25896939 2025-01-01 2025-12-31 25896939 2025-01-01 2025-12-31 1 25896939 2025-01-01 2025-12-31 1 25896939 2025-01-01 2025-12-31 2 25896939 2025-01-01 2025-12-31 3 25896939 2025-01-01 2025-12-31 4 25896939 2025-01-01 2025-12-31 5 25896939 2025-01-01 2025-12-31 1 25896939 2025-01-01 2025-12-31 Hovedtal EBITDA 25896939 2024-01-01 2024-12-31 Hovedtal EBITDA 25896939 2023-01-01 2023-12-31 Hovedtal EBITDA 25896939 2022-01-01 2022-12-31 Hovedtal EBITDA 25896939 2021-01-01 2021-12-31 Hovedtal EBITDA 25896939 2025-01-01 2025-12-31 Hovedtal Resultat foer skat 25896939 2024-01-01 2024-12-31 Hovedtal Resultat foer skat 25896939 2023-01-01 2023-12-31 Hovedtal Resultat foer skat 25896939 2022-01-01 2022-12-31 Hovedtal Resultat foer skat 25896939 2021-01-01 2021-12-31 Hovedtal Resultat foer skat 25896939 2024-01-01 2024-12-31 25896939 2025-12-31 25896939 2024-12-31 25896939 2025-01-01 c:ContributedCapitalMember 25896939 2025-01-01 c:ReserveForDevelopmentExpenditureMember 25896939 2025-01-01 c:RetainedEarningsMember 25896939 2025-01-01 2025-12-31 c:RetainedEarningsMember 25896939 2025-01-01 2025-12-31 c:ReserveForDevelopmentExpenditureMember 25896939 2025-12-31 c:ContributedCapitalMember 25896939 2025-12-31 c:ReserveForDevelopmentExpenditureMember 25896939 2025-12-31 c:RetainedEarningsMember 25896939 2025-01-01 25896939 2024-01-01 25896939 2025-01-01 c:CompletedDevelopmentProjectsMember 25896939 2025-01-01 c:GoodwillMember 25896939 2025-01-01 c:DevelopmentProjectsInProgressAndPrepaymentsForIntangibleAssetsMember 25896939 2025-01-01 2025-12-31 c:CompletedDevelopmentProjectsMember 25896939 2025-01-01 2025-12-31 c:GoodwillMember 25896939 2025-01-01 2025-12-31 c:DevelopmentProjectsInProgressAndPrepaymentsForIntangibleAssetsMember 25896939 2025-12-31 c:CompletedDevelopmentProjectsMember 25896939 2025-12-31 c:GoodwillMember 25896939 2025-12-31 c:DevelopmentProjectsInProgressAndPrepaymentsForIntangibleAssetsMember 25896939 2025-01-01 c:FixturesFittingsToolsAndEquipmentMember 25896939 2025-01-01 c:LeaseholdImprovementsMember 25896939 2025-12-31 c:FixturesFittingsToolsAndEquipmentMember 25896939 2025-12-31 c:LeaseholdImprovementsMember 25896939 2025-01-01 2025-12-31 c:FixturesFittingsToolsAndEquipmentMember 25896939 2025-01-01 2025-12-31 c:LeaseholdImprovementsMember 25896939 2025-01-01 c:InvestmentsInGroupEnterprisesMember 25896939 2025-01-01 c:DepositsLongtermInvestmentsAndReceivablesMember 25896939 2025-01-01 2025-12-31 c:InvestmentsInGroupEnterprisesMember 25896939 2025-01-01 2025-12-31 c:DepositsLongtermInvestmentsAndReceivablesMember 25896939 2025-12-31 c:InvestmentsInGroupEnterprisesMember 25896939 2025-12-31 c:DepositsLongtermInvestmentsAndReceivablesMember iso4217:DKK xbrli:pure BDO Statsautoriseret Revisionspartnerselskab Havneholmen 2, 6. sal DK-2450 København SV 45719375 Årsrapport 2026-03-05 Eivind Bergsmyr TIMELOG A/S Lindevangs Alle 12, 2. 2000 Frederiksberg Den uafhængige revisors erklæring 25896939 2001-02-07 Frederiksberg 2025-01-01 2025-12-31 2024-01-01 2024-12-31 BDO Statsautoriseret Revisionspartnerselskab Havneholmen 2, 6. sal 2450 Copenhagen S Today the Board of Directors and Executive Board have discussed and approved the Annual Report of TIMELOG A/S for the fi­nan­ci­al year 1 January  - 31 December 2025. The Annual Report is presented in accor­dance with the Da­nish Fi­nan­ci­al State­ments Act. In our opinion the Fi­nan­ci­al Sta­te­ments give a true and fair view of the Company's assets, liabilities and financial position at 31 December 2025 and of the results of the Company's operations and cash flows for the fi­nan­ci­al year 1 January  - 31 December 2025. The Management Commentary includes in our opinion a fair presentation of the matters dealt with in the Commentary. We recommend the Annual Report be approved at the Annual General Meeting. Frederiksberg 2026-02-27 Per-Henrik Ole Nielsen Eivind Bergsmyr Chairman Anne Lise Waal Sascha Elizabeth Houlberg Skydsgaard Martin Senning Eriksen Søren Lund To the Shareholders of TIMELOG A/S Konklusion We ha­ve au­di­ted the Fi­nan­ci­al Sta­te­ments of TIMELOG A/S for the fi­nan­ci­al year 1 January - 31 December 2025, which comprise income statement, Balance Sheet, sta­te­ment of chan­ges in e­qui­ty, cash flows, no­tes and a summary of significant accounting policies. The Fi­nan­ci­al Sta­te­ments are pre­pared in accordance with the Da­nish Fi­nan­ci­al State­ments Act.   In our o­pi­ni­on, the Fi­nan­ci­al Sta­te­ments give a true and fair view of the assets, liabilities and financial position of the Com­pa­ny at 31 December 2025 and of the results of the Com­pa­ny's operations and cash flows for the fi­nan­ci­al year 1 January - 31 December 2025 in accordance with the Da­nish Fi­nan­ci­al State­ments Act.   Basis for OpinionGrundlag for konklusion We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the “Auditor’s Responsibilities for the Audit of the Fi­nan­ci­al Sta­te­ments” section of our report. We are independent of the Com­pa­ny in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), together with the ethical requirements that are relevant to our audit of the Financial Statements in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We be­lie­ve that the e­vi­den­ce we ha­ve ob­tai­ned is suf­fi­ci­ent and ap­prop­ria­te to pro­vi­de a ba­sis for our con­clu­si­on.   Grundlag for konklusion Ma­na­ge­ment's Re­spon­si­bi­li­ti­es for the Fi­nan­ci­al Sta­te­ments Management is responsible for the preparation of Fi­nan­ci­al Sta­te­ments that give a true and fair view in accordance with the Da­nish Fi­nan­ci­al State­ments Act and for such Internal control as Ma­na­ge­ment determines is necessary to enable the preparation of Fi­nan­ci­al Sta­te­ments that are free from material misstatement, whether due to fraud or error.   In preparing the Fi­nan­ci­al Sta­te­ments, Ma­na­ge­ment is responsible for assessing the Com­pa­ny's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the Fi­nan­ci­al Sta­te­ments unless Management either intends to liquidate the Com­pa­ny or to cease operations, or has no realistic alternative but to do so.   Our objectives are to obtain reasonable assurance about whether the Fi­nan­ci­al Sta­te­ments as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Fi­nan­ci­al Sta­te­ments.   As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:   Identify and assess the risks of material misstatement of the Fi­nan­ci­al Sta­te­ments, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.   Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Com­pa­ny's internal control.   Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Ma­na­ge­ment.   Conclude on the appropriateness of Ma­na­ge­ment’s use of the going concern basis of accounting in preparing the Fi­nan­ci­al Sta­te­ments and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Com­pa­ny's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Fi­nan­ci­al Sta­te­ments or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Com­pa­ny to cease to continue as a going concern.   Evaluate the overall presentation, structure and contents of the Fi­nan­ci­al Sta­te­ments, including the disclosures, and whether the Fi­nan­ci­al Sta­te­ments represent the underlying transactions and events in a manner that gives a true and fair view.   We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.   Statement on Management Commentary Management is responsible for Ma­na­ge­ment Com­men­ta­ry.   Our opinion on the Fi­nan­ci­al Sta­te­ments does not cover Ma­na­ge­ment Com­men­ta­ry, and we do not express any form of assurance conclusion thereon.   In connection with our audit of the Fi­nan­ci­al Sta­te­ments, our responsibility is to read Ma­na­ge­ment Com­men­ta­ry and, in doing so, consider whether Ma­na­ge­ment Com­men­ta­ry is materially inconsistent with the Fi­nan­ci­al Sta­te­ments or our knowledge obtained during the audit, or otherwise appears to be materially misstated.   Moreover, it is our responsibility to consider whether Ma­na­ge­ment Com­men­ta­ry provides the information required under the Danish Financial Statements Act.   Based on the work we have performed, we conclude that Ma­na­ge­ment Com­men­ta­ry is in accordance with the Fi­nan­ci­al Sta­te­ments and has been prepared in accordance with the requirements of the Danish Financial Statements Act. However, we found that Ma­na­ge­ment Com­men­ta­ry do not contain the required information regarding future expectations according to the Danish Financial Statements Act.   Copenhagen 2026-02-27 BDO Statsautoriseret Revisionspartnerselskab 45719375 Mads Juul Hansen Den uafhængige revisors erklæring State Authorised Public Accountant mne44386 11929000 9135000 Operating profit/loss before depreciation and amortisation (EBITDA) Operating profit/loss before depreciation and amortisation (EBITDA) Operating profit/loss before depreciation and amortisation (EBITDA) Operating profit/loss before depreciation and amortisation (EBITDA) Operating profit/loss before depreciation and amortisation (EBITDA) 3914000 1630000 Profit/loss for the year before tax Profit/loss for the year before tax Profit/loss for the year before tax Profit/loss for the year before tax Profit/loss for the year before tax 0 0 35.8 38.2 67.8 63.3 9.4 16.0 During the financial year the Company has transitioned from preparing its annual report in accordance with the Danish Financial Statements Act for accounting class B to preparing its annual report in accordance with the Danish Financial Statements Act for accounting class C (medium), the exemption provision regarding disclosure of financial highlights and key ratios for the periods 2021, 2022 and 2023 has been applied. Consequently, only financial highlights and key ratios for the comparative figures 2024 and the current financial year 2025 are disclosed.   The ratios stated in the list of key figures and ratios have been calculated as follows:   Invested capital: NWC + intangible and tangible assets (ex goodwill) – provisions – other operating liabilities, non-current Return on invested capital: Operating Profit/loss adjusted for goodwill amortisation x 100          Average invested capital Equity ratio:  Equity, at year-end x 100 Total assets, at year-end Return on equity: Profit/loss after tax x 100        Average equity Principal activities TimeLog A/S develops and implements web-based PSA solutions (Professional Services Automation) towards the Northern European market. The company's business model is based on SaaS (Software as a Service) and the majority of the company's income is based on a fixed contractual basis with long-term contracts with an average Life-Time-Value of more than 10 years.    Development in activities and financial and economic position During 2025, TimeLog A/S continued its operations within web-based PSA solutions and maintained focus on subscription-based revenue and operational scalability in the Northern European market. The Company realised an increase in operating profit compared to 2024. The development was primarily driven by recurring revenue from the existing customer base combined with continued cost control. The SaaS business model with long-term contracts contributes to predictable revenue streams. Operating cash flow improved during the year. Investments were mainly related to development of the software platform, resulting in an increase in recognised intangible assets. Equity increased as a consequence of the profit for the year. Management considers the development in the Company’s activities and financial position for the year satisfactory.   Profit/loss for the year compared to the expected development As the Company has not previously disclosed expectations for the future in accordance with section 99(1)(5) of the Danish Financial Statements Act, due to the fact that this is the Company’s first financial year in which the annual financial statements are prepared in accordance with the provisions of the Danish Financial Statements Act for accounting class C (medium), no follow-up on profit/loss for the year compared to the expected development from previous financial years has been provided.   Research and development activities The Company continuously develops its PSA platform to support its product offering and maintain competitiveness. During the year, development activities primarily related to further development of the unified platform architecture (“One Product”). The purpose of these activities is to improve functionality, performance and standardisation of the platform and thereby support implementation and use by customers. Development work mainly consists of internal development hours carried out in defined projects where technical feasibility and expected commercial value are assessed. When the recognition criteria are met, development costs are capitalised and amortised over their expected useful life. Management expects to continue product development activities in order to support the Company’s future operations and revenue base.   Future expectations Based on the existing customer base and current activity level, TimeLog A/S expects continued growth in its subscription business.  For the financial year 2026, the Company expects healthy growth in Annual Recurring Revenue (ARR) and a positive operating cash flow. No unusual uncertainties related to the Company’s operations are currently expected beyond normal market conditions for software companies operating in Northern Europe.   The Company’s foreign branches Name: TimeLog Filial i Sverige Domicil: 114 57 Stockholm, Sweden   Treasury shares 20252024 DKKDKKThe amount of own shares comprise of: 2144, 1 unit in the denomination of 2.144 DKK2.1442.144 2.1442.144 Own shares in % of share capital: TimeLog A/S0,20,2 0,20,2 2144 2144 0.2 0.2 51201942 48856088 39272835 39720960 8174277 7266300 3754830 1868828 194084 137464 35329 376027 3913585 1630265 -210323 -4552456 4123908 6182721 17063432 15776179 17500174 20416869 10003630 7346610 44567236 43539658 0 53356 124958 201856 124958 255212 297556 297556 1202397 1181559 1499953 1479115 46192147 45273985 5196329 6451156 314103 314103 5050823 4593000 265725 239611 952468 1703345 11779448 13301215 9783256 7514855 21562704 20816070 67754851 66090055 909342 909342 21112308 18035776 23914082 22866706 45935732 41811824 3632676 5771520 271921 77821 13775006 13260620 21819119 24278231 21819119 24278231 67754851 66090055 DKKSha­re ca­pi­talReserve for development costsRetained earningsTotal Equity at 1 January 2025909.34218.035.77622.866.70641.811.824 Proposed profit allocation, see note 5 4.123.9084.123.908 Other legal bindingsCapitalized development costs 9.071.600-9.071.6000 TransfersDepreciations -5.127.3275.127.3270 Tax on changes in equity -867.741867.7410 Equity at 31 December 2025909.34221.112.30823.914.08245.935.732 909342 18035776 22866706 4123908 9071600 -9071600 -5127327 5127327 -867741 867741 909342 21112308 23914082 4123908 6182721 8174277 7266300 -210323 -4552456 0 706381 -53400 -170144 1979589 -4569789 -2653212 -99034 11360839 4763979 -9071600 -7346610 -20838 -18877 -9092438 -7365487 2268401 -2601508 7514855 10116363 9783256 7514855 1 | Staff costs Ave­ra­ge num­ber of full ti­me em­ploy­ees5062 Wages and salaries 33.815.26436.048.289 Pensions 4.976.3333.078.049 Social security costs 481.238594.622 39.272.83539.720.960 Remuneration of Management and Board of Directors 1.478.1181.425.641 1.478.1181.425.641 50 62 33815264 36048289 4976333 3078049 481238 594622 39272835 39720960 1478118 1425641 2 | Other financial income Interest income from group enterprises 0188 Other interest income 194.084137.276 194.084137.464 0 188 194084 137276 194084 137464 3 | Other financial expenses Other interest expenses 35.329376.027 35.329376.027 35329 376027 35329 376027 247500 26550 0 -706381 -457823 -3872625 5 | Proposed distribution of profit Retained earnings 4.123.9086.182.721 4.123.9086.182.721 4123908 6182721 4123908 6182721 6 | Intangible assets DKKDevelopment projects completed, including patents and similar rights originating from development projectsGoodwillDevelopment projects in progress and prepayments for intangible assets Cost at 1 January 2025 20.798.05630.021.9567.346.610 Transfer 6.414.5800-6.414.580 Additions 009.071.600 Cost at 31 December 2025 27.212.63630.021.95610.003.630   Amortisation at 1 January 2025 5.021.8779.605.0860 Amortisation for the year 5.127.3272.916.6960 Amortisation at 31 December 2025 10.149.20412.521.7820 Carrying amount at 31 December 202517.063.43217.500.17410.003.630 The development projects outlined herein pertain to the enhancement of existing functionalities or the creation of new modules aimed at enhancing the use for both current customers and prospective customers of TimeLog.  Costs associated with these projects predominantly comprise internal expenditures, delineated by hours logged through the company's internal time registration system. The software is expected to be sold in the present markets to both the company’s new and existing customers. Completed development projects are depreciated over 5 years. The upward trajectory in the number of users engaging with the company’s platform bolsters management’s confidence in the platform's sustained value proposition. 20798056 30021956 7346610 6414580 0 -6414580 0 0 9071600 27212636 30021956 10003630 5021877 9605086 0 5127327 2916696 0 10149204 12521782 0 17063432 17500174 10003630 7 | Property, plant and equipment DKKOther plant, fixtures and equipmentLeasehold improvements Cost at 1 January 2025 1.602.114384.800 Cost at 31 December 2025 1.602.114384.800   Depreciation and impairment losses at 1 January 2025 1.548.757182.945 Depreciation for the year 53.35776.897 Depreciation and impairment losses at 31 December 2025 1.602.114259.842 Carrying amount at 31 December 20250124.958 1602114 384800 1602114 384800 1548757 182945 53357 76897 1602114 259842 0 124958 8 | Financial non-current assets DKKInvestments in subsidiariesRent deposit and other receivables Cost at 1 January 2025 297.5561.181.559 Additions 020.838 Cost at 31 December 2025 297.5561.202.397   Carrying amount at 31 December 2025297.5561.202.397 Investments in subsidiaries (DKK) Name and domicilEquityProfit/loss for the yearOwnership Autopilot Plus Ltd., United Kingdom 117-22100 % 297556 1181559 0 20838 297556 1202397 297556 1202397 9 | Deferred tax assets The provision for deferred tax is related to differences between the carrying amount and tax value of securities, receivables, intangible and tangible fixed assets, including recognised finance lease contracts. 20252024 DKKDKK Deferred tax assets, beginning of year 4.593.000720.375 Deferred tax of the year, income statement 457.8233.872.625 Deferred tax assets 31 December 20255.050.8234.593.000 Tax loss carryforwards are recognized based on an assessment of whether it is reasonably probable that it can be utilized against future taxable income within a relatively short period of 3 years. The assessment is made on the basis of approved budgets. Tax loss carryforwards are recognized based on an assessment of whether it is reasonably probable that it can be utilized against future taxable income within a relatively short period of 3 years. The assessment is made on the basis of approved budgets. 10 | Prepayments Prepayments are amounts paid for the group in advance of goods and services. 20252024 DKKDKK 11 | Sha­re ca­pi­talAllocation of Share capital: TimeLog A/S shares, 909.342 unit in the denomination of 1 DKK909.342909.342 909.342909.342 12 | Deferred income Deferred revenue comprises accrued licence income from the Company’s principal activities, which is recognised over the licence period in accordance with the Company’s accounting policies. 2025 DKK Other financial commitments Other financial commitments consists of liabilities under rental or lease agreements until maturity. The total other financial commitments as of the balance sheet date amount to: 4.091.682 14 | Related parties The Company's related parties include: AutoPilot Plus Limited, 27 Greville Street, London, Reg. number 12699659 Controlling interest There is no ultimate Parent, as no owner holds the majority of the voting rights. Transactions with related parties The Company did not carry out any material transactions that were not concluded on market conditions. According to section 98c, subsection 7 of the Danish Financial Statements Act information is given only on transactions that were not performed on common market conditions. 15 | Significant events after the end of the finan­cial year No events have occurred after the balance sheet date which would influence the conclusions in this annual report. The Annual Report of TIMELOG A/S for 2025 has been presented in accor­dance with the pro­vi­sions of the Da­nish me­di­um-si­ze Fi­nan­ci­al State­ments Act for en­ter­pri­ses in re­por­ting class C .  Regnskabsklasse C, mellemstor virksomhed1trueThe Annual Report is prepared with the following accounting principles.   Regnskabsklasse C, mellemstor virksomhed true Consolidated Financial Statements are not prepared because the Group fulfils the requirements for exemption in section 111 of the Danish Financial Statements Act.   Net revenue Sale of services is generally recognised on the basis of a measurable degree of completion, using straight-line recognition of services delivered over time in a regular pattern. Where the degree of completion is not measurable or the sales value or the total costs of completion are uncertain, revenue is recognised by the amount that the enterprise as a maximum believes to have a right to claim and is expected to be received for services delivered at the Balance Sheet date.   Net revenue is recognised exclusive of VAT and less duties and discounts related to the sale.   Costs of raw materials and consumables Raw materials and consumables comprises the costs of raw materials and consumables used to reach the revenue for the year. Additionally, decrease or increase of inventories of raw materials and consumables for the year is included, as well as normal impairment of inventories of raw materials and consumables.   Other operating income Other operating income includes items of a secondary nature in relation to the enterprises' principal activities, including profit from sale of intangible and tangible assets, operating loss and conflict compensations, as well as salary refunds. Compensations are recognised when the income is estimated to be realisable.    Own work capitalised Own work capitalised comprises staff costs and other costs incurred in the financial year and recognised in cost for proprietary intangible assets.   Other external expenses Other external expenses include other production, sales, delivery and administrative costs, including costs of energy, marketing, premises, loss on bad debts,  lease expenses, etc   Staff costs Staff costs comprise wages and salaries, including holiday pay and pensions, and other costs of social security etc., for the Com­pa­ny's employees.   Income from investments in subsidiaries Dividend from sub­si­dia­ri­es is recognised in the financial year in which the dividend is declared. In connection with transfers, potential profits are recognised when the economic rights related to the sold equity interests are transferred, however, at the earliest when the profit has been realised or is regarded as realisable. Moreover, realised losses other than impairments are included where identified.   Financial income and expenses Financial income and expenses include interest income and expenses, financial expenses of finance leases, realised and unrealised gains and losses arising from securities, debt and transactions in foreign currencies, as well as charges and allowances under the tax-on-account scheme, etc. Financial income and expenses are recognised by the amounts that relate to the financial year. Interest income and expenses are calculated on amortised cost prices.   Tax The tax for the year, which consists of the current tax for the year and changes in deferred tax, is recognised in the Income Statement by the share that may be attributed to the profit for the year, and is recognised directly in equity by the share that may be attributed to entries directly to equity.   Intangible fixed assets Acquired goodwill is measured at cost less accumulated amortisation. Goodwill is amortised on a straight-line basis over the expected useful life which is estimated to 10 years. The period of amortisation is determined based on an assessment of the acquired Company’s position in the market and earnings profile, and the industry-specific conditions. Development projects on clearly defined and identifiable products and processes, for which the technical rate of utilisation, adequate resources and a potential future market or development opportunity in the enterprise can be established, and where the intention is to manufacture, market or apply the product or process in question, are recognised as intangible assets. Other development costs are recognised as costs in the income statement as incurred. When recognising development projects as intangible assets, an amount equalling the costs incurred less deferred tax is taken to equity in the reserve for development costs that is reduced as the development projects are amortised and written down. The cost of development projects comprises costs such as salaries and amortisation that are directly and indirectly attributable to the development projects.   Development projects comprise costs, including wages and salaries, and amortisation, which directly or indirectly can be related to the Company’s development activities and which fulfil the criteria for recognition in the Balance Sheet.   The accounting item is measured at the lower of the capitalised costs less accumulated amortisation and recoverable amount.   Capitalised development costs are amortised on a straight-line basis over the estimated useful life after completion of the development work. The amortisation period is normally 5 years.   Intangible fixed assets are generally written down to the recoverable amount if this is lower than the carrying amount.   Profit or loss from sale of intangible fixed assets is calculated at the difference between the sales price and the carrying amount at the time of the sale. Profit and loss are recognised in the Income Statement under other operating income or other operating expenses.    Property, plant and equipment Other plant, fixtures and equipment and leasehold improvements measured at cost less accumulated depreciation and impairment losses.   The depreciation base is cost less estimated residual value after end of useful life.   The cost includes the acquisition price and costs incurred directly in connection with the acquisition until the time when the asset is ready to be used.    Straight-line depreciation is provided on the basis of an assessment of the expected useful lives of the assets and their residual value:   Useful lifeResidual valueOther plant, fixtures and equipment  3-5 years0 %Leasehold improvements  5 years0 % Profit or loss on sale of property, plant and equipment is stated as the difference between the sales price less selling costs and the carrying amount at the date of sale. Profit or loss is recognised in the Income Statement as other operating income or other operating expenses.   Financial non-current assets Investments in sub­si­dia­ri­es are measured at cost. If the cost exceeds the net realisable value, this is written down to the lower value.   Engelsk   Land and buildings, plants and machines, as well as other fixtures, fittings, tools and equipment are measured at cost with deduction of accumulated depreciations. Land is not depreciated. Investment properties are measured at fair value corresponding to the open market value of the property, where changes to the fair value are recognised in the Income Statement. Inventories are measured at cost according to the FIFO principle with deductions of any depreciations at a lower net realisation value. Receivables and payables are measured at amortised cost.   Received dividend is deducted in the carrying amount of the equity investment.   The combination method is applied when merging enterprises within the Group, where the combination is regarded as completed from the earliest financial period included in the Financial Statements, and by using the carrying amounts of the assets and liabilities acquired.   The difference between the acquisition cost and carrying amounts is recognised directly in equity.   The portfolio of mortgage deeds includes mortgages, that are expected to be held to maturity and are measured at amortised cost.   Impairment of fixed assets The carrying amount of in­tan­gib­le fi­xed and pro­per­ty, plant and equip­ment to­get­her with fi­xed as­sets, which are not mea­su­red at fair va­lue,, are assessed annually for indications of impairment other than that reflected by amortisation and depreciation.   In the event of impairment indications, an impairment test is made for each asset or group of assets, respectively. If the recoverable amount is lower than the carrying amount, the asset is written down to the recoverable amount.   The recoverable amount is calculated at the higher of the capital value and the sales value less expected costs of a sale. The capital value is determined as the Company's share in the current value of the net cash flows which the subsidiary is expected to generate through its activities and from sale of assets after the end of their useful lives. A discount rate is used which reflects the risk-free market rate and the owners' minimum return on interest requirements for similar assets. The growth rate in the terminal period is determined in accordance with the standards within the industry.   Receivables Receivables are measured at amortised cost which usually corresponds to nominal value. The value is written down to meet expected losses.   Write-off is performed to provide for losses when an objective indication has been assessed to have incurred that a receivable or a portfolio of receivables are impaired. If there is an objective indication that an individual receivable is impaired, the write-off is performed at individual level.   Receivables for which there are no objective indication of impairment at individual level are assessed at portfolio level for objective indication of impairment. The portfolios are primarily based on the debtors’ registered office and credit rating in accordance with the Company’s policy for credit risk management. The objective indicators, which are applied for portfolios, are determined based on the historical loss experiences.   Write-off is determined as the difference between the carrying amount of receivables and the present value of the expected cash flows, including realisable value of any received collaterals. The effective interest rate is used as discount rate for the single receivable or portfolio.   Accruals, assets Accruals recognised as assets include costs incur­red relating to the subsequent financial year.   Equity Reserve for development costsThe reserve includes recognised post-tax development costs, which are capitalised as intangible assets. The reserve is reduced concurrently with depreciation of the intangible asset and is dissolved if the asset is discontinued from the operation of the company. Reduction of the reserve takes place via transferring directly to the distributable reserves of the equity.   Treasury shares Acquisition costs and considerations for treasury shares are recognised directly in Equity under retained earnings. Thus, gains and losses from sales are recognised in Equity.  Dividend of treasury shares are recognised directly in Equity under retained earnings. Capital reduction by way of cancelling treasury shares reduces the contributed capital by an amount equal to the nominal value of the treasury shares and increases the retained earnings.   Tax payable and deferred tax Current tax liabilities and receivable current tax are recognised in the Balance Sheet as the calculated tax on the taxable income for the year, ad­justed for tax on the taxable income for previous years and taxes paid on account.   Deferred tax is measured on the temporary dif­ferences between the carrying amount and the tax value of assets and liabilities.   Deferred tax assets, including the tax value of tax loss carryforwards, are measured at the amount at which the asset is expected to be used within a reasonable number of years, either by setoff against tax on future earnings or by setoff against deferred tax liabilities within the same legal tax entity.   Deferred tax is measured on the basis of the tax rules and tax rates that under the legislation in force on the Balance Sheet date will be ap­pli­cable when the deferred tax is expected to crystallise as current tax. Any changes in the deferred tax resulting from changes in tax rates, are recognised in the income statement, except from items recognised directly in equity.   Liabilities Financial liabilities are recognised at the time of borrowing by the amount of proceeds received less transaction costs. In subsequent periods, the financial liabilities are measured at amortised cost equal to the capitalised value when using the effective interest, the difference between the proceeds and the nominal value being recog­nised in the Income Statement over the loan period.   The amortised cost of current liabilities corresponds usually to the nominal value.   Accruals, liabilities Accruals recognised as liabilities include payments received regarding income in subsequent years.   Foreign currency translation Transactions in foreign currencies are translated at the rate of exchange on the transaction date. Exchange differences arising between the rate on the transaction date and the rate on the payment date are recognised in the Income Statement as a financial income or expense. Receivables, payables and other monetary items in foreign currencies that are not settled on the Balance Sheet date are translated at the exchange rate on the Balance Sheet date. The difference between the exchange rate on the Balance Sheet date and the exchange rate at the date when the receivables or payables come into existence recognised in the Income Statement as financial income or expenses. Fixed assets acquired in foreign currencies are translated at the rate of exchange on the transaction date. Cash Flow Statement   The cash flow statement shows the cash flows for the year for operating activities, investing activities and financing activities in the year, the change in cash and cash equivalents at beginning and end of the year.   Cash flows from operating activities:Cash flows from operating activities are computed as the results for the year adjusted for non-cash operating items, changes in net working capital and corporation tax paid.   Cash flows from investing activities:Cash flows from investing activities include payments in connection with purchase and sale of intangible and tangible fixed asset and fixed asset investments.   Cash flows from financing activities:Cash flows from financing activities include changes in the size or composition of share capital and related costs, and borrowings and repayment of interest-bearing debt and payment of dividend to shareholders.   Cash and cash equivalents:Cash and cash equivalents include cash at bank and in hand and short-term securities, for which there is only negligible risk of changes in value, and which are readily negotiable for cash at bank and in hand.