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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549





FORM 20-F/A







| ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------------

OR



|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended: 28 December 2012

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

OR



| ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------

Date of event requiring this shell company report

For the transition period from  to

Commission file number 001-35265





CSR plc

(Exact name of Registrant as specified in its charter)





ENGLAND

(Jurisdiction of
incorporation or organization)

Churchill House, Cambridge Business Park, Cowley Road, Cambridge, CB4 0WZ, England,

Tel: +44 (0) 1223 692 000

(Address of principal executive offices)

Adam R. Dolinko, General Counsel  Tel: +44 (0) 1223 692 000, Fax: +44 (0) 1223 692 001

Churchill House, Cambridge Business Park, Cowley Road, Cambridge CB4 0WZ, England

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:



|                                            |  |                                          
|------------------------------------------- |  | -----------------------------------------
|Title of Each Class                         |  | Name of Each Exchange on which Registered
|Ordinary shares, par value £0.001 per share |  | NASDAQ Global Select Market*             



|* | Listed, not for trading, but only in connection with the registration of the American Depositary Shares, each representing four (4) ordinary shares.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------





Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which
there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the issuers
classes of capital or common stock as of the close of the period covered by the annual report.



|                                  |  |            
|--------------------------------- |  | -----------
|Ordinary Shares, par value £0.001 |  | 181,896,339

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act.    Yes  x    No   ̈

If
this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.    Yes   ̈    No  x

Indicate by check mark whether the Registrant (1) has
filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90
days.    Yes  x    No   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).    Yes   ̈    No   ̈

Not Applicable.

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):



|                           |  |                      |  |                         
|-------------------------- |  | -------------------- |  | ------------------------
|Large accelerated filer  x |  | Accelerated filer   ̈ |  | Non-accelerated filer   ̈

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this
filing:



|             |  |                                                                                                          |  |          
|------------ |  | -------------------------------------------------------------------------------------------------------- |  | ---------
|U.S.
GAAP   ̈ |  | International Financial Reporting Standards as issued by the International Accounting Standards Board  x |  | Other  
 ̈

If Other has been checked in response to the previous question, indicate by check mark which financial statement item
the registrant has elected to follow.    Item
17   ̈    Item 18   ̈

If
this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  
 ̈    No  x

(APPLICABLE ONLY TO ISSUERS INVOLVED
IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS.)

Indicate by check mark whether the registrant has filed all documents and reports required to be
filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.    Yes   ̈    No   ̈









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Explanatory Note

This
Amendment No. 1 on Form 20-F/A (the Amendment) amends the 2012 annual report (the 2012 Report) on Form 20-F of CSR plc (the Company) as originally filed with the Securities and Exchange Commission on March 28,
2013. The Amendment does not contain any changes to the consolidated financial statements of the Company at and for the 52 week period ended 28 December 2012 (the Consolidated Financial Statements) or any prior period. Other than
as expressly set forth below, the Amendment does not, and does not purport to, revise, update, amend or restate the information presented in any item of the 2012 Report or reflect any events that have occurred since the filing of the 2012 Report.
The 2012 Report inadvertently duplicated the attestation report issued by Deloitte LLP, the Companys independent registered public accounting firm, on managements assessment of the Companys internal control over financial reporting
(the ICFR Report) required under Item 15(c) of Form 20-F. The Amendment replaces, on page 81, the duplicate ICFR Report with the audit report (the Audit Report) issued by Deloitte LLP on February 20, 2013 in respect of the
Companys Consolidated Financial Statements required under Item 8 of the Form 20-F. The Amendment includes the Consolidated Financial Statements. The Company filed as exhibit 15.1 to the 2012 Report the consent issued by Deloitte LLP to the
incorporation by reference of the Audit Report and the ICFR Report in the Companys Registration Statements on Form S-8.



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Financial statements



|                                                                    |  |                                                        
|------------------------------------------------------------------- |  | -------------------------------------------------------
|Financial and other information  consolidated financial statements
|81                                                                  |  | Report of Independent Registered Public Accounting Firm
|83                                                                  |  | Consolidated income statement                          
|84                                                                  |  | Consolidated statement of comprehensive income         
|85                                                                  |  | Consolidated balance sheet                             
|86                                                                  |  | Consolidated statement of changes in equity            
|88                                                                  |  | Consolidated cash flow statement                       
|89                                                                  |  | Notes to the consolidated financial statements         



|                                                    |  | 
|--------------------------------------------------- |  | 
|CSR plc Annual Report and Financial Statements
2012 |  | 



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Financial statements



REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM



To the Board of Directors and Shareholders of CSR plc

We have audited the accompanying consolidated balance sheets of CSR plc and subsidiaries (the Company) at 28 December 2012 and
30 December 2011, and the related consolidated income statements, consolidated statements of comprehensive income, consolidated statements of changes in equity and consolidated cash flow statements for each of the 52 week periods ended
28 December 2012, 30 December 2011 and 31 December 2010. These consolidated financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable
basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of CSR
plc and subsidiaries at 28 December 2012 and 30 December 2011 and the results of their operations and their cash flows for each of the 52 week periods ended 28 December 2012, 30 December 2011 and 31 December 2010, in
conformity with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Companys internal control over financial reporting as of 28 December 2012,
based on the criteria established in Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated 20 February 2013 expressed an unqualified opinion on the
Companys internal control over financial reporting.



/s/ Deloitte LLP

London, United Kingdom

20 February 2013



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##### Table of Contents

Financial statements



Consolidated income statement



|                                                                                |  |       |     |  |                                     |  |           |                                     |  |  |                                     |   |  |  |          |  
|------------------------------------------------------------------------------- |  | ----- | --- |  | ----------------------------------- |  | --------- | ----------------------------------- |  |  | ----------------------------------- | - |  |  | -------- | -
|                                                                                |  | Notes |     |  | 52 weeks ended28 December 2012$000 |  |           | 52 weeks ended30 December 2011$000 |  |  | 52 weeks ended31 December 2010$000 |  
|Revenue                                                                         |  |       | 5,6 |  |                                     |  | 1,025,356 |                                     |  |  | 845,190                             |   |  |  | 800,608  |  
|Amortisation of acquired intangible assets                                      |  |       |     |  |                                     |  | (11,342   | )                                   |  |  | (8,224                              | ) |  |  | (5,663   | )
|Fair value adjustment to inventory                                              |  |       |     |  |                                     |  |          |                                     |  |  | (28,187                             | ) |  |  |         |  
|Other cost of sales                                                             |  |       |     |  |                                     |  | (504,937  | )                                   |  |  | (424,044                            | ) |  |  | (418,367 | )
|Total cost of sales                                                             |  |       |     |  |                                     |  | (516,279  | )                                   |  |  | (460,455                            | ) |  |  | (424,030 | )
|Gross profit                                                                    |  |       |     |  |                                     |  | 509,077   |                                     |  |  | 384,735                             |   |  |  | 376,578  |  
|Research and development (R&D) expenses:                                      |  |       |     |  |                                     |  |           |                                     |  |  |                                     |   |  |  |          |  
|Other research and development expenses                                         |  |       |     |  |                                     |  | (272,328  | )                                   |  |  | (228,573                            | ) |  |  | (189,187 | )
|Share-based payment charges                                                     |  |       |     |  |                                     |  | (14,894   | )                                   |  |  | (7,665                              | ) |  |  | (5,760   | )
|Amortisation of acquired intangible assets                                      |  |       |     |  |                                     |  | (3,124    | )                                   |  |  | (5,525                              | ) |  |  | (4,980   | )
|Total research and development expenses                                         |  |       |     |  |                                     |  | (290,346  | )                                   |  |  | (241,763                            | ) |  |  | (199,927 | )
|Sales, general and administrative expenses
(SG&A):                            |  |       |     |  |                                     |  |           |                                     |  |  |                                     |   |  |  |          |  
|Other sales, general and administrative expenses                                |  |       |     |  |                                     |  | (174,062  | )                                   |  |  | (143,367                            | ) |  |  | (114,078 | )
|Share-based payment charges                                                     |  |       |     |  |                                     |  | (12,859   | )                                   |  |  | (6,465                              | ) |  |  | (4,062   | )
|Amortisation of acquired intangible assets                                      |  |       |     |  |                                     |  | (8,266    | )                                   |  |  | (4,932                              | ) |  |  | (3,494   | )
|Integration and restructuring expenses                                          |  |       | 33  |  |                                     |  | (27,523   | )                                   |  |  | (33,721                             | ) |  |  | (1,085   | )
|Acquisition or disposal related fees                                            |  |       |     |  |                                     |  |          |                                     |  |  | (13,004                             | ) |  |  | (397     | )
|Litigation and patent settlements charges                                       |  |       |     |  |                                     |  | (15,500   | )                                   |  |  | (6,000                              | ) |  |  | (59,788  | )
|Litigation settlement income                                                    |  |       |     |  |                                     |  |          |                                     |  |  | 14,532                              |   |  |  |         |  
|De-recognition of contingent consideration                                      |  |       |     |  |                                     |  |          |                                     |  |  | 1,620                               |   |  |  |         |  
|Other operating income                                                          |  |       |     |  |                                     |  | 214       |                                     |  |  |                                    |   |  |  |         |  
|Total sales, general and administrative expenses                                |  |       |     |  |                                     |  | (237,996  | )                                   |  |  | (191,337                            | ) |  |  | (182,904 | )
|Gain on disposal of development operations in handset connectivity and
location |  |       | 38  |  |                                     |  | 127,178   |                                     |  |  |                                    |   |  |  |         |  
|Operating profit (loss)                                                         |  |       |     |  |                                     |  | 107,913   |                                     |  |  | (48,365                             | ) |  |  | (6,253   | )
|Investment income                                                               |  |       | 10  |  |                                     |  | 1,161     |                                     |  |  | 1,627                               |   |  |  | 812      |  
|Other gains and losses                                                          |  |       | 11  |  |                                     |  | 14        |                                     |  |  | 320                                 |   |  |  | 640      |  
|Exchange losses                                                                 |  |       |     |  |                                     |  | (395      | )                                   |  |  | (748                                | ) |  |  | (186     | )
|Finance costs                                                                   |  |       | 12  |  |                                     |  | (6,711    | )                                   |  |  | (4,298                              | ) |  |  | (718     | )
|Profit (loss) before tax                                                        |  |       |     |  |                                     |  | 101,982   |                                     |  |  | (51,464                             | ) |  |  | (5,705   | )
|Tax                                                                             |  |       | 14  |  |                                     |  | (50,749   | )                                   |  |  | 85,330                              |   |  |  | 22,331   |  
|Profit for the period                                                           |  |       | 7   |  |                                     |  | 51,233    |                                     |  |  | 33,866                              |   |  |  | 16,626   |  
|Earnings per share                                                              |  |       |     |  |                                     |  |           |                                     |  |  |                                     |   |  |  |          |  
|                                                                                |  |       |     |  |                                     |  | $         |                                     |  |  | $                                   |   |  |  | $        |  
|Basic                                                                           |  |       | 15  |  |                                     |  | 0.26      |                                     |  |  | 0.19                                |   |  |  | 0.09     |  
|Diluted                                                                         |  |       | 15  |  |                                     |  | 0.25      |                                     |  |  | 0.19                                |   |  |  | 0.09     |  

The results are all derived from continuing operations. The profit for the period and the profit for the prior periods are wholly
attributable to equity holders of the parent company, CSR plc.



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##### Table of Contents

Financial statements

continued

Consolidated statement of comprehensive income



|                                                                 |  |       |    |  |                                     |  |        |                                     |  |  |                                     |   |  |  |        |  
|---------------------------------------------------------------- |  | ----- | -- |  | ----------------------------------- |  | ------ | ----------------------------------- |  |  | ----------------------------------- | - |  |  | ------ | -
|                                                                 |  | Notes |    |  | 52 weeks ended28 December 2012$000 |  |        | 52 weeks ended30 December 2011$000 |  |  | 52 weeks ended31 December 2010$000 |  
|Profit for the period                                            |  |       |    |  |                                     |  | 51,233 |                                     |  |  | 33,866                              |   |  |  | 16,626 |  
|Other comprehensive income                                       |  |       |    |  |                                     |  |        |                                     |  |  |                                     |   |  |  |        |  
|Gain (loss) on cash flow hedges                                  |  |       | 29 |  |                                     |  | 4,935  |                                     |  |  | 1,661                               |   |  |  | (3,108 | )
|Net tax on cash flow hedges in statement of comprehensive income |  |       | 29 |  |                                     |  | (1,210 | )                                   |  |  | (427                                | ) |  |  | 870    |  
|Transferred to income statement in respect of cash flow hedges   |  |       | 29 |  |                                     |  | (1,040 | )                                   |  |  | (4,184                              | ) |  |  | 726    |  
|Tax on items transferred from statement of comprehensive income  |  |       | 29 |  |                                     |  | 253    |                                     |  |  | 1,080                               |   |  |  | (199   | )
|Actuarial losses in defined benefit plans                        |  |       | 35 |  |                                     |  | (919   | )                                   |  |  | (435                                | ) |  |  |       |  
|Pension scheme assets above the threshold                        |  |       | 35 |  |                                     |  | (656   | )                                   |  |  |                                    |   |  |  |       |  
|Total comprehensive income for the period                        |  |       |    |  |                                     |  | 52,596 |                                     |  |  | 31,561                              |   |  |  | 14,915 |  

The total comprehensive income for all periods is wholly attributable to equity holders of the parent company, CSR plc.



|                                                    |  | 
|--------------------------------------------------- |  | 
|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Financial statements



Consolidated balance sheet



|                                       |  |       |    |  |                       |  |           |                       |  |  |           |  
|-------------------------------------- |  | ----- | -- |  | --------------------- |  | --------- | --------------------- |  |  | --------- | -
|                                       |  | Notes |    |  | 28 December 2012$000 |  |           | 30 December 2011$000 | 
|Non-current assets                     |  |       |    |  |                       |  |           |                       |  |  |           |  
|Goodwill                               |  |       | 16 |  |                       |  | 181,877   |                       |  |  | 332,749   |  
|Other intangible assets                |  |       | 17 |  |                       |  | 120,673   |                       |  |  | 127,747   |  
|Property, plant and equipment          |  |       | 18 |  |                       |  | 26,349    |                       |  |  | 34,520    |  
|Investments                            |  |       | 19 |  |                       |  | 3,719     |                       |  |  | 3,610     |  
|Deferred tax asset                     |  |       | 24 |  |                       |  | 89,193    |                       |  |  | 118,442   |  
|Long term asset                        |  |       | 20 |  |                       |  | 31,000    |                       |  |  |          |  
|                                       |  |       |    |  |                       |  | 452,811   |                       |  |  | 617,068   |  
|Current assets                         |  |       |    |  |                       |  |           |                       |  |  |           |  
|Inventories                            |  |       | 21 |  |                       |  | 87,850    |                       |  |  | 120,347   |  
|Derivative financial instruments       |  |       | 23 |  |                       |  | 2,702     |                       |  |  | 148       |  
|Trade and other receivables            |  |       | 22 |  |                       |  | 117,706   |                       |  |  | 123,797   |  
|Corporation tax debtor                 |  |       |    |  |                       |  | 6,379     |                       |  |  | 11,808    |  
|Treasury deposits and investments      |  |       | 22 |  |                       |  | 18,491    |                       |  |  | 65,938    |  
|Cash and cash equivalents              |  |       | 22 |  |                       |  | 314,760   |                       |  |  | 211,907   |  
|                                       |  |       |    |  |                       |  | 547,888   |                       |  |  | 533,945   |  
|Total assets                           |  |       |    |  |                       |  | 1,000,699 |                       |  |  | 1,151,013 |  
|Current liabilities                    |  |       |    |  |                       |  |           |                       |  |  |           |  
|Trade and other payables               |  |       | 26 |  |                       |  | 227,777   |                       |  |  | 180,621   |  
|Current tax liabilities                |  |       |    |  |                       |  | 14,509    |                       |  |  | 9,613     |  
|Obligations under finance leases       |  |       | 25 |  |                       |  | 1,393     |                       |  |  | 16        |  
|Derivative financial instruments       |  |       | 23 |  |                       |  |          |                       |  |  | 1,585     |  
|Provisions                             |  |       | 27 |  |                       |  | 16,742    |                       |  |  | 29,495    |  
|                                       |  |       |    |  |                       |  | 260,421   |                       |  |  | 221,330   |  
|Net current assets                     |  |       |    |  |                       |  | 287,467   |                       |  |  | 312,615   |  
|Non-current liabilities                |  |       |    |  |                       |  |           |                       |  |  |           |  
|Trade and other payables               |  |       | 26 |  |                       |  | 35,846    |                       |  |  | 49,590    |  
|Deferred tax liability                 |  |       | 24 |  |                       |  | 4,891     |                       |  |  |          |  
|Long-term provisions                   |  |       | 27 |  |                       |  | 4,395     |                       |  |  | 1,926     |  
|Obligations under finance leases       |  |       | 25 |  |                       |  | 170       |                       |  |  | 143       |  
|Defined benefit pension scheme deficit |  |       | 35 |  |                       |  | 42        |                       |  |  | 117       |  
|                                       |  |       |    |  |                       |  | 45,344    |                       |  |  | 51,776    |  
|Total liabilities                      |  |       |    |  |                       |  | 305,765   |                       |  |  | 273,106   |  
|Net assets                             |  |       |    |  |                       |  | 694,934   |                       |  |  | 877,907   |  
|Equity                                 |  |       |    |  |                       |  |           |                       |  |  |           |  
|Share capital                          |  |       | 28 |  |                       |  | 317       |                       |  |  | 372       |  
|Share premium account                  |  |       | 29 |  |                       |  | 523,654   |                       |  |  | 473,462   |  
|Capital redemption reserve             |  |       | 29 |  |                       |  | 1,029     |                       |  |  | 950       |  
|Merger reserve                         |  |       | 29 |  |                       |  | 61,574    |                       |  |  | 61,574    |  
|Employee benefit trust reserve         |  |       | 29 |  |                       |  | (19,163   | )                     |  |  | (33,971   | )
|Hedging reserve                        |  |       | 29 |  |                       |  | 2,495     |                       |  |  | (1,400    | )
|Share-based payment reserve            |  |       | 29 |  |                       |  | 112,677   |                       |  |  | 88,197    |  
|Tax reserve                            |  |       | 29 |  |                       |  | 41,630    |                       |  |  | 41,583    |  
|Treasury shares                        |  |       | 29 |  |                       |  | (86,929   | )                     |  |  | (84,660   | )
|Retained earnings                      |  |       | 29 |  |                       |  | 57,650    |                       |  |  | 331,800   |  
|Total equity                           |  |       |    |  |                       |  | 694,934   |                       |  |  | 877,907   |  

The consolidated financial statements of CSR plc were approved by the Board of directors and authorised for issue on
20 February 2013.

They were signed on its behalf by:

Will Gardiner
                                         
                                         
      Ron Mackintosh



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##### Table of Contents

Financial statements

continued

Consolidated statement of changes in equity



|                                                                  |  |                            |     |   |                          |  |         |                               |  |  |                    |  |  |                                  |        |  |                     |  |         |                                 |  |  |                 |   |  |                     |         |  |                       |  |        |            |  |  |         |   |  |  |          |   |  |  |          |  
|----------------------------------------------------------------- |  | -------------------------- | --- | - | ------------------------ |  | ------- | ----------------------------- |  |  | ------------------ |  |  | -------------------------------- | ------ |  | ------------------- |  | ------- | ------------------------------- |  |  | --------------- | - |  | ------------------- | ------- |  | --------------------- |  | ------ | ---------- |  |  | ------- | - |  |  | -------- | - |  |  | -------- | -
|                                                                  |  | Called-upsharecapital$000 |     |   | Sharepremiumaccount$000 |  |         | Capitalredemptionreserve$000 |  |  | Mergerreserve$000 |  |  | EmployeeBenefitTrustreserve$000 |        |  | Hedgingreserve$000 |  |         | Share -basedpaymentreserve$000 |  |  | Taxreserve$000 |   |  | Treasuryshares$000 |         |  | Retainedearnings$000 |  |        | Total$000 | 
|At 31 December 2011                                               |  |                            | 372 |   |                          |  | 473,462 |                               |  |  | 950                |  |  |                                  | 61,574 |  |                     |  | (33,971 | )                               |  |  | (1,400          | ) |  |                     | 88,197  |  |                       |  | 41,583 |            |  |  | (84,660 | ) |  |  | 331,800  |   |  |  | 877,907  |  
|Profit for the period                                             |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  |        |   |  |  | 51,233   |   |  |  | 51,233   |  
|Other comprehensive income for the period                         |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  | 3,895           |   |  |                     |        |  |                       |  | (957   | )          |  |  |        |   |  |  | (1,575   | ) |  |  | 1,363    |  
|Total comprehensive income for the period                         |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  | 3,895           |   |  |                     |        |  |                       |  | (957   | )          |  |  |        |   |  |  | 49,658   |   |  |  | 52,596   |  
|Share issues (net of share issue costs)                           |  |                            | 24  |   |                          |  | 48,642  |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  |        |   |  |  |         |   |  |  | 48,666   |  
|Repurchase and cancellation of ordinary shares under tender offer |  |                            | (79 | ) |                          |  |        |                               |  |  | 79                 |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  |        |   |  |  | (284,278 | ) |  |  | (284,278 | )
|Share issue costs                                                 |  |                            |    |   |                          |  | 1,550   |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  |        |   |  |  | (1,839   | ) |  |  | (289     | )
|Shares issued from Employee Benefit Trust Reserve                 |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  | 14,808  |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  |        |   |  |  | (13,158  | ) |  |  | 1,650    |  
|Credit to equity for equity-settled share-based payments          |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     | 24,480  |  |                       |  |       |            |  |  |        |   |  |  |         |   |  |  | 24,480   |  
|Shares issued from Treasury                                       |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  | 7,203   |   |  |  | (3,268   | ) |  |  | 3,935    |  
|Purchase of Treasury Shares                                       |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  | (9,472  | ) |  |  |         |   |  |  | (9,472   | )
|Effective rate adjustment                                         |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  | (5     | )          |  |  |        |   |  |  |         |   |  |  | (5       | )
|Credit to equity on recognition of losses                         |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  | 436    |            |  |  |        |   |  |  |         |   |  |  | 436      |  
|Deferred tax on share-based payment transactions                  |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  | 573    |            |  |  |        |   |  |  |         |   |  |  | 573      |  
|Equity dividends issued to shareholders                           |  |                            |    |   |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                 |  |  |                |   |  |                     |        |  |                       |  |       |            |  |  |        |   |  |  | (21,265  | ) |  |  | (21,265  | )
|At 28 December 2012                                               |  |                            | 317 |   |                          |  | 523,654 |                               |  |  | 1,029              |  |  |                                  | 61,574 |  |                     |  | (19,163 | )                               |  |  | 2,495           |   |  |                     | 112,677 |  |                       |  | 41,630 |            |  |  | (86,929 | ) |  |  | 57,650   |   |  |  | 694,934  |  



|                                                    |  | 
|--------------------------------------------------- |  | 
|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Consolidated statement of changes in equity



Financial statements



|                                                                                           |  |                            |     |  |                          |  |         |                               |  |  |                    |  |  |                                  |        |  |                     |  |         |                                  |  |  |                 |   |  |                     |        |  |                       |  |        |            |  |  |         |   |  |  |         |   |  |  |         |  
|------------------------------------------------------------------------------------------ |  | -------------------------- | --- |  | ------------------------ |  | ------- | ----------------------------- |  |  | ------------------ |  |  | -------------------------------- | ------ |  | ------------------- |  | ------- | -------------------------------- |  |  | --------------- | - |  | ------------------- | ------ |  | --------------------- |  | ------ | ---------- |  |  | ------- | - |  |  | ------- | - |  |  | ------- | -
|                                                                                           |  | Called-upsharecapital$000 |     |  | Sharepremiumaccount$000 |  |         | Capitalredemptionreserve$000 |  |  | Mergerreserve$000 |  |  | EmployeeBenefitTrustreserve$000 |        |  | Hedgingreserve$000 |  |         | Share basedpaymentreserve $000 |  |  | Taxreserve$000 |   |  | Treasuryshares$000 |        |  | Retainedearnings$000 |  |        | Total$000 | 
|At 1 January 2011                                                                          |  |                            | 322 |  |                          |  | 368,615 |                               |  |  | 950                |  |  |                                  | 61,574 |  |                     |  | (39,064 | )                                |  |  | 1,123           |   |  |                     | 58,038 |  |                       |  | 41,641 |            |  |  | (37,487 | ) |  |  | 318,852 |   |  |  | 774,564 |  
|Profit for the period                                                                      |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  | 33,866  |   |  |  | 33,866  |  
|Other comprehensive income for the period                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  | (2,523          | ) |  |                     |       |  |                       |  | 653    |            |  |  |        |   |  |  | (435    | ) |  |  | (2,305  | )
|Total comprehensive income for the period                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  | (2,523          | ) |  |                     |       |  |                       |  | 653    |            |  |  |        |   |  |  | 33,431  |   |  |  | 31,561  |  
|Share issues (net of share issue costs)                                                    |  |                            | 50  |  |                          |  | 104,847 |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  |        |   |  |  | 104,897 |  
|Shares issued from Employee Benefit Trust Reserve                                          |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  | 5,093   |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  | (4,134  | ) |  |  | 959     |  
|Credit to equity for equity-settled share-based payments                                   |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     | 13,583 |  |                       |  |       |            |  |  |        |   |  |  |        |   |  |  | 13,583  |  
|Credit to equity for equity-settled share-based payments on
acquisition                    |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     | 16,576 |  |                       |  |       |            |  |  |        |   |  |  |        |   |  |  | 16,576  |  
|Purchase of Treasury Shares                                                                |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  | (47,173 | ) |  |  |        |   |  |  | (47,173 | )
|Effective rate adjustment                                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | (66    | )          |  |  |        |   |  |  |        |   |  |  | (66     | )
|Deferred tax on share-based payment transactions                                           |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | (645   | )          |  |  |        |   |  |  |        |   |  |  | (645    | )
|Current tax benefit taken directly to equity on share option gains                         |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | (162   | )          |  |  |        |   |  |  |        |   |  |  | (162    | )
|Credit to equity on recognition of losses                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | 162    |            |  |  |        |   |  |  |        |   |  |  | 162     |  
|Equity dividends issued to shareholders                                                    |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  | (16,349 | ) |  |  | (16,349 | )
|At 30 December 2011                                                                        |  |                            | 372 |  |                          |  | 473,462 |                               |  |  | 950                |  |  |                                  | 61,574 |  |                     |  | (33,971 | )                                |  |  | (1,400          | ) |  |                     | 88,197 |  |                       |  | 41,583 |            |  |  | (84,660 | ) |  |  | 331,800 |   |  |  | 877,907 |  
|At 2 January 2010                                                                          |  |                            | 318 |  |                          |  | 363,032 |                               |  |  | 950                |  |  |                                  | 61,574 |  |                     |  | (40,224 | )                                |  |  | 3,505           |   |  |                     | 48,446 |  |                       |  | 33,433 |            |  |  | -       |   |  |  | 303,077 |   |  |  | 774,111 |  
|Profit for the period                                                                      |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  | 16,626  |   |  |  | 16,626  |  
|Other comprehensive income for the period                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  | (2,382          | ) |  |                     |       |  |                       |  | 671    |            |  |  |        |   |  |  |        |   |  |  | (1,711  | )
|Total comprehensive income for the period                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  | (2,382          | ) |  |                     |       |  |                       |  | 671    |            |  |  |        |   |  |  | 16,626  |   |  |  | 14,915  |  
|Share issues (net of share issue costs)                                                    |  |                            | 4   |  |                          |  | 5,583   |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  |        |   |  |  | 5,587   |  
|Shares issued from Employee Benefit Trust Reserve                                          |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  | 1,160   |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  |        |   |  |  | (851    | ) |  |  | 309     |  
|Credit to equity for equity-settled share-based payments                                   |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     | 9,592  |  |                       |  |       |            |  |  |        |   |  |  |        |   |  |  | 9,592   |  
|Purchase of Treasury Shares                                                                |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  |       |            |  |  | (37,487 | ) |  |  |        |   |  |  | (37,487 | )
|Effective rate adjustment                                                                  |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | (12    | )          |  |  |        |   |  |  |        |   |  |  | (12     | )
|Current tax benefit relating to prior years taken directly to equity on share
option gains |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | 7,367  |            |  |  |        |   |  |  |        |   |  |  | 7,367   |  
|Deferred tax on share-based payment transactions                                           |  |                            |    |  |                          |  |        |                               |  |  |                   |  |  |                                  |       |  |                     |  |        |                                  |  |  |                |   |  |                     |       |  |                       |  | 182    |            |  |  |        |   |  |  |        |   |  |  | 182     |  
|At 31 December 2010                                                                        |  |                            | 322 |  |                          |  | 368,615 |                               |  |  | 950                |  |  |                                  | 61,574 |  |                     |  | (39,064 | )                                |  |  | 1,123           |   |  |                     | 58,038 |  |                       |  | 41,641 |            |  |  | (37,487 | ) |  |  | 318,852 |   |  |  | 774,564 |  



|            |  |    |  |  |    | 
|----------- |  | -- |  |  | -- | 
|www.csr.com |  | 86 |  |  | 87 | 



---

##### Table of Contents

Financial statements

continued

Consolidated cash flow statement



|                                                                                     |  |       |    |  |                                     |  |          |                                     |  |  |                                     |   |  |  |          |  
|------------------------------------------------------------------------------------ |  | ----- | -- |  | ----------------------------------- |  | -------- | ----------------------------------- |  |  | ----------------------------------- | - |  |  | -------- | -
|                                                                                     |  | Notes |    |  | 52 weeks ended28 December 2012$000 |  |          | 52 weeks ended30 December 2011$000 |  |  | 52 weeks ended31 December 2010$000 |  
|Net cash from operating activities                                                   |  |       | 30 |  |                                     |  | 73,928   |                                     |  |  | 12,640                              |   |  |  | 77,907   |  
|Investing activities                                                                 |  |       |    |  |                                     |  |          |                                     |  |  |                                     |   |  |  |          |  
|Interest received                                                                    |  |       |    |  |                                     |  | 1,163    |                                     |  |  | 1,299                               |   |  |  | 790      |  
|Proceeds on disposal of property, plant and equipment                                |  |       |    |  |                                     |  | 73       |                                     |  |  |                                    |   |  |  |         |  
|Purchase of treasury deposits (including treasury deposits acquired with
subsidiary) |  |       |    |  |                                     |  | (111,629 | )                                   |  |  | (180,980                            | ) |  |  | (728,990 | )
|Sales of treasury deposits                                                           |  |       |    |  |                                     |  | 159,076  |                                     |  |  | 413,786                             |   |  |  | 703,560  |  
|Purchases of property, plant and equipment                                           |  |       |    |  |                                     |  | (12,019  | )                                   |  |  | (14,573                             | ) |  |  | (7,750   | )
|Purchases of intangible assets                                                       |  |       |    |  |                                     |  | (13,610  | )                                   |  |  | (4,245                              | ) |  |  | (6,771   | )
|Disposal of development operations                                                   |  |       | 38 |  |                                     |  | 271,323  |                                     |  |  |                                    |   |  |  |         |  
|Acquisition of UK based capabilities in DDFA                                         |  |       |    |  |                                     |  | (2,667   | )                                   |  |  |                                    |   |  |  |         |  
|Stamp duty                                                                           |  |       |    |  |                                     |  | 126      |                                     |  |  |                                    |   |  |  |         |  
|Acquisition of subsidiaries, net of cash acquired                                    |  |       | 39 |  |                                     |  |         |                                     |  |  | (123,862                            | ) |  |  | (1,902   | )
|Purchase of investment                                                               |  |       |    |  |                                     |  | (109     | )                                   |  |  | (2,610                              | ) |  |  | (1,000   | )
|Net cash from (used in) investing activities                                         |  |       |    |  |                                     |  | 291,727  |                                     |  |  | 88,815                              |   |  |  | (42,063  | )
|Financing activities                                                                 |  |       |    |  |                                     |  |          |                                     |  |  |                                     |   |  |  |          |  
|Repayments of obligations under finance leases                                       |  |       |    |  |                                     |  | (540     | )                                   |  |  |                                    |   |  |  | (318     | )
|Repayment of borrowings                                                              |  |       | 39 |  |                                     |  |         |                                     |  |  |                                    |   |  |  | (2,041   | )
|Purchase of treasury shares                                                          |  |       |    |  |                                     |  | (9,471   | )                                   |  |  | (47,511                             | ) |  |  | (37,487  | )
|Proceeds on issue of shares                                                          |  |       |    |  |                                     |  | 48,659   |                                     |  |  | 1,365                               |   |  |  | 5,661    |  
|Proceeds on issue of shares from the Employee Benefit Trust                          |  |       |    |  |                                     |  | 553      |                                     |  |  | 1,380                               |   |  |  | 225      |  
|Proceeds on issue of shares from Treasury                                            |  |       |    |  |                                     |  | 3,935    |                                     |  |  |                                    |   |  |  |         |  
|Repurchase of ordinary shares through tender offer                                   |  |       |    |  |                                     |  | (284,278 | )                                   |  |  |                                    |   |  |  |         |  
|Equity dividends paid to shareholders                                                |  |       |    |  |                                     |  | (21,265  | )                                   |  |  | (16,349                             | ) |  |  |         |  
|Net cash used in financing activities                                                |  |       |    |  |                                     |  | (262,407 | )                                   |  |  | (61,115                             | ) |  |  | (33,960  | )
|Net increase in cash and cash equivalents                                            |  |       |    |  |                                     |  | 103,248  |                                     |  |  | 40,340                              |   |  |  | 1,884    |  
|Cash and cash equivalents at beginning of period                                     |  |       |    |  |                                     |  | 211,907  |                                     |  |  | 172,315                             |   |  |  | 170,601  |  
|Effect of foreign exchange rate changes                                              |  |       |    |  |                                     |  | (395     | )                                   |  |  | (748                                | ) |  |  | (170     | )
|Cash and cash equivalents at end of period                                           |  |       |    |  |                                     |  | 314,760  |                                     |  |  | 211,907                             |   |  |  | 172,315  |  



|                                                    |  | 
|--------------------------------------------------- |  | 
|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Financial statements



Notes to the consolidated financial
statements



1. General Information

CSR plc is a company incorporated in the United Kingdom under the Companies Act 2006. The address of the registered office is Churchill House, Cambridge Business
Park, Cowley Road, Cambridge, CB4 0WZ, United Kingdom. CSR is a leading provider of multifunction connectivity, audio and location platforms.

These
financial statements are presented in US dollars because that is the currency of the primary economic environment in which the Group operates. Foreign operations are included in accordance with the policies set out in note 3.

Going concern

The financial statements have been
prepared on the going concern basis. The directors have considered future cash forecasts and revenue projections, based on prudent market data, in their consideration of going concern. The issues surrounding going concern are discussed regularly by
the Board and were evaluated as part of the Groups budget for the next financial year and the Groups longer term plans.

Note 36 includes the
Groups objectives, policies and processes for managing its capital; its financial risk management objectives; details of the financial instruments and hedging activities; and its exposure to credit risk. Management is currently of the opinion
that the Group has adequate financial resources and a robust policy towards treasury risk and cash flow management. The Group has $333.3 million of cash and cash equivalents, including treasury deposits and investments, as at 2012 and no debt
liabilities.

The directors believe that the Group is securely placed to manage its business risks successfully despite continuing uncertainties with the
economic outlook and challenging macro economic conditions.

After considering the above factors, the directors have a reasonable expectation that the
Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

2. Adoption of New and Revised Standards

Standards not affecting the reported results nor the financial position:

The following new and
revised Standards and Interpretations have been adopted in the current period. Their adoption has not had any significant impact on the amounts reported in these financial statements but may impact the accounting for future transactions and
arrangements.



|                 |  |                                                                                            
|---------------- |  | -------------------------------------------------------------------------------------------
|IFRS 7 (amended) |  | Amendments enhancing disclosures about transfers of financial assets                       
|IFRS 1 (amended) |  | Additional exemption for entities ceasing to suffer from severe hyperinflation             
|IFRS 1 (amended) |  | Replacement of fixed dates for certain exceptions with the date 
of transition to IFRSs

IAS 1 requires a third comparative to be included within the consolidated balance sheet along with notes in the instance that any
previously reported financial information is restated or represented. In the current year, the Group changed its segments in accordance with IFRS 8 and this triggers this requirement. However, management have concluded that the addition of the 2010
comparative information would not provide the user of the consolidated financial statements with any additional helpful information or enhance the overall clarity of the consolidated financial statements, given a full explanation of the impact of
IFRS 8.



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Financial statements

Notes to the consolidated financial statements continued



At the date of authorisation of these financial statements, the following Standards and Interpretations which have not yet been applied in these financial statements were in issue but not yet effective (and in some
cases, had not yet been adopted by the EU):



|                                 |  |                                                                   
|-------------------------------- |  | ------------------------------------------------------------------
|IFRS 1 (amended)                 |  | First-time Adoption of International Financial Reporting Standards
|IFRS 7 (amended)                 |  | Financial Instruments (Disclosures)                               
|IFRS 9                           |  | Financial Instruments                                             
|IFRS 10                          |  | Consolidated Financial Statements                                 
|IFRS 11                          |  | Joint Arrangements                                                
|IFRS 12                          |  | Disclosure of Interests in Other Entities                         
|IFRS 13                          |  | Fair Value Measurement                                            
|IAS 1 (amended)                  |  | Presentation of Financial Statements                              
|IAS 12 (amended)                 |  | Income Taxes                                                      
|IAS 16 (amended)                 |  | Property, Plant and Equipment                                     
|IAS 19 (amended)                 |  | Employee benefits                                                 
|IAS 27 (amended)                 |  | Separate Financial Statements                                     
|IAS 28 (amended)                 |  | Investments in Associates and Joint Ventures                      
|IAS 32 (amended)                 |  | Offsetting financial assets and liabilities                       
|IAS 34 (amended)                 |  | Interim Financial Reporting                                       
|Improvements to IFRSs (May 2012) |  |                                                                   

The adoption of both IFRS 9 and IFRS 13 will impact both the measurements and disclosures of Financial Instruments.

The directors anticipate that the adoption of the other Standards and Interpretations listed above in future periods will have no material impact on the financial
statements of the Group.

3. Accounting Policies

Basis of Accounting

The financial statements have been prepared in accordance with International
Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB) and as adopted by the European Union (EU).

The
financial statements have been prepared on the historical cost basis, except for the revaluation of financial instruments. The principal accounting policies adopted are set out below. The financial statements cover the 52 week period from
31 December 2011 to 28 December 2012; the comparatives are presented for the 52 week period from 1 January 2011 to 30 December 2011 and income statement comparatives for the 52 week period from 2 January 2010 to
31 December 2010. The financial statements are reported on a 52 or 53 week basis to be consistent with the Groups internal reporting.

Basis of Consolidation

The consolidated financial statements incorporate the financial statements of
CSR plc (the Company) and entities controlled by the Company (its subsidiaries, together the Group) drawn up to the dates indicated in the primary financial statements. Control is achieved where the Company has the power to govern the financial and
operating policies of an investee entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the
year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the
accounting policies used into line with those used by the Group. All intra-Group transactions, balances, income and expenses are eliminated on consolidation.

Business Combinations

Acquisitions of subsidiaries and businesses are accounted for using the
acquisition method. The consideration for each acquisition is measured at the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for the
control of the acquiree. Acquisition-related costs are recognised in sales, general and administrative expenses as incurred for acquisitions that have occurred since the adoption of IFRS 3 (2008). Previous acquisitions have not been restated.

Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent consideration arrangement, measured
at its acquisition-date fair value. Subsequent changes in such fair values are adjusted against cost of acquisition where they qualify as measurement period adjustments (see below). All other subsequent changes in the fair value of contingent
consideration classified as an asset or liability are accounted for in accordance with relevant IFRSs. Changes in the fair value of contingent consideration classified in equity are not recognised.

The acquirees identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3 (2008) are recognised at
their fair value at the acquisition date, except that:



| |  | deferred tax assets and liabilities and liabilities or assets related to employee benefit arrangements are recognised and measured in accordance with IAS 12
Income taxes and IAS 19 Employee Benefits respectively;
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  | liabilities or equity instruments related to the replacement by the Group of an acquirees share-based payment awards are measured in accordance with IFRS 2
Share-based Payment; and
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations
are measured in accordance with that Standard.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If the initial accounting for a business combination is incomplete by the end of the
reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see below), or additional assets or
liabilities are recognised to reflect new information obtained about facts and circumstances that existed as at the acquisition date that, if known, would have affected the amounts recognised as of that date.

The measurement period is the period from the date of acquisition to the date the Group obtains complete information about facts and circumstances that existed as
of the acquisition date  and is subject to a maximum of one year.

Where there are acquiree share-based payment awards that will be exchanged for
awards held by the Group, the fair value of the outstanding awards is allocated between consideration and post-combination service.

The Group recognises
a contingent liability on the consolidated balance sheet as of the acquisition date if there is a present obligation that arises from past events and its fair value can be measured reliably.

Goodwill

Goodwill arising in a business combination is recognised as an asset at the date that
control is acquired (the acquisition date). Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of the Groups previously held equity
interest (if any) in the entity over the net of the acquisition-date amounts of identifiable assets acquired and the liabilities assumed.

If, after
reassessment, the Groups interest in the fair value of the acquirees identifiable net assets exceeds the sum of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of the
Groups previously held equity interest (if any), the excess is recognised in profit or loss as a bargain purchase gain.

For the purpose of
impairment testing, goodwill is allocated to each of the Groups cash-generating units expected to benefit from the combination. Cash-generating units to which goodwill has been allocated are tested annually or more frequently when there is an
indication that the unit may be impaired. To determine the recoverable amount of the cash-generating unit, the Group uses discounted projected cash flows based on approved budgets and projections covering a period up to five years and estimates
growth rates, terminal growth rates and discount rates specific to the economic environment within which the cash-generating unit is operating. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the
impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for
goodwill is not reversed in a subsequent period.

On disposal of part or whole of a CGU, the attributable amount is included in the determination of
profit or loss on disposal.

Revenue Recognition

Revenue is recognised when it is probable that economic benefits will flow to the Group and delivery has occurred or the service has been provided, the sales price is fixed or determinable, and collectability is
reasonably assured. These criteria are generally met at the time the product is shipped and delivered to the customer and, depending on the delivery conditions, title and risk have passed to the customer and acceptance of the product, when
contractually required, has been obtained, or, in cases where such acceptance is not contractually required, when management has established that all aforementioned conditions for revenue recognition have been met and no further post-shipment
obligations exist other than obligations under warranty. Examples of the above-mentioned delivery conditions are Free on Board point of delivery and Costs, Insurance Paid point of delivery, where the point of delivery may be
the shipping warehouse or any other point of destination as agreed in the contract with the customer and where title and risk in the goods pass to the customer.

Revenues are recorded net of sales taxes, customer discounts, rebates and similar charges. For products for which a right of return exists during a defined period, revenue recognition is determined based on the
historical pattern of actual returns, or in cases where such information is lacking, revenue recognition is postponed until the return period has lapsed. Return policies are typically based on customary return arrangements in local markets. Revenue
is shown net of estimated provision for credit notes and returns.

A provision for product warranty is made at the time of revenue recognition and
reflects the estimated costs of replacement and free of charge services that will be incurred by the Company with respect to the sold products.

Royalty
income, which is generally earned based upon a percentage of sales or a fixed amount per royalty earning product, is recognised upon shipment by the licencee as long as recovery is reasonably assured.

When a transaction requires the delivery of more than one product or service (multiple components), the revenue recognition criteria are applied to the separately
identifiable components. A component is considered to be separately identifiable if the product or service delivered has stand-alone value to that customer and the fair value associated with the product or service can be measured reliably. The
amount recognised as revenue for each component is the fair value of the element in relation to the fair value of the arrangement as a whole.

We
determine the fair value of our maintenance obligations with reference to substantive renewal rates within the agreement or objective evidence of fair value. In instances where we are unable to determine the fair value of our maintenance
obligations, revenue for the entire arrangement is recognised ratably over the term of the arrangement. We recognise maintenance and support revenue ratably over the term of the arrangement.



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Financial statements

Notes to the consolidated financial statements continued



Software license revenue is recognised fully upon delivery, where there is no obligation to provide ongoing technical support or software upgrades or enhancements. If technical support, software upgrades and
enhancements are sold with the software license, revenue will be recognised for each identified component based on the relative fair value of the delivered component for which consideration is received or receivable. With regards to technical
support, the revenue would be recognised ratably over the term of the arrangement.

Non-Recurring Engineering (NRE) revenue is recognised in line with
the stage of completion.

Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate
applicable.

Leasing

Leases are
classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets of the Group at their fair value or, if lower, at the present value of the minimum lease payments, each determined at the inception of the lease. The
corresponding liability to the lessor is included in the balance sheet as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the
remaining balance of the liability. Finance charges are charged directly to the income statement.

Rentals payable under operating leases are charged to
the income statement on a straight-line basis over the term of the relevant lease.

Benefits received and receivable as an incentive to enter into an
operating lease are also spread on a straight line basis over the lease term.

Foreign Currencies

The functional currency of all entities in the Group is the US dollar and this is also the presentation currency for the consolidated financial statements.
Transactions in currencies other than US dollars are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are
retranslated at the rates prevailing on the balance sheet date. Non-monetary assets and liabilities carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was
determined. Gains and losses arising on retranslation are included in the net profit or loss for the period except for exchange differences on transactions entered into to hedge certain foreign currency risks (see policy on Hedge Accounting).

In order to hedge its exposure to certain foreign exchange risks, the Group enters into forward contracts (see Financial Instruments policy for details
of the Groups accounting policies in respect of such derivative financial instruments).

On consolidation, the assets and liabilities of the
Groups overseas operations are translated at exchange rates prevailing on the balance sheet date. Income and expense items are translated at the average exchange rates for the period.

Government Grants

Government grants are not recognised until there is reasonable assurance the Group
will comply with the conditions attaching to them and that the grants will be received.

Government grants towards staff and marketing costs are
recognised as income over the periods necessary to match them with the related costs and are deducted in reporting the related expense.

Operating Result

Operating profit (loss) is stated
before investment income, exchange gains (losses), other gains and losses, finance costs and tax.

The income statement has been presented with certain
items split out as separate line items. Management believes that this presentation aids the understanding of the Groups financial performance and this presentation is used for internal performance evaluation. Items that have been split out on
the face of the income statement are the amortisation of acquired intangible assets, share-based payment charges under IFRS 2, charges associated with integration and restructuring, acquisition fees, charges relating to a fair value adjustment to
inventory, charges relating to patent settlements, the de-recognition of contingent consideration and litigation settlement income and charges.

Retirement Benefit Costs

The Group has both a defined contribution retirement scheme and a defined
benefit plan. The defined benefit plan represents severance payments required under Israeli law to employees who joined the Israeli subsidiary prior to 2007 who leave the Group involuntarily. These severance payments are funded by investment funds
held in the name of each employee, with the Company liable for meeting any shortfall. This meets the definition of a post employment defined benefit plan under IAS 19.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. Differences between contributions payable in the period and contributions actually paid are shown as either
accruals or prepayments in the Balance Sheet.



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Financial statements



An asset or liability is recognised in the Consolidated Balance Sheet in relation to
the defined benefit scheme, as the present value of the defined benefit obligation, less the fair value of plan assets at the Balance Sheet date. The financing cost, service cost and expected returns on plan assets are recognised within the Income
statement in the period in which they arise.

Actuarial gains and losses are recognised in full in the consolidated statement of comprehensive income in
the period in which they arise.

Where the carrying amount of scheme assets exceed the present value of the future benefits that are expected to flow to
the scheme from those assets (the asset ceiling), the surplus is recognised in full in the consolidated statement of comprehensive income in the period in which this arises.

Taxation

The tax expense represents the sum of the current tax expense and the deferred tax expense
for the period.

The tax payable is based on taxable profit for the period. Taxable profit differs from net profit before tax as reported in the income
statement because it excludes items of income and expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The Groups liability for current tax is calculated using tax rates
that have been enacted or substantively enacted by the balance sheet date.

Deferred tax is the tax expected to be payable or recoverable on differences
between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences, unused carried forward tax
losses and unused carried forward tax credits can be utilised. However, such assets and liabilities are not recognised if the temporary differences arise from:



| |  | the initial recognition of goodwill;
|- |  | ------------------------------------



| |  | the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the
accounting profit; or
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | investments in subsidiaries and associates, and interests in joint ventures, where the Group is able to control the reversal of the temporary difference and it
is probable that the temporary difference will not reverse in the foreseeable future.
|- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The carrying amount of deferred tax assets is
reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when
it relates to items charged or credited in other comprehensive income or directly to equity, in which case deferred tax is also dealt with in other comprehensive income or equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same
taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

Judgement is required when determining the
provision for taxes as the tax treatment of some transactions cannot be finally determined until a formal resolution has been reached with the tax authorities. Tax benefits are not recognised unless it is probable that the benefit will be obtained.
Tax provisions are made if it is probable that a liability will arise and the liability can be reliably measured. The Group reviews each significant tax liability or benefit to assess the appropriate accounting treatment.

Property, Plant and Equipment

Property, plant and
equipment are stated at cost less accumulated depreciation and any recognised impairment loss.

Depreciation is charged so as to write off the cost of
the assets, less estimated residual value, over their estimated useful lives, using the straight line method, on the following basis:



|                       |  |                                            
|---------------------- |  | -------------------------------------------
|Computer equipment     |  | 2 to 3 years                               
|Test equipment         |  | 2 to 5 years                               
|Office equipment       |  | 3 years                                    
|Furniture and fittings |  | 5 years                                    
|Leasehold improvements |  | Shorter useful life or minimum lease period

Residual values are the estimated amount that the Group would obtain from disposal of the asset, after deducting estimated costs of
disposal, if the asset were already of the age and in the condition expected at the end of its useful life, based on prices prevailing at the balance sheet date.

In general residual values are zero or negligible, due to the technical and specialised nature of assets held. Residual values are reviewed annually.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, over the term of the relevant lease.

The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset
and is recognised in the income statement.



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Financial statements

Notes to the consolidated financial statements continued



Other Intangible Assets

Other intangible fixed assets are stated at cost or fair value for items
acquired in business combinations, net of amortisation and any provision for impairment. No amortisation is provided on assets in the course of construction. On other intangible fixed assets, amortisation is provided at rates calculated to write off
the cost or fair value, less estimated residual value, of each asset on a straight line basis over its expected useful life as follows:



|                                            |  |                                                       
|------------------------------------------- |  | ------------------------------------------------------
|Software licences and intellectual property |  | Licence term or 3 to 5 years where a perpetual licence
|Customer contracts and relationships        |  | 3 to 4 years                                          
|Purchased IPR&D                             |  | 4 to 10 years                                         
|Internally developed technology             |  | 3 years                                               
|Purchased developed technology              |  | 3 to 4 years                                          
|Trade names                                 |  | 2 to 5 years                                          

Residual values are the estimated amount that the Group would obtain from disposal of the asset, after deducting estimated costs of
disposal, if the asset were already of the age and in the condition expected at the end of its useful life, based on prices prevailing at the balance sheet date.

In general residual values are zero or negligible, due to the technical and specialised nature of assets held. Residual values are reviewed annually.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, over the term of the relevant lease.

The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset
and is recognised in the income statement.

Assets in the course of construction are carried at cost net of any provision for impairment. Costs included
are those that directly relate to the construction or production of the asset. Amortisation of these assets commences when the assets are ready for their intended use.

Research and Development Expenditure

Expenditure on research activities is recognised as an expense
in the period in which it is incurred.

An internally generated intangible asset arising from the Groups product development is recognised only if
all of the following conditions are met:



| |  | an asset is created that can be identified (such as a new device or software);
|- |  | ------------------------------------------------------------------------------



| |  | the project from which the asset arises meets the Groups criteria for assessing technical feasibility;
|- |  | -------------------------------------------------------------------------------------------------------



| |  | it is probable that the asset created will generate future economic benefits; and
|- |  | ---------------------------------------------------------------------------------



| |  | the development cost of the asset can be measured reliably.
|- |  | -----------------------------------------------------------

Internally generated intangible assets are amortised on a straight line basis over their useful lives. Where no internally generated intangible asset can be recognised, development expenditure is recognised as an
expense in the period in which it is incurred.

Impairment of Tangible and Intangible Assets Excluding Goodwill

At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those
assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are
independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. An intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an
indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in
use, the estimated future cash flows are discounted to their present values using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash
flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately. After the recognition of an impairment loss, any depreciation or amortisation charge for the asset
is adjusted for future periods to allocate the assets revised carrying value, less estimated residual value, on a systematic basis, over its remaining useful life.

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but the reversal is limited so that the
increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised as income
immediately.



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Inventories

Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, those overheads that have been incurred in bringing the inventories to their present
location and condition. Cost is calculated using the first-in-first-out (FIFO) method. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and
distribution.

Financial Instruments

Financial assets and financial liabilities are recognised on the Groups balance sheet when the Group becomes a party to the contractual provisions of the
instrument.

Loans and Receivables

Trade
receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are measured at amortised cost using the effective interest
method, less any impairment or appropriate allowances for estimated irrecoverable amounts. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.

Treasury deposits and investments

Treasury deposits and investments are recognised and derecognised on a trade date where a purchase or sale of an investment is under a contract whose terms require
delivery of the investment within the timeframe established by the market concerned, and are initially measured at cost, including transaction costs.

Treasury deposits and investments consist of money market deposits in USD, GBP and obligations of the United States government treasury with original maturities of
over ninety days. Interest income is recorded as it accrues over the period of the investment at rates fixed at the time of inception.

Cash and Cash Equivalents

Cash and cash equivalents
comprise cash on hand and demand deposits and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.

Financial Assets at FVTPL (Fair Value Through Profit and Loss)

Financial Assets are classified as FVTPL where the asset has been designated as FVTPL.

A financial asset may be
designated as FVTPL upon initial recognition if:



| |  | such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or
|- |  | ------------------------------------------------------------------------------------------------------------------------------



| |  | the financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its performance evaluated on a fair value
basis, in accordance with the Groups documented risk management or investment strategy, and information about the Group is provided internally on that basis; or
|- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | it forms part of a contract containing one or more embedded derivatives, and IAS 39 Financial Instruments: Recognition and Measurement permits the entire
combined contract (asset or liability) to be designated FVTPL.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Financial assets at FVTPL are stated at fair value, with any resultant
gain or loss recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any dividend or interest earned on the financial asset and is included in the other gains and losses line in the income statement.
Fair value is determined in the manner described in note 36.

Available for sale financial assets

The Group has investments in unlisted shares that are not traded in an active market but are classified as AFS financial assets and stated at fair value (because
the directors consider that fair value can be reliably measured). Fair value is determined in the manner described in note 36. Gains and losses arising from changes in fair value are recognised in other comprehensive income and accumulated in the
investments revaluation reserve with the exception of impairment losses, which are recognised directly in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in the
investments revaluation reserve is reclassified into profit or loss.

Derecognition of Financial Assets

The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire; or it transfers the financial asset and
substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises
its retained interest in the asset and an associated liability for amounts it may have to pay.

Impairment of Financial Assets

Financial assets, other than those held at FVTPL, are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired
when there is objective evidence that, as a result of one or more events that have occurred after the initial recognition of the asset, the estimated future cash flows of the investment have been impaired. Objective evidence of impairment could
include significant financial difficulty of the issuer or the counterparty; or default or delinquency in interest or principal payments; or it becoming probable that the borrower will enter bankruptcy or financial re-organisation.

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables where the
carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account.

Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss.

Financial Liabilities and Equity

Financial
liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into.



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Notes to the consolidated financial statements continued



Trade Payables

Trade payables are obligations to pay for goods or services that have been acquired in
the ordinary course of business from suppliers. Trade payables are not interest bearing and are initially measured at fair value, net of transaction cost.

Subsequently these are measured at amortised cost using the effective interest method, with interest recognised on an effective yield basis.

Equity Instruments

An equity instrument is any
contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equity instruments issued by the Group are recorded at the proceeds received, net of direct issue costs.

Financial Liabilities at FVTPL (Fair Value Through Profit and Loss)

Financial liabilities are classified as FVTPL where the financial liability has been designated as FVTPL.

A financial
liability may be designated as FVTPL upon initial recognition if:



| |  | such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or
|- |  | ------------------------------------------------------------------------------------------------------------------------------



| |  | the financial liability forms part of a group of financial assets or financial liabilities or both, which is managed and its performance evaluated on a fair
value basis, in accordance with the Groups documented risk management or investment strategy, and information about the Group is provided internally on that basis; or
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  | it forms part of a contract containing one or more embedded derivatives, and IAS 39 Financial Instruments: Recognition and Measurement permits the entire
combined contract (asset or liability) to be designated FVTPL.
|- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Derecognition of Financial Liabilities

The Group derecognises financial liabilities when, and only when, the Groups obligations are discharged, cancelled or they expire.

Derivative Financial Instruments

The Groups
activities expose it to the financial risks of changes in foreign currency exchange rates. The Group uses foreign exchange forward contracts to hedge these exposures. The Group does not use derivative financial instruments for speculative purposes.
Further details of derivative financial instruments are disclosed in note 36 to the financial statements.

The use of financial derivatives is governed
by the Groups policies approved by the Board of directors, which provides written principles on the use of financial derivatives. The Groups policy is to hedge between 75% and 90% of forecast GBP expenditure for the following 11 to 15
months.

Derivative financial instruments are initially recorded at fair value at the date a derivative contract is entered into and are subsequently
remeasured to fair value at each balance sheet date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in
profit or loss depends on the nature of the hedge relationship.

Hedge Accounting

Hedges of foreign exchange risk on firm commitments are accounted for as cash flow hedges.

At the inception of the hedge relationship, the Group documents the relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking
various hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Group documents whether the hedging instrument that is used in a hedging relationship is highly effective in offsetting changes in cash flows of the
hedged item.

Note 23 sets out details of the fair values of the derivative instruments used for hedging purposes.

Movements in the hedging reserve in equity are also detailed in the statement of changes in equity.

Cash Flow Hedges

The effective portion of changes in the fair value of derivatives that are
designated and qualify as cash flow hedges are deferred in equity. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss.

Amounts deferred in equity are recycled into profit or loss in the periods when the hedged item is recognised in profit or loss. When the forecast transaction that is hedged results in the recognition of a
non-financial asset or a non-financial liability, the gains and losses previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset or liability.

Hedge accounting is discontinued when the Group revokes the hedging relationship, the hedging instrument expires or is sold, terminated, exercised or no longer
qualifies for hedge accounting. Any cumulative gain or loss deferred in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer
expected to occur, the cumulative gain or loss that was deferred in equity is recognised immediately in profit or loss.

Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group
will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.



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Financial statements



Provisions for warranty and returns costs are recognised at the date of sale of the
relevant products, at the directors best estimate of the expenditure required to settle the Groups liability.

Provision is made for onerous
contracts at the fair value of the minimum unavoidable payments, net of any amounts recoverable. Where amounts are known and timings certain, onerous amounts are accrued instead.

A restructuring provision is recognised when the Group has developed a detailed formal plan for the restructuring and has raised a valid expectation in those affected that it will carry out the restructuring by
starting to implement the plan or announcing its main features to those affected by it. The measurement of a restructuring provision includes only the direct expenditures arising from the restructuring, which are those amounts that are both
necessarily entailed by the restructuring and not associated with the ongoing activities of the entity.

Share-Based Payment

The Group issues equity-settled share-based payments to certain employees, including share options with non-market based vesting conditions. Equity settled
share-based payments are measured at the fair value at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Groups
estimate of shares that will eventually vest.

For grants where options vest in instalments over the vesting period, each instalment is treated as a
separate grant, which results in fair value of each instalment being spread across the vesting period of that instalment.

Fair value is measured by use
of a Black-Scholes model for most of share options in issue. The expected life used in the model has been adjusted, based on managements best estimate, for the effects of non-transferability, exercise restrictions, and behavioural
considerations.

For certain share options which include Total Shareholder Return (TSR) related conditions the fair value is estimated through the use of
a Monte-Carlo simulation.

Save-As-You-Earn SAYE share options granted to employees are treated as cancelled when employees cease to
contribute to the scheme. This results in accelerated recognition of the expenses that would have arisen over the remainder of the original vesting period.

For a business combination where there are acquiree share-based payment awards that will be exchanged for awards held by the Group, the fair value of the outstanding awards is allocated between consideration and
post-combination service in accordance with IFRS 3 (2008) using the valuation techniques described in IFRS 2. The allocation of the fair value of the options outstanding to consideration results in a credit to equity in the share-based payment
reserve.

For cash-settled share-based payments, the Group recognises a liability for the goods or services acquired, measured initially at the fair
value of the liability. At each balance sheet date until the liability is settled, and at the date of settlement, the fair value of the liability is re-measured, with any changes in fair value recognised in profit or loss for the period.

Employee Benefit Trust

The Group has established an
employee benefit trust which is a separately administered trust and is funded by loans from Group companies. The assets of the trust comprise shares in CSR plc and cash balances. The Group recognises assets and liabilities of the trust in the
consolidated accounts and shares held by the trust are recorded at cost as a deduction from shareholders equity.

Contingent
liabilities and assets

A contingent liability may arise where there is possible obligation that arises from past events, whose occurrence or
non-occurrence will only be confirmed by uncertain future events or where a present obligation arises from past events but where an outflow of resources from the Group is not probable and/or the amount of the obligation cannot be reliably measured.
In these circumstances, the Group discloses the nature of such contingent liabilities. The Group recognises liabilities where there is a present obligation and an outflow of resources from the Group is probable and can be reliably measured.

A contingent asset may arise where, as a result of past events, there is a possible asset which will only be confirmed by the occurrence or
non-occurrence of one or more uncertain future events which are not entirely within the control of the Group. In these circumstances, the Group discloses the nature of such contingent assets. The Group recognises an asset when an inflow of economic
benefits is recognised as virtually certain.

Treasury shares

The Group holds shares in its own equity that it has reacquired as part of a share buy-back programme. The shares are shown as a deduction in equity and are measured at the fair value of the shares purchased and
transaction costs.

Dividend distribution

A dividend distribution to the Companys shareholders is recognised as a liability in the Groups financial statements in the period in which the
dividends are committed to be paid. In the case of a final dividend distribution, this will also be the period in which the dividends are approved by the Companys shareholders. Interim dividends are recorded in the period in which they are
approved and paid.

4. Critical Accounting Judgements and Key Sources of Estimation and Uncertainty

These consolidated financial statements have been prepared in accordance with IFRS as issued by the IASB and as adopted by the European Union (EU).

The preparation of financial statements requires the directors to make estimates and assumptions about future events that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities.

Future events and their effects cannot be determined with absolute certainty.
Therefore, the determination of estimates requires the exercise of judgement based on various assumptions and other factors such as historical experience, current and expected economic conditions. The directors constantly re-evaluate these
significant factors and make adjustments where facts and



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Financial statements

Notes to the consolidated financial statements continued



circumstances dictate. The directors believe that the following accounting policies are critical due to the degree of estimation required and / or the potential material impact they may have on
the Groups financial position and performance.

Inventory Valuation

The level of inventory provisioning required is sensitive to changes in the forecast sales of particular products which is dependent on changes in conditions in the Groups markets. If changes in actual market
conditions are less favourable than those projected, additional inventory provisions may be required; similarly if changes in actual market conditions are more favourable than predicted, the Group may be able to release a proportion of the inventory
provision.

Business Combinations and Goodwill Impairments

The amount of goodwill initially recognised as a result of a business combination is dependent on the allocation of the purchase price to the fair value of the identifiable assets acquired and the contingent
liabilities assumed. The Group uses judgement, estimates and involves external specialists in determining the fair value of identifiable assets and liabilities acquired in a business combination, as well as calculating the fair value of the purchase
consideration on acquisition.

Allocation of the purchase price affects the results of the Group as finite lived intangible assets are amortised, whereas
indefinite lived intangible assets, including goodwill, are not amortised and could result in differing amortisation charges based on the allocation to indefinite lived and finite lived intangible assets.

The Group assesses the carrying value of identifiable intangible assets, long-lived assets and goodwill annually, or more frequently if events or changes in
circumstances indicate that such carrying value may not be recoverable. Factors considered important, which could trigger an impairment review, include the following:



| |  | significant under performance relative to historical or projected future results;
|- |  | ---------------------------------------------------------------------------------



| |  | significant changes in the manner of our use of the acquired assets or the strategy for our overall business;
|- |  | -------------------------------------------------------------------------------------------------------------



| |  | Group market capitalisation being less than the carrying value of net assets; and
|- |  | ---------------------------------------------------------------------------------



| |  | significantly negative industry or economic trends.
|- |  | ---------------------------------------------------

The recoverable amounts of the Groups CGUs are determined from value in use calculations based upon cash flow forecasts derived from the most recent financial budget approved by management and the Board of
Directors for the next year and longer range financial plans covering the subsequent four years that have been reviewed and approved by management and the Board of Directors. The key assumptions for the value in use calculations are those regarding
the growth in future sales, projected production costs, operating expenditures, the discount rates and terminal growth rates.

The Group determines
discount rates to be used based on the risk inherent in the related activitys current business model and industry comparisons, where these risks cannot be reflected in cashflows. Terminal values are based on the forecasted cash flows in the
final year of the five year long range plan. While the Group believes that its assumptions are appropriate, such amounts estimated could differ materially from what will actually occur in the future. In assessing goodwill, these discounted cash
flows are prepared at a cash-generating unit level.

Note 16 to the financial statements provides further disclosures on the assumptions underlying the
impairment review and the allocation of goodwill by reportable segments.

Accounting for Share-based Payments

The fair value of some of the options granted is measured by use of a Black-Scholes model, taking into account the terms and conditions upon which the options were
granted. The expected life used in the model has been adjusted, based on managements best estimate for the effects of non-transferability, exercise restrictions and, behavioural considerations. The volatility used in the model is based on
movements in the Groups share price for a period matching that of the vesting period of the options. The risk-free interest rate used is the implied yield currently available on zero-coupon government issues in the UK, with a remaining term
equal to the expected term of the option being valued (based on the options remaining contractual life and taking into account the effects of expected early exercise).

Non-market vesting conditions are included in assumptions about the number of shares that are expected to become exercisable. The estimates of the number of share options and awards that are expected to become
exercisable are reviewed at each balance sheet date. The impact of the revision of original estimates, if any, is recognised in the income statement and a corresponding adjustment to equity. Where there are indicators that there have been changes to
non-market vesting conditions, subsequent to the grant date, the amount recognised as an expense is adjusted to reflect the actual number of shares that vest.

Revenue recognition

Sales are recognised when the significant risks and rewards of ownership have
transferred to the buyer, continuing managerial involvement usually associated with ownership and effective control have ceased, the amount of revenue can be measured reliably, it is probable that economic benefits associated with the transaction
will flow to the Group and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

This requires the Group to
assess at the point of delivery whether these criteria have been met. When the Group determines that such criteria have been met, revenue is recognised. The Group records estimated reductions to revenue for pricing agreements, price protection,
other volume based rebates and expected returns. Estimated sales adjustments for volume based discount programs are based largely on shipment information.



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Financial statements



Income Taxes

The Group is subject to the income tax laws of the various tax jurisdictions in which we operate, principally the United Kingdom. These laws are complex and subject to different interpretations by taxpayers and tax
authorities. When establishing income tax provisions, we therefore make a number of judgments and interpretations about the application and interaction of these laws. Changes in these tax laws or our interpretations of these laws and the resolution
of future tax audits could significantly impact our effective tax rate and the results of operations in a given period.

Where it is probable that a
position may be successfully challenged by revenue authorities, a tax provision is created for the tax on the probable adjustment.

The Group estimates
its income taxes in each of the jurisdictions in which it operates. This process involves estimating its current tax liability together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes.
These differences result in the recognition of deferred tax assets and liabilities, which are included within the consolidated balance sheet to the extent that we believe they are recoverable.

Managements judgement is required in determining the provision for income taxes, deferred tax assets and liabilities. Deferred tax assets have been recognised where management believes there are sufficient
taxable temporary differences or it is probable that sufficient taxable profit will be available in future to realise deferred tax assets.

Although the
deferred tax assets which have been recognised are considered realisable, actual amounts could be reduced if future taxable income is lower than expected. This could materially affect the Groups reported net income and financial position.

Litigation and claims

The Group may be
subject to claims, legal actions and complaints, including patent infringements, arising in the normal course of business. The likelihood and ultimate outcome of such occurrences is not presently determinable therefore the Group uses estimation and
judgement on whether any of these claims or litigation should result in a liability being recognised.

Issues can, and do, take many years to resolve.
Significant items of litigation and claims on which the Group has exercised accounting judgement in respect of whether or not to recognise a contingent liability are discussed in note 31. The inherent uncertainty regarding the outcome of these items
means eventual resolution could differ from the accounting estimates and therefore impact the Groups results and cash flows.

5.
Revenue



|                            |  |                                     |           |  |                                     |  |         |                                     |  |  |         | 
|--------------------------- |  | ----------------------------------- | --------- |  | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | 
|                            |  | 52 weeks ended28 December 2012$000 |           |  | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|Sale of integrated circuits |  |                                     | 964,774   |  |                                     |  | 808,463 |                                     |  |  | 782,332 | 
|Sale of software            |  |                                     | 8,142     |  |                                     |  | 7,953   |                                     |  |  | 10,444  | 
|Royalties                   |  |                                     | 52,440    |  |                                     |  | 28,774  |                                     |  |  | 7,832   | 
|                            |  |                                     | 1,025,356 |  |                                     |  | 845,190 |                                     |  |  | 800,608 | 
|Investment income           |  |                                     | 1,161     |  |                                     |  | 1,627   |                                     |  |  | 812     | 
|                            |  |                                     | 1,026,517 |  |                                     |  | 846,817 |                                     |  |  | 801,420 | 

6. Segmental Reporting

CSR is a leading provider of platform technology solutions for the consumer electronics market.

Products from which Reportable Segments Derive their Revenues

During the year the internal reporting structures of the Group were reorganised changing the nature and content of information used by the Chief Executive, who is our Chief operating decision maker, to assess
operational performance and allocate resource; this has caused a change in the identification of Operating Segments as defined under IFRS 8. In our opinion each operating segment is a reporting segment, therefore the results of the new
Operating Segments are Voice & Music, Consumer, Automotive and Legacy are reported below; results from 2011 and 2010 have been restated into this new structure.

The Group reportable segments under IFRS 8 Operating Segments are as follows:



|                            |  |                                                                                                    
|--------------------------- |  | ---------------------------------------------------------------------------------------------------
|Voice & Music               |  | Mono and Stereo Audio                                                                              
|Automotive                  |  | Automotive and Personal Navigation Device (PND) applications                                       
|Consumer                    |  | Cameras, Gaming, Document Imaging, Indoors Location, BluetoothSmart and other consumer.applications
|Legacy Products Group (LPG) |  | Legacy Home Entertainment, Handset Connectivity and HandsetLocation (components)                   



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Financial statements

Notes to the consolidated financial statements continued



Segment Revenues and Results

The following is an analysis of the Groups revenue and results by
reportable segment:



|                                             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  |           |  
|-------------------------------------------- |  | --------------- | ------- |  | ------------- |  | ------- | ----------------- |  |  | -------- |  |  | ---------------- | ------- |  | ----------------- |  | ------- | - |  |  | --------- | -
|52 weeks ended 28 December 2012              |  | Automotive$000 |         |  | Consumer$000 |  |         | Voice &Music$000 |  |  | LPG$000 |  |  | Unallocated$000 |         |  | Consolidated$000 | 
|Revenue                                      |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  |           |  
|Total segment revenue                        |  |                 | 212,178 |  |               |  | 258,732 |                   |  |  | 190,119  |  |  |                  | 364,327 |  |                   |  |        |   |  |  | 1,025,356 |  
|Segment result                               |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  |           |  
|Underlying operating profit (loss)           |  |                 | 3,245   |  |               |  | (15,643 | )                 |  |  | 75,115   |  |  |                  | 11,312  |  |                   |  |        |   |  |  | 74,029    |  
|Share-based payment charges                  |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  | (27,753 | ) |  |  | (27,753   | )
|Amortisation of acquired intangible assets   |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  | (22,732 | ) |  |  | (22,732   | )
|Integration and restructuring                |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  | (27,523 | ) |  |  | (27,523   | )
|Litigation and patent settlement charges     |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  | (15,500 | ) |  |  | (15,500   | )
|Other operating income                       |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  | 214     |   |  |  | 214       |  
|Disposal of development operations (note 38) |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  | 127,178 |   |  |  | 127,178   |  
|Operating profit                             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  | 107,913   |  
|Investment income (note 5)                   |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  | 1,161     |  
|Other gains and losses (note 11)             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  | 14        |  
|Exchange losses                              |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  | (395      | )
|Finance costs (note 12)                      |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  | (6,711    | )
|Profit before tax                            |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |  |                   |  |         |   |  |  | 101,982   |  

The Group discloses underlying operating profit as the performance measure of segment result as this is the measure used in the
decision-making and resource allocation process of the Chief Operating Decision Maker, which is the Groups Chief Executive Officer.

Investment
income and finance costs are not allocated to reportable segments for the purposes of reporting to the Groups Chief Executive Officer.

There is no
intra-segment revenue.

The accounting policies for the reportable segments are the same as the Groups accounting policies.

Segment underlying operating profit represents operating profit earned by each segment without allocation, in each period, of acquisition-related fees, share-based
payment charges, litigation and patent settlements, integration and restructuring charges, charges related to the amortisation of acquired intangible assets, charges related to the fair value adjustment to inventory and the de-recognition of
contingent consideration.

The following is an analysis of the Groups revenue and results by reportable segment:



|                                           |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  |         |  
|------------------------------------------ |  | --------------- | ------- |  | ------------- |  | ------- | ----------------- |  |  | -------- |  |  | ---------------- | ------- | - | ----------------- |  | ------- | - |  |  | ------- | -
|52 weeks ended 30 December 2011            |  | Automotive$000 |         |  | Consumer$000 |  |         | Voice &Music$000 |  |  | LPG$000 |  |  | Unallocated$000 |         |   | Consolidated$000 | 
|Revenue                                    |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  |         |  
|Total segment revenue                      |  |                 | 205,045 |  |               |  | 165,555 |                   |  |  | 149,853  |  |  |                  | 324,737 |   |                   |  |        |   |  |  | 845,190 |  
|Segment result                             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  |         |  
|Underlying operating profit (loss)         |  |                 | 10,625  |  |               |  | (7,999  | )                 |  |  | 59,496   |  |  |                  | (12,916 | ) |                   |  |        |   |  |  | 49,206  |  
|Fair value adjustment to inventory         |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (28,187 | ) |  |  | (28,187 | )
|Share-based payment charges                |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (14,130 | ) |  |  | (14,130 | )
|Amortisation of acquired intangible assets |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (18,681 | ) |  |  | (18,681 | )
|Integration and restructuring              |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (33,721 | ) |  |  | (33,721 | )
|Acquisition-related fees                   |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (13,004 | ) |  |  | (13,004 | )
|Litigation settlement                      |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | 14,532  |   |  |  | 14,532  |  
|Patent settlements                         |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (6,000  | ) |  |  | (6,000  | )
|De-recognition of contingent consideration |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | 1,620   |   |  |  | 1,620   |  
|Operating loss                             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (48,365 | )
|Investment income (note 5)                 |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | 1,627   |  
|Other gains and losses (note 11)           |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | 320     |  
|Exchange losses                            |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (748    | )
|Finance costs (note 12)                    |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (4,298  | )
|Loss before tax                            |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (51,464 | )



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##### Table of Contents

Financial statements



The following is an analysis of the Groups revenue and results by reportable
segment in the 52 weeks ended 31 December 2010.



|                                           |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  |         |  
|------------------------------------------ |  | --------------- | ------- |  | ------------- |  | ------- | ----------------- |  |  | -------- |  |  | ---------------- | ------- | - | ----------------- |  | ------- | - |  |  | ------- | -
|52 weeks ended 31 December 2010            |  | Automotive$000 |         |  | Consumer$000 |  |         | Voice &Music$000 |  |  | LPG$000 |  |  | Unallocated$000 |         |   | Consolidated$000 | 
|                                           |  |                 |         |  |               | 
|Revenue                                    |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  |         |  
|Total segment revenue                      |  |                 | 223,071 |  |               |  | 100,124 |                   |  |  | 138,264  |  |  |                  | 339,149 |   |                   |  |        |   |  |  | 800,608 |  
|Segment result                             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  |         |  
|Underlying operating profit                |  |                 | 44,819  |  |               |  | 9,442   |                   |  |  | 47,874   |  |  |                  | (23,159 | ) |                   |  |        |   |  |  | 78,976  |  
|Share-based payment charges                |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (9,822  | ) |  |  | (9,822  | )
|Amortisation of acquired intangible assets |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (14,137 | ) |  |  | (14,137 | )
|Integration and restructuring              |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (1,085  | ) |  |  | (1,085  | )
|Acquisition-related fees                   |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (397    | ) |  |  | (397    | )
|Litigation settlement                      |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  | (59,788 | ) |  |  | (59,788 | )
|Operating loss                             |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (6,253  | )
|Investment income (note 5)                 |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | 812     |  
|Other gains and losses (note 11)           |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | 640     |  
|Exchange losses                            |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (186    | )
|Finance costs (note 12)                    |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (718    | )
|Loss before tax                            |  |                 |         |  |               |  |         |                   |  |  |          |  |  |                  |         |   |                   |  |         |   |  |  | (5,705  | )

Underlying operating profit includes depreciation and amortisation of other intangible assets, which have been apportioned to the
reportable segments as follows:



|                                                         |  |                 |       |  |               |  |       |                   |  |  |          |  |  |            |        |  |  |  |        | 
|-------------------------------------------------------- |  | --------------- | ----- |  | ------------- |  | ----- | ----------------- |  |  | -------- |  |  | ---------- | ------ |  |  |  | ------ | 
|Depreciation and amortisation of other intangible assets |  | Automotive$000 |       |  | Consumer$000 |  |       | Voice &Music$000 |  |  | LPG$000 |  |  | Total$000 |       
|52 weeks ended 28 December 2012                          |  |                 | 4,950 |  |               |  | 6,036 |                   |  |  | 4,436    |  |  |            | 8,502  |  |  |  | 23,924 | 
|52 weeks ended 30 December 2011                          |  |                 | 6,318 |  |               |  | 5,101 |                   |  |  | 4,617    |  |  |            | 10,007 |  |  |  | 26,043 | 
|52 weeks ended 31 December 2010                          |  |                 | 6,689 |  |               |  | 3,003 |                   |  |  | 4,146    |  |  |            | 10,170 |  |  |  | 24,008 | 

No information is provided for segment assets and liabilities as these measures are not provided to the chief operating decision
maker.

Revenues from Major Products

The
Groups revenues from its major products were as follows:



|                                                   |  |                                     |           |  |                                     |  |         |                                     |  |  |         | 
|-------------------------------------------------- |  | ----------------------------------- | --------- |  | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | 
|                                                   |  | 52 weeks ended28 December 2012$000 |           |  | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|Sale of integrated circuits                        |  |                                     | 964,774   |  |                                     |  | 808,463 |                                     |  |  | 782,332 | 
|Sale of software                                   |  |                                     | 8,142     |  |                                     |  | 7,953   |                                     |  |  | 10,444  | 
|Royalties                                          |  |                                     | 52,440    |  |                                     |  | 28,774  |                                     |  |  | 7,832   | 
|Consolidated revenue (excluding investment income) |  |                                     | 1,025,356 |  |                                     |  | 845,190 |                                     |  |  | 800,608 | 

Geographical Information

The Group operates in four principal geographical areas  the UK (country of domicile), Rest of Europe, the Americas and Asia. The Groups revenue from external customers and information about its segment
assets (non-current assets excluding deferred tax assets and other financial assets) by geographical location is detailed below:



|                             |  |                                     |           |  |                                     |  |         |                                     |  |  |         | 
|---------------------------- |  | ----------------------------------- | --------- |  | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | 
|Revenue                      |  | 52 weeks ended28 December 2012$000 |           |  | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|UK                           |  |                                     | 156       |  |                                     |  | 185     |                                     |  |  | 6,655   | 
|Rest of Europe               |  |                                     | 39,057    |  |                                     |  | 60,508  |                                     |  |  | 110,171 | 
|USA (including the Americas) |  |                                     | 82,969    |  |                                     |  | 89,498  |                                     |  |  | 92,316  | 
|Asia                         |  |                                     | 903,174   |  |                                     |  | 694,999 |                                     |  |  | 591,466 | 
|                             |  |                                     | 1,025,356 |  |                                     |  | 845,190 |                                     |  |  | 800,608 | 

Revenues are attributed to geographical areas on the basis of the customers manufacturing location.



|                             |  |                       |         |  |                       |  |         |                       |  |  |         | 
|---------------------------- |  | --------------------- | ------- |  | --------------------- |  | ------- | --------------------- |  |  | ------- | 
|Non  current assets         |  | 28 December 2012$000 |         |  | 30 December 2011$000 |  |         | 31 December 2010$000 | 
|UK                           |  |                       | 160,175 |  |                       |  | 267,753 |                       |  |  | 276,829 | 
|Rest of Europe               |  |                       | 632     |  |                       |  | 1,674   |                       |  |  | 614     | 
|USA (including the Americas) |  |                       | 107,652 |  |                       |  | 142,860 |                       |  |  | 4,460   | 
|Asia                         |  |                       | 95,159  |  |                       |  | 86,339  |                       |  |  | 8,172   | 
|                             |  |                       | 363,618 |  |                       |  | 498,626 |                       |  |  | 290,075 | 

Non-current assets, being goodwill, property, plant and equipment, long term assets, and other intangible assets (excluding deferred
tax assets) are attributed to the location where they are situated.



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##### Table of Contents

Financial statements

Notes to the consolidated financial statements continued



Information About Major Customers

In 2012, included in revenues arising from Consumer and LPG are
revenues of approximately $113.9 million (2011: $87.3 million, 2010: $115.2 million), representing 11% (2011: 10%, 2010: 14%) of revenue relating to the Groups largest customer.

In 2012, 2011 and 2010 only the largest customer of the Group exceeded 10% of revenue in the 52 week period.

Revenue
from the top five customers represents 30% of revenues (2011: 38%; 2010: 42%).

7. Profit for the Period

Profit for the period has been arrived at after charging (crediting):



|                                                                                            |  |                                     |         |   |                                     |  |         |                                     |  |  |         |  
|------------------------------------------------------------------------------------------- |  | ----------------------------------- | ------- | - | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | -
|                                                                                            |  | 52 weeks ended28 December 2012$000 |         |   | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|Net foreign exchange losses                                                                 |  |                                     | 1,638   |   |                                     |  | 2,799   |                                     |  |  | 2,485   |  
|Government grants towards staff and marketing costs                                         |  |                                     | (671    | ) |                                     |  | (9      | )                                   |  |  | (142    | )
|Research and development costs                                                              |  |                                     | 290,346 |   |                                     |  | 241,763 |                                     |  |  | 199,927 |  
|Depreciation of property, plant and equipment                                               |  |                                     | 16,171  |   |                                     |  | 18,371  |                                     |  |  | 20,091  |  
|Loss on disposal of property, plant and equipment                                           |  |                                     | 916     |   |                                     |  | 62      |                                     |  |  | 580     |  
|Loss on disposal of intangible assets                                                       |  |                                     |        |   |                                     |  | 23      |                                     |  |  | 135     |  
|Amortisation of intangible assets                                                           |  |                                     | 30,485  |   |                                     |  | 26,353  |                                     |  |  | 18,054  |  
|Staff costs (see note 9)                                                                    |  |                                     | 314,055 |   |                                     |  | 228,369 |                                     |  |  | 170,791 |  
|Cost of inventories recognised as expense                                                   |  |                                     | 468,500 |   |                                     |  | 394,618 |                                     |  |  | 397,971 |  
|Write-downs of inventories recognised as an expense net of movement in inventory provisions |  |                                     | (2,267  | ) |                                     |  | 9,086   |                                     |  |  | 2,474   |  
|Auditors remuneration for audit services (see note 8)                                      |  |                                     | 993     |   |                                     |  | 1,051   |                                     |  |  | 789     |  

8. Auditors remuneration



|                                                                                           |  |                                     |       |  |                                     |  |       |                                     |  |  |     | 
|------------------------------------------------------------------------------------------ |  | ----------------------------------- | ----- |  | ----------------------------------- |  | ----- | ----------------------------------- |  |  | --- | 
|                                                                                           |  | 52 weeks ended28 December 2012$000 |       |  | 52 weeks ended30 December 2011$000 |  |       | 52 weeks ended31 December 2010$000 | 
|Fees payable to the Companys auditor for the audit of the Companys annual accounts       |  |                                     | 68    |  |                                     |  | 85    |                                     |  |  | 78  | 
|Fees payable to the Companys auditor and their associates for other services to the Group |  |                                     |       |  |                                     |  |       |                                     |  |  |     | 
| The audit of the Companys subsidiaries pursuant to legislation                          |  |                                     | 678   |  |                                     |  | 788   |                                     |  |  | 505 | 
| Services pursuant to section 404 of the Sarbanes-Oxley Act                               |  |                                     | 137   |  |                                     |  | 134   |                                     |  |  | 162 | 
|Total audit fees                                                                           |  |                                     | 883   |  |                                     |  | 1,007 |                                     |  |  | 745 | 
|Other services                                                                             |  |                                     |       |  |                                     |  |       |                                     |  |  |     | 
| Audit related assurance                                                                  |  |                                     | 110   |  |                                     |  | 44    |                                     |  |  | 44  | 
| Taxation compliance services                                                             |  |                                     | 157   |  |                                     |  | 42    |                                     |  |  | 47  | 
| Other taxation advisory services                                                         |  |                                     | 515   |  |                                     |  | 424   |                                     |  |  | 347 | 
| Other assurance services                                                                 |  |                                     |      |  |                                     |  | 284   |                                     |  |  |    | 
| Corporate finance services                                                               |  |                                     | 350   |  |                                     |  | 2,096 |                                     |  |  |    | 
|Total non audit fees                                                                       |  |                                     | 1,132 |  |                                     |  | 2,890 |                                     |  |  | 438 | 

The audit related assurance fees refer to fees for the performance of an interim review. Tax compliance fees relate to assistance in
the filing of group subsidiary statutory tax returns. Fees for other taxation services and corporate finance services predominantly relate to the disposal of development operations in handset connectivity and location to Samsung.

9. Staff Costs

The average monthly number of
employees (including executive directors) was:



|                           |  |                                      |       |  |                                      |  |       |                                      |  |  |       | 
|-------------------------- |  | ------------------------------------ | ----- |  | ------------------------------------ |  | ----- | ------------------------------------ |  |  | ----- | 
|                           |  | 52 weeks ended28 December 2012Number |       |  | 52 weeks ended30 December 2011Number |  |       | 52 weeks ended31 December 2010Number | 
|Research and development   |  |                                      | 1,654 |  |                                      |  | 1,422 |                                      |  |  | 1,052 | 
|Sales and marketing        |  |                                      | 548   |  |                                      |  | 410   |                                      |  |  | 260   | 
|General and administrative |  |                                      | 272   |  |                                      |  | 214   |                                      |  |  | 151   | 
|                           |  |                                      | 2,474 |  |                                      |  | 2,046 |                                      |  |  | 1,463 | 



|                                                    |  | 
|--------------------------------------------------- |  | 
|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Financial statements



Their aggregate remuneration comprised:



|                            |  |                                     |         |  |                                     |  |         |                                     |  |  |         | 
|--------------------------- |  | ----------------------------------- | ------- |  | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | 
|                            |  | 52 weeks ended28 December 2012$000 |         |  | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|Salaries                    |  |                                     | 262,670 |  |                                     |  | 193,258 |                                     |  |  | 142,221 | 
|Social security costs       |  |                                     | 17,541  |  |                                     |  | 13,607  |                                     |  |  | 11,704  | 
|Other pension costs         |  |                                     | 8,109   |  |                                     |  | 7,586   |                                     |  |  | 7,231   | 
|Share based payment charges |  |                                     | 25,735  |  |                                     |  | 13,918  |                                     |  |  | 9,635   | 
|                            |  |                                     | 314,055 |  |                                     |  | 228,369 |                                     |  |  | 170,791 | 

10. Investment revenue



|                                  |  |                                     |       |  |                                     |  |       |                                     |  |  |     | 
|--------------------------------- |  | ----------------------------------- | ----- |  | ----------------------------------- |  | ----- | ----------------------------------- |  |  | --- | 
|                                  |  | 52 weeks ended28 December 2012$000 |       |  | 52 weeks ended30 December 2011$000 |  |       | 52 weeks ended31 December 2010$000 | 
|Short term bank deposits          |  |                                     | 636   |  |                                     |  | 735   |                                     |  |  | 316 | 
|Treasury deposits and investments |  |                                     | 32    |  |                                     |  | 618   |                                     |  |  | 496 | 
|Expected return on plan assets    |  |                                     | 493   |  |                                     |  | 274   |                                     |  |  |    | 
|                                  |  |                                     | 1,161 |  |                                     |  | 1,627 |                                     |  |  | 812 | 

11. Other gains and losses



|                                                                                   |  |  |                                     |  |  |  |                                     |  |  |  |                                     | 
|---------------------------------------------------------------------------------- |  |  | ----------------------------------- |  |  |  | ----------------------------------- |  |  |  | ----------------------------------- | 
|                                                                                   |  |  | 52 weeks ended28 December 2012$000 |  |  |  | 52 weeks ended30 December 2011$000 |  |  |  | 52 weeks ended31 December 2010$000 | 
|Change in the fair value of investments designated as FVTPL on initial
recognition |  |  | 14                                  |  |  |  | 320                                 |  |  |  | 640                                 | 

12. Finance Costs



|                                                            |  |                                     |       |  |                                     |  |       |                                     |  |  |     | 
|----------------------------------------------------------- |  | ----------------------------------- | ----- |  | ----------------------------------- |  | ----- | ----------------------------------- |  |  | --- | 
|                                                            |  | 52 weeks ended28 December 2012$000 |       |  | 52 weeks ended30 December 2011$000 |  |       | 52 weeks ended31 December 2010$000 | 
|Interest expense and similar charges                        |  |                                     | 594   |  |                                     |  | 418   |                                     |  |  | 493 | 
|Unwinding of discount on contingent consideration           |  |                                     |      |  |                                     |  | 53    |                                     |  |  | 15  | 
|Unwinding of discount on onerous lease provision            |  |                                     | 255   |  |                                     |  | 252   |                                     |  |  | 210 | 
|Unwinding of discount on litigation accrual                 |  |                                     | 2,330 |  |                                     |  | 2,525 |                                     |  |  |    | 
|Unwinding of discount on intangible asset accrual           |  |                                     | 463   |  |                                     |  | 438   |                                     |  |  |    | 
|Unwinding of discount on defined benefit pension deficit    |  |                                     | 459   |  |                                     |  | 274   |                                     |  |  |    | 
|Unwinding of discount on acquisition fair value adjustments |  |                                     | 512   |  |                                     |  |      |                                     |  |  |    | 
|Loss on purchase of treasury shares                         |  |                                     |      |  |                                     |  | 338   |                                     |  |  |    | 
|Option premium cost                                         |  |                                     | 2,098 |  |                                     |  |      |                                     |  |  |    | 
|                                                            |  |                                     | 6,711 |  |                                     |  | 4,298 |                                     |  |  | 718 | 

13. Dividends



|                                                                                   |  |                                     |        |  |                                     |  |        |                                     |  |  |        | 
|---------------------------------------------------------------------------------- |  | ----------------------------------- | ------ |  | ----------------------------------- |  | ------ | ----------------------------------- |  |  | ------ | 
|                                                                                   |  | 52 weeks ended28 December 2012$000 |        |  | 52 weeks ended30 December 2011$000 |  |        | 52 weeks ended31 December 2010$000 | 
|Proposed final dividend for the 52 weeks ended 28 December 2012 of $0.08 per share |  |                                     | 13,267 |  |                                     |  |       |                                     |  |  |       | 
|Interim dividend for the 26 weeks ended 30 June 2012 of 2.3p per share             |  |                                     | 7,648  |  |                                     |  |       |                                     |  |  |       | 
|Final dividend for the 52 weeks ended 30 December 2011 of 4.41p per share          |  |                                     |       |  |                                     |  | 13,617 |                                     |  |  |       | 
|Interim dividend for the 26 weeks ended 1 July 2011 of 2p per share                |  |                                     |       |  |                                     |  | 5,376  |                                     |  |  |       | 
|Final dividend for the 52 weeks ended 31 December 2010 of 4p per
share             |  |                                     |       |  |                                     |  |       |                                     |  |  | 10,973 | 
|                                                                                   |  |                                     | 20,915 |  |                                     |  | 18,993 |                                     |  |  | 10,973 | 

The proposed final dividend of $0.08 per share is subject to approval by shareholders at the Annual General Meeting and has not been
included as a liability in the financial statements.



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##### Table of Contents

Financial statements

Notes to the consolidated financial statements continued



14. Taxation



|                                                                                                    |  |                                     |         |   |                                     |  |         |                                     |  |  |         |  
|--------------------------------------------------------------------------------------------------- |  | ----------------------------------- | ------- | - | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | -
|                                                                                                    |  | 52 weeks ended28 December 2012$000 |         |   | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|Current income tax payable                                                                          |  |                                     | 16,861  |   |                                     |  | 2,143   |                                     |  |  | 2,383   |  
|Adjustment in respect of current income tax of prior years                                          |  |                                     | (299    | ) |                                     |  | 2,171   |                                     |  |  | (1,780  | )
|Total current income tax charge                                                                     |  |                                     | 16,562  |   |                                     |  | 4,314   |                                     |  |  | 603     |  
|Deferred tax charge (credit)                                                                        |  |                                     | 45,373  |   |                                     |  | (6,751  | )                                   |  |  | (19,073 | )
|Deferred tax benefit on recognition of previously unrecognized tax losses and temporary differences |  |                                     | (16,456 | ) |                                     |  | (78,664 | )                                   |  |  | (12,172 | )
|Deferred tax expense from de-recognition of tax losses                                              |  |                                     | 0       |   |                                     |  | 900     |                                     |  |  | 5,048   |  
|Deferred tax rate change                                                                            |  |                                     | 1,817   |   |                                     |  | 1,843   |                                     |  |  | 531     |  
|Adjustment in respect of deferred tax of prior years                                                |  |                                     | 3,453   |   |                                     |  | (6,972  | )                                   |  |  | 2,732   |  
|Total deferred tax charge (credit) (note 24)                                                        |  |                                     | 34,187  |   |                                     |  | (89,644 | )                                   |  |  | (22,934 | )
|Total tax charge (credit)                                                                           |  |                                     | 50,749  |   |                                     |  | (85,330 | )                                   |  |  | (22,331 | )

Corporation tax is calculated at 24.5% (2011: 26.5%; 2010: 28.0%); of the estimated assessable loss for the period.

Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions.

The credit for the period can be reconciled to the Profit (loss) per the income statement as follows:



|                                                                                                                                   |  |                                |         |   |                                |  |       |                                |  |  |         |   |  |       |       |   |   |  |         |   |  |  |       |  
|---------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------ | ------- | - | ------------------------------ |  | ----- | ------------------------------ |  |  | ------- | - |  | ----- | ----- | - | - |  | ------- | - |  |  | ----- | -
|                                                                                                                                   |  | 52 weeks ended28 December 2012 |         |   | 52 weeks ended30 December 2011 |  |       | 52 weeks ended31 December 2010 | 
|                                                                                                                                   |  | $000                          |         |   | %                              |  |       | $000                          |  |  | %       |   |  | $000 |       |   | % | 
|Profit/(Loss) before tax                                                                                                           |  |                                | 101,982 |   |                                |  | 100.0 |                                |  |  | (51,464 | ) |  |       | 100.0 |   |   |  | (5,705  | ) |  |  | 100.0 |  
|Tax at the UK corporation tax rate of 24.5% (2011: 26.5%, 2010: 28%)                                                               |  |                                | 24,984  |   |                                |  | 24.5  |                                |  |  | (13,638 | ) |  |       | 26.5  |   |   |  | (1,597  | ) |  |  | 28.0  |  
|Tax benefit of research and development expenditure                                                                                |  |                                | (11,456 | ) |                                |  | (11.2 | )                              |  |  | (7,529  | ) |  |       | 14.6  |   |   |  | (7,337  | ) |  |  | 128.6 |  
|Effect of different tax rates of subsidiaries operating in other tax jurisdictions                                                 |  |                                | 6,834   |   |                                |  | 6.7   |                                |  |  | 5,441   |   |  |       | (10.6 | ) |   |  | (10,908 | ) |  |  | 191.2 |  
|Adjustments to tax charge in respect of prior years                                                                                |  |                                | 3,154   |   |                                |  | 3.1   |                                |  |  | (4,801  | ) |  |       | 9.3   |   |   |  | 952     |   |  |  | (16.7 | )
|Effect of tax holidays in foreign jurisdictions                                                                                    |  |                                |        |   |                                |  |      |                                |  |  |        |   |  |       |      |   |   |  | (450    | ) |  |  | 7.9   |  
|Non-deductible expenses                                                                                                            |  |                                | 8,736   |   |                                |  | 8.6   |                                |  |  | 8,027   |   |  |       | (15.6 | ) |   |  | 3,602   |   |  |  | (63.1 | )
|Recognition of previously unrecognized tax losses and temporary differences                                                        |  |                                | (16,456 | ) |                                |  | (16.1 | )                              |  |  | (78,664 | ) |  |       | 152.9 |   |   |  | (12,172 | ) |  |  | 213.2 |  
|Current year tax losses not recognised                                                                                             |  |                                | 9,626   |   |                                |  | 9.4   |                                |  |  | 3,091   |   |  |       | (6.0  | ) |   |  |        |   |  |  |      |  
|Deferred tax rate change                                                                                                           |  |                                | 1,817   |   |                                |  | 1.8   |                                |  |  | 1,843   |   |  |       | (3.6  | ) |   |  | 531     |   |  |  | (9.3  | )
|De-recognition of tax losses                                                                                                       |  |                                |        |   |                                |  |      |                                |  |  | 900     |   |  |       | (1.7  | ) |   |  | 5,048   |   |  |  | (88.4 | )
|Foreign witholding tax                                                                                                             |  |                                | 6,397   |   |                                |  | 6.3   |                                |  |  |        |   |  |       |      |   |   |  |        |   |  |  |      |  
|Non-deductible costs and goodwill disposal relating to the disposal of development
operations in handset connectivity and location |  |                                | 17,113  |   |                                |  | 16.7  |                                |  |  |        |   |  |       |      |   |   |  |        |   |  |  |      |  
|Tax charge (credit) and effective tax rate for the period                                                                          |  |                                | 50,749  |   |                                |  | 49.8  |                                |  |  | (85,330 | ) |  |       | 165.8 |   |   |  | (22,331 | ) |  |  | 391.4 |  

Finance Act 2012 enacted reductions in the UK corporation tax rate from 25% to 24% from 1 April 2012 and 23% from 1 April
2013. The effect of the new rate is to reduce the deferred tax asset by $1.9m.

An additional change to the main rate of UK corporation tax is proposed,
to reduce the rate to 22% by 1 April 2014 and 21% by 1 April 2015. These changes had not been substantially enacted by the Balance Sheet date and consequently, not included in these financial statements.

The effect of this decrease in the tax rate to 21% on the Groups deferred tax assets has been assessed and the impact is a reduction in the deferred tax asset
of $469,794 (2011: $2,675,547).

In addition to the amounts charged to the income statement, the following amounts relating to tax have been recognised
directly in other comprehensive income:



|                                                                         |  |                                     |        |   |                                     |  |       |                                     |  |  |      |  
|------------------------------------------------------------------------ |  | ----------------------------------- | ------ | - | ----------------------------------- |  | ----- | ----------------------------------- |  |  | ---- | -
|Deferred tax                                                             |  | 52 weeks ended28 December 2012$000 |        |   | 52 weeks ended30 December 2011$000 |  |       | 52 weeks ended31 December 2010$000 | 
|Arising on income and expenses recognised in other comprehensive income: |  |                                     |        |   |                                     |  |       |                                     |  |  |      |  
|Net tax on cash flow hedges                                              |  |                                     | (1,210 | ) |                                     |  | (427  | )                                   |  |  | 870  |  
|Reclassifications from equity to profit or loss:                         |  |                                     |        |   |                                     |  |       |                                     |  |  |      |  
|Relating to cash flow hedges                                             |  |                                     | 253    |   |                                     |  | 1,080 |                                     |  |  | (199 | )
|Total income tax recognised directly in other comprehensive income       |  |                                     | (957   | ) |                                     |  | 653   |                                     |  |  | 671  |  



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|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Financial statements



In addition to the amount charged to the income statement and other comprehensive
income, the following amounts relating to tax have been recognised directly in equity:



|                                                           |  |                                     |     |  |                                     |  |      |                                     |  |  |     | 
|---------------------------------------------------------- |  | ----------------------------------- | --- |  | ----------------------------------- |  | ---- | ----------------------------------- |  |  | --- | 
|Current tax                                                |  | 52 weeks ended28 December 2012$000 |     |  | 52 weeks ended30 December 2011$000 |  |      | 52 weeks ended31 December 2010$000 | 
|Current tax benefit taken to equity on share option gains. |  |                                     |    |  |                                     |  | 162  |                                     |  |  |    | 
|Deferred tax                                               |  |                                     |     |  |                                     |  |      |                                     |  |  |     | 
|Deferred tax benefit (reduction) on share option gains     |  |                                     | 573 |  |                                     |  | (645 | )                                   |  |  | 182 | 
|Total income tax recognised directly in equity             |  |                                     | 573 |  |                                     |  | (483 | )                                   |  |  | 182 | 

15. Earnings Per Share

The calculations of earnings per share are based on the following data:



|                                                             |  |                                     |             |  |                                     |  |             |                                     |  |  |             | 
|------------------------------------------------------------ |  | ----------------------------------- | ----------- |  | ----------------------------------- |  | ----------- | ----------------------------------- |  |  | ----------- | 
|Earnings                                                     |  | 52 weeks ended28 December 2012$000 |             |  | 52 weeks ended30 December 2011$000 |  |             | 52 weeks ended31 December 2010$000 | 
|Profit for the period                                        |  |                                     | 51,233      |  |                                     |  | 33,866      |                                     |  |  | 16,626      | 
|                                                             |  |                                     |            
|Number of shares                                             |  | Number of shares                    |             |  | Number of shares                    |  |             | Number of shares                    | 
|Weighted average number of shares:                           |  |                                     |             |  |                                     |  |             |                                     |  |  |             | 
|For basic earnings per share                                 |  |                                     | 197,238,649 |  |                                     |  | 178,198,771 |                                     |  |  | 178,074,862 | 
|Effect of dilutive potential ordinary shares  share options |  |                                     | 5,992,855   |  |                                     |  | 3,195,201   |                                     |  |  | 2,959,012   | 
|For diluted earnings per share                               |  |                                     | 203,231,504 |  |                                     |  | 181,393,972 |                                     |  |  | 181,033,874 | 

16. Goodwill



|                                                                                                |  |       |          |  
|----------------------------------------------------------------------------------------------- |  | ----- | -------- | -
|Cost                                                                                            |  | $000 |         
|At 31 December 2010                                                                             |  |       | 261,558  |  
|Recognised on acquisition of Zoran Corporation (note 39)                                        |  |       | 108,098  |  
|At 30 December 2011                                                                             |  |       | 369,656  |  
|Derecognised on disposal of development operations in handset connectivity and handset location |  |       | (151,477 | )
|Adjustment to Goodwill recognised on acquisition of Zoran
Corporation                           |  |       | 605      |  
|At 28 December 2012                                                                             |  |       | 218,784  |  
|                                                                                                | 
|Accumulated impairment losses                                                                   |  |       |          |  
|At 31 December 2010, 30 December 2011 and 28 December
2012                                      |  |       | (36,907  | )
|Carrying Amount                                                                                 |  |       |          |  
|At 28 December 2012                                                                             |  |       | 181,877  |  
|At 30 December 2011                                                                             |  |       | 332,749  |  
|At 31 December 2010                                                                             |  |       | 224,651  |  

Goodwill acquired in a business combination is allocated, at acquisition, to the cash generating units that are expected to benefit
from that business combination. Further disclosures are provided below for all cash generating units where the Group holds an individual goodwill item relating to a CGU which is significant, which management considers to be 10% of the total net book
value in comparison with the Groups total carrying value of goodwill, or, where there are no significant allocations of goodwill at a lower level, for groups of cash generating units within a reportable segment. The carrying amount of goodwill
has been allocated as follows:



|                                              |  |                       |         |  |                       |  |         | 
|--------------------------------------------- |  | --------------------- | ------- |  | --------------------- |  | ------- | 
|Reportable segments and cash generating units |  | 28 December 2012$000 |         |  | 30 December 2011$000 | 
| Automotive Business Group                   |  |                       | 51,404  |  |                       |  | 51,404  | 
| Consumer Business Group                     |  |                       |         |  |                       |  |         | 
|Printers                                      |  |                       | 58,161  |  |                       |  | 57,840  | 
|Cameras                                       |  |                       | 50,537  |  |                       |  | 50,258  | 
|Other Consumer CGUs                           |  |                       | 9,505   |  |                       |  | 12,770  | 
| Voice & Music Business Group                |  |                       | 12,270  |  |                       |  | 9,000   | 
| Legacy Product Group                        |  |                       |        |  |                       |  | 151,477 | 
|                                              |  |                       | 181,877 |  |                       |  | 332,749 | 

Goodwill of $ 151.5 million allocated to the Legacy product group cash generating unit was derecognised following the disposal
of development operations in handset connectivity and handset location to Samsung during 2012. There is now no goodwill allocated to this cash generating unit.

Goodwill of $108.7 million was recognised on the acquisition of Zoran during 2011, of which $0.6m was recognised due to a change in the fair value of assets acquired identified during 2012. Of the total goodwill,
$50.5 million was allocated to the Cameras cash generating unit and $58.2 million was allocated to the Printers cash generating units based on the relative fair value of these cash generating units. Following this acquisition and the subsequent
announcement that the Group would discontinue investment in digital television systems-on-a-chip and in silicon tuners, an internal reorganisation was completed which affected the cash generating units of the Group. Goodwill balances present at
the time of the acquisition were reallocated to new cash generating units or to groups of cash generating units where they represented the lowest level at which goodwill was monitored.

In 2010 goodwill of $3.2 million was recognised on the acquisition of APT Licencing Limited and was allocated to the Consumer cash generating unit (which at the time excluded Printers), as this unit was expected to
realise the benefits of the acquisition.



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##### Table of Contents

Financial statements

Notes to the consolidated financial statements continued



The Group tests goodwill for impairment on an annual basis or more frequently if there are indications that goodwill might be impaired. At various times during 2012, the net assets of the Group have exceeded its
market capitalisation and management have performed additional impairment testing. Following the tests throughout the year and the annual impairment test which takes place in the fourth quarter of each year, it was determined that no impairment of
goodwill is required.

Estimation Methodology

The recoverable amounts of the Groups CGUs are determined from value in use calculations based upon cash flow forecasts derived from the most recent financial budget approved by management and the Board of
Directors for the next year and longer range financial plans covering the subsequent four years that have been reviewed and approved by management and the Board of Directors. The key assumptions for the value in use calculations are those regarding
the growth in future sales, projected production costs, operating expenditures, the discount rates and terminal growth rates.

Future sales are estimated
based on recent reports on the markets the Group operates in, produced by independent analysts and containing estimates for market size for a number of different technologies in different end markets. These external estimates are compared with
internal estimates to produce a considered view of available market size and likely market shares. Management uses this information, combined with internal customer specific information regarding design wins, projected changes in market share
based on current positions and forecast technology penetration rates, to derive its best assessment of the future sales and gross margins. A terminal value is included for the period beyond five years from the balance sheet date based upon the
estimated cashflows in the fifth year and a terminal growth rate.

Variation in selling prices and direct costs are based on well established trends in
the semiconductor industry as well as managements experience of how pricing and direct costs vary over a products lifecycle, incorporating the impacts of already quoted selling prices and the result of discussions with suppliers on
future direct cost movements.

Projected operating expenditures are consistent with the long term operating model of the Group, specifically R&D
expense of approximately 25% (2011: 23%; 2010: 20%) of revenue and SG&A expense of around 12% (2011: 10%; 2010: 10%) of revenue. Approved forecasts assume the Group reaches these ratios over a period of a number of years. The actual operating
costs for the group were 52% in 2012 (2011: 44%), with the full-year absorption of the Zoran cost base only partially offset by synergy savings achieved during the year. Changes in selling prices and direct costs are based on past practices and
expectations of future changes in the market.

Management estimates discount rates using pre-tax rates that reflect current market assessments of the
time value of money and the risks specific to the group, specifically using a weighted average cost of capital and estimating risk free rates based on US Treasury Bonds, using published equity betas for the group and making a reasonable estimate of
the Equity Risk Premium. Management has concluded that it is appropriate to use a pre tax discount rate of 11.7%, which fully reflects the risk profile of the Group. In the prior period, management concluded that it was appropriate to use a
different discount rate for the former CSR and the former Zoran businesses, reflecting their differing level of confidence that risk is fully incorporated into the forecast cash flows.

Within the former CSR business, as the forecast cash flows had been adjusted for the risks specific to each cash generating unit, with the discount rate reflecting the risk specific to the former CSR business as a
whole, the pre-tax rate used to discount the forecast cash flows was 11%. Within the former Zoran business, management attached a greater degree of risk to the acquired cash generating units, the pre-tax rate used to discount the forecast cash flows
was 13%. This has been calculated on a basis which is consistent with the assumptions used in valuing the acquired intangible assets, as outlined in note 39.

During 2012 management reviewed the long term growth rates in the markets in which the Group operates; as much of our business operates in Asian markets where growth rates are typically higher it was concluded that
3.5% was an appropriate terminal growth rate to use across the business (2011: 3.5%). While growth rates have fallen globally due to the macro economic situation, this rate is below the long term growth rate projected for our major markets.

The estimation methodology is the same for all cash generating units.

The Group has conducted sensitivity analysis on a variety of scenarios when completing the annual impairment review. The directors have concluded that there are no cash generating units where reasonably possible
changes in assumptions would cause the carrying amount of goodwill to exceed value in use.



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|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Financial statements



17. Other Intangible Assets



|                                        |  |                                    |       |  |                  |  |       |                                   |  |  |                                                 |  |  |                                         |         |   |                                               |  |        |                                         |  |  |            |   |  |  |       |   |  |  |         |  
|--------------------------------------- |  | ---------------------------------- | ----- |  | ---------------- |  | ----- | --------------------------------- |  |  | ----------------------------------------------- |  |  | --------------------------------------- | ------- | - | --------------------------------------------- |  | ------ | --------------------------------------- |  |  | ---------- | - |  |  | ----- | - |  |  | ------- | -
|                                        |  | InternallyDevelopedTechnology$000 |       |  | Trade names$000 |  |       | PurchasedDevelopedTechnology$000 |  |  | Purchasedin processresearch anddevelopment$000 |  |  | Customercontracts andrelationships$000 |         |   | Softwarelicences andintellectualproperty$000 |  |        | Assets in thecourse ofconstruction$000 |  |  | Total$000 |  
|Cost                                    |  |                                    |       |  |                  |  |       |                                   |  |  |                                                 |  |  |                                         |         |   |                                               |  |        |                                         |  |  |            |   |  |  |       |   |  |  |         |  
|At 31 December 2010                     |  |                                    | 4,723 |  |                  |  | 2,450 |                                   |  |  | 12,800                                          |  |  |                                         | 41,250  |   |                                               |  | 14,200 |                                         |  |  | 22,475     |   |  |  | 1,175 |   |  |  | 99,073  |  
|Additions                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | 19,341     |   |  |  |      |   |  |  | 19,341  |  
|Disposals                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         | (13,400 | ) |                                               |  | (2,000 | )                                       |  |  |           |   |  |  | (87   | ) |  |  | (15,487 | )
|Transfers                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | 782        |   |  |  | (782  | ) |  |  |        |  
|Acquired with acquisition of subsidiary |  |                                    |      |  |                  |  | 3,060 |                                   |  |  | 51,380                                          |  |  |                                         | 9,240   |   |                                               |  | 35,077 |                                         |  |  | 493        |   |  |  | 26    |   |  |  | 99,276  |  
|At 30 December 2011                     |  |                                    | 4,723 |  |                  |  | 5,510 |                                   |  |  | 64,180                                          |  |  |                                         | 37,090  |   |                                               |  | 47,277 |                                         |  |  | 43,091     |   |  |  | 332   |   |  |  | 202,203 |  
|Additions                               |  |                                    |      |  |                  |  |      |                                   |  |  | 250                                             |  |  |                                         | 3,540   |   |                                               |  |       |                                         |  |  | 25,216     |   |  |  | 118   |   |  |  | 29,124  |  
|Disposals                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | (189       | ) |  |  |      |   |  |  | (189    | )
|Disposal of development operations      |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | (2,700     | ) |  |  |      |   |  |  | (2,700  | )
|Transfers                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | 160        |   |  |  | (160  | ) |  |  |        |  
|At 28 December 2012                     |  |                                    | 4,723 |  |                  |  | 5,510 |                                   |  |  | 64,430                                          |  |  |                                         | 40,630  |   |                                               |  | 47,277 |                                         |  |  | 65,578     |   |  |  | 290   |   |  |  | 228,438 |  
|Amortisation                            |  |                                    |       |  |                  |  |       |                                   |  |  |                                                 |  |  |                                         |         |   |                                               |  |        |                                         |  |  |            |   |  |  |       |   |  |  |         |  
|At 31 December 2010                     |  |                                    | 1,568 |  |                  |  | 1,770 |                                   |  |  | 6,047                                           |  |  |                                         | 33,587  |   |                                               |  | 6,804  |                                         |  |  | 13,227     |   |  |  |      |   |  |  | 63,003  |  
|Charge for the year                     |  |                                    | 1,526 |  |                  |  | 805   |                                   |  |  | 6,383                                           |  |  |                                         | 6,501   |   |                                               |  | 4,994  |                                         |  |  | 6,144      |   |  |  |      |   |  |  | 26,353  |  
|Impairment loss                         |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         | 500     |   |                                               |  |       |                                         |  |  |           |   |  |  |      |   |  |  | 500     |  
|Disposals                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         | (13,400 | ) |                                               |  | (2,000 | )                                       |  |  |           |   |  |  |      |   |  |  | (15,400 | )
|At 30 December 2011                     |  |                                    | 3,094 |  |                  |  | 2,575 |                                   |  |  | 12,430                                          |  |  |                                         | 27,188  |   |                                               |  | 9,798  |                                         |  |  | 19,371     |   |  |  |      |   |  |  | 74,456  |  
|Charge for the year                     |  |                                    | 1,392 |  |                  |  | 802   |                                   |  |  | 10,195                                          |  |  |                                         | 3,855   |   |                                               |  | 7,879  |                                         |  |  | 6,362      |   |  |  |      |   |  |  | 30,485  |  
|Impairment loss                         |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | 2,300      |   |  |  |      |   |  |  | 2,300   |  
|Disposals                               |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | (189       | ) |  |  |      |   |  |  | (189    | )
|Disposal of development operations (1)  |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         | 713     |   |                                               |  |       |                                         |  |  |           |   |  |  |      |   |  |  | 713     |  
|Transfers                               |  |                                    | 237   |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | (237       | ) |  |  |      |   |  |  |        |  
|At 28 December 2012                     |  |                                    | 4,723 |  |                  |  | 3,377 |                                   |  |  | 22,625                                          |  |  |                                         | 31,756  |   |                                               |  | 17,677 |                                         |  |  | 27,607     |   |  |  |      |   |  |  | 107,765 |  
|Carrying amount                         |  |                                    |       |  |                  |  |       |                                   |  |  |                                                 |  |  |                                         |         |   |                                               |  |        |                                         |  |  |            |   |  |  |       |   |  |  |         |  
|At 28 December 2012                     |  |                                    |      |  |                  |  | 2,133 |                                   |  |  | 41,805                                          |  |  |                                         | 8,874   |   |                                               |  | 29,600 |                                         |  |  | 37,971     |   |  |  | 290   |   |  |  | 120,673 |  
|At 30 December 2011                     |  |                                    | 1,629 |  |                  |  | 2,935 |                                   |  |  | 51,750                                          |  |  |                                         | 9,902   |   |                                               |  | 37,479 |                                         |  |  | 23,720     |   |  |  | 332   |   |  |  | 127,747 |  
|At 31 December 2010                     |  |                                    | 3,155 |  |                  |  | 680   |                                   |  |  | 6,753                                           |  |  |                                         | 7,663   |   |                                               |  | 7,396  |                                         |  |  | 9,248      |   |  |  | 1,175 |   |  |  | 36,070  |  
|Leased assets included above:           |  |                                    |       |  |                  |  |       |                                   |  |  |                                                 |  |  |                                         |         |   |                                               |  |        |                                         |  |  |            |   |  |  |       |   |  |  |         |  
|At 28 December 2012                     |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | 1,099      |   |  |  |      |   |  |  | 1,099   |  
|At 30 December 2011                     |  |                                    |      |  |                  |  |      |                                   |  |  |                                                |  |  |                                         |        |   |                                               |  |       |                                         |  |  | 237        |   |  |  |      |   |  |  | 237     |  



|(1) | this relates to accelerated amortisation on assets as part of the disposal of development operations.
|--- | -----------------------------------------------------------------------------------------------------

The impairment charge of $2.3 million (which is included within Integration and restructuring costs as disclosed in note 33) is in relation to certain CCL Licenses held by the Group. Following the disposal of
development operations in handset connectivity and location, management reassessed the carrying value of its intangible assets associated with the Handsets business line, now within the Legacy Product Group. It was identified that the carrying
amount of these assets was no longer recoverable and the assets have been fully impaired accordingly.

In the first quarter of 2012, the Group purchased
capabilities in digital class D audio amplifier technology from Diodes Inc. An addition of $0.3m in Purchased Developed Technology and an addition of $2.5 million in Purchased in Process Research & Development was recognised as a
consequence of this transaction.

The impairment charge of $0.5 million (this is included within Integration and restructuring in note 33), recognised in
the 52 week period ended 30 December 2011, is in relation to intangibles acquired as part of the acquisition of Zoran Corporation. Following the public announcement of the discontinuation of the Groups investment in both Digital TV and
silicon tuners, management reassessed the valuation of the intangible assets associated with the Legacy Product Group. It had been identified that the carrying amount of certain of these assets was not fully recoverable and accordingly an impairment
charge had been recognised in the prior period.

In the first quarter of 2011, along with other wireless semiconductor companies, CSR negotiated a
confidential settlement agreement with Wi-LAN to dismiss all litigation against CSR and its customers and obtain a multi-year licensing arrangement with respect to Wi-LANs wireless patent portfolio, resulting in an increase in software
licences and purchased intellectual property during the prior period.

At 28 December 2012, the Group had entered into contractual commitments for
the acquisition of other intangible assets amounting to $nil (2011: $nil).



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##### Table of Contents

Financial statements

Notes to the consolidated financial statements continued



18. Property, Plant and Equipment



|                                        |  |                    |        |   |                            |  |        |                            |  |  |                        |   |  |                      |        |   |            |  |       |   |  |  |         |  
|--------------------------------------- |  | ------------------ | ------ | - | -------------------------- |  | ------ | -------------------------- |  |  | ---------------------- | - |  | -------------------- | ------ | - | ---------- |  | ----- | - |  |  | ------- | -
|                                        |  | Testequipment$000 |        |   | Leaseholdimprovements$000 |  |        | Furnitureand fittings$000 |  |  | Computerequipment$000 |   |  | Officeequipment$000 |        |   | Total$000 | 
|Cost                                    |  |                    |        |   |                            |  |        |                            |  |  |                        |   |  |                      |        |   |            |  |       |   |  |  |         |  
|At 31 December 2010                     |  |                    | 85,295 |   |                            |  | 9,660  |                            |  |  | 4,049                  |   |  |                      | 25,352 |   |            |  | 3,783 |   |  |  | 128,139 |  
|Additions                               |  |                    | 8,636  |   |                            |  | 2,218  |                            |  |  | 539                    |   |  |                      | 3,147  |   |            |  | 399   |   |  |  | 14,939  |  
|Disposals                               |  |                    | (403   | ) |                            |  | (1,128 | )                          |  |  | (152                   | ) |  |                      | (3,262 | ) |            |  | (67   | ) |  |  | (5,012  | )
|Acquired with acquisition of subsidiary |  |                    | 6,362  |   |                            |  | 1,075  |                            |  |  | 620                    |   |  |                      | 4,335  |   |            |  | 59    |   |  |  | 12,451  |  
|At 30 December 2011                     |  |                    | 99,890 |   |                            |  | 11,825 |                            |  |  | 5,056                  |   |  |                      | 29,572 |   |            |  | 4,174 |   |  |  | 150,517 |  
|Additions                               |  |                    | 6,355  |   |                            |  | 1,534  |                            |  |  | 707                    |   |  |                      | 2,737  |   |            |  | 686   |   |  |  | 12,019  |  
|Disposals                               |  |                    | (861   | ) |                            |  | (1,749 | )                          |  |  | (2,249                 | ) |  |                      | (2,059 | ) |            |  | (324  | ) |  |  | (7,242  | )
|Disposal of development operations      |  |                    | (9,574 | ) |                            |  | (52    | )                          |  |  | (429                   | ) |  |                      | (618   | ) |            |  | (32   | ) |  |  | (10,705 | )
|At 28 December 2012                     |  |                    | 95,810 |   |                            |  | 11,558 |                            |  |  | 3,085                  |   |  |                      | 29,632 |   |            |  | 4,504 |   |  |  | 144,589 |  
|Depreciation                            |  |                    |        |   |                            |  |        |                            |  |  |                        |   |  |                      |        |   |            |  |       |   |  |  |         |  
|At 31 December 2010                     |  |                    | 66,475 |   |                            |  | 6,618  |                            |  |  | 2,950                  |   |  |                      | 21,638 |   |            |  | 2,104 |   |  |  | 99,785  |  
|Charge for the year                     |  |                    | 11,106 |   |                            |  | 1,977  |                            |  |  | 670                    |   |  |                      | 3,994  |   |            |  | 624   |   |  |  | 18,371  |  
|Impairment loss                         |  |                    | 1,253  |   |                            |  | 7      |                            |  |  | 6                      |   |  |                      | 510    |   |            |  |      |   |  |  | 1,776   |  
|Disposals                               |  |                    | (371   | ) |                            |  | (327   | )                          |  |  | (126                   | ) |  |                      | (3,025 | ) |            |  | (86   | ) |  |  | (3,935  | )
|At 30 December 2011                     |  |                    | 78,463 |   |                            |  | 8,275  |                            |  |  | 3,500                  |   |  |                      | 23,117 |   |            |  | 2,642 |   |  |  | 115,997 |  
|Charge for the year                     |  |                    | 10,168 |   |                            |  | 2,237  |                            |  |  | 426                    |   |  |                      | 2,710  |   |            |  | 630   |   |  |  | 16,171  |  
|Disposals                               |  |                    | (796   | ) |                            |  | (1,471 | )                          |  |  | (1,779                 | ) |  |                      | (2,043 | ) |            |  | (237  | ) |  |  | (6,326  | )
|Disposal of development operations      |  |                    | (6,620 | ) |                            |  | (9     | )                          |  |  | (387                   | ) |  |                      | (586   | ) |            |  |      |   |  |  | (7,602  | )
|At 28 December 2012                     |  |                    | 81,215 |   |                            |  | 9,032  |                            |  |  | 1,760                  |   |  |                      | 23,198 |   |            |  | 3,035 |   |  |  | 118,240 |  
|Carrying amount                         |  |                    |        |   |                            |  |        |                            |  |  |                        |   |  |                      |        |   |            |  |       |   |  |  |         |  
|At 28 December 2012                     |  |                    | 14,595 |   |                            |  | 2,526  |                            |  |  | 1,325                  |   |  |                      | 6,434  |   |            |  | 1,469 |   |  |  | 26,349  |  
|At 30 December 2011                     |  |                    | 21,427 |   |                            |  | 3,550  |                            |  |  | 1,556                  |   |  |                      | 6,455  |   |            |  | 1,532 |   |  |  | 34,520  |  
|At 31 December 2010                     |  |                    | 18,820 |   |                            |  | 3,042  |                            |  |  | 1,099                  |   |  |                      | 3,714  |   |            |  | 1,679 |   |  |  | 28,354  |  
|Leased assets included above:           |  |                    |        |   |                            |  |        |                            |  |  |                        |   |  |                      |        |   |            |  |       |   |  |  |         |  
|Carrying amount                         |  |                    |        |   |                            |  |        |                            |  |  |                        |   |  |                      |        |   |            |  |       |   |  |  |         |  
|At 28 December 2012                     |  |                    |       |   |                            |  |       |                            |  |  |                       |   |  |                      |       |   |            |  | 127   |   |  |  | 127     |  
|At 30 December 2011                     |  |                    |       |   |                            |  |       |                            |  |  |                       |   |  |                      |       |   |            |  | 238   |   |  |  | 238     |  

The impairment charge of $1.8 million recorded within the prior year comparatives (which is part of the Integration and
Restructuring expense discussed in note 33) is in relation to items of property plant and equipment associated with the Legacy Product Group. As a consequence of the decision to discontinue the investment in both Digital TV and silicon tuners, these
items were no longer required and accordingly an impairment charge was recognised in the prior period.

At 28 December 2012, the Group had entered
into contractual commitments for the acquisition of property, plant and equipment amounting to $930,000 (30 December 2011: $1,030,000).

19. Investments



|                                                     |  |                       |       |  |                       |  |       | 
|---------------------------------------------------- |  | --------------------- | ----- |  | --------------------- |  | ----- | 
|Available for sale investments carried at fair value |  | 28 December 2012$000 |       |  | 30 December 2011$000 | 
|Shares in unquoted equity securities                 |  |                       | 3,719 |  |                       |  | 3,610 | 

20. Long-term assets



| |  |                       |        |  |                       |  |   | 
| |  | --------------------- | ------ |  | --------------------- |  | - | 
| |  | 28 December 2012$000 |        |  | 30 December 2011$000 | 
| |  |                       | 31,000 |  |                       |  |  | 

As part of the disposal of development operations in handset connectivity and location, $31 million of the cash consideration was
not received directly into CSR, but was placed by Samsung into an escrow account for use against future potential warranty claims from third parties. CSR has full rights over this cash, which will revert to CSR if unused after 36
months.

The escrow account will be closed in October 2015, which is 36 months after the disposal of the development operations in handset connectivity
and location, unless there are open and unsettled claims, in which case funds will be retained within the escrow account to settle these. Any new claims arising after 36 months will be settled by Samsung, with no further liability to the Group.
There were no claims, either filed or outstanding, at the Balance Sheet date.

The Group has rights over any interest arising on the balance in escrow
account and hence there is no requirement to discount the long term asset.



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Financial statements



The amounts held in escrow have been included as a component of the consideration for
the disposal of development operations in handset connectivity and location, see note 38.

21. Inventories



|                 |  |                       |        |  |                       |  |         | 
|---------------- |  | --------------------- | ------ |  | --------------------- |  | ------- | 
|                 |  | 28 December 2012$000 |        |  | 30 December 2011$000 | 
|Raw materials    |  |                       | 25,973 |  |                       |  | 36,631  | 
|Work in progress |  |                       | 23,016 |  |                       |  | 22,576  | 
|Finished goods   |  |                       | 38,861 |  |                       |  | 61,140  | 
|                 |  |                       | 87,850 |  |                       |  | 120,347 | 

22. Other Financial Assets



|                                                  |  |                       |         |  |                       |  |         | 
|------------------------------------------------- |  | --------------------- | ------- |  | --------------------- |  | ------- | 
|Trade and other receivables                       |  | 28 December 2012$000 |         |  | 30 December 2011$000 | 
|Amounts receivable for sale of goods and software |  |                       | 80,003  |  |                       |  | 86,144  | 
|Amounts receivable for royalties                  |  |                       | 14,926  |  |                       |  | 12,344  | 
|Total trade receivables                           |  |                       | 94,929  |  |                       |  | 98,488  | 
|VAT                                               |  |                       | 2,810   |  |                       |  | 3,432   | 
|Other debtors                                     |  |                       | 5,897   |  |                       |  | 5,534   | 
|Prepayments and accrued income                    |  |                       | 14,070  |  |                       |  | 16,343  | 
|                                                  |  |                       | 117,706 |  |                       |  | 123,797 | 

The average credit period taken on trade receivables is 39 days (30 December 2011: 40 days). A specific allowance has been made for
estimated irrecoverable amounts within trade receivables of $449,000 (30 December 2011: $156,000). This allowance has been determined by reference to past default experience. An allowance for credit notes and price adjustments has also been made
within trade receivables of $350,000 (30 December 2011: $400,000).

Before accepting any new customers, the Group uses a credit scoring system to assess
the potential customers credit quality and define credit limits by customer. Credit limits and credit quality are regularly reviewed. It is the policy of the Group to only transact with creditworthy entities to mitigate the risk of default
associated with trade receivables. The Group provides for trade receivables based on amounts estimated as irrecoverable determined by reference to past default experience.

The directors consider that the carrying amount of trade and other receivables approximates to their fair value.

Cash and Cash Equivalents

Bank balances and cash comprise cash held by the Group and short term bank
deposits with an original maturity of three months or less. The carrying amount of these assets approximates to their fair value.

Treasury Deposits and Investment

Treasury deposits
and investments represent bank deposits and obligations of the United States treasury with an original maturity of over three months. Some of these amounts are held as FVTPL assets (see note 36).

Credit Risk

The Groups principal financial
assets are bank balances and cash, treasury deposits and trade and other receivables.

The credit risk on liquid funds and derivative financial
instruments is actively managed to limit the associated risk and counterparties are banks with high credit ratings assigned by international credit rating agencies.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit
exposure. The maximum exposure to credit risk at the reporting date was:



|                                  |  |                       |         |  |                       |  |         | 
|--------------------------------- |  | --------------------- | ------- |  | --------------------- |  | ------- | 
|                                  |  | 28 December 2012$000 |         |  | 30 December 2011$000 | 
|Total trade receivables           |  |                       | 94,929  |  |                       |  | 98,488  | 
|VAT and other debtors             |  |                       | 8,707   |  |                       |  | 8,966   | 
|Cash and cash equivalents         |  |                       | 314,760 |  |                       |  | 211,907 | 
|Treasury deposits and investments |  |                       | 18,491  |  |                       |  | 65,938  | 
|Derivative financial instruments  |  |                       | 2,702   |  |                       |  | 148     | 
|                                  |  |                       | 439,589 |  |                       |  | 385,447 | 

The maximum exposure to credit risk for total trade receivables at the reporting date by geographic region was:



|       |  |                       |        |  |                       |  |        | 
|------ |  | --------------------- | ------ |  | --------------------- |  | ------ | 
|       |  | 28 December 2012$000 |        |  | 30 December 2011$000 | 
|Europe |  |                       | 11,597 |  |                       |  | 6,083  | 
|USA    |  |                       | 11,202 |  |                       |  | 9,079  | 
|Asia   |  |                       | 70,177 |  |                       |  | 78,149 | 
|Other  |  |                       | 1,953  |  |                       |  | 5,177  | 
|       |  |                       | 94,929 |  |                       |  | 98,488 | 

The Groups exposure to credit risk is spread over a number of counterparties and customers with limited concentrations.



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Financial statements

Notes to the consolidated financial statements continued



The Groups largest customer accounts for $7.9 million of trade receivables at 28 December 2012 (30 December 2011: $8.7 million).

Impairment Losses

The aging of total trade receivables at the reporting date was:



|                            |  |                            |        |  |                                 |  |      |                            |  |  |                                 |  |  |  |      |  
|--------------------------- |  | -------------------------- | ------ |  | ------------------------------- |  | ---- | -------------------------- |  |  | ------------------------------- |  |  |  | ---- | -
|                            |  | Gross28 December 2012$000 |        |  | Impairment28 December 2012$000 |  |      | Gross30 December 2011$000 |  |  | Impairment30 December 2011$000 | 
|Not past due                |  |                            | 91,839 |  |                                 |  | (516 | )                          |  |  | 89,082                          |  |  |  | (200 | )
|Past due 1  30 days        |  |                            | 2,969  |  |                                 |  | (175 | )                          |  |  | 8,051                           |  |  |  | (200 | )
|Past due 31  60 days       |  |                            | 432    |  |                                 |  |     |                            |  |  | 1,199                           |  |  |  |     |  
|Past due 61  90 days       |  |                            | 160    |  |                                 |  | (28  | )                          |  |  | 248                             |  |  |  |     |  
|Past due 91  120 days      |  |                            | 9      |  |                                 |  |     |                            |  |  | 85                              |  |  |  |     |  
|More than 121 days past due |  |                            | 319    |  |                                 |  | (80  | )                          |  |  | 379                             |  |  |  | (156 | )
|                            |  |                            | 95,728 |  |                                 |  | (799 | )                          |  |  | 99,044                          |  |  |  | (556 | )

The movement in the allowances in respect of trade receivables during the period was as follows:



|                                       |  |                       |        |   |                       |  |        |  
|-------------------------------------- |  | --------------------- | ------ | - | --------------------- |  | ------ | -
|                                       |  | 28 December 2012$000 |        |   | 30 December 2011$000 | 
|Balance at the beginning of the period |  |                       | 556    |   |                       |  | 450    |  
|Utilised in the period                 |  |                       | (2,852 | ) |                       |  | (1,366 | )
|Additional provisions in the period    |  |                       | 3,095  |   |                       |  | 1,472  |  
|Balance at the end of the period       |  |                       | 799    |   |                       |  | 556    |  

Included in the Groups trade receivables balance are debtors with a carrying amount of $3.6 million (2011: $9.6 million) which
are past due but for which the Group has not provided, as there has been no significant change in the credit quality of the receivables and the amounts are still considered recoverable. $2.8 million of the past due but not provided trade receivables
were received within two weeks of the balance sheet date (2011: $6.8 million).

Based on past experience, the Group believes that no impairment allowance
is necessary in respect of trade receivables not past due, other than for credit notes or price adjustments.

23. Derivative Financial
Instruments

Currency Derivatives

The
Group utilises currency derivatives to hedge significant future transactions and cash flows. The instruments purchased are denominated in GBP.

At the
balance sheet date, the total notional amount of outstanding forward foreign exchange contracts, designated in hedging relationships, that the Group has committed is as below:



|                                   |  |                       |         |  |                       |  |         | 
|---------------------------------- |  | --------------------- | ------- |  | --------------------- |  | ------- | 
|                                   |  | 28 December 2012$000 |         |  | 30 December 2011$000 | 
|Forward foreign exchange contracts |  |                       | 100,641 |  |                       |  | 107,631 | 

These arrangements are designed to address significant exchange exposures for the next 12 months (2011: 15 months) and are renewed
on a rolling basis to cover between 11 and 15 months forward.

At the balance sheet date, the fair value of the Groups currency derivatives is
shown below:

Derivatives that are designated and effective as hedging instruments carried at fair value



|                                   |  |                       |       |  |                       |  |        |  
|---------------------------------- |  | --------------------- | ----- |  | --------------------- |  | ------ | -
|                                   |  | 28 December 2012$000 |       |  | 30 December 2011$000 | 
|Forward foreign exchange contracts |  |                       |       |  |                       |  |        |  
|Assets                             |  |                       | 2,496 |  |                       |  | 148    |  
|Liabilities                        |  |                       |      |  |                       |  | (1,550 | )
|                                   |  |                       | 2,496 |  |                       |  | (1,402 | )

The fair value of currency derivatives that are designated and effective as cash flow hedges amounting to a net asset of $2,496,000
(2011: net liability of $1,402,000) has been deferred in equity.

Net amounts of $49,000 (2011: $4,020,000; 2010: $1,231,000;) and $991,000 (2011:
$165,000; 2010: $85,000;) respectively have been transferred to operating expenses in the income statement and fixed assets in respect of contracts maturing in the period.



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Financial statements



Financial assets/liabilities Carried at Fair Value Through Profit or
Loss (FVTPL)



|                                   |  |                       |     |  |                       |  |     |  
|---------------------------------- |  | --------------------- | --- |  | --------------------- |  | --- | -
|                                   |  | 28 December 2012$000 |     |  | 30 December 2011$000 | 
|Forward foreign exchange contracts |  |                       | 206 |  |                       |  | (35 | )

Further details of derivative financial instruments are given in note 36.

24. Deferred Tax

The following are the major deferred tax assets and liabilities recognised by the
Group and movements thereon during the period and prior reporting period:



|                                       |  |                                  |       |   |                         |  |       |                  |  |  |                              |   |  |                         |         |   |                                           |  |      |            |  |  |        |   |  |  |         |  
|-------------------------------------- |  | -------------------------------- | ----- | - | ----------------------- |  | ----- | ---------------- |  |  | ---------------------------- | - |  | ----------------------- | ------- | - | ----------------------------------------- |  | ---- | ---------- |  |  | ------ | - |  |  | ------- | -
|                                       |  | Property,plant andequipment$000 |       |   | Share-basedpayment$000 |  |       | Intangibles$000 |  |  | Taxlossesand R&Dcredits$000 |   |  | Hedgingdifferences$000 |         |   | Other short-termtemporarydifferences$000 |  |      | Total$000 | 
|At 31 December 2010                    |  |                                  | 903   |   |                         |  | 1,764 |                  |  |  | (8,088                       | ) |  |                         | 33,230  |   |                                           |  | (304 | )          |  |  | 611    |   |  |  | 28,116  |  
|Credit (charge) to income              |  |                                  | 8,229 |   |                         |  | (528  | )                |  |  | 5,990                        |   |  |                         | 52,403  |   |                                           |  |     |            |  |  | 25,393 |   |  |  | 91,487  |  
|(Charge) credit to equity              |  |                                  |      |   |                         |  | (645  | )                |  |  |                             |   |  |                         | 162     |   |                                           |  |     |            |  |  |       |   |  |  | (483    | )
|Credit to other comprehensive income   |  |                                  |      |   |                         |  |      |                  |  |  |                             |   |  |                         |        |   |                                           |  | 653  |            |  |  |       |   |  |  | 653     |  
|Acquisition of subsidiary              |  |                                  | 24    |   |                         |  |      |                  |  |  | (28,506                      | ) |  |                         | 27,680  |   |                                           |  |     |            |  |  | 1,380  |   |  |  | 578     |  
|Effect of change in tax rate  equity  |  |                                  |      |   |                         |  | 37    |                  |  |  |                             |   |  |                         | (114    | ) |                                           |  | 11   |            |  |  |       |   |  |  | (66     | )
|Effect of change in tax rate  income  |  |                                  | (462  | ) |                         |  | 30    |                  |  |  | 702                          |   |  |                         | (2,065  | ) |                                           |  |     |            |  |  | (48    | ) |  |  | (1,843  | )
|At 30 December 2011                    |  |                                  | 8,694 |   |                         |  | 658   |                  |  |  | (29,902                      | ) |  |                         | 111,296 |   |                                           |  | 360  |            |  |  | 27,336 |   |  |  | 118,442 |  
|(Charge) credit to income              |  |                                  | (264  | ) |                         |  | 1,673 |                  |  |  | 6,055                        |   |  |                         | (34,918 | ) |                                           |  |     |            |  |  | (4,916 | ) |  |  | (32,370 | )
|Credit to equity                       |  |                                  |      |   |                         |  | 573   |                  |  |  |                             |   |  |                         | 436     |   |                                           |  |     |            |  |  |       |   |  |  | 1,009   |  
|(Charge) to other comprehensive income |  |                                  |      |   |                         |  |      |                  |  |  |                             |   |  |                         |        |   |                                           |  | (957 | )          |  |  |       |   |  |  | (957    | )
|Effect of change in tax rate  equity  |  |                                  |      |   |                         |  | (35   | )                |  |  |                             |   |  |                         |        |   |                                           |  | 30   |            |  |  |       |   |  |  | (5      | )
|Effect of change in tax rate  income  |  |                                  | (683  | ) |                         |  | (155  | )                |  |  | 2,964                        |   |  |                         | (5,591  | ) |                                           |  |     |            |  |  | 1,648  |   |  |  | (1,817  | )
|At 28 December 2012                    |  |                                  | 7,747 |   |                         |  | 2,714 |                  |  |  | (20,883                      | ) |  |                         | 71,223  |   |                                           |  | (567 | )          |  |  | 24,068 |   |  |  | 84,302  |  

Certain deferred tax assets and liabilities have been offset where they relate to the same taxation authority and net settlement and
offset is permitted. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:



|                         |  |                       |        |   |                       |  |         | 
|------------------------ |  | --------------------- | ------ | - | --------------------- |  | ------- | 
|                         |  | 28 December 2012$000 |        |   | 30 December 2011$000 | 
|Deferred tax assets      |  |                       | 89,193 |   |                       |  | 118,442 | 
|Deferred tax liabilities |  |                       | (4,891 | ) |                       |  |        | 
|                         |  |                       | 84,302 |   |                       |  | 118,442 | 

At the balance sheet date, the Group has unused tax losses of $539,850,605 (2011: $551,303,822) and unused tax credits of
$33,945,792 (2011: $54,549,718) available for offset against future profits. A deferred tax asset has been recognised in respect of $220,215,473 (2011: $366,179,161) of the tax losses and $8,491,641 of tax credits (2011:$nil). No deferred tax asset
has been recognised in respect of the remaining unused tax losses of $319,635,132 (2011: $185,124,661) and unused tax credits of $25,454,151 (2011: $54,549,718) due to either a history of tax losses or it is not considered probable that there will
be sufficient future taxable profits to realise the benefit of deferred tax assets within certain subsidiary entities. Included in unrecognised tax losses and unrecognised tax credits are tax losses of $72,278,400 (2011: $21,179,182) and tax credits
of $25,454,151 (2011: $54,549,718) that will expire in 5-19 years. Other losses may be carried forward indefinitely.

At the balance sheet date, no
deferred tax liability has been recognised on temporary differences of $31,784,663 (2011: $31,955,166) relating to the unremitted earnings of overseas subsidiaries as the Group is able to control the timing of the reversal of these temporary
differences and it is probable that they will not reverse in the foreseeable future. The temporary differences at 28 December 2012 represent only the unremitted earnings of those overseas subsidiaries where remittance to the UK of those
earnings may still result in a tax liability, principally as a result of dividend withholding taxes levied by the overseas tax jurisdictions in which those subsidiaries operate.

The recognition of the deferred tax asset is based on managements assessment of historic profitability, forecasted operating results based upon approved business plans and a review of the tax planning
opportunities. Based on this, management concluded that there is convincing evidence for the recognition of deferred tax assets in excess of the deferred tax liability by $21,318,597, in entities that have suffered a loss in the current or preceding
periods.



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Financial statements

Notes to the consolidated financial statements continued



25. Obligations Under Finance Leases



|                                                                                   |  |                        |       |  |                                         |  |     |                       |  |  |                       |   |  |  |     |  
|---------------------------------------------------------------------------------- |  | ---------------------- | ----- |  | --------------------------------------- |  | --- | --------------------- |  |  | --------------------- | - |  |  | --- | -
|                                                                                   |  | Minimum lease payments |       |  | Present value of minimum lease payments | 
|                                                                                   |  | 28 December 2012$000  |       |  | 30 December 2011$000                   |  |     | 28 December 2012$000 |  |  | 30 December 2011$000 |  
|Amounts payable under finance leases:                                              |  |                        |       |  |                                         |  |     |                       |  |  |                       |   |  |  |     |  
|Within one year                                                                    |  |                        | 1,393 |  |                                         |  | 16  |                       |  |  | 1,393                 |   |  |  | 16  |  
|In the second to fifth years inclusive                                             |  |                        | 170   |  |                                         |  | 143 |                       |  |  | 170                   |   |  |  | 143 |  
|                                                                                   |  |                        | 1,563 |  |                                         |  | 159 |                       |  |  | 1,563                 |   |  |  | 159 |  
|Less: future finance charges                                                       |  |                        |      |  |                                         |  |    |                       |  |  |                      |   |  |  |    |  
|Present value of lease                                                             |  |                        | 1,563 |  |                                         |  | 159 |                       |  |  | 1,563                 |   |  |  | 159 |  
|Less: Amount due for settlement within 12 months (shown under current
liabilities) |  |                        |       |  |                                         |  |     |                       |  |  | (1,393                | ) |  |  | (16 | )
|Amount due for settlement after 12 months                                          |  |                        |       |  |                                         |  |     |                       |  |  | 170                   |   |  |  | 143 |  

It is the Groups policy to lease certain of its equipment under finance leases and purchase certain software licences under
agreements containing deferred payment terms. The average lease term is 3.0 years (2011: 3.0 years). Interest rates are fixed at the contract date; all of the agreements containing deferred payment terms are interest free. For the period ended
28 December 2012, the average effective borrowing rate was 0% (2011: 0%). All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

Lease obligations with a present value of $1,226,000 (2011: $123,000) are denominated in Sterling. All other obligations are denominated in either Japanese Yen or
US Dollars.

The Groups obligations under finance leases are secured by the lessors right over the leased assets.

26. Other Financial Liabilities

Trade and Other Payables



|                                                                              |  |                       |         |  |                       |  |         | 
|----------------------------------------------------------------------------- |  | --------------------- | ------- |  | --------------------- |  | ------- | 
|                                                                              |  | 28 December 2012$000 |         |  | 30 December 2011$000 | 
|Trade creditors                                                               |  |                       | 65,911  |  |                       |  | 74,023  | 
|Other taxation and social security                                            |  |                       | 7,007   |  |                       |  | 2,489   | 
|Other payables                                                                |  |                       | 1,693   |  |                       |  | 937     | 
|Inventory accruals                                                            |  |                       | 12,948  |  |                       |  | 9,036   | 
|Other accruals and deferred income                                            |  |                       | 176,064 |  |                       |  | 143,726 | 
|                                                                              |  |                       | 263,623 |  |                       |  | 230,211 | 
|                                                                              |  |                      
|Analysed as:                                                                  |  | 28 December 2012$000 |         |  | 30 December 2011$000 | 
|Amounts due for settlement within 12 months (shown under current liabilities) |  |                       | 227,777 |  |                       |  | 180,621 | 
|Amounts due for settlement after 12 months                                    |  |                       | 35,846  |  |                       |  | 49,590  | 
|                                                                              |  |                       | 263,623 |  |                       |  | 230,211 | 

Trade creditors and accruals principally comprise amounts outstanding for trade purchases and ongoing costs. The average credit
period taken for trade purchases is 44 days (2011: 48 days).

The directors consider that the carrying amount of trade and other payables approximates to
their fair value.

For most suppliers, no interest is charged on trade payables. The Group has financial risk management policies in place to ensure that
all payables are paid within the credit time-frame.



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|CSR plc Annual Report and Financial Statements
2012 |  | 



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##### Table of Contents

Financial statements



27. Provisions



|                                   |  |                             |        |   |                                   |  |        |                          |  |  |                             |   |  |            |         |   |  |  |         |  
|---------------------------------- |  | --------------------------- | ------ | - | --------------------------------- |  | ------ | ------------------------ |  |  | --------------------------- | - |  | ---------- | ------- | - |  |  | ------- | -
|                                   |  | Onerous leaseprovision$000 |        |   | Returns andwarrantyprovision$000 |  |        | Litigationprovision$000 |  |  | Restructuringprovision$000 |   |  | Total$000 |        
|At 31 December 2010                |  |                             | 3,090  |   |                                   |  | 3,995  |                          |  |  |                            |   |  |            |        |   |  |  | 7,085   |  
|Additional provision in the period |  |                             | 72     |   |                                   |  | 3,219  |                          |  |  |                            |   |  |            | 21,683  |   |  |  | 24,974  |  
|Unwinding of discount              |  |                             | 252    |   |                                   |  |       |                          |  |  |                            |   |  |            |        |   |  |  | 252     |  
|On acquisition of subsidiary       |  |                             | 1,337  |   |                                   |  |       |                          |  |  | 11,986                      |   |  |            | 10,951  |   |  |  | 24,274  |  
|Utilised in period                 |  |                             | (1,533 | ) |                                   |  | (2,674 | )                        |  |  | (686                        | ) |  |            | (20,271 | ) |  |  | (25,164 | )
|At 30 December 2011                |  |                             | 3,218  |   |                                   |  | 4,540  |                          |  |  | 11,300                      |   |  |            | 12,363  |   |  |  | 31,421  |  
|Additional provision in the period |  |                             | 3,656  |   |                                   |  | 3,552  |                          |  |  | 8,000                       |   |  |            | 1,876   |   |  |  | 17,084  |  
|Unwinding of discount              |  |                             | 255    |   |                                   |  |       |                          |  |  |                            |   |  |            |        |   |  |  | 255     |  
|Released in the period             |  |                             | (1,103 | ) |                                   |  |       |                          |  |  |                            |   |  |            |        |   |  |  | (1,103  | )
|Utilised in period                 |  |                             | (1,393 | ) |                                   |  | (2,340 | )                        |  |  | (9,412                      | ) |  |            | (13,375 | ) |  |  | (26,520 | )
|At 28 December 2012                |  |                             | 4,633  |   |                                   |  | 5,752  |                          |  |  | 9,888                       |   |  |            | 864     |   |  |  | 21,137  |  



|                                                |  |                       |        |  |                       |  |        | 
|----------------------------------------------- |  | --------------------- | ------ |  | --------------------- |  | ------ | 
|                                                |  | 28 December 2012$000 |        |  | 30 December 2011$000 | 
|Amounts included within current liabilities     |  |                       | 16,742 |  |                       |  | 29,495 | 
|Amounts included within non-current liabilities |  |                       | 4,395  |  |                       |  | 1,926  | 
|                                                |  |                       | 21,137 |  |                       |  | 31,421 | 

Onerous Lease Provision

The Group has provided for the discounted anticipated costs of satisfying the terms of any onerous leases, less any anticipated income from subletting the buildings. It is anticipated that the provisions will be
used over the remaining lease terms. Discount rates have been applied with reference to the rates on government bonds, with maturities corresponding to the remaining lease terms, which prevail in the jurisdiction of the lease.

Returns and Warranty Provision

The Group provides
for the anticipated costs associated with contractual liabilities under standard warranty terms. It is anticipated that the provision will be utilised within one year (see note 3).

Litigation Provision

Through the acquisition of Zoran Corporation, the group assumed the obligation
to meet any liabilities that may arise as a consequence of continuing SEC investigations of former executives of Microtune Inc., a subsidiary undertaking. The investigations were still ongoing at the balance sheet date and it is uncertain when the
provision will be utilised.

Restructuring Provision

A restructuring programme was implemented in the prior period, following the acquisition of Zoran Corporation. In December 2011, a decision was taken to discontinue investment in the digital television and silicon
tuners business lines which had been acquired with Zoran and a further restructuring programme commenced.

As at 30 December 2011, approximately 30%
of the 800 affected employees had left the Groups employment and a further 20% left on 31 December 2011. The remainder of the affected employees had left the Groups employment during the period ended 28 December 2012, however
there are further anticipated costs that have yet to be utilised.

28. Called-up Share Capital

Company

Authorised Share Capital



|                                                                                    |  |                        |     |  |                        |  |     | 
|----------------------------------------------------------------------------------- |  | ---------------------- | --- |  | ---------------------- |  | --- | 
|                                                                                    |  | 28 December 2012
£000 |     |  | 30 December 2011
£000 | 
|350,000,000 (30 December 2011: 350,000,000) Ordinary Shares of £0.001 each
 equity |  |                        | 350 |  |                        |  | 350 | 
|Allotted, Called-up and Fully Paid:                                                 |  |                        |     |  |                        |  |     | 
|                                                                                    |  |                       
|                                                                                    |  | 28 December 2012
$000 |     |  | 30 December 2011
$000 | 
|181,896,339 (30 December 2011: 215,667,851) Ordinary Shares of £0.001 each
 equity |  |                        | 317 |  |                        |  | 372 | 

Changes to Share Capital:

Equity Shares:

5,383,876 Ordinary Shares were issued from employee option exercises between
31 December 2011 and 28 December 2012. Consideration was $14,258,091 at a premium of $14,249,586.

9,925,000 ordinary shares were issued on
5 October 2012 and admitted to trading on the London Stock Exchange. These shares represented an equity investment on the part of Samsung, which was completed on the same date as the disposal of the Groups handset connectivity and
location development operations, also to Samsung. Consideration was $34,407,990 at a premium of $34,392,560.

On 30 November 2012, 49,080,388
ordinary shares (including ordinary shares represented by ADSs) were accepted for purchase by J.P.Morgan Cazenove. Under the terms of the tender offer, on 30 November 2012, CSR plc repurchased all 49,080,388 ordinary shares from J.P. Morgan
Cazenove. CSR plc cancelled 49,080,388 ordinary shares on 30 November 2012. The consideration for the cancelled shares was $284,277,959 at a premium of $284,198,993.



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##### Table of Contents

Financial statements

Notes to the consolidated financial statements continued



The Company has one class of ordinary shares which carries no right to fixed income.

The following options and share
awards over Ordinary Shares of £0.001 have been granted and were outstanding at the end of the period:



|                                    |  |                                                 |           |  |                           |  |          |               |  |  |         |  
|----------------------------------- |  | ----------------------------------------------- | --------- |  | ------------------------- |  | -------- | ------------- |  |  | ------- | -
|Grant date                          |  | Number of sharessubject to option orshare award |           |  | Exercise priceper share £ |  |          | Vestingperiod | 
|25 November 2002 to 1 November 2003 |  |                                                 | 7,000     |  |                           |  | 1.01000  |               |  |  | 5 years |  
|18 November 2003 to 2 February 2004 |  |                                                 | 10,370    |  |                           |  | 1.02500  |               |  |  | 5 years |  
|26 February 2004                    |  |                                                 | 73,000    |  |                           |  | 2.35000  |               |  |  | 3 years |  
|26 February 2004                    |  |                                                 | 13,230    |  |                           |  | 2.35000  |               |  |  | 3 years | 2
|26 February 2004                    |  |                                                 | 28,900    |  |                           |  | 2.00000  |               |  |  | 3 years |  
|26 February 2004                    |  |                                                 | 76,770    |  |                           |  | 2.00000  |               |  |  | 3 years | 2
|30 September 2004                   |  |                                                 | 15,000    |  |                           |  | 3.62500  |               |  |  | 3 years | 2
|05 May 2005                         |  |                                                 | 109,300   |  |                           |  | 3.21000  |               |  |  | 3 years | 2
|05 May 2005                         |  |                                                 | 21,400    |  |                           |  | 0.00100  |               |  |  | 3 years |  
|05 May 2005                         |  |                                                 | 8,627     |  |                           |  | 0.00100  |               |  |  | 3 years | 1
|01 March 2006                       |  |                                                 | 25,000    |  |                           |  | 9.05000  |               |  |  | 3 years |  
|25 May 2006                         |  |                                                 | 334,220   |  |                           |  | 12.41000 |               |  |  | 5 years |  
|25 May 2006                         |  |                                                 | 5,580     |  |                           |  | 0.00100  |               |  |  | 3 years |  
|02 August 2006                      |  |                                                 | 18,422    |  |                           |  | 11.09670 |               |  |  | 5 years |  
|15 November 2006                    |  |                                                 | 70,294    |  |                           |  | 6.27000  |               |  |  | 5 years |  
|28 February 2007                    |  |                                                 | 30,621    |  |                           |  | 7.68000  |               |  |  | 5 years |  
|09 May 2007                         |  |                                                 | 29,695    |  |                           |  | 7.57000  |               |  |  | 5 years |  
|05 June 2007                        |  |                                                 | 18,914    |  |                           |  | 0.00100  |               |  |  | 3 years |  
|01 August 2007                      |  |                                                 | 39,303    |  |                           |  | 7.29000  |               |  |  | 5 years |  
|14 November 2007                    |  |                                                 | 68,819    |  |                           |  | 6.44500  |               |  |  | 5 years |  
|05 March 2008                       |  |                                                 | 40,776    |  |                           |  | 3.16000  |               |  |  | 5 years |  
|11 June 2008                        |  |                                                 | 18,605    |  |                           |  | 3.11000  |               |  |  | 3 years | 2
|11 June 2008                        |  |                                                 | 52,439    |  |                           |  | 0.00100  |               |  |  | 3 years |  
|11 June 2008                        |  |                                                 | 41,178    |  |                           |  | 0.00100  |               |  |  | 2 years |  
|04 November 2008                    |  |                                                 | 8,331     |  |                           |  | 0.00100  |               |  |  | 2 years |  
|04 November 2008                    |  |                                                 | 4,646     |  |                           |  | 2.04500  |               |  |  | 3 years |  
|26 June 2009                        |  |                                                 | 1,634,417 |  |                           |  | Various  |               |  |  | Various |  
|15 March 2010                       |  |                                                 | 596,690   |  |                           |  | 0.00100  |               |  |  | 3 years | 2
|15 March 2010                       |  |                                                 | 474,733   |  |                           |  | 4.84300  |               |  |  | 3 years | 1
|15 March 2010                       |  |                                                 | 352,842   |  |                           |  | 0.00100  |               |  |  | 3 years |  
|15 March 2010                       |  |                                                 | 17,643    |  |                           |  | 4.84300  |               |  |  | 3 years |  
|01 May 2010                         |  |                                                 | 18,959    |  |                           |  | 3.91250  |               |  |  | 3 years | 3
|13 May 2010                         |  |                                                 | 8,000     |  |                           |  | 0.00100  |               |  |  | 3 years | 2
|13 May 2010                         |  |                                                 | 9,200     |  |                           |  | 0.00100  |               |  |  | 3 years |  
|03 September 2010                   |  |                                                 | 65,757    |  |                           |  | 2.99800  |               |  |  | 3 years | 2
|03 September 2010                   |  |                                                 | 50,299    |  |                           |  | 0.00100  |               |  |  | 3 years |  
|03 September 2010                   |  |                                                 | 60,750    |  |                           |  | 0.00100  |               |  |  | 3 years | 2
|15 March 2011                       |  |                                                 | 173,250   |  |                           |  | 0.00100  |               |  |  | 2 years |  
|15 March 2011                       |  |                                                 | 1,482,915 |  |                           |  | 0.00100  |               |  |  | 3 years |  
|15 March 2011                       |  |                                                 | 113,577   |  |                           |  | 3.78500  |               |  |  | 3 years |  
|1 May 2011                          |  |                                                 | 107,031   |  |                           |  | 3.04800  |               |  |  | 3 years | 3
|31 August 2011                      |  |                                                 | 125,374   |  |                           |  | 0.00100  |               |  |  | Various |  
|31 August 2011                      |  |                                                 | 1,224,424 |  |                           |  | 0.00100  |               |  |  | Various | 5
|31 August 2011                      |  |                                                 | 56,537    |  |                           |  | Various  |               |  |  | Various |  
|31 August 2011                      |  |                                                 | 7,891,456 |  |                           |  | Various  |               |  |  | Various |  
|6 September 2011                    |  |                                                 | 178,468   |  |                           |  | 0.00100  |               |  |  | 2 years |  
|6 September 2011                    |  |                                                 | 129,345   |  |                           |  | 2.14000  |               |  |  | 3 years |  
|6 September 2011                    |  |                                                 | 1,759,105 |  |                           |  | 2.14000  |               |  |  | 3 years | 4
|16 December 2011                    |  |                                                 | 242,651   |  |                           |  | 0.00100  |               |  |  | 2 years |  
|16 December 2011                    |  |                                                 | 643,429   |  |                           |  | 1.90700  |               |  |  | 3 years |  
|21 March 2012                       |  |                                                 | 2,148,641 |  |                           |  | 0.00100  |               |  |  | 3 years |  
|21 March 2012                       |  |                                                 | 1,896,477 |  |                           |  | 2.47500  |               |  |  | 3 years | 4
|21 March 2012                       |  |                                                 | 99,626    |  |                           |  | 0.00100  |               |  |  | Various | 1



|                                                    |  | 
|--------------------------------------------------- |  | 
|CSR plc Annual Report and Financial Statements
2012 |  | 



---

##### Table of Contents

Financial statements



|                |  |                                                 |            |  |                           |  |         |               |  |  |         |  
|--------------- |  | ----------------------------------------------- | ---------- |  | ------------------------- |  | ------- | ------------- |  |  | ------- | -
|Grant date      |  | Number of sharessubject to option orshare award |            |  | Exercise priceper share £ |  |         | Vestingperiod | 
|21 March 2012   |  |                                                 | 45,101     |  |                           |  | 2.47500 |               |  |  | 3 years |  
|21 March 2012   |  |                                                 | 245,462    |  |                           |  | 0.00100 |               |  |  | 3 years | 6
|29 March 2012   |  |                                                 | 11,275     |  |                           |  | 0.00100 |               |  |  | 3 years |  
|1 May 2012      |  |                                                 | 902,011    |  |                           |  | 2.00800 |               |  |  | 3 years |  
|21 August 2012  |  |                                                 | 165,674    |  |                           |  | 0.00100 |               |  |  | 2 years |  
|21 August 2012  |  |                                                 | 103,406    |  |                           |  | 3.26000 |               |  |  | 3 years |  
|21 August 2012  |  |                                                 | 103,840    |  |                           |  | 0.00100 |               |  |  | Various |  
|25 October 2012 |  |                                                 | 1,430,429  |  |                           |  | 0.00100 |               |  |  | Various |  
|25 October 2012 |  |                                                 | 66,253     |  |                           |  | 0.00100 |               |  |  | 2 years |  
|25 October 2012 |  |                                                 | 34,604     |  |                           |  | 3.36500 |               |  |  | 3 years |  
|                |  |                                                 | 25,840,091 |  |                           |  |         |               |  |  |         |  



|1 | These options or awards have vesting conditions based on the Companys performance against comparator companies based on TSR rankings over the vesting
period.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

|2 | These options or awards have vesting conditions based on EPS growth over the vesting period.
|- | --------------------------------------------------------------------------------------------

|3 | These options have been issued as part of the Companys SAYE scheme.
|- | --------------------------------------------------------------------

|4 | These options have vesting conditions based on the growth of the Companys share price over the vesting period.
|- | ---------------------------------------------------------------------------------------------------------------

|5 | The obligation for these options was assumed as a result of the acquisition of Zoran Corporation. Outstanding share options for non-European employees of Zoran
Corporation were converted to options to acquire American depositary shares of CSR (or CSR ADSs) and outstanding Restricted Stock Units were converted to CSR Contingent Share Awards that can be settled in CSR ADSs. Each CSR ADS
represents four CSR ordinary shares.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6 | These awards have been issued as part of the Companys Executive Incentive Plan.
|- | --------------------------------------------------------------------------------

Exercise period: Vested options and share awards are exercisable within ten years from the grant date, SAYE options are exercisable within 6 months of the vesting date.



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##### Table of Contents

Financial statements

Notes to the consolidated financial statements continued



29. Reserves



|                                                                                 |  |                          |         |  |                               |  |       |                    |  |  |                                  |  |  |                     |         |   |                                 |  |        |                 |  |  |                     |  |  |                       |        |   |            |  |         |   |  |  |          |   |  |  |          |  
|-------------------------------------------------------------------------------- |  | ------------------------ | ------- |  | ----------------------------- |  | ----- | ------------------ |  |  | -------------------------------- |  |  | ------------------- | ------- | - | ------------------------------- |  | ------ | --------------- |  |  | ------------------- |  |  | --------------------- | ------ | - | ---------- |  | ------- | - |  |  | -------- | - |  |  | -------- | -
|                                                                                 |  | Sharepremiumaccount$000 |         |  | Capitalredemptionreserve$000 |  |       | Mergerreserve$000 |  |  | EmployeeBenefitTrustreserve$000 |  |  | Hedgingreserve$000 |         |   | Share -basedpaymentreserve$000 |  |        | Taxreserve$000 |  |  | Treasuryshares$000 |  |  | Retainedearnings$000 |        |   | Total$000 | 
|At 31 December 2010                                                              |  |                          | 368,615 |  |                               |  | 950   |                    |  |  | 61,574                           |  |  |                     | (39,064 | ) |                                 |  | 1,123  |                 |  |  | 58,038              |  |  |                       | 41,641 |   |            |  | (37,487 | ) |  |  | 318,852  |   |  |  | 774,242  |  
|Share issues (net of share issue costs)                                          |  |                          | 104,847 |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 104,847  |  
|Shares issued from Employee Benefit Trust Reserve                                |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     | 5,093   |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (4,134   | ) |  |  | 959      |  
|Credit to equity for equity-settled share-based payments                         |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  | 13,583              |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 13,583   |  
|Credit to equity for equity-settled share-based payments arising on acquisition  |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  | 16,576              |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 16,576   |  
|Purchase of Treasury Shares                                                      |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  | (47,173 | ) |  |  |         |   |  |  | (47,173  | )
|Effective rate adjustment                                                        |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | (66    | ) |            |  |        |   |  |  |         |   |  |  | (66      | )
|Deferred tax on share-based payment transactions                                 |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | (645   | ) |            |  |        |   |  |  |         |   |  |  | (645     | )
|Gain on cash flow hedges                                                         |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  | 1,661  |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 1,661    |  
|Deferred tax on hedging reserve                                                  |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | 653    |   |            |  |        |   |  |  |         |   |  |  | 653      |  
|Transferred to income statement in respect of cash flow hedges                   |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  | (4,184 | )               |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | (4,184   | )
|Current tax benefit taken directly to equity on share option gains               |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | (162   | ) |            |  |        |   |  |  |         |   |  |  | (162     | )
|Credit to equity on recognition of losses                                        |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | 162    |   |            |  |        |   |  |  |         |   |  |  | 162      |  
|Actuarial losses on defined benefit pension deficit                              |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (435     | ) |  |  | (435     | )
|Profit for the period                                                            |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | 33,866   |   |  |  | 33,866   |  
|Equity dividends issued to shareholders                                          |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (16,349  | ) |  |  | (16,349  | )
|At 30 December 2011                                                              |  |                          | 473,462 |  |                               |  | 950   |                    |  |  | 61,574                           |  |  |                     | (33,971 | ) |                                 |  | (1,400 | )               |  |  | 88,197              |  |  |                       | 41,583 |   |            |  | (84,660 | ) |  |  | 331,800  |   |  |  | 877,535  |  
|Share issues (net of share issue costs)                                          |  |                          | 48,642  |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 48,642   |  
|Repurchase and cancellation of ordinary shares under tender offer (net of costs) |  |                          |        |  |                               |  | 79    |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (284,278 | ) |  |  | (284,199 | )
|Share issue costs                                                                |  |                          | 1,550   |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (1,839   | ) |  |  | (289     | )
|Shares issued from Employee Benefit Trust Reserve                                |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     | 14,808  |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (13,158  | ) |  |  | 1,650    |  
|Shares issued from Treasury                                                      |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  | 7,203   |   |  |  | (3,268   | ) |  |  | 3,935    |  
|Purchase of Treasury Shares                                                      |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  | (9,472  | ) |  |  |         |   |  |  | (9,472   | )
|Credit to equity for equity-settled share-based payments                         |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  | 24,480              |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 24,480   |  
|Gain on cash flow hedges                                                         |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  | 4,935  |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | 4,935    |  
|Deferred tax on hedging reserve                                                  |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | (957   | ) |            |  |        |   |  |  |         |   |  |  | (957     | )
|Transferred to income statement in respect of cash flow hedges                   |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  | (1,040 | )               |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  |         |   |  |  | (1,040   | )
|Effective rate adjustment                                                        |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | (5     | ) |            |  |        |   |  |  |         |   |  |  | (5       | )
|Credit to equity on recognition of losses                                        |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | 436    |   |            |  |        |   |  |  |         |   |  |  | 436      |  
|Deferred tax on share-based payment transactions                                 |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       | 573    |   |            |  |        |   |  |  |         |   |  |  | 573      |  
|Actuarial losses on defined benefit pension deficit                              |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (919     | ) |  |  | (919     | )
|Scheme assets above the threshold                                                |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (656     | ) |  |  | (656     | )
|Profit for the period                                                            |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | 51,233   |   |  |  | 51,233   |  
|Equity dividends issued to shareholders                                          |  |                          |        |  |                               |  |      |                    |  |  |                                 |  |  |                     |        |   |                                 |  |       |                 |  |  |                    |  |  |                       |       |   |            |  |        |   |  |  | (21,265  | ) |  |  | (21,265  | )
|At 28 December 2012                                                              |  |                          | 523,654 |  |                               |  | 1,029 |                    |  |  | 61,574                           |  |  |                     | (19,163 | ) |                                 |  | 2,495  |                 |  |  | 112,677             |  |  |                       | 41,630 |   |            |  | (86,929 | ) |  |  | 57,650   |   |  |  | 694,617  |  

A tax reserve has been included to show movements in equity caused by tax adjustments reflecting movements in tax not recorded in
the income statement.

The share premium account, capital redemption reserve and hedging reserve are not distributable. The merger reserve arose on the
combination of CSR plc and Cambridge Silicon Radio Limited and is not distributable.

The Employee Benefit Trust Reserve represents the cost of shares in
CSR plc purchased in the market and held by the CSR plc Employee Benefit Trust to satisfy options under the Groups share option schemes. Between 18 March 2008 and 25 March 2008, the CSR Employee Benefit Trust (the Trust)
purchased 3,222,813 ordinary shares at prices between £3.37 and £3.03.

1,556,014 ordinary shares were issued from the Employee Benefit Trust
in 2012 to satisfy employee option exercises (2011: 729,031 ordinary shares).

The shares acquired by the Trust do not represent treasury shares for the
purposes of the Companies Act and therefore remain as issued share capital.

For accounting purposes, the treatment of the shares acquired by the Trust
is different. In preparing the consolidated Group accounts, the shares held by the Trust are treated as a deduction in shareholders equity.

At
28 December 2012, the Group had purchased 17,391,884 shares which are held in Treasury at a cost of $94.1 million.

1,336,885 ordinary shares were
issued from Treasury in 2012 to satisfy employee option exercises (2011: nil).



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Financial statements



30. Notes to Cash Flow Statement



|                                                         |  |                                     |          |   |                                     |  |         |                                     |  |  |         |  
|-------------------------------------------------------- |  | ----------------------------------- | -------- | - | ----------------------------------- |  | ------- | ----------------------------------- |  |  | ------- | -
|                                                         |  | 52 weeks ended28 December 2012$000 |          |   | 52 weeks ended30 December 2011$000 |  |         | 52 weeks ended31 December 2010$000 | 
|Net profit for the period                                |  |                                     | 51,233   |   |                                     |  | 33,866  |                                     |  |  | 16,626  |  
|Adjustments for:                                         |  |                                     |          |   |                                     |  |         |                                     |  |  |         |  
|Investment income                                        |  |                                     | (1,161   | ) |                                     |  | (1,627  | )                                   |  |  | (812    | )
|Finance costs                                            |  |                                     | 7,106    |   |                                     |  | 5,046   |                                     |  |  | 904     |  
|Other gains and losses                                   |  |                                     | (14      | ) |                                     |  | (320    | )                                   |  |  | (640    | )
|Income tax charge (credit)                               |  |                                     | 50,749   |   |                                     |  | (85,330 | )                                   |  |  | (22,331 | )
|Operating profit (loss)                                  |  |                                     | 107,913  |   |                                     |  | (48,365 | )                                   |  |  | (6,253  | )
|Depreciation of property, plant and equipment            |  |                                     | 16,171   |   |                                     |  | 18,371  |                                     |  |  | 20,091  |  
|Amortisation of intangible assets                        |  |                                     | 30,485   |   |                                     |  | 26,352  |                                     |  |  | 18,054  |  
|Loss on disposal of property, plant and equipment        |  |                                     | 916      |   |                                     |  | 62      |                                     |  |  | 279     |  
|Loss on disposal of intangible assets                    |  |                                     |         |   |                                     |  | 24      |                                     |  |  | 135     |  
|Share related charges                                    |  |                                     | 24,480   |   |                                     |  | 13,583  |                                     |  |  | 9,592   |  
|Impairment of assets                                     |  |                                     | 2,300    |   |                                     |  | 2,276   |                                     |  |  |        |  
|De-recognition of contingent consideration               |  |                                     |         |   |                                     |  | (1,620  | )                                   |  |  |        |  
|Profit on disposal of development operations             |  |                                     | (127,178 | ) |                                     |  |        |                                     |  |  |        |  
|(Decrease) increase in provisions                        |  |                                     | (13,284  | ) |                                     |  | (342    | )                                   |  |  | 2,227   |  
|Operating cash flows before movements in working capital |  |                                     | 41,803   |   |                                     |  | 10,341  |                                     |  |  | 44,125  |  
|Decrease (increase) in inventories                       |  |                                     | 32,497   |   |                                     |  | 27,788  |                                     |  |  | (12,961 | )
|Decrease (increase) in receivables                       |  |                                     | 6,635    |   |                                     |  | 27,322  |                                     |  |  | (6,678  | )
|(Decrease) increase in payables                          |  |                                     | (2,998   | ) |                                     |  | (49,298 | )                                   |  |  | 46,093  |  
|Cash generated by operations                             |  |                                     | 77,937   |   |                                     |  | 16,153  |                                     |  |  | 70,579  |  
|Foreign taxes paid                                       |  |                                     | (5,645   | ) |                                     |  | (3,063  | )                                   |  |  | (1,127  | )
|Corporation taxes received                               |  |                                     | 4,733    |   |                                     |  |        |                                     |  |  | 8,691   |  
|Grant income received                                    |  |                                     |         |   |                                     |  |        |                                     |  |  | 131     |  
|Interest paid                                            |  |                                     | (3,097   | ) |                                     |  | (450    | )                                   |  |  | (662    | )
|R&D tax credit received                                  |  |                                     |         |   |                                     |  |        |                                     |  |  | 295     |  
|Net cash from operating activities                       |  |                                     | 73,928   |   |                                     |  | 12,640  |                                     |  |  | 77,907  |  

Cash and cash equivalents (which are presented as a single class of asset on the face of the balance sheet) comprise cash at bank
and other short term highly liquid investments with an original maturity of three months or less.

The acquisition of Zoran Corporation in the 52 weeks
ended 30 December 2011 (see note 39) was a significant non cash transaction in the period as the consideration for the transaction was partly satisfied through the issuance of additional shares.

31. Contingent Liabilities

Intellectual property
litigation is commonplace in our industry and poses risks and uncertainties that may materially and adversely affect or disrupt our business, customer relationships, expenses or results of operations. We are regularly involved in pending and
threatened litigation in the course of our business and industry, which litigation may be inherently uncertain. With respect to both existing and future litigation, we will continue vigorously to defend ourselves and/or take other steps as we
believe are in the overall interests of CSR and its shareholders.

The Company and its subsidiaries are currently involved in a number of legal
proceedings as disclosed below. Other than these the Company and its subsidiaries are not involved in any legal or arbitration proceedings which may have, or have had in the 12 months preceding the date of this report, a significant effect on the
financial statements. Further, other than as disclosed below, due to inherent uncertainties, no accurate qualification of any cost, or timing of such cost, which may arise from any of the legal proceedings outlined below can be made.

As of 19 October 2012, all lawsuits involving Bandspeed have been settled in their entirety as to CSR, including with respect to customers use of CSR
products.

After the year end, on 31 December 2012, the Group signed a full and final settlement in respect of litigation with MOSAID Technologies
Incorporated. The $7.5 million cost of this settlement was included within accruals in the financial statements and was fully paid in January 2013.

In
2011 Freescale Semiconductor, Inc. filed three investigations in the International Trade Commission in which it named Zoran or its customers as respondents, Inv. No. 337-TA-709, Inv. No. 337-TA-786 and Inv. No. 337-TA-822. In each ITC
investigation, Freescale accused Zorans products of infringing US Patent No. 5,467,455. This patent expires on 3 November 2013.

Freescale failed to prevail in each of the three investigations and the ITC did not find any violation of the relevant statute, Section 337 of the Tariff Act
of 1930.

As parallel proceedings to its three ITC investigations, Freescale filed three district court cases of which one remains in the US District
Court for the Western District of Texas (Western District of Texas I) and involves US Patent No. 5,467,455.



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Financial statements

Notes to the consolidated financial statements continued



On 10 July 2012, Freescale filed an amended complaint against CSR in the US District Court for the Western District of Texas (Case No. 1:12-CV-604; Western District of Texas II), alleging
infringement of four US patents. Western District of Texas I has been consolidated with Western District of Texas II and a trial date has not been scheduled.

On 21 May 2012, CSR filed a patent infringement complaint against Freescale in the US District Court for the Northern District of California (Case No. 12-CV-02619). CSR is asserting four US patents against
Freescale in this case. A trial date has not been scheduled.

On 12 September 2012, Freescale filed a complaint against CSR in New York state court
requesting a declaratory judgment disputing the termination of a decade old license agreement. Trial has not been set.

A number of patent portfolio
non-practising entities have filed patent infringement cases against CSR and/or Zoran. These cases are in various stages and include many other defendants. Plaintiffs in these cases, the filing dates of their respective complaints  all filed
in the US District Court for the Eastern District of Texas (except HSM Portfolio/Technology Propertys lawsuit against Zoran in the US District Court for Delaware)  and the scheduled trial dates are as follows: Advanced Processor
Technologies (Filed 26 January 2011; Trial scheduled for Q3 2013); Azure Networks and Tri-County Excelsior Foundation (Filed 22 March 2011; Trial scheduled for Q4 2013); HSM Portfolio and Technology Property (Filed 1 September 2011;
Trial scheduled for Q1 2015).

No provision has been recorded for any of the cases above as cash outflow has not been deemed probable at the balance
sheet date.

32. Operating Lease Arrangements

The group as a lessee



|                                                                                              |  |                                       |        |  |                                       |  |        |                                       |  |  |        | 
|--------------------------------------------------------------------------------------------- |  | ------------------------------------- | ------ |  | ------------------------------------- |  | ------ | ------------------------------------- |  |  | ------ | 
|                                                                                              |  | 52 weeks ended
28 December 2012 $000 |        |  | 52 weeks ended
30 December 2011 $000 |  |        | 52 weeks ended
31 December 2010 $000 | 
|Minimum lease payments under operating leases recognised in the income statement
for the year |  |                                       | 32,803 |  |                                       |  | 27,219 |                                       |  |  | 23,591 | 

At the balance sheet date, the Group had outstanding commitments for future minimum lease payments under non-cancellable operating
leases, which fall due as follows:



|                                       |  |                        |        |  |                        |  |         |                        |  |  |        | 
|-------------------------------------- |  | ---------------------- | ------ |  | ---------------------- |  | ------- | ---------------------- |  |  | ------ | 
|                                       |  | 28 December 2012
$000 |        |  | 30 December 2011
$000 |  |         | 31 December 2010
$000 | 
|Within one year                        |  |                        | 29,412 |  |                        |  | 33,352  |                        |  |  | 24,483 | 
|In the second to fifth years inclusive |  |                        | 38,269 |  |                        |  | 69,639  |                        |  |  | 31,852 | 
|After five years                       |  |                        | 5,723  |  |                        |  | 6,729   |                        |  |  | 4,713  | 
|                                       |  |                        | 73,404 |  |                        |  | 109,720 |                        |  |  | 61,048 | 

Operating lease payments represent rentals payable by the Group for certain of its office properties, office equipment and software
licences. Leases are negotiated for an average term of 3.68 years (2011: 3.35 years, 2010: 3.35 years) and rentals are fixed for an average of 3.20 years (2011: 2.85 years, 2010: 3.11 years).

The group as a lessor

Certain of the groups office properties under operating lease have been
sub-let to third party tenants. Rental income has been recognised from these sub-leases in the income statement as follows:



|                                                                                   |  |                                     |       |  |                                     |  |     |                                     |  |  |     | 
|---------------------------------------------------------------------------------- |  | ----------------------------------- | ----- |  | ----------------------------------- |  | --- | ----------------------------------- |  |  | --- | 
|                                                                                   |  | 52 weeks ended28 December 2012$000 |       |  | 52 weeks ended30 December 2011$000 |  |     | 52 weeks ended31 December 2010$000 | 
|Lease income from operating leases recognised in the income statement for the
year |  |                                     | 1,099 |  |                                     |  | 796 |                                     |  |  | 208 | 

At the balance sheet date, the group had contracted with tenants for the following future minimum lease payments:



|                                       |  |                       |       |  |                       |  |       |                       |  |  |     | 
|-------------------------------------- |  | --------------------- | ----- |  | --------------------- |  | ----- | --------------------- |  |  | --- | 
|                                       |  | 28 December 2012$000 |       |  | 30 December 2011$000 |  |       | 31 December 2010$000 | 
|In the second to fifth years inclusive |  |                       | 3,560 |  |                       |  | 1,495 |                       |  |  | 471 | 
|                                       |  |                       | 5,572 |  |                       |  | 2,367 |                       |  |  | 642 | 

33. Integration and Restructuring

During 2012 the Group continued with the restructuring programmes that were announced in 2011 following the Zoran acquisition and discontinued investment in DTV and silicon tuners. Integration and restructuring
costs of approximately $25.2 million were incurred during the period ended 28 December 2012, of which the main components were severance charges, onerous leases, and consultancy and legal costs. Through this expenditure the Group continued to reduce
its ongoing cost base through reducing headcount and office locations, optimising legal entity structures, aligning employee benefits across the group, and amalgamating CSR and Zoran processes and IT systems. An additional $2.3 million of
restructuring charges was recorded as a result of the impairment of licences following the disposal of handset development operations to Samsung.



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2012 |  | 



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Financial statements



In addition, the Group charged $12.4 million to the restructuring provisions set up in
the prior year as the majority of employees affected by these programmes left the Group during the period ending 28 December 2012 (see note 27). A provision of $0.9 million remains and it is expected that this will be fully utilised by the end of
2013.

In 2011, a charge of $33.7 million was recorded in relation to integration and restructuring programmes. The main components were $21.7 million of
severance costs, $9.6 million of consultancy and legal costs and $1.9 million of fixed asset impairments. At 30 December 2011 a provision of $12.4 million in respect of these severance payments was held (see note 27).

In 2010, a decision was taken to close the NordNav Technologies AB office in Sweden, which lead to approximately 10 employees leaving the Group. A charge of $1.1
million was recorded in relation to the closure, most of which related to severance costs. At 31 December 2010, $1.1 million was accrued and paid during 2011.

34. Share  Based Payments

Equity-settled share option schemes

CSR plc has grants and awards in the following Share Schemes which result in charges to the Consolidated Income Statement:

Global Share Option Scheme

The Company has a share
option scheme for all employees of the Group, under which share options were issued prior to flotation in February 2004, at a price based on the most recent private funding round. These options had a vesting period of five years and if the options
remain unexercised after a period of ten years from the date of grant, the options lapse. Options are forfeited if the employee leaves the Group before the options vest. No grants have been made under this scheme since flotation.

Company Share Option Plan (CSOP)

The Company
introduced a new scheme at flotation called the CSR plc Share Option Plan. Options granted under this plan have a three year vesting period and lapse on the tenth anniversary of the grant date, unless otherwise indicated below. Options are generally
forfeited on cessation of employment.

The following grants have been made under the scheme:

Flotation Grant

On the Companys flotation in February 2004, the Company issued share options to
all employees, at a price based on the share price on the day of flotation.

Performance Grants

On the Companys flotation in February 2004, and in May 2005, May 2006, May 2007, June 2008 and certain other dates (relating to employees
joining) the Company issued share options at a price based on the average share price over the preceding three days. For options granted between 2004 and 2008, vesting is dependent upon meeting certain EPS based performance conditions.

With the decision to extend the grant of share awards with accompanying performance conditions to other employees, the Committee had decided that for grants from
2009 onwards, the performance condition for vesting would be changed to Total Shareholder Return (TSR).

The vesting of the options is subject to the
Group satisfying a performance condition based on the Total Shareholder Return of the Companys shares when compared to a group of companies selected at the time an award is first granted. In order for the shares to vest, the Group must have
met or exceeded certain TSR thresholds when compared with the TSR performance of the group of other companies.

For grants from 2011 onwards, the
Committee decided that a new performance condition, Absolute Total Shareholder Return (ATSR), be introduced.

The vesting of the options is also subject
to the Group satisfying a performance condition, based on the Absolute Total Shareholder Return of the Companys shares, when compared to the average share price of the Company for the three months prior to the date that an award is first
granted. In order for the shares to vest, the Group must have met or exceeded certain ATSR thresholds when compared to the Companys average share price for the three months prior to the date the award is first granted.

Starter Grants

The Company grants options to new
starters to assist in recruitment. Options are exercisable at a price equal to the average share price on the three days preceding the grant date. The vesting period of the options is over a period of five years with 40% vesting after two years and
5% vesting each quarter thereafter.

The Company has also issued starter grants to senior employees that vest after three years. 215,009 starter grants
with these characteristics were issued in the current period (2011: 101,540 starter grants; 2010: no grants).

CSR Share Award Plan

In May 2005, the Company introduced the CSR plc Share Award Plan, which allows for options to be granted for exercise at a future date at a price
equivalent to the nominal value of the Companys shares of £0.001. The following awards have been made:

Retention Awards

The Company issues certain employees with rights to purchase shares at nominal value (£0.001) as a method of staff retention. The vesting period
of these share awards is either two or three years. If the share awards remain unexercised after a period of ten years from the date of grant, the awards lapse. Awards are forfeited if the employee leaves the Group before the options vest.

Performance Awards

The Company issues
certain employees with rights to purchase shares at nominal value (£0.001) as a method of staff incentivisation. The vesting period of these share awards is three years. Grants between 2005 and 2008 were subject to i) the satisfaction of a TSR
condition (relative to a comparator group of companies); and ii) an improvement in the underlying financial performance of the Group. These awards have all lapsed.



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Financial statements

Notes to the consolidated financial statements continued



From 2009 onwards, the Company issued certain employees with rights to purchase shares at nominal value. The vesting period of these grants is three years and vesting is dependent upon meeting certain EPS based
performance conditions.

If the options remain unexercised after a period of ten years from the date of grant, the options lapse. Options are forfeited
if the employee leaves the Group before the options vest.

Starter Awards

The Company grants rights to new starters to purchase shares at nominal value (£0.001) to assist recruitment. The vesting period of these awards is two years. If the share awards remain unexercised after a
period of ten years from the date of grant, the awards lapse. Awards are forfeited if the employee leaves the Group before the options vest.

SAYE Schemes

The Company operates a SAYE scheme, whereby UK employees are allowed to subscribe to a
monthly savings amount for a period of three years; at the end of the three year period, the employee is allowed to either receive their saved amount plus interest or purchase shares in the Company at a price based on the average share price on the
three days prior to commencement of the SAYE scheme, discounted by 20%. This scheme is open to all employees subject to Inland Revenue approved limits on total investment, and invitations are issued at regular intervals. Employees have a period of
six months following the conclusion of the scheme to exercise their option to purchase shares.

Employee Stock Purchase Plan (ESPP) and
Global Share Purchase Plan (GSPP)

The Company introduced the GSPP and amended and restated the ESPP in August 2012 following the approval of
shareholders at the 2012 Annual General Meeting. These plans allow eligible employees to purchase shares in the Company at a 15% discount to the lower of the share prices on the first day of an offering period (typically a two year period) or at the
end of a savings period (there are typically two one year savings period in each offering period). The purchase of shares is funded by payroll deductions made from net pay over a savings period. There is a limit on the aggregate payroll deductions
per participant per savings period of $15,000.

Executive Incentive Plan (EIP)

The Company introduced this plan for its executive directors and senior management team following the approval of shareholders at the General Meeting in August 2011. The plan has two elements, element A and element
B, both of which have a maximum payout of 125% of the participants salary. The percentage of the payout is determined according to the Groups satisfaction of certain performance conditions and the participant achieving certain
objectives. Element A is settled in cash or shares (executive directors are required to take payment in shares until they have satisfied their minimum shareholding requirement) and is paid annually. Element B is settled in shares following the end
of the third year of the plan. A maximum forfeiture of 50% will be applied in each of the second and third plan years if the Group does not meet certain performance conditions. The share price at which shares are paid out at is the 30 day average
share price for the period finishing on the end of the plan year. This scheme vests over a period of 39 months.

SiRF Technology Holdings
Inc., plans

For purely historic purposes of settling pre-acquisition obligations of option and award exercise, the Company has assumed all the
obligations of the former SiRF Technology Holdings Inc. under pre-existing plans utilised by SiRF which comprise the 1995 Stock Plan, the 2004 Stock Incentive Plan, the TrueSpan 2004 Stock Incentive Plan and the Centrality 1999 Stock Plan. The
Company will not issue any options or awards under these plans going forward. All contractual terms of the assumed options remain the same, except for the converted number of shares and exercise price which were based on an exchange ratio determined
as part of the merger agreement.

Zoran Corporation plans

Under the terms of the merger agreement, all outstanding RSUs and share options granted by Zoran were assumed by CSR and converted into RSUs and options exercisable for, at the election of CSR, either CSR ADSs or
CSR ordinary shares. All contractual terms of the assumed options remain the same, except for the converted number of shares or ADSs and exercise prices which were based on an exchange ratio determined as part of the merger agreement. The plans
utilized by Zoran comprise the 1993 Stock Option Plan, the 2000 Nonstatutory Stock Option Plan, the 2005 Equity Incentive Plan, the 2005 Outside Directors Equity Plan, the Oak Technology 1994 Stock Option Plan, the Oak Technology 1994 Outside
Directors Stock Option Plan, the Oak Technology 2002 Stock Option Plan for Teralogic Group, the Microtune, Inc. 200 Stock Plan and 2010 Microtune, Inc. 2010 Stock Plan. No options or awards will be granted under these plans going forward.



|                                                              |  |                        |             |   |                                  |  |      |                        |  |  |                                  |   |  |                        |      |  |                                  |  |            |   |  |  |      | 
|------------------------------------------------------------- |  | ---------------------- | ----------- | - | -------------------------------- |  | ---- | ---------------------- |  |  | -------------------------------- | - |  | ---------------------- | ---- |  | -------------------------------- |  | ---------- | - |  |  | ---- | 
|                                                              |  | 28 December 2012       |             |   | 30 December 2011                 |  |      | 31 December 2010       | 
|                                                              |  | Number ofshare options |             |   | Weightedaverageexerciseprice (£) |  |      | Number ofshare options |  |  | Weightedaverageexerciseprice (£) |   |  | Number ofshare options |      |  | Weightedaverageexerciseprice (£) | 
|Outstanding at beginning of period                            |  |                        | 35,809,423  |   |                                  |  | 3.12 |                        |  |  | 13,562,737                       |   |  |                        | 4.09 |  |                                  |  | 16,256,257 |   |  |  | 4.57 | 
|Granted during the period                                     |  |                        | 10,437,960  |   |                                  |  | 1.06 |                        |  |  | 6,459,394                        |   |  |                        | 1.22 |  |                                  |  | 3,387,428  |   |  |  | 1.63 | 
|Replacement options granted to Zoran employees on acquisition |  |                        |            |   |                                  |  |     |                        |  |  | 22,106,662                       |   |  |                        | 4.54 |  |                                  |  |           |   |  |  |     | 
|Forfeited during the period                                   |  |                        | (12,130,517 | ) |                                  |  | 2.40 |                        |  |  | (4,650,904                       | ) |  |                        | 2.53 |  |                                  |  | (3,145,074 | ) |  |  | 5.35 | 
|Exercised during the period                                   |  |                        | (8,276,775  | ) |                                  |  | 1.87 |                        |  |  | (1,668,466                       | ) |  |                        | 0.61 |  |                                  |  | (2,935,874 | ) |  |  | 1.20 | 
|Outstanding at the end of the period                          |  |                        | 25,840,091  |   |                                  |  | 3.08 |                        |  |  | 35,809,423                       |   |  |                        | 3.12 |  |                                  |  | 13,562,737 |   |  |  | 4.09 | 
|Exercisable at the end of the period                          |  |                        | 9,908,854   |   |                                  |  | 6.24 |                        |  |  | 16,953,139                       |   |  |                        | 2.93 |  |                                  |  | 4,306,187  |   |  |  | 9.35 | 



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2012 |  | 



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Financial statements



The weighted average share price at the date of exercise for share options exercised
during the period was £2.89 (2011: £3.34; 2010: £4.08).

The options outstanding at 28 December 2012 had a weighted average
remaining contractual life of 5 years (2011: 6 years; 2010: 7 years).

In 2012, options were granted on 21 and 29 March, 1 May, 21 August
and 25 October. The aggregate estimated fair value of the options granted on those dates is $23,550,315. The weighted average fair value of these options is $2.62. In 2011, options were granted on 15 March, 1 May and 6 September. The
aggregate estimated fair value of the options granted on those dates is $19,355,000. The weighted average fair value of these options is $2.99. In 2010, options were granted on 15 March, 1 May, 13 May, 11 June and 3 September.
The aggregate estimated fair value of the options granted on those dates is $9,012,000. The weighted average fair value of these options is $4.72.

The
fair values of the share option and share award grants were based on the following inputs:

SAYE Schemes

The inputs to the Black-Scholes model are as follows:



|                                    |  |                                |         |  |                                |  |         |                                |  |  |         | 
|----------------------------------- |  | ------------------------------ | ------- |  | ------------------------------ |  | ------- | ------------------------------ |  |  | ------- | 
|                                    |  | 52 weeks ended28 December 2012 |         |  | 52 weeks ended30 December 2011 |  |         | 52 weeks ended31 December 2010 | 
|Weighted average share price (£)    |  |                                | 2.23    |  |                                |  | 3.74    |                                |  |  | 4.30    | 
|Weighted average exercise price (£) |  |                                | 2.01    |  |                                |  | 3.05    |                                |  |  | 3.91    | 
|Expected volatility                 |  |                                | 45%     |  |                                |  | 52%     |                                |  |  | 57%     | 
|Expected life                       |  |                                | 3 years |  |                                |  | 3 years |                                |  |  | 3 years | 
|Risk free rate                      |  |                                | 2.28%   |  |                                |  | 2.56%   |                                |  |  | 2.80%   | 
|Expected dividends                  |  |                                | 3%      |  |                                |  | 2%      |                                |  |  | 0%      | 

Expected volatility was determined by calculating the historical volatility of the Groups share price over a three year
period, equivalent to the vesting period of the options. The expected life used in the model has been adjusted based on managements best estimates, for the effects of non-transferability, exercise restrictions and behavioural considerations.

Company Share Option Plan (CSOP)

The
inputs to the Black-Scholes model are as follows:



|                                    |  |                                |               |  |                                |  |               |                                |  |  |               | 
|----------------------------------- |  | ------------------------------ | ------------- |  | ------------------------------ |  | ------------- | ------------------------------ |  |  | ------------- | 
|                                    |  | 52 weeks ended28 December 2012 |               |  | 52 weeks ended30 December 2011 |  |               | 52 weeks ended31 December 2010 | 
|Weighted average share price (£)    |  |                                | 2.46  3.36   |  |                                |  | 2.12  3.77   |                                |  |  | 2.98  4.65   | 
|Weighted average exercise price (£) |  |                                | 2.48  3.37   |  |                                |  | 2.14  3.76   |                                |  |  | 2.99  4.84   | 
|Expected volatility                 |  |                                | 44%  45%     |  |                                |  | 40%  53%     |                                |  |  | 57%           | 
|Expected life                       |  |                                | 3 years       |  |                                |  | 3 years       |                                |  |  | 34 years     | 
|Risk free rate                      |  |                                | 2.13%  2.38% |  |                                |  | 2.47%  2.70% |                                |  |  | 2.30%  2.95% | 
|Expected dividends                  |  |                                | 1.9%  2.6%   |  |                                |  | 2%  2.8%     |                                |  |  | 0%            | 

Expected volatility was determined by calculating the historical volatility of the Groups share price over a time period
equivalent to the expected term of the options. The expected life used in the model has been adjusted based on managements best estimates, for the effects of non-transferability, exercise restrictions and behavioural considerations. The
adjustments for the performance conditions are reflected in the proportion of options anticipated to vest.

For options issued in 2009 and 2010, the fair
value was based upon Monte-Carlo simulation of the performance of the 37 comparator companies included in the TSR conditions of the award. The Monte Carlo simulation incorporates a range of other assumptions based on the TSR comparator companies;
those assumptions given above relate to the Group. For options issued in 2011 and 2012, the fair value was based upon the Monte-Carlo simulation of the performance of the Companys share price against the ATSR conditions specified in the award,
using the assumptions included above.

Expected volatility for each Company was determined by calculating the historical volatility of the individual
Companys share price over the 3 years from the date of grant.

Retention Awards and Starter Awards

The fair value was based upon the share price on the date of grant.

Performance Awards

For pre-2009 awards, the fair value was based upon Monte-Carlo simulation of the
performance of the 38 comparator companies included in the TSR conditions of the award. Expected volatility for each Company was determined by calculating the historical volatility of the individual Companys share price over the 3 years from
the date of grant.

For awards issued from 2009 onwards, the fair value was based on the share price on the date of grant as the performance conditions
were market based.

ESPP scheme

The fair
value of the ESPP is based on the maximum cash value that each participant is eligible to accrue under the scheme rules.

Share Option
Charges

The Group recognised total expenses of $24,480,000 (2011: $13,583,000; 2010: $9,592,000;) related to equity- settled share-based payment
transactions.



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Financial statements

Notes to the consolidated financial statements continued



Cash-settled share-based payments

The Group issues to certain employees cash-settled share awards
that require the Group to pay the value of the share awards to the employee on the date of the exercise after a specified vesting period. The Group has recorded a liability of $1,502,000 in 2012 (2011: $371,000, 2010: $47,000). Fair value of the
awards is determined using the market value of the awards at the balance sheet date. The Group recorded a total expense of $1,185,000 in 2012 (2011: $335,000, 2010: $47,000l).

35. Retirement Benefit Obligations

a) Defined contribution schemes

The Group operates a defined contribution retirement benefit scheme for all qualifying employees. The assets of the scheme are held separately from those of the
Group, in funds under the control of trustees.

The total cost recorded in the income statement of $8,109,000 (2011: $7,304,000; 2010: $7,231,000)
represents contributions payable to this scheme by the Group at rates specified in the rules of the plan. As at 28 December 2012, contributions of $nil (30 December 2011: $nil) due in respect of the current reporting period had not been
paid over to the scheme.

b) Defined benefit plan

As a consequence of the Groups acquisition of Zoran on 31 August 2011, the Group has assumed the obligation for a defined benefit plan in Zoran Microelectronics Limited. Under Israeli law, there is a
requirement to make severance payments to all employees who leave a company involuntarily. There is no such requirement for those employees who leave the company voluntarily. Severance payments are calculated based on varying factors, namely the
length of employee service and salary and are funded entirely by individual investment funds held in the name of the employee by the Group. The Group does not hold a central fund to finance this obligation.

Where there are insufficient funds in these investment funds to meet involuntary severance obligations, there is a legal obligation for the Company to finance this
shortfall. This therefore meets the definition of a post employment benefit and more specifically a defined benefit plan, under IAS 19.

The obligation
for the company to make up the shortfall in severance payments of this nature is restricted to employees who joined the Company prior to 2007. Though there is no obligation for the Company to make severance payments for employees leaving
voluntarily, the assets accumulated in the employees fund are returned to the employee when leaving the Company. Severance payments to employees who joined subsequent to 2007, have been accounted for as a defined contribution employment plan

The valuation of the deficit in the balance sheet is based on the most recent actuarial valuation of the Plan as updated to take account of the market
value of the assets and the present value of the liabilities of the Plan at 28 December 2012. The financial assumptions used to calculate plan liabilities and plan assets under IAS 19 are:



|                                 |  |                  |          |  |                  |  |          | 
|-------------------------------- |  | ---------------- | -------- |  | ---------------- |  | -------- | 
|                                 |  | 28 December 2012 |          |  | 30 December 2011 | 
|Salary increase (p.a.)           |  |                  | 3.00%    |  |                  |  | 3.00%    | 
|Discount rate (p.a.)             |  |                  | 4.60%    |  |                  |  | 5.00%    | 
|Expected return on assets (p.a.) |  |                  | 4.60%    |  |                  |  | 5.00%    | 
|Inflation (p.a.)                 |  |                  | 2.75%    |  |                  |  | 2.51%    | 
|Voluntary withdrawals (p.a.)     |  |                  | 6.45%    |  |                  |  | 6.45%    | 
|Involuntary withdrawals (p.a.)   |  |                  | 1.05%    |  |                  |  | 1.05%    | 
|Normal retirement age  Men      |  |                  | 67 years |  |                  |  | 67 years | 
| Women                          |  |                  | 64 years |  |                  |  | 64 years | 

The discount rate and expected return on assets assumptions are based on 10 year Israeli government bond yields.

The analysis of movement in the deficit in the scheme for the year is:



|                                                    |  |       |        |  
|--------------------------------------------------- |  | ----- | ------ | -
|                                                    |  | $000 |       
|Deficit at 31 December 2010                         |  |       |       |  
|Acquisition                                         |  |       | 81     |  
|Contributions paid                                  |  |       | (491   | )
|Benefits paid                                       |  |       | (190   | )
|Current service cost                                |  |       | 282    |  
|Actuarial losses                                    |  |       | 435    |  
|Deficit at 30 December 2011                         |  |       | 117    |  
|Expected return on plan assets net of interest cost |  |       | (34    | )
|Contributions paid                                  |  |       | (1,442 | )
|Benefits paid                                       |  |       | (936   | )
|Current service cost                                |  |       | 762    |  
|Assets above the threshold                          |  |       | 656    |  
|Actuarial losses                                    |  |       | 919    |  
|Deficit at 28 December 2012                         |  |       | 42     |  



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|CSR plc Annual Report and Financial Statements
2012 |  | 



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Financial statements





|                                                 |  |       |        |  
|------------------------------------------------ |  | ----- | ------ | -
|The reconciliation of plan assets is as follows: | 
|                                                 |  | $000 |       
|Market value at 31 December 2010                 |  |       |       |  
|Acquisition                                      |  |       | 13,437 |  
|Benefit payments                                 |  |       | (839   | )
|Company contributions                            |  |       | 491    |  
|Expected return on assets                        |  |       | 274    |  
|Actuarial losses                                 |  |       | (1,016 | )
|Market value at 30 December 2011                 |  |       | 12,347 |  
|Benefit payments                                 |  |       | (6,959 | )
|Company contributions                            |  |       | 1,442  |  
|Expected return on assets                        |  |       | 493    |  
|Plan assets above surplus                        |  |       | (656   | )
|Actuarial gains                                  |  |       | 2,341  |  
|Market value at 28 December 2012                 |  |       | 9,008  |  



|                                                                      |  |       |        |  
|--------------------------------------------------------------------- |  | ----- | ------ | -
|The reconciliation of plan liabilities during the year is as follows: | 
|                                                                      |  | $000 |       
|Plan liabilities at 31 December 2010                                  |  |       |       |  
|Acquisition                                                           |  |       | 13,518 |  
|Current service cost                                                  |  |       | 282    |  
|Interest cost                                                         |  |       | 274    |  
|Benefits paid                                                         |  |       | (1,029 | )
|Actuarial gains                                                       |  |       | (581   | )
|Plan liabilities at 30 December 2011                                  |  |       | 12,464 |  
|Current service cost                                                  |  |       | 762    |  
|Interest cost                                                         |  |       | 459    |  
|Benefits paid                                                         |  |       | (7,895 | )
|Actuarial losses                                                      |  |       | 3,260  |  
|Plan liabilities at 28 December 2012                                  |  |       | 9,050  |  

The expected return on the plan assets is evaluated in accordance with the type of investment fund held in the name of employees of
the Groups Israeli subsidiary (Zoran Microelectronics Limited), as opposed to the structure of assets held within the investment funds. This approach has been adopted in the absence of a central fund. An analysis demonstrating the fair value
of the portfolio of investments in the name of employees is provided below:



|                                                |  |                  |       |  |                  |  |     |       |  |  |        |  |  |  |     | 
|----------------------------------------------- |  | ---------------- | ----- |  | ---------------- |  | --- | ----- |  |  | ------ |  |  |  | --- | 
|                                                |  | 28 December 2012 |       |  | 30 December 2011 | 
|                                                |  | $000            |       |  | %                |  |     | $000 |  |  | %      | 
|Old Pension Plan                                |  |                  | 631   |  |                  |  | 7   |       |  |  | 1,111  |  |  |  | 9   | 
|New Pension Plan                                |  |                  | 2,702 |  |                  |  | 30  |       |  |  | 3,581  |  |  |  | 29  | 
|Provident Funds Manager Insurance before 2004 |  |                  | 5,135 |  |                  |  | 57  |       |  |  | 6,915  |  |  |  | 56  | 
|Provident Funds Manager Insurance after 2004  |  |                  | 450   |  |                  |  | 5   |       |  |  | 617    |  |  |  | 5   | 
|Provident Funds Kuput Gemel                   |  |                  | 90    |  |                  |  | 1   |       |  |  | 123    |  |  |  | 1   | 
|                                                |  |                  | 9,008 |  |                  |  | 100 |       |  |  | 12,347 |  |  |  | 100 | 

The estimated amounts of contributions expected to be paid to the scheme during the current financial year is $1.8 million
(2011:$2.1 million).

The following is analysis of the charges to profit or loss and other comprehensive income:



|                                                                                           |  |                       |        |   |                       |  |      |  
|------------------------------------------------------------------------------------------ |  | --------------------- | ------ | - | --------------------- |  | ---- | -
|Income statement                                                                           |  | 28 December 2012$000 |        |   | 30 December 2011$000 | 
|Analysis of amounts chargeable to operating profit (loss):                                 |  |                       |        |   |                       |  |      |  
|Current service cost                                                                       |  |                       | (762   | ) |                       |  | (282 | )
|Analysis of amounts (charged)/credited to other finance income and costs:                  |  |                       |        |   |                       |  |      |  
|Interest on Plan liabilities                                                               |  |                       | (459   | ) |                       |  | (274 | )
|Expected return on assets in the Plan                                                      |  |                       | 493    |   |                       |  | 274  |  
|Total chargeable to the income statement before deduction of tax                           |  |                       | (728   | ) |                       |  | (282 | )
|Analysis of amounts recognised in the consolidated statement of comprehensive income:      |  |                       |        |   |                       |  |      |  
|Actuarial losses                                                                           |  |                       | (919   | ) |                       |  | (435 | )
|Pension scheme assets above the threshold                                                  |  |                       | (656   | ) |                       |  |     |  
|Total actuarial loss recognised in the consolidated statement of comprehensive
income      |  |                       | (1,575 | ) |                       |  | (435 | )
|Cumulative actuarial loss recognised in the consolidated statement of
comprehensive income |  |                       | (2,010 | ) |                       |  | (435 | )



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Financial statements

Notes to the consolidated financial statements continued



36. Financial Instruments

Financial Risk Management

The Group has exposure to the following risks from its use of financial instruments:

| |  | Credit risk
|- |  | -----------

| |  | Market risk
|- |  | -----------

| |  | Liquidity risk
|- |  | --------------

This note presents information
about the Groups exposure to each of the above risks, the Groups objectives, policies and processes for measuring and managing risk, and the Groups management of capital. Further quantitative disclosures are included throughout
these consolidated financial statements.

The Board of Directors has overall responsibility for the establishment and oversight of the Groups risk
management framework. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Groups activities. The Groups Audit Committee oversees how management monitors compliance with the
Groups risk management framework in relation to the risks faced by the Group.

Capital Risk Management

The Groups policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the
business. CSR intends to reinvest its cash balances in the business either through higher levels of investment in working capital and fixed assets or through further M&A activity to support the long-term ambitions of the Group. The capital
structure of the Group consists of cash and cash equivalents, treasury deposits and equity attributable to the equity holders of CSR plc, comprising issued share capital, reserves and retained earnings as disclosed in notes 28 and 29. The Group is
not subject to any externally imposed capital requirements.

The Group has a total of $333.3 million of treasury deposits and cash and cash equivalents
as at 28 December 2012 (30 December 2011: $277.8 million)

Significant Accounting Policies

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income
and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed in note 3 to the financial statements



|                                                                                  |  |                       |          |   |                       |  |          |  
|--------------------------------------------------------------------------------- |  | --------------------- | -------- | - | --------------------- |  | -------- | -
|                                                                                  |  | 28 December 2012$000 |          |   | 30 December 2011$000 | 
|Financial assets                                                                  |  |                       |          |   |                       |  |          |  
|Available for sale                                                                |  |                       | 3,719    |   |                       |  | 3,610    |  
|Loans and receivables (including cash and cash equivalents and treasury deposits) |  |                       | 460,659  |   |                       |  | 365,922  |  
|Derivative instruments in designated hedge accounting relationships               |  |                       | 2,496    |   |                       |  | 148      |  
|Fair value through profit and loss (FVTPL)                                        |  |                       | 4,333    |   |                       |  | 15,938   |  
|                                                                                  |  |                       | 471,207  |   |                       |  | 385,618  |  
|Financial liabilities                                                             |  |                       |          |   |                       |  |          |  
|Derivative instruments in designated hedge accounting relationships               |  |                       |         |   |                       |  | (1,550   | )
|Amortised cost                                                                    |  |                       | (209,695 | ) |                       |  | (212,183 | )
|Fair value through profit and loss (FVTPL)                                        |  |                       |         |   |                       |  | (35      | )
|                                                                                  |  |                       | (209,695 | ) |                       |  | (213,768 | )

Market Risk

Market
risk is the risk that changes in market prices, such as foreign currency exchange rates and interest rate risk will affect the Groups income or the value of its holdings of financial instruments. The objective of market risk management is to
manage and control market risk exposures within acceptable parameters, while optimising the return on risk.

Market risk exposures are measured using
sensitivity analysis.

Foreign Currency Risk Management

Substantially all of the Groups sales and costs of sales are denominated in US dollars, the functional currency of all the entities within the Group. A substantial proportion of the Groups fixed costs
are denominated in Sterling and a significant proportion of the remainder is non-USD denominated. This exposure to different currencies may result in gains or losses with respect to movements in foreign exchange rates and the impact of such
fluctuations could be material. Accordingly, the Group enters into hedging transactions pursuant to which it purchases Sterling under forward purchase contracts in order to cover the majority of its Sterling exposure.

The carrying amounts of the Groups Sterling denominated monetary assets and liabilities at the reporting date are as follows:



|             |  |                       |        |   |                       |  |        |                       |  |  |                       |  |  |  |       | 
|------------ |  | --------------------- | ------ | - | --------------------- |  | ------ | --------------------- |  |  | --------------------- |  |  |  | ----- | 
|             |  | Liabilities           |        |   | Assets                | 
|             |  | 28 December 2012£000 |        |   | 30 December 2011£000 |  |        | 28 December 2012£000 |  |  | 30 December 2011£000 | 
|GBP sterling |  |                       | (6,615 | ) |                       |  | (6,740 | )                     |  |  | 1,799                 |  |  |  | 5,675 | 



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Financial statements



The following significant exchange rates applied during the period:



|         |  |                                                                          |        |  |                       |  |        |                       |  |  |                       |  |  |  |        | 
|-------- |  | ------------------------------------------------------------------------ | ------ |  | --------------------- |  | ------ | --------------------- |  |  | --------------------- |  |  |  | ------ | 
|         |  | Weighted average forward contract rate(contracts maturing in the period) |        |  | Period end spot rate  | 
|         |  | 28 December 2012$000                                                    |        |  | 30 December 2011$000 |  |        | 28 December 2012$000 |  |  | 30 December 2011$000 | 
|GBP: USD |  |                                                                          | 1.5731 |  |                       |  | 1.5428 |                       |  |  | 1.6157                |  |  |  | 1.5535 | 

Foreign Currency Sensitivity Analysis

A 10 percent strengthening of the US dollar against GBP sterling would have decreased equity and profit or increased equity and profit by the amounts shown below as at the reporting date shown. In managements
opinion, this is a reasonably possible change given current market conditions.

This analysis assumes that all other variables, in particular interest
rates and other foreign currencies, remain constant. The analysis is performed on the same basis for 2011.



|                 |  |             |        |   |                      |  |       |  
|---------------- |  | ----------- | ------ | - | -------------------- |  | ----- | -
|28 December 2012 |  | Equity$000 |        |   | Profit or(loss)$000 | 
|GBP              |  |             | (6,881 | ) |                      |  | (316  | )
|                 |  |            
|30 December 2011 |  | Equity$000 |        |   | Profit or(loss)$000 | 
|GBP              |  |             | (7,834 | ) |                      |  | 2,693 |  

A 10 percent weakening of the US dollar against GBP sterling would have had the equal but opposite effect, on the basis that all the
other variables remain constant.

The movement in loss for the period is mainly attributable to the Groups exposure to exchange movements in
sterling denominated monetary assets and liabilities. The movement in equity is mainly as a result of the changes in fair value of forward foreign exchange contracts.

Forward Foreign Exchange Contracts

The following table indicates the periods in which the cash flows
associated with derivatives that are cash flow hedges are expected to occur:



|                                         |  |                |        |   |                    |  |         |                 |  |  |            |  |  |             |        |   |                   |  |        |   |  |  |        | 
|---------------------------------------- |  | -------------- | ------ | - | ------------------ |  | ------- | --------------- |  |  | ---------- |  |  | ----------- | ------ | - | ----------------- |  | ------ | - |  |  | ------ | 
|Cash flow hedges                         |  | Carryingamount |        |   | Expectedcash flows |  |         | 3 monthsor less |  |  | 3-6 months |  |  | 6-12 months |        |   | More thanone year | 
|28 December 2012                         |  |                |        |   |                    |  |         |                 |  |  |            |  |  |             |        |   |                   |  |        |   |  |  |        | 
|Forward foreign exchange contracts $000 |  |                |       |   |                    |  | 64,000  |                 |  |  | 15,500     |  |  |             | 15,000 |   |                   |  | 33,500 |   |  |  |       | 
|Forward foreign exchange contracts £000 |  |                |       |   |                    |  | 100,641 |                 |  |  | 24,107     |  |  |             | 23,490 |   |                   |  | 53,044 |   |  |  |       | 
|Fair value $000                         |  |                | 2,702  |   |                    |  |        |                 |  |  | 926        |  |  |             | 732    |   |                   |  | 1,044  |   |  |  |       | 
|Average exchange rate                    |  |                |       |   |                    |  | 1.5725  |                 |  |  | 1.5553     |  |  |             | 1.566  |   |                   |  | 1.5834 |   |  |  |       | 
|30 December 2011                         |  |                |        |   |                    |  |         |                 |  |  |            |  |  |             |        |   |                   |  |        |   |  |  |        | 
|Forward foreign exchange contracts $000 |  |                |       |   |                    |  | 107,631 |                 |  |  | 24,049     |  |  |             | 24,708 |   |                   |  | 48,831 |   |  |  | 10,043 | 
|Forward foreign exchange contracts £000 |  |                |       |   |                    |  | 68,500  |                 |  |  | 15,500     |  |  |             | 15,500 |   |                   |  | 31,000 |   |  |  | 6,500  | 
|Fair value $000                         |  |                | (1,437 | ) |                    |  |        |                 |  |  | 20         |  |  |             | (683   | ) |                   |  | (795   | ) |  |  | 21     | 
|Average exchange rate                    |  |                |       |   |                    |  | 1.5741  |                 |  |  | 1.5521     |  |  |             | 1.5935 |   |                   |  | 1.5753 |   |  |  | 1.5450 | 

The Directors consider the periods in which the cash flows associated with the derivatives that are cash flow hedges are expected to
occur approximate the periods when the cash flows associated with those cash flows are likely to impact profit or loss.

Interest Rate
Risk Management

The Group has no significant direct exposure to fluctuations in interest rates other than those on interest-bearing cash balances. The
majority of cash balances are held at fixed rates of interest and the effective rate of interest on those cash balances in the period was 0.27% (52 weeks ended 30 December 2011: 0.16%; 52 weeks ended 31 December 2010 : 0.22%).

Credit risk

Credit Risk Management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has
adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts with entities that are rated the
equivalent of investment grade and above for Treasury management purposes. This information is supplied by independent rating agencies where available and if not available, the Group uses other publicly available financial information and its own
trading records to rate its major customers. The Groups exposure and the credit ratings of its counterparties are continuously monitored and credit exposure is controlled by counterparty limits.

The credit risk on liquid funds and derivative financial instruments is limited because counterparties are banks with high credit ratings assigned by international
credit rating agencies.

For cash and cash equivalents and treasury deposits, the Company only transacts with entities that are equivalent to investment
grade and above.

Disclosures related to the credit risk associated with trade receivables are in note 22.



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Financial statements

Notes to the consolidated financial statements continued



Liquidity risk

Liquidity Risk Management

The Group manages liquidity risk by maintaining adequate cash reserves and by continuously monitoring forecast and actual cash flows and matching the maturity of
financial assets and liabilities. The Group has no significant borrowings from third parties and therefore liquidity risk is not considered a significant risk at this time. The table below details the Groups remaining contractual maturity for
its non-derivative financial liabilities with agreed repayment periods. The tables have been prepared based on undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay.



|                                       |  |                                        |   |  |                         |  |       |                 |  |  |                 |  |  |                 |       |  |                        |  |       |            |  |  |        |  |  |  |        | 
|-------------------------------------- |  | -------------------------------------- | - |  | ----------------------- |  | ----- | --------------- |  |  | --------------- |  |  | --------------- | ----- |  | ---------------------- |  | ----- | ---------- |  |  | ------ |  |  |  | ------ | 
|28 December 2012                       |  | Weightedaverageeffectiveinterest rate% |   |  | Less thanone month$000 |  |       | 1-2 months$000 |  |  | 2-3 months$000 |  |  | 3-6 months$000 |       |  | More than6 months$000 |  |       | Total$000 | 
|Obligations under finance leases       |  |                                        |  |  |                         |  |      |                 |  |  | 340             |  |  |                 | 167   |  |                        |  |      |            |  |  | 1,056  |  |  |  | 1,563  | 
|Litigation accrual (undiscounted)      |  |                                        |  |  |                         |  | 3,125 |                 |  |  |                |  |  |                 |      |  |                        |  | 3,125 |            |  |  | 34,375 |  |  |  | 40,625 | 
|Other payables                         |  |                                        |  |  |                         |  | 1,762 |                 |  |  |                |  |  |                 | 4,766 |  |                        |  | 775   |            |  |  | 14,463 |  |  |  | 21,766 | 
|Onerous lease provision (undiscounted) |  |                                        |  |  |                         |  | 87    |                 |  |  | 83              |  |  |                 | 105   |  |                        |  | 282   |            |  |  | 5,103  |  |  |  | 5,660  | 
|                                       |  |                                        |   |  |                         |  | 4,974 |                 |  |  | 423             |  |  |                 | 5,038 |  |                        |  | 4,182 |            |  |  | 54,997 |  |  |  | 69,614 | 
|                                       |  |                                        |   |  |                         |  |      
|30 December 2011                       |  | Weightedaverageeffectiveinterest rate% |   |  | Less thanone month$000 |  |       | 1-2 months$000 |  |  | 2-3 months$000 |  |  | 3-6 months$000 |       |  | More than6 months$000 |  |       | Total$000 | 
|Obligations under finance leases       |  |                                        |  |  |                         |  |      |                 |  |  |                |  |  |                 |      |  |                        |  |      |            |  |  | 159    |  |  |  | 159    | 
|Litigation accrual (undiscounted)      |  |                                        |  |  |                         |  | 3,125 |                 |  |  |                |  |  |                 |      |  |                        |  | 3,125 |            |  |  | 46,875 |  |  |  | 53,125 | 
|Other payables                         |  |                                        |  |  |                         |  | 2,080 |                 |  |  |                |  |  |                 | 2,319 |  |                        |  | 775   |            |  |  | 16,969 |  |  |  | 22,143 | 
|Onerous lease provision (undiscounted) |  |                                        |  |  |                         |  | 10    |                 |  |  | 10              |  |  |                 | 10    |  |                        |  | 29    |            |  |  | 3,385  |  |  |  | 3,444  | 
|                                       |  |                                        |   |  |                         |  | 5,215 |                 |  |  | 10              |  |  |                 | 2,329 |  |                        |  | 3,929 |            |  |  | 67,388 |  |  |  | 78,871 | 

Fair Value of Financial Instruments

The fair values of financial assets and liabilities are determined as follows:

Trade receivables and trade and
other payables: The carrying amount of these short-term financial instruments approximates their fair value.

Derivatives: The fair value is
estimated by discounting the difference between the contractual forward price and the current forward price for the residual maturity of the contract using an appropriate discount rate.

The carrying amounts of financial assets and liabilities in the financial statements approximates their fair values.

The following table provides an analysis of the financial assets, specifically money market funds and marketable debt instruments that are measured on a recurring
basis, subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable:

Level 1
fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 fair value
measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

Level 3 fair value measurements are those derived from valuation techniques that include significant inputs for the asset and liability that are not based on
observable market data (unobservable inputs).



|                                                                    |  |                                                   |       |  |                                   |  |       |                               |  |  |            |  |  |  |       | 
|------------------------------------------------------------------- |  | ------------------------------------------------- | ----- |  | --------------------------------- |  | ----- | ----------------------------- |  |  | ---------- |  |  |  | ----- | 
|28 December 2012                                                    |  | Quoted prices inActive Marketsfor IdenticalAssets |       |  | Significant OtherObservableInputs |  |       | SignificantUnobservableInputs |  |  |            | 
|                                                                    |  | (Level 1)
$000                                   |       |  | (Level 2)
$000                   |  |       | (Level 3)$000                |  |  | Total$000 | 
|Financial assets at FVTPL                                           |  |                                                   |       |  |                                   |  |       |                               |  |  |            |  |  |  |       | 
|United States government fixed income debt securities (1)           |  |                                                   | 4,127 |  |                                   |  |      |                               |  |  |           |  |  |  | 4,127 | 
|Derivative instruments in designated hedge accounting relationships |  |                                                   |      |  |                                   |  | 2,496 |                               |  |  |           |  |  |  | 2,496 | 
|Fair value through profit and loss (FVTPL)                          |  |                                                   |      |  |                                   |  | 206   |                               |  |  |           |  |  |  | 206   | 
|Available for sale financial assets                                 |  |                                                   |       |  |                                   |  |       |                               |  |  |            |  |  |  |       | 
|Shares in unquoted equity securities                                |  |                                                   |      |  |                                   |  |      |                               |  |  | 3,719      |  |  |  | 3,719 | 



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Financial statements



|                                                                    |  |                                                   |        |  |                                   |  |        |                               |  |  |            |  |  |  |        |  
|------------------------------------------------------------------- |  | ------------------------------------------------- | ------ |  | --------------------------------- |  | ------ | ----------------------------- |  |  | ---------- |  |  |  | ------ | -
|30 December 2011                                                    |  | Quoted prices inActive Marketsfor IdenticalAssets |        |  | Significant OtherObservableInputs |  |        | SignificantUnobservableInputs |  |  |            | 
|                                                                    |  | (Level 1)
$000                                   |        |  | (Level 2)
$000                   |  |        | (Level 3)$000                |  |  | Total$000 | 
|Financial assets at FVTPL                                           |  |                                                   |        |  |                                   |  |        |                               |  |  |            |  |  |  |        |  
|United States government fixed income debt securities (1)           |  |                                                   | 15,938 |  |                                   |  |       |                               |  |  |           |  |  |  | 15,938 |  
|Derivative instruments in designated hedge accounting relationships |  |                                                   |       |  |                                   |  | 148    |                               |  |  |           |  |  |  | 148    |  
|Available for sale financial assets                                 |  |                                                   |        |  |                                   |  |        |                               |  |  |            |  |  |  |        |  
|Shares in unquoted equity securities                                |  |                                                   |       |  |                                   |  |       |                               |  |  | 3,610      |  |  |  | 3,610  |  
|Financial liabilities at FVTPL                                      |  |                                                   |        |  |                                   |  |        |                               |  |  |            |  |  |  |        |  
|Derivative instruments in designated hedge accounting relationships |  |                                                   |       |  |                                   |  | (1,550 | )                             |  |  |           |  |  |  | (1,550 | )
|Fair value through profit and loss (FVTPL)                          |  |                                                   |       |  |                                   |  | (35    | )                             |  |  |           |  |  |  | (35    | )



|(1) | Included within Treasury deposits within the consolidated balance sheet.
|--- | ------------------------------------------------------------------------

The fair value of the unquoted equity shares can be determined as management monitors the ongoing investments by oversight involvement in the investees and due to the recent nature of the purchase, by either the
Group or other equity holders of the investees.

Reconciliation of Level 3 fair value measurements of financial assets:



|                            |  |                                          |       | 
|--------------------------- |  | ---------------------------------------- | ----- | 
|                            |  | Available for saleUnquoted equities$000 |      
|Balance at 31 December 2010 |  |                                          | 1,000 | 
|Total gains and losses:     |  |                                          |       | 
|Purchases                   |  |                                          | 2,610 | 
|Balance at 30 December 2011 |  |                                          | 3,610 | 
|Total gains and losses:     |  |                                          |       | 
|Purchases                   |  |                                          | 109   | 
|Balance at 28 December 2012 |  |                                          | 3,719 | 

37. Related Party Transactions

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

Remuneration of key management personnel

The remuneration of the directors, who are the key
management personnel of the Group, is set out below:



|                             |  |                                     |       |  |                                     |  |       |                                     |  |  |       | 
|---------------------------- |  | ----------------------------------- | ----- |  | ----------------------------------- |  | ----- | ----------------------------------- |  |  | ----- | 
|                             |  | 52 weeks ended28 December 2012$000 |       |  | 52 weeks ended30 December 2011$000 |  |       | 52 weeks ended31 December 2010$000 | 
|Short-term employee benefits |  |                                     | 5,004 |  |                                     |  | 6,558 |                                     |  |  | 4,582 | 
|Post-employment benefits     |  |                                     | 173   |  |                                     |  | 182   |                                     |  |  | 228   | 
|Share-based payment          |  |                                     | 3,721 |  |                                     |  | 765   |                                     |  |  | 1,398 | 
|                             |  |                                     | 8,898 |  |                                     |  | 7,505 |                                     |  |  | 6,208 | 

During 2011, Joep van Beurden (CEO) was appointed Chairman of the Global Semiconductor Alliance (GSA). Prior to this, Joep had held
the position of Vice Chairman of this organisation since 2009. CSR plc has paid membership fees of $25,000 to the GSA during the course of 2012 (2011: $25,000), sponsorship fees of $22,100 (2011: $17,100) and conference fees of $2,985 (2011: $nil).

Prior to the acquisition of Zoran Corporation, Levy Gerzberg held an interest in Zoran common stock and in options to acquire Zoran common stock
pursuant to option plans operated by Zoran and which were subsequently assumed by Zoran.

With effect from completion on 31 August 2011, these
interests were converted into 120,737 shares and 1,015,318 options to acquire CSR ADSs.

Dividends totalling $143,287 (2011: $237,671) were paid in the
year in respect of ordinary shares held by the Companys directors.

38. Disposal of Development Operations

On 17 July 2012, the Group entered into a conditional binding agreement with Samsung, for the transfer of development operations in handset connectivity and
location, including 311 people, together with certain rights over the Groups technology in these areas. None of the revenues associated with the Groups existing handset products were transferred as part of the transaction. This
transaction was completed on 4 October 2012.

The Consideration is subject to adjustment by up to US$10 million in certain circumstances relating to the
achievement of contractual milestones. At the balance sheet date the fair value of the probabilities of these possible circumstances and their outcomes were assessed and deemed to be less than $100,000.

The disposal was effected so that the Group could concentrate investment and resources on its five high growth markets of Voice & Music, Automotive
Infotainment, Indoors Location, Imaging and Bluetooth Smart, accelerate its higher margin platform strategy and improve the Groups overall market position.



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Financial statements

Notes to the consolidated financial statements continued



The net assets transferred on 4 October 2012 are as follows:



|                                                                                        |  |       |         |  
|--------------------------------------------------------------------------------------- |  | ----- | ------- | -
|                                                                                        |  | $000 |        
|Attributable goodwill                                                                   |  |       | 151,477 |  
|Financial assets                                                                        |  |       | 2,877   |  
|Property, plant and equipment                                                           |  |       | 3,103   |  
|Intangible assets                                                                       |  |       | 3,413   |  
|Financial liabilities                                                                   |  |       | (1,713  | )
|Net assets disposed                                                                     |  |       | 159,157 |  
|Additional liabilities recognised on
disposal1                                          |  |       | 23,665  |  
|Gain on disposal of development operations in handset connectivity and handset
location |  |       | 127,178 |  
|Total consideration                                                                     |  |       | 310,000 |  
|Purchase price:                                                                         |  |       |         |  
|Cash and cash equivalents                                                               |  |       | 272,900 |  
|Cash held in an escrow account                                                          |  |       | 31,000  |  
|Witholding tax receivable                                                               |  |       | 6,100   |  
|                                                                                        |  |       | 310,000 |  
|Net cash inflow arising on disposal:                                                    |  |       |         |  
|Consideration received in cash and cash equivalents                                     |  |       | 272,900 |  
|Disposed cash and cash equivalents                                                      |  |       | (1,577  | )
|Directly attributable costs                                                             |  |       | (13,122 | )
|                                                                                        |  |       | 258,201 |  



|1 | Additional liabilities recognised on disposal primarily consists of additional employee compensation, incurred in conjunction with the transfer of 311 employees
to Samsung, and professional fees incurred for the Samsung Transaction
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The gain on the disposal of these development operations in
handset connectivity and location has been recognised within the Groups operating profit for the period ended 28 December 2012.

As part of the
transaction, the Groups entire shareholding in Cambridge Silicon Radio Sarl was transferred to Samsung. The gain recognised on this disposal was $8.5 million and this was recognised within the Groups operating profit, as part of the
total gain on disposal of development operations in handset connectivity and location.

Prior to disposal the costs of these development operations have
been disclosed in the Legacy operating segment.

39. Acquisition of Subsidiary

Zoran Corporation

On 31 August 2011, the Group acquired 100% of the issued share capital of
Zoran Corporation (Zoran), a semiconductor supplier of video and imaging technology for cameras, televisions, silicon tuners and printing, for a consideration of $440.5 million.

The acquisition of Zoran provides CSR with imaging technology, which will complement CSRs existing wireless connectivity, audio and location technologies and gives greater access to new markets which require
location and wireless connectivity.

Each share of Zoran common stock was exchanged for 0.589 of a CSR plc ordinary share, par value
£0.001 per share and a total cash payment of $316.4m. The Group issued 29,774,144 shares in CSR plc as part of this consideration at a CSR plc share price of £2.215 and exchange rate of 1.6304 US dollars to GBP.



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Financial statements



The acquisition note is shown below:



|                                                                            |  |       |          |  
|--------------------------------------------------------------------------- |  | ----- | -------- | -
|Recognised amounts of assets acquired and liabilities assumed at fair value |  | $000 |         
|Financial assets                                                            |  |       | 271,287  |  
|Inventory                                                                   |  |       | 62,833   |  
|Property, plant and equipment                                               |  |       | 12,451   |  
|Intangible assets                                                           |  |       | 99,276   |  
|Financial liabilities                                                       |  |       | (114,005 | )
|Net assets acquired                                                         |  |       | 331,842  |  
|Allocation to goodwill                                                      |  |       | 108,703  |  
|Total consideration                                                         |  |       | 440,545  |  
|Purchase price:                                                             |  |       |          |  
|Cash                                                                        |  |       | 316,445  |  
|Fair value of shares issued                                                 |  |       | 107,524  |  
|Fair value of share options exchanged                                       |  |       | 16,576   |  
|                                                                            |  |       | 440,545  |  
|Net cash outflow arising on acquisition                                     |  |       |          |  
|Cash consideration                                                          |  |       | (316,445 | )
|Cash and cash equivalents acquired                                          |  |       | 192,583  |  
|Directly attributable costs                                                 |  |       | (18,513  | )
|                                                                            |  |       | (142,375 | )

Cash and cash equivalents acquired totalled $192.6 million. Treasury and investments of $30.6 million were also acquired, giving a
total of $223.2 million of cash, cash equivalents, treasury deposits and investments acquired.

The goodwill arising on the acquisition is attributable
to future income from new customer contracts, the acquired workforce and future technology that has yet to be designed or even conceived. It is not anticipated that any of the goodwill will be deductible for income tax purposes.

The gross value of financial assets acquired includes receivables with a fair value of $32.1 million and a gross contractual value of $32.1 million. The best
estimate at the acquisition date of the contractual cash flows not to be collected is $0 million. The amount of goodwill recognised on acquisition was revised to $108.7m (30 December 2011: $108.1m), due to a change in the fair value of assets
acquired, amounting to $0.6m identified during 2012. Prior period comparatives have not been restated because the amount is not material.

Attributable
costs amount to $18.5 million and have been charged to SG&A and to the share premium account.

Zoran Corporation contributed $111.4 million to
revenue and a profit of $20.3 million between the date of acquisition and 30 December 2011.

If the acquisition of Zoran Corporation had been
completed on the first day of the accounting period, Group revenues for the 52 week period ended 30 December 2011 would have been $1,074.5 million and the Group loss would have been $50.0 million. This does not reflect any synergistic benefits
of the acquisition for the period prior to the acquisition.

APT Licensing Limited

On 20 July 2010, CSR plc acquired 100% of the issued share capital of APT Licensing Limited (APT), a leading ultra-high quality codec developer, for a
consideration of $3.9 million. The acquisition will enhance CSRs technical capability in audio codecs and strengthen the Groups presence in mobile and wireless audio streaming.

The acquisition note is shown below:



|                                                                           |  |       |        |  
|-------------------------------------------------------------------------- |  | ----- | ------ | -
|Recognised amounts of identifiable assets acquired and liabilities assumed |  | $000 |       
|Financial assets                                                           |  |       | 813    |  
|Property, plant and equipment                                              |  |       | 117    |  
|Intangible assets                                                          |  |       | 2,500  |  
|Financial liabilities                                                      |  |       | (2,760 | )
|                                                                           |  |       | 670    |  
|Goodwill                                                                   |  |       | 3,200  |  
|Total consideration                                                        |  |       | 3,870  |  
|Satisfied by:                                                              |  |       |        |  
|Cash                                                                       |  |       | 2,330  |  
|Contingent consideration arrangement                                       |  |       | 1,540  |  
|Total consideration transferred                                            |  |       | 3,870  |  
|Net cash outflow arising on acquisition                                    |  |       |        |  
|Cash consideration                                                         |  |       | (2,330 | )
|Cash and cash equivalents acquired                                         |  |       | 428    |  
|                                                                           |  |       | (1,902 | )



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Financial statements

Notes to the consolidated financial statements continued



The fair value of the financial assets includes trade receivables with a fair value of $0.11 million and a gross contractual value of $0.14 million. The best estimate, at the acquisition date of the
contractual cash flows not to be collected is $0.03 million.

The goodwill of $3.2 million arising from the acquisition is attributable to future
customer contracts, the development of future apt-X technology and the assembled APT workforce which are not recognisable as an asset. None of the goodwill recognised is expected to be deductible for income tax purposes.

The contingent consideration arrangement was dependent on the volume of shipments of APT products in the period from the acquisition date to 31 December 2011.

The potential undiscounted amount of all future payments that the Group could be required to make under the contingent consideration arrangement is
between $nil and $3.0 million and is payable on 31 December 2011.

The fair value of the contingent consideration arrangement of $1.54 million was
estimated on the basis of a probability weighted forecast of the number of units of APT products to be sold in the earn-out period, discounted at 3.4%. This was not paid.

Acquisition-related costs included within administrative expenses in the CSR plc consolidated income statement for the 52 weeks ended 31 December 2010 amounted to $0.4 million.

As a condition of the acquisition agreement, CSR re-paid $2.0 million of outstanding loans of APT on completion of the acquisition.

APT Licensing Limited contributed $0.2 million to revenue and a loss of $0.2 million to the Groups profit for the period between the date of the acquisition
and the balance sheet date.

If the acquisition of APT Licensing Limited had been completed on the first day of the accounting period, Group revenues for
the period ended 31 December 2010 would have been $801.0 million and Group profit would have been $15.3 million.



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Signatures

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this amended annual report on its behalf.



CSR plc(Registrant)/s/ Will GardinerName:

Will GardinerTitle:

Chief Financial OfficerDate:

18 June 2013