts 2008 _3 _3
NCC Group is a leading global provider of independent IT 
assurance, security and consultancy services. As a trusted 
advisor, we help over 15,000 public, private and not for profit 
sector organisations, including 94 of the FTSE 100, to make 
the most efficient use of information and technology and to 
manage the associated risks.
Our independence from hardware and software providers 
ensures the advice we offer is unbiased and impartial. We 
focus on developing intelligent solutions to real business issues 
and building lasting partnerships through our comprehensive 
portfolio of IT assurance, security and consultancy services.
With a head office in Manchester and offices throughout 
England, continental Europe and the USA, NCC Group 
serves the needs of a wide variety of clients worldwide. We 
are listed on the Official List of the London Stock Exchange.
The Group operates three complementary divisions. The 
Escrow Solutions division trades under the NCC Group 
Escrow brand whilst Assurance Testing trades under the 
NCC Group Secure Test and the Site Confidence brands. 
The Consultancy division operates under the NCC Group 
Consultancy brand. 
All the divisions are encompassed under the NCC Group 
plc banner which enables us to assure, secure and advise 
our clients.
escrow solutions:
n
  Ensuring business critical material or source code is 
protected and accessible should anything happen to a 
key supplier and enabling stronger supplier relationships
n
  Confirming the material held is properly protected by 
verifying it can be rebuilt from its components 
Assurance testing:
n
  Site Confidence – testing and monitoring relevant aspects 
of system, network and website performance to ensure 
the technology used can deliver optimum performance
n
  Secure Test – penetration and security testing of networks 
and applications and security policies in practice to 
ensure organisations are safe from the constantly evolving 
threat of unauthorised access
consultancy:
n
  Providing advice at all levels to help organisations 
improve their performance through the effective use of 
information, technology and business processes
n
  Protecting organisations against a variety of risks through 
the development and implementation of effective plans 
and compliance with relevant standards and guidelines
GRoUP PRoFILe
_3
Recycled paper 4_
overview
This year NCC Group plc has delivered its strongest 
performance to date and is reporting a full year for the first 
time as a fully quoted company on the Official List on the 
London Stock Exchange. Yet again, we saw an excellent 
performance from all areas of the Group and in addition 
we completed two acquisitions, further strengthening 
the Group’s capability in both Escrow Solutions and 
Assurance Testing.
Overall Group revenues for the year grew by 41% to £35.7m 
(2007: £25.4m). Excluding the acquisitions, the Group showed 
very strong organic growth up 17%. Adjusted operating 
profits increased by 30% to £10.7m (2007: £8.2m). As a 
Group, we continue to generate strong margins, with our 
adjusted operating profit margin remaining strong at 30% 
(2007: 32%) in line with expectations. 
Adjusted pre-tax profits were up 29% to £10.5m (2007: £8.1m) 
and fully diluted adjusted earnings per share increased 33% 
to 22.4p (2007: 16.8p). 
The Group continues to be highly cash generative 
and had only £3.4m net debt at the year end, despite 
meeting the £10.4m cost of two acquisitions out of cash 
resources. Operating cash conversion represented 122% of 
operating profits.
Over the longer term NCC Group has shown consistent, strong 
and reliable growth. Since the Group gained admission to 
AIM in 2004, followed by its switch to the Official List in July 
2007, revenues have grown at a compound annual growth 
rate (CAGR) of over 25%. Adjusted pre tax profits have seen 
a CAGR rate of over 22%. The Group has generated £34m 
of cash from operations before interest, tax and dividends.
 
Total shareholder returns over the four years since flotation 
are 137%. This is not just a testament to a successfully 
implemented strategy exploiting market conditions but also 
to excellent operational management at all levels.
operations
The acquisition of Secure Test in August 2007 was a very 
positive move for us. Not only did it confirm our commitment 
to this market place, but it has proved to be a highly 
successful complementary business. In addition, it has 
allowed us to develop and maintain the largest team of 
accredited Security and Penetration Testers in the UK, as we 
seek to become the leading player in the market.
The acquisition of Escrow Europe had been a long time 
coming and we were delighted to complete the purchase of 
the business in January 2008 after many years of negotiation. 
This acquisition provides us with a strong European base from 
which to operate and strengthens our German business. 
It allows us to grow our multi national customer base by 
providing local agreements and account management in 
culturally aligned ways. 
Our Escrow businesses worldwide have performed very 
well with each country delivering good growth in revenues 
and operating profits. In Escrow Solutions UK, contract and 
beneficiary terminations remained around 10% and net 
new beneficiary growth was 12%. Verification Testing saw 
revenues grow by 26% to £3.0m (2007: £2.4m). 
Escrow Europe, which predominately operates from the 
Netherlands, saw a good first five months of trading under 
our ownership. The business integration is now complete and 
we are actively recruiting Account Managers to grow the 
already substantial but underperforming customer base. Our 
existing German business has grown well on a substantially 
reduced cost base and revenues grew by 21% enabling 
the business to break even. The inclusion of the Escrow 
Europe German renewals base will now allow this business to 
continue growing profitably.
In Assurance Testing, revenues grew by 121% and 
profitability by 127% as the benefits of the acquisitions 
start to be realised. The acquisition of the Secure Test 
business helped our Penetration and Security Testing 
revenues to grow by 139%. Even without the inclusion 
of this acquisition, revenues grew by over 37%, despite  
foregoing over £0.8m of Specialist Testing revenues as we 
withdrew from that area at the start of this financial year.  
Site Confidence’s Performance and Load Testing offerings 
saw 226% growth in sales as full year revenues exceeded 
£5.1m and the business delivered a very successful first 
twelve months of our ownership. 
Consultancy had a particularly strong second half to the 
year and improved revenues by 7% year on year despite 
being 5% behind last year’s revenues at H1. The benefits of 
being a key provider in the Information Security Standards 
area are now starting to be realised. We continue to provide 
IT consultancy to our client base but have now moved firmly 
away from areas of discretionary expenditure and from our 
historic reliance on the public and local authority sectors of 
the market. Profits improved 1% to over £0.7m (2007: £0.7m) 
as a consequence of our caution in recruitment and our use 
of high quality associate resources, until we are sure that the 
revenue streams are sustainable long term.
CHAIRMAN’S REPORT
NCC Group annual report and accounts 2008 _5 _5
corporate governance
NCC Group believes in the highest standards of corporate 
governance and investor relations. We have always 
maintained that for a business such as ours, which acts as 
an independent trusted advisor to its clients, the highest 
standards of corporate governance and application of the 
most prudent accounting standards are essential. 
Our move to the Official List, where compliance and 
adherence to these levels of corporate governance are 
better recognised, has been welcomed by our investors, 
customers and employees alike. We will continue to take 
every practical step to adhere to the revised Combined 
Code, with which we comply fully, and will continue using 
FTSE 250 companies as our benchmark. 
STRONG
AT 30%
OPERATING PROFIT MARGIN
People
NCC Group remains totally committed to its workforce as 
people are the reason for the Group’s continued success. It 
is worth pointing out that the commitment shown from the 
newly acquired businesses has matched that of our existing 
employees and has at times exceeded it.
We believe that our approach to total employee 
remuneration and work-life balance is well judged and is 
essential to ensure staff retention. We believe that our all 
round packages place us in the top quartile of remuneration 
in the locations from which we operate. Our objective is to 
continue with this approach. 
The Group’s Board was unchanged although I would like to 
welcome Ken Munro as a director on the Operational Board. 
He has taken responsibility for Sales within our enlarged 
Penetration and Security Testing division, which is branded 
NCC Group Secure Test. Again this reflects our objective 
of recruiting and promoting the best senior managers to 
continue to strengthen the management team to meet 
the Group’s growth ambitions. In December 2007 Jane Pink, 
who had been an Operational Director in Assurance Testing, 
retired after 21 years of service.
It is with sadness that we learnt that Bill Kirkwood, one of 
the founders of Site Confidence, died after a lengthy and 
courageous battle against cancer.
Recycled paper 6_
Dividends
The Board is recommending a final dividend of 4.75p per 
share which makes a total of 7.00p for the year up 47% (2007: 
4.75p). If approved at the Annual General Meeting, the 
dividend will be paid on 26 September 2008 to shareholders 
on the register at 29 August 2008. The ex-dividend date will 
be 27 August 2008.
outlook
We believe that our strategy of measured acquisitions, allied 
to strong organic growth will allow the Group to continue with 
our ambitious and exciting growth plans despite the widely 
acknowledged deteriorating economic environment. 
The Group’s target remains to be the most significant player 
in each of the market niches in which we operate and to 
constantly evolve what we offer. The launch of our 24/7 
Assured security monitoring proposition is a prime example 
of this and it will be a key product for us in the medium term. 
It also fits with our strategy of delivering products and services 
that are not discretionary. 
 
The start to the year sees our Group Escrow Solutions 
renewals at £13.8m, up from £10.5m this time last year, 
and a verification order book of £1.6m which is over £2m 
worldwide. The Assurance Testing businesses’ order books 
have improved to £4.6m from £2.2m in 2007 and have 
£3.9m of monitoring renewals forecast for 2008/09. The 
Consultancy business has £2.5m of orders up from £1.8m 
last year. 
We remain committed to the delivery of organic growth in 
all of our businesses worldwide as well as the newly acquired 
operations. The outlook for NCC Group remains good and 
we remain very confident in our ability to deliver good levels 
of sustainable growth.
(continued)
CHAIRMAN’S REPORT
We RemAIn commItteD 
to tHe DeLIVeRy oF 
oRGAnIc GRoWtH In 
ALL oF oUR bUsInesses 
WoRLDWIDe
NCC Group annual report and accounts 2008 _7
Paul mitchell
Non Executive Chairman
NCC Group plc
2 July 2008
_7
Recycled paper 8_
cHIeF execUtIVe’s ReVIeW
8_ NCC Group annual report and accounts 2008
30% GROWTH
IN ADJUSTED OPERATING PROFITS
overview
For the fourth successive year as a listed company we 
produced a record performance, delivering for the year 
ended 31 May 2008 a 41% growth in revenues that translated 
through to a 30% growth in adjusted operating profits.
Overall, the Group delivered £35.7m of revenue, up from 
£25.4m in 2007 and adjusted operating profits of £10.7m 
up from £8.2m in 2007. After £0.2m of one off exceptional 
reorganisation charges as a result of the acquisition of Escrow 
Europe, the adjusted Group operating profits were £10.5m. 
Despite the strong results this year, the last twelve months 
have been tough. Aside from the increasing uncertainty 
caused by the impact of the credit crunch and the global 
economic downturn that has blighted business worldwide, 
we moved our share listing to the Official List in July 2007, 
and completed the acquisition of, and fully integrated, two 
complementary businesses. 
The Group continues to demonstrate that our strategy of 
focused sustainable organic growth, allied to carefully 
targeted acquisitions is highly successful as confirmed by 
our enviable track record as a listed company over the last 
four years.
current markets
Since flotation we have positioned the Group to avoid 
the vagaries of the domestic economy as now most of 
our products and services fall into the non discretionary 
expenditure category. Whilst no business can be completely 
immune from economic cycles, the Board is confident 
that the Group is as well insulated as it can be against any 
economic downturn. 
Examples of how our activities occupy areas of IT expenditure 
where curtailment would be extremely difficult include:
n
  organisations who understand the need for protection of 
their business critical applications as corporate failures and 
product withdrawals increase; 
 
n
  systems, networks and data security have not kept pace 
with the growth of data and of identity theft and hacking, 
which continue to reach new levels on an almost daily 
basis; and
n
  web site performance is critical to all types of businesses 
as the web is now often their primary shop window on the 
commercial world.  
Furthermore, we have carefully and significantly reduced 
our reliance on public sector contracts.
NCC Group is now the largest provider of Escrow services in 
the world. Further, we are the only provider who mandates 
quality ahead of price. We expect that with the continuing 
economic pressure, low cost, low value propositions will 
prove to be false economy. This applies as much in the 
US where the lack of even basic testing compromises the 
solution sold by most of our competitors.
There is little doubt that the underlying economics of the IT 
software and services markets are poor, but for us this current 
adversity is beneficial as escrow decisions are not delayed. 
They are seen as critical by well managed corporate users 
who are determined to mitigate risk effectively.   _9
Recycled paper
Since we last reported we have not seen a large software 
owner going out of business. However, given the current 
economic cycle, as history has repeatedly shown, this is 
now a distinct possibility. We have consistently worked with 
software owners to put together pro-active escrow solutions 
and are now beginning to see some real benefits as this 
offers a very positive commitment from the owners to both 
their existing and prospective clients.  
Our approach has been extended to adapting the less valued 
two party escrow model, as employed by our competitors, 
and developing it so that it is truly beneficial for both parties. 
Traditionally two party agreement cover was low cost and low 
value as none of the beneficiaries knew if they were covered 
or not. The NCC Group version of this agreement provides 
a certificate of cover so the beneficiary knows exactly 
when cover is being provided, and more importantly when 
it is not. Respected owners are being proactive towards 
this proposition and we expect the take up by owners to 
continue to grow. 
 
Within Assurance Testing, the market for Secure Test, our 
penetration and security testing service, continues to see strong 
growth as the headlines are dominated by easily avoidable 
examples of weak security that have resulted in real data 
and financial loss. Over the last 12 months the constant 
stream of media coverage of repeated and significant failures 
of Government departments to keep data and laptops 
safe and secure has been our best marketing campaign. 
These constant embarrassing failures highlight the potential 
for a substantial growth in the demand for our testing services 
as well as our Information Security Consultancy services. In 
addition to human error, the criminal world continues to use 
hacking as a prime method of fraud. It is a big and lucrative 
business, as demonstrated by the recent hacking into the 
Cotton Traders website. 
The Secure Test business continues to be the largest team of 
CESG CHECK accredited ethical security testers in the UK with 
currently over 44 testers.  However, we are seeking greater 
strength and capacity to deliver the more significant contracts 
for CESG, the information assurance arm of the UK 
Government Communications Headquarters, as well as to 
public and private organisations, all of whom require NCC 
Group services.
Site Confidence continues to offer a highly valued alternative 
to the entry level unsophisticated web and monitoring 
services available in the market and is suitably adaptable, 
flexible and user friendly to offer a real alternative to the 
more expensive and complex network test tools. This and our 
dedicated account management approach will continue 
to ensure our ongoing success in the market place.
The security side of our Consultancy division complements 
our Secure Test propositions. We offer advice to organisations 
to ensure that they are best placed to protect themselves 
and their business assets from attack. NCC Group provides 
information security advice from every perspective, 
especially for those organisations that are covered by the 
PCI Data Security Standards. Our position in the information 
security market is further enhanced by our being accredited 
PCI Auditors, having CLAS consultants and the biggest CHECK 
Test teams in the UK. As the new financial year progresses 
this area will become an even more significant part of our 
Consultancy division’s offering.
business performance
We continue to manage the Group through three distinct 
business units, Escrow Solutions, Assurance Testing and 
Consultancy. Each is independent and run by an autonomous 
management team responsible for setting and, after Board 
approval, delivering its own plans, with each area being 
tasked with generating organic growth.
Group escrow solutions
The Group Escrow Solutions business remains the cornerstone 
of the Group representing 50% of our revenue. We have 
experienced good growth in all our key performance 
measures of profitability, new contracts, beneficiaries, 
renewals and Verification Testing.
Group Escrow Solutions profitability grew to £10.2m (2007: 
£8.0m), an increase of 28%, on revenue of £18.0m, with the 
UK contributing £15.7m.
Escrow renewals for the Group represented £11.2m (2007: 
£9.4m) in the year, benefiting from continued tight controls 
over the termination process. Contract terminations were 
less than 10% in the year and below 11% for agreement 
beneficiaries.
 
Worldwide the beneficiary base has now grown to 25,193. 
There are 15,102 (2007: 13,521) beneficiaries to 8,124 (2007: 
7,440) agreements in the UK and we have 844 minimum 
annual fees on agreements.
The rate of agreement completions, renewals and 
terminations has been such that we are forecasting Group 
escrow renewals to be £13.8m for 2008/09 with UK renewals 
forecast to be £11.2m.
Escrow Verification Testing remains a predominantly UK sale, 
although we are seeing very good progress within the US 
and European marketplaces, with customers beginning to 
understand the benefits of increased levels of protection. 
The Escrow UK Verification Testing service delivered £3.0m 
of revenue (2007: £2.4m). We continue to see over 40% 
of verifications being repeated and have an order book 
of £1.6m, with a further £0.5m of verifications in the other 
Escrow businesses. 10_
Assurance testing
Assurance Testing consists of two components, Secure Test 
and Site Confidence. Assurance Testing revenue grew 121% 
to £12.8m with an increase in profitability of 127% to £1.7m 
(2007: £0.7m). 
Secure Test includes the remainder of our Specialist Testing 
activities and despite moving out of this area at the start of 
the financial year and foregoing £0.8m of revenues, growth 
was still up 139% to £7.7m in 2008 from £3.1m in 2007 
or 37% excluding the acquisition. As risk mitigation moves 
further up the corporate agenda, regardless of budget, we 
see significant growth in this area.  
The Site Confidence operation encompasses our web site 
monitoring and load testing business and saw revenues 
increase to £5.1m (2007: £1.6m) in our first full twelve months 
of ownership. It offers an excellent opportunity across the 
Group as it fits with all parts of our Assurance Testing offerings 
and forms part of the framework of our 24/7 Assured security 
monitoring proposition. The online monitoring business offers 
a high level of recurring revenues, comprising of at least 
90% of our blue chip customers continuing to renew their 
annual contracts.
consultancy
Consultancy revenues grew by 7% to £4.9m (2007: £4.6m) 
as we continued to grow our presence in the Information 
Security marketplace. Once again this division had a strong 
second half, with revenues up 18% to £2.8m (2007: £2.3m) 
for H2 and with it we saw a return to our anticipated utilisation 
levels of c.75%.
As a result of the growth in revenues, we generated profits 
of £0.6m in H2. However, we remained cautious in our 
recruitment so did not take full advantage of the margin 
opportunities as we relied on high quality trusted associates 
rather than increasing the headcount. Operating profits for 
the year were unchanged at £0.7m (2007: £0.7m).
Investment and product development
We have for a long time held the belief that a managed 
security offering in the market is long overdue. To date, no 
organisation has been able to provide an effective combination 
of web monitoring to cover capacity and performance with 
security assurance to ensure vulnerabilities are not appearing in 
monitored corporate and internet applications. 
Penetration and Security Testing provides a degree of comfort 
that a network is safe. However, this needs to be carried out 
on a regular, minute by minute basis if total assurance is to 
be achieved.  
Our new service offering, 24/7 Assured, helps businesses get 
closer to that peace of mind and repel the threat of organised 
crime and opportunist hackers. As more and more money is 
lost to fraud and it becomes more widely reported, business 
and importantly the major retailers, are fast beginning to 
accept the threat as very real. The Group see 24/7 Assured 
as offering companies genuine protection.
Our investment in this area of £1m to £1.5m over the next 
12 months will be on developing new tools for the new 
product as well as on updating our current monitoring and 
performance solutions.  The Group will not only benefit from 
monitoring revenues and the new product set revenues 
but will also become more embedded in customers’ web 
work streams.
Acquisitions
We successfully completed two acquisitions in the financial 
year and through our integration team have carefully 
brought them in to the Group. We are already maximising 
the benefits and returns from the increased scale, territory 
and customer opportunities they bring. 
We will continue to invest in appropriate complementary 
businesses by way of company or asset based acquisitions. 
We are regularly involved in discussions with suitable  
target companies but will always remain cautious, as 
the integration and extraction of enhanced value is of 
paramount importance to the Group. 
employees, recruitment and retention
Recruitment and retention remains the biggest challenge to 
growth for a people business such as ours. The last 12 months 
has seen a good intake of new testers and technical staff in 
the Assurance Division, as well as some excellent well qualified 
Information Security consultants. The Escrow Solutions UK  
sales teams have gone through a period of change with 
a refreshing of the teams as practices and processes 
change.
As a Group we are committed to employing the best people 
in the market wherever possible. We have a headcount of 
334 employees worldwide.
the way forward
We continue to make a virtue of acting independently and 
operating as trusted, equitable advisors. To date we have 
successfully acquired and integrated five businesses that 
have complemented our service and delivery offerings. 
Combining that with our outstanding track record of organic 
growth, we have a sound business model that we will 
continue to evolve and develop to grow the Group further. 
cHIeF execUtIVe’s ReVIeW
(continued)
NCC Group annual report and accounts 2008 _11
Rob cotton
Chief Executive
NCC Group plc
2 July 2008
As A GRoUP We ARe 
commItteD to 
emPL oyInG tHe best 
PeoPLe In tHe mARKet 
WHeReVeR PossIbLe
Recycled paper 12_
Revenue analysis
Group revenues for the year ended 31 May 2008 increased by 41% to £35.7m (2007: 
£25.4m). Supported by the acquisitions of Secure Test and Escrow Europe in August 2007 and 
January 2008 respectively, the Group’s half year split saw 46% of revenue delivered in the first 
half (2007: 45%) and 54% in the second half (2007: 55%). Excluding acquisitions made in this 
financial year, Group revenue grew by 25%.
Group Escrow Solutions accounted for 50% of Group revenue (2007: 59%) including five 
months of revenue from Escrow Europe. Assurance Testing now accounts for 36% (2007: 
23%) with Consultancy, the smallest division, accounting for 14% of revenue (2007: 18%). 
The change reflects the increased size of the Assurance Division due to its strong organic 
growth and acquisitions.
The geographic split of revenue has continued to evolve with the acquisition of Escrow 
Europe, the continued growth in the US Escrow Solutions business and further penetration into 
continental Europe from the UK. However, the vast majority of the revenue is still contributed 
by the UK at £29.2m (2007: £20.6m) or 82% (2007: 81%) of total revenues. Revenue from the 
rest of the world has increased 24% to £3.8m (2007: £3.0m) with Europe contributing £2.7m 
(2007: £1.8m).
Group Escrow Solutions revenue for the year increased by 20% to £18.0m (2007: £15.0m) 
driven by continued growth in the UK which increased its revenue by 14% to £15.7m (2007: 
£13.8m). The US increased its revenue by 16% to £1.2m (2007: £1.0m) and Escrow Verification 
Testing contributed a 26% increase in revenues. 
Escrow Solutions contract terminations remain constant at approximately 10% with annual 
renewals increasing by 19% to £11.2m (2007: £9.4m). Excluding the acquisition of Escrow 
Europe, Group Escrow Solutions grew by 14%. 
Our Assurance Testing division delivered strong revenue growth of 121% to £12.8m (2007: 
£5.8m) and was up by 67% excluding the impact of two acquisitions made in this financial 
year. The continued demand for Penetration and Security Testing has seen its revenue increase 
by 139%. The Performance and Load Testing business of Site Confidence contributed £5.1m 
of revenue which showed an annualised growth rate of 24%.
Consultancy revenues grew by 7% to £4.9m (2007: £4.6m) with, as expected, a stronger 
second half of the year.
Profitability
Adjusted Group operating profit, as set out in the table below, grew by 30% to £10.7m (2007: 
£8.2m). Adjusted operating margins were slightly lower at 30% (2007: 32%) reflecting the 
inclusion of lower margin acquisitions but an increase from 29% at the time of the interim 
results. The adjusted operating profit includes £0.9m (2007: £0.6m) of share based charges 
and related costs. Excluding the share based charges adjusted operating profits grew by 32%.
In July 2007 the Group moved to the Official List and incurred one off costs of £531,000 in 
completing the process. The acquisition of Escrow Europe in January 2008 brought unforeseen 
legal and financial complexity, which with onerous legal and employment contracts to 
reorganise, cost the Group a one off charge of over £180,000. These costs are directly as a 
result of the transaction, are one off, non-trading and exceptional.
The half year split of adjusted operating profits was H1 44%: H2 56% (2007: H1 40%: H2 60%)  
as expected. 
 
 
 2008 2007
 £000 £000
  
Reported operating profit 9,217 7,952
Amortisation of acquired intangibles 740 230
Exceptional items 711 -
Adjusted operating profit 10,668 8,182
  
  
 
  
 2008 2007
 £000 £000
  
Reported profit before tax 8,693 7,785
Amortisation of acquired intangibles 740 230
Exceptional items 711 -
Unwind of the discount on deferred consideration 333 102
Adjusted profit before tax 10,477 8,117
FINANCIAL REVIEW
oPeRAtInG PRoFIt
PRoFIt beFoRe t Ax
NCC Group annual report and accounts 2008 _13
Group Escrow Solutions operating profit for the year ended 31 May 2008 increased 28% to 
£10.2m (2007: £8.0m). Escrow Solutions UK contributed £9.4m, an increase of 15%, while 
Escrow Solutions US contributed £0.4m, an increase of 59%. Escrow Solutions Germany broke 
even following last year’s loss of £0.5m, with Escrow Europe contributing £0.4m in its first five 
months of ownership. In future the Group will report both the German operations’ operating 
profits within Escrow Europe, although revenues will be separated out.
Escrow Solutions operating margins remained strong as a consequence of focused control 
over contract terminations and continued scope for price increases on the back of adding 
value to the Escrow proposition. Group Escrow Solutions operating margin increased to 56% 
(2007: 53%), Escrow Solutions UK increased its margins to 60% (2007: 59%).
The continued increase in demand for Penetration and Security Testing and Performance and 
Load Testing contributed to an Assurance Testing operating profit increase of 127% to £1.7m 
(2007: £0.7m). The acquisition of Secure Test, a Penetration and Security Testing business, in 
August 2007 contributed £0.3m in ten months.
The margin in Assurance Testing remained consistent at 13% (2007: 13%) even after significant 
investment in the management structure in the businesses. 
Consultancy continued the trend of prior years, delivering a stronger second half year and 
maintained its contribution to operating profit at £0.7m (2007: £0.7m) with a margin of 15% 
(2007:16%).
Currency fluctuations were minimal with a £15,000 adverse impact on the Group’s profits in 
the financial year ended 31 May 2008.
Pre-tax profit
Adjusted pre-tax profit increased 29% to £10.5m (2007: £8.1m). The Group’s reported pre-
tax profit was up 12% to £8.7m (2007: £7.8m) after the inclusion of the one off exceptional 
charges, non cash amortisation of intangible assets and the unwinding of the discount on the 
acquisitions deferred consideration. 
taxation
The Group’s effective tax rate is 26.9% (2007: 31.0%). 
The effective rate is below the standard UK rate of 30% (28% from 6 April 2008) largely due to 
the positive impact of the tax allowance on exercise of share options granted in 2004. 
Throughout the option vesting period, the difference between the deferred tax asset, based 
on the closing actual value of the share price and 30% of the fair value of the option schemes 
had been recognised in equity. Following the exercise of the options the full benefit of the 
tax deduction is realised and the difference between the accounting and tax treatment 
becomes permanent, the resulting credit has been recognised in the income statement.
The effective rate is adversely affected by the unwinding of the discount on the retention 
payment for Site Confidence, Secure Test and Escrow Europe.
 
_13
Recycled paper 14_
earnings per share
The adjusted fully diluted earnings per share increased 33% to 22.4p (2007: 16.8p). The basic 
earnings per share increased 15% to 18.9p (2007: 16.5p), whilst fully diluted earnings per 
share increased 15% to 18.3p (2007: 15.9p). Growth in basic earnings per share is different 
from the growth in profits in the year, due to the fact that the weighted average number of 
shares has increased.
 
The table below analyses the effect on Group’s fully diluted earnings per share of the 
amortisation of acquired intangibles, unwind of the discount on the deferred consideration for 
acquisitions and the effect of the exceptional costs.
 2008 2007
 Pence Pence 
  
Diluted ePs as per the income statement 18.3 15.9
Amortisation of acquired intangibles 1.6 0.6
Unwind of the discount on the deferred  
consideration of the acquisitions 1.0 0.3
Exceptional item after tax 1.5 -
Adjusted diluted ePs 22.4 16.8
Dividends
In line with the continuing progressive dividend policy, the Board is recommending a final 
dividend of 4.75p per ordinary share, making the total 7.00p for the year. This represents cover 
of 2.7 times (2007: 3.5 times) based on basic earnings. 
Shareholders’ funds at the end of the year were £39.5m (2007: £33.4m).
cash
The Group continues to be highly cash generative with operating cash flow before interest 
and tax of £11.2m (2007: £7.8m) which is 122% of operating profit before interest and tax 
(2007: 98%).
After accounting for net cash out flows of £10.4m for acquisitions made during this year, the 
Group ended the year with net debt of £3.4m (2007: net cash £0.9m). 
Capital expenditure increased to £1.5m (2007: £0.7m). It will increase in the coming financial 
year as the Group upgrades its core IT systems to meet the demands of a larger global 
business and with the continuing need to bring facilities up to the standard appropriate for our 
employees and customers.
balance sheet
Following the acquisitions of Secure Test and Escrow Europe goodwill increased by £8.8m and 
intangible assets relating to customer contracts and associated relationships increased by 
£4.5m. The value of goodwill has been assessed and no impairment has been evidenced. 
The contracts and customer relationships have been assigned a useful economic life of 
between 5 and 20 years and are to be amortised over that period.
Paul edwards
Finance Director
NCC Group plc
2 July 2008
FINANCIAL REVIEW
(continued)
NCC Group annual report and accounts 2008 _15
Recycled paper
£39.5m
sHAReHoLDeRs’ FUnDs 
At tHe enD oF tHe yeAR 
WeRe 16_
AND SENIOR MANAGEMENT
DIRECTORS
Paul mitchell
non executive chairman
Paul Mitchell was appointed Non Executive Chairman of NCC Group in 1999. He is Managing 
Director of Rickitt Mitchell & Partners Limited, a corporate financial advisory firm based in 
Manchester. He is also a non executive director of Styles & Wood Group plc and Chairman of 
Hollins Murray Group Limited, a property investment company.
He is a qualified chartered accountant.
Rob cotton
chief executive
Rob Cotton has been Chief Executive since 2003, having joined the Group as Finance Director 
and Managing Director of Escrow in 2000. He steered the Group through its move to the 
London Stock Exchange’s main market in July 2007 following admission to AIM in July 2004, 
and through a management buy-out in April 2003. As well as delivering consistent organic 
growth in revenue and profits, he has instigated and overseen a series of strategic expansion 
plans including the acquisition of complementary businesses worldwide.
A qualified chartered accountant, he previously held a number of director and senior 
management positions in industry.
NCC Group annual report and accounts 2008 _17
Paul edwards
Finance Director
Paul Edwards was appointed Finance Director in April 2003, 
having joined NCC Group in 2000 as Group Financial 
Controller. He played a key role in the Company’s flotation 
on AIM in July 2004 and its move to the London Stock 
Exchange’s main market in July 2007.
He is a qualified chartered management accountant and 
holds an MBA from Manchester Business School.
James Wallace
senior non executive Director
James Wallace joined NCC Group in June 2004 as a non 
executive director. He is a qualified chartered accountant 
and recently retired as Chairman of Bodycote plc. He is 
Chairman of Scapa Group plc and a non executive director 
of Holidaybreak plc and Manchester Airport Group plc.
eurfyl ap Gwilym
non executive Director
Eurfyl ap Gwilym joined NCC Group in June 2004 as a non 
executive director. He has worked at board level for many 
years in an executive capacity and is a non executive director 
of Pure Wafer plc and the Principality Building Society.
Recycled paper 18_
AND SENIOR MANAGEMENT
DIRECTORS
(continued)
Felicity brandwood 
Group Company Secretary  
and Operational Director, 
Escrow Solutions
Felicity Brandwood, a qualified 
solicitor, was appointed a 
Director of Escrow Solutions in 
2006 alongside her role as Group 
Company Secretary, having joined 
the Group in 1984. Along with  
day-to-day responsibility for the 
operational management of the 
Group’s Escrow Solutions division, 
she is responsible for the overall 
operation of the US business and 
implementation of the Group’s US 
expansion plans.
Jon Leigh
Operational Director, 
Escrow Solutions
Jon Leigh has been Director of 
Escrow Solutions since 2003. He 
is responsible for the product 
development and sales strategies 
of the Group’s Escrow Solutions 
division and the development of 
the Group’s European business, 
including integration of the recent 
acquisition of Escrow Europe. With 
a background in testing, he has 
worked for NCC Group for over 20 
years and previously held a variety 
of management roles.
Andy Hague
Operational Director - Technical,
Penetration and Security Testing  
Andy Hague joined NCC Group 
in 2006 and is responsible for the 
operational management and 
technical development of the 
Group’s security testing business 
- Secure Test. He was previously 
Managing Director at technology 
company XAL Group and has 
more than ten years technology 
and senior management 
experience.
Ken munro
Operational Director
Business Development, 
Penetration and Security Testing
Ken Munro joined NCC Group in 
2007 with the acquisition of the 
Secure Test business which he co-
founded in 2002. Ken is responsible 
for the operational management 
and business development of the 
Group’s security testing business. 
He previously held various positions 
with security experts Vigilante and 
Network Associates as well as 
the anti-virus software provider Dr 
Solomon’s, having worked in the 
field of security since 1996. 
NCC Group annual report and accounts 2008
operational board
The senior management 
team detailed below is 
responsible for the operation 
of the Group’s three divisions. 
The members of the senior 
management team include: _19
bob Dowson 
Operational Director, 
Performance and Load Testing
Bob Dowson is responsible for 
the operational management 
and development of the Group’s 
Performance and Load Testing 
business - Site Confidence. He 
joined the company in 2002 from 
Forrester Research, where he was 
Commercial Director responsible for 
account management in Europe. 
Roger Rawlinson
Operational Director,
Consultancy
Roger Rawlinson is responsible for 
the operational management of 
the Group’s consultancy business 
and the scheduling and resource 
management of the Group’s day 
rate businesses. He has worked for 
NCC Group for over ten years in a 
variety of testing and consultancy 
roles and was appointed a 
Director of Consultancy in 2004.
John Redeyoff
Group Development Director
John Redeyoff is responsible for 
the strategic development of 
new services and markets and 
delivery of new revenue streams, 
in particular our 24/7 Assured 
security and monitoring services, 
having joined NCC Group in 2003 
as a Director of the Consultancy 
division.
craig motta
General Manager, 
North America
 Craig Motta joined NCC 
Group as General Manager of  
Escrow Solutions in the US in 2006 
following the acquisition of the 
Escrow business of Recall Total 
Information Management and 
is responsible for the day to day 
management of the US business. 
He previously held several 
management positions within 
Recall, including Sales Director 
of Recall’s North American 
Document Management Business. 
niels Hagels
General Manager, Germany
Niels Hagels joined NCC Group 
in 1995 and is responsible for 
the day to day management 
of the Group’s German office. 
Prior to joining NCC Group, he 
was Commercial Director of 
Escrow Europe, having previously 
managed a number of IT and 
Internet companies.
Felicity brandwood 
Group Company Secretary  
and Operational Director, 
Escrow Solutions
Felicity Brandwood, a qualified 
solicitor, was appointed a 
Director of Escrow Solutions in 
2006 alongside her role as Group 
Company Secretary, having joined 
the Group in 1984. Along with  
day-to-day responsibility for the 
operational management of the 
Group’s Escrow Solutions division, 
she is responsible for the overall 
operation of the US business and 
implementation of the Group’s US 
expansion plans.
Jon Leigh
Operational Director, 
Escrow Solutions
Jon Leigh has been Director of 
Escrow Solutions since 2003. He 
is responsible for the product 
development and sales strategies 
of the Group’s Escrow Solutions 
division and the development of 
the Group’s European business, 
including integration of the recent 
acquisition of Escrow Europe. With 
a background in testing, he has 
worked for NCC Group for over 20 
years and previously held a variety 
of management roles.
Andy Hague
Operational Director - Technical,
Penetration and Security Testing  
Andy Hague joined NCC Group 
in 2006 and is responsible for the 
operational management and 
technical development of the 
Group’s security testing business 
- Secure Test. He was previously 
Managing Director at technology 
company XAL Group and has 
more than ten years technology 
and senior management 
experience.
Ken munro
Operational Director
Business Development, 
Penetration and Security Testing
Ken Munro joined NCC Group in 
2007 with the acquisition of the 
Secure Test business which he co-
founded in 2002. Ken is responsible 
for the operational management 
and business development of the 
Group’s security testing business. 
He previously held various positions 
with security experts Vigilante and 
Network Associates as well as 
the anti-virus software provider Dr 
Solomon’s, having worked in the 
field of security since 1996. 
Recycled paper 20_
The directors present their annual report and financial statements for the year ended 31 May 2008.
Principal activity and review of the business
The principal activity of the Group is the independent provision of IT assurance through Escrow 
Solutions, Assurance Testing and Consultancy to both the public and private sectors worldwide. 
The performance in the year and the year end financial position were satisfactory and the 
directors expect the Group to continue its growth for the foreseeable future. 
The Chairman’s report on pages 4 to 7 as well as the Chief Executive’s review on pages 8 to 
11 report on the Group’s development during the year to 31 May 2008, its position at that date 
and the Group’s likely future development. 
Any forward looking statements made in this document represent managements’ best 
judgement as to what may occur in the future. However, the Group’s actual results for the 
current and future fiscal periods and corporate developments will depend on a number of 
economic, competitive and other factors, some of which will be outside the control of the 
Group. Such factors could cause the Group’s actual results for future periods to differ materially 
from those expressed in any forward looking statements made in this document.
The financial results of the Group are shown in the income statement on page 35.
Dividends
The directors propose a final dividend of 4.75p per ordinary share which, together with 
the interim dividend of 2.25p per ordinary share paid on 29 February 2008, makes a total 
dividend of 7.00p for the year. The final dividend has not been accrued for in these financial 
statements. The final dividend will, if approved by shareholders at the Annual General Meeting 
(AGM), be paid on 26 September 2008 to shareholders on the register at the close of business 
on 29 August 2007.
The Company received dividends of £4,000,000 (2007: Nil) from subsidiary undertakings 
during the financial year.
share capital
Details of the movements of the authorised and called up share capital of the Company are 
set out in note 21 to the financial statements.
Directors and their interests
Details of the Company’s current directors are set out on pages 16 to 17. Directors’ interests  
in shares and share options in the company are detailed in the Directors’ remuneration report 
set out on pages 26 to 30.
Principal shareholders
The following have notified the Company as being interested in 3% or more of the Company’s 
issued ordinary share capital as at 30 June 2008:
 Ordinary  % of issued
 shares of 1p share capital
AXA Framlington Investment Mgmt  4,203,355 12.50
Legal & General Investment Mgmt 3,210,565 9.55
Montanaro Inv Managers 2,195,000 6.53
Standard Life Investment Mgmt 1,752,917 5.21
Rob Cotton 1,557,169 4.63
Morgan Stanley Securities 1,509,875 4.49
HSBC Securities 1,492,650 4.44
JP Morgan Asset Mgmt 1,397,713 4.16
Hansa Capital Ltd 1,250,000 3.72    
Baillie Gifford & Co 1,011,070 3.01
DIRECTORS’ REPORT
NCC Group annual report and accounts 2008 _21
corporate social responsibility
The corporate social responsibility section on pages 32 to 33 provides an update on the 
Group’s policies and activities in respect of its wider stakeholders - employees, clients, suppliers 
and the community – and environmental, ethical and health and safety issues.
Principal risks and uncertainties
The principal financial risks and uncertainties the Group faces are described in note 19 to the 
annual report and accounts. 
The Group faces operational risks and uncertainties which the directors take all reasonable 
steps possible to mitigate however the directors recognise that they can never be eliminated 
completely. 
The principal operational risks and uncertainties the Group faces include those in relation to 
the recruitment of additional staff to meet the Group’s ambitious growth plans, the entry of a 
significant competitor to threaten the Group’s leading position in its domestic Escrow Solutions 
market, the occurrence of unforeseen difficulties in the integration of future acquisitions the 
Group may enter into and the dependence on key executives and senior managers.
Risk and uncertainties outside the Group’s control include those relating to the implementation 
of changes in government policy for the procurement of IT Services and alterations to the 
legislative and taxation framework in which the Group operates.
Disclosure of information to auditors
The directors who held office at the date of approval of this Directors’ report confirm that so 
far as they are each aware, there is no relevant audit information of which the Company’s 
auditors are unaware; and each director has taken all the steps that they ought to have taken 
as a director to make themselves aware of any relevant audit information and to establish that 
the Company’s auditors are aware of that information.
Auditors
KPMG Audit Plc has expressed its willingness to continue in office. Therefore, in accordance 
with Section 384 of the Companies Act 1985, a resolution to reappoint KPMG Audit plc as the 
Group’s auditor and authorising the directors to fix the remuneration of the auditor will be put 
to the forthcoming Annual General Meeting.
Annual General meeting
The directors consider that the resolutions set out in the notice of Annual General Meeting 
are in the best interests of the Company and its shareholders as a whole and, accordingly, 
recommend that its shareholders vote in favour of them, as the directors intend to do in 
respect of their own beneficial shareholdings.
By order of the Board
Rob cotton
Chief Executive
NCC Group plc
2 July 2008
_21
Recycled paper 22_
NCC Group is committed and is accountable to shareholders for high standards of 
corporate governance. In respect of the year ending 31 May 2008, NCC Group has been 
in full compliance with the provisions of section 1 of the 2006 (Revised) Combined Code on 
Corporate Governance.
 
This statement describes how principles of corporate governance are applied to the Group.
the board
The Board comprises two executive and three non executive directors whose Board and 
Committee responsibilities are set out in the table below:
  board Audit Remuneration nomination
   committee committee committee
Paul  Non Executive Chairman  Member Chairman
Mitchell Chairman
Rob 
Cotton Chief Executive Member   
Paul 
Edwards Finance Director Member   
James Senior Non  Member Chairman Member Member
Wallace  Executive Director 
Eurfyl ap  Non Executive Member Member Chairman Member
Gwilym Director
The Non Executive Chairman, Paul Mitchell, is responsible for the running of the Board. 
Executive responsibility for the running of the Group’s business rests with the two executive 
directors, Rob Cotton and Paul Edwards, who are supported in this by the Operational Board 
of NCC Group UK.
 
The Board normally meets on a monthly basis. During the year, the Board met on twelve 
scheduled occasions and further meetings and conference calls were held as and when 
necessary. In addition, a one day strategy meeting took place. 
The attendance of individual directors at the scheduled Board meetings is shown in the table 
below:
  board
  meetings attended
Paul Mitchell Non Executive Chairman 12/12
Rob Cotton Chief Executive 12/12
Paul Edwards Finance Director 11/12
James Wallace Senior Non Executive Director 12/12
Eurfyl ap Gwilym Non Executive Director 11/12
 
After careful review, the Board has again concluded that James Wallace and Eurfyl ap Gwilym 
were independent throughout the year. In coming to this assessment the Board considered 
the character of the individuals concerned and the fact that none of them:
n
 has ever been an employee of the Group;
n
 has ever had a material business relationship with the Group;
n
 receives any remuneration other than their fees;
n
  has close family ties with advisors, other directors or senior management of the Group that 
could reasonably be expected to cause a conflict;
n
 has significant links with other directors through involvement with other companies;
n 
represents a significant shareholder; or
n
 has served on the NCC Group Board for more than nine years.
CORPORATE GOVERNANCE
NCC Group annual report and accounts 2008 _23
The Board is responsible to shareholders for the proper management of the Group and for 
its system of corporate governance. It receives information on (at least) a monthly basis to 
enable it to review trading performance, forecasts and strategy and it has a schedule of 
matters specifically reserved for its decision. The most significant of these are:
n
 changes to the structure, size and composition of the Board;
n
 consideration of the independence of non executive directors;
n
 review of management structure and senior management responsibilities;
n
  with the assistance of the Remuneration Committee, approval of remuneration policies  
across the Group;
n
 approval of strategic plans, profit plans and budgets and any material changes to them;
n
  oversight of the Group’s operations ensuring competent and prudent management, sound 
planning, an adequate system of internal control and adequate accounting and other 
records;
n
 final approval of annual accounts and accounting policies;
n
 approval of the dividend policy;
n
  approval of the acquisition or disposal of subsidiaries and major investments and 
capital projects;
n
  delegation of the Board’s powers and authorities, including the division of responsibilities 
between the Chairman, the Chief Executive and other executive directors; and
n
 receiving reports on the views of the Company’s shareholders.
Operational management of the Group is delegated to the operating Board of NCC Group 
and NCC Group Inc.
Procedures exist to allow the directors to seek independent legal and professional advice in 
respect of their duties at the Company’s expense where the circumstances are appropriate. 
All directors have access to the Company Secretary for advice.
All directors are required to submit themselves for re-election at regular intervals and at least every  
three years.
The following formally constituted committees deal with specific aspects of the Group’s affairs 
in accordance with their written terms of reference, which are reviewed annually. 
Audit committee
The Audit Committee, which is chaired by James Wallace, who has recent, relevant experience 
as a former Finance Director and is currently Chairman of another pIc audit committee, 
comprises the two independent Non Executive Directors and meets at least twice a year. The 
Chairman, Chief Executive, Finance Director and external auditors attend these meetings as 
required by the Committee.
The purpose of the Committee is to assist the Board in the discharge of its responsibilities for 
financial reporting and corporate control and to provide a forum for reporting by the external 
auditors. The responsibilities of the Committee include:
n
  to monitor the integrity of the financial statements and review significant financial reporting 
judgements contained in them;
n
  to review the Company’s internal financial control system and risk management systems;
n
  to make recommendations to the Board in relation to the appointment of the external auditor 
and to approve the remuneration and terms of engagement of the external auditors;
n
  to review and monitor the external auditors’ independence, objectivity and effectiveness;
n
  to develop and implement policy on the engagement of the external auditors to supply 
non-audit services;
n
  to monitor the Company’s whistle-blowing procedures; and
n
  to review regularly the need for an internal audit function.
The attendance of individual Committee members at Audit Committee meetings is shown in the  
table below:
 meetings attended
James Wallace 2/2 
Eurfyl ap Gwilym 2/2
_23
Recycled paper 24_
CORPORATE GOVERNANCE
(continued)
During the year, the Audit Committee considered the following issues:
n
  the appropriate valuation techniques to be utilised in valuing share options under IFRS;
n
  the areas of judgement in the financial statements including the valuation of intangible 
assets and goodwill impairment;
n
  the requirement for a formal internal audit function;
n
  the independence of Rickitt Mitchell as corporate finance advisors
n
  the level of fees payable to KPMG Audit plc in respect of non-audit work;
n
  the separation of the audit, non audit and tax work and appointment of the appropriate 
advisors
n
  various tax issues within the Group; and
n
  corporate governance issues.
Remuneration committee
The Remuneration Committee, which is chaired by Eurfyl ap Gwilym and comprises the 
Non Executive Directors, meets at least three times a year and additionally as required. It 
is responsible for reviewing remuneration arrangements for members of the Board and 
other senior employees of the Group and for providing general guidance on aspects of 
remuneration policy throughout the Group.
The attendance of individual Committee members at Remuneration Committee meetings is 
shown in the table below:
 meetings attended
Paul Mitchell  4/4
James Wallace 4/4 
Eurfyl ap Gwilym 4/4
The Directors’ remuneration report is set out on pages 26 to 30.
nomination committee
The Nomination Committee is chaired by Paul Mitchell and comprises the Non Executive 
Directors. The Committee is responsible for proposing candidates to the Board, having regard 
to the balance and structure of the Board. There has been one meeting in the year.
 meetings attended
Paul Mitchell  1/1 
James Wallace 1/1 
Eurfyl ap Gwilym 1/1 
Internal control
The Board is responsible for establishing and maintaining the Group’s system of internal 
control. Internal control systems are designed to meet the particular needs of the Group and 
the risks to which it is exposed. By their nature however, internal control systems are designed 
to manage rather than eliminate the risk of failure to achieve business objectives and can 
provide only reasonable and not absolute assurance against material misstatement or loss.
Key elements of the internal control system are described below. These have all been in 
place throughout the year and up to the date of this report and are reviewed regularly by 
the Board:
n
  clearly defined management structure and delegation of authority to Committees of the 
Board, subsidiary boards and associated business units;
n
  clearly documented internal procedures set out in the Group’s ISO 9001:2000 accredited  
quality manual;
n
  high recruitment standards and formal career development and training to ensure the 
integrity and competence of staff;
NCC Group annual report and accounts 2008 _25
n
  regular and comprehensive information provided to management, covering financial 
performance and key performance indicators, including non-financial measures;
n
  a detailed budgeting process where business units prepare budgets for the coming years 
and rolling three-year strategic plans, which are approved by the Board;
n
  procedures for the approval of capital expenditure and investments and acquisitions;
n
  monthly monitoring and re-forecasting of results against budget, with major variances 
followed up and management action taken where appropriate;
n
  regular internal audits of key processes and procedures under the Group’s ISO 9001 
accredited quality assurance process;
n
  ongoing procedures to identify, evaluate and manage significant risks faced by the business 
in accordance with the guidance of the Turnbull Committee on Internal Controls and 
procedures to monitor the control systems in place to reduce these risks to an acceptable 
level; and
n
  formal consideration of progress made against significant business risks at monthly operational  
board meetings.
NCC Group does not have a dedicated internal audit function, although regular internal 
audits are conducted under the Group’s ISO 9001 accredited quality assurance process and 
at the request of the Audit Committee. The Board has considered the need for an internal 
audit function and believes that current arrangements are adequate given the structure of 
the Group’s accounting function and the size of the Group.
Auditor independence
The Company operates a rigorous policy designed to ensure that the auditors’ independence 
is not compromised by their undertaking inappropriate non-audit work. All significant non-
audit work commissioned from the external auditors requires Audit Committee approval. 
The external auditors are only selected to undertake non-audit work where the nature of the 
advice makes it more timely and cost-effective to select advisors who already have a good 
understanding of the Group.
The Audit Committee has undertaken its annual review of the nature and amount of non-
audit work undertaken by the external auditors to satisfy itself that there is no effect on their 
independence.
Going concern
The directors are satisfied that the Group has adequate resources to continue in operational 
existence for the foreseeable future, a period of not less than 12 months from the date of 
this report. For this reason, they continue to adopt the going concern basis in preparing the 
financial statements.
communication with shareholders
The Company values the views of shareholders and recognises their interests in the Group’s 
strategy and performance. It holds briefings with institutional fund managers, analysts and 
other investors, including staff shareholders, primarily following the announcement of interim 
and preliminary results, as well as at other times during the year as may be appropriate. 
The Company’s programme of investor relations activities is designed to ensure that the 
investing community receives a balanced and consistent view of the Group’s performance. 
All shareholders are welcomed to the Annual General Meeting, at which the Board of Directors 
will be available to answer questions from shareholders. 
Communication is also provided through the Annual Report, the Interim Report and the investor 
relations area on the Company’s web site, www.nccgroup.com on which financial and other 
information is available and regularly updated.
The Board receives reports from the Group’s broker twice a year that communicate feedback 
from institutional shareholders, reviews analyst coverage of the Group every month and 
receives reports twice a year from its financial public relations advisors regarding the views 
of analysts.
By order of the Board
Rob cotton
Chief Executive
NCC Group plc
2 July 2008
_25
Recycled paper 26_
RemUneRA tIon RePoRt
DIRECTORS’
26_ 26_ NCC Group annual report and accounts 2008
Remuneration committee
The Remuneration Committee advises the Board and makes recommendations to it about 
all elements of the remuneration packages of the executive directors. The members of the 
Remuneration Committee during the year were Eurfyl ap Gwilym as Committee Chairman, Paul 
Mitchell and James Wallace. The Chief Executive may attend the Remuneration Committee 
by invitation and assist the Committee with its considerations. No director is involved in setting 
their own remuneration plan.
Remuneration policy
The Committee and the Board believe that in order to attract and maintain a senior 
management team of the right calibre it is necessary to provide competitive market-based 
packages which reward Group and individual performance and motivate senior executives 
to achieve stated business objectives and deliver outstanding shareholder returns. 
Remuneration packages comprise:
n
 basic salary
n
 annual performance related bonus
n
 other benefits
n
 participation in the share incentive plans
The Group introduced a number of share incentive schemes on flotation, of which all 
members of staff, including the executive directors are potential beneficiaries. These include 
an Employee Share Option Scheme, a Long Term Incentive Plan (LTIP) and a Save As You Earn 
(SAYE) scheme.
basic salary
Salaries are normally reviewed annually and any changes are effective from 1 June in 
each year. Pay reviews take into account Group and personal performance and externally 
benchmarked market data for comparable companies operating in IT services, management 
consulting and relevant high-tech sectors. 
The salaries of Rob Cotton and Paul Edwards for the last two financial years are set out in the 
table on page 28.
A benchmarking exercise was undertaken in April 2008 to provide the Remuneration 
Committee with relevant comparable data which identified that the existing salaries of the 
executive directors were in line with marketplace comparators. 
In addition, the Committee considered the excellent performance of the Group over the last 
two years and its increasing size and complexity and the specific experience of the executive 
directors which is critical to the Group’s continued success when agreeing salaries for the year 
commencing 1 June 2008. With effect from 1 June 2008, Rob Cotton’s salary is £350,000, an 
increase of 16.7% and Paul Edwards’ salary is £180,000, an increase of 16.1%.
Performance related bonuses
The performance related pay scheme for executive directors is in line with the scheme 
covering other senior members of staff. Payments under the scheme are based upon the 
achievement of profit targets for the Group as set by the Remuneration Committee.
Pensions
The executive directors are entitled to a company pension contribution of 9% of basic salary, 
providing they make a contribution of not less than 5%, which is paid into the Group defined 
contribution pension scheme, which is also open to all of its permanent employees.
benefits
Benefits in kind include the provision of a car or car allowance, payment of private fuel, car 
insurance, private medical insurance, life assurance and permanent health insurance.
share incentives
The Group’s policy is to award share incentives to executive directors in order to align their 
interests with those of the Company’s shareholders. Both the executive directors are precluded 
from joining the Employee Share Option scheme, but have participated in the LTIP scheme 
during the financial year.
  _27
The Remuneration Committee agreed, in 2006, to extend participation in the LTIP to other 
senior executives within the Group. The maximum award is equal to one times the director’s or 
senior executive’s annual basic salary in the year ended.
 
There are two LTIP schemes in place. From 1 June 2007 the Group’s LTIP schemes are based on 
the earnings per share (EPS) performance of the Group over the performance period of three 
years alone. The previous schemes approved in 2005 and 2006, are based on performance 
targets that relate to both the total shareholder returns (TSR) and earnings per share (EPS) 
performance of the Group over the performance period.
For the 2005 and 2006 schemes, the EPS and TSR conditions will govern the vesting of up 
to 50% of each of the LTIP awards. The EPS measure will relate to the growth in the Group’s 
EPS performance over the performance period and TSR measure will compare the Group’s 
TSR performance over the performance period with the TSR performance of the constituent 
companies of the FTSE software and computer services index over the performance period. 
The performance period is three years.
For both schemes, if growth is equal to 25% or more per annum then 100% of the award 
governed by the EPS condition will vest. If, however, growth is less than 10% per annum, none 
of the award governed by the EPS condition will vest. Between these two points, vesting will be 
determined on a straight line basis. The Remuneration Committee believes that this is a more 
appropriate measure of the Company’s performance given its current position and it aligns 
the interests of the key executives and directors with those of the shareholders.
The TSR condition will govern the vesting of 50% of the LTIP award and will compare the 
Group’s TSR performance over the three year performance period with the TSR performance 
of the constituent companies of the FTSE software and computer services index. Where the 
Company’s TSR performance equates to median level in the comparator group, 30% of 
the award governed by the TSR condition will vest. 100% of the award governed by the TSR 
condition will vest for upper quartile performance or above. Between these two points, vesting 
will be determined on a straight line basis.
Rob Cotton joined the SAYE Scheme at the time of flotation and has continued to subscribe 
to the scheme. Paul Edwards joined the SAYE scheme on 1 September 2005 and continues 
to subscribe to the scheme. 
Performance graph
The following graph shows the total shareholder return, with dividends reinvested, from 12 July 
2004, the date of the Company’s flotation on the London Stock Exchange (AIM) against the 
corresponding change in a hypothetical holding in shares in both the FTSE All Share Index and 
the FTSE Software and Computer Services Index.
The FTSE All Share and FTSE Software and Computer Services indices both represent broad 
equity indices in which the Company is a constituent member. Inclusion of the FTSE All Share 
Index gives a market capitalisation-based perspective, whilst the FTSE Software and Computer 
Services Index gives an industry sector perspective. 
The share price of the Company at 12 July 2004, being the date of the Company’s flotation, 
was 170p and at 31 May 2008 was 385p.
 
Recycled paper
 28_
service contracts
The service contracts and letters of appointment of the directors include the following terms:
 Date of contract notice period Period of
   appointment
executive   
Rob Cotton 12 July 2005 1 year -
Paul Edwards 12 July 2005 6 months -
non executive   
Paul Mitchell 26 June 2007 3 months 3 years
James Wallace 26 June 2007 3 months 3 years
Eurfyl ap Gwilym 26 June 2007 3 months -
   
The executive directors are subject to rolling contracts and offer themselves for re-election  
by rotation in accordance with the Company’s Articles of Association. These contracts  
maybe terminated by either the Company or the relevant executive director giving the 
appropriate notice. 
Payments on termination for executive directors are restricted to the value of salary and 
contractual benefits for the notice period. There are no predetermined special provisions for 
executive directors with regard to compensation in the event of loss of office.
Directors’ interest in shares
Directors had the following beneficial interest in the issued share capital of the Company.
 ordinary shares ordinary shares
 of 1p each 2008  of 1p each 2007
executive  
Rob Cotton 1,557,169 1,879,003
Paul Edwards 248,316 276,645
non executive  
Paul Mitchell 196,600 228,100
James Wallace 14,705 14,705
Eurfyl ap Gwilym 14,705 14,705
The auditors have audited the information in the following tables: 
Remuneration
The remuneration of the directors for the year ended 31 May 2007 was as follows:
year ended 31 may 2007 salary bonus Pension benefits Fees total
 £000 £000 £000 £000 £000 £000
executive       
Rob Cotton 250 29 18 31 - 328
Paul Edwards 123 14 9 24 - 170
non executive      
Paul Mitchell - - - - 45 45
James Wallace 40 - - - - 40
Eurfyl ap Gwilym 30 - - - - 30
 443 43 27 55 45 613
The remuneration of the directors for the year ended 31 May 2008 was as follows:
year ended 31 may 2008 salary bonus Pension benefits Fees total
 £000 £000 £000 £000 £000 £000
executive       
Rob Cotton 300 109 21 30 - 460
Paul Edwards 155 44 11 31 - 241
non executive      
Paul Mitchell - - - - 58 58
James Wallace 45 - - - - 45
Eurfyl ap Gwilym 34 - - - - 34
 534 153 32 61 58 838
RemUneRA tIon RePoRt
DIRECTORS’
28_
(continued)
NCC Group annual report and accounts 2008 _29
Directors’ share options
The Group has a number of share option schemes whereby directors and staff are able to subscribe for ordinary shares in the Company. 
As at 31 May 2008 the directors held options over ordinary shares as follows. There have been no changes between the end of the financial year and the date of this report.
  Market Options options
  value at held at held at   earliest
 Date of date of 1 June 31 may exercise Performance exercise expiry
 grant grant 2007 2008 price conditions date date       
Rob Cotton** 14/07/04 £1.70 117,647 nil nil* 1 01/06/07 13/07/08
Rob Cotton*** 05/08/04 £1.70 6,909 nil £1.36 2 01/09/07 28/02/08
Rob Cotton 21/09/05 £2.36 78,431 78,431 nil* 3 01/06/08 20/09/09
Rob Cotton 19/07/06 £2.70 nil 83,333 nil* 3 01/06/09 18/06/10
Rob Cotton 13/08/07 £3.74 nil 2,914 £3.24 6 01/10/10 31/03/11
Rob Cotton 19/10/07 £3.72 nil 80,645 nil* 5 01/06/10 01/06/11
Paul Edwards** 14/07/04 £1.70 51,471 nil nil* 1 01/06/07 13/07/08
Paul Edwards 19/08/05 £2.58 4,577 4,577 £2.06 4 01/09/08 28/02/09
Paul Edwards 21/09/05 £2.36 34,313 34,313 nil* 3 01/06/08 20/09/09
Paul Edwards 19/07/06 £2.70 nil 38,888 nil* 3 01/06/09 18/06/10
Paul Edwards 19/10/07 £3.72 nil 41,666 nil* 5 01/06/10 01/06/11
* Exercise price of £1 on each occasion
**  On 30 July 2007 Rob Cotton exercised 102,839 shares, 14,808 shares were forfeited. Paul Edwards exercised 44,992 shares, 6,479 shares were forfeited.  
The  market price of the company’s shares on this date was £3.71.
*** On 30 August 2007 Rob Cotton exercised 6,909 shares, the market price of the company’s shares on this date was £3.60.
Recycled paper 30_
Performance conditions and notes
1.  The awards will vest in full if average growth of EBITA, over the three years from grant equals 
or exceeds 25% per annum. If EBITA over the three year period falls below 10% then the 
awards vested will be nil. If EBITA over the three years falls between 10% and 25% then 
the amount of awards granted will be calculated on a straight line basis between the two 
percentages.
2.  The SAYE scheme is subject to a three year savings contract. If this is completed a maximum 
of 6,909 shares will be granted.
3.  The awards will fully vest if both the total shareholder returns (TSR) and earnings per share 
(EPS) performance targets of the Group are met. 
The TSR condition will govern the vesting of 50% of the LTIP award. Where TSR performance 
equates to median level in the comparator group, 30% of the award governed by the TSR 
condition will vest. 100% of the award governed by the TSR condition will vest for upper quartile 
performance or above.
The EPS condition will govern the vesting of the remaining 50% of the LTIP , if growth is equal 
to 25% or more per annum then 100% of the award governed by the EPS condition will vest. 
If, however, growth is less than 10% per annum, none of the award governed by the EPS 
condition will vest. 
For both TSR and EPS, performance between the two points of measure will be determined 
on a straight line basis.
4.  The SAYE scheme is subject to a three year savings contract. If this is completed a maximum 
of 4,577 shares will be granted.
5.  If EPS growth is equal to 25% or more per annum then 100% of the award will vest. If, 
however, growth is less than 10% per annum, none of the award governed by the EPS 
condition will vest, performance between the two points of measure will be determined on 
a straight line basis.
6.  The SAYE scheme is subject to a three year savings contract. If this is completed a maximum 
of 2,914 shares will be granted.
The Remuneration Committee recommends the granting of additional share options to the 
value of each executive director’s annual salary, using the same performance criteria to be 
defined and outlined at the AGM.
During the year the Company’s share price varied between 303p and 431p and ended the year  
at 385p.
Approved by the Board and signed on its behalf:
eurfyl ap Gwilym
Chairman, Remuneration Committee
NCC Group plc
2 July 2008
REMUNERATION REPORT
DIRECTORS’
(continued)
NCC Group annual report and accounts 2008 _31
DIRectoRs’ ResPonsIbILItIes
STATEMENT OF
The directors are responsible for preparing the Annual Report and the Group and Parent 
Company financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare Group and Parent Company financial 
statements for each financial year. Under that law they are required to prepare the group 
financial statements in accordance with IFRSs as adopted by the EU and applicable law and 
have elected to prepare the parent company financial statements on the same basis.
The Group and Parent Company financial statements are required by law and IFRSs as adopted 
by the EU to present fairly the financial position of the Group and the Parent Company and the 
performance for that period; the Companies Act 1985 provides in relation to such financial 
statements that references in the relevant part of that Act to financial statements giving a true 
and fair view are references to their achieving a fair presentation.
In preparing each of the Group and Parent Company financial statements, the directors are 
required to: 
n
 select suitable accounting policies and then apply them consistently;
n
 make judgements and estimates that are reasonable and prudent;
n
  state whether they have been prepared in accordance with IFRS as adopted by the EU; 
and
n
  prepare the financial statements on the going concern basis unless it is inappropriate to 
presume that the Group will continue in business.
The directors are responsible for keeping proper accounting records that disclose with 
reasonable accuracy at any time the financial position of the parent company and enable 
them to ensure that its financial statements comply with the Companies Act 1985. They have 
general responsibility for taking such steps as are reasonably open to them to safeguard the 
assets of the group and to prevent and detect fraud and other irregularities.
Under applicable law and regulations, the directors are also responsible for preparing a 
Directors’ Report, Directors’ Remuneration Report and Corporate Governance Statement that 
comply with that law and those regulations.
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.
Responsibility statement of the directors in respect 
of the annual financial report
We confirm that to the best of our knowledge:
n
  the financial statements, prepared in accordance with the applicable set of accounting 
standards, give a true and fair view of the assets, liabilities, financial position and profit or loss 
of the company and the undertakings included in the consolidation taken as a whole; and
n
  the directors’ report includes a fair review of the development and performance of  
the business and the position of the issuer and the undertakings included in the consolidation 
taken as a whole, together with a description of the principal risks and uncertainties that  
they face.
By order of the Board
Rob cotton
Chief Executive
NCC Group plc
2 July 2008
_31
Recycled paper 32_
NCC Group takes its corporate social responsibilities very seriously and recognises the important contributions to the business 
made by the wider community of stakeholders, in particular employees, clients, suppliers and the local communities in which we 
operate. The Board takes into account social, environmental and ethical issues in its discussions and decision making and makes 
the health and safety of employees a priority.
SOCIAL RESPONSIBILITY REPORT
stakeholders
employees
People are at the heart of the Group’s business and the support and involvement of the 
talented individuals who form our team is vital to the continued success of the Group overall. 
The Group has a policy of keeping employees informed of, and engaged in, its business 
strategy through the Intranet, regular employee briefings and divisional meetings. 
We are extremely proud to have been named one of the Top IT Employers in the UK for 2008 in 
an independent study for Computing magazine carried out by CRF, an independent research 
company. NCC Group scored high marks for career development, training and innovation 
in particular, demonstrating that our commitment to developing staff and offering defined 
career paths is delivering results.
Comments and suggestions from employees on the Group’s performance and management 
are actively encouraged and a free flow of information between the directors, managers and 
employees ensures that everyone has an opportunity to contribute. 
clients
The Group values each and every client and is proud of the long standing nature of its client 
relationships. Continuing client satisfaction is central to our ongoing success and is regularly 
measured and monitored through the ISO 9001 certified quality programme. Rare instances 
of negative feedback are treated with the utmost seriousness and dealt with swiftly by 
management through to resolution.
32_
CORPORATE
NCC Group annual report and accounts 2008 _33 _33
the community
We are committed to ensuring that as well as delivering consistently strong results as a 
business, we give something back to the local community. We continue to support charitable 
organisations and actively encourage the involvement of our employees in fundraising by 
covering expenses and awarding additional days’ holiday.
During the year, we supported fundraising for Christie’s, the charity which raises funds for the 
Manchester-based Christie Hospital, one of the largest cancer treatment centres in Europe. 
Through a series of events and sponsored activities ranging from mountain-climbing to cycling 
and five-a-side football, we raised in excess of £23,000. After two very successful years 
supporting Christie’s, where we raised in excess of £37,000 in total, we have now committed 
to support the NSPCC charity, with particular focus on the Childline operations. We have set a 
goal to facilitate the raising of at least £100,000 over the next three years.
suppliers
The Group’s policy is to pay suppliers in accordance with terms and conditions agreed when 
orders are placed. Although the Group does not follow any code or standard on payment 
policy, where terms have not been specifically agreed, invoices dated in one calendar month 
are paid close to the end of the following month.
At 31 May 2008, the Group had an average of 45 days purchases outstanding in trade 
creditors (2007: 28 days).
 
the environment
Although the impact of the Group’s operations on the environment is limited compared 
with other industries, we recognise our responsibility to respect and limit damage to the 
environment. In 2006, an environmental policy was introduced outlining the responsibilities of 
the Group and each employee to act in an environmentally responsible manner, in particular 
through efficient route planning, recycling and sustainable procurement.
Key policies
ethics policy
The Group recognises and understands that our relationships with those who we deal with 
are the key to our success and, as such, we take our obligations and commitments to those 
people and organisations very seriously. Our independence, reputation as a supplier of quality 
services and the trust of our clients are all key assets that we aim to protect at all times. We 
aim to engender in our employees principles of honesty and integrity and the desire to work 
to the best of their ability.
All of these values and principles are founded on an ethics policy which permeates everything  
that we do.
equal opportunities and employment policy
The Group is committed to offering equal opportunities to all; no employee or potential 
employee receives more or less favourable treatment due to their gender, age, race, 
national or ethnic origin, disability, sexual orientation, or marital status. The Group is committed 
to the training and development of all employees and to providing a productive working 
environment.
Should an existing employee’s circumstances change, it is the Group’s policy, wherever 
practicable, to provide continuing employment under normal terms and conditions and to 
provide training and career development and promotion wherever possible.
Health and safety policy
The Group is committed to the good health and wellbeing of its employees and strives to 
provide and maintain a safe and pleasant environment for all employees, clients and visitors 
to its premises and to comply with the relevant health and safety legislation. Continued 
investment is planned in the coming financial year to enhance the working environments of 
employees in all of our offices.
By order of the Board
Rob cotton
Chief Executive
NCC Group plc
2 July 2008
Recycled paper 34_
We have audited the group and parent company financial 
statements (the ‘’financial statements’’) of NCC Group 
plc for the year ended 31 May 2008 which comprise the 
Group Income Statement, the Group and Parent Company 
Balance Sheets, the Group and Parent Company Cash Flow 
Statements, the Group and Parent Company Statements 
of Changes In Equity and the related notes. These financial 
statements have been prepared under the accounting 
policies set out therein. We have also audited the information 
in the Directors’ Remuneration Report that is described as 
having been audited.
This report is made solely to the company’s members, as a 
body, in accordance with section 235 of the Companies Act 
1985 and the terms of our engagement. 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 auditors
The directors’ responsibilities for preparing the Annual 
Report, the Directors’ Remuneration Report and the 
financial statements in accordance with applicable law 
and International Financial Reporting Standards (IFRS) as 
adopted by the EU are set out in the Statement of Directors’ 
Responsibilities on page 31.
Our responsibility is to audit the financial statements and the 
part of the Directors’ Remuneration Report to be audited in 
accordance with relevant legal and regulatory requirements 
and International Standards on Auditing (UK and Ireland).
 
We report to you our opinion as to whether the financial 
statements give a true and fair view and whether the financial 
statements and the part of the Directors’ Remuneration Report 
to be audited have been properly prepared in accordance 
with the Companies Act 1985 and, as regards the Groups’ 
financial statements, Article 4 of the IAS regulation. We also 
report to you whether, in our opinion, the information given in 
the Directors’ Report is consistent with the financial statements. 
The information given in the Directors’ Report includes that 
specific information presented in the Chairman’s Report and 
the Chief Executive’s report that is cross referred from the 
business review section of the Directors’ Report.
In addition we report to you if, in our opinion, the company 
has not kept proper accounting records, if we have not 
received all the information and explanations we require for 
our audit, or if information specified by law regarding directors’ 
remuneration and other transactions is not disclosed.
We review whether the Corporate Governance Statement 
reflects the Company’s compliance with the nine provisions 
of the 2006 Combined Code specified for our review by 
the Listing rules of the Financial Services Authority, and we 
report if it does not. We are not required to consider whether 
the board’s statements on internal control cover all risks 
and controls, or form an opinion on the effectiveness of the 
group’s corporate governance procedure or its risks and 
control procedures. 
We read the other information contained in the Annual 
Report and consider whether it is consistent with the audited 
financial statements. We consider the implications for our 
report if we become aware of any apparent misstatements 
or material inconsistencies with the financial statements. Our 
responsibilities do not extend to any other information.
basis of audit opinion
We conducted our audit in accordance with International 
Standards on Auditing (UK and Ireland) issued by the 
Auditing Practices Board. An audit includes examination, 
on a test basis, of evidence relevant to the amounts and 
disclosures in the financial statements and the part of the 
Directors’ Remuneration Report to be audited. It also includes 
an assessment of the significant estimates and judgments 
made by the directors in the preparation of the financial 
statements, and of whether the accounting policies are 
appropriate to the Group’s and Company’s circumstances, 
consistently applied and adequately disclosed. 
We planned and performed our audit so as to obtain all 
the information and explanations which we considered 
necessary in order to provide us with sufficient evidence to 
give reasonable assurance that the financial statements and 
the part of the Directors’ Remuneration Report to be audited 
are free from material misstatement, whether caused by 
fraud or other irregularity or error. In forming our opinion we 
also evaluated the overall adequacy of the presentation of 
information in the financial statements and the part of the 
Directors’ Remuneration Report to be audited. 
opinion 
In our opinion: 
n
  The Group financial statements give a true and fair view, in 
accordance with IFRS as adopted by the EU, of the state 
of the Group’s affairs as at 31 May 2008 and of its profit for 
the year then ended;
n
  The Parent Company financial statements give a true  
and fair view in accordancewith IFRSs, as adopted by the 
EU and applied in accordance with the provisions of the 
Companies Act 1985, of the state of the parent company’s 
affairs as at 31 May 2008;
n
  The financial statements, as the part of the Directors’ 
Remuneration Report to be audited have been properly 
prepared in accordance with the Companies Act 1985 
and, as regards the Group financial statements, Article 4 
of the IAS Regulation; and
n
  The information given in the Directors’ Report is consistent 
with the financial statements.
 
KPmG Audit Plc
Chartered Accountants 
Registered Auditor
St James’ Square
Manchester M2 6DS 
United Kingdom
to tHe membeRs oF ncc GRoUP PLc
INDEPENDENT AUDITORS REPORT
34_ NCC Group annual report and accounts 2008 _35
  Notes 2008  2007  
   £000  £000  
   
Revenue 2  35,745  25,400  
Cost of sales   (20,055) (13,365)
Gross profit  15,690  12,035  
   
Administrative expenses before amortisation of  
intangible assets and exceptional items   (5,022) (3,853)
earnings before interest, tax, amortisation and exceptional items  10,668  8,182  
Amortisation of intangible assets  (740) (230)
Exceptional items 3 (711) -  
Total administrative expenses  (6,473) (4,083)
   
operating profit 2 9,217  7,952  
   
Financial income 6 78  109   
Finance expense excluding unwinding of discount  (269) (174)
net financing costs excluding unwinding of discount  (191) (65)
Unwinding of discount effect relating to deferred  
consideration on business combinations  (333) (102)
Financial expenses 6 (602) (276)
   
net financing costs  (524) (167)
   
Profit before taxation 4 8,693  7,785  
Taxation 7 (2,340) (2,411)
Profit for the year  6,353  5,374   
   
Attributable to equity holders of the parent company  6,353  5,374   
Profit for the year  6,353  5,374  
   
earnings per share 9  
Basic earnings per share  18.9p 16.5p
Diluted earnings per share  18.3p 15.9p
    
Recycled paper
income statement
Consolidated
For the year ended 31 May 2008 36_
 Notes  2008               2007              
  £000 £000 £000 £000
non current assets     
Intangible assets 11 51,833  39,302 
Plant and equipment 12 1,939  1,482 
Deferred tax assets 15 1,145  2,005 
total non-current assets  54,917  42,789 
     
current assets     
Trade and other receivables 13 12,351  7,757 
Cash and cash equivalents  1,142  4,377 
total current assets  13,493  12,134 
     
total assets   68,410  54,923
     
equity     
Issued capital 21 336  326 
Share premium  21,537  19,929 
Retained earnings  17,569  13,144 
Currency translation reserve  12  39 
total equity attributable to equity holders of the parent   39,454  33,438 
  
non current liabilities     
Interest bearing loans 18 54  3,500 
Other financial liabilities 18 92  3,782 
Deferred tax liability 15 1,499  473 
total non current liabilities  1,645  7,755 
     
current liabilities     
Interest bearing loans 19 4,500  - 
Trade and other payables            16 11,270  3,931 
Deferred revenue                   17 11,009  8,620 
Current tax payable  532  1,179 
total current liabilities  27,311  13,730 
total liabilities   28,956  21,485
total liabilities and equity   68,410  54,923
     
at 31 May 2008
GROUP BALANCE SHEET
These financial statements were approved 
by the Board of Directors on 2 July 2008 
and were signed on its behalf by: 
 
 
 
 
Rob cotton
Chief Executive
NCC Group plc 
 
NCC Group annual report and accounts 2008 _37
     Restated             
 Notes  2008              2007             
  £000 £000 £000 £000
non current assets     
Investments 26 29,994  29,550 
total non-current assets  29,994  29,550  
     
current assets     
Trade and other receivables         13 -  235 
Cash and cash equivalents  12  12 
total current assets  12  247 
     
total assets   30,006  29,797
     
equity     
Issued capital                      21 336  326 
Share premium                     21,537  19,929 
Retained earnings                   4,974  3,686 
total equity    26,847  23,941
     
current liabilities     
Trade and other payables            16 3,159  5,856 
total current liabilities  3,159  5,856 
total liabilities   3,159  5,856
total liabilities and equity   30,006  29,797
     
     
     
at 31 May 2008
COMPANY BALANCE SHEET
These financial statements were approved 
by the Board of Directors on 2 July 2008 and 
were signed on its behalf by: 
 
 
 
 
Rob cotton
Chief Executive
NCC Group plc 
 
Recycled paper 38_
 Notes 2008  2007  
  £000  £000  
cash inflow from operating activities   
Profit for the year  6,353  5,374  
Adjustments for:   
Depreciation charge  1,045  688  
Share based charges  742  575  
Amortisation of intangible assets  740  230  
Net financing costs  191  167  
Profit on sale of plant and equipment  (5) -  
Income tax expense  2,340  2,411  
Profit for the year before changes in working capital   11,406  9,445  
Increase in receivables  (3,620) (1,976)
Increase in payables  3,460  314  
cash generated from operating activities before interest and tax  11,246  7,783   
Interest paid  (489) (166)
Income taxes paid  (2,657) (2,449)
net cash generated from operating activities  8,100  5,168  
   
cash flows from investing activities    
Interest received  273  109  
Proceeds from the sale of plant and equipment  69  1  
Acquisition of plant and equipment  (1,466) (734)
Acquisition of business 14 (10,418) (3,641)
net cash used in investing activities  (11,542) (4,265)
   
cash flows from financing activities   
Proceeds from the issue of ordinary share capital  1,618  16  
Proceeds from borrowings  993  3,500  
Purchase of own shares  (559) -  
Payment of bank loans  - (3,900)
Equity dividends paid  (1,817) (1,304)
net cash from financing activities  235  (1,688)
   
net (decrease) in cash and cash equivalents 22 (3,207) (785)
   
cash and cash equivalents at beginning of year  4,377  5,139  
Effect of exchange rate fluctuations on cash held  (28) 23  
cash and cash equivalents at end of year  1,142  4,377  
   
   
for the year ended 31 May 2008
GROUP CASH FLOW STATEMENT
NCC Group annual report and accounts 2008 _39
for the year ended 31 May 2008
COMPANY CASH FLOW STATEMENT
 2008  2007  
 £000  £000  
cash inflow from operating activities  
(Loss) for the year (1,050) (77)
Adjustments for:  
Share based charges 270  169  
Net financing costs -  57  
(Loss) / profit for the year before changes in working capital  (780) 149  
(Increase) / decrease in receivables -  (70)
(Decrease) / increase in payables (2,462) 5,195  
Profit for the year before interest and tax (3,242) 5,274  
Interest paid -  (80)
net cash generated from operating activities (3,242) 5,194  
  
cash flows from investing activities  
Interest received -  1  
net cash inflow in investing activities -  1  
  
cash flows from financing activities  
Proceeds from the issue of ordinary share capital 1,618  16  
Purchase of own shares (559) -  
Payment of bank loans -  (3,900)
Equity dividends received 4,000  -  
Equity dividends paid (1,817) (1,304)
net cash from financing activities 3,242  (5,188)
  
net increase in cash and cash equivalents -  7  
    
cash and cash equivalents at beginning of year 12  5  
cash and cash equivalents at end of year 12  12  
  
Recycled paper 40_
Group Share Share Retained  Currency  total    
 capital premium earnings  translation  equity   
 £000 £000 £000  £000  £000  
balance at 1 June 2006 326 19,913 7,964  15  28,218   
Share based charges - - 575  -  575   
Deferred tax on share based payments - - 535  -  535   
Profit for the year - - 5,374  -  5,374   
Shares issued - 16 -  -  16   
Currency translation reserve - - -  24  24   
Dividends to shareholders - - (1,304) -  (1,304) 
balance at 31 may 2007 326 19,929 13,144  39  33,438 
balance at 1 June 2007 326 19,929 13,144  39  33,438   
Share based charges - - 742  -  742   
Purchase of own shares - - (559) -  (559) 
Deferred tax on share based payments - - (294) -  (294) 
Profit for the year - - 6,353  -  6,353   
Shares issued 10 1,608 -  -  1,618   
Currency translation reserve - - -  (27) (27) 
Dividends to shareholders - - (1,817) -  (1,817) 
balance at 31 may 2008 336 21,537 17,569  12  39,454         
company Share Share Retained   total    
 capital premium earnings   equity    
 £000 £000 £000   £000   
balance at 1 June 2006 326 19,913 4,493   24,732    
Share based charges - - 169   169    
Increase in subsidiary investment for share based charges - - 405   405    
Loss for the year - - (77)  (77) 
Shares issued - 16 -   16    
Dividends to shareholders - - (1,304)  (1,304) 
balance at 31 may 2007 restated 326 19,929 3,686   23,941 
balance at 1 June 2007 326 19,929 3,686   23,941    
Share based charges - - 270   270    
Increase in subsidiary investment for share based charges - - 444   444    
Loss for the year - - (1,050)  (1,050) 
Shares issued 10 1,608 -   1,618    
Purchase of own shares - - (559)  (559) 
Dividends from subsidiaries - - 4,000   4,000    
Dividends to shareholders - - (1,817)  (1,817) 
balance at 31 may 2008 336 21,537 4,974   26,847          
   
             
  
for the year ended 31 May 2008
st Atement oF cHAnGes In eqUIty
NCC Group annual report and accounts 2008 _41
INCREASED
BY 33%
eARnInGs PeR sHARe
_41
Recycled paper 42_
1 Accounting policies
basis of preparation
NCC Group plc (“the Company”) is a company incorporated in the UK.
The Group financial statements consolidate those of the company and its subsidiaries (together 
referred to as the “Group”). The parent company financial statements present information 
about the Company as a separate entity and not about its Group.
Both the parent and the Group financial statements have been prepared and approved by 
the directors in accordance with International Financial Reporting Standards as adopted by 
the EU (“Adopted IFRS”). On publishing the parent company financial statements here together 
with the Group financial statements, the company is taking advantage of the exemption in 
s230 of the Companies Act 1985 not to present its individual income statement and related 
notes that form a part of these approved financial statements.
The accounting policies set out below have, unless otherwise stated, been applied consistently 
to all periods presented in these Group financial statements. 
basis of consolidation
Subsidiaries are entities controlled by the Group. Control exists when the Group has the 
power, directly or indirectly, to govern the financial and operating policies of an entity so as to 
obtain benefits from its activities. In assessing control, potential voting rights that are currently 
exercisable or convertible are taken into account. The financial statements of subsidiaries are 
included in the consolidated financial statements from the date that control commences 
until the date that control ceases.
Intangible assets and goodwill
All business combinations are accounted for by applying the purchase method. Goodwill 
represents amounts arising on acquisition of subsidiaries. In respect of business acquisitions 
that have occurred since 1 June 2004, goodwill represents the difference between the cost of 
the acquisition and the fair value of the net identifiable assets acquired including identifiable 
intangible assets. Identifiable intangibles are those which can be sold separately or which 
arise from legal rights regardless of whether those rights are separable.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to 
cash-generating units based on the allocation of the business acquired and is not amortised 
but is tested annually for impairment. 
In respect of acquisitions prior to 1 June 2004, goodwill is included at its deemed cost, 
which represents the amount recorded under UK GAAP at 31 May 2004 which was broadly 
comparable save that only separable intangibles were recognised and goodwill was 
amortised. 
Other intangible assets that are acquired by the Group are stated at cost less accumulated 
amortisation. Amortisation is charged to the income statement on a straight line basis over 
the estimated useful lives of intangible assets unless such lives are indefinite. Goodwill is tested  
for impairment at each balance sheet date or whenever there is an indication of impairment. 
Other intangibles are amortised from the date they are available for use. Acquired customer 
contracts and relationships are amortised over their estimated useful economic life of between 
5 and 20 years.
Related party transactions
Details of related party transactions are set out in note 25 to these financial statements.
Plant and equipment is stated at cost less accumulated depreciation. Depreciation is charged 
to the income statement on a straight line basis over the estimated useful lives of each part 
of an item of plant and equipment. The rates applied are as follows:
Computer equipment - 20% to 33% 
Plant and equipment - 20%
Fixtures and fittings  - 20%
Motor vehicles  - 25% 
Plant and equipment is also tested for impairment whenever there is an indication of potential 
impairment.
Investments in subsidiaries
Investments in subsidiaries are carried at cost less impairment and pre acquisition dividends.
  Revenue recognition
Revenue represents the value of services provided during the period, excluding VAT. 
n
   testing and consultancy
  The results of partially completed contracts whether fixed price or on a time and materials basis 
are dealt with on a percentage completion basis according to the number of days worked  
by including the profit or loss earned on work completed to the balance sheet date. 
Provisions are made for any losses on uncompleted contracts expected to be incurred 
after the balance sheet date. 
n
   escrow and website monitoring
  Other than fees attributable to initial setup on the signing of a new contract, which is 
recognised when the contract is signed, maintenance and escrow solutions agreement 
revenue is deferred and released to the income statement on a straight-line basis over the 
life of the related agreement, on the basis that the performance is deemed to fall evenly 
over the contract period.
forming part of the financial statements
notes
NCC Group annual report and accounts 2008 _43
Foreign currencies
Transactions in foreign currencies are recorded using the rate of exchange ruling at the date 
of the transaction. Monetary assets and liabilities denominated in foreign currencies are 
translated using the rate of exchange ruling at the balance sheet date and the gains or losses 
on translation are included in the income statement.
The assets and liabilities of overseas subsidiaries denominated in foreign currencies are 
translated at the closing rate and income statements of overseas subsidiary undertakings  
are translated at the average exchange rates. Gains and losses arising on these transactions 
are taken to the currency translation reserve. They are released to the income statement  
upon disposal.
operating leases payments
Operating lease rentals are charged to the income statement on a straight-line basis over the 
period of the lease. Lease incentives received are recognised in the income statement as an 
integral part of the total lease expense.
employee benefits – defined contribution plans
The Group operates a defined contribution pension scheme. The assets of the scheme are 
kept separately from those of the Group in an independently administered fund. The amount 
charged as expense in the income statement represents the contributions payable to the 
scheme in respect of the accounting period.
share-based payment transactions
The share option programme allows Group employees to acquire shares of the parent 
company; these awards are granted by the parent. The fair value of options granted is 
recognised as an employee expense with a corresponding increase in equity. The fair value 
is measured at grant date and spread over the period during which the employees become 
unconditionally entitled to the options. The fair value of the options granted is measured 
using an option valuation model, taking into account the terms and conditions upon which 
the options were granted. The amount recognised as an expense is adjusted to reflect the 
actual number of share options that vest except where forfeiture is due only to share prices 
not achieving the threshold for vesting. In the Company’s accounts, the fair value of share 
options granted to employees of subsidiary companies is included in Investments with a 
corresponding increase in equity.
Interest bearing borrowings
Interest bearing borrowings are recognised initially at fair value less attributable transaction 
costs. Subsequent to initial recognition interest bearing borrowings are stated at amortised 
cost with any difference between cost and redemption value being recognised in the income 
statement over the period of the borrowings on an effective interest basis.
net financing costs
Net financing costs comprise interest payable and interest receivable on funds invested. 
Interest income and interest payable is recognised in the income statement as they accrue. 
Dividend income is recognised in the income statement on the date the entity’s right to 
receive the payments is established and pre acquisition dividends are deducted from the 
cost of investment.
contingent consideration under business combinations
Contingent consideration on business combinations is recognised only to the extent that it 
can be reliably estimated and it is probable that the consideration will be paid.
taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the 
income statement except to the extent that it relates to items recognised directly in equity, in 
which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates 
enacted or substantively enacted at the balance sheet date, and any adjustment to tax 
payable in respect of previous years.
Deferred tax is provided on temporary differences between the carrying amounts of assets 
and liabilities for financial reporting purposes and the amounts used for taxation purposes. The 
following temporary differences are not provided for: the initial recognition of goodwill and 
the initial recognition of assets or liabilities that affect neither accounting nor taxable profit 
other than in a business combination. The amount of deferred tax provided is based on the 
expected manner of realisation or settlement of the carrying amount of assets and liabilities, 
using tax rates enacted or substantively enacted at the balance sheet date.
 
A deferred tax asset is recognised only to the extent that it is probable that future taxable 
profits will be available against which the asset can be utilised. 
Intra-group financial instruments
Where the Company enters into financial guarantee contracts to guarantee the indebtedness 
of other companies within the Group, the Company considers these to be insurance 
arrangements and accounts for them as such. In this respect the Company treats the 
guarantee contract as a contingent liability until such time as it becomes probable that the 
Company will be required to make a payment under the guarantee.
Recycled paper 44_
IFRs adopted for the first time
In these financial statements the following new statements have been adopted for the  
first time;
IFRS 7 Financial Instruments: Disclosures (Note 19)
IFRS 1 Amendment to IAS 1 – Capital disclosures (Note 19)
IFRIC 11 Group and Treasury Share Transactions
The adoption of the IFRIC 11 is referred to in Note 26 and has required a prior year adjustment. 
This adjustment has increased Investments in Subsidiaries in the Company by £444,000 in the 
current year and £405,000 in the prior year with a corresponding increase in equity. There has 
been no impact on the Group of the adoption of IFRIC 11. The impact of adoption of IFRS 7 
and IFRS 1 amendment is shown in the referred notes.
Adopted IFRs not yet applied
The following adopted IFRS were available for early adoption but have not been applied by 
the Group in these financial statements;
International accounting standards (IFRs)
IFRS 8  Operating segments
IFRIC 7 Hyperinflation
IFRIC 8 Scope of IFRS 2 – Share based payments
The directors do not anticipate that the adoption of these standards and interpretations will 
have a material impact on the Group’s financial statements. 
trade and other receivables
Trade and other receivables are stated at their nominal amount less impairment losses.
cash and cash equivalents
Cash and cash equivalents comprise of cash in hand and deposits repayable on demand. 
Bank overdrafts that are repayable on demand form part of the Group’s cash management 
and are included as a component of cash and cash equivalents for the purpose only of the 
statement of cash flows. 
basis of measurement
The financial statements are prepared on the historical cost basis except for share based 
payment transactions and assets and liabilities acquired in a business combination.
Use of estimates and judgements
Information about the most significant areas of estimation and judgements is described in 
the following notes; 
11 Goodwill
14 Acquisitions
20 Measurement of share based payments
(continued)
NOTES
NCC Group annual report and accounts 2008 _45
2 segmental information
The Group is organised into three primary business segments; Escrow Solutions, Assurance Testing and Consultancy. These three segments 
are the Group’s primary reporting format for segment information. Escrow Solutions (Europe) includes amounts previously reported as Escrow 
Solutions Germany. All segments are located in the UK unless indicated otherwise.
    2008  2007   
    £000  £000  
Revenue by business segment  
Escrow Solutions (UK)    15,724  13,790  
Escrow Solutions (Europe)    1,094  203  
Escrow Solutions (US)    1,190  1,028  
Total Escrow Solutions    18,008  15,021  
Assurance Testing    12,835  5,795  
Consultancy    4,902  4,584  
total revenue    35,745  25,400  
  
operating profit by business segment  
Escrow Solutions (UK)    9,393  8,182  
Escrow Solutions (Europe)    376  (476)
Escrow Solutions (US)    394  248  
Total Escrow Solutions    10,163  7,954  
Assurance Testing    1,678  740  
Consultancy    726  717  
Segment operating profit    12,567  9,411  
Head office costs    (1,899) (1,229)
operating profit before amortisation and exceptional items   10,668 8,182 
Amortisation of intangible assets Escrow (US)    (115) (118)
Amortisation of intangible assets Assurance Testing    (458) (112)
Amortisation of intangible assets Escrow Europe    (167) -  
operating profit before exceptional items    9,928  7,952  
Exceptional items    (711) -   
operating profit    9,217  7,952    
Interest and tax are not allocated to business segments and there are no inter segment sales.
 
Recycled paper 46_
  Assets Liabilities  Assets Liabilities  
  2008 2008  2007 2007  
  £000 £000  £000 £000  
Assets / (liabilities) by business segment    
Escrow Solutions (UK)  4,623 (7,775) 3,419 (7,063)
Escrow Solutions (Europe)  5,268 (3,296) 175 (126)
Escrow Solutions (US)  4,483 (744) 4,341 (664)
Total Escrow Solutions  14,374 (11,815) 7,935 (7,853)
Consultancy  2,790 (823) 2,108 (666)
Assurance Testing  8,055 (9,451) 7,199 (7,794)
Unallocated net assets  43,191 (6,871) 37,681 (5,172)
total assets / (liabilities)  68,410 (28,960) 54,923 (21,485)
Unallocated net assets consist of goodwill arising on consolidation, cash, tax payable and other centrally held assets and liabilities.
     Total costs
     incurred to
     acquire
    Capital  segmental
2007   Depreciation expenditure assets
   £000 £000 £000
Escrow Solutions (UK)   318 331 -
Escrow Solutions (Europe)   32 12 -
Escrow Solutions (US)   52 89 1,124
Total Escrow Solutions   402 432 1,124
Consultancy   85 60 -
Assurance Testing   195 242 4,766
Head office   6 5 -
total   688 739 5,890
     Total costs
     incurred to
     acquire
    Capital  segmental
2008   Depreciation expenditure assets
   £000 £000 £000
Escrow Solutions (UK)   508 807 -
Escrow Solutions (Europe)   51 26 6,832
Escrow Solutions (US)   55 17 -
Total Escrow Solutions   614 850 6,832
Consultancy   71 137 -
Assurance Testing   360 485 2,725
Head office   - - -
total   1,045 1,472 9,557
(continued)
NOTES
NCC Group annual report and accounts 2008
Ian Lever
technical Director - consultancy _47
2 segmental information (continued)
The table below provides additional disclosure on revenue by geographical market where the customer is based.
    2008  2007   
    £000  £000   
Revenue by geographical segment      
UK    29,238 20,620  
Rest of Europe    2,745 1,756  
Rest of the World    3,762 3,024  
total revenue    35,745 25,400
   
The table below provides additional disclosure on assets / (liabilities) by geographical market where the assets / (liabilities) are based.
 
  Assets Liabilities  Assets Liabilities  
  2008 2008  2007 2007  
  £000 £000  £000 £000  
Assets / (liabilities) by geographical segment      
UK  58,659 (21,354) 50,407 (20,695) 
Rest of Europe  5,268 (3,610) 175 (126) 
Rest of the World  4,483 (3,992) 4,341 (664) 
total assets / (liabilities)  68,410 (28,956) 54,923 (21,485) 
3 exceptional Items
The Group identifies separately items as “exceptional”. These are items which in the management’s judgement, need to be disclosed by virtue  
of their size or incidence in order for the user to obtain a proper understanding of the financial information.
Exceptional items in the year ended 31 May 2008 were costs relating to the move to the London Stock Exchange’s Official List on 13 July 2007  
(£531,000) and reorganisation costs following the acquisition of Escrow Europe (£180,000).
 
Ian Lever
technical Director - consultancy
Recycled paper 48_
4 expenses and auditors’ remuneration
    2008   2007   
    £000   £000 
 
Profit before taxation is stated after charging/(crediting):
      
Amounts receivable by auditors and their associates in respect of:      
Audit of these financial statements    32  5 
Audit of financial statements of subsidiaries pursuant to legislation   10  29 
Other services pursuant to legislation    -  5 
Services relating to corporate finance transactions entered into or proposed to be  
entered into by or on behalf of the Company or Group    115  - 
Depreciation and other amounts written off tangible and intangible fixed assets:     
Owned    1,045  688 
Amortisation of intangible assets    740  230 
Exchange losses    15  11 
Operating lease rentals charged:      
Hire of property, plant and equipment    604  305 
Other operating leases    420  445 
Profit on disposal of fixed assets    (5) - 
      
(continued)
NOTES
NCC Group annual report and accounts 2008
eileen conlon
Assistant company secretary _49
5 staff numbers and costs
Directors’ emoluments are disclosed in the directors’ remuneration report on pages 26 to 30.
Group
The average number of persons employed by the Group during the year, including directors is analysed by category as follows:
    Number of  Number of  
    employees employees  
    2008 2007  
      
Operational    77 59 
Administration, sales and marketing    230 179 
    307 238 
      
The aggregate payroll costs of these persons were as follows:      
    2008 2007 
    £000 £000
      
Wages and salaries    14,315 9,829 
Share based payments (note 20)    742 575 
Social security costs    1,891 1,120 
Other pension costs (note 24)    324 257 
    17,272 11,781 
company
The average number of persons employed by the company during the year, including directors is analysed by category as follows:
    Number of  Number of
    employees employees
    2008 2007 
      
Administration, sales and marketing    2 2 
    2 2
 
The aggregate payroll costs of these persons were as follows:      
    2008 2007 
    £000 £000 
      
Wages and salaries    589 435 
Share based payments (note 20)    270 169 
Social security costs    74 62 
Other pension costs (note 24)    32 26 
    965 692 
Recycled paper 50_
6 net financing costs
    2008  2007   
    £000  £000   
Financial income      
Interest on short term deposits    78  109  
    78  109  
      
Financial expenses      
Interest payable on bank loans and overdrafts    (269) (163) 
Amortisation of deal fees on term loans    -  (11) 
Deferred consideration finance expense (see below)    (333) (102) 
    (602) (276)
 
 The deferred consideration finance expense of £333,000 (2007: £102,000) relates to the acquisition of Site Confidence, Secure Test and Escrow Europe.
 
Deferred consideration related to the acquisition of subsidiary undertakings has been discounted to present values. The unwinding of the discount has 
been treated as a finance expense and is analysed in the table below:
Deferred consideration finance expense    2008  2007   
    £000  £000  
    
Site Confidence Limited    233  102  
Secure Test Limited    76  -  
Escrow Europe Holdings B.V.    24  -  
    333  102  
The discount rate used was 6.5% (2007: 6.5%). 
The total net present value of the deferred contingent consideration as at 31 May is shown in the following table:
current liabilities – deferred consideration (note 16)    2008  2007   
    £000  £000   
       
Site Confidence Limited    3,908  891   
Secure Test Limited    1,485  -   
Escrow Europe Holdings B.V.    717  -   
Source Harbor Inc    -  105   
    6,110  996   
non-current liabilities – deferred consideration (note 18)       
Site Confidence Limited (transferred to current liabilities)    -  3,675    
 
    -  3,675   
(continued)
NOTES
NCC Group annual report and accounts 2008
barry clegg
escrow sales manager _51
7 taxation
Recognised in the income statement
    2008  2007  
    £000  £000  
Current tax expense   
Current year    2,029  2,571  
Adjustment to tax expense in respect of prior periods    4  (11)  
Foreign tax    (10) 12  
Total current tax    2,023  2,572  
Deferred tax (see note 15)    317  (161)
Tax in income statement    2,340  2,411  
Reconciliation of effective tax rate
    2008  2007  
    £000  £000  
   
Profit before taxation    8,693  7,785  
Current tax using the UK corporation tax rate of 30% (2007: 30%)   2,608  2,336  
   
Effects of:   
Items not (taxable) / deductable for tax purposes    (257) 74  
Foreign tax    (1) 12  
Marginal relief    (2) -  
Difference in tax rates (Deferred tax)    (5) -  
Difference in tax rates (Current tax)    (22) -  
Adjustment to tax charge in respect of prior periods    19  (11)
Total current tax    2,340  2,411   
Deferred tax recognised directly in equity was £294,000 (2007: £535,000)
Recycled paper 52_
8 Dividends
    2008 2007 
    £000 £000
Dividends paid and recognised in the year    1,817 1,304
Dividends proposed but not recognised in the year    1,596 1,060
  
Dividends per share paid and recognised in the year    2.25p 4.00p
Dividends per share proposed but not recognised in the year    4.75p 3.25p
9 earnings per share
The calculation of earnings per share is based on the following:
    2008  2007  
    £000  £000  
  
Profit for the year    6,353 5,374
  
    number of  Number of
    shares shares
    000’s 000’s
     
Basic weighted average number of shares in issue    33,653 32,611
Dilutive effect of share options    1,021 1,256
Diluted weighted average shares in issue    34,674 33,867
10 Profit attributable to members of the parent company
The loss for the year dealt with in the accounts of the parent company was £1,050,000 (2007: £77,000 loss).
(continued)
NOTES
NCC Group annual report and accounts 2008 _53
11 Intangible assets - Group
   customer 
   contracts and 
   relationships Goodwill  total
   £000 £000 £000
cost     
At 1 June 2006   2,250 28,217 30,467
Additions   1,964 7,148 9,112
At 31 May 2007   4,214 35,365 39,579
Additions    4,515 8,756 13,271
At 31 may 2008   8,729 44,121 52,850
    
Amortisation    
At 1 June 2006   47 - 47
Charge for year   230 - 230
At 31 May 2007   277 - 277
Charge for year   740 - 740
At 31 may 2008   1,017 - 1,017
    
Net book value    
At 31 may 2008   7,712 44,121 51,833
Net book value    
At 31 May 2007   3,937 35,365 39,302
The Group has made two acquisitions in the year, details of which are included in note 14. The Company has no intangible assets.
Goodwill considered significant in comparison to the Group’s total carrying amount of such assets have been allocated to cash generating 
units or groups of cash generating units as follows:
    Goodwill Goodwill
    2008 2007
Cash generating units    £000 £000
Escrow    22,871 22,871
Assurance Testing    2,301 2,301
Consultancy    2,229 2,229
NCC Group plc    27,401 27,401
NCC Group Inc     1,218 1,354
Site Confidence Limited    6,610 6,610
Secure Test Limited    3,351 -
Escrow Europe Holdings B.V.    5,541 -
    44,121 35,365
Recycled paper
Iain Lewis
managing consultant - securet est
Recycled paper
_53 54_
NCC Group Inc includes goodwill on the acquisition of the escrow division of Recall Information Management Inc and Source Harbor Inc. 
The recoverable amount of the cash generating units has been calculated with reference to its fair value in use. In calculating this value, 
management have used the following assumptions. Management have used experience in determining the values assigned to each key 
assumption, sales levels are based on historical trends and a prudent estimate of market growth. The period over which management 
approved forecasts are based is three years using a discount rate of 11.5%, the growth rate beyond 3 years is assumed to be zero. There is 
significant headroom on this basis. 
12 Plant and equipment – Group
 computer Plant and Fixtures motor 
 equipment equipment and fittings vehicles total  
 £000 £000 £000 £000 £000  
cost      
At 1 June 2006 2,096 358 500 197  3,151  
Additions 627 14 56 42  739  
Acquisition of Group companies 381 33 38 -  452  
Disposals (1) - - -  (1)
At 31 May 2007 3,103 405 594 239  4,341  
Additions 828 - 480 164  1,472  
Acquisition of Group companies 115 - 95 -  210  
Disposals - - - (122) (122)
At 31 may 2008 4,046 405 1,169 281  5,901  
     
Depreciation     
At 1 June 2006 1,442 193 233 26  1,894  
Charge for year 458 64 109 57  688  
On disposals 244 10 23 -  277  
At 31 May 2007 2,144 267 365 83  2,859  
Charge for year 757 56 160 72  1,045  
Acquisition of Group companies 69 - 48 -  117  
Disposals - - - (59) (59)
At 31 may 2008 2,970 323 573 96  3,962  
     
net book value     
At 31 may 2008 1,076 82 596 185  1,939  
Net book value     
At 31 May 2007 959 138 229 156  1,482  
The Company has no plant and equipment 
(continued)
NOTES
NCC Group annual report and accounts 2008
Lloyd brough
managing consultant - securet est _55
13 trade and other receivables
  Group Group company Company
  2008 2007 2008 2007
  £000 £000 £000 £000
     
Trade receivables  10,235 5,792 - -
Amounts owed by Group undertakings  - - - 235
Prepayments and accrued income  2,116 1,965 - -
  12,351 7,757 - 235
_55
Recycled paper 56_
(continued)
NOTES
14 Acquisitions
A. On 1 August 2007 the Group acquired 100% of the share capital of Secure Test Limited for a maximum consideration of £4,000,000 of which 
£1,500,000 has been withheld subject to the achievement of performance criteria specified in the purchase agreement. The present value of 
the deferred consideration on 1 August 2007 was £1,408,000. The performance conditions are required to be satisfied by July 2008.
The acquisition had the following effect on the Group’s assets and liabilities:
   Acquiree’s  Fair value  Acquisition  
   book values  adjustments  amounts  
   £000  £000  £000  
Acquiree’s identifiable net assets at the acquisition date:   
Plant and equipment   60  -  60  
Trade and other receivables   550  -  550  
Deferred tax asset   -  29  29  
Deferred tax liability   -  (154) (154)
Cash   222  -  222  
Creditors and accruals   (438)       -  (438)
Intangible assets purchased   -  512  512  
Net identifiable (liabilities) / assets    394  387  781  
Goodwill on acquisition     3,352  
Maximum consideration to be paid including expenses     4,133  
Less purchase consideration withheld     (1,408)
Net cash outflow     2,725  
Cash acquired     (222)
Net cash outflow excluding cash acquired     2,503  
Goodwill has arisen on the acquisition because the purchase price exceeds the fair value of the separately identifiable net assets acquired 
including £512,000 assigned to customer relationships and contracts. Goodwill represents synergies, business processes and the assembled 
value of the work force including industry specific knowledge and technical skills.  
From the date of acquisition Secure Test Limited contributed an operating profit before amortisation of intangible assets of £337,000 and 
revenue of £3,150,000 to the Group consolidated income statement for the year ended 31 May 2008. After amortisation of intangible 
assets, operating profits were £169,000. 
B. On 22 January 2008 the Group acquired 100% of Escrow Europe Holdings B.V. for a maximum consideration of £7,955,000 of which 
£2,299,000 was withheld subject to the achievement of performance criteria specified in the purchase agreement. A second instalment 
of £647,000 was paid on 10 April 2008 in relation to the partial achievement of the performance conditions. The remaining performance 
conditions are due to be satisfied by July 2008, £693,000 is recognised as a liability in the financial statements for the year ended 31 May 
2008 in relation to the final instalment. 
 
NCC Group annual report and accounts 2008
craig Foster
Financial controller - Acquisitions _57
14 Acquisitions (continued)
The acquisition had the following effect on the Group’s assets and liabilities.
   Acquiree’s  Fair value  Acquisition  
   book values  adjustments  amounts  
   £000  £000 £000  
Acquiree’s identifiable net assets at the acquisition date: 
Goodwill   583  -  583  
Plant and equipment   33  -  33  
Trade and other receivables   428  -  428  
Tax recoverable   25  -  25  
Deferred tax liability   -  (1,121) (1,121)
Cash   98  -  98  
Creditors and accruals   (278) -  (278)
Interest bearing loans   (61) -  (61)
Deferred consideration on acquisition   (319)       -  (319)
Deferred Income   (823) -  (823)
Intangible assets purchased   -  4,003  4,003  
Net indentifiable assets   (314) 2,882  2,568  
Goodwill on acquisition     4,957  
Expected consideration to be paid including expenses     7,525  
Less purchase consideration withheld     (693)
Net cash outflow      6,832  
Cash acquired     (98)
Net cash outflow excluding cash acquired     6,734  
Goodwill has arisen on the acquisition because the purchase price exceeds the fair value of the separately identifiable net assets acquired 
including £4,003,000 assigned to customer relationships and contracts. Goodwill represents synergies, business processes and the assembled 
value of the work force including industry specific knowledge and technical skills. 
From the date of acquisition Escrow Europe Holdings B.V. contributed an operating profit before amortisation of intangible assets of £381,000 
and revenue of £849,000 to the Group consolidated income statement for the year ended 31 May 2008. After amortisation of intangible 
assets, operating profits were £214,000.
C. On 7 July 2006, the Group acquired the trade and net assets of Source Harbor Inc for a maximum consideration of £897,000 of which 
£111,000 was withheld subject to the achievement of performance criteria specified in the purchase agreement. 
The performance conditions were required to be satisfied by 30 September 2006 were not achieved and the liability for deferred consideration 
recognised in the financial statements for the year ended 31 May 2007 of £111,000 was reversed, in addition a refund of £25,000 was paid back 
to the group in recognition of the shortfall in performance levels, This has been accounted for by reducing the carrying value of goodwill.
D. If all of the acquisitions had occurred at the beginning of the financial year it is estimated that the consolidated revenue and operating 
profit for the year ended 31 May 2008 would have been approximately £37.5m and £11.2m respectively.
 
Recycled paper 58_
John mundell
escrow commercial sales manager
(continued)
NOTES
15 Deferred tax assets and liabilities
Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
  Assets                     Liabilities           net                 
 2008  2007   2008   2007   2008   2007   
 £000 £000  £000  £000  £000  £000  
Plant and equipment 180 137  -  -  180  137  
Short term temporary differences 13 13  -  -  13  13  
Trade losses 390 815  -  -  390  815  
Intangible assets - -  (1,499) (473) (1,499) (473)
Share based payments 562 1,040  -  -  562  1,040  
Deferred tax assets / (liabilities) 1,145 2,005  (1,499) (473) (354) 1,532  
Movement in deferred tax during the year
  1 June  Recognised  Recognised  Arising on  31 may  
  2007  in income  In equity  acquisition  2008  
  £000  £000  £000  £000  £000  
Plant and equipment  137  43  -  -  180  
Short term temporary differences  13  -  -  -  13  
Trade losses  815  (425) -  -  390  
Intangible assets  (473) 250  -  (1,275) (1,498)
Share based payments  1,040  (185) (294) -  561  
  1,532  (317) (294) (1,275) (354)
Movement in deferred tax during the prior year
  1 June  Recognised  Recognised  Arising on  31 May  
  2006  in income  In equity  acquisition  2007  
  £000  £000  £000  £000  £000  
Plant and equipment  74  63  -  -  137  
Short term temporary differences  9  4  -  -  13  
Trade losses  -  (78) -  893  815  
Intangible assets  -  -  -  (473) (473)
Share based payments  333  172  535  -  1,040  
     416  161  535  420  1,532  
The Company has no deferred tax assets or liabilities
NCC Group annual report and accounts 2008 _59
16 trade and other payables
  Group Group company Company 
  2008 2007 2008 2007 
  £000 £000 £000 £000
 
Trade payables  965 431 - - 
Amounts owed to Group undertakings  - - 2,987 5,807 
Interest payable  4 29 - - 
Non trade payables  1,655 963 - - 
Deferred consideration on acquisition of subsidiary (note 6)  6,110 996 - -
Accruals  2,536 1,512 172 49 
  11,270 3,931 3,159 5,856 
17 Deferred revenue
  Group Group company Company
  2008 2007 2008 2007
  £000 £000 £000 £000
     
Deferred revenue  11,009 8,620 - -
  11,009 8,620 - -
Deferred revenue of £9,043,000 (2007: £6,856,000) consists of Escrow Solutions agreement revenue and maintenance revenue that has 
been deferred to be released to the income statement over the contract term on a pro-rata basis. 
Deferred revenue of £1,966,000 (2007: £1,764,000) consists of internet monitoring and load testing agreement revenue that has been 
deferred to be released to the income statement over the contract term on a pro-rata basis. 
Recycled paper Recycled paper 60_
18 non-current liabilities
  Group Group  company Company  
  2008 2007  2008 2007   
  £000 £000  £000 £000  
    
Unsecured bank loan  54 -  - -  
Revolving credit facility (see note 19)  - 3,500  - -  
Other financial liabilities  92 3,782  - -  
Total  146 7,282  - -  
     
Issue costs  - (26) - (26)
Amortisation of issue costs  - 26  - 26  
Net book value  146 7,282  - -  
The issue costs have been amortised to zero since the term loan to which it relates has been repaid.
This note provides information about the contractual terms of the Group and Company’s interest bearing loans and borrowings for more 
information about the Group and Company’s exposure to interest rate and foreign currency risk see note 19.
Other financial liabilities of £92,000 relates to the balance of a rent free period (2007: £107,000) which is released to the income statement 
over the term of the lease. In the prior year, £3,675,000 related to deferred consideration on acquisitions.
19 Financial instruments 
Financial risk management
The Group has exposure to the followings risks from its use of financial instruments:
• Credit risk
• Liquidity risk
• Currency risk
• Interest rate risk
The Board has overall responsibility for establishing appropriate management of exposure to risk. The Audit Committee oversees how 
management identify and address risks to the Group. 
capital management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future 
development of the business. The Board monitors return on capital and the level of dividend to shareholders.
Financial instruments policy
All instruments utilised by the Company and Group are for financing purposes. The day-to-day financial management and treasury are 
controlled centrally for all operations. 
(continued)
NOTES
NCC Group annual report and accounts 2008
Paul Vlissidis
technical Director - securetest _61
19 Financial instruments (continued)
Fair value of financial instruments
As at 31 May 2008 the Group and Company had no other financial instruments than those disclosed below. The carrying value of all financial 
instruments in these financial statements represents their fair value. 
credit Risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations 
and arises principally from the Group’s receivables from customers. The Group’s exposure to credit risk is influenced mainly by the individual 
characteristics of each customer.
exposure to credit risk
The carrying value of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:
  Group Group  company Company  
  2008 2007  2008 2007   
  £000 £000  £000 £000  
      
Loans and receivables  10,235 5,792 - 235 
Cash and cash equivalents  1,142 4,377 12 12 
  11,377 10,169 12 247 
The maximum exposure to credit risk for trade receivables at the reporting date by geographic region was:
Debtors by geographical segment 
  Group Group  company Company  
  2008 2007  2008 2007   
  £000 £000  £000 £000  
      
UK  9,489 5,455 - 235 
Rest of Europe  464 36 - - 
Rest of the World  282 301 - - 
  10,235 5,792 - 235 
Recycled paper 62_
19 Financial instruments (continued)
The maximum exposure to credit risk at the reporting date by business segment was:
Debtors by business segment  Group Group  company Company 
  2008 2007  2008 2007   
  £000 £000  £000 £000  
      
Escrow Solutions  3,829 3,054 - - 
Escrow Europe  464 35 - - 
Escrow USA  282 301 - - 
Consultancy  1,922 1,294 - - 
Assurance Testing  3,738 1,108 - - 
Amounts owed by Group undertakings  - - - 235 
  10,235 5,792 - 235 
The trade receivables of the Group typically comprise of amounts due from a large number of small customers. The Group’s customer base, 
whilst concentrated largely in the UK, represents a spread of industry sectors. The largest amount due from a single customer at the reporting 
date represented 4% of total group receivables (2007: 2%). All of the Group’s cash is held with financial institutions of high credit rating.
Impairment losses
The ageing of trade receivables at the reporting date was: 
  Group Group  company Company  
  2008 2007  2008 2007   
  £000 £000  £000 £000  
      
Not past due  5,210 3,171 - - 
Past due 0-30 days  2,640 1,465 - - 
Past due 31-90 days  2,310 1,092 - - 
Past due more than 90 days but less than one year  346 180 - - 
  10,506 5,908 - - 
(continued)
NOTES
NCC Group annual report and accounts 2008
Rob Pope
technical Director - securetest _63
19 Financial instruments (continued)
The movement in the allowance in respect of trade receivables during the year was as follows:
     Group Group 
     2008 2007 
     £000 £000 
Balance at 1st June     116 34
Impairment loss recognised     155 82
balance at 31st may     271 116
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of specific trade receivables. 
The allowance accounts in respect of trade receivables are used to record impairment losses unless the Group is satisfied that no recovery 
of the amounts owing is possible; at that point the amount is considered irrecoverable and is written off against the financial asset directly. 
The Group reviews all debt more than 90 days past due and provides for impairment losses, net of any revenue which has been deferred, 
based on trading experience with that customer. The ageing of Group debt and associated impairment loss is reported to the Board on a 
monthly basis.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group manages liquidity risks by 
regular reviews of forecast cash flows in line with contractual maturities of financial liabilities and Revolving Credit Facility available. Forecast 
cash flows are reporting to the Board on a monthly basis.
The following are the contractual maturities of financial liabilities, including interest payments of the Group:
 carrying contractual 6 months 6-12 1-2 2-3
At 31st may 2008 amount cash flows or less months years years
 £000 £000 £000 £000 £000 £000 
Unsecured bank borrowings 4,500 (4,524) (4,524) - - -  
Trade and other payables 11,270 (11,270) (11,270) - - -  
      
At 31st May 2007      
Unsecured bank borrowings 3,500 (3,522) -  - - (3,522)
Trade and other payables 3,931 (3,931) (3,931) - - -  
The financial liabilities of the Company all have contractual maturities within 6 months (2007: within 6 months).
Recycled paper 64_
19 Financial instruments (continued)
currency risk
The Group is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the respective 
functional currencies of the group entities. The Group’s management review the size and probable timing of settlement of all financial assets 
and liabilities denominated in foreign currencies. Where there is substantial exposure to currency risk, hedging arrangements are put in 
place. The Group’s exposure to currency risk is as follows:
  2008   2007   
 GbP eUR UsD GbP eUR UsD
 £000 £000 £000 £000 £000 £000
Loans and receivables 9,489 464 282 5,403 36 353
Cash and cash equivalents 331 271 539 4,214 71 92
      
Unsecured bank borrowings 4,500 - - 3,500 - -
Trade and other payables 10,491 749 30 3,781 40 110
      
Interest rate risk
The Group and Company finances its operations through a mixture of retained profits and bank borrowings. The Group borrows and invests 
surplus cash at floating rates of interest based upon bank base rate. 
The financial assets of the Group at the end of the financial year were as follows
     2008 2007
     £000 £000
Sterling denominated financial assets     618 4,253
Euro denominated financial assets     35 32
US dollar denominated financial assets     489 92
Current trade and other receivables     12,351 7,757
     13,493 12,134
The financial assets of the Company at the end of the financial year were as follows
     2008 2007
     £000 £000
Sterling denominated financial assets     12 12
     12 12
 
The financial liabilities of the Group and their maturity profile is as follows
     2008 2007
Maturity     £000 £000
Less than 1 year     4,500 -
1 to 2 years     - -
2 to 3 years     - 3,500
3 to 4 years     - -
Current trade and other payables     11,270 3,931
Sterling denominated financial liabilities     15,770 7,431
(continued)
NOTES
NCC Group annual report and accounts 2008
Rob quayle
Group It manager _65
19 Financial instruments (continued)
 
The financial liabilities of the Company and their maturity profile is as follows
    2008 2007
Maturity    £000 £000
Less than 1 year    - -
1 to 2 years    - -
2 to 3 years    - -
3 to 4 years    - -
Current trade and other payables    7,159 5,856
Sterling denominated financial liabilities    7,159 5,856
As at 31 May 2008 the Group had a committed unsecured revolving credit facility of £10 million (2007: £6.3 million). The interest payable on 
drawn down funds is 0.85% above Libor.
The revolving credit facility is available until July 2009. A change of 100 basis points in interest rates would not have a significant impact on 
these financial statements.
20 share based payments 
The company has a number of share option schemes under which options to subscribe for the Company’s shares have been granted to 
directors and staff, details of which are illustrated in the tables below. Expected term of options represents the period over which the fair value 
calculations are based.
Approved emI scheme
Under the Approved EMI Scheme, options granted will be subject to performance criteria. Options will vest if the average EPS growth for the 
3 years following their grant is greater than 3% above RPI per annum. The options are to be settled in equity.
Date of grant expected  exercisable exercise 2008 number
 term of options  between price outstanding  
July 2004 6 years July 2007 - July 2014 £1.70 165,073
July 2005 6 years July 2008 - July 2015 £2.565 13,644
July 2006 6 years July 2009 - July 2016 £2.70 9,259
August 2007 6 years July 2010 - July 2017 £3.85 335,855
February 2008 6 years July 2010 - July 2017 £3.89 47,252
Recycled paper 66_
20 share based payments (continued)
LtIP schemes
The vesting condition for the award of the July 2004 and October 2007 LTIP schemes is average growth of EBITA over the life of the LTIP . If 
average EBITA growth is above 25% the shares will vest fully. If growth is less than 10% no shares will vest and if the average EBITA growth is 
between 10% and 25% the shares vest on a straight line basis between the two percentages.
The vesting condition for the award of the other LTIP schemes is split 50:50 between Total Shareholder Return (TSR) & EPS. The TSR condition 
compares the Group’s TSR performance over the 3 year performance period with the TSR performance of the constituent companies of the 
FTSE software and computer services index. Where the Group’s TSR performance equates to median level in the comparator group, 30% of 
the award governed by the TSR condition will vest. 100% of the award governed by the TSR condition will vest for upper quartile performance 
or above. Between these two points, vesting will be determined on a straight line basis. 
The EPS condition governs the vesting of the remaining 50% of the LTIP award and relates to the growth in the Group’s EPS over the 
performance period. If growth is equal to 25% or more per annum then 100% of the award governed by the EPS condition will vest. If, 
however, growth is less than 10% per annum, none of the award governed by the EPS condition will vest. Between these two points, vesting 
is determined on a straight line basis. The options are to be settled in equity.
Date of grant expected  exercisable exercise 2008 number
 term of options  between price outstanding  
July 2005 3 years June 2008 - Sept 2009 nil* 230,389
July 2006 3 years June 2009 - June 2010 nil* 245,368
Sept 2006 3 years June 2009 - June 2010 nil* 53,180
Oct 2007 3 years June 2010 - June 2011 nil* 316,662
*The option exercise price is nil however £1 is payable on each occasion of exercise.
sharesave scheme
The company operates a Sharesave scheme, which is available to all employees and full time Executive Directors of the Company and its 
subsidiaries who have worked for a qualifying period. All options are to be settled by equity.
Under the scheme the following options have been granted and are outstanding at year end.
Date of grant expected  exercisable exercise 2008 number
 term of options between price outstanding  
July 2005 3.25 years September 2008 - February 2009 £2.07 29,422
August 2006 3.25 years September 2009 - February 2010 £2.16 22,844
August 2007 3.25 years September 2010 - February 2011 £3.24 179,992
(continued)
NOTES
NCC Group annual report and accounts 2008
shelley edmondson
Group Financial controller _67
20 share based payments (continued)
The following tables illustrate the number of share options for the schemes.
 number of Instruments options Forfeitures number of
 instruments as  granted during exercised in in the year instruments as
scheme at 1 June 2006 the year the year  at 31 may 2007
Approved EMI scheme  964,412 - (7,572) (62,699) 894,141
Approved EMI scheme  42,882 - -  (29,238) 13,644
Approved EMI scheme - 9,259 -  -  9,259
Sharesave scheme 291,803 - (2,212) (13,114) 276,477
Sharesave scheme 49,771 - -  (12,793) 36,978
Sharesave scheme - 28,901 -  (4,321) 24,580
LTIP 169,118 - -  -  169,118
LTIP 261,761 - -  -  261,761
LTIP - 280,553 -  -  280,553
LTIP - 53,180 -  -  53,180
The weighted average share price at the time the share options were exercised in the year was £2.58. The weighted average share price at 
the time the share price was forfeited in the year was £2.81. 
 number of Instruments options Forfeitures number of
 instruments as  granted during exercised in in the year instruments as
scheme at 1 June 2006 the year the year  at 31 may 2007
Approved EMI scheme  894,141 - (729,068) -  165,073
Approved EMI scheme  13,644 - -  -  13,644
Approved EMI scheme 9,259 - -  -  9,259
Approved EMI scheme - 367,560 -  (31,705) 335,855
Approved EMI scheme - 49,117 -  (1,865) 47,252
Sharesave scheme 276,477 - (274,405) (2,072) -
Sharesave scheme 36,978 - (1,998) (5,558) 29,422
Sharesave scheme 24,580 - -  (1,736) 22,844
Sharesave scheme - 218,389 -  (38,397) 179,992
LTIP 169,118 - (147,831) (21,287) -
LTIP 261,761 - -  (31,372) 230,389
LTIP 280,553 - -  (35,185) 245,368
LTIP 53,180 - -  -  53,180
LTIP - 316,662 -  -  316,662
The weighted average share price at the time the share options were exercised in the year was £3.63.
The weighted average share price at the time the share options were forfeited in the year was £3.75.
The fair value of services received in return for share options is calculated with reference to the fair value of the award on the date of grant. 
The fair value is spread over the period during which the employee becomes unconditionally entitled to the award, adjusted to reflect actual 
and expected levels of vesting. Black-Scholes, Binomial and Monte Carlo simulation models have been used to calculate the fair values of 
options on their grant date for all options issued after 7 November 2002 which had not vested by 1 January 2005.
Recycled paper 68_
20 share based payments (continued)
The assumptions used in the model are illustrated in the table below:
  Fair value at   option Risk-free
 Grant  measurement exercise expected expected interest
 date date price volatility term rate
EMI Jul-04 £0.66 £1.70 44% 6 Years 5.09%
EMI Jul-05 £1.07 £2.57 40% 6 Years 5.09%
EMI Jul-06 £0.78 £2.70 25% 6 Years 4.75%
EMI Aug-07 £1.19 £3.85 25% 6 Years 6.00%
EMI Feb-08 £1.27 £3.89 25% 6 Years 6.00%
SAYE Jul-04 £0.68 £1.36 44% 3.25 Years 5.06%
SAYE Jul-05 £1.00 £2.07 40% 3.25 Years 5.06%
SAYE Aug-06 £0.81 £2.16 25% 3.25 Years 4.76%
SAYE Sept-07 £1.13 £3.24 25% 3.25 Years 6.00%
LTIP Jul-04 £1.59 £nil* 44% 3 Years 5.01%
LTIP Sep-05 £1.87 £nil* 40% 3 Years 5.01%
LTIP Sep-05 £2.27 £nil* 40% 3 Years 5.01%
LTIP Jul-06 £2.21 £nil* 25% 3 Years 4.79%
LTIP Sep-06 £1.80 £nil* 25% 3 Years 4.79%
LTIP Oct-07 £3.58 £nil* 25% 3 Years 6.00%
* The option exercise price is nil however £1 is payable on each occasion of exercise.
The expected volatility is based on the historical volatility, adjusted for any expected changes to future volatility due to publicly available 
information. For the options granted in the year ending 31 May 2008, dividend yield assumed at the time of option grant is 1.3% (2007: 
1.6%). For other option schemes, dividend yield assumed at the time of option grant was 2.3%.
A charge of £934,000 (2007: £575,000) has been made to cost of sales in the Group income statement in respect of share based payment 
transactions, including £192,000 of provision for National Insurance contributions. A charge of £270,000 (2007: £169,000) has been made 
to cost of sales in the Company income statement in respect of share based payment transactions. 
(continued)
NOTES
NCC Group annual report and accounts 2008
mark turner
managing consultant - securet est _69
21 called up share capital
   number  
   of shares 2008 2007
    £000 £000 
Authorised     
Ordinary shares of 1p each   50,000,000 500 500
    500 500
     
Allotted, called up and fully paid     
Ordinary shares of 1p each at the beginning of the year   32,613,969 326 326
Ordinary shares of 1p each issued in the year   1,005,471 10 -
Ordinary shares of 1p each at the end of the year   33,619,440 336 326
During the year 1,005,471 shares were issued for total consideration of £1,618,000 settled in cash. 
22 cash and cash equivalents
  At beginning Cash flow Non cash At end of
  of year  items year
  £000 £000 £000  £000
 
Cash and cash equivalents per balance sheet  4,377 (3,207) (28) 1,142
cash and cash equivalents per cash flow statement  4,377 (3,207) (28) 1,142
Recycled paper Recycled paper 70_
23 other financial commitments and contingent liabilities
 
a) Capital commitments at the end of the financial year, for which no provision has been made, are as follows:
    2008 2007
    £000 £000
 
Contracted    57 350
b) Non-cancellable operating lease rentals are payable as follows:
   2008                2007               
             Land and  Land and 
  buildings other buildings Other
  £000 £000 £000 £000
     
Within 1 year  84 104 14 66
In second to fifth year inclusive  569 132 499 191
  653 236 513 257
There are no contingent liabilities not provided for at the end of the financial year.
24 Pension scheme
The Group operates a defined contribution pension scheme that is open to all eligible employees. The pension cost charge for the year 
represents contributions payable by the Group to the fund and amounted to £324,000 (2007: £257,000). The outstanding contributions at 
the year end were £46,870 (2007: £42,240). 
For the Company, the pension cost charge for the year represents contributions payable by the Company to the fund and amounted to 
£32,000 (2007: £26,000). 
25 Related party transactions 
The Group and Company’s transactions with directors are disclosed in the Directors’ Remuneration Report.
NCC Group’s Non Executive chairman Paul Mitchell is a director of Rickitt Mitchell and Partners Limited and the Group conducted business to 
the value of £236,000 (2007 : £239,000) with Rickitt Mitchell and Partners Limited. Included within the charge is £178,000 relating to advice 
received in connection with acquisitions made during the year ended 31 May 2008. The remaining £58,000 relates to the services of the 
Non Executive Chairman. Rickitt Mitchell and Partners Limited also held 7,000 1.0p ordinary shares (2007: 7,000).
(continued)
NOTES
NCC Group annual report and accounts 2008
nathan Jackson
technical Director - consultancy _71
26 Fixed asset investments
     shares in group
      undertakings 
     (restated)
company     £000
  
At 1st June 2006     29,145
Increase in subsidiary investment for share based charges     405
At 31st May 2007     29,550
At 1st June 2007     29,550
Increase in subsidiary investment for share based charges     444
At 31st may 2008     29,994
During the year, the Company adopted IFRIC 11 resulting in a prior year adjustment of £405,000 as shown above. The cost represents 
the cost of acquiring the whole of the issued share capital of NCC Group (Solutions) Limited and its subsidiary undertakings. Fixed asset 
investments are recognised at cost. The principal undertakings in which the Company’s interest at the year end is 100% are as follows:
subsidiary undertakings country of incorporation Principal activity
NCC Group (Solutions) Limited England and Wales Escrow Solutions & Consultancy services
NCC Services Limited  England and Wales Escrow Solutions & Consultancy services
NCC Escrow International Limited England and Wales Dormant
NCC Group Inc USA Escrow Solutions
NCC Group Employee’s Trustees Limited England and Wales Employee Benefit Trust
NCC Group GmbH Germany Escrow Solutions
Escrow 4 Software Limited England and Wales Dormant
Site Confidence Limited England and Wales Internet monitoring & load testing
Secure Test Limited England and Wales Ethical Security Testing
Escrow Europe Holdings B.V. Netherlands Escrow Solutions
Escrow Europe B.V. Netherlands Escrow Solutions
Escrow Industrial B.V. Netherlands Dormant
The principal undertakings in which the Company’s interest at the year end is less than 100% are as follows:
 
 Interest country of incorporation  Principal Activity 
Escrow Europe (Deustchland) GmbH 90% Germany Escrow Solutions
Escrow Europe N.V. 25% Belgium Escrow Solutions
Escrow Europe (Israel) Limited 25% Israel Escrow Solutions
Escrow Europe (Pty) Limited 25% South Africa Escrow Solutions
Deposit A.B. 25% Sweden Escrow Solutions
Escrow Europe (Switzerland) A.G. 24% Switzerland Escrow Solutions
  
Recycled paper
nathan Jackson
technical Director - consultancy 72_
comPAny InFoRmA tIon
Directors
Paul Mitchell – Non Executive Chairman
Rob Cotton – Chief Executive
Paul Edwards – Finance Director
James Wallace – Senior Non Executive Director
Eurfyl ap Gwilym – Non Executive Director
secretary
Felicity Brandwood
Registered office
Manchester Technology Centre
Oxford Road
Manchester M1 7EF
Registered number
4627044
brokers and corporate finance advisers
Dresdner Kleinwort Limited
PO Box 52715
30 Gresham Street
London EC2P 2XV
corporate finance advisers
Rickitt Mitchell & Partners Limited
Clarence House
Clarence Street
Manchester M2 4DW
Auditors
KPMG Audit plc
St James’ Square
Manchester M2 6DS
solicitors
Eversheds LLP
70 Great Bridgewater Street
Manchester
M1 5ES
bankers
Barclays Bank plc
7th Floor 1 Marsden Street
Manchester M2 1 HW
Registrars
Equiniti
Aspect House
Spencer Road
Lancing
West Sussex BN99 6DA
72_ NCC Group annual report and accounts 2008 _73
cont Act Us
UK offices
Head office
Manchester Technology Centre
Oxford Road
Manchester
M1 7EF
United Kingdom
Phone: +44 (0) 161 209 5200
Fax: +44 (0) 161 209 5100
e-mail: response@nccgroup.com
London office
Floor 4 
Tavistock House North
London
WC1H 9HR
Phone: +44 (0) 207 383 9170
Fax: +44 (0) 207 383 9179
Dorking office
St Martins House
St Martins Walk
Dorking
Surrey
RH4 1UW
Phone: +44 (0) 870 850 8520
Fax: +44 (0) 870 850 8521
e-mail: information@siteconfidence.com
thame office
Eastern Bypass
Thame
Oxfordshire
OX9 3FF
United Kingdom
Phone: +44 (0) 1844 210 300
Fax: +44 (0) 8709 908 423
e-mail: enquiries@securetest.com
european offices
Amsterdam office
Herengracht 414 
1017 BZ Amsterdam 
Phone: +31 (0)20 620 7151 
Fax: +31 (0)20 420 1733 
e-mail: info@escroweurope.com
munich office
Heimeranstrasse 37
D-80339 Munchen
Germany
Phone: +49 (0) 89 599 7620
Fax: +49 (0) 89 599 762 599
e-mail: europe@nccgroup.com
north American office
UsA office
1731 Technology Drive
Suite 880
San Jose
CA 95110
Phone: +1 (408) 441 4660
Fax: +1 (408) 441 4658
e-mail: usa@nccgroup.com
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