General principles
1_Basis of accounting
Software AG's condensed and unaudited consolidated financial statements (quarterly financial statements) as of March 31, 2009, have been prepared in accordance with the International Financial Reporting Standards (IFRS ) applicable on the balance sheet date, as endorsed by the EU. The IAS s/IFRS s applicable as of March 31, 2009, were observed, as were the corresponding interpretations of the International Financial Reporting Interpretations Committee (IFRIC – formerly SIC).
Software AG is a joint stock corporation under German law with registered offices in Darmstadt. The Company is the parent company of a Group which is active in the fields of development, licensing, and maintenance of software, as well as IT services.
The consolidated financial statements of Software AG are expressed in thousands of euros unless stated otherwise.
2_Changes in the consolidated group
Software AG gained control over itCampus Software- und Systemhaus GmbH, Leipzig (itCampus) on March 2, 2009, by acquiring 51 % of its shares. itCampus controls four subsidiaries. Additional notes on the acquisition of itCampus can be found under Note 4 (Business acquisitions). The acquisition resulted in the following additions to the consolidated group:
- itCampus GmbH, Leipzig, Germany
- itCampus UK, Limited, Newcastle Upon Tyne, United Kingdom
- itCampus Schweiz AG , Sursee, Switzerland
- itCampus Sarix Italia GmbH, Bozen, Italy
- itCampus Informationstechnologie Austria GmbH, Wiener Neudorf, Austria
The subsidiaries of itCampus GmbH were not consolidated, because they are immaterial for the Group’s financial position, financial performance and cash flows. They are recognized at cost.
3_Accounting policies
The same accounting policies have been applied as in the consolidated financial statements as of December 31, 2008. Accordingly, accounting policies are not explained in detail in these quarterly financial statements. These quarterly financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting.
4_Business acquisitions
By acquiring 51% of its shares, Software AG gained control over itCampus Software- und Systemhaus GmbH, Leipzig (itCampus), a supplier of software and communication solutions for the call center, energy, medicine, and public administration industries.
The purchase price of this acquisition was settled in cash and totaled €4,571 thousand after deducting acquired cash funds. There were no significant directly attributable costs in connection with the acquisition. The purchase price was broken down as follows, based on a preliminary calculation:
| in € thousands | Carrying
amount before acquisition | Adjustment
| Initial
|
| Cash and cash equivalents | 1,429 | 1,429 | |
| Inventories | 400 | 400 | |
| Trade receivables | 1,135 | 1,135 | |
| Other receivables and other assets | 333 | 333 | |
| Intangible assets | 172 | 5,917 | 6,089 |
| Property, plant and equipment | 258 | 258 | |
| Financial assets | 603 | 603 | |
| Assets | 4,330 | 5,917 | 10,247 |
| Financial liabilities | 2,140 | 2,140 | |
| Trade payables | 381 | 381 | |
| Other liabilities | 1,494 | 1,494 | |
| Other provisions | 190 | 190 | |
| Tax provisions | 0 | 1,817 | 1,817 |
| Deferred tax liabilities | 258 | 258 | |
| Net assets | -35 | 4,100 | 4,065 |
| Minority interest | -2,009 | ||
| Goodwill | 3,994 | ||
Payments to shareholders | 2,900 | ||
Payment to the company for capital increase | 3,100 | ||
| Acquisition costs | 6,000 | ||
| Acquired cash and cash equivalents | 1,429 | ||
| Acquisition costs net of acquired cash | 4,571 |
Due to the short time between the acquisition date and the reporting date of the quarterly financial statements on March 31, 2009, itCampus was consolidated for the first time on a provisional basis.
The intangible assets measured at fair value during the purchase price allocation are comprised of mainly software. The innovative employees represent an additional material asset that nevertheless may not be capitalized separately from goodwill in accordance with IFRS 3.
The acquired company’s contribution to revenue and profits since the acquisition date is immaterial.
