sirius financial solutions plc
annual report  accounts 2002
innovation intelligence integration information sirius financial solutions
a specialist supplier of software and services to the 
insurance and financial services industry worldwide 
established in 1984 it has a track record of expertise 
innovation and delivery in the global market place
01 sirius highlights 2002
02 sirius at a glance
04 chairman’s statement
07 client endorsements
08 group chief executive’s statement
13 directors and advisers
14 directors’ report
16 corporate governance
18 directors’ remuneration report
22 statement of directors’ responsibilities
22 independent auditors’ report
24 group profit and loss account
25 group statement of total recognised gains and losses
25 group reconciliation of movements in shareholders’ funds
26 group balance sheet
27 company balance sheet
28 group statement of cash flows
29 notes to the accounts
49 notice of annual general meeting
51 form of proxy
ibc investors’ calendar 2003
innovation intelligence integration information sirius highlights 2002
01
 306 increase in group turnover to £227m 2001 £174m
 significant growth in operating profit before goodwill amortisation to 
£28m 2001 £07m after charging goodwill operating profit was 
£19m 2001 operating loss of £02m
 recurring revenues remained strong at £63m 2001 £61m
 operating cash inflows of £26m 2001 £05m
 gearing reduced to zero 31 december 2001 281
 dividend levels increased with an interim dividend of 10p per share 
2001 10p and a proposed final dividend of 17p per share 
2001 15p
 strong runrate sales across all three products sirius for underwriting
sirius for broking and swift
gearing is defined as debt net of cash reserves divided by net assets excluding goodwill
global providers of
insurance software solutions
operating profit before
goodwill amortisation
£’000
turnover
£’000
96 97 98 99 00 01 02 96 97 98 99 00 01 02
7147
8745
11338
16730
17135
17374
22683
375
783
1060
1574
1623
655
2798 sirius at a glance
sirius financial solutions is headquartered in the uk and has subsidiary
operations in the us the caribbean and africa employing 270 staff 
sirius has built a customer base of over 900 insurance organisations in 50
countries worldwide 
it provides both packaged software and bespoke software solutions 
development for national and international insurance companies 
intermediaries independent financial advisers and pension trustees 
the company’s flagship software is sirius a contemporary windows®
based technology architecture and family of software components
launched in 2000 that are the result of five years’ research and 
development swift is our product specifically addressing the 
financial adviser market all products are internet enabled
the contemporary nature of our software allows us to demonstrate 
considerable business benefit to the customer through cost effective and
short term deployment customers realise a short term return on their
investment which increasingly is a prerequisite of software selection by
large corporates sirius products are combined to create software 
packages for predefined operations such as those performed by a 
general insurance broker and can also be extended or combined to suit
the needs of the larger intermediary or insurance company using our
new technology we have built three marketleading products supported
by a range of subsidiary operations which enhance the capability of the
group to create leading edge solutions
02
intelligence
innovation
information
integration 03
sirius for underwriting
a complete solution to the frontoffice and backoffice requirements of multiline
multinational general insurance underwriters driving all elements of customer relationship
management and policy administration sirius for underwriting is fully webenabled and 
provides the backoffice capability to integrate with the group’s ecommerce rating and
transaction engine delivers comparative quotations policy issuance reinsurance claims
management customer management and full accounting functionality for a range of 
personal and commercial lines insurance
the sirius for underwriting technology provides for rapid systems development and 
deployment providing rich functionality at a fraction of the cost of legacy software systems
offering system scalability whilst delivering a high level of selfsufficiency
sirius for broking
a complete computing environment for the uk’s provincial and national brokers in the 
frontoffice it supports comparative quotation and electronic business transmission for private
motor household commercial vehicle and commercial package insurance in the backoffice
it manages multiledger accounting customer and policy management claim processing
bespoke reporting and marketing fully internetenabled it offers document and image 
management plus support for specialist insurance schemes and functionality to ease 
compliance with forthcoming fsa regulations  
based on the principles of intelligent workflow and task management sirius for broking 
automates the clientfacing and administrative processes resulting in measurable gains in 
time productivity and cost savings
swift for financial services
a complete workflow driven frontoffice and backoffice system for independent financial
advisers and pension trustees swift offers sophisticated factfind planning and valuation 
tools that support client and portfolio data capture client investments are managed with
swift as are all types of pension funds the system supports individual including stakeholder
and group pension management and also provides specialist software for sipp and ssas
fund providers swift offers full accounting including ifa commission and fees processing 
it automates compliance tracking for the ifa and when used by a composite brokerage 
can be integrated with sirius for broking
mediamaker
an established media and new media communications business providing bluechip clients
with a full conference and communications service this integrated approach sets it apart
from other media providers and enables mediamaker to greatly enhance communications
events by providing full inhouse services that include on line registration and surveys sms
messaging and electronic delegate management 
new media skills extend to developing online communications tools intranets elearning 
systems and interactive internet sites through its division sirius interactive it delivers
expertise specific to the provision of web based communication and ecommerce 
technologies for the insurance sector
key initiatives
stargate changes the way in which brokers and ifas can transact with insurers by 
providing direct access to insurer’s eenablement facilities for quotations placement and
product information stargate’s ground breaking process provides genuine endtoend 
connectivity for the first time delivering rapid streamlined business placement at the touch 
of a button 
mediquote the uk’s first and only internet delivered private medical insurance rates and
benefits comparisons program for individual and group schemes chairman’s statement
in 2002 sirius’ confidence was confirmed
and translated into an outstanding 306
increase in turnover driven by market
leading products and a loyal and growing 
customer base
the group continued to grow well in the second half 
of the year when it delivered performance which the 
directors consider to be strong in its own right and
especially pleasing when measured against that of 
the group’s competitors and the it sector in general
strong operating cash inflows of £26m 2001 £05m
were generated during the year consequently by 
midyear the group had reduced gearing from the 31
december 2001 level of 281 to zero it remains
ungeared
review of results
sirius financial solutions embarked upon 2002 with a
vision that was scaled up radically from that of 2001
and a determination to realise the rewards of its 
significant investment in product development 
against the backdrop of increasingly difficult trading
conditions in both the technology and financial services
markets your board was nevertheless confident that
sirius would succeed on the global stage the group
saw strong signals of business to come from all of its 
product sectors and it set its operational and financial
targets commensurately high
i am pleased to report that this confidence was justified
and was translated into a 306 increase in group
turnover and significantly improved operating profits
before goodwill amortisation of £28m 2001 £07m
after charging goodwill operating profit was £19m
2001 operating loss of £02m   
sirius entered 2002 with a strong order book and 
visibility of £145m of revenues which represented
approximately twothirds of the market consensus 
forecast as a result of deferring a sizeable contract from
2001 into 2002 higher than normal first half revenues
and profits were anticipated this contributed to the
group achieving record h1 performance with a 177
increase in turnover relative to the same period
in 2001
04
ian yeoman 
chairman chairman’s statement
at the year end a major order had been secured with 
wealth management group st james’s place which will
see the future rollout of swift to 1600 users including
its extensive network of partners
partnerships
for some time sirius has felt that in order to scale the
organisation successfully and to achieve its ambitions
for global growth partnerships would need to play an 
important role in 2002 the group executed a partner
strategy which produced the desired results in terms of
business generation ability to scale our operations and
systems implementation   
joint bids in partnership with cmg resulted in two sales
to uk customers and this relationship is now opening
doors to european opportunities a partnership focusing
on the financial services sector was established with
logica now logicacmg and in the usa the group’s
partnership with align360 increased market presence
and sales opportunity and expanded our deployment
capability the group is pleased to have retained its
microsoft gold certified partner status and during the
year it embraced microsoft’s net programme
employees
in 2002 the group continued to grow its headcount
which was in marked contrast to some of its direct 
competitors where continued retrenchment was a 
feature this recruitment has equipped sirius with a 
balanced and skilled employee base
in light of the group’s strong financial performance but
whilst mindful of the difficult trading backdrop in the it
sector the directors consider that 2001 dividend levels
should be increased slightly accordingly they propose 
payment of a final dividend for 2002 of 17p per share 
product
as anticipated the early 2002 sale to the new zealand
subsidiary of insurance australia group positioned
sirius to market its underwriting product more assertively
on a global basis this major project has progressed
well and has put sirius in a good position to develop
further business in this region deployments against the
order book were executed and in november 2002 a
strategically important sale of sirius for underwriting
was secured in the north american market
market reaction to sirius for broking confirmed that 
the product continues to have a clear lead over our 
competition the group built on earlier successes and 
established itself as the supplier of choice to some of
the uk’s largest insurance intermediaries such as
alexander forbes the beckett group and country
mutual insurance brokers contract signing with aon
was a major landmark sirius for broking has now been
sold to over 150 organisations
we believe that in 2002 our swift application 
established a lead in software provision to the uk’s
larger independent financial advisers major 
deployments were undertaken at the royal bank of
scotland and the cooperative bank significantly  
05 chairman’s statement continued
i should like to thank all employees for their efforts and
demonstrable commitment to the group’s vision for
high growth and market leadership and to commend
them for the significant performance they achieved in
2002
corporate changes
2003 will see a number of changes for the group as a
corporate entity firstly it has decided to return to the
alternative investment market aim the board feel that
aim represents a more appropriate and cost effective
market for a group of our size
after the forthcoming annual general meeting two new
appointments to the board will be made mike dodd
the chief executive of our uk systems business unit will
join the board as an executive director mike has a
wealth of experience in the insurance sector where he
has held senior positions for 20 years and has been a
key member of sirius’ senior management team over
the past five years also we will welcome back michael
anstee as a nonexecutive director a position he 
previously held until september 2001 when he left us
briefly to focus on other business and leisure interests
michael is a recognised figure in the uk general 
insurance market and held business and it board 
positions with london and edinburgh insurance
company for 10 years 
finally i am retiring as nonexecutive chairman a post
i have held for two years i leave a group with market
leading products and a loyal and growing customer
base stephen verrall the current group chief
executive will take on the role of chairman and 
group chief executive from the date of my retirement 
ian yeoman
chairman
10 april 2003
06 client endorsements
07
“we are delighted to be part of what really is a ground breaking industry
achievement with stargate sirius have been able to deliver what most
companies have only paid lipservice  the first genuine endtoend 
electronic connectivity”
peter hubbard chief executive officer axa insurance
“many challenges face today’s ever changing insurance market with fsa
compliance and accelerated market consolidation being significant factors
this also opens up opportunities strategic partners and investment in
technology are critical ingredients required for future success and we see
our partnership with sirius and the technology available as key to 
achieving success” 
neil mckenzie director country mutual insurance brokers
“following an extensive market review we found that swift was able to
meet the vast majority of our business requirements we needed to ensure
that our chosen application was scaleable recognised in the market place
and provided us with the control and efficiencies we required for our 
business both now and in the future swift was the closest fit to our
requirements providing the efficiency of single client data entry with an
intelligent workflow process” 
stuart ritchie operations director cooperative bank financial advisers
“the folgate partnership represents a refreshing new model for 
commerciallyoriented business technology will play a vital role in our 
success and we feel confident that in sirius we have selected the single   
software set best able to drive forward both our broking and 
underwriting operations”
jeff dodd it director the folgate partnership
“electronic connectivity is now a key area for both ifas and providers by
helping to drive down costs and simplifying the service of business
we are delighted to be working with and partnering sirius and look 
forward to working on further developments throughout 2003” 
adam byford ebusiness development manager prudential group chief executive’s statement
for our customers value for money the ability to
deploy rapidly and the opportunity to get an early
return on their investment
our sales success was well balanced across all of our
key products as we made further global sales of
sirius for underwriting saw sirius for broking outsell
all its direct competitors and established swift as a
market leading software package for larger financial
advisers
2002  remarkable performance in a 
challenging market
in my statement this time last year i said we were
‘looking forward to a rewarding year in 2002’ and
with that in mind we embarked upon 2002 with an
ambitious vision to achieve exceptional performance
in what was already a challenging market 
our confidence was based upon the strength and
superiority of our new products which were 
generating runrate sales and being widely used by
intermediaries and insurance companies globally 
in addition we believed we had an exceptional and
dedicated team of employees and a substantial and
loyal customer base built up over the previous 18
years
whilst 2002 turned out to be a far more difficult year
than many predicted for both the insurance and it
sectors i am delighted to report that our confidence
was well founded and that the group was able to
make significant progress towards its aim of 
becoming a leading global supplier of insurance 
software
in 2002 we grew our sales by over 30 on the 
previous year this growth was all organic and driven
by the growing success of our products in our chosen
markets while there is clear evidence of a slow
down in it procurement both generally and 
specifically in the insurance sector sirius is 
developing an enviable success rate on the deals 
we bid for i believe this is due to our ability to
demonstrate a functionally rich package providing
08
“we have never had better technology 
to take to market sirius can offer 
prospective customers the reassurance 
of modern scaleable and proven 
products with high market acceptance
importantly we can demonstrate that 
sirius continues to be a knowledgeable
market aligned mature and financially 
resilient organisation”
stephen verrall
group chief executive group and new india and significantly in the us to
professional risk underwriters a specialist medical
liability underwriter  
we have made good progress with our major
deployment of sirius for underwriting to iag 
formerly nrma in new zealand with the system
due to go live this autumn we are optimistic about
further business opportunity with iag and the other
opportunities around the world that this scalable
highend version of our underwriting product 
presents
north america 
an integral part of our solutions business is our
north american operation which provides sales and
support of our underwriting and agent products in
the us and caribbean we started 2002 with the
belief that our financial performance would improve
in this strategically important region unfortunately
the us market showed few signs of recovery during
the year which was reflected in continued low buyer
confidence the group therefore decided to contain
costs and to realign itself against a limited sales 
strategy focused on existing customers and on 
securing recurring revenues i am pleased to report
that this strategy has resulted in an improvement in
financial performance over the previous year with a
small operating profit before goodwill amortisation 
of £59911 2001 loss of £556675 
there are signs that the market may be set to
improve and we enter 2003 with a new recently
appointed us manager a former member of my uk
management team
business review
in the latter part of the year the group was 
restructured from five to four business units which
has resulted in better alignment with our target 
business segments  
solutions
the solutions business unit is responsible for the sale
and delivery of our sirius and swift products as 
larger higher value ‘enterprise’ systems often with a
high degree of systems integration this is the fastest
growing business within the group having been
launched in 1999 to capitalise on the arrival of our
then new sirius products in 2002 revenue nearly
doubled to £89m 2001 £49m  
notable swift wins included sales to royal bank 
of scotland cooperative bank and the wealth 
management group st james’s place the latter will
be our largest deployment of swift with 1600 users
located throughout the uk  
sirius for broking was sold to nfu’s expanding 
broker business country mutual insurance brokers
further business was generated by folgate’s 
continued expansion and our deployment at aon
we believe that the market sees our insurance 
knowledge and its application to the delivery of 
comprehensive and flexible software products as 
our strongest asset
we consolidated our market position with sirius for
underwriting sales were made in the caribbean
including those to rsa curacao and harmony in
africa to standard fire in south america to
insurance corporation of belize in the uk to primary 
09 group chief executive’s statement continued
stargate
an important milestone for the group during 2002
was the success of our stargate connectivity initiative
it became a reality with the delivery of the first phase
with axa followed with adoption by other leading
insurers zurich allianz cornhill norwich union and
groupama  
stargate is a compelling proposition allowing real
time connectivity between broker and insurer for the
placing of commercial lines insurance policies can
be quoted and issued in minutes as opposed to
weeks it will take significant cost out of the insurance
market is likely to change the commercial lines 
trading model and represents an excellent 
opportunity for sirius to remain ahead of its 
competitors  
in addition to the commitment of the uk’s leading
general insurers we are also working with a number
of other organisations such as st james’s place
prudential and selestia to deliver the muchneeded
electronic integration between financial advisers and
product providers in the areas of policy selection
quotation and servicing 
mediquote
in the past year we continued to work towards our
goal of increasing efficiency and reducing the cost of
product distribution through use of our private 
medical insurance portal mediquote standard life
maintained its support and norwich union and
universal provident came on board moves which
should increase usage medicash brought cash plan
support to the provider panel bwca joined for
group sme business and swiss life now offers group
protection policies  
the number of networks now using mediquote
increased to 12 the number of users grew during 
the year by 56 and the number of quotations
processed each month grew by 68
support services
our support services business unit handles our 
customer support operations including our help desk
its revenues comprise maintenance contracts service
management and service level agreements and
added value services such as virus protection
during 2002 we implemented a new service 
management structure with improved focus on 
customer needs and segmentation as well as 
revenue generation new service level agreements
that were introduced helped to facilitate 
improvements in service delivery and customer 
perception 
partnerships
a key part of our solutions business unit strategy for
2002 was the establishment of an effective 
partnership programme this we considered vital to
enable us to more quickly scale our business and
capitalise on the opportunity our products present
during the year we built on our partnership with
logica cmg and together we secured two new
important customers we have strengthened our 
relationship with us based systems integrators align
360 who are now working with us on most of our
north american deployments in new zealand we
continue to work with cgey and our partner
development director has initiated a number of 
new partnership opportunities
we continue to enjoy a strong relationship with
microsoft with whom we worked during the year to
successfully demonstrate the scalability of our 
applications 
uk systems
in the autumn of 2002 we merged two of the
group’s business units  systems responsible for the
sale of our sirius for broking and swift applications
as turnkey systems to the uk’s insurance brokers and
ifas and insurer responsible for the development
and distribution of insurer products to the broker
channel this created uk systems a single larger
business unit focused on delivery to brokers ifas 
and their insurer product providers the combined
business unit grew 15 during the year to a turnover
of £70m 2001 £61m
throughout 2002 the broking market continued to
consolidate a number of strong dynamic and
acquisitive brokers became even more influential
others came together to form informal networks
through which they aim to secure a greater market
share the market is set to undergo further 
consolidation stimulated largely by the proposed fsa
regulation this consolidation is being driven by a
number of ‘movers and shakers’ entrepreneurial
organisations such as the folgate partnership and
country mutual insurance brokers whom i am
delighted to say are using our sirius for broking 
software to underpin their growing businesses
other noteworthy sales included those to well
regarded provincial insurance brokers such as
hanover park waveney charcol and griffiths 
armour it is pleasing to report that we are rapidly
approaching our 200th sale of sirius for broking
10 the business unit performed in line with budget with
turnover for the year of £42m 2001 £39m
mediamaker
mediamaker provides new media design and build
services such as internet intranet and ecommerce
development for the group’s larger insurance 
customers as well as for a range of other companies
in a variety of sectors 2003 sees the launch of 
sirius interactive a portfolio of specialist internet
based software and services for the insurance 
sector the business also provides established 
media services such as event and conference 
planning and execution 
during the year turnover increased by 6 to £26m
2001 £25m assisted by sales to new bluechip 
clients such as shell cadburys and barclays 
mediamaker also successfully delivered its 
largest conference ever for coors brewery 
the emerging markets in new media such as 
elearning did not grow as quickly as predicted
but there were encouraging breakthroughs 
with customers such as crookes healthcare  
the business completed its move to larger 
much improved premises in october of 2002
towards the end of 2002 mediamaker 
secured a three year outsourcing contract 
with boots for the provision of media services  
these two developments should allow the 
business to accelerate its growth rate 
during 2003 and beyond
employees
during the year we saw the number of 
employees in the group grow from 230 
to 270 this was largely in the area of 
professional services to resource the many 
new projects initiated by the growth in 
solution sales
as a group we put increased emphasis 
on human resources in the past year 
particularly on knowledge sharing training 
and communication the opportunity to 
learn by experience was also increased 
including for some the opportunity to work 
in our overseas offices
last year i shared our plans to move our 
head office operation in sutton coldfield to 
larger more appropriate premises 
this proved to be more challenging than was 
first envisaged however we have now identified 
suitable accommodation which reflects our 
status as a global supplier and provides a 
modern and effective working environment 
for our employees we plan to relocate during 
the first half of 2004
11 group chief executive’s statement continued
managed service provision msp
the group has identified a significant opportunity to
grow its business in the area of managed services
this will facilitate the outsourcing to a sirius 
managed service of all or part of our larger 
customers’ sirius applications third party applications
and it infrastructure msp is a configurable offering
that frees our customers to focus on their principal
business activity whilst sirius manages their it needs
our msp service optionally provides hosting at a data
centre or at the customer’s own hosting centre  
i can report considerable interest in this new 
proposition in addition this will allow us to more
widely offer an application service provider asp
deployment model  
the first half of 2003 will see a period of investment
in our msp offering as we put in place the necessary
infrastructure and resources this may result in the
group incurring some oneoff set up costs an msp
capability will strengthen the group by allowing us to
sell additional services into our customer base tender
for new contracts and importantly build on our 
recurring revenue base by creating long term added
value contracts
acquisitions
throughout 2002 we identified and evaluated a
number of acquisition opportunities whilst we are
confident of the group’s ability to generate organic
growth there will undoubtedly be further 
consolidation in our sector we will continue to assess
acquisition opportunities and our move back to the
aim market will allow the group to complete suitable
acquisitions on a more cost effective basis
summary
the technology and insurance sectors continue to
experience challenging times although we have 
confidence in our ability to build on our recent 
successes we consider it prudent to set conservative
growth expectations for the coming year nevertheless
we aim to achieve increased sales for each of our
three products and to retain our focus on building a
profitable cash generative business
stephen j verrall
10 april 2003
strategy and outlook for 2003
2002 was undoubtedly an exceptional year for the
group to a certain extent this was anticipated with
the rollover of some business from 2001
nevertheless against the backdrop of a difficult 
market we produced our best ever results the group
we are today represents a significant uplift on our
2002 starting position i would like to take this
opportunity to thank all of sirius’ employees and of
course our customers for making this possible
2003
in 2003 we intend to build on our success
specifically we will
 maintain our primary aim to become a global 
leader in the provision of insurance software
 raise our profile with the larger players in the 
insurance underwriting market with the assistance
of our partners
 aim to retain and strengthen our position as a 
leading supplier to the uk’s insurance brokers 
backed by our biggest marketing campaign to 
date
 further develop and exploit our stargate 
technology for both commercial lines insurance 
and the financial services sector
 evaluate the opportunity to open a new office in 
either australia or new zealand to coincide with 
the implementation of our iag system thus 
providing local sales resource and support to 
prospective customers in this region  
 continue with our commitment to research and 
development activity much of which will be 
sponsored by specific customer projects
12 directors
i c yeoman
s j verrall
r j bowser
j s brown
secretary
r j bowser
auditors
deloitte  touche
four brindleyplace birmingham b1 2hz
bankers
bank of scotland plc
55 temple row birmingham b2 5ls
financial adviser
close brothers corporate finance limited
10 crown place clifton street
london ec2a 4ft
broker 
collins stewart limited
88 wood street london ec2v 7qr
solicitors
dla
victoria square house victoria square
birmingham b2 4dl
registrars
capita irg plc
bourne house 34 beckenham road 
beckenham kent br3 4tu
registered office
sirius house
reddicroft sutton coldfield
west midlands b73 6bn
registered number
03273649
directors and advisers
executive directors
stephen john verrall aged 43 
group chief executive
stephen was a founding shareholder of sirius and was its
managing director from the company’s formation in recent
years he has played a key role in the management buyout
and subsequent flotation of the business and has overseen the
strong growth in the group’s turnover and customer base
stephen’s knowledge of both the software and the insurance
industry markets has been instrumental in the success of the
company he has a high profile within the industry has held
key positions in industry bodies and is a regular speaker at
trade events
richard julian bowser aged 43
finance director
richard qualified as a chartered accountant with ernst 
young after audit experience he worked for three years in 
corporate recovery and then became a manager in their 
corporate finance division in 1987 he gained two years’ 
further experience with county natwest corporate finance
since joining the company in 1989 as finance director
richard has been responsible for all financial aspects of the
business he is closely involved with stephen verrall  in the
development of the group’s strategy
nonexecutive directors
ian christopher yeoman aged 48
nonexecutive chairman
from 1993 to 2000 ian held a number of senior directorships
within ultra electronic holdings plc he was a founder member
of the management team that initiated a management buyout
from ti group plc in october 1993 and then floated the 
company on the london stock exchange in 1996 he held the
positions of company secretary finance director and
executive director in this latter role he drove business strategy
aimed at identifying growth opportunities maximizing 
profitability and generating cash flow he was also responsible
for the acquisition process identifying targets and managing
their subsequent integration into the group prior to joining
ultra electronics ian held senior finance positions in the dowty
group plessey ici and gec he became nonexecutive
chairman of sirius financial solutions plc in april 2001
john sydney brown aged 70
nonexecutive director
john retired from nws bank plc now renamed capital bank
plc in may 1996 after 38 years’ service the last 16 of which
were as a main board director during this period he set up 
the bank’s “big ticket” leasing subsidiary of which he was
managing director he worked on many other special projects
and served on bank of scotland committees he now holds a
number of nonexecutive directorships and is well known in the
finance and leasing industry in the uk and europe he was
appointed to the board in june 1998
13 directors’ report
substantial shareholding
the directors are aware of the following shareholdings
in addition to those held by themselves as disclosed on
page 20 of 3 or more of the issued share capital on
31 march 2003
 of issued
ordinary shares ordinary
of 1p each share capital 
clerical medical investment 
management limited 1598494 94 
the throgmorton 
trust plc 811000 48
fc smaller 
companies plc 635000 37 
employee save as you earn  scheme
a further saye scheme was launched during 2002 at
the year end 113 employees collectively held options
over 615792 ordinary shares of the company under
the schemes in place
executive share options
it is the group’s policy to grant options under the
approved and unapproved executive share option
schemes as required to both senior executives and 
senior employees of the group the exercise of such
options is positively linked to the performance of the
group share options issued under the schemes are
summarised in note 26
disabled employees
the group gives full consideration to applications 
for employment from disabled persons where the
requirements of the job can be adequately fulfilled by 
a handicapped or disabled person
the directors present their report and the group
accounts for the year ended 31 december 2002
principal activities and review of the 
business
the principal activities of the group are the 
development and supply of insurance specific 
application software both as a package and a solution
the group also provides hardware training 
consultancy and support to its customers the group’s
principal market remains the insurance sector covering
– amongst others – insurance brokers traditional and
ecommerce based intermediaries underwriters 
specialist scheme administrators and ifas a review of
the year’s operations is given in the chairman’s and
chief executive’s statements
results and dividends
the group profit for the year after taxation amounted 
to £997965 2001 loss of £646454 in addition to
the interim dividend of 1p 2001 1p per ordinary
share paid on 31 october 2002 the directors 
recommend a final dividend of 17p 2001 15p per
ordinary share to shareholders on the register on 
22 april 2003 payable on 30 may 2003 after 
dividends profits of £525516 2001 losses of
£1053578 were transferred to reserves 
significant developments during the year
details of the significant developments during the year
are given in the chairman’s and chief executive’s 
statements
share capital
details of changes in share capital are given in note 26
to the accounts
14 political donations
there were no political donations during the year
auditors
during the year ernst  young llp resigned as auditors
at the request of the audit committee deloitte 
touche were appointed as auditors in the year and have
expressed their willingness to continue in office as 
auditors a resolution to reappoint deloitte  touche
will be proposed at the forthcoming annual general
meeting
deloitte  touche has informed the directors that it is
intending to transfer its business to a limited liability
partnership incorporated under the limited liability
partnerships act 2000 to be known as deloitte 
touche llp  it is the current intention of the directors to
use the company’s statutory power to give consent to
the appointment of deloitte  touche being treated as
extending to deloitte  touche llp at the appropriate
time
on behalf of the board
r j bowser
director
10 april 2003
where existing employees become disabled it is the
group’s policy wherever practicable to provide 
continuing employment under normal terms and 
conditions and to provide training and career 
development and promotion to disabled employees
wherever appropriate
employee involvement
during the year the policy of providing employees with
information about the group has been continued
through the posting of regular bulletins on the group’s
intranet regular meetings are held between line 
management and employees to allow a free flow of
information and ideas and two formal sessions are held
annually to present to all employees
creditor payment policy and practice
it is the group’s policy that payments to suppliers are
made in accordance with the terms and conditions
agreed between the group and its suppliers providing
that all trading terms and conditions have been 
complied with the company has no outstanding trade
creditors at the year end
directors’ report
15 corporate governance
access to the advice and services of the company
secretary who is responsible for ensuring that board
procedures are followed and that applicable rules and
regulations are complied with and have access to the
company’s professional advisers the board meetings
during the last financial year have been attended by all
of the directors
in order to ensure that the directors can properly carry
out their role the members of the board are provided
with high quality information and financial details prior
to all board meetings the board meets approximately
six times a year and there is a high degree of contact
between board meetings to ensure all directors are
aware of the group’s business
the nomination committee
the group does not currently operate a nomination
committee but it will establish one when the group’s
size necessitates it is currently satisfied with the balance
of the board and the way it operates it is flexible in 
accordance with the group’s needs all directors are
subject to retirement by rotation every three years  
the board as a whole currently has responsibility for
new appointments to the board
the audit committee
responsibility for the group’s internal controls rests with
the board the committee is responsible for ensuring
that the code of best practice is implemented in respect
of matters relating to the group’s audit the committee
has a majority of independent members being the 
nonexecutive directors richard bowser attends by 
invitation in his capacity as finance director and
company secretary in addition the committee 
considers the appointment and the fees of the external
auditors the committee also discusses the scope of 
the audit before its commencement and it receives
reports from the external auditors the audit committee
is chaired by ian yeoman
relations with shareholders
the board places a high level of importance on 
communicating with shareholders the chairman’s and
chief executive’s statements on pages 4 to 12 include a
review of the business and future developments there 
is a regular dialogue with institutional investors 
including presentations after the company’s 
announcement of the year end results and at the half
year
the group is committed to high standards of corporate
governance the board is accountable to the
company’s shareholders for good corporate 
governance and fully supports the principles of good
governance and the code of best practice “the
combined code” prepared by the committee on
corporate governance and published in june 1998
section 1 of the code is applicable to listed companies
and the extent of the company’s compliance with the
code is detailed below
statement by the directors on 
compliance with the combined code 
the listing rules require the board to report on 
compliance with the 45 combined code provisions
throughout the year ended 31 december 2002 the
directors having reviewed the group’s corporate 
governance policies consider that the group has
throughout the year been in compliance with the 
principles set out in section 1 of the combined code
save for the exception outlined below
 the audit committee does not include at least 
three directors all of whom are nonexecutive as 
recommended by paragraph d31 of the 
combined code compliance is not possible as 
the company currently has only two nonexecutive 
directors the board considers that having only two 
nonexecutive directors does not compromise the 
role or effectiveness of the audit committee
a statement of the directors’ responsibilities in respect of
the accounts is set out on page 22 below is a brief
description of the role of the board and its committees
followed by statements regarding relations with 
shareholders the group’s system of internal control and
a statement on the business as a going concern
the workings of the board and 
its committees
the board
the board is made up of the nonexecutive chairman
chief executive finance director and one other 
nonexecutive director their biographies appear on
page 13 and details of the membership of the 
committees of the board are given on this page and
page 18 the nonexecutive directors are independent
and the senior nonexecutive director other than the
nonexecutive chairman is john brown the board
meets regularly to discuss and decide the group’s 
business and strategic decisions all directors have 
16 corporate governance
 financial and operational vetting of sales to ensure 
that they are deliverable from both technical and 
operational perspectives within commercially 
acceptable parameters
 preparation and review of a monthly project 
inventory report which summarises the status of 
each development project drawing off information 
from the group’s time recording and project 
management system
 documented product development plans which are 
updated regularly and reviewed at bimonthly 
product strategy group meetings major research 
and development projects require board approval 
and once committed to are monitored via the 
project inventory report
 adoption of standard contractual documentation for
use in the sales process changes to such 
documents require approval at a senior level
 appointment of staff of the necessary calibre to fulfill
their allotted responsibilities
 the audit committee of the board comprising 
nonexecutive directors considers significant 
financial control matters as appropriate
there is an ongoing process to embed internal controls
within the group
the board has reviewed the need for an internal audit
function but is of the opinion that existing procedures
and resource are sufficient to provide an independent
review of controls
going concern
after making enquiries the directors have a reasonable
expectation that the group has adequate resources to
continue in operational existence for the foreseeable
future for this reason they continue to adopt the going 
concern basis in preparing the accounts
ian c yeoman
chairman
10 april 2003
the board uses the annual general meeting to 
communicate with private and institutional shareholders
and welcomes their participation shareholders are 
welcome to send in questions in advance of the annual
general meeting
details of resolutions to be proposed at the annual
general meeting on 19 may 2003 can be found in the
notice of meeting on pages 49 to 50
internal controls
the board is responsible for establishing and 
maintaining the group’s system of internal control and
reviewing its effectiveness the internal control systems
are designed to meet the particular needs of the group
and the risks to which it is exposed such a system is
designed to manage rather than eliminate the risk of
failure to achieve business objectives and can only 
provide reasonable and not absolute assurance against
material misstatement or loss
there is an ongoing process for identifying evaluating
and managing the significant risks faced by the group
this has been in place for the year under review and up
to the date of approval of the report and accounts it is
regularly reviewed by the board and it accords with the
turnbull guidance
the directors are able to confirm compliance with the
relevant guidance published by the icaew throughout
the period 1 january 2002 until the board approved
the 2002 financial statements
the key procedures that the directors have established
with a view to providing effective control are as follows
 regular board meetings to consider a schedule of 
matters reserved for directors’ consideration 
including strategic financial operational risk 
management and compliance issues an 
operational board meeting also occurs monthly 
and includes representation from all business units 
within the group plus central functions such as 
finance marketing and human resources
 an established organisational structure with clearly 
defined lines of responsibility and delegation of 
authority
 comprehensive budgets and forecasts approved by 
the board reviewed and revised on a regular basis 
with performance monitored against them and 
explanations obtained for material variances
17 directors’ remuneration report
remuneration policy
executive remuneration packages are designed to
attract motivate and retain directors of the high caliber
needed to maintain the group’s position as a market
leader and to reward them for enhancing value to
shareholders the performance measurement of the
executive directors and the determination of their 
annual remuneration packages are undertaken by the
committee the remuneration of the nonexecutive
directors is determined by the board
there are four main elements of the remuneration 
package for executive directors and senior management
 basic annual salary including directors’ fees and 
benefits
 annual bonus payments which for 2002 could not 
exceed 30 of basic salary
 share option incentives and
 pension arrangements
the company’s policy is that a substantial proportion of
the remuneration of the executive directors should be
performance related  
directors are not allowed to hold appointments outside
of the group that would conflict with the group’s 
interests
basic salary
an executive director’s salary is determined by the
committee at the commencement of each year and
when an individual changes position or responsibility 
in determining appropriate levels the committee makes
reference to published research on directors’ pay levels
amongst comparable companies basic salaries were
reviewed in january 2002 when no increase was
applied to the basic salary earned for the 2001 
financial year  executive directors’ contracts of service
which include details of remuneration will be available
for inspection at the annual general meeting
in addition to basic salary the executive directors
receive certain benefits in kind principally a car
allowance and private medical insurance
introduction
this report has been prepared in accordance with the
directors’ remuneration report regulations 2002 which
introduced new statutory requirements for the disclosure
of directors’ remuneration in respect of periods ending
on or after 31 december 2002 the report also meets
the relevant requirements of the listing rules of the
financial services authority and describes how the
board has applied the principles of good governance
relating to directors’ remuneration as required by the
regulations a resolution to approve the report will be
proposed at the annual general meeting of the
company at which the financial statements will be
approved
the regulations require the auditors to report to the
company’s members on the “auditable part” of the
directors’ remuneration report and to state whether in
their opinion that part of the report has been properly
prepared in accordance with the companies act 1985
as amended by the regulations the report has 
therefore been divided into separate sections for 
audited and unaudited information
unaudited information
remuneration committee
the company has established a remuneration
committee which is constituted in accordance with 
the recommendations of the combined code the 
members of the committee are the two independent
nonexecutive directors ian yeoman and john brown
and ian yeoman chairs the committee
none of the committee has any personal financial
interest other than as shareholders or conflicts of 
interests arising from crossdirectorships or day to day
involvement in running the business the committee
makes recommendations to the board no director
plays a part in any discussion about his own 
remuneration
the committee monitors the performance of each of
the group’s executive directors and senior executives to
ensure they are rewarded fairly for their contribution
the recommendations of this committee are presented
to a meeting of the full board  
professional advice is available to this committee from
the company’s financial adviser the committee has
met twice within the last financial year
18 directors’ remuneration report
the company’s policy is to grant options to directors 
at the discretion of the committee taking into account 
individual performance up to a maximum of four times
salary over a three year period it is the company’s 
policy to phase the granting of share options rather
than to award them in single large blocks to any 
individual
the company does not operate any long term incentive
schemes other than the share option schemes described
above no significant amendments are proposed to be
made to the terms and conditions of any entitlement of
a director to share options
pension arrangements
the executive directors are members of the group’s
money purchase pension scheme it was originally
intended that they would receive benefits equivalent to a
final salary scheme in 2002 the company made 
contributions equivalent to 25 of basic annual salary
this contribution rate is the subject of a review from
time to time
performance graph
the following graph shows the company’s 
performance measured by total shareholder return
compared with the performance of the techmark all
share index and the aim index both also measured by
total shareholder return the techmark index has been
chosen as it is representative of it companies and the
aim index was chosen because sirius was quoted on
aim from flotation in june 1998 to april 2001 and
intends to return to aim in 2003 techmark and aim
represent companies which the directors consider to be
alternative investment opportunities for the company’s
shareholders
annual bonus payments
the committee establishes the objectives that must be
met each financial year if a cash bonus is to be paid 
in setting bonus parameters the committee refers to
independent research as noted above the committee
believes that any incentive award should be tied to the
interests of the company’s shareholders and that the 
principal measure of success is performance against
city forecasts the maximum performance related
bonus that could be made in 2002 was 30 of basic
annual salary incentive payments for the year ended 31
december 2002 varied between 244 and 250  
share options
the remuneration committee controls the executive
share option schemes which are used to motivate and
create incentives for executives and senior staff 
the performance criterion that must be met is that
options will only be exercisable if the percentage growth
in adjusted earnings per share of the company over 
any period of three consecutive years commencing no 
earlier than the financial year in which the date of grant
of the option falls exceeds that of the index of retail
prices over the same period by the percentage 
indicated the performance criterion was chosen to
align executive reward with shareholder return
the exercise price of options granted under the above
schemes is equal to the market value of the company’s
shares at the time when the options are granted the
company also operates a saye share option scheme
for all uk employees and executive directors of the
group under which options may be granted at a 
discount of up to 20 of market value     
19
1000
900
800
700
600
500
400
300
200
100
0
1998 1999 2000 2001 2002
sirius financial solutions plc
ftse techmark all share
ftse aim
source datastream
shareholder return
return index directors’ remuneration report continued
directors’ contracts
it is the company’s policy that executive directors
should have contracts with an indefinite term providing
for a maximum of one year’s notice both of the 
executive directors currently have contracts which are
subject to one year’s notice by either party
the contracts of both stephen verrall and richard
bowser are dated 29 june 1998
nonexecutive directors
all nonexecutive directors have specific terms of
engagement and their remuneration is determined by
the board within the limits set by the articles of
association and based on independent surveys of fees
paid to nonexecutive directors of similar companies
nonexecutive directors cannot participate in any of the
company’s share option schemes and are not eligible
to participate in the group’s pension arrangements
audited information
aggregate directors’ remuneration
the total amounts for directors’ remuneration were 
as follows
2002 2001
£ £
emoluments 466011 382415 
company contributions 
made to money purchase 
pension schemes 76000 76000
20
directors’ emoluments
basic salary benefits total total 
and fees bonuses in kind 2002 2001 
£££ £ £
executive
s j verrall 180000 44000 18250 242250 189863 
r j bowser 124000 31000 16261 171261 127982 
nonexecutive
i c yeoman 37500 – – 37500 31250
j s brown 15000 – – 15000 15000 
j a kimberley – – – – 6667 
m t anstee – – – – 11653 
aggregate emoluments 356500 75000 34511 466011 382415
directors’ shareholdings
the directors’ interests in the shares of the company are shown below
ordinary shares
of 1p each 
at 31 december at 1 january 
2002 2002 
s j verrall 5536816 5536816
r j bowser 1445919 1445919 
i c yeoman 5000 5000 
j s brown 23000 23000 directors’ remuneration report continued
directors’ pension entitlements
the executive directors are members of the group’s
money purchase pension scheme contributions paid by
the company in respect of these two directors were as
follows
2002 2001 
£ £
s j verrall 45000 45000 
r j bowser 31000 31000 
76000 76000 
approval
this report was approved by the board of directors on
10 april 2003 and signed on its behalf by
r j bowser
director
10 april 2003
21
directors’ share options
details of options over ordinary shares of 1p each for directors who served during the year are as follows
no of options 
at 1 january 
and exercise date from
31 december price which expiry
2002 £exercisable date 
s j verrall 
 save as you earn scheme issue 231001 8636 0660 231004 230405 
 approved executive share option scheme 10000 0975 171204 171211 
 unapproved executive share option scheme 15000 0975 171204 171211 
r j bowser
 save as you earn scheme issue 231001 8636 0660 231004 230405 
 approved executive share option scheme 10000 0975 171204 171211 
 unapproved executive share option scheme 10000 0975 171204 171211 
there have been no variations to the terms and conditions or performance criteria for share options during the
financial year the performance criteria that must be met for the exercise of share options is set out in the unaudited
section of this directors’ remuneration report
the market price of the company’s ordinary shares on 31 december 2002 was £1100 and the low and high
prices during the year were £0900 on 8 february 2002 and £1515 on 24 may 2002 respectively the directors are responsible for keeping proper
accounting records which disclose with reasonable
accuracy at any time the financial position of the group
and to enable them to ensure that the accounts comply
with the companies act 1985 they are also 
responsible for safeguarding the assets of the group
and hence for taking reasonable steps for the 
prevention and detection of fraud and other 
irregularities
uk company law requires the directors to prepare
accounts for each financial year which give a true and
fair view of the state of affairs of the company and the
group and of the profit or loss of the group for that
period in preparing those accounts the directors are
required to
 select suitable accounting policies and then apply 
them consistently
 make judgements and estimates that are reasonable
and prudent
 state whether applicable accounting standards have 
been followed
fullest extent permitted by law we do not accept or
assume responsibility to anyone other than the
company and the company’s members as a body for
our audit work for this report or for the opinions we
have formed
respective responsibilities of directors and auditors
as described in the statement of directors’ 
responsibilities the company’s directors are responsible
for the preparation of the financial statements in 
accordance with applicable united kingdom law and
accounting standards they are also responsible for the
preparation of the other information contained in the
annual report including the directors’ remuneration
report our responsibility is to audit the financial 
statements and the part of the directors’ remuneration
report described as having been audited in accordance
with relevant united kingdom legal and regulatory
requirements and auditing standards
we have audited the financial statements of sirius
financial solutions plc for the year ended 31 december
2002 which comprise the profit and loss account the
balance sheets the cash flow statement the statement
of total recognised gains and losses the statement of
accounting policies and the related notes 1 to 29
together with the reconciliation of movements in 
shareholders’ funds these financial statements have
been prepared under the accounting policies set out
therein we have also audited the information in the
part of the directors’ remuneration report that is
described as having been audited
this report is made solely to the company’s members
as a body in accordance with section 235 of the
companies act 1985 our audit work has been 
undertaken so that we might state to the company’s
members those matters we are required to state to them
in an auditors’ report and for no other purpose to the 
statement of directors’ responsibilities
in respect of the accounts
independent auditors’ report to the members of
sirius financial solutions plc
22 independent auditors’ report continued
we planned and performed our audit so as to obtain all
the information and explanations which we considered
necessary in order to provide us with sufficient evidence
to give reasonable assurance that the financial 
statements and the part of the directors’ remuneration
report described as having been audited are free from
material misstatement whether caused by fraud or other
irregularity or error in forming our opinion we also
evaluated the overall adequacy of the presentation of
information in the financial statements and the part of
the directors’ remuneration report described as having
been audited
opinion
in our opinion 
 the financial statements give a true and fair view of 
the state of affairs of the company and the group 
as at 31december 2002 and of the profit of the 
group for the year then ended and
 the financial statements and part of the directors’ 
remuneration report described as having been 
audited have been properly prepared in accordance
with the companies act 1985
deloitte  touche
chartered accountants and registered auditors
birmingham
10 april 2003
we report to you our opinion as to whether the financial
statements give a true and fair view and whether the
financial statements and the part of the directors’ 
remuneration report described as having been audited
have been properly prepared in accordance with the
companies act 1985 we also report to you if in our
opinion the directors’ report is not consistent with the 
financial statements if the company has not kept 
proper accounting records if we have not received all
the information and explanations we require for our
audit or if information specified by law regarding 
directors’ remuneration and transactions with the
company and other members of the group is not 
disclosed
we review whether the corporate governance statement
reflects the company’s compliance with the seven 
provisions of the combined code specified for our
review by the listing rules of the financial services
authority and we report if it does not we are not
required to consider whether the board’s statements on
internal control cover all risks and controls or form an
opinion on the effectiveness of the group’s corporate
governance procedures or its risk and control 
procedures
we read the directors’ report and the other information
contained in the annual report for the above year as
described in the contents section including the 
unaudited part of the directors’ remuneration report and
consider the implications for our report if we become
aware of any apparent misstatements or material 
inconsistencies with the financial statements
basis of audit opinion
we conducted our audit in accordance with united
kingdom auditing standards issued by the auditing
practices board an audit includes examination on a
test basis of evidence relevant to the amounts and 
disclosures in the financial statements and the part of
the directors’ remuneration report described as having
been audited it also includes an assessment of the 
significant estimates and judgements made by the 
directors in the preparation of the financial statements
and of whether the accounting policies are appropriate
to the circumstances of the company and the group
consistently applied and adequately disclosed 
23 group profit and loss account
for the year ended 31 december 2002
24
as restated
2002 2001
notes £ £
turnover 3 22683192 17373850 
cost of sales 12723927 9875848 
gross profit 9959265 7498002 
distribution costs 2444687 2601612 
administrative expenses 
 goodwill amortisation 871478 891856 
 depreciation 457274 514469 
 other 4259348 3726861 
 total administrative expenses 5588100 5133186
operating profit before goodwill amortisation 2797956 655060 
goodwill amortisation 871478 891856 
operating profit loss 4 1926478 236796 
interest receivable 7 103637 101421 
interest payable and similar charges 8 136595 145626 
profit loss on ordinary activities before taxation 1893520 281001 
tax on profitloss on ordinary activities 9 895555 365453 
profit loss on ordinary activities after taxation 997965 646454 
equity dividends on ordinary shares 11 472449 407124 
retained profit loss for the financial year 27 525516 1053578
earnings loss per share 12
 basic 60p 40p 
 diluted 59p 40p 
 adjusted 167p 41p 
ebitda 4 3255230 1169529 group reconciliation of movements in 
shareholders’ funds
for the year ended 31 december 2002
group statement of total recognised gains and losses
for the year ended 31 december 2002
25
as restated
2002 2001
£ £
profit loss for the financial year 997965 646454 
exchange difference on retranslation of net assets of subsidiary undertaking 15251 18240 
total recognised gains and losses relating to the year 982714 664694
prior year adjustment note 2 121692
total recognised gains and losses since the 2001
annual report and accounts 1104406
as restated
2002 2001
£ £
total recognised gains and losses 982714 664694 
dividends 472449 407124 
shares issued net of expenses and amounts accrued – 212219
deferred consideration paid in the form
of cash rather than shares 118750 – 
total movements during the year 391515 859599 
shareholders’ funds at 1 january 2001 as previously reported 11624357 12128691 
prior year adjustment note 2 – 355265 
shareholders’ funds at 31 december 12015872 11624357 group balance sheet
at 31 december 2002
26
as restated
2002 2001
notes £ £
fixed assets
intangible assets 13 6466973 7338451 
tangible assets 14 1663471 1521737 
8130444 8860188 
current assets 
stocks 161605246134 
debtors 1793386197356102 
cash at bank and in hand 1043744 132683 
10398415 7534919 
creditors amounts falling due within one year 20 5362665 3511157 
net current assets 5035750 4023762 
total assets less current liabilities 13166194 12883950 
creditors amounts falling due after more than one year 21 714492 951292 
accruals and deferred income 24 435830 308301 
net assets 12015872 11624357 
capital and reserves
called up share capital 26 172103 163117 
share capital to be issued 27 – 950000 
share premium account 27 4162733 4162733 
merger reserve 27 5891572 5069308 
profit and loss account 27 1789464 1279199 
12015872 11624357 
shareholders’ funds 
equity 12013757 11622242 
nonequity 2115 2115 
12015872 11624357
r j bowser
director
10 april 2003 company balance sheet
at 31 december 2002
27
2002 2001
notes £ £
fixed assets 
investments 1593652229365222 
current assets 
debtors 1722895254630390 
cash at bank and in hand 302262 –
2591787 4630390 
creditors amounts falling due within one year 20 379227 1773095 
net current assets 2212560 2857295 
net assets 11577782 12222517 
capital and reserves 
called up share capital 26 172103 163117 
share capital to be issued 27 – 950000 
share premium account 27 4162733 4162733 
merger reserve 27 5891572 5069308 
profit and loss account 27 1351374 1877359
11577782 12222517 
shareholders’ funds 
equity 11575667 12220402 
nonequity 2115 2115 
11577782 12222517
r j bowser
director
10 april 2003 group statement of cash flows
for the year ended 31 december 2002
28
2002 2001
notes £ £
net cash inflow from operating activities 28i 2597040 549228
returns on investments and servicing of finance 
interest received 103637 101421 
interest paid 126083 116366
interest element of finance lease rental payments 7301 26195 
issue costs on longterm loans – 6375 
29747 47515 
taxation 
corporation tax paid including advance corporation tax 81149 –
capital expenditure and financial investment
payments to acquire tangible fixed assets 634536 316935 
receipts from sales of tangible fixed assets 33305 70485 
601231 246450
acquisitions
deferred consideration paid 118750 –
equity dividends paid 424971 401090 
net cash inflowoutflow before financing 1341192 145827
financing
issue of ordinary share capital 2628iv – 7840
new longterm loans – 750000 
repayment of longterm loans 205000 259167 
repayment of capital element of finance leases and 
hire purchase contracts 225131 248708 
430131 249965 
increase in cash 28ii 911061 104138 notes to the accounts
at 31 december 2002
29
1 accounting policies
accounting convention
the accounts are prepared under the historical cost convention and in accordance with applicable accounting 
standards
consistent accounting policies have been applied except that financial reporting standard 19 deferred 
taxation has been introduced in the period note 2
basis of consolidation
the group accounts consolidate the accounts of sirius financial solutions plc and all its subsidiary 
undertakings drawn up to 31 december each year no profit or loss account is presented for sirius financial 
solutions plc as permitted by section 230 of the companies act 1985
turnover
turnover represents the amounts chargeable excluding sales related taxes for goods and services supplied
turnover from software licenses is recognised when the license is issued a legally binding commitment exists 
and no significant costs remain in respect of outstanding license obligations to the customer
turnover from installation consultancy support and training chargeable on a time and materials basis is 
recognised with respect to the amount of work performed
services and maintenance turnover billed to customers which relates to subsequent accounting periods is 
deferred and is recognised equally over the period that the service is to be provided
goodwill
goodwill arising on acquisition and consolidation is capitalised in the balance sheet and amortised over the 
directors’ estimate of its useful economic life it is reviewed for impairment at the end of the first full financial 
year following the acquisition and in other periods if events or changes in circumstances indicate that the 
carrying value may not be recoverable
goodwill arising on the acquisition of sirius financial systems plc is being amortised evenly over the directors’ 
estimate of its useful economic life of 20 years
goodwill arising on the acquisitions of mediquote media maker limited and sirius financial systems inc is 
being amortised evenly over the directors’ estimates of their useful economic lives of 10 years
depreciation
depreciation is provided on all tangible fixed assets excluding freehold land at rates calculated to write off 
the cost less estimated residual value of each asset evenly over its expected useful life as follows
freehold buildings  2 per annum
leasehold improvements  67 to 20 per annum
motor vehicles  20 per annum
office and it equipment  333 per annum
fixtures and fittings  20 per annum
the carrying values of tangible fixed assets are reviewed for impairment in each year if events or changes in 
circumstances indicate the carrying value may not be recoverable notes to the accounts continued
at 31 december 2002
30
1 accounting policies continued
stocks
stocks are stated at the lower of cost and net realisable value costs include those incurred in bringing each 
product to its present location and condition net realisable value is based on estimated selling price less 
further costs expected to be incurred to completion and disposal
deferred consideration
deferred consideration is accounted for when it can be reasonably foreseen that the payments will be made
deferred taxation
deferred tax is provided in full on timing differences which result in an obligation at the balance sheet date to 
pay more tax or a right to pay less tax at a future date at rates expected to apply when they crystallise based 
on current tax rates and law 
timing differences arise from the inclusion of items of income and expenditure in taxation computations in 
periods different from those in which they are included in the financial statements deferred tax is not provided 
on timing differences arising from the revaluation of fixed assets where there is no commitment to sell the asset
or on unremitted earnings of subsidiaries and associates where there is no commitment to remit these earnings
deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be 
recovered deferred tax assets and liabilities are not discounted
software development expenditure
all inhouse software development expenditure is written off as incurred
foreign currencies
company
transactions in foreign currencies are recorded at the rate ruling at the date of transaction or at the contracted 
rate if the transaction is covered by a forward foreign currency contract monetary assets and liabilities are 
retranslated at the rate of exchange ruling at the balance sheet date or if appropriate at the forward contract 
rate all differences are taken to the profit and loss account
group
the accounts of overseas subsidiary undertakings are translated at the rate of exchange ruling at the balance 
sheet date the exchange difference arising on the retranslation of opening net assets is taken directly to 
reserves  
leasing and hire purchase commitments
assets held under finance leases which are leases where substantially all the risks and rewards of ownership 
of the asset have been passed to the group and hire purchase contracts are capitalised in the balance sheet 
and are depreciated over their useful lives
the capital element of future obligations under the leases and hire purchase contracts are included as liabilities
in the balance sheet
the interest elements of the rental obligation are charged to the profit and loss account over the period of the 
lease and represent a constant proportion of the balance of capital repayments outstanding
rentals payable under operating leases are charged in the profit and loss account on a straight line basis over 
the lease term notes to the accounts continued
at 31 december 2002
31
1 accounting policies continued
pensions
the group operates a defined contribution scheme contributions are charged to the profit and loss account 
as they become payable in accordance with the rules of the scheme
share options
it is the group’s policy to provide for any employer’s national insurance contributions due on options under its 
unapproved share option schemes over the period from the date of the grant to the first date on which the 
option can be exercised the ultimate liability is calculated at a rate of 12 on the difference between the 
year end share price and the grant price being the group’s best estimate of the ultimate liability at each 
year end
advantage is taken of the exemption from charging to the profit and loss account the difference between the 
price at which options granted under saye schemes can be exercised and the share price on the date of the 
grant uitf 17
2 prior year adjustment
the adoption of financial reporting standard 19 deferred taxation has required changes in the method of 
accounting for deferred tax assets and liabilities as a result of these changes in accounting policy the year 
2001 comparatives have been restated as follows
profit and 
deferred loss 
tax account shareholders’ 
asset reserve funds 
group group group
2001 as previously reported – 1157507 11502665
adoption of frs 19 at 1 january 2001 355265 355265 355265
during year ended 31 december 2001 233573 233573 233573 
impact of adoption of frs 19 at 31 december 2001 121692 121692 121692
2001 as restated 121692 1279199 11624357 
the impact on the current year profit and loss account is £9517 notes to the accounts continued
at 31 december 2002
32
3 turnover and segmental analysis
the group operates in one principal area of activity that of the development and supply of insurance specific 
application software both as a package and as a solution
turnover originates from two geographical markets the united kingdom and north america
europe and north america
united kingdom and caribbean rest of world total  
2002 2001 2002 2001 2002 2001 2002 2001 
£ £ £ £ £ £ £ £
group turnover 
turnover by 
destination 
sales to third parties 19269573 13541091 931691 1933984 2481928 1898775 22683192 17373850 
turnover by origin 
sales to third parties 21952784 15439866 730408 1933984 – – 22683192 17373850 
profit 
segment operating 
profit loss before 
goodwill amortisation 3002003 1564197 59911 556675 – – 3061914 1007522 
goodwill amortisation 732346 751917 139132 139939 – – 871478 891856 
interest receivable 103447 101312 190 109–– 103637 101421 
interest payable 
and similar charges 136595 145626 – –– – 136595 145626 
segment profitloss
before central group
costs and taxation 2236509 767966 79031 696505 – – 2157478 71461
central group costs 263958 352462
profit loss on ordinary 
activities before taxation 1893520 281001 
net assets 
net assets liabilities 
by segment 12899647 12697173 883775 1072816 – – 12015872 11624357  notes to the accounts continued
at 31 december 2002
33
4 operating profit
this is stated after chargingcrediting
2002 2001
£ £
auditors remuneration current auditor 
 audit services  uk 37500 – 
 audit services  overseas 3000 – 
 nonaudit services 13000 – 
auditors remuneration former auditor
 audit services  uk – 45200
 audit services  overseas – 3000
 nonaudit services – 37384
operating lease rentals 
 land and buildings 270192 236892 
 plant and machinery 255246 277959 
depreciation of 
 owned fixed assets 454099 474370 
 assets held under finance leases and hire purchase contracts 3175 40099 
profit on disposal of fixed assets 2532 4451 
amortisation of goodwill 871478 891856
£7500 2001 £7000 of this relates to the company
earnings before interest tax depreciation and amortisation ebitda has been derived as follows
2002 2001
£ £
operating profit loss 1926478 236796 
add
depreciaton 457274 514469
amortisation of goodwill 871478 891856
ebitda 3255230 1169529
5 directors’ remuneration and interests
i directors’ remuneration
details of directors’ remuneration for the year are provided in the audited part of the directors’ 
remuneration report on pages 18 to 21
ii directors’ interests
the directors who held office at 31 december 2002 had interests in shares of the company as disclosed 
in the directors’ remuneration report on page 20
iii directors’ share options
details of directors’ share options are provided in the directors’ remuneration report on page 21 notes to the accounts continued
at 31 december 2002
34
6 staff costs
2002 2001
£ £
wages and salaries 8069417 7550748 
social security costs 789857 737406 
other pension costs 374914 361675 
9234188 8649829 
the monthly average number of employees during the year was follows
2002 2001
no no 
management 17 19
other 234 215 
251 234
7 interest receivable
2002 2001
£ £
bank interest receivable 70572 19770 
finance charges receivable under contracted deferred payment scheme 33065 81651 
103637 101421
8 interest payable and similar charges
2002 2001
£ £
bank loans and overdrafts and other loans wholly repayable 
within five years 126083 116366 
finance charges payable under finance leases and hire purchase 
contracts 7301 26195 
amortisation of issue costs 3211 3065 
136595 145626  notes to the accounts continued
at 31 december 2002
35
9 tax on profit on ordinary activities
i group tax charge
the group tax charge comprises
as restated
2002 2001
£ £
current tax 
 uk corporation tax 886038 135007 
deferred tax origination and reversal of timing differences 
 current year deferred tax 17813 263537 
 adjustment to prior years’ deferred tax 27330 33091 
total deferred tax 9517 230446 
total tax on profitloss on ordinary activities 895555 365453 
adoption of financial reporting standard no 19 deferred taxation has required a change in the method of 
accounting for deferred tax as a result the comparative figure for the tax on profit on ordinary activities for 
2001 has been restated from the previously reported amount of £131880 to £365453
ii factors affecting the tax charge for the period
the differences between the total current tax shown above and the amount calculated by applying the 
standard rate of uk corporation tax to the profit before tax is as follows
as restated
2002 2001
£ £
group profitloss on ordinary activities before tax 1893520 281001 
tax on profitloss on ordinary activities at standard uk  
corporation tax rate of 30 2001 30 568056 84300 
effects of 
expenses not deductible for tax purposes
 effects of goodwill 261443 267557
 other 63871 39259
depreciation in advance of capital allowances 17643 21523 
utilisation of tax losses – 262367 
movement in short term timing differences 170 22693 
deferred tax on overseas losses not recognised 18031 180375 
benefit of small company’s rate 7114 4347 
group current tax charge 886038 135007 
iii factors affecting the tax charge for future periods
no deferred tax has been recognised in respect of us losses which amount to £1200000 they will be 
recoverable as and when sirius financial systems inc generates suitable taxable profits against which these 
losses can be offset similarly no deferred tax has been recognised in respect of losses of £691000 in sirius 
financial solutions plc notes to the accounts continued
at 31 december 2002
36
10 profit attributable to members of the parent company
the loss for the year dealt with in the accounts of the parent company was £53536 2001 profit of 
£849220 as permitted by section 230 of the companies act 1985 no separate profit and loss account is 
presented in respect of the parent company
11 dividends and other appropriations
2002 2001
£ £
equity dividends on ordinary shares 
final proposed 17p per share 2001 15p 288981 241503 
interim paid 1p per share 2001 1p 169988 165621 
additional amount paid in respect of 2001 final dividend 13480 –
472449 407124
12 earnings per ordinary share
the calculation of basic earnings loss per ordinary share is based on profits of £997965 2001 loss of 
£646454 and on 16755125 2001 16035175 ordinary shares being the weighted average number of 
ordinary shares in issue during the year
the diluted earnings per share is based on the profit for the year of £997965 and on 17038452 ordinary 
shares calculated as follows
2002 
no
basic weighted average number of shares 16755125
dilutive potential ordinary shares 
executive share options and employee saye scheme 283327
17038452
a 2001 comparative for diluted earnings per share is not given as the exercise of share options would have 
the effect of reducing the loss per ordinary share and is therefore not dilutive under the terms of frs 14
adjusted earnings per share
the adjusted earnings per share is calculated from operating profit before goodwill amortisation of 
£2797956 2001 £655060 and on 16755125 2001 16035175 ordinary shares of 1p each being 
the weighted average number in issue during the year
the directors have chosen to present this adjusted earnings per share as they believe that it provides a more 
meaningful indicator of the performance of the group
13 intangible fixed assets
goodwill 
£ 
group 
cost 
at 1 january 2002 9749526 
additions – 
at 31 december 2002 9749526
amortisation 
at 1 january 2002 2411075 
provided during the year 871478 
at 31 december 2002 3282553
net book value 
at 31 december 2002 6466973
at 1 january 2002 7338451 notes to the accounts continued
at 31 december 2002
37
14 tangible fixed assets
freehold leasehold office fixtures 
land and improv motor and it and 
buildings ements vehicles equipment fittings total
£££££ £
group
cost 
at 1 january 2002 730948 16727 204376 1656985 320720 2929756 
exchange adjustment – 519 2147 6501 2005 11172 
additions – 296649 39289 231205 67393 634536 
disposals –12259 77196 ––89455 
at 31 december 2002 730948 300598 164322 1881689 386108 3463665
depreciation 
at 1 january 2002 18000 13977 99838 1127444 148760 1408019 
exchange adjustment – 252 1493 3734 938 6417 
provided during the year 6000 9202 31145 298571 112356 457274 
disposals –12259 46423 ––58682 
at 31 december 2002 24000 10668 83067 1422281 260178 1800194
net book value
at 31 december 2002 706948 289930 81255 459408 125930 1663471 
net book value 
at 1 january 2002 712948 2750 104538 529541 171960 1521737
all fixed assets are recorded at cost
the net book value of fixed assets includes an amount of £nil 2001 £64704 in respect of assets held under 
finance lease and hire purchase contracts
freehold land and buildings includes freehold land at its historic cost of £430948 2001 £430948 which is 
not depreciated notes to the accounts continued
at 31 december 2002
38
15 investments
£
company 
cost and net book value
at 1 january and 31 december 2002 9365222
details of the investments in which the group or the company holds 20 or more of the nominal value of 
any class of share capital are as follows
country of proportion nature of
name of company registration holding held business 
subsidiary undertakings
all held by the company unless indicated 
sirius financial systems plc england ordinary shares 100 software 
house 
media maker limited england ordinary shares 100 new media it 
consultancy 
mediquote health solutions limited england ordinary shares 100 medical 
insurance 
portal 
sirius financial systems inc usa common stock 100 software 
house 
swift financial systems limited scotland ordinary shares 100 dormant 
policy master group limited england ordinary shares 100 dormant 
policy master limited england ordinary shares 100 dormant 
mastersoft limited england ordinary shares 100 dormant 
 held by sirius financial systems plc
16 stocks
group group
2002 2001
£ £
computer hardware peripherals and licenses 16052 46134 
the difference between the purchase price of stocks and their replacement cost is not material notes to the accounts continued
at 31 december 2002
39
17 debtors
as restated
group group company company
2002 2001 2002 2001
£ £ £ £
trade debtors 8459822 5583014 – – 
amounts receivable under contracted  
deferred payment scheme note 18 257064 935868 – – 
amounts owed by subsidiary undertakings – – 2274644 4612929 
deferred tax note 19 112175 121692 – –
other debtors 63917 34296 – 4190 
prepayments and accrued income 445641 681232 14881 13271 
9338619 7356102 2289525 4630390 
included in amounts receivable under the contracted deferred payment scheme is an amount of £44442 
2001 £328068 which is due after more than one year
18 amounts receivable under deferred payment scheme
2002 2001
£ £
amounts receivable 
 within one year 219611 652578 
 in two to five years 45645 351265 
265256 1003843 
less finance charges allocated to future periods 8192 67975 
257064 935868 
amounts receivable are analysed as follows 
 current receivables 212622 607800 
 noncurrent receivables 44442 328068 
257064 935868 
the group has entered into a contract with amounts receivable under a deferred payments scheme notes to the accounts continued
at 31 december 2002
40
19 deferred tax
the amounts provided in the accounts are as follows
as restated
2002 2001
£ £
group
depreciation in advance of capital allowances 112365 98631 
other short term timing differences 190 23061 
deferred tax asset 112175 121692 
the company had neither a deferred tax asset nor liability as at 31 december 2002 and 31 december 2001
unrecognised deferred tax is detailed in note 9iii 
20 creditors amounts falling due within one year
group group company company  
2002 2001 2002 2001
£ £ £ £
current installments due on bank loans 
note 22 202290 201789 – –
bank overdraft – – – 1489050 
obligations under finance leases and hire 
purchase contracts note 23 – 193383 – –
trade creditors 2955950 1661513 – –
corporation tax 989896 185007 – –
other taxes and social security costs 581446 708199 – –
other creditors 271340 241492 66236 34219 
accruals 72762 78271 24010 8323 
proposed dividend 288981 241503 288981 241503 
5362665 3511157 379227 1773095 
the bank loans are secured by a fixed and floating charge over certain of the group’s assets
21 creditors amounts falling due after more than one year
group group company company  
2002 2001 2002 2001
£ £ £ £
bank loans note 22 707400 909690 – –
obligations under finance leases and 
hire purchase contracts note 23 – 31748 – –
other creditors 7092 9854 – –
714492 951292 – –
the bank loans are secured by a fixed and floating charge over certain of the group’s assets notes to the accounts continued
at 31 december 2002
41
22 loans
i analysis of maturity of loans
group group company company 
2002 2001 2002 2001
£ £ £ £
amounts falling due 
in one year or less 205000 205000 – –
between one and two years 205000 205000 – –
between two and five years 427500 577500 – –
in more than five years 82500 137500 – – 
920000 1125000 – –
less issue costs 10310 13521 – – 
909690 1111479 – –
less included in creditors amounts falling 
due within one year 202290 201789 – –
707400 909690 – – 
the group’s loans comprise a commercial mortgage drawn down in may 1999 and a term loan drawn 
down in september 2001 the rate of interest payable on both loans is 15 above libor the commercial 
mortgage is secured by a fixed charge over the group’s freehold property the term loan is secured by a 
fixed charge over the group’s freehold property and by a corporate cross guarantee in place between certain 
of the group’s companies 
details of the commercial mortgage not wholly repayable within five years are as follows
2002 2001
£ £
secured loan repayable in twice yearly instalments of £27500 357500 412500 
less issue costs 6704 7763 
350796 404737 
less included in creditors amounts falling due within one year 53941 53941 
296855 350796  notes to the accounts continued
at 31 december 2002
42
22 loans continued
ii financial liabilities – interest rate and currency profile
weighted 
average time 
total total weighted for which 
total variable fixed average rate is 
borrowings rate rate interest rate fixed 
£ £ £  years
2002 
amounts falling due within one year 
sterling bank loans 202290 202290–––
amounts falling due after more 
than one year
sterling bank loans 707400 707400–––
totals
sterling 909690 909690–––
weighted 
average time 
total total weighted for which 
total variable fixed average rate is 
borrowings rate rate interest rate fixed 
£ £ £  years
2001 
amounts falling due within one year 
sterling 
bank loans 201789 201789––– 
finance leases 193383 12696 180687 1245 09 
395172 214485 180687 1245 09 
amounts falling due after more 
than one year 
sterling 
bank loans 909690 909690 – – –
finance leases 31748 31748 – – –
941438 941438 – – –
totals
sterling 1336610 1155923 180687 1245 09 notes to the accounts continued
at 31 december 2002
43
22 loans continued
ii financial liabilities – interest rate and currency profile continued
2002 2001
£ £
analysis of the maturity of the group’s financial liabilities 
in one year or less or on demand 202290 395172 
in more than one year but not more than two years 202792 234038 
in more than two years but not more than five years 423519 572370 
in more than five years 81089 135030
909690 1336610 
based on interest rates prevailing at the year end it is estimated that the fair value of the amounts shown 
above is not materially different from the carrying value
iii financial assets – interest rate and currency profile
weighted 
average time 
total total weighted for which 
total variable fixed average rate is 
assets rate rate interest rate fixed 
£ £ £  years
2002 
amounts falling due within one year
sterling 
cash 988823 988823–––
deferred payment debtor 
receivable within one year 212622 –212622 78 12
receivable in two to five years 44442 – 44442 78 12
1245887 988823 257064 78 12
us dollar 
cash 54921 54921–––
1300808 1043744 257064 78 12 
weighted 
average time 
total total weighted for which 
total variable fixed average rate is 
assets rate rate interest rate fixed 
£ £ £  years
2001 
amounts falling due within one year
sterling 
cash 52471 52471––– 
deferred payment debtor 
receivable within one year 607800 – 607800 78 19 
receivable in two to five years 328068 – 328068 78 19 
988339 52471 935868 78 19 
us dollar 
cash 80212 80212 –––
1068551 132683 935868 78 19 
based on interest rates prevailing at the year end it is estimated that the fair value of the deferred payment 
debtor is not materially different from the carrying value 
the group has taken advantage of the exemptions of frs 13 to exclude shortterm debtors and creditors 
other than those detailed above notes to the accounts continued
at 31 december 2002
44
22 loans continued
iv borrowing facilities
the group’s borrowing limit at 31 december 2002 calculated in accordance with the articles of association 
was £16646697 2001 £12857718
2002 2001
£ £
undrawn committed borrowing facilities
sterling 
expiring in one year or less group bank overdraft facilities 1000000 1000000 
the maturity of the group’s borrowings is given in note 22i
v  treasury management
generally management believes it is appropriate to have bank borrowings on a floating rate basis although 
this policy is kept under review 
the group ensures continuity of funding by arranging for shortterm borrowings to be fully backed by 
committed mediumterm bank facilities by limiting debt repayable in any one year and by matching debt 
maturity with asset lives
the group is currently predominantly uk based and as such does not have any material currency exposures  
the group does not currently use any foreign currency hedging arrangements but will consider them should 
the group’s circumstances change
all nonroutine transactions require board approval
vi nonequity shares
the nonequity shares are denominated in sterling do not bear interest and have no set date for redemption
23 obligations under finance leases and hire purchase contracts
group group company company 
2002 2001 2002 2001
£ £ £ £
amounts payable 
within one year – 198297 – –
between two and five years – 31748 – –
– 230045 – –
less finance charges allocated to future periods – 4914 ––
– 225131 – –
finance leases and hire purchase contracts 
are analysed as follows 
current obligations note 20 – 193383 – –
noncurrent obligations note 21 – 31748 – –
– 225131 – – notes to the accounts continued
at 31 december 2002
45
24 accruals and deferred income
group group company company 
2002 2001 2002 2001
£ £ £ £
deferred maintenance revenue 342723 304866 – –
deferred services revenue 90000 – – –
deferred product revenue 3107 3435 – –
435830 308301 – –
all amounts are due in less than one year
25 other financial commitments
annual commitments under noncancellable operating leases are as follows
land and land and 
buildings buildings other other 
2002 2001 2002 2001
£ £ £ £
operating leases which expire 
 within one year 42523 – 6754 49578 
 in two to five years 39394 60335 239394 87003 
 in over five years 256964 165516 – –
338881 225851 246148 136581
26 share capital
2002 2001
no £ no £
authorised 
equity 
ordinary shares of 1p each 21788530 21788521788530 217885 
nonequity 
deferred shares of 10p each 21147 2115 21147 2115 
220000 220000 
allotted called up and fully paid 
equity 
ordinary shares of 1p each 16998868 16998816100219 161002 
nonequity 
deferred shares of 10p each 21147 2115 21147 2115 
172103 163117
during the year the following issues of ordinary equity shares were made
on 10 april 2002 898649 ordinary shares were issued at a premium of £0915 each in part satisfaction of 
the final deferred consideration of £950000 payable to the vendors of media maker limited which was 
dependent upon the financial result of media maker limited for the year ended 31 december 2001  
the balance of the final deferred consideration of £118750 was paid in cash
the deferred shareholders have no entitlement to participate in the profits or assets of the company nor do 
they carry rights to vote at any general meeting of the company notes to the accounts continued
at 31 december 2002
46
26 share capital continued
share options
number of 
ordinary 
shares exercise price 
date of grant under option £ exercise period 
approved executive share option scheme 
281098 15000 1875281001281008
200999 22950 3050 200902200909 
270401 14285 2100 270404270411 
091101 139000 0665 091104091111 
171201 200000975 171204171211
unapproved executive share option scheme 
200999 6557 3050 200902200909 
270401 33333 2100 270404270411 
091101 75000 0665 091104091111 
171201 25000 0975 171204171211 
usa share option scheme 
271000 2000 4950 271003271010 
270401 156000 2100 270404270411
employee save as you earn share option scheme 
300500 1255 5710 300503301103 
181000 2030 4390 181003180404 
160501 16851 1720 160504161104 
231001 405276 0660 231004230405 
251002 190380 1000 251005251006 
the market price of the company’s ordinary shares on 31 december 2002 was £1100 and the low and 
high prices during the year were £0900 on 8 february 2002 and £1515 on 24 may 2002 respectively  
the share price on 28 february 2003 was £1075 notes to the accounts continued
at 31 december 2002
47
27 statement of movements in reserves
share share profit 
share capital to premium merger and loss 
capital be issued account reserve account total
££££££
group 
at 1 january 2002 as 
previously reported 163117 950000 4162733 5069308 1157507 11502665 
prior year adjustment 
note 2 – – – – 121692 121692 
at 1 january 2002 as 
restated 163117 950000 4162733 5069308 1279199 11624357 
deferred consideration paid 8986 950000 – 822264 – 118750
retained profit for the year – – – – 525516 525516 
exchange difference on 
retranslation of net 
assets of subsidiary
undertaking – – – –1525115251
at 31 december 2002 172103 – 4162733 5891572 1789464 12015872
company
at 1 january 2002  163117 950000 4162733 5069308 1877359 12222517 
deferred consideration paid 8986 950000 – 822264 – 118750
retained loss for the year – – – – 525985 525985
at 31 december 2002 172103 – 4162733 5891572 1351374 11577782 notes to the accounts continued
at 31 december 2002
48
28 notes to the statement of cash flows
i reconciliation of operating profitloss to net cash inflow from operating activities
2002 2001
£ £
operating profit loss 1926478 236796 
depreciation of tangible fixed assets 457274 514469 
amortisation of goodwill 871478 891856 
profit on sale of fixed assets 2532 4451 
decrease in deferred payment debtor 678804 464937 
increase in other debtors 2580838 1254527 
decrease increase in stocks 30082 1429 
increase in creditors 1216294 175169 
net cash inflow from operating activities 2597040 549228
ii analysis of net funds debt
at at
1 january cash 31 december
2002 flow other 2002
£££ £
cash at bank and in hand 132683 911061 – 1043744
132683 911061 – 1043744
bank loans 1111479 205000 3211 909690
finance leases 225131 225131 – –
1203927 1341192 3211 134054
iii reconciliation of net cash flow to movement in net debt
2002 2001
£ £
increase in cash in the year 911061 104138 
cash outflow inflow from movement in debt and lease financing 430131 242125 
change in net debt arising from cash flows 1341192 137987 
other noncash movements 3211 3310 
movement in net debt in the year 1337981 134677 
net debt at 1 january 1203927 1069250 
net funds debt at 31 december 134054 1203927 
iv noncash transactions
during the year the company issued shares to the vendors of acquired businesses with a fair value on issue 
of £831250 note 26
29 pension commitments
a subsidiary undertaking sirius financial systems plc operated a defined contribution pension scheme during 
the year the assets of the scheme are held separately from those of the subsidiary undertaking in an 
independently administered fund the pension cost charge represents contributions payable by the subsidiary 
undertaking to the fund and amounted during the year to £365391 2001 £343893 there were prepaid 
contributions at the balance sheet date of £nil 2001 £1200 notice of annual general meeting
49
notice is hereby given that the annual general
meeting of the company will be held at the offices of
dla victoria square house victoria square
birmingham b2 4dl on 19 may 2003 at 11am for the 
following purposes
ordinary business
1 to receive the directors’ report and accounts for the
year ended 31 december 2002 together with the 
directors’ remuneration report and the auditors’ 
report on those accounts and the auditable part of 
the directors’ remuneration report
2 to approve a final dividend payment of 17p per 
ordinary share to members whose names appear on
the register of members on 22 april 2003 
3 to reelect mr s j verrall as a director of the 
company who is retiring by rotation and offers 
himself for reelection as a director
4 to reappoint deloitte  touche as auditors to the 
company from the conclusion of the meeting to the 
conclusion of the next meeting at which the 
accounts are laid before the company following 
their appointment during 2002 and to authorise 
the directors to fix their remuneration
special business
to consider and if thought fit pass the resolutions 5 6
and 7 as to which 5 will be proposed and voted on as
an ordinary resolution and resolution and 6 and 7 will
be proposed and voted on as special resolutions
5 that the directors’ are generally and 
unconditionally authorised pursuant to the 
provisions of section 80 of the companies act 
1985 to exercise all the powers of the company to 
allot relevant securities as defined by such section 
provided that
a the maximum nominal amount of such securities
that may be allotted under this authority within 
the meaning of that section is £47896
b this authority shall unless it is prior to its expiry
duly revoked or is renewed expire at  the 
conclusion of the annual general meeting of 
the company to be held in 2004 or 15 months 
from the date of passing this resolution 
whichever shall occur first save that the 
company may before such expiry make an 
offer or agreement which will or may require 
relevant securities to be allotted after such expiry
and the directors of the company may allot 
relevant securities in pursuance of such offer or 
agreement as if the power conferred hereby had
not yet expired and
c provided also that the authority granted by this 
resolution is in substitution for any authority to 
allot relevant securities previously granted to the 
directors which to the extent that it remains in 
force and an unexercised is hereby revoked
6 that subject to and conditional upon the passing 
of resolution 5 set out above the directors of the 
company be and are hereby empowered pursuant 
to section 95 of the companies act 1985 to allot 
equity securities within the meaning of section 94 
of the act for cash pursuant to section 80 of the 
said act as if section 891 of the said act did not 
apply for any such allotments provided that this 
power shall be limited to 
a the allotment of equity securities in connection 
with a rights issue in favour of or general offer 
to ordinary shareholders where the equity 
securities respectively attributable to the interests
of all the ordinary shareholders are 
proportionate as nearly as maybe to the 
number of ordinary shares held by them but 
subject to such exclusions or other 
arrangements as the directors of the company 
may deem necessary or expedient in relation to 
fractional entitlements and any legal or practical
difficulties arising under the laws of any territory 
or the requirements of any regulatory body or 
stock exchange or otherwise
b the allotment otherwise then pursuant to 
subparagraph 6a above of equity securities up
to an aggregate nominal value of £8499 and 
shall expire at the conclusion of the annual 
general meeting to be held in 2004 or 15 
months from the date of passing this resolution 
which ever shall occur first save that the 
company may before such expiry make an offer
or agreement which would or may require 
equity securities to be allotted after such expiry 
and the directors of the company may allot 
equity securities in pursuance of such offer or 
agreement as if the power conferred hereby had
not expired and provided also that the authority 
and power hereby conferred shall be in 
substitution for any previous authority conferred 
upon the directors pursuant to the said section 
95 prior to the date of passing this resolution 
which to the extent it remains in force and 
unexercised is hereby revoked notice of annual general meeting continued
50
7 that the company be generally and 
unconditionally authorised to make market 
purchases within the meaning of section 1633 of 
the companies act 1985 of ordinary shares of the 
company provided that
a the maximum number of ordinary shares hereby 
authorised to be purchased is 1699886 
representing 10 of the company’s share 
capital at the date of this resolution
b the minimum price exclusive of any expenses 
which may be paid for an ordinary share is 1p
c the maximum price exclusive of any expenses 
which may be paid for any share is an amount 
equal to 105 of the average middle market 
quotations for an ordinary share taken from the 
london stock exchange daily official list for the
five business days immediately preceding the 
date on which such share is contracted to be 
purchased
d the authority hereby conferred shall expire on 
the earlier of the date 18 months from the date 
of this annual general meeting or the close of 
the next annual general meeting of the 
company
e the company may take a contract for the 
purchase of ordinary shares under this authority 
before the expiry of this authority which would or
might be executed wholly or partly after the 
expiry of such authority and may take purchases 
of ordinary shares in pursuance of such a 
contract as if such authority had not expired
by order of the board registered office
sirius house
reddicroft
r j bowser sutton coldfield
secretary west midlands
10 april 2003 b73 6bn
notes
1 subject to note 5 below holders of ordinary 1p 
shares are entitled to attend and vote at the 
meeting  
2 a member entitled to attend and vote at the above 
meeting is entitled to appoint one or more proxies 
to attend and vote instead of him a proxy need not 
also be a member of the company
3 forms of proxy must be deposited at the company’s
registrars capita irg plc proxies po box 25 
beckenham kent br3 4br not less than 48 hours 
before the time fixed for the meeting
4 the following documents will be available for 
inspection at the company’s registered office on 
weekdays during usual business hours saturdays 
and bank holidays excepted until the date of the 
annual general meeting and during the annual 
general meeting and for at least 15 minutes before
it begins  
a a register of directors’ share interests kept 
pursuant to section 325 of the companies act 
1985 and 
b a copy of the service contracts of stephen j 
verrall and richard j bowser
5 in accordance with the articles of association only 
members whose names appear on the register of 
members at 1100am on 15 may 2003 are entitled
to attend and vote at the meeting form of proxy
51
sirius financial solutions plc
i we 

name in full and block capitals please
of


being a members of sirius financial solutions plc hereby appoint


or failing him her the duly appointed chairman of the meeting as my our proxy to attend and on vote for me us
at the annual general meeting of the company to be held on 19 may 2003 at the offices of dla victoria square
house victoria square birmingham b2 4dl and at any adjournment thereof and in relation to the resolutions
referred to below to vote as directed
  the chairman of the meeting will act as your proxy if no other name is inserted
a proxy need not be a member of the company the full text of the resolution is set out in the notice of the agm
for against 
ordinary resolutions 
resolution 1  to receive the directors’ report and accounts 
resolution 2  to approve a final dividend payment 
resolution 3  to reelect mr s j verrall as a director 
resolution 4  to reappoint the auditors 
resolution 5  authority to allot shares 
special resolutions 
resolution 6  disapplication of preemption rights 
resolution 7  market purchase of own shares 
signed the day of2003
signature
1 please indicate with an “x” in the spaces provided how you wish your votes to be cast without specific direction the proxy will abstain or 
vote at his or her discretion a proxy may vote at his or her discretion on any other competent business which comes before the meeting
2 this form of proxy together with if appropriate the power of attorney if any under which it is signed or notarially certified copy thereof 
must be lodged with the company’s registrars capita irg plc proxies bourne house 34 beckenham road beckenham kent br3 4tu 
not less than 48 hours before the time appointed for the holding of the annual general meeting or any adjournment thereof
3 any alteration to this form should be initialled
4 in the case of joint holders the signature of one holder will be accepted but the names of all joint holders should be stated  
5 in the case of a corporation the proxy must be executed by any director or by the company secretary by a duly authorised attorney or by 
an officer or agent duly authorised to do so proof of whose capacity should be included
6 completion of the proxy will not preclude holders of ordinary shares from attending and voting in person at the annual general meeting if 
the member so wishes
7 the company pursuant to regulation 41 1 and 2 of the uncertified securities regulations 2001 specifies that only those shareholders 
registered in the register of members of the company as at 1100 am on 15 may 2003 shall be entitled to attend and or vote at the meeting
in respect of the number of shares registered in their name at that time changes to entries on the register of members after that time will be 
disregarded in determining the rights of any person to attend and or vote at the meeting capita irg plc proxies
p o box 25
beckenham
kent
br3 4br
second fold
third fold
and tuck in flap opposite
first fold
business reply service
licence no mb 122
2 investors’ calendar 2003
april 10 announcement of 2002 annual results
may 19 annual general meeting
may 30 payment of 2002 final dividend
mid september announcement of 2003 interim results
october 31 payment of 2003 interim dividend sirius financial solutions plc
sirius house
reddicroft 
sutton coldfield
west midlands
b73 6bn
tel 44 0 121 355 3567
fax 44 0 121 354 4259
email infosiriusfscom
web wwwsiriusfscom
intelligence
innovation
information
integration


Summary:
 group chief executive’s statement
for our customers value for money the ability to
deploy rapidly and the opportunity to get an early
return on their investment
our sales success was well balanced across all of our
key products as we made further global sales of
sirius for underwriting saw sirius for broking outsell
all its direct competitors and established swift as a
market leading software package for larger financial
advisers
2002  remarkable performance in a 
challenging market
in my statement this time last year i said we were
‘looking forward to a rewarding year in 2002’ and
with that in mind we embarked upon 2002 with an
ambitious vision to achieve exceptional performance
in what was already a challenging market 
our confidence was based upon the strength and
superiority of our new products which were 
generating runrate sales and being widely used by
intermediaries and insurance companies globally 
in addition we believed we had an exceptional and
dedicated team of employees and a substantial and
loyal customer base built up over the previous 18
years
whilst 2002 turned out to be a far more difficult year
than many predicted for both the insurance and it
sectors i am delighted to report that our confidence
was well founded and that the group was able to
make significant progress towards its aim of 
becoming a leading global supplier of insurance 
software
in 2002 we grew our sales by over 30 on the 
previous year this growth was all organic and driven
by the growing success of our products in our chosen
markets while there is clear evidence of a slow
down in it procurement both generally and 
specifically in the insurance sector sirius is 
developing an enviable success rate on the deals 
we bid for i believe this is due to our ability to
demonstrate a functionally rich package providing
08
“we have never had better technology 
to take to market sirius can offer 
prospective customers the reassurance 
of modern scaleable and proven 
products with high market acceptance
importantly we can demonstrate that 
sirius continues to be a knowledgeable
market aligned mature and financially 
resilient organisation”
stephen verrall
group chief executive group and new india and significantly in the us to
professional risk underwriters a specialist medical
liability underwriter  
we have made good progress with our major
deployment of sirius for underwriting to iag 
formerly nrma in new zealand with the system
due to go live this autumn we are optimistic about
further business opportunity with iag and the other
opportunities around the world that this scalable
highend version of our underwriting product 
presents
north america 
an integral part of our solutions business is our
north american operation which provides sales and
support of our underwriting and agent products in
the us and caribbean we started 2002 with the
belief that our financial performance would improve
in this strategically important region unfortunately
the us market showed few signs of recovery during
the year which was reflected in continued low buyer
confidence the group therefore decided to contain
costs and to realign itself against a limited sales 
strategy focused on existing customers and on 
securing recurring revenues i am pleased to report
that this strategy has resulted in an improvement in
financial performance over the previous year with a
small operating profit before goodwill amortisation 
of £59911 2001 loss of £556675 
there are signs that the market may be set to
improve and we enter 2003 with a new recently
appointed us manager a former member of my uk
management team
business review
in the latter part of the year the group was 
restructured from five to four business units which
has resulted in better alignment with our target 
business segments  
solutions
the solutions business unit is responsible for the sale
and delivery of our sirius and swift products as 
larger higher value ‘enterprise’ systems often with a
high degree of systems integration this is the fastest
growing business within the group having been
launched in 1999 to capitalise on the arrival of our
then new sirius products in 2002 revenue nearly
doubled to £89m 2001 £49m  
notable swift wins included sales to royal bank 
of scotland cooperative bank and the wealth 
management group st james’s place the latter will
be our largest deployment of swift with 1600 users
located throughout the uk  
sirius for broking was sold to nfu’s expanding 
broker business country mutual insurance brokers
further business was generated by folgate’s 
continued expansion and our deployment at aon
we believe that the market sees our insurance 
knowledge and its application to the delivery of 
comprehensive and flexible software products as 
our strongest asset
we consolidated our market position with sirius for
underwriting sales were made in the caribbean
including those to rsa curacao and harmony in
africa to standard fire in south america to
insurance corporation of belize in the uk to primary 
09 group chief executive’s statement continued
stargate
an important milestone for the group during 2002
was the success of our stargate connectivity initiative
it became a reality with the delivery of the first phase
with axa followed with adoption by other leading
insurers zurich allianz cornhill norwich union and
groupama  
stargate is a compelling proposition allowing real
time connectivity between broker and insurer for the
placing of commercial lines insurance policies can
be quoted and issued in minutes as opposed to
weeks it will take significant cost out of the insurance
market is likely to change the commercial lines 
trading model and represents an excellent 
opportunity for sirius to remain ahead of its 
competitors  
in addition to the commitment of the uk’s leading
general insurers we are also working with a number
of other organisations such as st james’s place
prudential and selestia to deliver the muchneeded
electronic integration between financial advisers and
product providers in the areas of policy selection
quotation and servicing 
mediquote
in the past year we continued to work towards our
goal of increasing efficiency and reducing the cost of
product distribution through use of our private 
medical insurance portal mediquote standard life
maintained its support and norwich union and
universal provident came on board moves which
should increase usage medicash brought cash plan
support to the provider panel bwca joined for
group sme business and swiss life now offers group
protection policies  
the number of networks now using mediquote
increased to 12 the number of users grew during 
the year by 56 and the number of quotations
processed each month grew by 68
support services
our support services business unit handles our 
customer support operations including our help desk
its revenues comprise maintenance contracts service
management and service level agreements and
added value services such as virus protection
during 2002 we implemented a new service 
management structure with improved focus on 
customer needs and segmentation as well as 
revenue generation new service level agreements
that were introduced helped to facilitate 
improvements in service delivery and customer 
perception 
partnerships
a key part of our solutions business unit strategy for
2002 was the establishment of an effective 
partnership programme this we considered vital to
enable us to more quickly scale our business and
capitalise on the opportunity our products present
during the year we built on our partnership with
logica cmg and together we secured two new
important customers we have strengthened our 
relationship with us based systems integrators align
360 who are now working with us on most of our
north american deployments in new zealand we
continue to work with cgey and our partner
development director has initiated a number of 
new partnership opportunities
we continue to enjoy a strong relationship with
microsoft with whom we worked during the year to
successfully demonstrate the scalability of our 
applications 
uk systems
in the autumn of 2002 we merged two of the
group’s business units  systems responsible for the
sale of our sirius for broking and swift applications
as turnkey systems to the uk’s insurance brokers and
ifas and insurer responsible for the development
and distribution of insurer products to the broker
channel this created uk systems a single larger
business unit focused on delivery to brokers ifas 
and their insurer product providers the combined
business unit grew 15 during the year to a turnover
of £70m 2001 £61m
throughout 2002 the broking market continued to
consolidate a number of strong dynamic and
acquisitive brokers became even more influential
others came together to form informal networks
through which they aim to secure a greater market
share the market is set to undergo further 
consolidation stimulated largely by the proposed fsa
regulation this consolidation is being driven by a
number of ‘movers and shakers’ entrepreneurial
organisations such as the folgate partnership and
country mutual insurance brokers whom i am
delighted to say are using our sirius for broking 
software to underpin their growing businesses
other noteworthy sales included those to well
regarded provincial insurance brokers such as
hanover park waveney charcol and griffiths 
armour it is pleasing to report that we are rapidly
approaching our 200th sale of sirius for broking
10 the business unit performed in line with budget with
turnover for the year of £42m 2001 £39m
mediamaker
mediamaker provides new media design and build
services such as internet intranet and ecommerce
development for the group’s larger insurance 
customers as well as for a range of other companies
in a variety of sectors 2003 sees the launch of 
sirius interactive a portfolio of specialist internet
based software and services for the insurance 
sector the business also provides established 
media services such as event and conference 
planning and execution 
during the year turnover increased by 6 to £26m
2001 £25m assisted by sales to new bluechip 
clients such as shell cadburys and barclays 
mediamaker also successfully delivered its 
largest conference ever for coors brewery 
the emerging markets in new media such as 
elearning did not grow as quickly as predicted
but there were encouraging breakthroughs 
with customers such as crookes healthcare  
the business completed its move to larger 
much improved premises in october of 2002
towards the end of 2002 mediamaker 
secured a three year outsourcing contract 
with boots for the provision of media services  
these two developments should allow the 
business to accelerate its growth rate 
during 2003 and beyond
employees
during the year we saw the number of 
employees in the group grow from 230 
to 270 this was largely in the area of 
professional services to resource the many 
new projects initiated by the growth in 
solution sales
as a group we put increased emphasis 
on human resources in the past year 
particularly on knowledge sharing training 
and communication the opportunity to 
learn by experience was also increased 
including for some the opportunity to work 
in our overseas offices
last year i shared our plans to move our 
head office operation in sutton coldfield to 
larger more appropriate premises 
this proved to be more challenging than was 
first envisaged however we have now identified 
suitable accommodation which reflects our 
status as a global supplier and provides a 
modern and effective working environment 
for our employees we plan to relocate during 
the first half of 2004
11 group chief executive’s statement continued
managed service provision msp
the group has identified a significant opportunity to
grow its business in the area of managed services
this will facilitate the outsourcing to a sirius 
managed service of all or part of our larger 
customers’ sirius applications third party applications
and it infrastructure msp is a configurable offering
that frees our customers to focus on their principal
business activity whilst sirius manages their it needs
our msp service optionally provides hosting at a data
centre or at the customer’s own hosting centre  
i can report considerable interest in this new 
proposition in addition this will allow us to more
widely offer an application service provider asp
deployment model  
the first half of 2003 will see a period of investment
in our msp offering as we put in place the necessary
infrastructure and resources this may result in the
group incurring some oneoff set up costs an msp
capability will strengthen the group by allowing us to
sell additional services into our customer base tender
for new contracts and importantly build on our 
recurring revenue base by creating long term added
value contracts
acquisitions
throughout 2002 we identified and evaluated a
number of acquisition opportunities whilst we are
confident of the group’s ability to generate organic
growth there will undoubtedly be further 
consolidation in our sector we will continue to assess
acquisition opportunities and our move back to the
aim market will allow the group to complete suitable
acquisitions on a more cost effective basis
summary
the technology and insurance sectors continue to
experience challenging times although we have 
confidence in our ability to build on our recent 
successes we consider it prudent to set conservative
growth expectations for the coming year nevertheless
we aim to achieve increased sales for each of our
three products and to retain our focus on building a
profitable cash generative business
stephen j verrall
10 april 2003
strategy and outlook for 2003
2002 was undoubtedly an exceptional year for the
group to a certain extent this was anticipated with
the rollover of some business from 2001
nevertheless against the backdrop of a difficult 
market we produced our best ever results the group
we are today represents a significant uplift on our
2002 starting position i would like to take this
opportunity to thank all of sirius’ employees and of
course our customers for making this possible
2003
in 2003 we intend to build on our success
specifically we will
 maintain our primary aim to become a global 
leader in the provision of insurance software
 raise our profile with the larger players in the 
insurance underwriting market with the assistance
of our partners
 aim to retain and strengthen our position as a 
leading supplier to the uk’s insurance brokers 
backed by our biggest marketing campaign to 
date
 further develop and exploit our stargate 
technology for both commercial lines insurance 
and the financial services sector
 evaluate the opportunity to open a new office in 
either australia or new zealand to coincide with 
the implementation of our iag system thus 
providing local sales resource and support to 
prospective customers in this region  
 continue with our commitment to research and 
development activity much of which will be 
sponsored by specific customer projects
12