Lombard Risk Management plc Annual report and accounts 2014
Managing collateralised trading.
Enabling regulatory compliance.
Lombard Risk Management plc Annual report and accounts 2014
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Overview
01 Highlights
02 Overview
Chairman’s statement
05 Chairman’s statement
Strategic report
07 Chief Executive Officer’s statement
08 Strategy and Review of Main Activities
Governance
14 Board of Directors
16 Corporate governance report
19 Directors’ report
21 Report of the Audit Committee
22 Report of the Remuneration Committee
Financial statements
24 Independent auditor’s report
25 Consolidated statement of comprehensive income
26 Consolidated balance sheet
27  Consolidated statement of changes in 
shareholders’ equity
28 Consolidated cash flow statement
29 Notes to the consolidated financial statements
52 Independent auditor’s report
53 Company balance sheet
54 Notes to the Company financial statements
IBC Company information
Visit www.lombardrisk.com 
for up‑to‑the‑minute news 
and investor information
For over twenty‑ five years, Lombard 
Risk has delivered industry‑leading 
risk management and regulatory 
compliance solutions to the financial 
services industry and large corporations 
around the world.
More recently, Lombard Risk has expanded its portfolio of 
technology solutions to include collateral optimisation, 
compliance monitoring and advanced XBRL functionality
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01
Chairman’s statement Governance Financial statements Overview Strategic report
Highlights
5.0
(1.6)
1.3
2.5
3.7
2010 2011 2012 2013 2014
Total comprehensive income
+35%
£5.0m
  Revenues £20.4m (2013: £16.8m), of which second half £13.1m (2013: £9.0m)
   EBITDA £6.0m (2013: £5.3m)
  Profit before tax £4.4m (2013: £3.9m)
  Cash at end of period £2.9m (2013: £1.9m) with net cash
(1)
 of £2.3m (2013: £0.2m)
  A further 34 contracts signed for COREP, of which 16 are new names
  Significant sale of COLLINE
®
 to a Tier 1 bank in December 2013
  FY 2015 opens with record year-end order book in place
  Final dividend 0.045p per share (2013: 0.040p per share) recommended 
to shareholders
  The Board continues to view the future with optimism
(1)
 Cash less total bank borrowings. Bank borrowings were £0.7m (2013: £1.7m).
20.4
8.9
11.8
12.8
16.8
2010 2011 2012 2013 2014
Revenue
+22%
£20.4m
2010 2011 2012 2013 2014
Adjusted net cash/(debt)
+£2.1m
£2.3m
2.3
0.7
1.8
(2.4)
0.2
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02
Overview
Overview
The Lombard Risk integrated product suite enables financial 
institutions to meet risk and regulatory requirements now 
and as they continue to evolve.
We are committed to providing innovative specialised products that stay a step ahead of 
complex collateralised trading demands, changing market conditions, increasing regulatory 
challenges, on-going financial and operational risk pressures, and a host of other financial 
compliance mandates.
Products
Lombard Risk has two key divisions, namely Risk Management and Regulatory Compliance. The main software products 
within these divisions are:
RISK MANAGEMENT DIVISION –  
53% OF GROUP REVENUES IN FY 2014 (2013: 53%)
REGULATORY COMPLIANCE DIVISION –  
47% OF GROUP REVENUES IN FY 2014 (2013: 47%)
COLLINE
®
Collateral management, clearing and inventory management and optimisation. End-to-end, 
cross-product collateral management. COLLINE provides a consolidated solution for mitigating 
exposure risk while satisfying the growing demand for multiple/global entities for cross-product 
margining, clearing, inventory management and optimization on a single platform, master netting, 
MIS reporting, dispute management and electronic messaging.
ComplianceASSESSOR
A web-based compliance and audit application that allows firms to manage their on-going 
compliance with regulations and produce multiple reports around the related compliance risks.
OBERON
®
Valuation and risk of derivatives and other financial products.
OBERON
®
 also had a good year and remains a commercially successful product. 
REPORTER
Global regulatory reporting. Scalable regulatory compliance solution for branch or head office, 
with global coverage. Market-leading position in UK (ie FCA and PRA reporting).
REG-Reporter 
US and Canadian regulatory reporting. Regulatory solution addressing financial reporting 
requirements by automating compliance with the mandated reports to all US regulatory agencies 
and the Office for the Superintendent of Financial Institutions (OSFI), Canada. Market leader for 
reporting by foreign banks in the US.
LISA
Scenario analysis and stress testing.  Satisfies the latest liquidity risk management requirements and 
supports growing regulatory demands for timely and reliable information.
REFORM
™
A powerful and configurable platform for real-time, high-volume regulatory transaction reporting – 
with seamless connectivity to integrate banking, exchange and regulatory systems.
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03
Strategic report
We employ over 270 
people across the globe 
and have clients in the 
UK, mainland Europe, Africa, 
the Middle East, the Americas 
and Asia Pacific.
Every staff member is valued for 
his or her contribution to our 
ability to deliver the very best 
products and services for our 
clients.
We also offer services in 
the form of training, support, 
consulting and implementation 
and deployment related to 
our products.
GLOBAL PRESENCE
TALENT
SERVICE SELECTION
Chairman’s statement Governance Financial statements Overview Strategic report
San Francisco
London (HQ)
Atlanta
Miami
India
Hong Kong
Singapore
Shanghai
Tokyo
Luxembourg
South Africa
Our locations
Lombard Risk is headquartered in London, employs over 270 people 
and is rapidly expanding, and operates globally via subsidiaries, 
who both develop and deliver its products and a range of services.
 Offices
 Representation
Our qualities
New York
New Jersey
Leeds
Glasgow
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04
Overview
Our strategy has allowed us to create award-winning global 
solutions
Innovation
Industry-leading products 
provide risk and regulatory 
solutions for global financial 
services operations
  W h at ma k e s 
us different
Expertise
Significant pool of business 
practitioners and experienced 
implementation consultants
Agility
Adaptable and flexible 
business model to suit our 
clients’ requirements (eg term 
licence or annual subscription)
Scalability
Ability for solutions to be 
attractive to organisations 
of any size; significant data 
processing is not an issue
Scalability
Innovation
Expertise
Agility
Provide
Satisfy
Maintain
Implement
Dedicated to 
managing risk 
and regulatory  
compliance
3
2
1
1
 To a global market
Lombard Risk delivers industry-leading risk management 
and regulatory compliance solutions to the financial 
services industry and large corporations around the world.
Our proven global solutions reduce the risk inherent 
in collateralised trading operations, enable firms 
to measure and manage liquidity and meet the 
demands of global regulators.
Our 300+ clients include over 30 of the world’s “Top 50” 
banks, nearly half of the banks operating in the UK 
(where our corporate headquarters is located), as well 
as industry-leading banking businesses, investment firms, 
asset managers, hedge funds, fund administrators 
and large corporations worldwide.
  Delivered through our 
product and services cycle
Our model is to provide high quality technology 
solutions, either directly or through our partners; 
implement solutions, usually alongside the customer; 
provide on-going support; and maintain the product 
to a high technical specification and, where applicable, 
to satisfy up-to-date regulatory requirements.
All stages have opportunities for revenue growth:
New and 
detailed 
regulations 
continue to 
surface, eg 
FINREP, 
FR-Y14
New products 
and modules 
to current 
products
Convergence 
of risk and 
regulation 
– increased 
value added 
from industry 
practitioners
Further 
revenue 
visibility 
backlog and 
recurring 
revenues 
continue
2 3
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05
Financial statements Overview Chairman’s statement Strategic report Governance
Chairman’s statement
In summary
 Revenue £20.4m (2013: £16.8m)
 Healthy order book and revenue visibility
  Major contract for COLLINE
®
 to supply 
a Tier 1 bank
  Regulatory requirements increasing in the 
management of collateral risk
 New senior sales resources recruited
  The Board remains optimistic for the 
future outlook of the Group
I am pleased to report another good year for Lombard Risk. 
The Group posted progressive financial results and further 
broadened and enhanced its product portfolio.
Results
In the year the Group achieved strong financial results in both 
its Regulatory Compliance and Risk Management divisions. 
This performance, following a number of years of strong 
growth, is testament to the continuing expansion of 
regulation in global financial markets.
In the year we saw our revenue increase by 22%, giving a 
four-year compound annual growth rate of 23%. Annually 
recurring revenues made up 42% (2013: 43%) of total revenues. 
The Company took the opportunity to raise £2.5m net of 
fees through a placing of new shares to ensure the Group 
maintained a healthy balance sheet. 
Importantly, the Company closed a further 34 new contracts 
to provide its Common Reporting (“COREP”) solution for the 
European Banking Authority during the twelve month period 
to 31 March 2014, giving a total of 67 COREP clients. Of these 
67, 27 are new clients. A further success was the contract to 
supply our COLLINE
®
 collateral management software to a 
Tier 1 bank.
We continued to invest strategically in technology and 
infrastructure to scale our business to ensure we are best 
positioned to maximise future revenue opportunities and 
sustain the Group’s growth.
Profits have been realised in line with our expectations; 
this was despite the sales success resulting in the need for 
additional resources to satisfy our clients’ product 
implementation needs.
Chairman’s statement
In the year we saw our revenue increase 
by 22%, giving a four-year compound 
annual growth rate of 23%.”
Philip Crawford
Chairman
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06
Chairman’s statement
Dividend
On the back of the progressive financial performance, the 
Board proposes a final dividend of 0.045p per share which, if 
approved, will be paid on 25 July 2014 to those shareholders 
on the register on 11 July 2014. This brings the dividend for 
the year to 0.075p per share (2013: 0.065p per share), an 
increase of 15%.
Strategy
The Group enjoyed a strong performance from its direct 
sales function in Europe. This year, the Board intends to 
replicate this growth in the Americas and Asia Pacific. In 
addition, the Board is focussing on expanding its partner 
network to increase its indirect sales performance.
The intellectual property of the Group remains a key asset. 
The Group is perceived as a market leader by many in its core 
markets. In the future, the Group intends to leverage this 
market position to drive sales. This objective will be supported 
by our recent recruitment of further experienced senior sales 
executives. Additional investment in technology development 
is being made to support the sales drive.
Employees
During the year, I have made a conscious effort to connect 
with many of the Group’s valued employees. The diverse 
nature of the employees, their market knowledge, enthusiasm, 
commitment and desire reassure me that the Group possesses 
a deep level of talent.
On behalf of the Board, I would like to thank all the 
employees for their valued contribution. 
Board of Directors
Since the Annual General Meeting held in 2013 
we have appointed Steve Rogers and John McCormick 
as Non-executive Directors, effective August 2013 and 
November 2013 respectively. These appointments have 
added considerable relevant experience to the Group.
In February 2014, Paul Tuson, the Company’s CFO, resigned. 
He left in May 2014 after serving three months’ notice. On behalf 
of the Board, I would like to thank Paul for his valued contribution 
to the growth, governance and well-being of the Group 
during his three-and-a-half-year tenure. The Board is actively 
seeking a suitable replacement.
Outlook
The Board looks forward to the forthcoming year with 
continuing optimism. The unrelenting macro-regulatory 
environment in the financial industry persists. This, together 
with the addition of the sales drive and the healthy £5.2m 
order book of contracted licence and professional services, 
gives the Board comfort of further growth progression.
AGM
The Annual General Meeting will be held at the Company’s 
London office at 9.30am on Wednesday 9 July 2014. 
My fellow Directors and I look forward to meeting 
shareholders at that time.
Philip Crawford
Group Non-executive Chairman
12 May 2014
Chairman’s statement
continued
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Governance Financial statements Strategic report Chairman’s statement Overview
Strategic report
In summary
  Revenue increased by 22% to £20.4m 
(2013: £16.8m), of which £13.1m was 
in the second half (2013: £9.0m)
 EBITDA increased to £6.0m (2013: £5.3m) 
  Profit before tax increased to £4.4m 
(2013: £3.9m)
  Record revenues both from Regulatory 
and Collateral businesses
  67 UK COREP contracts signed – 
27 from new clients – and major 
COLLINE
®
 deal signed
  Good foundations laid for Alliances 
Programme 
The year was another record year both for revenue and profits, 
with 22% revenue growth, all of it organic revenue growth 
(2013: 31% revenue growth, of which 18% was organic 
revenue growth). The second half of the year was especially 
strong, and revenues were 44% higher than our previous 
record half year with £13.1m of revenue (2013 H2: £9.1m). 
EBITDA, adjusted for share-based payments, increased from 
£5.3m last year to £5.9m in the current year and profit before tax 
increased from £3.9m to £4.4m. Both profit before tax and 
revenues were ahead of market expectations. In addition 
to this strong revenue achievement we were also able to 
build a record revenue backlog/order book going into the 
new financial year. The drive to gain longevity of contractual 
commitment started in FY13 has continued with equivalent 
success in the current year.
The Group continues to benefit from having a strong market 
position in two important and growing segments of the 
financial industry, namely regulation and collateral 
management. The European Banking Authority’s initiatives 
such as COREP, FINREP and Asset Encumbrance have kept us 
extremely busy, and revenue from this will continue in the 
current financial year. Additional growth can also be 
expected to come from the Compliance area, where we have 
a new product, and from our increased use of alliances with 
major global firms or leading regional firms. Our professional 
services team is extremely busy billing its time to meet the 
COREP deadlines of seventy clients, but the programme is on 
track. As a result of all the above we remain confident of 
further growth in the new financial year and beyond. 
We invested appreciably during the year, both in product 
development and delivery capability and in further 
strengthening the sales team, including the appointment of 
a Global Sales Director. We expect research and development 
costs to reduce in the 2014/15 financial year as a percentage of 
revenues but at the same time it would be very short sighted 
not to invest in our future growth. There continue to be 
significant opportunities in our markets, some with regulatory 
deadlines associated with them, which demand further 
investment in product development and which the Board 
believes will contribute appreciably to future revenues. 
Indirect sales are expected to become an increasingly 
important part of our revenue model and again this should 
contribute to revenue growth.
No company achieves 22% revenue growth in a year without 
considerable effort by many of its team. I would like particularly 
to thank all those involved in EMEA regulatory for their efforts 
in selling and delivering almost 70 COREP projects. With 
numerous changes in the regulations during the consultation 
and legislative period, our teams involved have sometimes 
had to go more than the extra mile and this continues to be 
the case with key regulatory deadlines in June 2014. They 
deserve special thanks, although thanks are also due to all 
who contributed during the year.
During the year we conducted a placing and were able to 
welcome some exciting new names to our shareholder 
register. We are particularly pleased that Fidelity has become 
our largest institutional shareholder.
We enter the new financial year with our recurrent revenues 
at another all-time high of around £8.6m, our highest ever 
level of order book at £5.2m, and with a good sales pipeline.
Chief Executive Officer’s statement
We have now achieved compound annual 
revenue growth in the last four years of 
almost 23% p.a. and it is pleasing to have 
beaten market expectations on both 
revenue and profitability.”
John Wisbey
Chief Executive Officer
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08
Strategic report
Risk and regulatory disclaimer
For regulatory reasons the Board does not make external revenue or profit forecasts (although in common with most other quoted 
companies it does work with analysts who create market guidance) and while the Board clearly does plan to achieve optimum revenue 
and earnings growth through defining and implementing an appropriate strategy, nothing in this Strategic Report should be construed 
as the Board making revenue or profit forecasts, nor as any undertaking by the Board that its strategy and plans are in fact optimal 
in a future market, regulatory or competitive environment or that they will develop as projected. 
Principal activities
The Company is a holding company. The principal activities 
of the Group are the provision of trading, valuation and risk 
management systems, regulatory and transaction reporting 
systems and compliance systems to the financial markets, 
being banks, fund administrators, investment firms, asset 
managers, energy companies and other firms operating in 
financial markets and the wider financial industry.
What we do, what we plan to do and why
Lombard Risk is a global technology firm in the Governance, 
Risk Management and Compliance (“GRC”) space, with a 
special focus on collateral management, regulatory and 
compliance. We are a market leader in our chosen niches. 
With ever-increasing demands from regulators, GRC is one 
of the fastest growing areas in the financial industry and 
several investment banks visiting us have used the phrase 
“sweet spot”. The compound revenue growth rate of almost 
23% that we have achieved in the last four years is indicative 
of our strategy having worked in that period, and the Board 
has no current plan to diversify out of this area as we believe 
a lot of shareholder value can be obtained from continuing 
to focus on this area over the next few years. Indeed by 
achieving a consistently higher level of excellence in all the 
geographies we cover, leveraging our client relationships, 
developing our alliances programme further and continuing 
with our record of investing in winning products in our 
chosen market space, we believe that the rise in growth rate 
that we have achieved in the last four years can be continued 
or even exceeded with the caveat that there will inevitably be 
swings in growth rate owing to the cycle of regulatory 
change. Our main strategy at present is to grow through 
organic growth. We have, however, in the past made 
successful acquisitions and we hope to do so again in the 
future. Our appetite to make acquisitions will be a 
combination of the strategic product and client fit, the 
revenue and cost synergies, and, importantly, the achievable 
acquisition price in relation to our own share price. While our 
share price remains on lower revenue and earnings multiples 
than some of our targets’ expectations despite our having a 
higher growth rate, the Board’s willingness to dilute our own 
shareholders by issuing shares at the market price in order to 
pay a full price to a seller is necessarily limited. 
Key performance indicators
The Directors have monitored the performance of the 
Group with particular reference to the following key 
performance indicators:
•  turnover by product line and geography compared to 
prior year;
•  contractual order book and contract longevity;
•  utilisation and profitability of professional services against 
budgets and market norms;
•  cash management – actual compared to budget; and
•  operating costs by function as an absolute measure and as 
a proportion of revenues compared to prior periods, 
forecasts and market norms.
Turnover for both operating divisions, being Regulatory 
Compliance and Risk Management, were both in excess of 
20% higher than the prior year. The increase in revenues was 
predominantly in the UK and Asia Pacific.
Operating costs have been monitored and have increased 
consistently across both operating divisions. Resulting profits 
in the two divisions have both increased.
Financial review
The Group has continued the growth trend that has now 
been evident for several years. The Group enjoyed good 
revenue growth, with only Americas revenues falling below 
management expectations. Costs also increased as 
additional resources were required to fulfil development 
and implementation demands of the ever-expanding 
customer base.
Strategy and Review of Main Activities
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09
Governance Financial statements Strategic report Chairman’s statement Overview
Key performance indicators
Turnover by trading division (£m)
Regulatory 
Compliance  
division (47%)
Risk Management 
division (53%)
Turnover by geography (£m)
United Kingdom
The Americas
Asia Pacific
Rest of Europe, Middle 
East and Africa
2.9
2.3
2013 2014
15.8
12.6
2013 2014
0.7
0.6
2013 2014
5.3
4.3
2013 2014
Trade receivables
Administrative 
expenses
Trade payables
Investment in 
development
Working capital management (£m)
* Versus total revenue.
Cost
Revenue
Functional costs (fully expensed) expressed 
as a proportion of functional revenue (£m)
63%
30%
19%
26%
20.4
20.4
5.7
5.3 1.6
3.6
3.8
22% 20.4 4.6
5.4
Professional 
services
Support and 
maintenance
Sales and 
marketing*
Research and 
development
General and 
administration 
(including 
property costs)*
2014
2013
12.0
2.7
4.1
1.6
2014
2013
9.6
10.8
Year ended 31 March
2014 2013 2012
Revenue (including pro forma from acquired business for 2012) £20.4m £16.8m £14.2m
EBITDA with no capitalisation £0.6m £1.0m £(0.3)m
EBITDA including capitalisation £6.0m £5.3m £3.0m
Profit before tax with no capitalisation £0.2m £0.7m £(0.5)m
Profit before tax including capitalisation £4.4m £3.9m £2.5m
Total technology expenditure* £7.1m £6.1m £4.5m
Cash generated in operations with no capitalisation** £0.7m £1.0m £(1.5)m
* Includes research, development, testing, support and product maintenance.
** Operating profit less capitalised development costs adding back depreciation, amortisation and share-based payment charge.
Year-on-year trends
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10
Strategic report
Profit and loss
Revenues increased by 22% to a record £20.4m for the year, 
compared with £16.8m in the prior year. Licence revenues 
increased in the year by 14% to £9.4m (2013: £8.3m), 
representing 46% of revenues (2013: 49%). Recurring annual 
revenues totalled £8.6m, approximately 42% of revenue 
(2013: 43%), and now have a current annual run rate of £8.6m. 
Operating profit before share-based charges, depreciation 
and amortisation and acquisition costs (EBITDA) increased to 
£6.0m (2013: £5.3m). Profit before tax increased to £4.4m 
(2013: £3.9m).
The effective rate of tax for the year was a credit of 17% 
(2013: charge of 5%).The recognised deferred tax asset 
increased by £0.5m to £1.0m (2013: £0.5m) and the 
unrecognised deferred tax asset was £2.0m (2013: £0.7m).
Cash flow
Cash generated in operations was £5.2m (2013: £5.8m). 
As for many growth technology companies, the pressure on 
balancing working capital requirements with investing in 
longer-term growth continues. The Group produces weekly 
cash forecasts which are monitored closely. The decision to 
raise £2.6m in July 2013 ensured we were able to service the 
higher than anticipated new customer numbers and 
mitigated any risk of delays by regulatory authorities in 
finalising new reporting requirements. 
Investment in research and development expenditure that 
was capitalised was £5.3m (2013: £4.3m).
The Group raised £2.9m (net) (2013: £1.5m) with £0.4m 
(2013: £0.1m) resulting from the exercise of employee 
stock options. 
In April 2013, the Group settled the short-term bank loan of 
€400,000 that had been used for the early repayment of a 
loan note for US$550,000 that was repaid approximately one 
year early in December 2012 at a discount of US$83,000.
Overall there was a net cash inflow of £1.0m (2013: £1.7m).
Balance sheet
Non-current assets at 31 March 2014 increased to £18.0m 
(2013: £13.4m) predominantly the result of an increase in 
capitalised development costs.
Net cash at 31 March 2014 was £2.3m (2013: £0.2m) after 
total borrowings of £0.7m (2013: £1.7m).
Trade receivables were 14% of revenues at 31 March 2014, 
compared to 13% and 20% for 2013 and 2012 respectively.
Year-on-year trends
The capitalisation of development costs for the last three 
years inadvertently reduces the transparency of the financial 
performance of the Group. Internally, the Group’s operating 
budget and monthly management information measure financial 
performance assuming no capitalisation. The figures on page 9 
aid transparency and allow users to make a more informed 
assessment of the financial performance of the Group.
Business model
Products
Lombard Risk has two key divisions, namely Risk Management 
and Regulatory Compliance. The main software products 
within these divisions are:
i)  Risk Management division – 53% of Group revenues in FY 
2014 (2013: 53%): 
 a)  COLLINE® – OTC Collateral management, Repo, 
Securities Lending, Cash and Inventory Management, 
Optimisation. Market-leading position including several 
Tier 1 banks.
 b)  OBERON® valuation and risk of derivatives and other 
financial products
  COLLINE® had a successful year with many new prospects 
being worked on at the end of the financial year, some in 
conjunction with our partners. During the year we signed 
a major COLLINE® deal with a Tier 1 UK bank, and we also 
made inroads into the Japanese domestic market by signing 
We entered the new financial year with 
our recurrent revenues at another all-time 
high of around £8.6m, our highest ever 
level of order book at £5.2m, and with 
a good sales pipeline.”
Strategy and Review of Main Activities  
continued
Investment in product development
+26%
£5.4m
(2013: £4.3m)
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11
Governance Financial statements Strategic report Chairman’s statement Overview
a deal with a regional Japanese bank in conjunction with one 
of our partners. Much progress was made on making the 
product fully compliant with Dodd-Frank and EMIR and other 
IOSCO regulations, and with adding Optimisation to the 
product set. COLLINE® now has modules for OTC Collateral, 
Clearing, Repo, Securities Lending, Exchange Traded Funds 
and Optimisation, making it a very comprehensive offering. 
Not all our existing COLLINE® clients use all this functionality 
and this is an upsell opportunity and challenge for us. 
OBERON® also had a good year and remains a commercially 
successful product. 
ii)  Regulatory Compliance division – 47% of Group revenues 
in FY 2014 (2013: 47%)
 a)  REPORTER – Regulatory Reporting in multiple countries; 
market-leading position in UK (eg FCA and PRA reporting)
 b)  REG-Reporter – Regulatory Reporting in the US (eg FDIC, 
FRBNY reporting) and various countries in Americas; 
market leader for reporting by foreign banks in the US
 c)  LISA – stress testing of liquidity reporting
 d)  ComplianceAssessor – Product that allows firms to manage 
their on-going compliance with regulations and produce 
multiple reports around the related compliance risks.
  This year was an especially strong one for the REPORTER 
product in the UK. 67 client groups have so far signed up 
for our COREP solution, with a multiple of that for the exact 
number of legal entities. This number means that we were 
able to gain over thirty brand new clients, all of which will 
help our revenue model in future years. We also had a good 
year in Asia, with new clients signed up in Hong Kong and 
Singapore, including some important regional banks. In 
the US we were busy selling some of the new Federal 
Reserve reports to our existing REG-Reporter customers.
Clients and client geography
Many of the Company’s clients have operations across 
multiple countries. Overall we do business with around thirty 
of the top fifty banks in the world. In the UK we do business 
with over 140 separate banking groups, with the number of 
legal entities using our software considerably higher than 
that. Altogether we have clients in over 25 countries and in 
centres such as London and New York we have clients with 
parent companies or head offices in many more countries. 
We regard our client base and the associated relationships as 
a very important asset of the Group. We have had very few 
client losses over the past few years other than when a bank 
closes a UK or US branch and therefore ceases to need our 
services in that branch.
In FY 2014, 59% of our revenues were from the UK (2013: 
39%) and a further 13% from EMEA non-UK (2013: 28%).
This is not at all because we are a UK or EMEA focussed firm 
but because of our very strong position in the regulatory 
market in the UK and strong COLLINE
®
 revenue from the UK 
as a result of a Tier 1 contract win and other on-going 
COLLINE
®
 projects. 
We are making major investment in more quality people in 
the US as we believe that longer term the proportion of our 
revenues from the Americas could and should be nearer to 
40–50% as against the 20% in FY 2014 (2013: 25%). So 
while we expect the UK and the rest of EMEA to continue to 
grow this will account for a lower share of revenues as 
American revenues grow faster. We are also investing in 
additional sales and delivery resource and product for the 
Asia Pacific area which the Board recognises as a good 
opportunity for increased revenue, helped particularly by the 
credibility for Lombard Risk from a major delivery presence 
already established in China.
Total revenue
+22%
£20.4m
(2013: £16.8m)
Average compound revenue 
growth since 2011
23% p.a.
 
Net assets
+73%
£18.2m
(2013: £10.5m)
_0_LOM_ar14_Front.indd   11 16/06/2014   10:44:20 Lombard Risk Management plc Annual report and accounts 2014
12
Strategic report
Intellectual property
The intellectual property of the Group remains a key asset, 
enabling Lombard Risk to be a market leader in its chosen 
markets.
To maintain a market-leading position, the Group continues 
to invest in its intellectual property. The cost of development 
of innovative, function-rich, new technology is material to 
the Group’s finances. The Group capitalises these development 
costs, in line with and subject to the conditions of IAS 38. 
In FY 2014 the Group capitalised £5.3m.
In particular, during the current year, the Group has invested 
in developing a market-leading solution to satisfy the regulatory 
requirements of the European Banking Authority’s Common 
Reporting and in the new Optimisation module for the 
COLLINE
®
 product family. Development costs of £1.3m 
and £1.5m were capitalised respectively.
Personnel
We are headquartered in London, England, but 60% of our 
270 employees work outside the UK. Our development and 
testing centre is in Shanghai, China. We have offices in the 
US (New York and New Jersey), Hong Kong, Singapore and 
Tokyo with representatives in other centres. 
Inevitably people are our greatest asset and also by far our 
greatest expense with personnel costs being 79% of our cash 
cost base. Retaining key staff is always very important to us. 
We have been relatively successful in the UK in recruiting well 
and then retaining staff who we have identified as key, but we 
have been less successful in the US where we have made more 
recruitment mistakes on the non-regulatory side and then 
suffered higher staff turnover. We are hopeful that some recent 
leadership changes in the US will reverse this pattern there.
We have an extremely diverse employee base with 29 different 
nationalities employed and 94 female staff members and 
176 male staff members, being 35% and 65% of the staff 
respectively, which we believe is above average for a technology 
company where there are traditionally many more male than 
female applicants. It is an important principle for us to encourage 
talent and recruitment on merit without consideration of 
gender, race, age or sexual preference. For this reason we do 
not set targets for percentages of recruitment as we want to 
recruit the best candidate who applies for the job. Four of our 
twelve-person executive leadership team are female, although 
we do not have any female representation on the Board.
The main trends and factors likely to affect the future 
development, performance and position of the 
Group’s business
The key factors affecting the Group’s performance are 
expected to include the following:
a)  The regulation of the banking sector in particular but also 
of the wider financial industry. Broadly speaking there 
appears to us to be a multiple-year surge in regulation, 
and more firms are now in scope for regulation than 
before. We would expect to make more money with more 
regulation, unless the regulation becomes so onerous that 
clients close down or reduce the size of the businesses 
that we sell to. A return to light touch regulation would 
not be beneficial to the Group.
b)  The move to greater efficiency in banks. Banks have spent 
so much on tactical solutions for regulatory change that 
we believe they will start to look at the area more 
strategically in order to save money. We are investing 
to be in a position to take advantage of this.
c)  The speed and effectiveness with which the Group adapts 
to regulatory or market change. Clients are more likely to 
change system at a time of regulatory change. We have 
mostly been able to benefit from such regulatory change 
through gaining new clients, but if we failed to invest at a 
time of such regulatory change there would be a risk of 
the opposite occurring.
d)  Keeping our product set up to date functionally and 
technically. While it can take several years for clients to 
replace an ageing product that still does the job, new 
clients usually prefer to buy a product that meets their 
needs on day one or is expected to in a near timeframe.
e)  The effectiveness of our direct sales force, our client 
support and of our alliances strategy. Having the best 
product is often not enough, and it can be more important 
to have outstanding ability to support the client after a 
sale and to have a reputation for delivering as promised.
f)  Consolidation of the banking sector. In 2008 we saw as 
one of the greatest risks a large number of banks merging. 
Although this did take place among some of the largest 
banks, there has been less M&A activity than we expected, 
and indeed we have seen a number of new names emerging 
who have become clients for regulatory reporting.
g)  There are inevitably competitors and the identity of such 
competitors changes over the years as existing competitors 
rise or fall or are taken over and as new competitors 
emerge. The Group prefers to be in businesses where it 
can become one of the two or three market leaders in a 
niche and has been successful in this with COLLINE
®
 and 
with REPORTER and REG-Reporter
®
.
_0_LOM_ar14_Front.indd   12 16/06/2014   10:44:20 Lombard Risk Management plc www.lombardrisk.com
13
Governance Financial statements Strategic report Chairman’s statement Overview
5.0
(1.6)
1.3
2.5
3.9
2010 2011 2012 2013 2014
Total comprehensive income
+35%
£5.0m
20.4
8.9
11.8
12.8
16.8
2010 2011 2012 2013 2014
Revenue
+22%
£20.4m
2010 2011 2012 2013 2014
Adjusted net cash/(debt)
+£2.1m
£2.3m
2.3
0.7
1.8
(2.4)
0.2
Environmental issues
UK company law now requires that the Board of fully listed 
companies comments on this. Whilst the Group is not 
fully listed, we comment on this matter as we believe 
it is best practice to do so. As a financial technology business 
producing software for the financial industry the 
environmental impact of the Company is small. We do not 
pollute the environment and arguably our products save 
appreciable paper as we help our clients produce reports 
electronically rather than printing them out. Naturally with 
offices and clients in multiple countries our staff do take 
aeroplanes and this has an environmental impact.
Social community and human rights issues
UK company law now requires that the Board of fully listed 
companies comments on this. Whilst the Group is not fully 
listed, we comment on this matter as we believe it is best 
practice to do so. The Group has its offices in quite high-quality 
buildings in the main centres in which it operates, with relatively 
pleasant working conditions for employees, including dedicated 
computer equipment and air-conditioning. While the Group 
encourages a strong work ethic, typical working hours are in 
line with the norm for the country concerned. Extracurricular 
activities are proactively encouraged in the larger offices 
such as London and Shanghai, including, for example, 
charity runs or cricket or badminton. HR departments ensure 
an appropriate level of care for the welfare of employees as 
well as implement HR policies. 
The Company complies with the laws it is subject to in not 
trading in countries where this is prohibited by sanctions, 
and takes account of Foreign Office warnings on travel to 
dangerous areas. There will inevitably be cases where the 
Board or individual employees may disagree with, for 
example, aspects of the human rights record of the country 
concerned or the ethical standards, environmental, pollution 
or health effects of parts of corporations we deal with. 
The Board feels that such issues are more appropriately dealt 
with at governmental level or through regulators or the 
courts and would normally not restrict dealings by the 
Group with such entities or countries unless it became 
concerned about the reputational risk of not doing so.
Commercial outlook
We entered the new financial year with our recurrent 
revenues at another all-time high of around £8.6m, our 
highest ever level of order book at £5.2m, and with a good 
sales pipeline. There is continued new European regulation 
in the UK beyond COREP, such as FINREP and Asset 
Encumbrance, and also regulatory change in several of the 
countries in which we operate. Our Alliances programme is 
starting to become interesting with a number of 
opportunities being worked on. We have a new product, 
Compliance Assessor, which looks like a potential source of 
very useful new revenue. We have invested in a Global Sales 
Director and are strengthening the Americas operation. 
Taking all these factors into account the Board believes that 
the commercial outlook is favourable.
Risks
The Group’s main risks are incorporated in “The main trends and 
factors likely to affect the future development, performance 
and position of the Group’s business”, as detailed on page 12.
In addition the Group’s multinational operations expose it to 
financial risks that include market risk, credit risk, operational 
risk and liquidity risk. The Directors review and agree policies 
for managing each of these risks. These policies have remained 
unchanged from previous years and are detailed in note 16 
to the accounts.
The Strategic Report was approved by the Board on 12 May 2014 
and signed on its behalf by:
John Wisbey
Chief Executive Officer and Director
12 May 2014
_0_LOM_ar14_Front.indd   13 16/06/2014   10:44:20 Lombard Risk Management plc Annual report and accounts 2014
14
Governance
Board of Directors
The Group is run by its Board of Directors, which currently has 
five members, including a Non-executive Chairman and two 
Non-executive Directors, and meets regularly. The Non-executive 
Directors make a valuable contribution by bringing a breadth 
of business and relevant professional experience to the Board.
The Board has overall responsibility for the Group and there is a formal schedule of 
matters specifically reserved for decision by the Board. It is responsible for the overall 
Group strategy, acquisition and divestment policy, corporate policies, approval of 
major capital expenditure and consideration of significant capital matters.
Philip Crawford
Non-executive Chairman
Philip Crawford joined the Board of Lombard Risk in 2010. He has been 
working in the IT industry since 1983. Philip has held a number of senior 
positions in software, hardware and services companies including senior 
vice president of Oracle Corporation with membership of the executive 
board and Larry Ellison’s Strategy Council, president of EDS International 
with responsibility for all markets outside the US, chief executive of Bull 
UK and executive vice president and head of EMEA for i2 Technologies. 
Since retiring from full time employment in 2002, Philip has concentrated 
on his non-executive director portfolio and acts as a “business angel”. 
He is currently the chairman of Avanti Capital Plc and Crimsonwing Plc 
as well as being chairman and investor in a small number of private 
companies, mainly in the technology space.
John Wisbey
Chief Executive Officer
John Wisbey is the Chief Executive Officer of Lombard Risk, which he has 
led since its launch in 1989 with the introduction of OBERON
®
, one of the 
industry’s original software systems for financial instrument valuation and risk 
management. John has guided the Company’s organic growth through the 
creation and development of several successful products, initially OBERON
®
, 
followed by ValuSpread, a credit derivative data service (sold to Fitch in 2005), 
COLLINE
®
 for collateral management and, most recently ComplianceASSESSOR 
for Compliance Monitoring. In addition, John has been the principal architect 
of the Company’s inorganic growth, which includes the acquisitions of Open 
Image Systems in 1994 (later floated on AIM as IDOX plc in 2000) and STB 
Systems (now the core of Lombard Risk’s regulatory compliance business) in 
2005 and the REG-Reporter
®
 business of SOFGEN in 201 1. Today, under John’s 
leadership, Lombard Risk is an international leader in collateralised trading and 
regulatory compliance offering a wide range of products and services to 
multinational clients.
Prior to establishing Lombard Risk, John was head of option trading and 
a director in the Swap Group at Kleinwort Benson Limited. John acquired a 
broad foundation in the world’s financial markets and developed specialisations 
in derivatives and banking technology during his twelve years in the treasury 
division and banking division at Kleinwort Benson while based in London, 
Hong Kong and Singapore. John was also past chairman until 2005 
of IDOX plc, a former subsidiary of Lombard Risk and now a leading 
company in UK e-government.
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15
Financial statements Chairman’s statement Overview Strategic report Governance
Nick Davies
Chief Technology Officer
Nick Davies joined the Board of Lombard Risk in 2010 having joined the 
firm in 2008 as the Group’s CTO. As CTO, Nick has global responsibility 
for Lombard Risk’s technical vision as well as for the delivery and quality 
of all software products. At Lombard Risk Nick’s achievements include 
providing the architectural vision for the rearchitecture of the COLLINE
®
 
Collateral Management platform to provide additional business resilience 
and processing capacity capabilities. These architecture and design 
principles contributed to COLLINE
®
 winning its first Tier 1 enterprise client 
in early 2009. 
At JP Morgan he was the head of technology for three global businesses: 
Globeclear, Collateral Management and Global Trust. He oversaw the 
technical integration of the hedge fund acquisitions into the Alternative 
Investment group and was responsible for several high profile merger 
projects. He was responsible for the technical teams that architected and 
implemented the JP Morgan CommanD product servicing OTC derivatives.
Steve Rogers
Non-executive Director
Steve Rogers joined the Board in August 2013. He is head of sales for 
EMEA/LATAM at Microsoft Business Solutions based in the UK and was 
previously general manager, EMEA-North for Salesforce.com and general 
manager, EMEA for SAP’s business objects division as well as earlier 
positions at Oracle UK and IBM.
John McCormick
Senior Non-executive Director
John McCormick joined the Board in November 2013. John’s career has been 
mainly in banking, most recently sixteen years at Royal Bank of Scotland Group 
(RBS) where from 2008 – October 2013 he was chairman and CEO of RBS in 
Asia Pacific, an organisation of 14,000 people at its peak. John was responsible 
functionally for markets and international banking activities across Asia Pacific 
– India, Hong Kong, Taiwan, China, Malaysia, Indonesia, Thailand, Singapore, 
South Korea, Japan and Australia, with a focus on debt capital markets, 
risk management and global transaction services. Following the takeover 
of NatWest in March 2000, John was appointed global head of interest 
rate derivatives and financial futures. He oversaw the rapid and successful 
integration of these global business units previously under the corporate 
umbrellas of RBS, NatWest GFM and Greenwich NatWest. John’s earlier 
career included thirteen years at Bank of America and a period at Bank 
of Ireland. At Bank of America he managed the Bank of America EMEA 
derivative business and formed part of a triumvirate which managed 
the global swaps and derivative business in the 1990s.
_0_LOM_ar14_Front.indd   15 16/06/2014   10:44:24 Lombard Risk Management plc Annual report and accounts 2014
16
Governance
Corporate governance report
For the year ended 31 March 2014
The role of the Board
The Board is responsible for the overall management of the 
Group, its strategy and long-term objectives, having regard 
to the interests of shareholders and the protection and 
enhancement of shareholder value. The Board ensures that 
the necessary financial and other resources are made available 
to enable those objectives to be met, and that objectives are 
only set that are consistent with the anticipated financial and 
other resources. It has a schedule of matters reserved for its 
approval including, but not limited to, decisions on strategy 
and risk management, approval of budgets, acquisitions and 
disposals, major capital expenditure, legal and insurance issues, 
Board structure and the appointment of advisers. In some 
areas responsibility is delegated to committees of the Board 
or to the Executive within clearly defined terms of reference.
Once the strategic and financial objectives of the Company 
have been agreed with and set by the Board it is the role of 
the Chief Executive and the Executive team to ensure that 
through the day-to-day management of the Group’s 
business they are achieved.
All Directors are subject to election by the shareholders at 
the next general meeting following appointment to the 
Board and to annual re-election. The Executive Directors 
have service contracts, which are terminable upon periods 
between three and twelve months’ notice.
The names of the current Directors together with their 
biographical details are set out in the “About us” page 
within the Lombard Risk website. 
The Directors are given access to independent professional 
advice at the Group’s expense, when the Directors deem it is 
necessary in order for them to carry out their responsibilities.
The Board meets at least six times a year and the Audit 
Committee and Remuneration Committee normally meet on 
a formal basis twice a year. 
Note from the Chairman
 
Dear Shareholder,
The Board is committed to high standards of integrity 
and corporate governance and consistently seeks to 
apply the principles set out in the UK Corporate 
Governance Code (“the Code”) as judged appropriate 
by the Board for an AIM listed company.
We do not comply with the UK Corporate Governance 
Code. However, we have reported on our corporate 
governance arrangements by drawing upon best 
practice available, including those components of the 
UK Corporate Governance Code we consider to be 
relevant to the company and best practice.
We recognise the importance of diversity on the Board and 
during the year recruited two independent Non-executive 
Directors, Steve Rogers and John McCormick, with 
business backgrounds that supplement the remaining 
members of the Board. Brian Crowe retired from the 
Board as a Non-executive Director in July 2013 after 
serving since 2004.
In February 2014, Paul Tuson, Group CFO, resigned and 
left the Company in May 2014. The Board is actively 
seeking a suitable replacement.
The Company seeks to ensure it has an appropriate 
balance of Executive and Non-executive elements on 
its Board.
Philip Crawford
Chairman
12 May 2014
Executive Director
Non-executive Director
Board membership
Philip Crawford 
(Chairman)
Steve Rogers
(Non-executive 
Director)
John Wisbey 
(Chief Executive 
Officer)
John McCormick
(Non-executive 
Director)
Nick Davies
(Chief 
Technology 
Officer)
Audit Committee
Philip Crawford John McCormick 
(Committee 
Chairman)
Remuneration Committee
Philip Crawford 
(Committee 
Chairman)
Steve Rogers
John McCormick Steve Rogers
_1_LOM_ar14_Back.indd   1 16/06/2014   10:44:53 Lombard Risk Management plc www.lombardrisk.com
17
Chairman’s statement Overview Strategic report Financial statements Governance
17
The Board receives appropriate and timely information prior 
to each meeting, with a formal agenda and Board and 
committee papers being distributed before meetings take 
place. Any Director may challenge Group proposals and 
decisions are taken democratically after discussion. Any 
Director who feels that any concern remains unresolved after 
discussion may ask for that concern to be noted in the 
minutes of the meeting. Any specific actions arising from 
such meetings are agreed by the Board and then followed 
up by management. 
The Group maintains, for its Directors and officers, liability 
insurance for any claims against them in that capacity.
The Group has effective procedures in place to deal with 
conflicts of interest. The Board is aware of other 
commitments of its Directors and changes to these 
commitments are reported to the Board.
A summary of the Board’s main work in the year ended 
31 March 2014 includes:
− − approving a growth strategy including a fundraising to 
ensure that the Group was able to maximise the 
opportunity for the European Banking Authority’s COREP 
and related projects;
− − restructure of Americas business;
− − evaluation of external growth opportunities;
− − financial overview; and
− − corporate governance and compliance including selection 
of additional board members.
While the Board seeks to operate collaboratively between 
Executive and Non-Executive Directors in order to ensure 
the effective operation of the Board, there is a clear division 
between the formal responsibilities of the Directors as set 
out below.
Directors’ roles
The Chairman’s main role is to:
− − ensure good corporate governance;
− − lead the Board, ensuring the effectiveness of the Board 
in all aspects of its role;
− − ensure effective communication with shareholders; and
− − set the agenda for Board meetings in conjunction with the 
Chief Executive Officer and the Company Secretary, and 
ensure that all Directors are encouraged to participate fully 
in the activities and decision-making process of the Board.
The Chief Executive Officer’s main role is to:
− − lead the Company and provide the key recommendations 
to the board on corporate strategy;
− − run the Company on a day-to-day basis;
− − provide strategic direction to the Company’s 
management team;
− − set objectives for and review the performance of the 
Company’s management team;
− − play a key role in external client, partner and shareholder 
relationships;
− − be responsible, along with the Executive team, for 
implementing the decisions of the Board and its 
committees; and
− − be the Company spokesperson, communicating with 
external audiences, such as investors, analysts and 
the media.
Board length of service (years)
Philip Crawford
John Wisbey
John McCormick
Nick Davies
Steve Rogers
0 5 10 15 20 25
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18
Governance
Corporate governance report continued
For the year ended 31 March 2014
Directors’ roles continued
The Non-executive Directors’ main role is to:
− − challenge the opinions of the Executive Directors, provide 
fresh insight in terms of strategic direction and bring their 
diverse experience and expertise to the benefit of the 
leadership of the Group;
− − play a full part in ensuring good corporate governance;
− − assess the performance of the Chairman;
− − provide a sounding board for the Chairman and serve 
as an intermediary for the other Directors as necessary;
− − scrutinise the performance of the Executive Directors 
in terms of meeting agreed goals and objectives;
− − be available to shareholders if they have concerns which 
contact through the normal channels of Chairman, Chief 
Executive Officer or other Executive Directors has failed 
to resolve or for which such contact is inappropriate; 
− − monitor the reporting of performance;
− − assist the Executive Directors with high level external 
contacts where this is possible; and
− − ensure that the financial information, controls and systems 
of risk management within the Group are robust and 
defensible.
Internal controls
The Directors are responsible for the systems of internal 
control. Although no system of internal control can provide 
absolute assurance against material misstatement or loss, the 
Group’s systems are designed to provide the Directors with 
reasonable assurance that problems are identified on a 
timely basis and dealt with appropriately. The Board 
considers that there have been no substantial weaknesses in 
internal financial controls resulting in any material losses, 
contingencies or uncertainties and thus disclosable in the 
accounts. The Board has considered the need for an internal 
audit function and has concluded that there is no current 
need for such a function within the Company.
Accounting policies
The Board considers the appropriateness of its accounting 
policies on an annual basis. The Board believes that its 
accounting policies and estimation techniques are 
appropriate, in particular in relation to income recognition, 
research and development and deferred expenses.
Information
Board reports and papers are circulated to the Directors in 
advance of the relevant Board or committee meeting. These 
papers are supplemented by information specifically requested 
by the Directors from time to time. Minutes of Board and 
committee meetings are circulated to all Board members.
The Non-executive Directors receive monthly management 
accounts and regular management reports and information 
which enable them to scrutinise the Group’s and 
management’s performance against agreed objectives.
Shareholder relations and Annual General Meeting 
(“AGM”)
The Company recognises the importance of dialogue with all 
of its shareholders. The AGM is an opportunity to communicate 
with institutional and other shareholders. The outcome 
of the voting on AGM resolutions is disclosed by means 
of an announcement on the London Stock Exchange.
Additional information is supplied through the circulation 
of the interim report and the annual report and accounts. 
Lombard Risk Management plc maintains up-to-date information 
on the investor section of its website, www.lombardrisk.com.
Every shareholder receives a full annual report after each 
year end and has access to an interim report online after 
each half year end. Care is taken to ensure that any price 
sensitive information is released to all its shareholders, 
institutional and private, at the same time in accordance with 
London Stock Exchange requirements.
Board committees
Audit Committee
The Audit Committee is a committee of the Board chaired by 
John McCormick and also comprises Philip Crawford and 
Steve Rogers. The Report of the Audit Committee can be 
found on page 21.
Remuneration Committee
The Remuneration Committee is a committee of the Board 
chaired by Philip Crawford and also comprises John 
McCormick and Steve Rogers. The Report of the 
Remuneration Committee can be found on page 22.
Nominations Committee
The Directors do not consider that, given the size of the 
Board, it is appropriate at this stage to have a Nomination 
Committee. However, this will be kept under regular review 
by the Board.
Risk Committee
The Directors plan to form a Risk Committee during 2014 with 
membership from both Executive and Non-Executive Directors. 
_1_LOM_ar14_Back.indd   3 16/06/2014   10:44:53 Lombard Risk Management plc www.lombardrisk.com
19
Chairman’s statement Overview Strategic report Financial statements Governance
19
Directors’ report 
For the year ended 31 March 2014
The Directors submit their annual report together with 
the consolidated financial statements for the year ended 
31 March 2014.
Directors’ responsibilities
The Directors are responsible for preparing the annual report 
and the financial statements in accordance with applicable 
law and regulations.
Company law requires the Directors to prepare financial 
statements for each financial year. Under that law the Directors 
have elected to prepare consolidated financial statements in 
accordance with International Financial Reporting Standards 
(“IFRS”) as adopted by the European Union and Parent Company 
financial statements in accordance with UK Generally Accepted 
Accounting Practice (“UK GAAP”). Under Company law, 
the Directors must not approve the financial statements 
unless they are satisfied that they give a true and fair view 
of the state of affairs and profit or loss of the Company 
and Group for that period. In preparing these financial 
statements, the Directors are required to:
− − select suitable accounting policies and then apply 
them consistently;
− − make judgements and estimates that are reasonable 
and prudent;
− − state whether applicable IFRS and UK GAAP have been 
followed, subject to any material departures disclosed 
and explained in the financial statements; and
− − prepare the financial statements on the going concern 
basis unless it is inappropriate to presume that the 
Company will continue in business.
The Directors are responsible for keeping adequate 
accounting records that are sufficient to show and explain 
the Company’s transactions and that disclose with 
reasonable accuracy at any time the financial position of the 
Company and enable them to ensure that the financial 
statements comply with the Companies Act 2006. They are 
also responsible for safeguarding the assets of the Company 
and hence for taking reasonable steps for the prevention and 
detection of fraud and other irregularities.
Insofar as each of the Directors is aware:
− − there is no relevant audit information of which the 
Company’s auditor is unaware; and
− − the Directors have taken all steps that they ought to have 
taken to make themselves aware of any relevant audit 
information and to establish that the auditor is aware of 
that information.
The Directors are responsible for the maintenance and 
integrity of the corporate and financial information included 
on the Company’s website. Legislation in the UK governing 
the preparation and dissemination of financial statements 
may differ from legislation in other jurisdictions.
Capital management
The Group generally seeks to finance all operational 
financing requirements through cash flows generated from 
operating activities, although this may be supplemented 
through capital injections if mutually beneficial to the Group, 
current shareholders and prospective investors. The 
Company’s equity structure is set out in note 17 to the 
financial statements.
Management’s objectives with respect to managing capital 
include maintaining sufficient capital to enable the Group to 
implement its strategy going forward with an optimal level 
of external debt. Part of this strategy is to generate a positive 
return to investors, both through dividend income and 
capital growth.
Results and dividends
The audited financial statements for the year ended 
31 March 2014 are set out on pages 25 to 51. The Group’s 
profit for the year after taxation amounted to £5.2m 
(2013: £3.7m). The Directors propose a final dividend 
for the year of 0.045p (2013: 0.040p) per Ordinary Share 
of 0.5p for a total dividend of 0.075p (2013: 0.065p).
Directors and their interests
The Directors who served during the year and/or up to the 
date of this report and their beneficial interests in the 
Company’s Ordinary Share capital were as follows:
31 March 2014
Number
31 March 2013
Number
John Wisbey
1
100,627,617 102,195,117
Paul Tuson (resigned 12 February 2014) 2,960,000 1,760,000
Nick Davies 441,176 441,176
Philip Crawford 590,000 590,000
John McCormick (appointed 12 November 2013) 9,176,756 n/a
Steve Rogers (appointed 14 August 2013) — n/a
Brian Crowe (resigned 12 July 2013) n/a 5,825,000
1
  77,939,562 shares are owned directly. In addition John Wisbey is a beneficiary of Advanced Technology Trust which owns a further 22,132,500 shares. The balance, 555,555, 
is held by a third party.
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20
Governance
Directors’ report continued
For the year ended 31 March 2014
Directors and their interests continued 
In addition to these shareholdings listed on page 21, the Directors 
have been granted options over Ordinary Shares.
In accordance with best practice, all Directors will retire at 
the forthcoming Annual General Meeting (“AGM”) and, 
being eligible, will offer themselves for re-election.
Substantial shareholdings
As at 31 March 2014 the Company has been notified of the 
following interests in 3% or more of its issued share capital:
Number of shares % holding
John Wisbey 100,627,617 38.2
FIL Limited 22,383,264 8.5
Hargreave Hale Limited 12,160,000 4.6
Herald Investment Trust 11,299,992 4.3
National Bank of Canada 11,032,222 4.2
John McCormick 9,176,756 3.5
Legal & General Group plc 8,292,500 3.2
Research and development
Research and development expenditure incurred on the 
Group’s suite of products has been capitalised in line with 
the Group’s accounting policy in the relevant period. 
Amounts not capitalised have been expensed to the 
consolidated statement of comprehensive income.
Going concern
The financial statements have, as in previous years, been 
prepared on a going concern basis. 
The Directors are required by the Companies Act 2006 to 
prepare annual accounts that give a true and fair view and, 
as part of this, to decide if it is appropriate to prepare them 
on a going concern basis. In forming an opinion that the 
Company and the Group is a going concern, the Directors 
have taken particular note of the trading performance in the 
year ended 31 March 2014. This shows an improvement in 
the Group’s cash balance and stability in the Group’s profits.
The Directors have prepared cash flow forecasts for the 
period ending 30 June 2015 which show that the Company 
and Group have sufficient facilities for on-going operations. 
Whilst there will always remain some inherent uncertainty 
within the aforementioned forecasts, the Directors believe 
the Company and Group have sufficient resources to 
continue in operational existence for at least twelve months 
from the date of approval of these financial statements.
Accordingly the Directors continue to adopt the going 
concern basis in preparing the financial statements for the 
year ended 31 March 2014.
Auditor
A resolution to re-appoint Grant Thornton UK LLP as auditor 
and to authorise the Directors to agree its remuneration will 
be placed before the forthcoming AGM of the Company.
On behalf of the Board
John Wisbey
Director
12 May 2014
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21
Chairman’s statement Overview Strategic report Financial statements Governance
21
Report of the Audit Committee 
For the year ended 31 March 2014
Membership and meetings of the Audit Committee
The Audit Committee is a committee of the Board and is 
composed entirely of Non-executive Directors, whom the 
Board considers to be independent. The Audit Committee 
invites the Executive Directors and other senior managers 
to attend its meetings as appropriate.
During the year the Audit Committee was chaired by 
Brian Crowe before his resignation and by John McCormick 
since his appointment. The Audit Committee is considered 
to have sufficient, recent and relevant financial experience 
to discharge its functions. The Audit Committee invites others, 
including the external auditor, to attend its meetings 
as appropriate.
Role, responsibilities and terms of reference
The Audit Committee’s role is to assist the Board in the 
effective discharge of its responsibilities for financial 
reporting and internal control.
The Audit Committee’s responsibilities include:
− − reviewing the integrity of the annual and interim financial 
statements of the Group, ensuring they comply with legal 
requirements, accounting standards and the AIM Rules 
and any other formal announcements relating to the 
Group’s financial performance;
− − reviewing the Group’s internal financial control and risk 
management systems;
− − monitoring and reviewing the requirement for an internal 
audit function; and
− − overseeing the relationship with the external auditor, 
including approval of its remuneration, reviewing the 
scope of the audit engagement, assessing its 
independence, monitoring the provision of non-audit 
services and considering its reports on the Group’s 
financial statements.
Independence of external auditor
The Audit Committee keeps under review the relationship 
with the external auditor including:
− − the independence and objectivity of the external auditor, 
taking into account the relevant UK professional and regulatory 
requirements and the relationship with the auditor as a 
whole, including the provision of non-audit services;
− − recommending to the Board and shareholders the 
re-appointment or otherwise of the external auditor for 
the following financial period; and
− − the consideration of audit fees and any fees for 
non-audit services.
The current year is the sixth that Christopher Smith, the audit 
partner of the Company’s external auditor, Grant Thornton 
UK LLP, has been in post as Senior Statutory Auditor. In 
normal course, there would have been a rotation of Senior 
Statutory Auditor after a five-year period. The Committee 
felt, however, that given the Finance Director stepped down 
from the Board shortly before the annual audit, it was 
important to maintain continuity in Senior Statutory Auditor 
for a further year. The Committee is satisfied that this 
extension does not in any way prejudice the objectivity and 
independence of the Senior Statutory Auditor.
The Audit Committee develops and recommends to the 
Board the Company’s policy in relation to the provision of 
non-audit services by the auditor and ensures that the 
provision of such services does not impair the external 
auditor’s independence.
John McCormick
Chairman of the Audit Committee
12 May 2014
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22
Governance
Report of the Remuneration Committee 
For the year ended 31 March 2014 
Companies quoted on AIM are not required to provide a 
formal remuneration report. Therefore this report is provided 
for information purposes to give greater transparency to the 
way Directors and key management are remunerated.
Composition and role of the Remuneration Committee
The Board has established a Remuneration Committee 
which currently consists of Philip Crawford, Non-executive 
Chairman, who chairs the committee, John McCormick, 
Senior Non-executive Director, and Steve Rogers, 
Non-executive Director. The committee determines 
the specific remuneration packages for each of the 
Executive Directors and key management. No Director 
is involved in any decisions as to his own remuneration. 
Framework and policy on Executive Directors’ 
remuneration
The Group’s remuneration policy is designed to provide 
competitive rewards for its Executive Directors and key 
management, taking into account the performance of the Group 
and individual Executives, together with comparisons of pay 
conditions throughout the markets in which the Group operates. 
It is the aim of the committee to attract, retain and motivate 
high calibre individuals with a competitive remuneration package. 
It is common practice in the industry for total remuneration 
to be influenced by bonuses and long-term incentives.
The remuneration packages are constructed to provide a 
balance between fixed and variable rewards. Therefore 
remuneration packages for Executive Directors normally 
include basic salary, discretionary bonuses, long-term 
incentive awards and benefits in kind. In agreeing the level 
of basic salaries and annual bonuses the committee takes 
into consideration the total remuneration that Executive 
Directors could receive.
Basic salary
Basic salaries are reviewed on an annual basis. The committee 
seeks to establish a basic salary for each position, determined 
by individual responsibilities and performance, taking into 
account comparable salaries for similar positions in companies 
of a similar size in the same market.
Incentive arrangements
Annual discretionary bonuses
These are designed to reflect the Group’s performance 
taking into account the performance of its peers, the 
markets in which the Group operates and the Executive 
Directors’ contribution to that performance.
Long-term incentive awards
The Group operates an option scheme for qualifying staff, 
including Executive Directors. Options are granted over the 
Company’s shares that are capable of vesting not before the 
second anniversary of issue. The vesting period runs for three 
to five years from the date the options first vest. During the 
year ended 31 March 2014, options over 12,600,000 shares 
were awarded to participating staff, of which 2,750,000 
were awarded to Executive Directors.
Other benefits
Depending on the terms of their contracts, Executive 
Directors are entitled to contributions to pension plans, 
private medical insurance, permanent health insurance and 
life assurance.
Service contracts and notice periods
All Executive Directors have employment contracts which are 
subject to between three and twelve months’ notice from 
either the Executive or the Group, given at any time. 
Non-executive Directors
All Non-executive Directors have a remuneration agreement 
for an initial period of twelve months and thereafter on a 
rolling basis subject to three months’ notice by either the 
Non-executive Director or the Group, given at any time.
In the event of termination of their appointment they are not 
entitled to any compensation. 
Non-executive Directors’ fees are determined by the 
Executive Directors having regard to the need to attract high 
calibre individuals with the right experience, the time and 
responsibilities entailed and comparative fees paid in the 
market in which the Group operates. They are not eligible for 
pensions. They may be invited to participate in the Group’s 
option scheme.
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23
Chairman’s statement Overview Strategic report Financial statements Governance
23
Directors’ emoluments
The remuneration of each Director during the year ended 31 March 2014 is detailed in the table below:
 
Salary
£000
Benefits
£000
Bonus
£000
Gain on
share option
exercise 
and similar 
benefits 
£000
Total 
for year
ended
31 March
2014
£000
Total 
for year
ended
31 March
2013
£000
Pension
contribution
for year
ended
31 March
2014
£000
Pension
contribution
for year
ended
31 March
2013
£000
Executive
John Wisbey 218 3 45 — 266 216 — —
Paul Tuson 110 — 25 162 297 109 50 50
Nick Davies 140 — 80 317 537 131 24 23
Non-executive
Philip Crawford 45 — — — 45 45 — —
Brian Crowe 6 — — 53 59 21 — —
John McCormick 13 — — — 13 — — —
Steve Rogers 19 — — — 19 — — —
Total 551 3 150 532 1,236 522 74 73
Directors’ interest in performance share awards
Full details of outstanding performance share awards in the Company held by Executive Directors at 31 March 2014 are 
shown below:
Share options At start of year Price paid Exercise price At end of year
Date from 
which exercisable Expiry dates
Brian Crowe 800,000 5.5p 5.5p — 14/01/2013 14/01/2016
Paul Tuson 2,400,000 5.5p 5.5p — 14/01/2013 14/01/2016
Nick Davies 1,000,000 6.0p 6.0p — 20/06/2010 20/06/2013
Nick Davies 3,600,000 4.5p 4.5p — 28/05/2012 28/05/2015
Nick Davies — — 11.0p 2,000,000 27/08/2013 27/05/2017
Nick Davies — — 11.0p 2,000,000 27/08/2015* 27/08/2018
Philip Crawford 2,400,000 — 4.5p 2,400,000 28/05/2012 28/05/2015
Philip Crawford 600,000 — 5.5p 600,000 14/01/2013 14/01/2016
John McCormick — — 13.0p 1,000,000 01/11/2015* 01/11/2018
Steve Rogers — — 13.0p 1,000,000 15/08/2015* 15/08/2018
* Options exercisable 60% date stated, 20% one year later and 20% two years later.
2,000,000 share options granted to Nick Davies were modified during the year under review; further details are given in note 18.
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24
Financial statements
Independent auditor’s report 
Consolidated financial statements
Independent auditor’s report to the members 
of Lombard Risk Management plc
We have audited the consolidated financial statements 
of Lombard Risk Management plc for the year ended 
31 March 2014 which comprise the Consolidated statement 
of comprehensive income, the Consolidated balance sheet, 
the Consolidated statement of changes in shareholders’ equity, 
the Consolidated cash flow statement and the related notes. 
The financial reporting framework that has been applied in 
their preparation is applicable law and International Financial 
Reporting Standards (“IFRS”) as adopted by the European Union.
This report is made solely to the Company’s members, 
as a body, in accordance with Chapter 3 of Part 16 of the 
Companies Act 2006. Our audit work has been undertaken so 
that we might state to the Company’s members those matters 
we are required to state to them in an Auditor’s report and 
for no other purpose. To the fullest extent permitted by law, 
we do not accept or assume responsibility to anyone other 
than the Company and the Company’s members as a body, 
for our audit work, for this report, or for the opinions we 
have formed.
Respective responsibilities of Directors and auditor
As explained more fully in the Directors’ responsibilities 
statement set out on page 19, the Directors are responsible 
for the preparation of the consolidated financial statements 
and for being satisfied that they give a true and fair view. 
Our responsibility is to audit and express an opinion on the 
consolidated financial statements in accordance with applicable 
law and International Standards on Auditing (UK and Ireland). 
Those standards require us to comply with the Auditing 
Practices Board’s (“APB’s”) Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements 
is provided on the Financial Reporting Council’s website at 
www.frc.org.uk/apb/scope/private.cfm.
Opinion on financial statements
In our opinion the consolidated financial statements:
− − give a true and fair view of the state of the Group’s affairs 
as at 31 March 2014 and of its profit for the year then ended; 
− − have been properly prepared in accordance with IFRS as 
adopted by the European Union; and
− − have been prepared in accordance with the requirements 
of the Companies Act 2006.
Opinion on other matter prescribed by the Companies 
Act 2006
In our opinion the information given in the Strategic Report 
and the Directors’ report for the financial year for which the 
consolidated financial statements are prepared is consistent 
with the consolidated financial statements.
Matters on which we are required to report by 
exception
We have nothing to report in respect of the following:
Under the Companies Act 2006 we are required to report to 
you if, in our opinion:
− − certain disclosures of Directors’ remuneration specified by 
law are not made; or
− − we have not received all the information and explanations 
we require for our audit.
Other matter
We have reported separately on the Parent Company 
financial statements of Lombard Risk Management plc for 
the year ended 31 March 2014.
Christopher Smith
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
12 May 2014
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25 25
Chairman’s statement Governance Financial statements Overview Strategic report
Note
Year ended
31 March 
2014
£000
Year ended 
31 March 
2013
£000
Continuing operations
Revenue 2 20,395 16,768
Cost of sales (164) (201)
Gross profit 20,231 16,567
Administrative expenses (15,770) (12,585)
Profit from operations 4 4,461 3,982
Finance expense 5 (44) (86)
Finance income 6 2 —
Profit before taxation 4,419 3,896
Tax credit / (charge) 7 735 (182)
Profit for the year from continuing operations 5,154 3,714
Profit for the year from continuing operations attributable to:
Owners of the Parent 5,199 3,751
Non-controlling interest (45) (37)
5,154 3,714
Exchange differences on translating foreign operations:
Owners of the Parent (185) 28
Non-controlling interest — —
Total comprehensive income for the year 4,969 3,742
Total comprehensive income attributable to:
Owners of the Parent 5,014 3,779
Non-controlling interest (45) (37)
4,969 3,742
Profit per share
Basic (pence) 8 2.07 1.70
Diluted (pence) 8 2.04 1.66
The accompanying accounting policies and notes form an integral part of the financial statements.
Consolidated statement of comprehensive income 
For the year ended 31 March 2014
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26
Financial statements
Consolidated balance sheet
As at 31 March 2014
Company number: 03224870 Note
As at
31 March 
2014
£000
As at 
31 March 
2013
£000
Non-current assets
Property, plant and equipment 11 206 221
Goodwill 12 5,751 5,848
Other intangible assets 12 11,044 6,868
Deferred tax asset 7 997 503
17,998 13,440
Current assets
Trade and other receivables 13 5,767 3,384
Cash and cash equivalents 2,929 1,874
8,696 5,258
Total assets 26,694 18,698
Current liabilities
Borrowings 14 (667) (1,013)
Trade and other payables 15 (2,695) (2,223)
Deferred income (5,171) (4,276)
(8,533) (7,512)
Long-term liabilities
Borrowings 14 — (667)
Total liabilities (8,533) (8,179)
Net assets 18,161 10,519
Equity
Share capital 17 1,747 1,592
Share premium account 9,375 6,622
Foreign exchange reserves (281) (96)
Other reserves 1,537 1,687
Profit and loss account 5,865 751
Equity attributable to owners of the Parent 18,243 10,556
Non-controlling interest (82) (37)
Total equity 18,161 10,519
The financial statements were approved by the Board on 12 May 2014 and signed on its behalf by:
John Wisbey
Chief Executive Officer
The accompanying accounting policies and notes form an integral part of the financial statements.
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27 27
Chairman’s statement Governance Financial statements Overview Strategic report
Consolidated statement of changes in shareholders’ equity
For the year ended 31 March 2014
Share
capital
£000
Share
 premium
account
£000
Foreign 
exchange
reserves
£000
Other
reserves
£000
Profit 
and loss 
account
£000
Total
attributable 
to the
 owners 
of the 
Company 
£000
Non-
controlling 
interest
£000
Total
equity
£000
Balance at 1 April 2013 1,592 6,622 (96) 1,687 751 10,556 (37) 10,519
Issue of share capital 155 2,846 — — — 3,001 — 3,001
Share issue costs — (93) — — — (93) — (93)
Share-based payment charge — — — 67 — 67 — 67
Share options lapsed or exercised — — — (87) 87 — — —
Share options 
modification expense (130) — (130) — (130)
Dividends — — — — (172) (172) — (172)
Transactions with owners 155 2,753 — (150) (85) 2,673 — 2,673
Profit for the year — — — — 5,199 5,199 (45) 5,154
Other comprehensive income
Exchange differences on 
translating foreign operations — — (185) — — (185) — (185)
Total comprehensive income 
for the year — — (185) — 5,199 5,014 (45) 4,969
Balance at 31 March 2014 1,747 9,375 (281) 1,537 5,865 18,243 (82) 18,161
Share
capital
£000
Share
 premium
account
£000
Foreign 
exchange
reserves
£000
Other
reserves
£000
Profit 
and loss 
account
£000
Total
attributable 
to the
 owners 
of the 
Company 
£000
Non-
controlling 
interest
£000
Total
equity
£000
Balance at 1 April 2012 1,484 5,221 (124) 1,685 (2,861) 5,405 — 5,405
Issue of share capital 108 1,470 — — — 1,578 — 1,578
Share issue costs — (69) — — — (69) — (69)
Share-based payment charge — — — 2 — 2 — 2
Dividends — — — — (139) (139) — (139)
Transactions with owners 108 1,401 — 2 (139) 1,372 — 1,372
Profit for the year — — — — 3,751 3,751 (37) 3,714
Other comprehensive income
Exchange differences on 
translating foreign operations — — 28 — — 28 — 28
Total comprehensive income 
for the year — — 28 — 3,751 3,779 (37) 3,742
Balance at 31 March 2013 1,592 6,622 (96) 1,687 751 10,556 (37) 10,519
Other reserves relate to negative goodwill arising on the acquisition of a subsidiary undertaking prior to 1 April 1997, 
share-based payment and the merger reserve.
The accompanying accounting policies and notes form an integral part of the financial statements.
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28
Financial statements
Year ended
31 March 
2014
£000
Year ended 
31 March 
2013
£000
Cash flows from operating activities
Profit for the period 5,154 3,714
Tax (credit) / charge (735) 182
Finance income (2) —
Finance expense 44 86
Operating profit 4,461 3,982
Adjustments for:
Depreciation 284 140
Amortisation and impairment 1,226 1,142
Share-based payment charge 67 2
(Increase) / decrease in trade and other receivables (2,383) 825
Increase / (decrease) in trade and other payables 574 (114)
Increase / (decrease) in deferred income 895 (173)
Foreign exchange gains (17) (49)
Other non-cash credit — (51)
Cash generated in operations 5,107 5,704
Tax credit received 125 53
Net cash inflow from operating activities 5,232 5,757
Cash flows from investing activities
Interest received 2 —
Purchase of property, plant and equipment and computer software (395) (209)
Purchase of business (see note 10) — (470)
Capitalisation of development costs (5,333) (4,278)
Net cash used in investing activities (5,726) (4,957)
Cash flows from financing activities
Interest paid (44) (86)
Loans from bank — 329
Loans and other consideration paid (1,013) (667)
Shares issued, net of issue costs 2,908 1,509
Share option consideration (130) —
Dividend paid (172) (139)
Net cash generated by financing activities 1,549 946
Net increase in cash and cash equivalents 1,055 1,746
Cash and cash equivalents at beginning of period 1,874 128
Cash and cash equivalents at end of period 2,929 1,874
The accompanying accounting policies and notes form an integral part of the financial statements.
Consolidated cash flow statement
For the year ended 31 March 2014
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Chairman’s statement Governance Financial statements Overview Strategic report
Notes to the consolidated financial statements 
For the year ended 31 March 2014
1. Accounting policies
(A) Basis of preparation
These consolidated financial statements are for the year ended 31 March 2014. They have been prepared in accordance 
with International Financial Reporting Standards (“IFRS”) and IFRS Interpretation Committee (“IFRIC”) interpretations as at 
31 March 2014, as adopted by the European Union. They have been prepared under the historical cost convention.
The preparation of financial statements under IFRS requires the Board to make judgements, estimates and assumptions that 
affect the application of accounting policies, the reported amounts of balance sheet items at the period end and the 
reported amount of revenue and expense during the reporting period. The estimates and associated assumptions are based 
on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of 
which form the basis of making judgements that are not readily apparent from other sources. However, the actual results 
may differ from these estimates. The estimates and underlying assumptions are reviewed on an on-going basis.
New standards, amendments and interpretations
At the date of authorisation of these financial statements, certain new standards, amendments and interpretations to 
existing standards have been published but are not yet effective and have not been adopted early by the Group.
Management anticipates that all of the pronouncements will be adopted by the Group’s accounting policies for the first period 
beginning after the effective date of the pronouncement. Information on new standards, amendments and interpretations 
that are expected to be relevant to the Group’s financial statements is provided below. Certain other new standards and 
interpretations have been issued but are not expected to have a material impact on the Group’s financial statements.
− − IFRS 9 “Financial instruments” (effective 1 January 2015)  
IFRS 9 addresses the classification and measurement of financial assets and will replace IAS 39. The standard is mandatory 
for accounting periods commencing on or after 1 January 2015, subject to adoption by the European Union.
(B) Basis of consolidation
The Group accounts consolidate the financial statements of the Parent Company (Lombard Risk Management plc) and its 
subsidiary undertakings over which it has control (see note 5 to the Parent Company balance sheet). A description of the 
principal activities and operations of the Group can be found in the Directors’ report.
The consolidated financial statements include the financial statements of the Company and its subsidiary undertakings made 
up to 31 March 2014. The acquisition method of accounting has been adopted. Under this method, the results of subsidiary 
undertakings acquired or disposed of in the year are included in the consolidated statement of comprehensive income from 
the date of acquisition or up to the date of disposal. All of the Group’s assets and liabilities existing at the date of acquisition 
are recorded at their fair values reflecting their condition at that date. Profits or losses on intra-Group transactions are 
eliminated in full. Goodwill is capitalised and under IFRS 3 goodwill is not amortised but an impairment test is performed as 
appropriate, at least annually. The value of goodwill is to be written down according to the outcome of the impairment test.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss and net assets that 
is not held by the Group. The Group attributes total comprehensive income or loss of subsidiaries between the owners of the 
Parent and the non-controlling interest based on their respective ownership interest.
(C) Segment reporting 
In identifying its operating segments, management generally follows the Group’s product lines. The Group operates two main 
operating segments: Regulatory Compliance software and Risk Management and Trading software. Regulatory Compliance 
software is for regulatory, anti-money laundering and compliance systems to financial markets. Risk Management and 
Trading software provides trading, valuation and risk management systems to the financial markets. Each of these product 
lines is managed separately as they each require different technology and other resources as well as marketing approaches. 
Corporate overheads, assets and liabilities which are not directly attributable to either product line are not allocated to segments.
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30
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
1. Accounting policies continued
(D) Going concern
The financial statements have, as in previous years, been prepared on a going concern basis. 
In forming an opinion that the Company and the Group is a going concern, the Directors have taken particular note of the 
trading performance in the year ended 31 March 2014, both in the signing of new business contracts and in the realised 
financial results. These show an improvement in profitability and an increase in the cash balance at 31 March 2014. The 
Directors have prepared a cash flow forecast for the period to 30 June 2015, which shows that the Company and Group 
have sufficient facilities for on-going operations. Whilst there will always remain some inherent uncertainty within the 
aforementioned forecasts, the Directors believe the Company and Group have sufficient resources to continue in operational 
existence for at least twelve months from the date of approval of these financial statements.
Accordingly the Directors continue to adopt the going concern basis in preparing the financial statements for the year ended 
31 March 2014.
(E) Revenue
Revenue represents the fair value of goods sold and services provided during the year, stated net of value added tax. 
Revenue and profit before tax are wholly attributable to the principal activities of the Group.
The recognition of revenue depends on the type of income:
Licence income  For long-term projects which do not include the up-front delivery of immediately usable 
software, revenue is recognised on both the consultancy and initial licence elements in line with 
the estimated percentage of completion of the project. This estimation is based upon the views 
of the consultants implementing the projects as to the proportion of the project completed and 
this is supported by data from a time recording system. Annual licence/usage fees and 
maintenance revenue invoiced simultaneously with the initial licence, but considered to relate to 
the period when the licence is deemed to be live, is deferred in its entirety until the live date, 
following which it is released to profit in equal daily instalments over the duration of the relevant 
licence or maintenance. For other projects which do include the up-front delivery of immediately 
usable software, revenue is recognised on a percentage completion basis. For non-refundable 
licences, revenue is recognised in full on customer acceptance as there are no on-going 
obligations in respect of such sales.
Customisation income  Recognised once the customisation has taken place.
Maintenance income  Recognised evenly over the term of the maintenance contract.
Rental income   Recognised evenly over the term of the rental contract.
Data subscription income  Recognised evenly over the term of the data contract.
Training income Recognised when the relevant courses are run.
Multiple element transactions are allocated to relevant revenue categories based on typical revenue splits for transactions 
which are contracted separately and by using industry best practice.
(F) Property, plant and equipment
Property, plant and equipment are stated at cost, net of depreciation and any provision for impairment. No depreciation 
is charged during the period of construction. Leasehold property is included in property, plant and equipment only where 
it is held under a finance lease.
The cost of computer hardware, fixtures, fittings and equipment is written down to the residual value and is depreciated 
in equal annual instalments over the estimated useful lives of the assets. The residual values of assets or groups of like assets 
and their useful lives are reviewed annually.
The estimated useful lives of the assets are as follows: 
Computer hardware two years
Fixtures, fittings and equipment four years
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Chairman’s statement Governance Financial statements Overview Strategic report
1. Accounting policies continued
(G) Goodwill
Goodwill, representing the excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net 
assets acquired, is capitalised and reviewed annually for impairment. Goodwill is carried at cost less accumulated impairment 
losses. Negative goodwill is recognised immediately after acquisition in the consolidated statement of comprehensive income.
(H) Intangible assets
Research and development
Expenditure on research is recognised as an expense in the period in which it is incurred.
Development costs incurred are capitalised when all of the following conditions are satisfied:
− − completion of the intangible asset is technically feasible so that it will be available for use or sale;
− − the Group intends to complete the intangible asset and use or sell it;
− − the Group has the ability to use or sell the intangible asset;
− − the intangible asset will generate probable future economic benefits. Among other things, this requires that there is a 
market for the output from the intangible asset or for the intangible asset itself, or, if it is to be used internally, the asset 
will be used in generating such benefits;
− − there are adequate technical, financial and other resources to complete the development and to use or sell the intangible 
asset; and
− − the expenditure attributable to the intangible asset during its development can be measured reliably.
Development costs not meeting the criteria for capitalisation are expensed as incurred. Capitalised development costs 
are amortised in equal annual instalments over a period of five years from when the separately identifiable intangible asset 
is available for use in the manner intended by management. Enhancements to a separately identifiable intangible asset 
that is already available for use in the manner originally intended by management are expensed as incurred.
Computer software
The cost of computer software, net of estimated residual value and impairment, is depreciated in equal annual instalments 
over one to three years based on the estimated useful lives of the assets. The residual values of assets or group of like assets 
are reviewed annually.
Customer relationships
The cost of customer relationships, net of estimated residual value and impairment, is amortised in equal annual instalments 
over nineteen years based on the estimated useful lives of the assets. The residual values of assets or group of like assets are 
reviewed annually.
Trademarks
The cost of trademarks, net of estimated residual value and impairment, is amortised in equal annual instalments over seven years 
based on the estimated useful lives of the assets. The residual values of assets or groups of like assets are reviewed annually.
(I) Financial instruments
Financial assets and liabilities are recognised on the Group’s balance sheet when the Group becomes a party to the 
contractual provisions of the instrument. The Group’s financial instruments comprise cash, trade receivables, borrowings and 
trade and other payables. Derivative instruments are not used by the Group and the Group does not enter into speculative 
derivative contracts.
Loans and receivables
Loans and receivables are initially stated at their fair value plus transaction costs, then subsequently at amortised cost using 
the effective interest method, if applicable, less impairment losses. Provisions against trade receivables are made when there 
is objective evidence that the Group will not be able to collect all amounts due to it in accordance with the original terms of 
those receivables. The amount of the write down is determined as the difference between the assets’ carrying amount and 
the present value of the estimated future cash flows.
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32
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
1. Accounting policies continued
(I) Financial instruments continued
Cash and cash equivalents
The Group manages short-term liquidity through the holding of cash and highly liquid interest-bearing deposits. Only 
deposits that are readily convertible into cash, with no penalty of lost interest, are shown as cash or cash equivalents.
Trade payables
Financial liabilities are obligations to pay cash or other financial assets and are recognised when the Group becomes a party 
to the contractual provisions of the instrument. All financial liabilities are recorded at amortised cost using the effective 
interest method, with interest related charges recognised as an expense in finance cost in the statement of comprehensive income.
A financial liability is derecognised only when the obligation is extinguished, that is, when the obligation is discharged, 
cancelled or expires. Where debt has been converted into equity, the liability is extinguished at no gain no loss. The equity 
is measured at the carrying value of the extinguished debt.
(J) Foreign exchange
Transactions in foreign currencies are translated into the functional currency of the individual entity at the exchange rate 
ruling at the date of the transaction. Monetary assets and liabilities in foreign currencies are translated at the rates of 
exchange ruling at the balance sheet date. Non-monetary items that are measured at historical cost in a foreign currency 
are translated at the exchange rate at the date of the transaction. 
Any exchange differences arising on the settlement of monetary items or on translating monetary items at rates different 
from those at which they were initially recorded are recognised in the profit or loss in the period in which they arise. The 
assets and liabilities in the financial statements of foreign subsidiaries are translated into the Parent Company’s presentation 
currency at the rate of exchange ruling at the balance sheet date. Income and expenses are translated at the actual rate at 
the date of transaction. The exchange differences arising from the retranslation of the opening net investment in subsidiaries 
are recognised in other comprehensive income and taken to the “Foreign exchange reserve” in equity. On disposal of a 
foreign operation the cumulative translation differences (including, if applicable, gains and losses on related hedges) are 
transferred to profit or loss as part of the gain or loss on disposal.
(K) Taxation
Current tax is the tax currently payable based on taxable profit for the year. Current tax credits arise from the UK legislation 
regarding the treatment of certain qualifying research and development costs, allowing for the surrender of tax losses 
attributable to such costs in return for a tax rebate.
Deferred taxes are calculated using the liability method on temporary differences. Deferred tax is generally provided on the 
difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided 
on the initial recognition of goodwill, nor on the initial recognition of an asset or liability unless the related transaction is a 
business combination or affects tax or accounting profit. Deferred tax on temporary differences associated with shares in 
subsidiaries and joint ventures is not provided if reversal of these temporary differences can be controlled by the Group and it 
is probable that reversal will not occur in the foreseeable future. In addition, tax losses available to be carried forward as well 
as other income tax credits to the Group are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is 
probable that the underlying deductible temporary differences will be able to be offset against future taxable income. 
Current and deferred tax assets and liabilities are calculated at tax rates that are expected to apply to their respective period 
of realisation, provided they are enacted or substantively enacted at the balance sheet date.
Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the statement of comprehensive 
income, except where they relate to items that are charged or credited directly to other comprehensive income or equity in 
which case the related deferred tax is also charged or credited directly to other comprehensive income or equity.
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Chairman’s statement Governance Financial statements Overview Strategic report
1. Accounting policies continued
(L) Leased assets
The Group does not hold any finance leases.
All leases referred to are regarded as operating leases and the payments made under them are charged to the statement of 
comprehensive income on a straight line basis over the lease term. Lease incentives are spread over the term of the lease.
(M) Pension costs
The Group operates a number of defined contribution pension schemes. The assets of the schemes are held separately from 
those of the Group in independently administered funds. The amount charged to profit or loss represents the contributions 
payable to the schemes in respect of the accounting period.
(N) Share options issued to employees
All share-based payment arrangements granted after 7 November 2002 that had not vested prior to 1 April 2006 are 
recognised in the financial statements.
All goods and services received in exchange for the grant of any share-based payment are measured at their fair values. 
Where employees are rewarded using share-based payments, the fair values of employees’ services are determined indirectly 
by reference to the fair value of the instrument granted to the employee. This fair value is appraised at the grant date using a 
binomial model, taking into account the terms and conditions upon which the options were granted.
All equity-settled share-based payments are ultimately recognised as an expense in the statement of comprehensive income 
with a corresponding credit to “other reserves”.
If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based on 
the best available estimate of the number of share options expected to vest. Estimates are subsequently revised if there is any 
indication that the number of share options expected to vest differs from previous estimates. Any cumulative adjustment 
prior to vesting is recognised in the current period. No adjustment is made to any expense recognised in prior periods if share 
options ultimately exercised are different to that estimated on vesting.
Upon exercise of share options the proceeds received net of attributable transaction costs are credited to share capital and, 
where appropriate, share premium.
(O) Impairment testing of goodwill, other intangible assets and property, plant and equipment
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable 
cash flows (cash-generating units). As a result, some assets are tested individually for impairment and some are tested at 
cash-generating unit level. Goodwill is allocated to those cash-generating units that are expected to benefit from synergies 
of the related business combination and represent the lowest level within the Group at which management monitors the 
related cash flows.
Goodwill, other individual assets or cash-generating units that include goodwill, other intangible assets with an indefinite 
useful life and those intangible assets not yet available for use are tested for impairment at least annually. All other individual 
assets or cash-generating units are tested for impairment whenever events or changes in circumstances indicate that the 
carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s or cash-generating unit’s carrying amount exceeds its 
recoverable amount. The recoverable amount is the higher of fair value, reflecting market conditions less costs to sell, and 
value in use based on an internal discounted cash flow evaluation. Impairment losses recognised for cash-generating units, to 
which goodwill has been allocated, are credited initially to the carrying amount of goodwill. Any remaining impairment loss 
is charged pro rata to the other assets in the cash-generating unit. With the exception of goodwill, all assets are 
subsequently reassessed for indications that an impairment loss previously recognised may no longer exist.
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34
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
1. Accounting policies continued
(P) Key judgements in applying the entity’s accounting policies and goodwill impairment
The Group’s management makes estimates and assumptions regarding the future. Estimates and judgements are continually 
evaluated based on historical experience and other factors, including expectations of future events that are believed to be 
reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The 
estimates and assumptions that have a reasonable risk of causing material adjustment to the carrying amounts of assets and 
liabilities within the next financial year are discussed below.
Recognition of revenue
Revenue is recognised according to the accounting policies as stated and is dependent upon the type of income. Where 
contracts include different elements of revenue, those elements are recognised in line with those policies, with fair values 
attributed to each component part.
Judgement is used in the recognition of revenue from long-term projects. 
If work is contracted on a fixed-cost basis, revenue is recognised in line with an estimation of the percentage of completion 
of the project. This estimation is based upon the views of the consultants implementing the projects as to the proportion of 
the project completed and this is supported by data from a time recording system. There is, however, an element of judgement 
involved that can impact the recognition of revenue. This process and individual project recognition is reviewed regularly to 
ensure that, whilst still subjective, the reflection of revenue is the best approximation possible.
Where projects include the up-front delivery of immediately usable software, the element of non-refundable licence revenue 
is recognised on receipt of the software by the customer, with other revenue being recognised in line with the performance 
of the contracted services. The unbundling of this contract revenue requires management to exercise judgement as to the 
relative fair values of the component parts of the contract.
Goodwill impairment
An impairment loss is recognised if the amount by which the asset’s or cash-generating unit’s carrying amount exceeds its 
recoverable amount. To determine the recoverable amount, management estimates expected future cash flows from each 
cash-generating unit and determines a suitable discount rate in order to calculate the present value of those cash flows. In 
the process of measuring expected future cash flows, management makes assumptions about future operating results. These 
assumptions relate to future events and circumstances. The actual results may vary and may cause significant adjustments to 
the Group’s assets within the next financial year.
In most cases, determining the applicable discount rate involves estimating the appropriate adjustment to market risk and the 
appropriate adjustment to asset-specific risk factors.
Capitalisation of development costs
Development costs are capitalised when all of the criteria (see accounting policy note above) have been met. Employees’ time 
is recorded by product and activity and valued by reference to salaries and directly attributable overheads. Values by product 
are reviewed with reference to future profitability.
Some judgement is used to determine which activities constitute development that should be capitalised. Likewise, some 
judgement is required in assessing when a product has reached its intended use and hence when capitalisation of associated 
costs should cease. In addition, judgement is used to determine future profitability of the products and timing thereof.
Deferred tax assets
The assessment of the probability of future taxable income on which deferred tax assets can be utilised is based on the 
Group’s latest approved budget forecasts, which is adjusted for significant non-taxable income and expense. If a positive 
forecast of taxable income indicates the probable use of a deferred tax asset, especially when it can be utilised without a 
time limit, that deferred tax asset is usually recognised in respect of the period for which future profits can be confidently 
foreseen. The recognition of deferred tax assets that are subject to certain legal or economic limit or uncertainties is assessed 
individually by management based on the specific facts and circumstances.
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35 35
Chairman’s statement Governance Financial statements Overview Strategic report
2. Business segmentation
Management currently identifies the Group’s two product lines as operating segments as further described in the accounting 
policies. These operating segments are monitored and strategic decisions are made on the basis of segment operating results.
Segment information can be analysed as follows for the reporting periods under review:
Year ended 
31 March 
2014
£000
Year ended
31 March
2013
£000
Revenue
Regulatory Compliance software 9,574 7,834
Risk Management and Trading software 10,821 8,934
Group unallocated — —
Total revenue 20,395 16,768
Depreciation, amortisation and impairment
Regulatory Compliance software (545) (599)
Risk Management and Trading software (965) (683)
Group unallocated — —
Total depreciation, amortisation and impairment (1,510) (1,282)
Net interest expense
Regulatory Compliance software — —
Risk Management and Trading software — —
Group unallocated (42) (86)
Total interest expense (42) (86)
Other costs
Regulatory Compliance software (7,287) (5,306)
Risk Management and Trading software (7,137) (5,940)
Group unallocated — (258)
Total other costs (14,424) (11,504)
Total costs (15,976) (12,872)
Profit
Regulatory Compliance software 1,742 1,929
Risk Management and Trading software 2,719 2,311
Group unallocated (42) (344)
Total profit before taxation and dividend 4,419 3,896
Net assets
Regulatory Compliance software 3,034 1,292
Risk Management and Trading software 11,093 8,374
Group unallocated 4,034 853
Net assets 18,161 10,519
The two segments operate independently and inter-segment income or expenditure is cross charged at arm’s length. 
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36
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
2. Business segmentation continued
The Group’s revenues from clients and its non-current assets are divided into the following geographical areas: 
Year ended 
31 March 
2014
£000
Year ended
31 March
2013
£000
Revenue
United Kingdom 12,009 6,541
Rest of Europe, Middle East and Africa 2,692 4,777
The Americas 4,137 4,155
Asia Pacific 1,557 1,295
Total revenue 20,395 16,768
Non-current assets
United Kingdom 10,726 6,439
The Americas 468 576
Asia Pacific 56 74
Non-current assets 11,250 7,089
In the year ended 31 March 2014 11% (2013: 10%) of the revenue depended on a single customer.
3. Directors and employees
Directors
2014
£000
2013
£000
Emoluments 1,236 522
Social security costs 120 78
Pension costs 74 73
1,430 673
During the year, three Directors have exercised their share options. During the year one Director accrued benefits under a 
Company pension scheme (2013: two).
The Directors of the Company are the key management personnel.
Individual Directors’ emoluments and compensation
2014
£000
2013
£000
John Wisbey 266 216
Paul Tuson 347 159
Nick Davies 561 154
Philip Crawford 45 45
Brian Crowe 59 21
John McCormick 13 —
Steve Rogers 19 —
Total 1,310 595
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Chairman’s statement Governance Financial statements Overview Strategic report
3. Directors and employees continued
Individual Directors’ emoluments and compensation continued
Share options At start of year Price paid Exercise price At end of year
Date from 
which exercisable Expiry dates
Brian Crowe 800,000 5.5p 5.5p — 14/01/2013 14/01/2016
Paul Tuson 2,400,000 5.5p 5.5p — 14/01/2013 14/01/2016
Nick Davies 1,000,000 6.0p 6.0p — 20/06/2010 20/06/2013
Nick Davies 3,600,000 4.5p 4.5p — 28/05/2012 28/05/2015
Nick Davies — — 11.0p 2,000,000 27/08/2013 27/05/2017
Philip Crawford 2,400,000 — 4.5p 2,400,000 28/05/2012 28/05/2015
Philip Crawford 600,000 — 5.5p 600,000 14/01/2013 14/01/2016
John McCormick — — 13.0p 1,000,000 01/11/2015 01/11/2018
Steve Rogers — — 13.0p 1,000,000 15/08/2015 15/08/2018
2,000,000 share options granted to Nick Davies were modified during the year under review; further details are given in note 18.
Staff costs including Directors
2014
£000
2013
£000
Wages and salaries 11,893 10,080
Social security costs 2,228 1,906
Pension costs 134 172
Share-based payments charge (note 18) 67 2
Total staff costs 14,322 12,160
Capitalised costs (4,109) (3,704)
Total staff costs included in consolidated statement of comprehensive income 10,213 8,456
The average monthly number of employees (excluding Directors) during the year was:
2014
Number
2013
Number
Office and administration 18 17
Operational 251 244
Total 269 261
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38
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
4. Profit from operations
The profit from operations before taxation is stated after charging / (crediting):
2014
£000
2013
£000
Auditor’s remuneration – Company audit fee 25 25
Fees payable to the Company auditor for other services:
– subsidiary company audit fees 24 15
– tax services 18 12
– other services 7 5
Depreciation 185 140
Amortisation and impairment 1,325 1,142
Foreign exchange loss / (gain) 41 (92)
Operating leases – land and buildings 1,333 1,289
Research and development expenditure 1,796 1,869
Fees payable to the Company’s auditor, Grant Thornton UK LLP, and its associates for non-audit services to the Company 
itself are not disclosed in the individual financial statements of the Company because the Company’s Group financial 
statements are required by the Companies (Disclosure of Auditor Remuneration and Liability Limitation Agreements) 
Regulations 2008, Regulation 5(1) to disclose such fees on a consolidated basis.
5. Finance expense
2014
£000
2013
£000
Interest on bank loans and overdrafts 44 86
6. Finance income
2014
£000
2013
£000
Interest on bank deposits 2 —
7. Taxation
(A) Analysis of charge in the period
2014
£000
2013
£000
Current tax:
– UK corporation tax on profits in the period (222) —
– foreign tax on profits in the period (5) (53)
Total current tax credit (227) (53)
Deferred tax:
– origination and reversal of timing differences (508) 235
Total deferred tax (credit) / charge (508) 235
Taxation (credit) / charge on ordinary activities (735) 182
(B) Research and development tax credits
The Group has received to date research and development tax credits of £1,038,000 (2013: £816,000) relating to financial 
years ended 31 March 2002 to 2010. As for all companies that have received these credits, the amounts are subject to 
potential future HM Revenue & Customs claw back.
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Chairman’s statement Governance Financial statements Overview Strategic report
7. Taxation continued
(C) Tax on profit on ordinary activities
The tax assessed for the period is the standard rate of corporation tax in the UK of 23% (2013: 24%). The difference is 
explained as follows:
2014
£000
2013
£000
Profit on ordinary activities before tax 4,419 3,896
Profit on ordinary activities multiplied by the standard rate of corporation tax in the UK of 23% 
(2013: 24%) 1,016 935
Effect of:
– net utilisation of tax losses (1,766) (718)
– expenses not deductible for tax purposes 20 18
– foreign tax credits (5) (53)
Current tax (credit) / charge for the period (735) 182
(D) Unrecognised deferred tax
A deferred tax asset of £2.0m (2013: £0.7m) is unrecognised and relates principally to trading losses carried forward.
(E) Deferred tax asset
The deferred tax asset included in the balance sheet relates principally to the carry forward of tax losses.
2014
£000
2013
£000
Deferred tax asset 997 503
The Directors have recognised a deferred tax asset in respect of carried forward trading tax losses as, based on current estimates, 
the Group is forecast to make sufficient trading tax profit in the future against which these losses can be offset. The recognised 
deferred tax asset is based on expected profits in the next financial year. The movement in the deferred tax asset in the year 
is recognised in full in the profit for the year; no amount is recognised directly in equity.
The deferred tax asset is expected to crystallise in full in the next financial year.
8. Profit per share
Basic profit per share has been calculated by dividing the profit after taxation by the weighted average number of Ordinary 
Shares in issue during each period.
For diluted earnings per share, the weighted average number of shares, 251,717,005 (2013: 227,991,541), is adjusted 
to assume conversion of all dilutive potential Ordinary Shares under the Group’s share option plans, being 3,051,314 
(2013: 6,755,180), to give the diluted weighted number of shares of 253,341,143 (2013: 234,746,721). 
Profit per share
Year ended
31 March 
2014
Year ended
31 March 
2013
Profit for the year and basic and diluted earnings attributable to Ordinary Shareholders £5.199m £3.896m
Weighted average number of Ordinary Shares 251,717,005 227,991,541
Profit per share (pence) 2.07 1.70
Adjusted weighted average number of Ordinary Shares 254,768,319 234,746,721
Diluted profit per share (pence) 2.04 1.66
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40
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
9. Non-controlling interest
Non-controlling interest relates to 20% of Lombard Risk Compliance Policies Limited that is owned by a third party. 
10. December 2011 acquisition
On 15 December 2011, the Group acquired the assets of the regulatory business of SOFGEN, including clients, REG-Reporter
®
 
software and trademarks, together with the on-going business for a consideration of £2.8m, primarily to expand its regulatory 
compliance business geographically.
The main part of the business acquired, which in the past was known in the US regulatory market as IDOM USA, is the US 
and Canada regulatory reporting product REG-Reporter
®
. REG-Reporter
®
 has a strong client base in North America. 
The purchase price for the SOFGEN business included cash of £1.963m, the issue of Ordinary Shares with a fair value of £305,000 
and the issue of loan notes, of which £174,000 was due to be settled on 31 December 2012 and £347,000 on 31 December 2013. 
The loan note due for settlement on 31 December 2013 was settled during the year ended 31 March 2013 for an adjusted 
amount of £296,000. 
11. Property, plant and equipment
Group
Computer
hardware
£000
Fixtures, 
fittings and 
equipment
£000
Total
£000
Cost
At 1 April 2012 1,286 721 2,007
Additions 138 32 170
Foreign exchange effect 27 18 45
At 31 March 2013 1,451 771 2,222
1 April 2013 1,451 771 2,222
Additions 169 10 179
Foreign exchange effect (44) (28) (72)
At 31 March 2014 1,576 753 2,329
Depreciation
At 1 April 2012 1,162 659 1,821
Charge for the year 116 24 140
Foreign exchange effect 23 17 40
At 31 March 2013 1,301 700 2,001
At 1 April 2013 1,301 700 2,001
Charge for the year 155 30 185
Foreign exchange effect (39) (24) (63)
At 31 March 2014 1,417 706 (2,123)
Net book value
At 31 March 2014 159 47 206
At 31 March 2013 150 71 221
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Chairman’s statement Governance Financial statements Overview Strategic report
12. Intangible assets
Group
Goodwill
£000
Capitalised
development 
costs
£000
Other 
intangible 
assets
£000
Total
£000
Cost
At 1 April 2012 5,799 3,318 977 10,094
Additions — 4,278 39 4,317
Foreign exchange effect 49 — 31 80
At 31 March 2013 5,848 7,596 1,047 14,491
At 1 April 2013 5,848 7,596 1,047 14,491
Additions — 5,333 216 5,549
Foreign exchange effect (97) — (57) (154)
At 31 March 2014 5,751 12,929 1,206 19,886
Amortisation and impairment
At 1 April 2012 — 287 339 626
Provided in the year — 1,028 114 1,142
Foreign exchange effect — — 7 7
At 31 March 2013 — 1,315 460 1,775
At 1 April 2013 — 1,315 460 1,775
Provided in the year — 741 160 901
Impairment charge — 424 — 424
Foreign exchange effect — — (9) (9)
At 31 March 2014 — 2,480 611 3,091
Net book value
At 31 March 2014 5,751 10,449 595 16,795
At 31 March 2013 5,848 6,281 587 12,716
The goodwill at 31 March 2014 relates to the acquisition of STB Systems Limited, since renamed Lombard Risk Compliance 
Limited, which was acquired in 2005 and which constituted the Group’s regulatory compliance business, and to goodwill 
arising in 2011 relating to the acquisition of the regulatory reporting business of SOFGEN, further details of which are 
provided in note 10. Both these businesses now represent the Group’s regulatory compliance business. An impairment 
review has therefore been carried out on this cash-generating unit.
The cash-generating unit has been assessed by comparing its carrying value to its recoverable amount. The recoverable 
amount is the higher of fair value, reflecting market conditions less costs to sell, and value in use based on an internal 
discounted cash flow evaluation.
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42
Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
12. Intangible assets continued
For the year ended 31 March 2014, the cash-generating unit recoverable amount was determined based on value-in-use 
calculations, which are based on detailed five-year discounted forecast cash flows (using a discount rate of 10%). Cash flows 
for the regulatory compliance business are based on management forecasts, which are approved by the Board and reflect 
management’s expectations of sales growth, operating costs and margin based on past experience as well as the current 
order book. Management has used a five-year period in the cash flow projections as the regulatory compliance business 
experiences a low level of customer turnover and the technology is based on regulations which, whilst subject to periodic 
amendment, are unlikely to be withdrawn.
For the years 2015 to 2019 no new business is forecast with retention levels of recurring revenues averaging 90% per 
annum. In view of this, no sales and marketing or research and development costs are forecast for the years 2015 to 2019.
Sensitivity to changes in key assumptions: impairment testing is dependent on management’s estimates and judgements, 
in particular in relation to the forecasting of future cash flows and the discount rate applied to the cash flows. Management 
has concluded that no reasonably possible change in the key assumptions would cause the carrying value of goodwill to 
exceed its recoverable account.
Capitalised development costs reflect the expenditure attributable to the development of new technology that will provide 
economic benefit in future periods as set out in note 1(H). The Group’s development costs relate to the Group’s products, 
including COLLINE
®
, ComplianceASSESSOR, REFORM™, MIS reporting, etc. The COLLINE
®
 suite of products is individually 
significant; the net book value at 31 March 2014 is £3,629,000 (2013: £2,405,000). Amortisation is over a five-year period 
from the time when each separately identifiable intangible asset reaches its intended use by management.
One of the Risk Management products has been identified as impaired following a review of the carrying values of 
capitalised development costs. The net carrying value of this product has therefore been written down to £300,000, 
resulting in an impairment charge of £424,000.
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13. Trade and other receivables
2014
£000
2013
£000
Trade receivables 2,936 2,261
Other receivables 430 525
Prepayments and accrued income 2,401 598
5,767 3,384
The amounts are short term and the Directors consider that the carrying amount of these trade and other receivables approximates 
to their fair value. All of the Group’s trade and other receivables have been reviewed for indications of impairment. As at 
31 March 2014, trade receivables of £2.9m (2013: £2.3m) were fully recoverable. An impairment provision of £0.13m (2013: £0.04m) 
has been made against the invoices of nineteen clients (2013: twelve clients). In addition, some of the unimpaired trade 
receivables are past due as of the reporting date. Trade receivables past due but not impaired are as follows:
2014
£000
2013
£000
Not more than three months 167 593
More than three months but not more than six months 39 45
More than six months but less than one year 139 1
More than one year 1 8
346 647
All other receivables (non-trade) are not past due.
Movements in Group provisions for impairment of trade receivables, as included in administrative expenses, are as follows:
2014
£000
2013
£000
Opening balance 39 239
Movement in provision for receivables 95 (200)
Closing balance 134 39
The Group operates in a global market with income arising in a number of different currencies, principally Sterling, Euros or 
US Dollars. Other than natural opportunities to hedge, the Group does not hedge potential future income, since the existence, 
quantum and timing of such income cannot be accurately predicted.
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Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
14. Borrowings
2014
£000
2013
£000
Bank loans payable within one year 667 1,013
Bank loans payable after one year — 667
667 1,680
Borrowings at 31 March 2014 is a Sterling bank loan. Borrowings at 31 March 2013 comprise a Sterling bank loan and a Euro 
bank loan. 
The Sterling bank loan is repayable in equal quarterly instalments over a three-year term with the first repayment in April 2012. 
The loan principal is £2.0m and interest is payable at the rate of LIBOR + 4%. The balance outstanding at 31 March 2014 is £0.7m 
(2013: £1.3m).
The Euro bank loan was repaid in one payment on 30 April 2013. The loan principal was €0.4m and interest was payable at a 
rate of LIBOR + 4.25%. The balance outstanding at 31 March 2014 was £Nil (2013: £0.3m).
15. Trade and other payables
2014
£000
2013
£000
Trade payables 741 608
Other taxes and social security costs 1,305 843
Accruals and other payables 649 772
2,695 2,223
16. Financial risk management and financial instruments
The Group’s multinational operations expose it to financial risks that include market risk, credit risk, operational risk and 
liquidity risk. The Directors review and agree policies for managing each of these risks and they are summarised below. 
These policies have remained unchanged from previous years.
Market risk
Market risk for the Group encompasses all those market risk factors that impact the value of the Group’s assets and liabilities 
and the expected value in base currency of the Group’s revenues and costs. The main risk factors are currency risk, inflation 
risk and interest rate risk. The Group’s policies for managing these are as follows:
I) Currency risk
The Group is exposed to translational and transactional foreign exchange risk as it operates in various currencies, including 
US Dollars, the Euro, Chinese Yuan, Hong Kong Dollars and Singapore Dollars, which affect the management and levels of 
working capital. 
Mitigation: Although, through its own software, the Group has access to sophisticated models for the management of 
foreign exchange risk, there has historically been no use of foreign exchange derivatives to manage this position on the basis 
that the overall effect on the Group’s income statement has not been large enough to warrant the management, costs and 
margin requirements of this activity. The Group does use natural hedges where the appropriate opportunity arises. In addition, 
the Group prepares working capital forecasts that incorporate sensitivity analysis on exchange rate fluctuations. The Group’s 
main on-going transactional exposure is to be long of Euro and US Dollars and short of Chinese Yuan. 
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16. Financial risk management and financial instruments continued
Market risk continued
II) Inflation risk
The Group has exposure to the inflationary effect in countries in which it operates, offset by its ability to raise prices in those 
countries in which it sells. This exposure could affect the Group’s cost base. The Group’s cost base is mainly exposed to the 
inflation rates and changes in payroll taxes in the UK, the US and China. 
Mitigation: The inflation rate for salaries in specialised parts of the financial sector in a financial centre such as London, New 
York or Shanghai is often different from the relevant country’s overall rate of wage inflation. Salary inflation in these markets 
and internally is monitored. No specific hedging of inflation risk has been carried out. 
III) Interest rate risk
Interest rate risk arises primarily on the investment of the Group’s cash balances or on its borrowings and the present value 
of the Group’s receivables. In particular, interest on the Group’s borrowings is affected by LIBOR. 
Mitigation: The Group finances its operations through retained cash reserves and overdraft facilities. The policy of the Group 
is to monitor exposure to interest rate risk and take into account potential movements in interest rates as well as liquidity 
considerations when selecting methods of financing.
Credit risk
Credit risk is the risk that a third party might fail to fulfil its performance obligations under the terms of a financial instrument. 
For cash and cash equivalents and trade and other receivables, credit risk represents the carrying amount on the balance sheet.
Mitigation: Most of the Group’s business is with banks, asset management firms and other high-quality companies and the 
Group’s bad debt experience over fifteen years has been negligible. The Group consequently has not considered taking out 
credit insurance and is not likely to do so in the foreseeable future. Deposits are placed with high-quality banks. The Group 
closely monitors its credit risk.
There has been no use of credit derivatives to mitigate counterparty risk and no such use is contemplated.
The Group’s exposure to credit risk is limited to the carrying amount of financial assets recognised at the balance sheet date, 
as summarised below: 
Classes of financial assets – carrying amounts
2014
£000
2013
£000
Cash and cash equivalents 2,929 1,874
Trade and other receivables 3,366 2,786
Categorised as loans and receivables 6,295 4,660
Operational risk
The Group has numerous operational risks, ranging from control over bank accounts to its processes for delivering and 
supporting software to a required level of quality and on a timely basis and retention and recruitment of key personnel. 
A key risk, as for any group, is the reputational risk that might arise from poor execution, non-delivery or late delivery 
of a high profile project or breach of client confidentiality for sensitive data. Further risks may arise where late delivery 
of software or untimely delivery of related services causes a client to miss regulatory deadlines. 
Mitigation: The Group’s Audit Committee regularly reviews controls over certain aspects of the operations of the Group. 
In addition, the Audit Committee maintains an operational risk register. Such a detailed operational risk review is outside 
the scope of this report but the Board attaches importance to maintaining appropriate internal controls to identify and limit 
these risks; this includes integrated project management across all functions of the business. 
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Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
16. Financial risk management and financial instruments continued
Liquidity risk
Liquidity risk is the risk of loss from not having access to sufficient funds to meet both expected and unexpected cash demands.
Mitigation: The Group seeks to manage financial risk by ensuring that sufficient liquidity is available to meet foreseeable 
needs and by investing cash assets safely as well as profitably. The Group’s working capital report, produced each month, 
shows forecast monthly movements in working capital and cash for the following year. When required the Group has a 
short-term overdraft facility which at the year end has not been used. At 31 March 2014 the Group’s financial liabilities were 
as follows:
2014
£000
2013
£000
Current liabilities
Trade and other payables 1,390 1,380
Borrowings 667 1,013
Non-current liabilities
Borrowings — 667
Categorised as financial liabilities measured at amortised cost 2,057 3,060
Maturity analysis
At 31 March 2014 the Group’s liabilities have contracted maturities which are summarised below:
2014 2013
Up to 
one year
£000
One to 
five years
£000
Up to 
one year
£000
One to 
five years
£000
Bank borrowings 667 — 1,066 684
Trade and other payables 1,390 — 1,380 —
Total 2,057 — 2,446 684
The above contractual maturities reflect the payment obligations which may differ from the carrying value of the liabilities at 
the balance sheet date.
Interest rate sensitivity
The Group is exposed to changes in market interest rates (LIBOR) through the bank borrowings as set at in note 14.
The following table illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates (LIBOR) of 
+1% or -1%. These changes are considered to be reasonably possible based on observations of current market conditions. 
These calculations are based on a change in the average market interest rate for each period and the financial instruments 
held at each reporting date that are sensitive to changes in interest rates. All other variables are held constant.
Profit for the year Equity
£000 £000 £000 £000
LIBOR +1% -1% +1% -1%
31 March 2014 5,147 5,161 18,154 18,168
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16. Financial risk management and financial instruments continued
Capital management
The Group’s capital management objectives are to ensure the Group’s ability to continue as a going concern and to provide 
an adequate return to shareholders. The Group monitors capital in proportion to risk and makes adjustments in the light of 
changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital 
structure the Group may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt.
The Group had bank borrowings of £0.67m as at the year end. In line with the terms of that debt the Group monitors capital 
on the basis of three covenants in place over the debt, being:
− − total net debt to adjusted EBITDA;
− − EBITDA to net finance charge; and
− − cash flow to debt service.
All covenants were satisfied at 31 March 2014.
17. Share capital
2014
£000
2013
£000
Authorised
714,034,085 Ordinary Shares of 0.5p each (2013: 714,034,085) 3,570 3,570
Allotted, called up and fully paid
263,366,260 Ordinary Shares of 0.5p each (2013: 232,409,897) 1,317 1,162
429,829,575 deferred shares of 0.1p each (2013: 429,829,575) 430 430
1,747 1,592
The deferred shares carry no rights to receive dividends or to participate in any profits of the Company. The shareholders are 
not entitled to attend any meetings of the Company or have any rights to participate in any return of capital (except on a 
winding up). The deferred shares are not transferable other than with the consent of all the Directors of the Company.
Share issue
On 28 May 2013, the Company issued 120,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which has been 
credited to the share premium account.
On 12 June 2013, the Company issued 120,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which has been 
credited to the share premium account.
On 17 July 2013, the Company issued 19,090,909 Ordinary Shares of 0.5p per share in order to accelerate growth, to recruit 
certain key staff and to provide cash for potential acquisition opportunities. The shares were issued at a premium of 10.5p 
per share, which has been credited to the share premium account, net of issue costs of £93,000.
On 17 July 2013, the Company also issued further 4,545,454 Ordinary Shares of 0.5p per share to a then-prospective new 
Director. The shares were issued at premium of 10.5p per share, which has been credited to the share premium account.
On 16 August 2013, the Company issued 1,000,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 5.5p per share, which has 
been credited to the share premium account.
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Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
17. Share capital continued
Share issue continued
On 16 August 2013, the Company issued 1,600,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 4.0p per share, which has 
been credited to the share premium account.
On 22 August 2013, the Company issued 2,400,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which has 
been credited to the share premium account.
On 7 October 2013, the Company issued 800,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which has been 
credited to the share premium account.
On 3 December 2013, the Company issued 80,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme; further details are provided in note 18. The shares were issued at a premium of 8.5p per share, which has been 
credited to the share premium account.
On 5 December 2013, the Company issued 200,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme; further details are provided in note 18. The shares were issued at a premium of 8.5p per share, which has been 
credited to the share premium account.
On 30 January 2014, the Company issued 1,000,000 Ordinary Shares of 0.5p per share as part of the Company’s share 
option scheme; further details are provided in note 18. The shares were issued at a premium of 5.0p per share, which has 
been credited to the share premium account.
18. Share options
Employee share options charge
The fair value is based on a number of assumptions as stated below.
In accordance with the accounting policy stated under note 1(N), the volatility of the Company’s shares for the relevant 
period has been estimated at 30% historically, and for the year under review between 34% to 38% to reflect the current 
market situation, giving a charge to the profit and loss account for the year ended 31 March 2014 of £66,906 (2013: £2,445), 
with the same amount being credited to reserves. The expected volatility has been based on historical volatility, historically 
using market prices of Lombard Risk Management plc shares between 4 September 2004 and 31 March 2010, giving 30%. 
For the year under review, volatility is calculated using past year share price at the date of share option issued, giving a 
volatility between 34% to 38% for various share option issued; for details see below.
Equity-settled share-based payments
The Company has a share option scheme for all employees. Options are granted to employees based on the discretion of the 
Directors to reward performance. The options are settled in equity once exercised. If the options remain unexercised after the 
end of the exercising period, the options expire. Options are forfeited if the employee leaves the Company.
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18. Share options continued
Equity-settled share-based payments continued
The fair values of the options were calculated using a numerical binomial model assuming the inputs shown below:
At start
 of year Granted Modified Exercised
Lapsed/
waived
At end
 of year
Exercise
 price (p)
Exercise
 date from
Exercise
 date to
2004 EMI 
Scheme
1,720,000 — — (280,000) (1,440,000) — 9.00 April 2008 April 2013
300,000 — — — (300,000) — 9.00 December 
2008
December
 2013
1,500,000 — — — — 1,500,000 6.00 October 2011 October 2016
1,000,000 — — (1,000,000) — — 6.00 June 2010 June 2015
1,414,365 — — (1,414,365) — — 4.50 May 2012– 
May 2014
May 2015
4,160,000 — — (3,640,000) — 520,000 5.50 January 2013 January 2016
— 1,000,000 — — — 1,000,000 12.00 April 2015 April 2018
Unapproved 
Scheme
70,000 — — — (70,000) — 9.00 April 2008 April 2013
4,585,635 — (2,000,000) (185,635) — 2,400,000 4.50 May 2012– 
May 2014
May 2015
1,600,000 — — (800,000) — 800,000 5.50 January 2013 January 2016
500,000 — — — — 500,000 12.00 April 2014 April 2017
900,000 — — — — 900,000 12.00 May 2014 May 2017
— — 2,000,000 — — 2,000,000 11.00 August 2013 July 2017
— 1,303,012 — — — 1,303,012 13.00 July 2015 July 2018
— 2,868,676 — — — 2,868,676 13.00 July 2016 July 2018
— 2,150,000 — — (450,000) 1,700,000 13.00 August 2015 August 2018
— 1,350,000 — — (300,000) 1,050,000 13.00 August 2016 August 2018
— 250,000 — — — 250,000 13.00 August 2017 August 2018
— 500,000 — — — 500,000 13.00 November 
2015
November 
2018
— 250,000 — — — 250,000 13.00 November 
2016
November
 2018
— 250,000 — — — 250,000 13.00 November 
2017
November
 2018
— 2,000,000 — — — 2,000,000 14.00 January 2016 January 2019
CSOP 
Scheme
— 3,428,312 — — — 3,428,312 12.00 March 2017 March 2024 
17,750,000 15,350,000 — (7,320,000) (2,560,000) 23,220,000 
2,000,000 share options were modified during the year under review. Details of the inputs into the modified options are 
set out in the table below. The cost of the modification has been calculated as the difference between the fair value of the 
original share option price and the fair value of the re-priced options, both measured at the modification date. The cost of 
the modification is £130,000 and this amount has been debited directly to the other reserves within equity. 
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Financial statements
Notes to the consolidated financial statements continued
For the year ended 31 March 2014
18. Share options continued
Equity-settled share-based payments continued
Details of share options granted during the year are as follows:
Grant date
 April
2013
July 
2013
July 
2013
August
2013
August 
2014
November
 2014
January 
2014
March
2014
March
2014
Share price at grant 8.3p 10.8p 11.5p 12.1p 12.3p 12.5p 13.3p 10.4p 10.4p
Exercise price 12.0p 13.0p 13.0p 13.0p 13.0p 13.0p 14.0p 12.0p 12.0p
Contractual life (years) 3 3 3 3 3 3 3 3 7
Staff turnover 50% 50% 50% 50% 50% 50% 50% 50% 50%
Risk-free rate Discount curve used for UK on the day of valuation
Expected volatility 36.1% 38.2% 38.0% 38.0% 38.0% 37.7% 35.3% 34.7% 34.7%
Expected dividend yield — — — — — — — — —
Fair value of option 1.62p 2.93p 3.27p 3.64p 3.77p 3.94p 3.92p 2.72p 4.35p
Details of share options modified during the year are as follows.
Modification date
 August 
2013
Share price at modification 11.22p
Exercise price 11p
Contractual life (years) 4
Value at the date of modification 0.22p
Details of the number of share options and the weighted average exercise price (“WAEP”) outstanding during the year 
are as follows:
2014
Number
2014
WAEP
2013
Number
2013
WAEP
Outstanding at beginning of the year 17,750,000 6.16p 19,170,000 5.54p
Granted during the year 15,350,000 12.63p 1,400,000 12.00p
Exercised during the year (7,320,000) 5.27p (1,600,000) 4.84p
Lapsed during the year (2,560,000) 10.17p (1,220,000) 4.84p
Outstanding at end of the year 23,220,000 10.88p 17,750,000 6.16p
Exercisable at the year end 6,420,000 12,350,000 
The weighted average remaining contractual life of share options outstanding at the year end was 2.3 years (2013: 2.1 years).
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19. Operating leases
The Group had commitments under non-cancellable operating leases in respect of land and buildings. The Group’s future 
minimum operating lease payments are as follows:
2014
£000
2013
£000
Within one year or less 1,007 1,220
Within one to five years 390 933
Total 1,397 2,153
20. Pensions
A Group company contributes to a defined contribution pension scheme on behalf of a limited number of employees of that 
subsidiary. The assets of the scheme are administered by trustees in a fund independent of the Company. Other defined 
contribution pension schemes to which the Group makes contributions on behalf of employees are of the stakeholder 
variety, again totally independent of the Company.
21. Related party transactions
There are no related party transactions in this reporting year or comparative period. 
Key management of the Group are the Directors of the Parent Company. Details of the Directors’ remuneration are set out 
in note 3 and in the Remuneration Committee report.
22. Controlling personnel related parties
In the opinion of the Directors, there was no ultimate controlling party at 31 March 2014.
23. Dividends
During 2014, Lombard Risk Management plc paid a dividend of £171,686 (2013: £139,166) to its equity shareholders. 
This represents a payment of 0.070p per share (2013: 0.060p).
Also during 2014, the Directors proposed a dividend of 0.045p per share (2013: 0.040p) to be paid on 25 July 2014 to those 
shareholders on the register on 11 July 2014. As the distribution of the dividends by Lombard Risk Management plc requires 
the approval at the shareholders’ meeting, no liability in this respect is recognised in the 2014 consolidated financial 
statements. No income tax consequences for Lombard Risk Management are expected to arise as a result of this transaction.
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Financial statements
Independent auditor’s report
Parent Company financial statements
Independent auditor’s report to the members of Lombard Risk Management plc
We have audited the Parent Company financial statements of Lombard Risk Management plc for the year ended 31 March 2014 
which comprise the Parent Company balance sheet and the related notes. The financial reporting framework that has been 
applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally 
Accepted Accounting Practice).
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies 
Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are 
required to state to them in an Auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not 
accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit 
work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and auditor
As explained more fully in the Directors’ responsibilities statement set out on page 19, the Directors are responsible for the 
preparation of the Parent Company financial statements and for being satisfied that they give a true and fair view. Our 
responsibility is to audit and express an opinion on the Parent Company financial statements in accordance with applicable 
law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing 
Practices Board’s (“APBs”) Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the Financial Reporting Council’s website at  
www.frc.org.uk/apb/scope/private.cfm.
Opinion on financial statements
In our opinion the Parent Company financial statements:
− − give a true and fair view of the state of the Company’s affairs as at 31 March 2014;
− − have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
− − have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Directors’ report for the financial year for which the financial statements are 
prepared is consistent with the Parent Company financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, 
in our opinion:
− − adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been 
received from branches not visited by us; or
− − the Parent Company financial statements are not in agreement with the accounting records and returns; or
− − certain disclosures of Directors’ remuneration specified by law are not made; or
− − we have not received all the information and explanations we require for our audit.
Other matter
We have reported separately on the Group financial statements of Lombard Risk Management plc for the year ended 
31 March 2014. 
Christopher Smith
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
12 May 2014
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Company balance sheet
As at 31 March 2014
Company number: 03224870 Note
As at
31 March 
2014
£000
As at
31 March 
2013
£000
Fixed assets
Tangible assets 4 129 109
Intangible assets 4 132 10
Investments in subsidiaries 5 12,611 12,611
12,872 12,730
Current assets
Debtors due within one year 6 7,417 5,957
Cash at bank and in hand 88 90
7,505 6,047
Creditors: amounts falling due within one year 7 (1,042) (1,648)
Net current assets 6,463 4,399
Total assets less current liabilities 19,335 17,129
Creditors: amounts falling due after more than one year 8 — (667)
Net assets 19,335 16,462
Capital and reserves
Called up share capital 10 1,747 1,592
Share premium 11 9,375 6,622
Other reserves 11 7,047 7,197
Profit and loss account 11 1,166 1,051
Shareholders’ funds 19,335 16,462
The financial statements were approved by the Board on 12 May 2014 and signed on its behalf by:
John Wisbey
Chief Executive Officer
The accompanying accounting policies and notes form an integral part of these financial statements.
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54
Financial statements
Notes to the Company financial statements
For the year ended 31 March 2014
1. Accounting policies
(A) Basis of preparation
The separate financial statements of the Company are presented as required by the Companies Act 2006. As permitted by 
that Act, the separate financial statements have been prepared in accordance with all applicable United Kingdom Accounting 
Standards and on a historical cost basis.
(B) Going concern
The financial statements have, as in previous years, been prepared on a going concern basis. 
In forming an opinion that the Company and the Group is a going concern, the Directors have taken particular note of the 
trading performance in the year ended 31 March 2014, both in the signing of new business contracts and in the realised 
financial results. These show an improvement in profitability and an increase in the cash balance at 31 March 2014. The 
Directors have prepared a cash flow forecast for the period to 30 June 2015, which shows that the Company and Group 
have sufficient facilities for on-going operations. Whilst there will always remain some inherent uncertainty within the 
aforementioned forecasts, the Directors believe the Company and Group have sufficient resources to continue in operational 
existence for at least twelve months from the date of approval of these financial statements.
Accordingly the Directors continue to adopt the going concern basis in preparing the financial statements for the year ended 
31 March 2014.
(C) Foreign exchange
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities 
denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date. All differences 
are taken to the profit and loss account.
(D) Deferred taxation
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date 
where transactions or events that result in an obligation to pay more, or a right to pay less, tax in the future have occurred 
at the balance sheet date. Deferred tax assets are recognised when it is more likely than not that they will be recovered. 
Deferred tax is measured using rates of tax that have been enacted or substantively enacted by the balance sheet date.
(E) Leased assets
All leases held by the Company are regarded as operating leases and the payments made under them are charged to the 
profit and loss account on a straight line basis over the lease term.
(F) Fixed and intangible assets
Depreciation is provided using the following rates and bases so as to write off the cost or valuation of fixed and intangible 
assets over their useful lives in the Company’s business:
Computer software 50% to 100% straight line
Computer hardware 50% straight line
Fixtures, fittings and equipment 25% straight line
(G) Investments in subsidiaries
Investments in subsidiaries are recorded at cost less any provision for permanent diminution in value.
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Chairman’s statement Governance Financial statements Overview Strategic report
2. Directors and employees
Staff costs including Directors
2014
£000
2013
£000
Wages and salaries 2,190 1,535
Social security costs 381 252
Pension costs 15 9
Share-based payments charge (note 18 to the consolidated financial statements) 67 2
Total staff costs 2,653 1,798
3. Profit for the financial year
The Parent Company has taken advantage of Section 408 of the Companies Act 2006 and has not included its own income 
statement in these financial statements. The Parent Company’s profit for the year was £200,252 (2013: £145,000).
4. Fixed assets
Company
Computer
hardware
£000
Fixtures, 
fittings and 
equipment
£000
Computer
software
£000
Total
£000
Cost 
At 1 April 2013 960 450 334 1,744
Additions 106 9 214 329
At 31 March 2014 1,066 459 548 2,073
Depreciation 
At 1 April 2013 879 422 324 1,625
Charge for the year 82 13 92 187
At 31 March 2014 961 435 416 1,812
Net book value
At 31 March 2014 105 24 132 261
At 31 March 2013 81 28 10 119
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56
Financial statements
Notes to the Company financial statements continued
For the year ended 31 March 2014
5. Investments in subsidiaries
Investments in subsidiaries
2014
£000
2013
£000
At 1 April and 31 March 12,611 12,611
The Directors have considered the carrying value of the investments in subsidiaries and have concluded, on the basis 
of forecast financial performance of the subsidiaries, that no impairment in value has taken place and therefore that 
no provision is currently required.
At 31 March 2014 the undertakings in which the Company held more than 20% of the allotted share capital were as follows:
Proportion of  
Ordinary Share capital held
By Parent 
(%)
By Group 
(%)
Country of 
incorporation Business
Lombard Risk Systems Limited 100 100 UK Software
Lombard Risk Compliance Limited 100 100 UK Software
Lombard Risk International Limited 100 100 China Software
Lombard Risk Systems Inc. — 100 US Software
Lombard Risk International (USA) Inc. — 100 US Software
Lombard Risk International (Hong Kong) Limited — 100 Hong Kong Software
Lombard Risk International (Singapore) Limited — 100 Singapore Software
Lombard Risk Consultants Limited 100 100 UK Services
Lombard Risk Systems (Asia Pacific) Limited — 100 Hong Kong Dormant
Lombard Risk Compliance Policies Limited 80 80 UK Software
All of the subsidiary undertakings have been included in the consolidation. Swapval Limited changed its name to Lombard Risk 
Compliance Policies Limited on 7 August 2012 and the company has since commenced trading. 20% of the issued share capital 
of the company was transferred to a third party during the year under review.
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Chairman’s statement Governance Financial statements Overview Strategic report
6. Debtors due within one year
2014
£000
2013
£000
Amounts receivable from subsidiary undertakings 7,199 5,861
Prepayments and sundry debtors 218 96
7,417 5,957
The amounts due from subsidiary companies are due on demand. However, in the opinion of the Directors, it is unlikely that 
these amounts will be fully repaid within the next financial year.
7. Creditors due within one year
2014
£000
2013
£000
Borrowings 667 1,013
Trade creditors 207 287
Accruals 168 348
1,042 1,648
8. Creditors due after one year
2014
£000
2013
£000
Borrowings — 667
Borrowings at 31 March 2014 is a Sterling bank loan. Borrowings at 31 March 2013 comprise a Sterling bank loan and a Euro 
bank loan. 
The Sterling bank loan is repayable in equal quarterly instalments over a three-year term with the first repayment in April 2012. 
The loan principal is £2.0m and interest is payable at the rate of LIBOR + 4%. The balance outstanding at 31 March 2014 was 
£0.67m (2013: £1.3m).
The Euro bank loan was repaid in one payment on 30 April 2013. The loan principal was €0.4m and interest was payable at a 
rate of LIBOR + 4.25%. The balance outstanding at 31 March 2014 was £Nil (2013: £0.3m).
9. Taxation
There is no recognised or unrecognised deferred tax asset or liability in the balance sheet.
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58
Financial statements
Notes to the Company financial statements continued
For the year ended 31 March 2014
10. Share capital
2014
£000
2013
£000
Authorised
714,034,085 Ordinary Shares of 0.5p each (2013: 714,034,085) 3,570 3,570
Allotted, called up and fully paid
263,366,260 Ordinary Shares of 0.5p each (2013: 232,409,897) 1,317 1,162
429,829,575 deferred shares of 0.1p each (2013: 429,829,575) 430 430
1,747 1,592
The deferred shares carry no rights to receive dividends or to participate in any profits of the Company. The shareholders are 
not entitled to attend any meetings of the Company or have any rights to participate in any return of capital (except on a 
winding up). The deferred shares are not transferable other than with the consent of all the Directors of the Company.
Share issue
On 28 May 2013, the Company issued 120,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 5.0p per share, which has been credited to the share premium account.
On 12 June 2013, the Company issued 120,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 5.0p per share, which has been credited to the share premium account.
On 17 July 2013, the Company issued 19,090,909 Ordinary Shares of 0.5p per share in order to accelerate growth, to recruit 
certain key staff and to provide cash for potential acquisition opportunities. The shares were issued at a premium of 10.5p 
per share, which has been credited to the share premium account, net of issue costs of £93,000.
On 17 July 2013, the Company also issued further 4,545,454 Ordinary Shares of 0.5p per share to a then prospective new 
director. The shares were issued at premium of 10.5p per share, which has been credited to the share premium account.
On 16 August 2013, the Company issued 1,000,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 5.5p per share, which has been credited to the share premium account.
On 16 August 2013, the Company issued 1,600,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 4.0p per share, which has been credited to the share premium account.
On 22 August 2013, the Company issued 2,400,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 5.0p per share, which has been credited to the share premium account.
On 7 October 2013, the Company issued 800,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 5.0p per share, which has been credited to the share premium account.
On 3 December 2013, the Company issued 80,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 8.5p per share, which has been credited to the share premium account.
On 5 December 2013, the Company issued 200,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 8.5p per share, which has been credited to the share premium account.
On 30 January 2014, the Company issued 1,000,000 Ordinary Shares of 0.5p per share as part of the Company’s share option 
scheme. The shares were issued at a premium of 5.0p per share, which has been credited to the share premium account.
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Chairman’s statement Governance Financial statements Overview Strategic report
10. Share capital continued
Share options
At start
 of year Granted Modified Exercised
Lapsed/
waived
At end
 of year
Exercise
 price (p)
Exercise
 date from
Exercise
 date to
2004 EMI 
Scheme
1,720,000 — — (280,000) (1,440,000) — 9.00 April 2008 April 2013
300,000 — — — (300,000) — 9.00 December
 2008
December
 2013
1,500,000 — — — — 1,500,000 6.00 October 2011 October 2016
1,000,000 — — (1,000,000) — — 6.00 June 2010 June 2015
1,414,365 — — (1,414,365) — — 4.50 May 2012– 
May 2014
May 2015
4,160,000 — — (3,640,000) — 520,000 5.50 January 2013 January 2016
— 1,000,000 — — — 1,000,000 12.00 April 2015 April 2018
Unapproved 
Scheme
70,000 — — — (70,000) — 9.00 April 2008 April 2013
4,585,635 — (2,000,000) (185,635) — 2,400,000 4.50 May 2012– 
May 2014
May 2015
1,600,000 — — (800,000) — 800,000 5.50 January 2013 January 2016
500,000 — — — — 500,000 12.00 April 2014 April 2017
900,000 — — — — 900,000 12.00 May 2014 May 2017
— — 2,000,000 — — 2,000,000 11.00 August 2013 July 2017
— 1,303,012 — — — 1,303,012 13.00 July 2015 July 2018
— 2,868,676 — — — 2,868,676 13.00 July 2016 July 2018
— 2,150,000 — — (450,000) 1,700,000 13.00 August 2015 August 2018
— 1,350,000 — — (300,000) 1,050,000 13.00 August 2016 August 2018
— 250,000 — — — 250,000 13.00 August 2017 August 2018
— 500,000 — — — 500,000 13.00 November 
2015
November
 2018
— 250,000 — — — 250,000 13.00 November 
2016
November
 2018
— 250,000 — — — 250,000 13.00 November
 2017
November
 2018
— 2,000,000 — — — 2,000,000 14.00 January 2016 January 2019
CSOP 
Scheme
— 3,428,312 — — — 3,428,312 12.00 March 2017 March 2024 
 
17,750,000 15,350,000 — (7,320,000) (2,560,000) 23,220,000 
2,000,000 share options were modified during the year under review. The cost of the modification has been calculated 
as the difference between the fair value of the original share option price and the fair value of the re- share options, both 
measured at the modification date. The cost of the modification is £130,000 and this amount has been debited directly 
to the other reserves within equity. 
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60
Financial statements
Notes to the Company financial statements continued
For the year ended 31 March 2014
11. Share premium and other reserves
Share 
capital
£000
Share 
premium
account
£000
Other
reserves
£000
Profit 
and loss 
account
£000
Shareholders’
funds
£000
Balance at 1 April 2013 1,592 6,622 7,197 1,051 16,462
Issue of share capital, net of issue costs 155 2,753 — — 2,908
Profit for the year — — — 200 200
Dividend — — — (172) (172)
Share-based payment charge — — 67 — 67
Share option modification expense — — (130) — (130)
Share option lapsed or exercised — — (87) 87 —
Balance at 31 March 2014 1,747 9,375 7,047 1,166 19,335
Other reserves relate to negative goodwill arising on the acquisition of a subsidiary undertaking prior to 1 April 1997, merger 
reserve and net foreign exchange movements in connection with overseas subsidiaries.
12. Related party transactions
The Company has taken advantage of the exemption in Financial Reporting Standard 8 “Related party disclosures” and has 
not disclosed transactions with wholly owned Group undertakings.
The Company charged £145,000 (2013: £64,000) to Lombard Risk Compliance Policies Limited in respect of support services 
provided. In addition, working capital support was made total of £115,000 (2013: £199,000). The balance owed by Lombard 
Risk Compliance Policies Limited to the Company at 31 March 2014 is £523,000 (2013: £263,000). 
Lombard Risk Management plc has provided a letter of guarantee to Lombard Risk Compliance Policies Limited confirming 
that it will provide it with working capital support, if required, until 31 May 2015.
There are no other related party transactions in this reporting year or comparative period.
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Company registration number
03224870
Directors
Philip Crawford 
Chairman
John Wisbey
Chief Executive Officer
Nick Davies
Chief Technology Officer
John McCormick
Senior Non-executive Director
Steve Rogers
Non-executive Director
Company Secretary
Lisa Tan
Registered office
7th Floor  
Ludgate House 
245 Blackfriars Road 
London SE1 9UF
Nominated adviser and broker
Charles Stanley Securities
131 Finsbury Pavement  
London EC2A 1NT
Auditor
Grant Thornton UK LLP
Grant Thornton House 
Melton Street 
Euston Square 
London NW1 2EP
Corporate solicitors
Memery Crystal
44 Southampton Buildings 
London WC2A 1AP
Registrars
Computershare Investor Services PLC
PO Box 859 
The Pavilions 
Bridgwater Road 
Bristol BS99 1XZ
Date
Annual General Meeting 
9 July 2014
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Lombard Risk Management plc
7th Floor 
Ludgate House 
245 Blackfriars Road 
London SE1 9UF 
UK 
tel: +44 (0)20 7593 6700 
fax: +44 (0)20 7593 6780 
e: investorrelations@lombardrisk.com
www.lombardrisk.com
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