Annual Report 2005
Annual Report 2005                                                                                                                                                                                                   AVEVA CONTENTS
01 Highlights 
02 Group Overview
04 Chairman’s Statement
06 Chief Executive’s Review
18 Financial Review
20 Board of Directors
21 Directors’ Report 
24 Corporate Govenance Statement
26 Directors’ Remuneration Report
32 Statement of Directors’ Responsibilities
33 Auditors’ Report 
35 Consolidated Profit and Loss Account 
35 Consolidated Statement of Total 
Recognised Gains and Losses 
36 Consolidated Balance Sheet
37 Company Balance Sheet
38 Consolidated Cash Flow Statement
39 Notes to the Financial Statements
63 Five Year Record
64 Company Information and Advisors
64 Global Locations AVEVA Annual Report 2005 Highlights 01
HIGHLIGHTS
£57.5m
TURNOVER (£m)
2005
2004
2003
2002
2001
57.5
38.1
36.0
31.8
28.1
2005
2004
2003
2002
2001
10.7
6.7
6.2
5.6
5.8
2005
2004
2003
2002
2001
36.7
26.2
25.1
23.6
24.4
2005
2004
2003
2002
2001
6.1
5.8
5.6
5.4
5.4
£10.7m
PROFIT BEFORE TAX, AMORTISATION OF INTANGIBLE 
ASSETS AND EXCEPTIONAL ITEMS (£m)
• Record results with increased revenue, profits before goodwill and cash
• Revenues up 51% to £57.5 million (2004 - £38.1 million), with recurring revenues up 42% to £32.6 million 
• Profit before tax, exceptional restructuring costs and goodwill £10.7 million (2004 - £6.7 million) an increase of 60%
• Adjusted earnings per share of 36.7p (2004 - 26.2p)
• Basic earnings per share of 13.4p (2004 - 22.4p)
• Strong cash generation with net cash at year-end at £11.2m (2004 - £8.7m)
• Increased final dividend of 4.3p proposed, bringing the total dividend to 6.1p (2004 - 5.8p)
• Excellent growth in target sectors of oil and gas, power and marine, with notable success in the Asia Pacific region
• Successful integration of marine business, Tribon. Performance and synergy benefits ahead of expectations, 
with full year cost savings at £3.3 million
• Exciting opportunity for acceleration of VNET business with additional investment of £2m in the next 
twelve months and the strategic acquisition of Realitywave, Inc. for £3.2m
36.7p
ADJUSTED EARNINGS PER SHARE (pence)
6.1p
TOTAL DIVIDENDS PER SHARE (pence) AVEVA Annual Report 2005 Group Overview 02
AVEVA Group plc is one of the world’s foremost and fastest growing lifecycle engineering 
IT solutions and services providers to the oil and gas, power, marine, paper and pulp, chemical
and pharmaceutical industries. Listed on the London Stock Exchange (LSE: AVV) since 1996, 
the Group reported adjusted pre tax profits for the year ending 31st March 2005 of GBP £10.7
million on a turnover of £57.5 million, a growth in profits of 60% and growth in turnover of
51%. During the year the company have successfully integrated the world’s leading
shipbuilding design solution, Tribon Solutions AB. The addition of Tribon adds considerable
domain expertise, technology and customer base to AVEVA as well as enhancing AVEVA’s global
presence with additional offices in China, Russia and Sweden. AVEVA is now the world 
number one for commercial ship design solutions. AVEVA’s core technology has been 
further strengthened with the acquisition of Realtywave, to secure and enhance the new 
VNET product, which will benefit from continued investment for strong future growth.
Oil and gas remains one of the most significant global industries in 
the world today, feeding the power industry, polymers, chemicals,
transportation, pharmaceuticals and much more. In fact, it is hard to
name a part of modern life that isn't touched in some way by the
extraction and processing of oil and gas. AVEVA was the first company 
to introduce 3D modelling to the offshore industry and has since become
synonymous with it. In the UK sector of the North Sea alone, 5.2 million
barrels per day are produced from topsides worth nearly £20 billion
designed using AVEVA's technology. The engineering IT revolution began
in the offshore industry and it began with AVEVA.
Prior to the acquisition of Tribon Solutions, AVEVA's PDMS solution was a
platform of choice for the outfitting of commercial and process vessels.
Every day, a ship of over 1,500 tonnes is launched that was designed
using AVEVA's technology. The heyday of mammoth, static oil platforms is
all but over and the world is looking to Floating Production, Storage and
Offloading (FPSO) vessels and other floating facilities for the future of oil
production. There is an estimated current requirement for 110 of these
huge, mobile plants. They are a fusion of shipbuilding and plant
technology, requiring an integration of both technologies. No other
solution provider has the experience, history or proven technology to
match this need.
£57.5m
TURNOVER
£38.5m
GROSS PROFIT
GROUP OVERVIEW
MARINE OIL AND GAS AVEVA Annual Report 2005 Group Overview 03
In 1967, before the dawn of the IT revolution, the British
Government asked a department of the University of Cambridge 
to do one thing: to take the emerging computer technology 
and use it to make engineering better.
As the world woke up and ran in different directions, the
department became a company. It watched, it thought and 
it developed. It realised that the creation, sharing and protection 
of engineering information was the single most important factor 
in projects and asset management. It followed that information
should be able to travel freely, that tasks were more important 
than tools, and that the boundaries of engineering execution 
could be crossed if they were understood.
In the longest history of any solution provider, AVEVA has 
delivered a design system that has evolved through every 
change that the IT revolution has thrown at it, protecting its
customers' valuable information and remaining compatible with 
even the earliest of their projects. It has built a steadfast
reputation in every sector of the process, power and marine
industries to become the most successful solution provider 
in the world. But, most of all, AVEVA has not forgotten what 
it was asked to do back in 1967. 
AVEVA is here because engineering is here.
AVEVA have continued to gain market share in our target sectors and across geographies, particularly in the Asia Pacific region.
Breakdown of Group revenue:
ASIA PACIFIC
£20.3m £27.9m £9.3m
As the world's human population makes its way towards the seven billion
figure, the need for new energy to power, homes, businesses, cities and
industries is rising at a staggering rate. The current estimation of the
need for new generation equates to over three hundred large new power
stations per year. China is the world's fastest growing industrial nation,
currently using almost six million barrels of oil a day just to fuel its
industrial growth. The power industry is another stronghold for AVEVA,
not only enjoying a market dominance in the Far East, but having had
its complete suite of solutions selected for Europe's first new nuclear
power station in ten years.
GEOGRAPHIC OPERATIONS
ENGINEERING IS HERE
EMEA
49% 35%
AMERICAS
16%
Alongside its main markets of Oil and Gas, Power and Marine, AVEVA
has had a successful year in some of its ancillary industry sectors, in
particular the activities in mining, with significant wins in Australia
as the AVEVA local office there starts to make an impact on this
market. Activities have continued in the Pharmaceutical and Food
Processing Industries and whilst these have grown less strongly than
other sectors the Paper and Pulp industry has been strong, with
AVEVA present in the top five of the world scale producers. Our
integrated product solution continues to penetrate all areas of the
process industry and dominate in our major sectors.
POWER OTHER INDUSTRIES AVEVA has made excellent progress 
this past year, achieving record levels 
of turnover, profit and cash.
Our continued strong performance reflects
AVEVA’s dominant position in growth
markets, leading innovative technologies
and an infrastructure geared towards
expanding and maintaining relationships
with blue chip customers across the globe.
We look to the future with confidence and
are particularly excited by the prospects
for VNET.
Turnover for the year increased by
51%
AVEVA Annual Report 2005 Chairman’s Statement 04
CHAIRMAN’S STATEMENT During the year under review we saw a
healthy increase in demand for our VANTAGE
solutions in all our major target sectors of
oil and gas, power and marine. Our marine
business (Tribon), acquired at the beginning
of the year, performed ahead of plan and
has benefited from a smooth integration
into the enlarged group. Its success has
contributed to a particularly outstanding
performance in the Asia Pacific region. 
KEY FINANCIALS 
Turnover for the year increased by 51% to
£57.5 million (2004 - £38.1 million). In
terms of organic growth (excluding Tribon),
turnover increased by a very commendable
15% to £43.7 million. Recurring revenues
increased by 42% to £32.6 million (2004 -
£23 million). Recurring revenues excluding
Tribon amounted to £25.7 million, an actual
increase of 14% when using consistent
exchange rates.
Following the acquisition of Tribon in 
May 2004 and as highlighted at last year’s
preliminary results, an exceptional charge of
£2.3 million has been expensed this year in
order to facilitate a smooth integration of
the business. I am delighted to report that 
the restructuring of the enlarged group has
resulted in full year savings ahead of initial
expectations at £3.3 million. 
As a result of the acquisition, goodwill 
and intangible amortisation for the year 
was £2.7 million (2004 - £0.6 million). 
Profit before tax, exceptional restructuring
costs and goodwill amortisation increased
by 60% to £10.7 million (2004 - £6.7
million), generating adjusted earnings 
per share of 36.7p (2004 - 26.2p) 
– an increase of 40%.
AVEVA continued to be strongly cash
generative with net cash as of the year-end
at £11.2 million (2004 - £8.7 million). 
DIVIDEND
Following another excellent year and
ongoing confidence in the outlook for
AVEVA, the Board is proposing an increased
final dividend of 4.3p per share (2004 -
4.0p). Together with the interim dividend 
of 1.8p, this gives a full year dividend 
of 6.1p (2004 - 5.8p).
Subject to final approval at the Annual
General Meeting, the final dividend will 
be paid on 1 August 2005 to shareholders
on the register at 1 July 2005. 
INTERNATIONAL FINANCIAL REPORTING
STANDARDS (“IFRS”)
Preparations continue for the introduction
of the International Financial Reporting
Standards that will first impact the group’s
interim statement for the six months to 
30 September 2005. The group will advise
its shareholders on any changes in advance
of its half-year statement.
PROSPECTS
The successful integration of Tribon and 
the subsequent restructuring of the enlarged
group, has undoubtedly enhanced AVEVA’s
leading position in the engineering data
and IT markets. Our exposure to high
growth, dynamic market economies such 
as China and Korea, leadership in key target
sectors, strong blue chip client partnerships,
innovative approach and greater global
scale and reach, give me confidence that 
we are well positioned to deliver further
turnover and profit growth, and ultimately,
shareholder value. In the current year the
investment required to exploit the exciting
opportunity within VNET will affect
profitability, however we are confident 
of a significant return on this investment
from the next financial year.
AVEVA Annual Report 2005 Chairman’s Statement 05
RICHARD A KING CBE
Chairman
18 May 2005 AVEVA Annual Report 2005 Chief Executive’s Review 06
This year has been
characterised by
excellent growth,
record financial
results and corporate
development to
further strengthen
our strategic position.
CHIEF EXECUTIVE’S REVIEW
Adjusted net profit before tax of
£10.7m
up 60% from 2004 AVEVA Annual Report 2005 Chief Executive’s Review 07
The acquisition of Tribon in May 2004
transformed AVEVA’s presence in the fast
growing marine market and further exposed
the business to some of the world’s most
dynamic economies in the Asia Pacific region.
This year could prove to be equally exciting,
as we increase the roll out of our unique
VANTAGE Enterprise NET (“VNET”) to a 
wider customer base and begin to reap 
the benefits of bringing together Tribon
technology with AVEVA’s core VANTAGE offer. 
DELIVERING ’A COMPLETE SOLUTION’
For four decades, AVEVA has been delivering
industry leading solutions to some of the
world’s largest full service engineering,
procurement and contracting (EPCs)
companies, playing a vital role in bringing
engineering projects to safe, early, cost
effective completion. However over the 
last three years, traditional EPC customers
and more specifically owner operators, are
increasingly demanding vendors to be able
to co-ordinate multiple products and provide
engineering data in a neutral format for
ongoing maintenance and operations. 
With this in mind, we developed our VNET
product. Launched in 2003, VNET now has 
a proven track record of acceptance within
our customer base and is helping improve
efficiencies in some of the largest capital
projects in the world.
VNET AND STRATEGIC 
ACQUISITION OF REALITYWAVE
Historically there have been integration
problems in the handover of a project from
an EPC to an owner operator. VNET is an
innovative technology application that
enables integration and collaboration
between users of engineering information
through an internet based portal, regardless
of its format and without the customer
requiring to licence expensive and complex
authoring applications. The response from
customers to date has been very positive. 
To support the development of this
opportunity we have acquired Realitywave
for £3.2 million. Realitywave’s patented
technology is a critical component in our
VNET offering. The technology allows users
to efficiently access and manipulate large
amounts of information (be it data or
designs) by way of a unique streaming
technology. This acquisition supports
existing business requirements and 
secures a key technology as we develop 
this capability.
VNET is now ready for a wider customer 
roll out. In order to maximise the
opportunity for growth, we intend to 
invest an additional £2 million over and
above our current commitments during the
next twelve months in strengthening
solution integrators and recruiting
additional sales people. Whilst this will
constrain earnings growth in the short term,
it represents a significant opportunity to
accelerate profitability in future years. AVEVA Annual Report 2005 Chief Executive’s Review 08
CHIEF EXECUTIVE’S REVIEW CONTINUED
80%
of the top 20 shipbuilders
use AVEVA's solutions AVEVA Annual Report 2005 Chief Executive’s Review 09
SECTOR FOCUS
The enlarged group targets three main
markets which contribute broadly similar
proportions of revenue (oil and gas,
marine and power), amounting to 85% 
of the overall business. Our performance
in these three markets has been very
strong with a good inflow of new
business and renewal of rental contracts.
Our reputation for excellence and ability
to deliver a ‘complete solution’ provides
us with a good platform to grow our
business in all three of our core markets.
Marine: The marine business (Tribon), 
a new market for AVEVA, has performed
ahead of expectations this year generating
revenues of £14 million. As the Chairman
has already stated, the synergy benefits 
of bringing the two businesses together
under the AVEVA brand and its overall
performance, have exceeded expectations. 
Tribon is the world’s leading provider of
marine design solutions and specialises
in hull design. Over 80% of the world’s top
twenty shipbuilders currently use Tribon and 
we are finding that AVEVA’s existing core
technology is hugely complementary to
Tribon’s own product suite. This bringing
together of the two technologies is
progressing to plan and we believe it 
will lead to improved functionality, and 
in turn, increased sales.
Recurring revenues have also increased 
as our customers become more aware of 
the enhanced offer. This is demonstrated 
by a new contract signed in the latter half
of the year with Daewoo. In December we
entered into a strategic development
partnership with Hyundai, the world’s
largest shipbuilder. Under the partnership
agreement, Hyundai has collaborated with
AVEVA in the development of the next
generation of VANTAGE Marine, committing
US$8 million to development costs, on top
of paying annual rental fees, initially to
2011. We have been excited by the progress
so far, and I am pleased to report that
Hyundai have started to use AVEVA products
well before they originally intended. This
endorsement from the world’s most
influential shipbuilder demonstrates that
our own VANTAGE technology is not only
highly complementary to the marine
industry, but is increasingly becoming
viewed as ‘must have’. We are positive that
this will lead to significant new business
opportunities during the course of this year.
Whilst we have secured some significant
new contracts in our non-core markets of
paper and pulp, mining, food processing,
chemical and pharmaceutical, these sectors
are not growing as strongly as AVEVA
business in oil and gas, power and marine.
Marine - keeping the 
mighty industry afloat
of the world's shipbuilding market is
occupied by Hyundai Heavy Industries -
AVEVA's customer and development partner
33%
of all global ship design and production
is powered by AVEVA's solutions
Over
15% Oil and Gas - the essence
of modern living
AVEVA Annual Report 2005 Chief Executive’s Review 10
Oil and Gas: turning to the oil and gas
sector, prior to the year-end we signed a
deal worth over US$1 million  with four
subsidiaries of the Sinopec Corporation to
provide a suite of VANTAGE products,
including PDMS. 
We have seen a steady increase in
confidence for long term oil and gas
projects around the world, particularly 
in the Asia Pacific region, and the Sinopec
deal outlined above and our investment 
in globalising our products to meet the
differing needs of customers, bodes well for
another excellent year. The World Floating
Production Report published in May 2005 
by energy business consultants Douglas-
Westwood, forecasts that the production of
floating offshore fields will almost double in
the next five years. We believe we can take
advantage of this potential new inflow of
business given that over the last ten years
80% of all new offshore projects have relied
on AVEVA solutions.
CHIEF EXECUTIVE’S REVIEW CONTINUED AVEVA Annual Report 2005 Chief Executive’s Review 11
80%
of all global offshore projects 
in the last decade have used
AVEVA's design solutions
50%
of the oil extracted from the UK 
North Sea in 2000 came from facilities
designed using AVEVA's solutions
50%
of the time taken to design a
major offshore facility in 1990 
is all it takes today with AVEVA AVEVA Ann Annu ual al Report 2005 Chief Executive’s Review 12
Power: A notable success for AVEVA has
been in China in the power industries, 
both nuclear and fossil fuelled. We now
dominate this market and work with 
over 75% of the country’s power design
institutes. China’s fast growing economy 
and the subsequent phenomenal demand 
for extra power capacity, should result in
further opportunities going forward. 
At the year-end we signed contracts
totalling US$0.3 million with the Dongfang
and Harbin Boiler companies, as well 
as the Shanghai Boiler Works. AVEVA is 
now effectively the biggest provider of
engineering IT solutions to the £1billion
Chinese industrial boiler market. All three
companies purchased our flagship product,
VANTAGE PDMS, with Harbin Boiler Works
also investing in other integrated 
AVEVA solutions. 
CHIEF EXECUTIVE’S REVIEW CONTINUED
Power - the industry, 
the lights and the magic AVEVA Annual Report 2005 Chief Executive’s Review 13
75%
of the regional, provincial and nuclear power
design institutes in China use AVEVA's solutions
All of the major industrial boiler manufacturers
in China have chosen AVEVA's solutions PERFORMANCE AND SALES
We have continued to gain market share in
our target sectors and across geographies,
particularly in the Asia Pacific region. 
GEOGRAPHIC REVIEW
Asia Pacific – 35% of group revenue:
£20.3 million (2004 - £8.7 million)
The migration of engineering design and
major contracts away from more traditional
markets toward the emerging economies of
the Far East has continued again this year.
We were particularly pleased with our
performance in China, Korea and Japan.
AVEVA’s successful penetration of Asian
Pacific markets stems from the investment
we have made in the region over the last
few years and is largely a result of three
factors. Firstly, an unrivalled network of
over ten offices throughout nine countries
including China, Japan, Korea, Malaysia and
Australia. Secondly, a highly experienced
and culturally astute management team led
by Peter Finch. And finally, a better than
planned performance from our marine
business, Tribon.
In terms of organic growth, process (oil and
gas and power) revenues continued to
strengthen. As we roll out combined AVEVA
and Tribon solutions this year, we are
confident that we will be able to build on
our already dominant position in the marine
market in the region. Our success has been
highlighted by concluding the sale to four
subsidiaries of Sinopec, China’s largest
producer and marketer of oil products, 
the country’s leading supplier of major
petrochemical products and the second
largest crude oil producer.
EMEA – 49% of group revenue: 
£27.9 million (2004 - £19.5 million)
Organic revenues in the EMEA region were
up 19% on the prior year. Although the
market in Europe is mature and our growth
less pronounced than in Asia Pacific,
existing customers are taking up a broader
range of AVEVA products. This is in part 
a response to a growing demand amongst
customers, particularly in Central and
Southern Europe, to improve efficiency 
in engineering projects.
Growth in Europe is also being driven by a
demand for extra power capacity, which will
in turn lead to significant additional
investment in the energy infrastructure. We
are already seeing a pan European revival of
nuclear power, with the first new design of
a European pressurised reactor currently
being built in Finland. All AVEVA products
are being used extensively for the design.
Similar projects elsewhere on the continent
are expected this year and we hope to
benefit given our reputation for delivering
safe, cost effective and efficient solutions.
Our unique VNET offering also gives us a
platform through which to exploit more
diverse opportunities as they arise. 
In terms of the marine industry, there is 
a very healthy demand for shipbuilding
worldwide. Lack of capacity in the Asia
Pacific region is beginning to result in 
a re-emergence of European shipyards.
Americas – 16% of group revenue:
£9.3million (2004 - £9.1million at 
this year’s exchange rates)
The weakness of the US dollar impacted
revenues for the year and there is an
ongoing pressure on large contractors to
migrate projects away from the US in order
to utilise more inexpensive local resources.
Despite this, our aim is to strengthen our
position in a market where we see good
long-term prospects. 
A number of important new contracts in 
the oil and gas and chemical markets were
signed during the year.
AVEVA Annual Report 2005 Chief Executive’s Review 14
CHIEF EXECUTIVE’S REVIEW CONTINUED
Other industries showed
continued growth in 2005 AVEVA Annual Report 2005 Chief Executive’s Review 15 TECHNOLOGY AND PRODUCTS
AVEVA has a long and proud history 
of providing innovative and advanced
solutions. With the acquisition of both
Tribon and Realitywave, AVEVA has extended
its capability in the marine market and
added patented streaming technology. 
These additions will provide a broader set 
of applications now and the availability 
of new technology for future products.
At the heart of AVEVA’s VANTAGE solution
suite is its proven database technology, 
still regarded as the best in the industry. 
We have already proven the value of the
database in the future versions of marine
products, as our integration of marine and
process products have moved ahead much
faster than originally planned. Another
value at the core of our technology has
been our principle of providing customers
with an upgrade path to future products
wherever possible, maintaining their
investment in data and procedures. Whilst
we are committed to providing ‘best in
class’ applications and protecting our
valuable IPR, we also support openness in
our applications and have invested heavily
over the year in providing new tools for
data exchange.
Our unrivalled domain expertise has enabled
us to combine the application knowledge
built into our products over many years with
new technologies such as Microsoft.NET,
which is appearing across the range of
products delivering wide-ranging benefits
for customers. In order to introduce new
technology and bring products to market
faster, we have enhanced our technical
skills in Eastern Europe and India and we
expect to grow our outsourcing capacity
considerably over the coming years.
In order to maintain our competitiveness 
in product development we have introduced
‘best practice’, along with the industry
leading software methodology, to ensure 
our very high degree of quality assurance. 
Over the last few years we have been
working much more closely with partners,
with this being evidenced by the joint
development with AutoDesk. Recently 
we have been working very closely with 
a number of vendors in the field of laser
data capture, an area of great interest to
customers looking to capture information
from existing plants and rebuild data 
models in AVEVA products.
With an enlarged team and a broader
product set AVEVA has all the essentials in
place to build on its competitive advantage
and further strengthen its market position.
PEOPLE AND ORGANISATION
The most important factor behind both 
the growth this year and the thoroughly
professional way in which the Tribon
organisation has been combined within
AVEVA, has been the people. There is a
passion within the group to provide the
best solutions for our customers, to continue
our product evolution using innovative ideas
and new technologies to the best advantage
for our customers’ futures.
We have welcomed many new staff from
Tribon into the AVEVA organisation and new
domain knowledge of the marine market.
I would like to thank all AVEVA staff for an
excellent performance throughout the year.
THE FUTURE
Our unrivalled technology, leading
competitive position, global scale and
reach, focus on high growth key target
sectors and planned wider roll out of our
unique VNET product, combined with a
favourable environment where our main
competitor is forcing its customers into 
a technology refresh program, imbues 
me with confidence that we will make
significant progress again this year.
AVEVA Annual Report 2005 Chief Executive’s Review 16
CHIEF EXECUTIVE’S REVIEW CONTINUED
RICHARD LONGDON
Chief Executive
18 May 2005 The Directors recognise the increasing
importance of corporate social responsibility
and endeavour to take into account the
interests of the group’s stakeholders,
including its investors, employees,
customers, suppliers and business partners
when operating the business. The group
believes that having empowered and
responsible employees who display sound
judgment and awareness of the
consequences of their decisions or actions,
and who act in an ethical and responsible
way, is key to the success of the business.
EMPLOYEES
The group’s success depends on the quality
of the people it employs and seeks to
attract, train and develop talent from the
UK and overseas. The group places
considerable value on their involvement 
and aims to keep them informed of matters
affecting them as employees, which is
achieved through a variety of formal 
and informal means.
The group is committed to the principles 
of equal opportunity in all its employment
practices, policies and procedures. The
group does not tolerate any harassment or
discrimination. The group practices equal
treatment of all employees or potential
employees irrespective of their race, creed,
colour, sexual orientation, nationality,
ethnic origin, religion, disability, age,
gender or marital status. The equal
opportunities policy covers all permanent
and temporary employees, all job
applicants, agency staff, associates,
consultants and contractors. The group 
also endeavours to be honest and fair in 
its relationships with customers and
suppliers and to be a good corporate
citizen, respecting the laws of countries 
in which it operates.
The maternity leave and maternity pay
policy conforms to statutory requirements.
Flexible approaches to return to work after
maternity leave and part-time or non-
standard hours and work patterns are
considered where viable. The group has
adopted a paternity leave policy in line 
with UK legislation.
ENVIRONMENTAL POLICIES
The group’s operations consist of software
development and sales and administration
functions and therefore by their very nature
have a low environmental impact. The group
policy is to meet the relevant statutory
requirements and apply good environmental
practice. This includes minimising paper
consumption through use of electronic
media and recycling of paper, computer
equipment and toner cartridges.
HEALTH AND SAFETY
The group recognises its legal
responsibilities to ensure the well being,
safety and welfare of its employees and 
to maintain a safe and healthy working
environment for them and for visitors 
and sub-contractors while they are 
on AVEVA’s premises. The group has
appropriate systems in place which review
local and world wide policy.
AVEVA Annual Report 2005 Corporate social responsibilty report 17
CORPORATE SOCIAL RESPONSIBILTY REPORT AVEVA Annual Report 2005 Financial Review 18
ACQUISITIONS
Tribon Solutions AB (“Tribon”)
The group acquired Tribon on 19 May 2004 for
total cash and shares consideration of £20.3m
which resulted in goodwill of £23.9m arising.
Tribon develops, markets and supports software
solutions for use in the design and production
processes in the marine industry and is
headquartered in Sweden with offices in
Germany, India, Japan, Republic of Korea,
Russia, Singapore and the UK. Goodwill is
being amortised over ten years and the 
charge in the period was £2,065,000.
Realitywave Inc (“Realitywave”)
On 31 March 2005, the group acquired
Realitywave, a software development company
based in Boston, Massachusetts, USA for cash
consideration of £3.2m resulting in goodwill 
of £3.5m which is being amortised over five
years. The principal reason for the Realitywave
acquisition was its key technology which is a
fundamental part of the Vantage Enterprise Net
product. The profit and loss account does not
contain any trading results for Realitywave as
the acquisition closed on the last day of the
financial year.
RESULTS OF OPERATIONS
Turnover
Ongoing operations Revenue from ongoing
operations for the year was £43.7m (2004 -
£38.1m), an increase of 15% from 2004.
License fees were £12.7m in 2005 compared 
to £10.0m in 2004, an increase of 27%.
Recurring revenue for the year was £25.7m
(2004 - £23.0m) and accounted for 59% of
total revenue (2004 - 60%). Recurring revenue
actually increased by 14% when using
consistent exchange rates. 
Service revenue, which include training,
implementation and consulting fees was
£5.3m compared with £5.1m last year. 
T ribon operations The integration of the Tribon
group has gone extremely well and has
delivered revenue for the period from May
2004 to March 2005 of £13.8m which was
ahead of our initial expectations.
License fees were £5.5m and recurring revenue
for the year was £6.9m accounting for 50% of
total revenue. The percentage of recurring
revenue compared to total revenue for the
Tribon business is expected to increase as we
continue to migrate customers onto the group
standard licencing model where customers
have to pay for the continued right to use the
software.
Service revenue, which include training,
implementation and consulting fees was £1.4m.
GROSS MARGINS, OPERATING EXPENSES 
AND OPERATING PROFITS
Overall the group maintained its gross margins
at 67%. Operating expenses were £30.8m
(before exceptional items of £1.9m) compared
with £19.4m in 2004 reflecting the increased
size of the group’s operations following the
Tribon acquisition.
Operating profits were £10.8m compared with
£6.8m in 2004 before amortization of goodwill
and intangibles of £2.7m (2004 - £0.6m) and
exceptional items of £2.3m (2004 - £nil)
representing the successful integration of the
Tribon business and continued growth of the
ongoing operations.
Ongoing operations Gross margins dropped
slightly to 66% compared with 67% in 2004.
Operating expenses as a percentage of turnover
were maintained at 51% after charging
exceptional restructuring costs of £0.3m.
T ribon operations Gross margins in the Tribon
business for the period from May 2004 to
March 2005 were 71% although this is slightly
distorted by the fact that head office costs
such as those in the legal and contracting 
department are not separately identifiable
between the two business streams. 
Operating expenses for the period were £8.7m
before exceptional costs of £1.6m relating to
the restructuring as described below.
Group research and development Expenditure 
on research and development for the year was
£11.2m representing 19% of revenues of which
£7.7m was incurred by ongoing operations and
£3.5m was incurred by Tribon. This compares
with £6.9m or 18% of revenues in 2004. 
Group R&D spend in the year has principally
been on developing version 11.6 of Vantage
Plant Design, developing VNET, our internet
based application which allows integration 
of all common engineering products, and 
the development of the new Vantage Marine
product which is being strongly supported 
by the major contract won with Hyundai in
December 2004. Consistent with previous years,
all research and development expenditure is
expensed in the profit and loss account.
Headcount costs The largest single element of
operating expenses continues to be headcount
and the associated costs. Group staff costs in
the year were £23.2m compared to £16.2m in
2004, an increase of 43% representing the
additional employees the group now has
following the Tribon acquisition. The average
number of employees increased from 326 to
474 in the year.
E x ceptional item – restructuring costs
Following the acquisition of Tribon, the group
has undergone a restructuring of its operations
to integrate the Tribon business within
existing operations with a charge of £2.3m
recorded as an exceptional cost in the profit
and loss account in the year. The restructuring
will result in annualised savings of £3.3m to
the group. Of the total cost of £2.3m, £1.8m
related to headcount reductions principally in
Sweden in sales and administration and £0.2m
related to the restructuring of the regional
FINANCIAL REVIEW
The group results for the year show growth in revenue
of 51% from £38.1m to £57.5m and growth in profit
before tax (after adding back exceptional items and
goodwill) of 60% from £6.7m to £10.7m which reflects
the successful acquisition of Tribon Solutions AB and
continued growth of the ongoing operations. 
In addition, the group ended the year with a strong
net cash position of £11.2m (2004 - £8.7m). AVEVA Annual Report 2005 Financial Review 19
offices with synergies being achieved in most
locations where there was more than one office.
In addition, £0.2m has been incurred in legal
and professional costs in relation to the
restructuring of the statutory entities and
£0.1m relating to the write down of fixed
assets. During the year, statutory entities in the
USA and the UK were merged, and entities in
Japan and Korea are expected to be merged in
the first half of 2005/06. The savings achieved
are ahead of plan and the group is delighted
that the integration of Tribon has gone so well. 
GEOGRAPHICAL PERFORMANCE
The strongest performing region was Asia
Pacific which saw its turnover from ongoing
operations increase by 47% from £8.7m to
£12.8m and has also benefited most from the
acquisition of Tribon with revenue of £7.5m
from the marine business, reflecting the strong
growth in shipbuilding in the Far East.
The performance in Europe was steady with
revenue from ongoing operations increasing by
12% from £19.5m to £21.9m.
The Americas continue to struggle with the
US market remaining depressed and highly
competitive and its results continue to be
impacted by the weakening of the US Dollar.
There was also further evidence of a continued
shift of global projects from the US to other
areas such as Asia. 
The Chairman’s statement and the Chief
Executive’s review provide more details of the
group’s performance in the year.
TAXATION
The group tax charge for the year was £2.9m
(2004 - £2.2m) representing an effective tax
rate before amortization of goodwill and
intangible assets of 34% (2004 - 33%). One 
of the key factors influencing the actual tax
rate was the fact that goodwill of £2.3m is 
not tax deductible. The other key factor
impacting the effective tax rate was the
significant proportion of the profits earned 
by overseas subsidiaries, subject to higher
rates of tax, partially offset by the benefits 
of the tax credit on qualifying research and
development expenditure in the UK.
The group is continuing to restructure the
enlarged organisation such that tax losses
which were acquired as part of the Tribon 
and Realitywave acquisitions can be utilised 
in the future, subject to local tax regulations.
EARNINGS PER SHARE
Adjusted earnings per share (before exceptional
items and goodwill and intangible amortisation)
was 36.71p compared with 26.20p in 2004, an
increase of 40%. Basic earnings per share was
13.48p (2004 - 22.63p). The directors believe
that adjusted earnings per share provides a
more meaningful measurement of performance
of the underlying business.
DIVIDENDS
The Board recommends a final dividend of 4.3p
per ordinary share, resulting in a total dividend
per share for the year of 6.1p (2004 - 5.8p).
The final dividend will be paid on 1 August
2005 to shareholders on the register at the
close of business on 1 July 2005. The cost of
dividends paid and proposed in respect of the
financial year was £1.5m (2004 - £1.0m).
BALANCE SHEET
The group balance sheet continues to remain
strong with net assets increasing from £21.6m
to £43.6m at 31 March 2004. Trade debtors at
31 March 2005 were £22.5m compared with
£14.4m and deferred revenue was £11.2m
compared to £6.0m at 31 March 2004.
CASH FLOWS
Overall net cash balances increased by £2.5m
from £8.7m to £11.2m which is after the
acquisition of Realitywave for £3.2m and
exceptional costs paid of £1.5m. Cash flow for
the year from operating activities was £11.6m
(2004 - £7.9m) reflecting strong collection of
accounts receivable by the year end. Net capital
expenditure was £0.9m (2004 - £1.6m) which
was principally the renewal of computer
equipment, tax paid was £3.2m (2004 - £2.0m)
and equity dividends paid were £1.3m 
(2004 -£1.0m).
CAPITAL STRUCTURE AND TREASURY POLICY
In May 2004 the group raised £17.2m
(approximately £14.7m net of expenses),
pursuant to a Placing and Open Offer of
3,645,112 ordinary shares of 10p each in 
order to finance the acquisition of Tribon. 
In addition, 789,655 ordinary shares of 10p
each were issued to the vendors as part of the
consideration. The group paid £15.0m in cash
to acquire Tribon in addition to transaction
costs of £2.6m. The total number of ordinary
shares outstanding at 31 March 2005 was
22,036,617.
The acquisition of Realitywave for £3.2m was
financed from existing cash resources.
The group continues to finance its operations
through a combination of retained profits, new
equity and bank overdraft facilities. During the
year the group had an bank overdraft and
revolving loan facility of £6.0m in the UK and
approximately £2.3m (SEK 30m) in Sweden
which was utilised to manage short term
fluctuations in cash before remittances from
the overseas entities. Where considered surplus
to working capital requirements, the group
converts US Dollars and Euro balances into
Sterling on an ongoing basis. Cash is held 
on short term deposits with reputable banks 
to maintain a balance between accessibility 
to the funds and competitive rates of return.
The group treasury policy ensures that the
capital is not put at risk.
Approximately £52.0m (90%) of the group’s
turnover is generated outside the UK and is
invoiced in currencies other than sterling. 
The group enters into forward foreign currency
contracts to manage the currency risk where
material. The overseas subsidiaries trade in
their own currencies and that also acts as a
natural hedge against currency movements.
The group is also exposed to foreign currency
translation risk on the translation of its net
investment overseas into sterling. This is
managed to some extent by the overseas
subsidiaries incurring costs denominated in
their local currency. Further details of the
group’s financial instruments are provided in
note 17 to the financial statements.
INTERNATIONAL FINANCIAL REPORTING
STANDARDS (“IFRS”)
All listed companies in the European Union
have to report their consolidated results under
IFRS for accounting periods commencing on 
or after 1 January 2005. The group will prepare
its first consolidated financial statements in
accordance with IFRS for the year ending 
31 March 2006 together with the interim
statement for the six months ending 30
September 2005. Preparations for conversion
to IFRS are underway and the group expects to
be fully prepared for the introduction of IFRS.
PAUL TAYLOR
Finance Director
18 May 2005 BOARD OF DIRECTORS
AVEVA Annual Report 2005 Board of Directors 20
RICHARD KING CBE, AGED 75, NON-EXECUTIVE CHAIRMAN
Richard King joined AVEVA at the time of the management buyout negotiations and was
appointed Chairman at their conclusion in August 1994. Prior to that he held various senior
management positions in both Pye of Cambridge and Philips NV in the UK and overseas. 
In 1980 he created, out of Philips, Cambridge Electronic Industries, a group of some twenty-
five specialist companies. The group was listed on the London Stock Exchange (LSE) in 1982 
and he was CEO throughout the 1980's. Richard then turned his attention and interests to
the development of early stage technical companies, mostly in Cambridge. Three of these,
apart from AVEVA, where at various times he was Chairman, obtained LSE listings. He also
committed considerable time to public service appointments as a director or Governor of
Addenbrooke's Hospital; Anglia Polytechnic University and Eastern Arts and is currently
Deputy Chairman of Xaar plc; Chairman of Sentec Limited; governor of Norwich School of Art
and Design and a trustee of the East Anglian Air Ambulance Trust. He is an Emeritus Fellow
of Darwin College in the University of Cambridge.
RICHARD LONGDON, AGED 49, CHIEF EXECUTIVE
Richard Longdon received an engineering training in the defence industry then gained
experience in the project management of high value engineering projects. He moved into
sales and held a series of international sales and marketing positions. He joined AVEVA in
1984 and shortly afterwards was made marketing manager for the process products. In
January 1992 he relocated to Frankfurt where he was responsible for setting up and running
the group’s German office. He returned to the UK as part of the management buyout team 
in 1994 subsequently taking responsibility for the group’s worldwide sales and marketing
activities before being appointed Managing Director in May 1999. He took over as Group
Chief Executive in December 1999.
PAUL TAYLOR, FCCA, AGED 40, FINANCE DIRECTOR AND COMPANY SECRETARY
Paul Taylor is a Fellow of the Association of Chartered Certified Accountants and joined
AVEVA in 1989. He was heavily involved in the flotation process and has been responsible
for both UK accounting and the development of its overseas subsidiaries including adherence
to group standards. Between 1998 and 2001 Paul was also UK Director of Human Resources
and was appointed to the position of Finance Director and Company Secretary of AVEVA
Group plc on 1 March 2001. Prior to joining AVEVA, Paul originally trained within the
accountancy profession before moving to Philips Telecommunications (UK) where he was
responsible for the management accounts of its Public sectors division.
DAVID MANN, AGED 60, NON-EXECUTIVE DIRECTOR AND SENIOR INDEPENDENT DIRECTOR
David Mann was educated at Jesus College, Cambridge. He is Non-Executive Chairman of
Charteris plc, a business and IT management consultancy, which he established with some
colleagues in 1996 and was floated on AIM in 2000. He is also Non-Executive Chairman of
Flomerics Group plc (quoted on AIM) and Non-Executive Director of Room Solutions Limited.
Prior to setting up Charteris, he spent almost all his career with Logica plc where he became
head of worldwide operations, then Group Chief Executive and finally Deputy Chairman. He is
a Past President of the British Computer Society and a Past Master of the Worshipful
Company of Information Technologists in the City of London.
COLIN GARRETT, ACA, AGED 48, NON-EXECUTIVE DIRECTOR
Colin Garrett has spent the majority of his career in corporate finance. For the last 
five years he has been involved, in a non-executive capacity, with a number of companies
and management teams. Colin is a Non-Executive Director of Intec Business Colleges plc 
and Sentec Limited. He is also Non-Executive Chairman of 3G Comms Limited, ZBD Displays
Limited and Pelikon Limited. 
Richard King CBE
Richard Longdon
Paul Taylor
David Mann
Colin Garrett DIRECTORS’ REPORT
FOR THE YEAR ENDED 31 MARCH 2005
AVEVA Annual Report 2005 Directors’ report 21
The directors present their annual report on the affairs of the group together with the Financial statements and Auditors’ report for the year
ended 31 March 2005.
PRINCIPAL ACTIVITIES
The company is a holding company. The principal activities of the group are the marketing and development of computer software and
services for engineering and related solutions.
BUSINESS REVIEW
A review of the group’s operations during the year and its plans for the future is given in the Chairman’s and Chief Executive’s statements
and Financial review. 
The group made a profit for the year after taxation of £2,882,000 (2004 - £3,910,000). Sales were £57,543,000 (2004 - £38,113,000) with
overseas sales representing 90 % (2004 - 91%) of the business.
CREDITORS’ PAYMENT PRACTICE
It is the group’s policy that payments to suppliers are made in accordance with those terms and conditions agreed between the company and
its suppliers, provided that all trading terms and conditions have been complied with by the other party.
The company has no trade creditors (2004 – £nil).
RESULTS AND DIVIDENDS
The group results and dividends are as follows:
RESEARCH AND DEVELOPMENT
The group continues an active programme of research and development and all costs are expensed as incurred. The research and development
programme covers updating of and extension to the group's range of products.
INTELLECTUAL PROPERTY
The group owns intellectual property both in its software tools and the products derived from them. The directors consider such properties 
to be of significant value to the business. Intellectual property acquired is capitalised at cost but internally developed intellectual property
costs are written off as incurred.
£000
Group profit for the year after taxation 2,882
Dividends paid and proposed
- interim dividend paid of 1.8p per ordinary share (396)
- final dividend proposed of 4.3p per ordinary share (948)
- final dividend paid for 2004 in respect of additional shares issued (179)
Retained profit for the year 1,359 DIRECTORS’ REPORT CONTINUED
AVEVA Annual Report 2005 Directors’ report 22
DIRECTORS AND THEIR INTERESTS
The directors who served during the year under review are shown below:
• R A King (Chairman)
• C A Garrett
R Longdon
• D W Mann
P R Taylor
• Non-executive directors
The beneficial interests in the shares of the company of directors who held office at 31 March 2005 are as follows:
No changes took place in the interests of directors in the shares of the company between 31 March 2005 and 18 May 2005.
Directors’ share options are disclosed in the Directors’ remuneration report on page 26.
Resolutions will be submitted to the Annual General Meeting for the re-election of Richard King and David Mann. Brief biographical details of
those directors who are proposed for re-election appear on page 20.
OTHER SUBSTANTIAL SHAREHOLDINGS
On 20 May 2005, the company had been notified in accordance with sections 198 to 208 of the Companies Act 1985, of the following
interests in the ordinary share capital of the company:
2005 2004
10P ORDINARY 10P ORDINARY
SHARES SHARES
R A King 131,250 131,250
C A Garrett ––
R Longdon 380,476 380,476
D W Mann 17,800 17,800
P R Taylor 8,000 8,000
PERCENTAGE
NAME OF HOLDER NUMBER HELD
Nutraco Nominees Limited 1,598,724 7.25
Chase Nominees Limited 1,105,304 5.01
The Bank of New York (Nominees) Limited BIL ACCT 973,736 4.42
Chase Nominees Limited UBSGAMEQ Account 795,399 3.61
HSBC Global Custody Nominee (UK) Limited 775,000 3.52
Vidacos Nominees Limited SL031 ACCT 750,000 3.40
Vidacos Nominees Limited 729,609 3.31
BNY (OCS) Nominees Limited 727,668 3.30
Chase Nominees Limited SUTL Account 694,464 3.15
CHARITABLE DONATIONS
During the year the group made charitable donations totalling £11,098 (2004 - £5,403) of which £4,000 was paid to the Tsunami appeal and
£5,000 to the International Red Cross with the remainder paid to local charities. AVEVA Annual Report 2005 Directors’ report 23
AUTHORITIES TO ALLOT SHARES AND DISAPPLY PRE-EMPTION RIGHTS
Resolution 9 set out in the notice convening the Annual General Meeting contains authority for the directors to allot relevant securities until the
earlier of 14 October 2006 and the date of the next Annual General Meeting up to a maximum nominal amount of £734,673 (representing 33.33%
of the total issued ordinary share capital as at 26 May 2005. At that date, no treasury shares were held by the company.
Resolution 10 gives the directors the power to allot equity securities for cash pursuant to this authority, disapplying the pre-emption provisions
contained in Section 89(1) of the Companies Act 1985. This power is valid for the same period and is limited to the allotment of equity
securities up to a nominal amount of £110,201 (approximately 5% of the issued ordinary share capital at 26 May 2005) or in connection with a
rights issue or other pre-emptive offer.
The directors have no present intention of issuing further shares other than to satisfy the exercise of option holders’ rights under the company’s
share option schemes or long term incentive plan or in relation to any appropriate acquisition opportunities which may become available to 
the company.
This authority will also cover the sale of treasury shares for cash.
AUTHORITY TO REPURCHASE ORDINARY SHARES
Resolution 8 set out in the notice convening the Annual General Meeting gives authority to the company to purchase its own ordinary shares 
up to a maximum of 2,204,021 ordinary shares until the earlier of 14 October 2006 and the date of the next Annual General Meeting. 
This represents 10% of the ordinary shares in issue at 26 May 2005 and the company’s exercise of this authority is subject to the stated upper
and lower limits on the price payable which reflects the requirements of the UK Listing Authority. Shares will only be repurchased if earnings per
share are expected to be enhanced as a result and the directors believe it is in the best interests of shareholders generally. To the extent that
any shares so purchased are held in treasury, earnings per share will be enhanced until such time, if any, as such shares are resold
or transferred out of treasury.
The company has the choice of cancelling shares which have been repurchased or holding them as treasury shares (or a combination of both).
Treasury shares are essentially shares which have been repurchased by the company and which it is allowed to hold pending either reselling them
for cash, cancelling them or, if authorised, using them for the purposes of its employee share plans.
The directors believe that it is desirable for the company to have this choice. Holding the repurchased shares as treasury shares would give the
company the ability to reissue them quickly and cost effectively and would provide the company with additional flexibility in the management of
its capital base. No dividends will be paid on, and no voting rights will be exercised, in respect of treasury shares.
As at 26 May 2005 (being the latest practicable date prior to the publication of the notice of the Annual General Meeting), there were 504,900
outstanding options granted under all share option plans operated by the company which, if exercised, would represent 2.24% of the issued
ordinary share capital of the company. If this authority were exercised in full and the shares repurchased were to be cancelled, such options if
exercised would represent 2.54% of the issued ordinary share capital of the company.
AUDITORS
A resolution to reappoint Ernst & Young LLP as auditors for the ensuing year will be put to the members at the Annual General Meeting.
High Cross By order of the Board,
Madingley Road
Cambridge
CB3 0HB
18 May 2005
P R Taylor
Secretary CORPORATE GOVERNANCE STATEMENT 
AVEVA Annual Report 2005 Corporate governance statement 24
STATEMENT OF COMPLIANCE WITH THE CODE OF BEST PRACTICE
In July 2003 “The Combined Code on Corporate Governance” was published by the Financial Reporting Council and it became effective for
reporting periods beginning on or after 1 November 2003.
The board is committed to the principles of corporate governance contained in the Combined Code. The company has complied with the
provisions of Section 1 of the Code throughout the year except for the following matters:
•
A.7.2 Non-executive directors who served during the year do not have contracts of employment for a specific term due to their 
appointment being prior to the issue of the 2003 Combined Code.
•
A.4.1 A nominations committee has not been established because the full board is actively involved in all board appointments. 
•
D.1.1 During the year the chairman has not discussed corporate governance or strategy with the company’s institutional 
shareholders.
Further explanation of how the principles have been applied is set out below and, in connection with directors' remuneration, in the
Directors’ remuneration report.
THE BOARD OF DIRECTORS
The board currently comprises the non-executive chairman, two non-executive directors, including the senior independent director, and two
executive directors consisting of the chief executive and finance director. Brief biographical details of all members is set out on page 20.
The membership of all board committees is set out below:
It is the view of the board that all non-executive directors are independent. Richard King has served more than nine years as non-executive
chairman, which included two years prior to the initial public offering in 1996. The board has considered this and believes that he remains
independent. The senior independent director is David Mann. 
There is a schedule of matters specifically reserved for the board’s decision that covers key areas of the group’s affairs which includes overall
responsibility for the business and commercial strategy of the group, policy on corporate governance issues, review of trading performance
and forecasts, the approval of major transactions and the approval of the financial statements and operating and capital expenditure
budgets. The board delegates the day to day responsibility for managing the group to the executive directors.
The attendance of individual directors at board meetings and committee meetings is set out in the table below:
The full board is actively involved in the nomination, selection and appointment of non-executive and executive directors and this is the reason
that a nomination committee for board appointments has not been established. There were no changes to the board structure during the year.
Although no formal meetings between the chairman and the non-executive directors were held during the year without the executives being
present, there is regular contact between the non-executives to discuss appropriate matters as necessary. During the year the board
constantly monitors its performance and that of its committees and the individual directors, although these discussions are not minuted.
Furthermore, individual director’s performance is assessed annually by the remuneration committee when determining levels of compensation
for the following year. A formal evaluation process will be introduced in 2005.
BOARD AUDIT REMUNERATION
Richard King Non-executive chairman Chairman Member Member
David Mann Independent non-executive director Member Member Chairman
Colin Garrett Independent non-executive director Member Chairman Member
Richard Longdon Chief executive Member – –
Paul Taylor Finance director Member – –
AUDIT COMMITTEE REMUNERATION COMMITTEE
BOARD MEETINGS MEETINGS ATTENDED MEETINGS ATTENDED
Number of meetings held932
Richard King 8 3 2
David Mann 9 3 2
Colin Garrett 9 3 2
Richard Longdon 9 – –
Paul Taylor 9 – – AVEVA Annual Report 2005 Corporate governance statement 25
To enable the board to discharge its duties, all directors receive appropriate and timely information. Briefing papers are distributed by the
company secretary to all directors in advance of board meetings. 
The chairman ensures that the directors take independent professional advice as required at the group’s expense in the appropriate
circumstances and all members of the board have access to the advice of the company secretary. The group maintains directors’ and officers’
insurance in respect of the risk of claims against directors. All directors are subject to re-election at least every three years and Richard King
and David Mann are subject to re-election at the forthcoming Annual General Meeting. 
AUDIT COMMITTEE
The Audit Committee comprises the three non-executive directors and is chaired by Colin Garrett with Richard King and David Mann as
members. The chairman of the committee, Colin Garrett , is deemed by the board to have the recent and relevant financial experience as he
is a Chartered Accountant and has held a number of senior financial roles in his career. The Committee meets as required to review the scope
of the audit and the audit procedures, the format and content of the audited financial statements and interim reports, including their notes
and the accounting principles applied. The Committee will also review any proposed change in accounting policies and any recommendations
from the group’s auditors regarding improvements to internal controls and the adequacy of resources within the group’s finance function. 
The Audit Committee advises the board on the appointment of external auditors and on their remuneration both for audit and non-audit
work, and discusses the nature, scope and results of the audit with external auditors. The Audit Committee keeps under review the cost
effectiveness and the independence and objectivity of the external auditors.
The audit committee monitors fees paid to the auditors for non-audit work. The only non-audit work routinely performed by the auditors is
tax compliance and tax advisory work. The audit committee believes that it is cost effective for the auditors to carry out these services and
that the nature of such work does not impair the independence and objectivity of the auditors. Another firm of accountants was employed
during the year for the due diligence services in relation to the acquisition of Tribon Solutions AB and for valuation services in relation to
International Financial Reporting Standards work. 
The board has considered the requirement to have an internal audit function and given the group’s relative size, does not consider one
necessary at this point but will continue to monitor this going forward.
DIALOGUE WITH INSTITUTIONAL SHAREHOLDERS
The chief executive and the finance director have meetings with representatives of institutional shareholders and analysts at least twice
annually primarily following the announcement of the interim and full year results but also at other times during the year as necessary.
These meetings seek to build a mutual understanding of objectives by discussing long-term strategy and obtaining feedback. 
The board also receives formal feedback from analysts and institutional shareholders through the company’s PR adviser and financial adviser. 
The chairman, senior independent and non-executive directors are available for dialogue with shareholders at any time but are not routinely
involved in investor relations or shareholder communications. During the year the senior independent director had dialogue with
institutional shareholders to discuss the new long term incentive plan that was approved in May 2004. 
CONSTRUCTIVE USE OF THE ANNUAL GENERAL MEETING
The board seeks to use the AGM to communicate with investors and all shareholders are encouraged to participate. The chairman of the
Audit Committee and the Remuneration Committee will be available at the AGM to answer any questions.
INTERNAL CONTROL
The board has applied Principle C.2 of the Combined Code by establishing a continuous process for identifying, evaluating and managing 
the significant risks the group faces. The board regularly reviews the process, which has been in place from the start of the year to the 
date of approval of this report and which is in accordance with Internal Control: “Guidance for Directors on the Combined Code” published 
in September 1999. The board is responsible for the group’s system of internal control and for reviewing its effectiveness. Such a system 
is designed to manage rather than eliminate the risk of failure to achieve business objectives, and can only provide reasonable and not
absolute assurance with respect to the preparation of financial information and the safeguarding of assets and against material
misstatement or loss.
In compliance with Provision C.2.1 of the Combined Code, the board continuously reviews the effectiveness of the group’s system of internal
control. The board’s monitoring covers all controls, including financial, operational and compliance controls and risk management. It is based
principally on reviewing reports from management to consider whether significant risks are identified, evaluated, managed and controlled and
whether any significant weaknesses are promptly remedied and indicate a need for more extensive monitoring. The board has also performed
a specific assessment for the purpose of this annual report. This assessment considered all significant aspects of internal control arising
during the period covered by the report. The Audit Committee assists the board in discharging its review responsibilities. DIRECTORS’ REMUNERATION REPORT
AVEVA Annual Report 2005 Directors’ remuneration report 26
This report has been prepared in accordance with Section 234B of the Companies Act 1985. The report also meets the relevant requirements
of the Listing Rules of the Financial Services Authority and describes how the board has applied the Principles of Good Governance relating
to directors’ remuneration. As required by the Regulations, a resolution to approve the report will be proposed at the Annual General Meeting
of the company at which the financial statements of the company will be approved.
The Regulations require the auditors to report to the company members on the ‘auditable part’ of the Directors’ remuneration report and to
state whether in their opinion that part of the report has been properly prepared in accordance with the Companies Act 1985 (as amended).
The report has therefore been divided into separate sections for audited and unaudited information.
UNAUDITED INFORMATION
REMUNERATION COMMITTEE
The Remuneration Committee’s principal responsibility is to determine the remuneration of both the company’s executive directors and its
senior management within broad policies agreed with the board. In addition it reviews the remuneration policy for the company as a whole.
The remuneration of the non-executive directors is determined by the executive directors, not the Committee.
The Committee comprises a chairman (David Mann) and two non-executive directors (Richard King and Colin Garrett). The chief executive
(Richard Longdon) is invited to submit recommendations to the Committee and both he and the members of the Committee take into
consideration relevant external market data as well as the reviews of remuneration for employees of the group generally.
REMUNERATION POLICY 
The Committee aims to ensure that members of the executive management are provided with appropriate incentives to encourage enhanced
performance and are, in a fair and responsible manner, rewarded for their individual contributions to the success of the company. It also
aims for a combination of fixed and variable payments, benefit and share option plans that will achieve a balance in incentives to achieve
short and long-term goals.
BASIC SALARIES
In determining the basic salary of each executive director the Committee takes account of the performance of the company as a whole and
the performance of the individual in achieving financial and non-financial goals within his areas of responsibility.
BONUS PAYMENTS
The executive directors participate in annual performance-related bonus schemes determined by the Committee. The schemes are based
substantially or entirely on the performance of the company as a whole; part may be based on the achievement of personal objectives. 
Bonuses payable in the year to 31 March 2005 amounted to, Richard Longdon £132,000 and Paul Taylor £86,000. For the year ended 
31 March 2005 there was a cap on the bonus that an executive director could earn under the scheme and the maximum cap was 60% 
of basic salary. AVEVA Annual Report 2005 Directors’ remuneration report 27
SHARE OPTIONS
The Committee considers that periodic grants of share-related incentives should constitute an important element of the remuneration of the
company’s senior executives, in line with common practice in competitive companies. However there was very little scope for providing such
incentives via the company’s existing share option scheme. Following discussions with and approval from shareholders at the Extraordinary
General Meeting held in May 2004, a Long Term Incentive Plan (LTIP) was established by the company in 2004 and the dilution limits under
the existing share option scheme were extended. 
During the year 12,000 and 9,000 share options under the LTIP were granted to Richard Longdon and Paul Taylor respectively. The options
were granted at a price equal to the nominal value of an ordinary share, which is 10p. The extent to which the options are exercisable will
depend on the ranking of the company in terms of total shareholder return measured against other companies in the London Stock Exchange
techMARK Index. The performance will be measured three years from the date of grant and there is no allowance for retesting. 
The options will vest in accordance with the following scale:
In determining the conditions of exercise for any future grants of options under the LTIP, the Remuneration Committee will take note of
practical experience, professional advice, market trends and investor guidelines.
SERVICE CONTRACTS
The service contracts and letters of appointment of the directors include the following terms:
The Committee considers that the notice periods of the executive directors are in line with those in other companies of a similar size 
and nature and are in the best interests of the group to ensure stability in senior management. The non-executive and executive directors
retire at any Annual General Meeting where they are so required by the Articles of Association, accordingly their contracts have no set
termination date. 
There are no predetermined special provisions for executive or non-executive directors with regard to compensation in the event of loss 
of office. The Remuneration Committee would be responsible for considering the circumstances of the early termination and in exceptional
circumstances will determine compensation payments in excess of the company’s contractual obligations.
TOTAL SHAREHOLDER RETURN RANKING PERCENTAGE VESTING OF SHARES SUBJECT TO OPTION
75 per cent and above 100 per cent
Median to 75 per cent Pro rata on a straight line basis
Median 33 per cent
Below median Nil
DATE OF CONTRACT DATE OF APPOINTMENT NOTICE PERIOD (MONTHS)
R A King 28 November 1996 28 November 1996 3
C A Garrett 14 July 2000 1 August 2000 3
R Longdon 28 November 1996 28 November 1996 12
D W Mann 17 May 2000 8 June 1999 3
P R Taylor 17 October 1989 1 March 2001 9 DIRECTORS’ REMUNERATION REPORT CONTINUED
AVEVA Annual Report 2005 Directors’ remuneration report 28
PERFORMANCE GRAPH
The following graph shows the company’s performance, measured by total shareholder return, compared with the performance of the
techMARK All Share Index. 
TOTAL SHAREHOLDER RETURN V TECHMARK ALL SHARE INDEX 2000-2005
The directors consider the techMARK All Share Index to be an appropriate choice as the index includes the group.
250
200
150
100
50
0
-50
2000
2001
2002
2003
2004
2005
AVEVA Group plc
techMARK All Share Index AVEVA Annual Report 2005 Directors’ remuneration report 29
AUDITED INFORMATION
DIRECTORS’ REMUNERATION
The total amounts for directors’ emoluments and other benefits were as follows:
BASIC BENEFITS20052004
SALARY FEES BONUS IN KIND TOTAL TOTAL
NAME OF DIRECTOR £000 £000 £000 £000 £000 £000
N o n - E x ecutiv e R A King – 57 – – 57 32
C A Garrett – 25 – – 25 20
D W Mann – 25 – – 25 20
E x ecutiv e A D Christian* ––––– 188
R Longdon 220 – 132 20 372 239
P R Taylor 143 – 86 17 246 156
Aggregate emoluments 363 107 218 37 725 655
*Remuneration shown up to date of resignation from the board on 31 July 2003.
The remuneration of each executive director includes the provision of a company car or allowance and a fuel allowance.
Aggregate emoluments disclosed above do not include any amounts for the value of options to acquire ordinary shares in the company granted
to or held by the directors. DIRECTORS’ REMUNERATION REPORT CONTINUED
AVEVA Annual Report 2005 Directors’ remuneration report 30
SHARE OPTIONS
The interests of directors in options to acquire ordinary shares were as follows:
The market price as at 31 March 2005 was 672.50p with a high-low spread for the year of 492.50p to 682.50p. 
The aggregate gain on exercise of options by directors for the year ended 31 March 2005 was £nil (2004 – £312,572).
The options are normally exercisable in full or in part between the third and seventh anniversaries of the date of grant. All options except
for those at 10p are subject to performance conditions, which require earnings per share to outperform RPI (utilisation) by a total of 10%
over a three year rolling period. The share option rules were established at the time of the company’s initial public offering in 1996 and the
performance conditions set were commonly used at that time. The options granted during the year at 10p are part of the LTIP scheme and
are subject to performance criteria as set out on page 27. The market price at the date of grant was £5.49. The Board monitors whether the
performance conditions have been achieved on an annual basis using a formula which is set out within the rules.
AS AT AS AT EARLIEST
1 APRIL 31 MARCH GAIN ON DATE DATE
2004 GRANTED EXERCISED LAPSED 2005 EXERCISE EXERCISE OF OF
NAME NUMBER NUMBER NUMBER NUMBER NUMBER £ PRICE EXERCISE EXPIRY
R Longdon 100,000 – – – 100,000 – 524.7p 19.01.04 18.01.08
– 12,000 – – 12,000 – 10p 01.07.07 30.06.11
P R Taylor 71,000 – – – 71,000 – 524.7p 19.01.04 18.01.08
– 9,000 – – 9,000 – 10p 01.07.07 30.06.11 AVEVA Annual Report 2005 Directors’ remuneration report 31
PENSIONS
During the year, two directors, (Richard Longdon and Paul Taylor) were members of the AVEVA Solutions Limited’s defined benefit pension
scheme. It is a contributory, funded, final salary occupational pension scheme approved by the Inland Revenue. Under this scheme they are
entitled to a pension on normal retirement, or on retirement due to ill health, equivalent to two-thirds of their pensionable salary provided
they have completed (or would have completed in the case of ill-health) twenty-five years’ service. Inland Revenue earnings limits apply to
Paul Taylor when calculating final salary. Richard Longdon’s salary for pension purposes is capped at £175,000. Future calculations of pension
entitlement will be based upon the capped salary plus increases in line with those applicable to Inland Revenue limits. A lower pension is
payable on earlier retirement after the age of fifty by agreement with the company. Pensions are payable to dependants on the director’s
death in retirement and a lump sum is payable if death occurs in service.
The following directors had accrued entitlements under the pension scheme as follows:
TRANSFER VALUE
ACCUMULATED ACCUMULATED INCREASE IN OF INCREASE,
ACCRUED ACCRUED INCREASE IN ACCRUED PENSION AFTER REMOVING THE
PENSION PENSION ACCRUED DURING THE YEAR, EFFECTS OF INFLATION
AT 31 MARCH AT 31 MARCH PENSION AFTER REMOVING THE LESS DIRECTORS’
2005 2004 DURING YEAR EFFECTS OF INFLATION CONTRIBUTION
££ £ £ £
R Longdon 99,050 92,560 6,490 3,630 24,740
P R Taylor 32,590 28,990 3,600 2,700 11,650
The pension entitlement shown is that which would be paid annually on retirement based on the service to the end of the year.
The transfer value as at date of retirement of each directors’ accrued benefits at the end of the financial year is as follows:
MOVEMENT,
31 MARCH 31 MARCH LESS DIRECTORS’
2005 2004 CONTRIBUTION
£ £ £
R Longdon 826,310 705,403 109,450
P R Taylor 198,750 158,880 33,380
The transfer values have been calculated on the basis of actuarial advice in accordance with Actuarial Guidance Note GN11 (and are net of
directors’ own contributions). Members of the scheme have the option to pay Additional Voluntary Contributions. Neither the contributions nor
the resulting benefits are included in the above table.
High Cross By order of the Board,
Madingley Road 
Cambridge
CB3 0HB
P R Taylor
Secretary
18 May 2005 STATEMENT OF DIRECTORS’ RESPONSIBILITIES
AVEVA Annual Report 2005 Statement of directors’ responsibilities 32
FINANCIAL STATEMENTS, INCLUDING ADOPTION OF GOING CONCERN BASIS 
Company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of
affairs of the company and group and of the profit or loss of the group for that period.
After making enquiries, the directors have a reasonable expectation that the company and the group have adequate resources to continue in
operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial
statements.
In preparing the financial statements, the directors are required to: select suitable accounting policies and then apply them consistently;
make judgements and estimates that are reasonable and prudent; and state whether applicable accounting standards have been followed,
subject to any material departures disclosed and explained in the financial statements.
OTHER MATTERS
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial
position of the company and group and enable them to ensure that the financial statements comply with the Companies Act 1985. They are
also responsible for safeguarding the assets of the company and group and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities. AUDITORS’ REPORT
AVEVA Annual Report 2005 Auditors’ report 33
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF AVEVA GROUP PLC: 
We have audited the financial statements of AVEVA Group plc for the year ended 31 March 2005 which comprise the Consolidated profit and
loss account, Consolidated statement of total recognised gains and losses, Consolidated balance sheet, Company balance sheet, Consolidated
cash flow statement and the related notes numbered 1 to 26. 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. 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 Auditors’ 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 are responsible for preparing the Annual Report, including the financial statements which are required to be prepared in
accordance with applicable United Kingdom law and accounting standards as set out in the Statement of directors’ responsibilities in relation
to the financial statements. The directors are also responsible for preparing the Directors’ remuneration report.
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, United Kingdom Auditing Standards and the Listing Rules of the Financial Services Authority. 
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. We also
report to you if, in our opinion, the Directors’ report is not consistent with the financial statements, if 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
or the Listing Rules regarding directors’ remuneration and transactions with the group is not disclosed. 
We review whether the Corporate governance statement reflects the company’s compliance with the nine provisions of the 2003 FRC
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 procedures or its risk and control procedures.
We read other information contained in the Annual Report and consider whether it is consistent with the audited financial statements. 
This other information comprises the Chairman’s statement, Chief Executive’s review, Financial review, Directors’ report, Board of directors,
unaudited part of the Directors’ remuneration report and Corporate governance statement. 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. AUDITORS’ REPORT CONTINUED
AVEVA Annual Report 2005 Auditors’ report 34
BASIS OF AUDIT OPINION
We conducted our audit in accordance with United Kingdom Auditing Standards 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 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:
•
the financial statements give a true and fair view of the state of affairs of the company and of the group as at 31 March 2005 
and of the profit of the group for the year then ended; and 
•
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. 
Ernst & Young LLP 
Registered Auditor
Cambridge
18 May 2005 AVEVA Annual Report 2005 Consolidated profit and loss account 35
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2005
NOTES 2005 2005 2005 2004
ONGOING ACQUISITIONS CONTINUING CONTINUING
£000 £000 £000 £000       
TURNOVER 2 43,706 13,837 57,543 38,113
Cost of sales 3 (15,008) (4,071) (19,079) (12,588)
GROSS PROFIT 28,698 9,766 38,464 25,525
Other operating expenses 3 (22,372) (10,297) (32,669) (19,388)
OPERATING PROFIT/(LOSS) 6,326 (531) 5,795 6,137
Finance expense (net) 4 (24) (7) (31) (28)
PROFIT/(LOSS) ON ORDINARY ACTIVITES BEFORE TAXATION 5 6,302 (538) 5,764 6,109
Tax on profit/(loss) on ordinary activities 7 (2,882) (2,199)
PROFIT/(LOSS) ON ORDINARY ACTIVITES AFTER TAXATION,
BEING PROFIT FOR THE FINANCIAL YEAR 2,882 3,910
DIVIDENDS PAID AND PROPOSED ON EQUITY SHARES 8 (1,523) (1,019)
RETAINED PROFIT FOR THE YEAR 1,359 2,891
BASIC EARNINGS PER SHARE 9 13.48p 22.63p
ADJUSTED BASIC EARNINGS PER SHARE 9 36.71p 26.20p
DILUTED EARNINGS PER SHARE 9 13.41p 22.42p
DIVIDEND PER EQUITY SHARE 8 6.1p 5.8p
The accompanying notes are an integral part of this Consolidated profit and loss account. 
All results are derived from continuing activities.
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 31 MARCH 2005
2005 2004
£000 £000
Profit for the financial year 2,882 3,910
Translation gain/(loss) arising on consolidation 150 (837)
TOTAL RECOGNISED GAINS AND LOSSES RECOGNISED SINCE LAST ANNUAL REPORT 3,032 3,073
The accompanying notes are an integral part of this consolidated statement of total recognised gains and losses. AVEVA Annual Report 2005 Consolidated balance sheet 36
CONSOLIDATED BALANCE SHEET
31 MARCH 2005
NOTES 2005 2004
£000 £000
FIXED ASSETS
Goodwill 10 26,395 1,313
Other intangible assets 10 1,625 1,977
Intangible assets 28,020 3,290
Tangible assets 11 5,099 5,046
33,119 8,336
CURRENT ASSETS
Stocks 13 – 217
Debtors 14 27,391 18,830
Cash at bank and in hand 12,114 8,713
39,505 27,760
CREDITORS: Amounts falling due within one year 15 (27,368) (14,150)
NET CURRENT ASSETS 12,137 13,610
TOTAL ASSETS LESS CURRENT LIABILITIES 45,256 21,946
CREDITORS: Amounts falling due after more than one year 16 – (41)
Provisions for liabilities and charges 18 (1,686) (335)
NET ASSETS 43,570 21,570
CAPITAL AND RESERVES
Called-up share capital 19 2,204 1,747
Share premium account 20 24,323 8,210
Merger reserve 20 3,921 –
Profit and loss account 20 13,122 11,613
SHAREHOLDERS’ FUNDS – ALL EQUITY 21 43,570 21,570
The accompanying notes are an integral part of this Consolidated balance sheet. AVEVA Annual Report 2005 Company balance sheet 37
COMPANY BALANCE SHEET
31 MARCH 2005
NOTES 2005 2004
£000 £000
FIXED ASSETS
Investments 12 27,482 7,205
CURRENT ASSETS
Debtors 14 4,114 4,369
Cash at bank and in hand 247 52
4,361 4,421
CREDITORS: Amounts falling due within one year 15 (948) (699)
NET CURRENT ASSETS 3,413 3,722
TOTAL ASSETS LESS CURRENT LIABILITIES, BEING NET ASSETS 30,895 10,927
CAPITAL AND RESERVES
Called-up share capital 19 2,204 1,747
Share premium account 20 24,323 8,210
Merger reserve 20 3,921 –
Profit and loss account 20 447 970
SHAREHOLDERS’ FUNDS – ALL EQUITY 30,895 10,927
The accompanying notes are an integral part of this Company balance sheet.
The financial statements were approved by the Board of directors on 18 May 2005 and signed on its behalf by:
R A King
Directors
R Longdon
18 May 2005 AVEVA Annual Report 2005 Consolidated cash flow statement 38
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 MARCH 2005
NOTES 2005 2004
£000 £000
NET CASH INFLOW FROM OPERATING ACTIVITIES 22 11,634 7,880
Returns on investments and servicing of finance 23 (31) (28)
Taxation 23 (3,159) (2,006)
Capital expenditure and financial investment 23 (930) (1,594)
Acquisitions 23 (20,235) –
Equity dividends paid (1,274) (967)
CASH (OUTFLOW)/INFLOW BEFORE FINANCING (13,995) 3,285
Financing 23 16,420 832
INCREASE IN CASH IN THE YEAR 24 2,425 4,117
The accompanying notes are an integral part of this Consolidated cash flow statement. AVEVA Annual Report 2005 Notes to the financial statements 39
1 ACCOUNTING POLICIES
A summary of the principal accounting policies, all of which have been applied consistently throughout the year and the preceding year, 
is set out below.
a ) Basis o f accounting
The financial statements are prepared under the historical cost convention and in accordance with applicable accounting standards.
b ) Basis o f consolidation
The group financial statements consolidate the financial statements of AVEVA Group plc and its subsidiary undertakings made up to 31 March
each year. The acquisition method of accounting has been adopted. Under this method, the results of subsidiary undertakings acquired or
disposed of in the year are included in the consolidated profit and loss account from the date of acquisition or up to the date of disposal. 
Where the company does not hold a majority shareholding in an investee company, but the directors consider that dominant influence is
exercised over its operating and financial policies, the investee company will be treated as a subsidiary for the purposes of consolidation.
No profit and loss account is presented for AVEVA Group plc as provided by Section 230 of the Companies Act 1985. The company's profit
after taxation for the financial year, determined in accordance with the Act, was £1,000,000 (2004 – £1,000,000).
c ) Intangible assets
Goodwill arising on the acquisition of subsidiary undertakings and businesses, representing any excess of the fair value of the consideration
given over the fair value of the identifiable assets and liabilities acquired, is capitalised and written off on a straight-line basis over its 
useful economic life.
Goodwill arising on acquisitions in the year ended 31 March 1998 and earlier periods was written off to reserves in accordance with the
accounting standard then in force. As permitted by the current accounting standard the goodwill previously written off to reserves has 
not been reinstated in the balance sheet. On disposal or closure of a previously acquired business, the attributable amount of goodwill 
previously written off to reserves is included in determining the profit or loss on disposal.
Purchased software rights are capitalised at cost and amortised on a straight line basis over their estimated useful lives.
The carrying value of goodwill and intangible assets is reviewed for impairment at the end of the first full year following acquisition 
and in other periods if events or changes in circumstances indicate the carrying value may not be recoverable.
d ) Research and development
Research and development expenditure is written off in the year of expenditure.
e ) T angible fix ed assets
Tangible fixed assets are stated at cost, net of depreciation and any provision for impairment.
Depreciation is provided at rates calculated to write off the cost, less estimated residual value, based on prices prevailing at the date of
acquisition, of each asset on a straight-line basis over its expected useful life, as follows:
Computer equipment - 25% per annum
Fixtures and fittings and office equipment - 12-15% per annum
Motor vehicles - 25% per annum
Leasehold buildings are amortised on a straight-line basis over the period of the lease or useful economic life if shorter. The carrying 
values of tangible fixed assets are reviewed for impairment when events or changes in circumstances indicate the carrying value may 
not be recoverable.
f ) Investments
Fixed asset investments are shown at cost less any provision for impairment.
NOTES TO THE FINANCIAL STATEMENTS AVEVA Annual Report 2005 Notes to the financial statements 40
1 ACCOUNTING POLICIES CONTINUED
g ) T a x ation
Current tax including UK corporation tax and foreign tax is provided at amounts expected to be paid (or recovered) using the tax rates and
laws that have been enacted or substantially enacted by the balance sheet date.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where 
transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at 
the balance sheet date. Timing differences are differences between the group’s taxable profits and its results as stated in the financial
statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are 
recognised in the financial statements.
A deferred tax asset is regarded as recoverable and therefore recognised only when, on the basis of all available evidence, it can be 
regarded as more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing 
differences can be deducted.
Deferred tax is not recognised when fixed assets are revalued unless by the balance sheet date there is a binding agreement to sell the
revalued assets and the gain or loss expected to arise on sale has been recognised in the financial statements. Neither is deferred tax
recognised when fixed assets are sold and it is more likely than not that the taxable gain will be rolled over, being charged to tax only 
if and when the replacement assets are sold.
Deferred tax is recognised in respect of the retained earnings of overseas subsidiaries and associates only to the extent that, at the balance
sheet date, dividends have been accrued as receivable or a binding agreement to distribute past earnings in the future has been entered
into by the subsidiary or associate.
Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the timing differences are expected to
reverse, based on tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax is measured
on a non-discounted basis.
h ) P ension costs
The group operates defined benefit pension schemes in the UK, Sweden and Germany. The UK defined benefit pension scheme, previously
available to all UK employees was closed to new applicants in 2002. UK employees are now offered membership of a defined contribution
scheme.
The German unfunded defined benefit scheme is closed to new applicants and provides benefits to five deferred members following a
acquisition in 1992 by Tribon. No current employees participate in the scheme.
The group provides pension arrangements to its Swedish employees through an industry wide defined benefit scheme. It is not possible to
identify the share of the underlying assets and liabilities in the scheme which is attributable to the company on a fair and reasonable basis.
Therefore the group has applied the provisions in FRS 17 to account for the scheme as if it was a defined contribution scheme.
Pension costs are accounted for on the basis of charging the expected cost of providing pensions over the period during which the group
benefits from the employees' services. The effect of variations from regular cost is spread over the expected average remaining service lives
of current members of the schemes. The pension cost is assessed in accordance with the advice of qualified actuaries.
The group also operates defined contribution pension schemes for a number of UK and non-UK employees. Differences between 
contributions payable in the year and contributions actually paid are shown as either accruals or prepayments in the balance sheet.
i ) Foreign currency
Transactions denominated in foreign currencies are recorded at actual exchange rates as of the date of the transaction, or, if hedged, 
at the forward contract rate. Monetary assets and liabilities denominated in foreign currencies at the year end are reported at the rates 
of exchange prevailing at the year end or where appropriate, at the forward contract rate. Any gain or loss arising from a change in exchange
rates subsequent to the date of the transaction is included as an exchange gain or loss in the profit and loss account.
The results of overseas subsidiary undertakings are translated at the average exchange rate during the year, and their balance sheets at 
the rates ruling at the balance sheet date. Exchange differences arising on translation of the opening net assets and results of overseas 
subsidiary undertakings are dealt with through reserves.
NOTES TO THE FINANCIAL STATEMENTS CONTINUED AVEVA Annual Report 2005 Notes to the financial statements 41
j ) T urnover
Turnover comprises fees in respect of initial and extension licences, annual licences, and rentals together with income from consultancy 
and other related services (excluding VAT and similar taxes).
For each revenue stream, no revenue is recognised unless and until:
•
a clear contractual arrangement can be evidenced;
•
delivery has been made in accordance with that contract;
•
if required, contractual acceptance criteria have been met; and
•
the fee has been agreed and collectability is probable.
Users can pay an initial licence fee upon installation for a set number of users followed by an obligatory annual fee on each anniversary
of installation. Additional users can be licensed at any time on payment of an extension fee similar to the initial and annual fees. The fees
cover right to use and post contract support which includes core product enhancements and remote support services.
The fees related to the right to use are recognised once the above conditions have been met. Post contract support fees are recognised
rateably over the period of the contract.
As an alternative to the initial/extension licence plus annual fee model, the group also supplies its software under two different types of
rental contract.
Rentals which are invoiced monthly and which are cancellable by the customer are recognised on a monthly basis. 
Other rental contracts are invoiced at the start of the contracted period, are non-cancellable and consist of two separate components, 
the right to use and the right for post contract support. Revenue in respect of the right to use is recognised once the above conditions 
have been met and revenue for post contract support is recognised rateably over the period of the contract. 
Income from consultancy and other related services is recognised as the services are provided.
k ) Leases
Rentals payable under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on 
such a basis. 
Where fixed assets are financed by leasing arrangements which transfer to the group substantially all the benefits and risks of ownership, 
the assets are treated as if they had been purchased outright and are included in tangible fixed assets. The capital element of the leasing
commitments is shown as obligations under finance leases. The lease rentals are treated as consisting of capital and interest elements. 
The capital element is applied to reduce the outstanding obligations and the interest element is charged against profit in proportion to the
reducing capital element outstanding. Assets held under finance leases are depreciated over the shorter of the lease terms and the useful
lives of equivalent owned assets.
l ) Derivative financial instruments
The group uses forward foreign exchange contracts to reduce exposure to foreign exchange risk. The group does not use forward foreign
exchange contracts for speculative purposes.
For a forward foreign exchange contract to be treated as a hedge the instrument must be related to actual foreign currency assets or 
liabilities or to a probable commitment. It must involve the same currency as the hedged item and must also reduce the risk of foreign 
currency exchange movements on the group's operations. Gains and losses arising on these contracts are deferred and recognised in the 
profit and loss account, or as adjustments to the carrying amount of fixed assets, only when the hedged transaction has itself been reflected
in the group's financial statements.
m ) Long term contracts
Cumulative costs incurred net of amounts transferred to costs of sales, less provision for contingencies and anticipated future losses on 
contracts, are included as long-term contract balances in stock.
Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the Profit and
loss account turnover and related costs as contract activity progresses. AVEVA Annual Report 2005 Notes to the financial statements 42
2 TURNOVER
A geographical analysis of turnover by destination is set out below:
2005 2005 2005 2004
ONGOING ACQUISITIONS CONTINUING CONTINUING
£000 £000 £000 £000
United Kingdom 5,291 285 5,576 3,458
Rest of Europe, Middle East and Africa 16,627 5,742 22,369 16,073
Americas 9,036 311 9,3479,862
Asia Pacific 12,752 7,499 20,251 8,720
43,706 13,837 57,543 38,113
No further segmental analysis is given as, in the opinion of the directors, disclosure of this information would be seriously prejudicial to the
interests of the group.
3 COST OF SALES AND OTHER OPERATING EXPENSES
Group operating profit for the year was £10.76m (2004 - £6.76m) before exceptional items of £2.29m (2004 - £nil) and goodwill and 
intangible amortisation of £2.68m (2004 - £0.62m). 
Of the total group operating profit before exceptional items and goodwill and intangible amortisation of £10.76m, £7.37m was generated
from existing operations and £3.39m was generated from acquisitions.
An analysis of cost and expenses is as follows:
E x ceptional costs
Following the acquisition of Tribon Solutions AB (now renamed AVEVA AB) on 19 May 2004, the group has undertaken a rationalisation of 
its operations as part of the integration of the two businesses which has involved headcount reductions, reorganisation of operations and
office closures. The total exceptional costs incurred in the year were £2,287,000 of which £366,000 is included in cost of sales, £959,000 
is included in selling costs and £962,000 is included in administrative expenses. The costs include redundancy, payment in lieu of notice, 
holiday pay, and office rental and associated costs.
2005 2005 2005 2004
ONGOING ACQUISITIONS CONTINUING CONTINUING
£000 £000 £000 £000
COST OF SALES
Exceptional items 87 279 366 –
Non-exceptional cost of sales 14,921 3,792 18,713 12,588
15,008 4,071 19,079 12,588
OTHER OPERATING EXPENSES
Selling costs 13,944 4,390 18,334 14,367
Exceptional items-selling costs 197 762 959 –
Administrative costs 8,083 4,331 12,414 5,021
Exceptional items-administrative costs 148 814 962 – 
22,372 10,297 32,669 19,388
NOTES TO THE FINANCIAL STATEMENTS CONTINUED AVEVA Annual Report 2005 Notes to the financial statements 43
4 FINANCE EXPENSE (NET)
5 PROFIT/(LOSS) ON ORDINARY ACTIVITIES BEFORE TAXATION
Fees paid to the auditors disclosed above include £93,000 paid in respect of the acquisition of Tribon Solutions AB. A further £505,000
was paid to another major firm of accountants in relation to due diligence and reporting accountant services. These amounts are partly 
capitalised within goodwill and partly offset against the share premium account.
6 STAFF COSTS
Staff costs relating to employees (including executive directors) are shown below:
The average monthly number of persons (including executive directors) employed by the group was as follows:
2005 2005 2005 2004
ONGOING ACQUISITIONS CONTINUING CONTINUING
£000 £000 £000 £000
Interest receivable 59 11 70 14,367
Bank interest payable and similar charges (83) (18) (101) 5,021
(24) (7) (31) 19,388
2005 2004
£000 £000
Depreciation of owned tangible fixed assets 1,427 1,025
Depreciation of tangible fixed assets held under finance leases 71 102
Amortisation of purchased software rights 352 352
Amortisation of goodwill 2,331 267
Auditors' remuneration
- audit  (current auditors) 346 216
- non-audit (current auditors) 441 201
- non-audit (previous auditors) –19
Research and development costs 11,224 6,858
Operating lease rentals
- land and buildings 1,245 924
- plant and machinery 432 266
(Profit)/loss on disposal of tangible fixed assets (35) 7
2005 2004
£000 £000
Wages and salaries 18,143 12,895
Social security costs 2,629 1,717
Other pension costs 2,405 1,601
23,177 16,213
2005 2004
NUMBER NUMBER
Research, development and product support 171 102
Sales, marketing and customer support 214 156
Administration 89 68
474 326
Directors’ remuneration
The disclosure of individual directors’ remuneration and interests required by the Companies Act 1985 and those specified for audit by the Listing Rules
of the Financial Services Authority are shown in the Directors’ remuneration report on pages 26 to 31 and form part of these financial statements. AVEVA Annual Report 2005 Notes to the financial statements 44
7 TAX ON PROFIT/(LOSS) ON ORDINARY ACTIVITIES
The tax charge comprises:
The differences between the total current tax shown above and the amount calculated by applying the standard rate of UK corporation tax to
the profit before tax are as follows:
The group’s tax rate is higher than the UK tax rate because a significant proportion of its profits are earned overseas and are subject to higher
rates of tax. This is expected to continue for the foreseeable future. In addition, goodwill amortisation of £2.1m is not tax deductible.
8 DIVIDENDS PAID AND PROPOSED ON EQUITY SHARES
2005 2004
£000 £000
UK corporation tax – 945
Adjustments in respect of prior periods (6) 115
(6) 1,060
Foreign Tax 2,858 1,243
Adjustments in respect of prior periods 518 33
TOTAL CURRENT TAX 3,370 2,336
DEFERRED TAX
Origination and reversal of timing differences (note 18) (488) (137)
TOTAL TAX ON PROFIT ON ORDINARY ACTIVITIES 2,882 2,199
2005 2004
£000 £000
Tax on group profit on ordinary activities at standard UK corporation tax rate of 30% (2004 – 30%) 1,729 1,833
Effects of:
Expenses not deductible for tax purposes 281 86
Amortisation of goodwill arising on acquisition of Tribon Solutions AB 578 –
Irrecoverable withholding tax 562 –
UK research & development tax credit – (125)
Depreciation in excess of capital allowances 60 111
Other timing differences - provided 541 –
- unprovided 122 16
Higher tax rates on overseas earnings 251 254
Unrelieved tax losses (1,266) 13
Adjustments in respect of prior years 512 148
GROUP CURRENT TAX CHARGE FOR YEAR 3,370 2,336
2005 2004
£000 £000
Interim dividend paid of 1.8p (2004 - 1.8p) per ordinary share 396 320
Final dividend proposed of 4.3p (2004 – 4.0p) per ordinary share 948 699
Final dividend paid for 2004 in respect of additional shares issued 179 –
1,523 1,019
NOTES TO THE FINANCIAL STATEMENTS CONTINUED AVEVA Annual Report 2005 Notes to the financial statements 45
9 EARNINGS PER SHARE
The calculations of earnings per share are based on the profit after tax for the year of £2,882,000 (2004 - £3,910,000) and the following
weighted average numbers of shares:
Adjusted basic earnings share is calculated by adding back exceptional costs of £2,287,000 (2004 - £nil) and goodwill and intangible
amortisation of £2,683,000 (2004 - £619,000).
The directors believe that adjusted earnings per share provides a more meaningful measurement of performance of the underlying business.
10 INTANGIBLE FIXED ASSETS
Purchased software rights arose on the acquisition of the products 'FOCUS' for £1,700,000 on 13 September 1999, 'VANTAGE' for £1,500,000
on 2 December 1999 and OPE software for £323,000 on 7 September 2000. 
Purchased goodwill arose on the acquisition of a trade which included rights to integrate, develop and market 3D design software from AEA
Technology on 30 March 1999. The initial cost of goodwill was £2,169,000.
In addition, on 12 November 1998 AVEVA agreed to acquire from the distributor Kyokuto Boeki Kaisha all AVEVA’s business in Japan.
The goodwill arising on acquisition was £500,000.
Details of the acquisition of Realitywave Inc and Tribon Solutions AB group are set out in note 12. All intangible assets are being amortised
over their useful economic life of ten years, with the exception of Realitywave Inc which is being amortised over five years.
The company had no intangible fixed assets in either year.
2005 2004
NUMBER NUMBER
For basic earnings per share 21,387,290 17,281,707
Employee share options 111,882 156,687
For diluted earnings per share 21,499,172 17,438,394
PURCHASED
SOFTWARE 
RIGHTS GOODWILL
GROUP £000 £000
COST
At 1 April 2004 3,523 2,669
Additions – 27,413
At 31 March 2005 3,523 30,082
AMORTISATION
At 1 April 2004 1,546 1,356
Charge for the year 352 2,331
At 31 March 2005 1,898 3,687
NET BOOK VALUE
At 1 April 2004 1,977 1,313
At 31 March 2005 1,625 26,395 AVEVA Annual Report 2005 Notes to the financial statements 46
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
11 TANGIBLE FIXED ASSETS
The net book value of computer equipment includes an amount of £41,000 (2004 - £112,000) in respect of assets held under finance leases.
The company had no tangible fixed assets.
LONG FIXTURES,
LEASEHOLD FITTINGS
LAND AND COMPUTER AND OFFICE MOTOR 
BUILDINGSEQUIPMENTEQUIPMENT VEHICLES TOTAL
GROUP £000 £000 £000 £000 £000
COST OR VALUATION
At 1 April 2004 3,081 6,870 2,413 402 12,766
Acquisition of subsidiary undertakings – 208 374 – 582
Additions 66 521 371 122 1,080
Disposals – (33) (83) (167) (283)
Exchange adjustment – (2) 2 (2) (2)
At 31 March 2005 3,147 7,564 3,077 355 14,143
DEPRECIATION
At 1 April 2004 264 5,924 1,343 189 7,720
Charge for the year 94 713 610 81 1,498
Disposals – (20) (32) (116) (168)
Exchange adjustment – (6) – – (6)
At 31 March 2005 358 6,611 1,921 154 9,044
NET BOOK VALUE
At 1 April 2004 2,817 946 1,070 213 5,046
At 31 March 2005 2,789 953 1,156 201 5,099 AVEVA Annual Report 2005 Notes to the financial statements 47
12 FIXED ASSETS INVESTMENTS
Investments in subsidiary undertakings
COMPANY £000
COST AND NET BOOK VALUE
At 1 April 2004 7,205
Additions 20,277
At 31 March 2005 27,482
All subsidiary undertakings have been included in the consolidation.
At 31 March 2005 the group had the following investments, which are held by AVEVA Solutions Limited unless stated:
COUNTRY OF
INCORPORATION PRINCIPAL DESCRIPTION AND PROPORTION OF
OR REGISTRATION ACTIVITY SHARES AND VOTING RIGHTS HELD
AVEVA Solutions Limited* Great Britain Software development 
and marketing 100% ordinary shares of £1 each
AVEVA Inc USA Software marketing 100% common stock of US$1 each
AVEVA GmbH Germany Software marketing 100% ordinary shares of Euros 25,565 each
AVEVA SA France Software marketing 100% ordinary shares of Euros 30 each 
AVEVA East Asia Limited Hong Kong Software marketing 100% ordinary shares of HK$1 each
Cadcentre Property Limited Great Britain Holding property 100% ordinary shares of £1 each
Cadcentre Pension Trustee Limited Great Britain Trustee company 100% ordinary shares of £1 each
AVEVA Engineering IT Limited Great Britain Software marketing 100% ordinary shares of £1 each
AVEVA AS Norway Training and consultancy 100% ordinary shares of NOK 500 each
AVEVA KK Japan Software marketing 100% ordinary shares of 50,000 Yen each
AVEVA Sendirian Berhad**** Malaysia Software marketing 49% ordinary shares of MYR1 each
AVEVA Asia Pacific Sendirian Berhad Malaysia Software marketing 100% ordinary shares of MYR1 each
AVEVA Korea Limited Korea Software marketing 100% ordinary shares of KRW500,000 each 
AVEVA Managed Services Limited Great Britain Consulting & support services 100% ordinary shares of £1 each
Cadcentre Limited* Great Britain Consulting & support services 100% ordinary shares of £1 each
AVEVA Consulting Limited* Great Britain Consulting & support services 100% ordinary shares of £1 each
AVEVA Information Technology 
India Private Limited India Software marketing 100% ordinary shares of 10 Rupee each
Cadcentre Engineering IT Limited Great Britain Software marketing 100% ordinary shares of £1 each
AVEVA Pty Limited Australia Software marketing 100% ordinary shares of AUD$1 each
Realitywave Inc** USA Software development 
and marketing 100% of common stock of US$1 each
AVEVA AB (formerly Tribon Solutions AB) Sweden Software development 
and marketing 100% of ordinary shares of SEK10 each
Tribon Solutions GmbH*** Germany Software marketing 100% of ordinary shares 
Tribon Solutions (UK) Limited*** Great Britain Dormant 100% of ordinary shares of £1 each
Tribon Solutions Korea Limited*** Korea Software marketing 100% of ordinary shares of KRW100,000 each
Nippon Tribon KK*** Japan Software marketing 100% of ordinary shares of 50,000 Yen each
Tribon Solutions (SEA) Pte Limited*** Singapore Software marketing 100% of ordinary shares of $10 each
Tribon dot.com Sweden AB*** Sweden Dormant 100% of ordinary shares of SEK100 each
* held by AVEVA Group plc
** held by AVEVA Inc
*** held by AVEVA AB
**** AVEVA Sendirian Berhad has been consolidated on the basis that the group exercises dominant 
influence over its financial and operating policies under the terms of the shareholders’ agreement.
On 31 December 2004 Tribon Solutions Inc was dissolved and transferred its trade and assets to AVEVA Inc.
On 31 December 2004 Tribon Solutions (UK) Limited transferred its trade and assets to AVEVA Solutions Limited. AVEVA Annual Report 2005 Notes to the financial statements 48
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12 FIXED ASSETS INVESTMENTS CONTINUED
ACQUISITION OF TRIBON SOLUTIONS AB
On 21 April 2004 the company signed an agreement conditional upon shareholder approval to acquire the entire issued share capital of
Tribon Solutions AB, a Swedish group which develops, markets and supports software solutions for use in the design and production
processes in marine industry all over the world. The total consideration for the acquisition was £20,277,000, £14,997,000 of which was 
satisfied in cash, £4,000,000 was satisfied through the issue of 789,655 ordinary shares of 10p each to the vendors and costs of £1,280,000
which were incurred in relation to the acquisition. The goodwill is being amortised over ten years.
At an Extraordinary General Meeting held on 14 May 2004, a special resolution was passed to approve the acquisition and the transaction
completed on 19 May 2004.
The investment in Tribon Solutions AB group has been included at its fair value in the Company balance sheet at the date of the acquisition,
which was 19 May 2004.
The following table sets out the book values of the identifiable assets and liabilities acquired and their fair value to the group:
ACCOUNTING
BOOK POLICY OTHER FAIR
VALUE ALIGNMENT ADJUSTMENTS VALUE
£000 £000 £000 £000
FIXED ASSETS
Intangible 3,008 (3,008)
(i)
––
Tangible 575 – – 575
Other assets 105 – – 105
CURRENT ASSETS
Debtors 4,961 (972)
(ii)
(542)
(iii)
3,447
Cash 708 – – 708
Total assets 9,357 (3,980) (542) 4,835
CREDITORS
Bank overdraft 1,498 – – 1,498
Accounts payable 307 – – 307
Other creditors 157 – 653)
(iv)
810
Accruals and deferred income 4,862 – 20)
(v)
4,882
PROVISIONS
Pensions 608 – 312)
(vi)
920
TOTAL LIABILITIES 7,432 – 985 8,417
NET ASSETS/(LIABILITIES) 1,925 (3,980) (1,527) (3,582)
Goodwill arising on acquisition 23,859
20,277
SATISFIED BY:
Cash 14,997
Fair value of shares issued 4,000
Costs associated with acquisition 1,280
20,277
ADJUSTMENTS
i change in accounting policy for internal capitalised development costs
ii change in revenue recognition for two specific contracts
iii write down of debtors following reassessment of specific bad debt provision
iv provision for additional potential tax liabilities 
v adjustment to accruals
vi adjustment to pension scheme liability provision AVEVA Annual Report 2005 Notes to the financial statements 49
AVEVA AB group earned a profit after tax of £2,433,000 in the fifteen months ended 31 March 2005 (year ended 31 December 2003 -
£564,000) including a loss of £2,275,000 which arose in the period from 1 January 2004 to 19 May 2004. The summarised profit and loss
account for the period from 1 January 2004 to 19 May 2004 is as follows:
£000
Turnover 4,004
Operating loss (807)
Loss before tax (1,317)
Taxation (958)
Loss for the period (2,275)
There were no recognised gains or losses in the period other than the profit shown above.
AVEVA AB group utilised £433,000 of the group’s operating cash flows, paid £134,000 in respect of net returns on investments and servicing of
finance, paid tax of £152,000, utilised £59,000 for capital expenditure and financial investment and generated £2,263,000 from financing.
ACQUISITION OF REALITYWAVE INC
On 31 March 2005 the group completed the acquisition of Realitywave Inc, a software development company based in Boston, Massachusetts,
USA. The consideration was £3,192,000 consisting of cash of £3,140,000 and costs of acquisition of £52,000, which resulted in goodwill of
£3,554,000 arising. The goodwill is being amortised over five years.
The following table sets out the book values of the identifiable assets and liabilities acquired to the group. There were no fair value adjustments
to the Realitywave Inc balance sheet as the fair value of assets and liabilities was deemed to equate to book value:
BOOK AND FAIR
VALUE
£000
FIXED ASSETS
Tangible 7
CURRENT ASSETS
Debtors 24
Cash 23
Total assets 54
CREDITORS
Accruals 273
Deferred revenue 143
TOTAL LIABILITIES 416
NET LIABILITIES (362)
Goodwill arising on acquisition 3,554
3,192
SATISFIED BY:
Cash 3,140
Costs associated with acquisition 52
3,192 AVEVA Annual Report 2005 Notes to the financial statements 50
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2005 2004
GROUP COMPANY GROUP COMPANY
£000 £000 £000 £000
Amounts falling due within one year:
Trade debtors 22,503 – 14,391 –
UK corporation tax receivable 396 – – –
Overseas tax receivable 353 – – –
Amounts owed by group undertakings – 4,114 – 4,369
Prepayments and other debtors 1,963 – 4,127 –
Accrued income 2,023 – 312 –
Deferred tax asset (see note 18) 153 – –
27,391 4,114 18,830 4,369
2005 2004
GROUP COMPANY GROUP COMPANY
£000 £000 £000 £000
Amounts falling due within one year:
Bank overdraft 903 – – –
Obligations under finance leases (note 17) 41 – 71 –
Trade creditors 1,197 – 796 –
UK corporation tax payable – – 292 –
Overseas tax payable 2,293 – 469 –
Social security, PAYE and VAT 2,806 – 1,194 –
Other creditors 300 – 98 –
Accruals 7,657 – 4,529 –
Deferred income 11,223 – 6,002 -
Proposed dividend 948 948 699 699
27,368 948 14,150 699
The bank overdraft is secured by a floating charge over certain of the group’s assets.
13 STOCKS
14 DEBTORS
15 CREDITORS
2005 2004
GROUP COMPANY GROUP COMPANY
£000 £000 £000 £000
Net cost – – 217 – AVEVA Annual Report 2005 Notes to the financial statements 51
16 CREDITORS
2005 2004
GROUP COMPANY GROUP COMPANY
£000 £000 £000 £000
Amounts falling due after more than one year:
Obligations under finance leases, due within one to two years (note 17) – 41 –
17 DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS
The disclosures in this note deal with financial assets and financial liabilities as defined in FRS 13 “Derivatives and other financial instruments:
Disclosures”. Certain financial assets such as investments in subsidiaries are excluded from the scope of these disclosures. 
The group’s financial instruments comprise cash and liquid resources, and various items, such as trade debtors and trade creditors that arise
directly from its operations. As permitted by FRS 13, short-term debtors and creditors have also been excluded from the disclosures (except as
indicated below).
It is, and has been, throughout the period under review, the group’s policy that no trading in financial instruments shall be undertaken.
The main risks arising from the group’s financial instruments are interest rate risk, liquidity risk and foreign currency risk. The board reviews and
agrees policies for managing such risks on a regular basis as summarised below.
Inter e s t r ate and liquidity risks
The group holds net funds, and hence its interest rate risk and liquidity risk are associated with short-term cash deposits. The group's overall
objective with respect to holding these deposits is to maintain a balance between accessibility of funds and competitive rates of return. In 
practice this has meant that no deposits have been made with a maturity date greater than three months in the course of the year.
F o reign curre n c y risk
Foreign currency risk arises from the group undertaking a significant number of foreign currency transactions in the course of operations. Where
such transactions are material, the board has a policy of entering into foreign currency contracts or currency matching to help manage currency
risk. The group’s objectives in managing the currency exposure arising from its net investments overseas are to maintain a low cost of borrowing,
and to retain some potential for currency related appreciation, while partially hedging against currency depreciation. Gains and losses arising
from these structural currency exposures are recognised in the consolidated statement of total recognised gains and losses. AVEVA Annual Report 2005 Notes to the financial statements 52
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
17 DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS CONTINUED
Inter e s t r a t e p r o file of financial assets
The group has financial assets denominated in both sterling and foreign currency deposits. These comprise cash balances, overdrafts and
deposits at short-term rates.
Inter e s t r a t e p r o file of financial liabilities
2005 2004
FLOATING FINANCIAL ASSETS FLOATING FINANCIAL ASSETS
RATE ON WHICH RATE ON WHICH
FINANCIAL NO INTEREST FINANCIAL NO INTEREST
ASSETS IS EARNED TOTAL ASSETS IS EARNED TOTAL
£000 £000 £000 £000 £000 £000
Sterling (931) 93 (838) 721 – 721
US Dollar 2,156 263 2,419 1,060 – 1,060
Euro 4,466 3 4,469 3,818 – 3,818
Japanese Yen 1,342 520 1,862 1,466 – 1,466
Norwegian Kroner 167 – 167 151 – 151
Korean Won 2,432 – 2,432 904 – 904
Malaysian Ringgit 383 – 383 246 – 246
Indian Rupee 68 – 68 180 – 180
Australian Dollar 893 – 893 71 – 71
Swedish Kroner 14 23 37 – 25 25
Chinese Yuan Reminbi 121 12 133 – – –
Hong Kong Dollar – 25 25 – 35 35
Other currencies 5 59 64 – 36 36
Total 11,116 998 12,114 8,617 96 8,713
2005 2004
FLOATING FIXED FLOATING FIXED
RATE RATE TOTAL RATE RATE TOTAL
£000 £000 £000 £000 £000 £000
Swedish Kroner 903 – 903 – – –
Sterling – 41 41 – 112 112
903 41 944 – 112 112
The interest rate on floating rate financial assets is linked to the base rate of the relevant country. AVEVA Annual Report 2005 Notes to the financial statements 53
The floating rate financial liability for 2005 comprised a Swedish bank overdraft facility bearing interest at 3.23%. 
The fixed rate financial liability comprises two finance leases with weighted average interest rate of 12% (2004 – 12%). 
Curr e n c y e xposur e s The table below shows the group's transactional currency exposures that give rise to the net currency gains and losses recognised in the
Profit and loss account. Such exposures comprise the monetary assets and liabilities of the group that are not denominated in the functional
currency of the operating unit. As at 31 March 2005 and 31 March 2004 these exposures (including those arising on short-term debtors and
creditors) were as follows: 
B o r rowing facilities
The group had committed a UK borrowing overdraft facility and revolving loan facility at 31 March 2005 of £3,000,000 and £3,000,000
respectively (2004 - £1,500,000 and nil) of which £1,179,000 of the overdraft had been drawn down at 31 March 2005. The group has right
of offset against cash balances held. In addition the group had a committed overdraft facility of SEK30m (£2.3m) at 31 March 2005 of which
£903,000 had been drawn down. All conditions precedent in respect of the overdrafts and loan had been met.
F a i r v alues
The book values of the group’s financial assets and liabilities consist of cash of £12,114,000 (2004 - £8,713,000), overdraft of £903,000
(2004 – £nil)  and finance leases of £41,000 (2004 - £112,000). 
There is no material difference between the book value and fair value of the group’s financial instruments in the current or the preceding year.
2005 2004
£000 £000
The maturity profile of the group’s financial liabilities is as follows:
In one year or less, or on demand 41 71
Between one and two years –41
41 112
NET FOREIGN CURRENCY MONETARY ASSETS/(LIABILITIES)        
FUNCTIONAL CURRENCY
OF GROUP OPERATION GBP US$ EURO SEK SNG$ JPY AUS$ TOTAL
£000 £000 £000 £000 £000 £000 £000 £000
2005
Sterling –1,875805––563–3,243
Korean Won – 949 – 473––– 1,422
Malaysian Ringgit – 684 246 – 10 – – 940
Swedish Kroner (103) 398 3,420 – – (74) – 3,641
(103) 3,906 4,471 473 10 489 – 9,246
2004
Sterling – 1,188 418–––– 1,606
Malaysian Ringgit (MYR 000’s) – 118––7– 48 173
– 1,306 418–7– 48 1,779 AVEVA Annual Report 2005 Notes to the financial statements 54
17 DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS CONTINUED
Gains and losses on hedges
The group enters into forward foreign currency contracts to minimise the currency exposures that arise on sales denominated in foreign 
currencies. Changes in the fair value of instruments used as hedges are not recognised in the financial statements until the hedge position
matures. No material unrecognised gains or losses on hedged financial instruments existed at 31 March 2005 or 31 March 2004.
As at 31 March 2005 there was a forward contract in the UK to sell USD 1,000,000 on 30 June 2005. This contract was entered into to hedge
against debtors denominated in USD in the UK at that date.
Additionally, as at 31 March 2005 there were forward contracts in Sweden to sell USD 554,000 and EUR 2,240,000 on 15 April 2005, to sell
USD 510,500 and EUR 500,000 on 17 May 2005, and to sell EUR 592,000 on 15 June 2005. These contracts were entered into to hedge trade
debtors denominated in USD and EUR in Sweden at that date. The balance of the forward contracts was held to hedge USD and EUR income
expected to arise from recurring revenues over the period to 30 June 2005.
The directors consider these to qualify for hedge accounting since the following criteria are met:
•
the instruments are related to foreign exchange existing assets or probable future income whose characteristics have been identified;
•
they involve the same currency as the hedged item; and
•
they reduce the risk of foreign currency exchange movements to the group operations.
18 PROVISIONS FOR LIABILITIES AND CHARGES
RETIREMENT RESTRUCTURING DEFERRED
PROVISIONS PROVISION TAX GROUP
£000 £000 £000 £000
At 1 April 2004 – – 335 335
Acquisitions 920 – – 920
Charged/(credited) to profit and loss account 211 2,287 (488)       2,010
Utilised (287) (1,463) – (1,750)
Exchange adjustment 18 – – 18
At 31 March 2005 862 824 (153) 1,533
At 31 March 2005 - provision 862 824 – 1,686
At 31 March 2005 – asset (see note 14) - - (153)       (153)
DEFERRED TAX
2005 2004 2005 2004
PROVIDED PROVIDED UNPROVIDED UNPROVIDED
£000 £000 £000 £000
Analysis of deferred tax liability/(asset):
Accelerated capital allowances 161 365 – –
Short term timing differences (314) (30) (762) –
Tax losses – – (1,834) (13)
(153) 335 (2,596) (13)
RETIREMENT PROVISIONS
Provisions for liabilities and charges includes provisions for the overseas retirement schemes in Sweden, Germany and Korea as described in
note 25(a)(iii).
NOTES TO THE FINANCIAL STATEMENTS CONTINUED AVEVA Annual Report 2005 Notes to the financial statements 55
RESTRUCTURING PROVISION
The restructuring provision includes the cost of rationalising the operations of the AVEVA AB group following the acquisition on
19 May 2004. The provision includes costs for headcount reductions, reorganisation of operations and office closures. It is expected that the
costs will all be incurred within two years of the balance sheet date.
In addition, if the long leasehold property were to be sold at its current net book value, a tax liability of up to £269,000 (2004 – £269,000)
may arise. No provision has been made for this liability as there is no intention to dispose of the property. If the property were to be sold in
the future, the tax liability would probably be mitigated or deferred by available reliefs. 
The company has no deferred tax liability.
19 CALLED-UP SHARE CAPITAL
2005 2004
GROUP AND COMPANY £000 £000
A uthorised
30,000,000 (2004 - 22,000,000) ordinary shares of 10p each 3,000 2,200
Allotted, called-up and fully paid
22,036,617 (2004 – 17,470,300) ordinary shares of 10p each 2,204 1,747
On 14 May 2004 the authorised share capital was increased to £3,000,000 by the creation of 8,000,000 ordinary shares of 10p each.
In order to finance the cash consideration for the acquisition of Tribon Solutions AB (now AVEVA AB) and expenses related thereto, the company
raised cash of £17,241,000, (before expenses of £2,565,000 of which £1,256,000 has been offset against share premium) pursuant to a Placing
and Open Offer of 3,645,112 ordinary shares of 10p each. An additional 789,655 ordinary shares of 10p each were issued to the vendors as part
of the consideration with a fair value of £4,000,000. In addition, during the year 131,550 ordinary shares with a nominal value of £13,155 were
issued following the exercise of employee share options of 40,000 at an exercise price of 524.7p per share, 10,000 at an exercise price of 491.8p
per share, 3,000 at an exercise price of 479.5p per share, 7,200 at an exercise price of 395.0p per share, 14,950 at an exercise price of 342.5p
per share, 30,000 at an exercise price of 309.5p per share, 25,000 at an exercise price of 230.0p per share and 1,400 at an exercise price of
179.2p per share. This resulted in proceeds of £505,948 including a premium of £492,793.
Share options
Share options have been granted to certain employees of the group and remain outstanding as follows:
NUMBER EXERCISE
DATE OF GRANT OF OPTIONS PRICE(p)
16 March 1999 4,000 179.2
30 March 2000 30,400 342.5
19 January 2001 317,300 524.7
12 July 2001 101,800 479.5
6 August 2001 25,000 463.3
1 July 2004 30,000 10.0
These options are normally exercisable in full or in part between the third and seventh anniversaries of the date of grant. AVEVA Annual Report 2005 Notes to the financial statements 56
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
20 RESERVES
SHARE PROFIT
MERGER PREMIUM AND LOSS
RESERVE ACCOUNT ACCOUNT
GROUP £000 £000 £000
At 1 April 2004 – 8,210 11,613
Profit for the year – – 2,882
Dividends – – (1,523)
Translation arising on consolidation – – 150
Share issues 3,921 16,113 –
At 31 March 2005 3,921 24,323 13,122
Included within profit and loss account reserves is goodwill of £3,934,000 which was directly eliminated against reserves in 1995 (2004 -
£3,934,000).
SHARE PROFIT
MERGER PREMIUM AND LOSS
RESERVE ACCOUNT ACCOUNT
COMPANY £000 £000 £000
At 1 April 2004 – 8,210 970
Share issues 3,921 16,113 –
Profit for the year – – 1,000
Dividends – – (1,523)
At 31 March 2005 3,921 24,323 447
21 RECONCILIATION OF MOVEMENTS IN GROUP SHAREHOLDERS’ FUNDS  
2005 2004
£000 £000
Profit for the financial year 2,882 3,910
Other recognised gains and losses relating to the year 150 (837)
3,032 3,073
Dividends paid and proposed on equity shares (1,523) (1,019)
New shares issued 20,491 934
Net addition to shareholders' funds 22,000 2,988
Opening shareholders' funds 21,570 18,582
Closing shareholders' funds 43,570 21,570 AVEVA Annual Report 2005 Notes to the financial statements 57
22 RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIES 
23 ANALYSIS OF CASH FLOWS
2005 2004
£000 £000
Operating profit 5,795 6,137
Depreciation and amortisation charges 4,181 1,746
(Profit)/loss on disposal of fixed assets (35) 7
Decrease in stocks 217 541
Increase in debtors (4,097) (4,677)
Increase in creditors 4,717 4,126
Increase in provisions 856 –
NET CASH INFLOW FROM OPERATING ACTIVITIES 11,634 7,880
2005 2004
£000 £000
Returns on investments and servicing o f finance
Interest received 70 61
Interest paid (101) (89)
NET CASH OUTFLOW (31) (28)
T a x ation
UK corporation tax (paid)/received (784) 55
Foreign tax paid (2,375) (2,061)
NET CASH OUTFLOW (3,159) (2,006)
Capital e xpenditure and financial investment
Purchase of tangible fixed assets (1,080) (1,763)
Proceeds from sale of tangible fixed assets 150 169
NET CASH OUTFLOW (930) (1,594)
A cquisitions
Purchase of subsidiary undertakings (19,468) –
Net overdraft acquired with subsidiary undertaking (767) –
NET CASH OUTFLOW (20,235) –
Financing
Issue of ordinary share capital 16,491 934
Capital element of finance lease rental payments (71) (102)
NET CASH INFLOW 16,420 832 AVEVA Annual Report 2005 Notes to the financial statements 58
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
1 APRIL EXCHANGE 31 MARCH
2004 CASH FLOW DIFFERENCES 2005
£000 £000 £000 £000
Cash at bank and in hand 8,713 3,317 84 12,114
Bank overdraft – (892) (11) (903)
Cash 8,713 2,425 73 11,211
Finance leases (112) 71 – (41)
NET FUNDS 8,601 2,496 73 11,170
2005 2004
£000 £000
Increase in cash in the year 2,425 4,117
Cash outflow from decrease in lease financing 71 102
Change in net funds resulting from cash flows 2,496 4,219
Currency translation differences 73 (334)
Movement in net funds in year 2,569 3,885
Net funds at start of the year 8,601 4,716
Net funds at end of the year 11,170 8,601
24 ANALYSIS AND RECONCILIATION OF NET FUNDS
Major non-cash transactions
In connection with the acquisition of AVEVA AB, 789,655 ordinary shares of 10p each were issued as part of the consideration 
(see note 12).
E x ceptional items
Net cash inflow from operating activities includes cash outflows of £1,463,000 in respect of restructuring costs.
25 GUARANTEES AND OTHER FINANCIAL COMMITMENTS
a ) P ension arrangements
(i) UK defined benefit scheme
SSAP24 disclosures
The group operates a UK defined benefit pension plan providing benefits based on final pensionable pay. This scheme was closed to new
employees on 30 September 2002 (with the option of re-opening if required) and was converted to a Career Average Revalued Earnings 
basis on 30 September 2004. Administration on behalf of the members is governed by a Trust Deed, and the funds are held and managed 
by professional investment managers who are independent of the group.
Contributions to the scheme are made in accordance with advice from an independent professionally qualified actuary at rates which are 
calculated to be sufficient to meet the future liabilities of the scheme. The employees' contributions are fixed as a percentage of salary, 
the balance being made up by the employer.
The most recent actuarial valuation was carried out as at 1 April 2004 using the projected unit method with a three year control period.
Under this method the current service cost will increase as members approach retirement age.
The valuation for SSAP 24 purposes was carried out at a later date to that used for the FRS 17 valuation at 31 March 2004 and included
assets and liabilities transferred in from a third party pension scheme in July 2004 relating to an acquisition in 1999 following final
agreement of the transfer value.
The assets of the scheme were taken into account at a market value. Consistent with this, the liabilities were valued using financial 
assumptions derived from yields on index-linked and fixed interest government securities. AVEVA Annual Report 2005 Notes to the financial statements 59
In particular, the main actuarial assumptions were that:
a) the return on scheme investments would be 5.75% per annum;
b) future inflation would be 2.75% per annum;
c) pensions in payment earned from 6 April 1997 would increase by 2.75% per annum.
The deficit identified at the 2004 valuation, amounting to £4,158,000, is expected to be eliminated over the period to 2020 through
increased employer contributions.
The market value of the assets of the scheme was £17,974,000 and represented 81% of the benefits that had accrued to members after
allowing for expected future increases in benefits.
The pension charge for the defined benefit schemes in the UK amounted to £1,127,000 (2004 - £1,137,000).
FRS 17 disclosures
Additional disclosures regarding the group’s UK defined benefit pension scheme are required under the transitional provisions of FRS 17
“Retirement benefits” and these are set out below. The valuation used for FRS 17 disclosures has been based on the most recent actuarial 
valuation at 1 April 2004, as updated to 31 March 2005 by a qualified independent actuary, to take account of the requirements of FRS 17 in
order to assess the liabilities of the scheme at 31 March 2005 and 2004. Scheme assets are stated at their market values at the respective
balance sheet dates.
2005 2004 2003
% % %
Main assumptions:
Rate of salary increases 4.75 4.75 4.50
Rate of increase of pensions in payment 2.75 2.75 2.50
Rate of increase of pensions in deferment 2.75 2.75 2.50
Discount rate 5.40 5.50 5.50
Inflation assumption 2.75 2.75 2.50
The assets and liabilities of the scheme and the expected rates of return at 31 March 2005 are:
2005 2004 2003
LONG-TERM RATE LONG-TERM RATE LONG-TERM RATE
OF RETURN OF RETURN OF RETURN
EXPECTED VALUE EXPECTED VALUE EXPECTED VALUE
% £000 % £000 % £000
Equities 6.70 17,100 6.70 14,300 6.60 10,300
Bonds 4.70 1,700 3.70 1,500 3.60 1,700
Properties 6.70 100 – – – –
Other 3.75 1,700 3.00 700 2.75 600
Total market value of assets 20,600 16,500 12,600
Present value of scheme liabilities (25,500) (25,000) (25,000)
Pension liability before deferred tax (4,900) (8,500) (12,400)
Related deferred tax asset 1,500 2,600 3,700
Net pension liability (3,400) (5,900) 8,700 AVEVA Annual Report 2005 Notes to the financial statements 60
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
25 GUARANTEES AND OTHER FINANCIAL COMMITMENTS CONTINUED
An analysis of the defined benefit cost for the year ended 31 March 2005 is as follows:
2005 2004
£000 £000
Current service cost 1,300 1,400
Past service credit (3,100) –
Total operating charge (1,800) 1,400
Expected return on pension scheme assets 1,100 800
Interest on pension scheme liabilities (1,300) (1,400)
Total other finance cost (200) (600)
Actual return less expected return on pension scheme assets 700 2,000
Experience gains and losses on liabilities 800 –
Changes in assumptions (600) 2,800
Actuarial gain recognised in the statement of total recognised gains and losses 900 4,800
2005 2004
£000 £000
Analysis of movements in the deficit during the year:
At 1 April 2004 (8,500) (12,400)
Current service costs (1,300) (1,400)
Total other finance cost (200) (600)
Actuarial gain 900 4,800
Past service credit 3,100 –
Contributions 1,100 1,100
At 31 March 2005 (4,900) (8,500)
The scheme became a Career Average Revalued Earning Scheme on 1 October 2004. Member contributions also increased at this date from 5.25%
to 7.5% of pensionable salary. The company contributions remained at 18.5% of pensionable salary.  AVEVA Annual Report 2005 Notes to the financial statements 61
History of experience gains and losses:
2005 2004 2003
Difference between expected return and actual return on pension scheme assets:
– amount (£000) 700 2,000 (5,000)
– % of scheme assets 3% 12% (40%)
Experience gains arising on scheme liabilities:
– amount (£000) 800 – –
– % of the present value of scheme liabilities 3% – –
Total actuarial gain/(loss) recognised in the Statement of total recognised gains and losses:
– amount (£000) 900 4,800 (8,400)
– % of the present value of scheme liabilities 4% 19% (34%)
Reconciliation of net assets and reserves under FRS 17:
2005 2004
NET ASSETS - GROUP £000 £000
Net assets as stated in the balance sheet 43,570 21,570
FRS 17 defined benefit liabilities (3,400) (5,900)
Net assets including defined benefit liabilities 40,170 15,670
2005 2004
RESERVES - GROUP £000 £000
Profit and loss reserve as stated in the balance sheet 13,122 11,613
FRS 17 defined benefit liabilities (3,400) (5,900)
Profit and loss reserve including amounts relating to defined benefit liabilities 9,722 5,713
(ii) Defined contribution schemes
The group also operates defined contribution schemes for UK, Swedish, US, German, French, Norwegian and Asian Pacific employees for 
which the pension charge for the year amounted to £1,261,000 (2004 - £438,000).
(iii) Overseas retirement schemes
The group operates the following overseas retirement schemes:
Sweden
All Swedish employees employed by AVEVA AB aged twenty-eight or over are members of the “ITP”, an industry scheme for salaried employees
which provides benefits in addition to the state pension arrangements. The ITP scheme is managed by Alecta, a Swedish insurance company. 
It is a multi-employer defined benefit scheme with a supplementary defined contribution component. AVEVA AB pays monthly premiums to the
insurers which vary by age, service and salary of the employee. AVEVA AB is unable to identify its share of the underlying assets and liabilities in
the scheme and therefore has accounted for the scheme as if it was a defined contribution pension scheme. At 31 March 2005, Alecta’s surplus
in the form of collective funding level was 131%. 
Historically AVEVA AB did not finance ITP benefits through insurance companies. Instead the benefits were unfunded and were financed by 
a combination of book reserves and re-insurance. These liabilities relate to certain historically earned benefits and are being gradually transferred
to Alecta over the period to February 2006. The book reserves are maintained and calculated by the Pension Regulation Institute. The provision
at 31 March 2005 was £226,000, which has been included in provisions for liabilities and charges on the balance sheet (see note 18). AVEVA Annual Report 2005 Notes to the financial statements 62
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
25 GUARANTEES AND OTHER FINANCIAL COMMITMENTS CONTINUED
South K orea
South Korean employees are entitled to a lump sum on retirement or termination of employment equal to one month’s salary for each year of
service. All employees are eligible. At 31 March 2005 the provision was £232,000, which has been included in provisions for liabilities and
charges on the balance sheet (see note 18).
Germany
Tribon Solutions GmbH operates an unfunded defined benefit scheme that provides benefits to five deferred members following an acquisition in
1992. No current employees participate in the scheme and it is closed to new applicants. The scheme is financed by book reserves and benefit
payments are made as they fall due. An FRS 17 valuation of the pension liability has been carried out using the following assumptions:
Rate of increase of pensions in payment 0%
Discount rate 5.5%
Inflation assumption 0%
The service cost and interest cost for the period from date of acquisition (19 May 2004) to 31 March 2005 was £nil and £17,000 
respectively. The FRS 17 valuation of pension liability at 31 March 2005 was £404,000 which has been included in provisions for liabilities and
charges on the balance sheet (see note 18).
b ) Lease commitments
At 31 March 2005 the group had annual commitments under non-cancellable operating leases as follows:
c ) Capital commitments
At the end of the year the group and company had capital commitments contracted for but not provided for of £23,000 (2004 - £123,000).
26 RELATED PARTY TRANSACTIONS
There were no transactions with related parties in either year that require disclosure within these financial statements.
2005 2004
LAND AND PLANT AND LAND AND PLANT AND
BUILDINGS MACHINERY BUILDINGS MACHINERY
£000 £000 £000 £000
Expiring within one year 234 47 416 203
Expiring between two and five years 743 219 104 44
Expiring in more than five years – – 327 –
977 266 847 247 AVEVA Annual Report 2005 Five year record 63
FIVE YEAR RECORD
2005 2004 2003 2002 2001
£000 £000 £000 £000 £000
Summarised consolidated results:
Turnover 57,543 38,113 36,008 31,818 28,100
Gross profit 38,464 25,525 22,961 20,230 19,061
Operating profit before amortisation and exceptional items 10,765 6,756 6,237 5,561 5,759
Exceptional items (2,287) – – – –
Intangible asset amortisation (2,683) (619) (619) (637) (602)
Operating profit 5,795 6,137 5,618 4,924 5,157
Taxation (2,882) (2,199) (1,922) (1,573) (1,722)
Profit for the financial year 2,882 3,910 3,658 3,365 3,503
Earnings per share 13.48p 22.63p 21.46p 19.82p 20.80p
Adjusted earnings per share 36.71p 26.20p 25.10p 23.57p 24.38p
Total dividend per share 6.1p 5.8p 5.6p 5.4p 5.4p
Summarised consolidated balance sheet:
Fixed assets 33,119 8,336 8,583 8,307 8,652
Cash and liquid resources 11,211 8,713 4,930 6,356 5,620
Net current assets 12,137 13,610 10,583 8,523 5,668
Shareholders funds: all equity 43,570 21,570 18,582 16,297 13,730 COMPANY INFORMATION AND ADVISORS
DIRECTORS Richard King CBE
Chairman
Richard Longdon
Chief Ex ecutive
Paul Taylor
Finance Director
Colin Garrett
Non-Ex ecutive Director
David Mann 
Non-Ex ecutive Director
SECRETARY Paul Taylor
REGISTERED OFFICE High Cross
Madingley Road
Cambridge CB3 0HB
REGISTERED NUMBER 2937296
AUDITORS Ernst & Young LLP
Compass House
80 Newmarket Road
Cambridge CB5 8DZ
BANKERS Barclays Bank plc
15 Bene't Street
Cambridge CB2 3PZ
LAWYERS Ashurst
Broadwalk House
5 Appold Street
London EC2A 2HA
Mills and Reeve
Francis House
112 Hills Road
Cambridge CB2 1PH
STOCKBROKER AND Hoare Govett Ltd
FINANCIAL ADVISORS 250 Bishopsgate 
London EC2M 4AA
REGISTRARS Capita Registrars
Bourne House
34 Beckenham Road
Beckenham, Kent BR3 4TU
GLOBAL LOCATIONS
Locations
• Bangalore, India
• Calgary, Canada
• Cambridge, UK
• Dubai, UAE
• Frankfurt, Germany
• Genova, Italy
• Guangzhou, China
• Hamburg, Germany
• Hong Kong
• Houston, USA
• Kil, Sweden
• Kuala Lumpur, Malaysia
• Lyon, France
• Lysaker, Norway
• Malmö, Sweden
• Manchester, UK
• Osaka, Japan
• Paris, France
• Perth, Australia
• Portsmouth, UK
• Saudi Arabia
• Seoul, Korea
• Shanghai, China
• Sheffield, UK
• Singapore
• Stavanger, Norway
• Wilmington, USA
• Yokohama, Japan