Peachtree 2015 Annual Report Download - page 155

The Sage Group plc | Annual Report & Accounts 2015 153
FINANCIAL STATEMENTSGOVERNANCESTRATEGIC REPORT
O
verv
i
ew
St
ra
t
eg
i
c repor
t G
overnance
Fi
nanc
i
a
l
s
t
a
t
emen
t
s
F of isitions £m
Intangible assets (note 6) 34.2
Property, plant and equipment (note 7) 1.0
Trade and other receivables 1.6
Cash and cash equivalents 29.6
Trade and other payables (32.6)
Current borrowings (2.6)
Non-current borrowings (19.6)
Deferred tax assets 4.6
Provisions (note 9) (0.6)
Total net identifiable assets acquired 15.6
Goodwill 59.6
Total purchase consideration 75.2
The goodwill on acquisition relates to the growth opportunities through both customer acquisition and cross-sell to the combined
customer base. Included within cash and cash equivalents is £28.7m of cash held on behalf of customers with a corresponding liability
within trade and other payables.
The outflow of cash and cash equivalents on the acquisitions is calculated as follows: £m
Cash consideration 75.2
Cash and cash equivalents acquired (29.6)
Borrowings acquired 22.2
Deferred consideration, paid on prior period acquisitions 1.7
Net cash outflow in respect of acquisitions 69.5
15.2 Contribution of acquisitions
From the dates of the acquisitions to 30 September 2015, the acquisitions contributed £27.5m to revenue and generated a loss before tax
of £5.5m. Had these acquisitions occurred at the beginning of the financial year, contribution to Group revenue would have been £28.8m and
the contribution to Group profit before tax would have been a loss of £5.8m.
15.3 Costs relating to business combinations in the year
Costs relating to business combinations in the year of £2.0m (2014: £2.4m) have been included in selling and administrative expenses in the
Consolidated income statement. These acquisition-related items relate to completed transactions and include advisory, legal, accounting,
valuation and other professional or consulting services.
16 Related party transactions
This note discloses any transaction by the Group with related parties, which are classified as companies or individuals who have an
interest in the Group, including joint ventures, associated undertakings, investments and key management personnel.
The Group’s related parties are its subsidiary undertakings and Executive Committee members. The Group has taken advantage of the
exemption available under IAS 24, “Related Party Disclosures”, not to disclose details of transactions with its subsidiary undertakings.
Compensation paid to the Executive Committee is disclosed in note 3.3.
Supplier transactions occurred during the year between Sage South Africa (Pty) Ltd, one of the Group’s subsidiary companies, and Ivan
Epstein, President, International and Executive Committee member. These transactions relate to the lease of four properties in which Ivan
Epstein has a minority and indirect shareholding. During the year £4.3m (2014: £3.2m) relating to these transactions was charged through
selling and administrative expenses. There were no outstanding amounts payable for the year ended 2015 (2014: £nil).
Supplier transactions occurred during the year between Sage SP, S.L., one of the Group’s subsidiary companies, and Álvaro Ramírez, who
held the role of President, Europe and Executive Committee member during the year. These transactions relate to the lease of a property in
which Álvaro Ramírez has a minority shareholding. During the year £1.0m (2014: £1.1m) relating to these transactions was charged through
selling and administrative expenses. There were no outstanding amounts payable for the year ended 2015 (2014: £nil).
These arrangements are subject to independent review using external advisers to ensure all transactions are at arm’s length.