2 Basis of preparation

2.1 Statement of compliance

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (EU IFRS) and with Section 2:362(9) of the Dutch Civil Code. The consolidated financial statements have also been prepared on a historical cost basis, unless otherwise stated in the respective note or Note 3 Significant accounting policies.

2.2 Functional currency

These consolidated financial statements are presented in euro, which is the Company’s functional currency. All tables and amounts are in thousands of euros unless otherwise stated. In addition, all amounts have been rounded to the nearest thousand, unless otherwise indicated.

2.3 Use of estimates and judgements

The preparation of financial statements in conformity with EU IFRS requires the Board of Management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported values of assets and liabilities, income and expenses. The estimates and associated assumptions are based on past expe-rience and various other factors considered reasonable in the circumstances.

The estimates and underlying assumptions are assessed periodically. Any revised estimates are accounted for in the period in which they are revised, if such revision only affects that period, or the period in which the revision is made and future periods, if the revision has implications for both the period under consideration and future periods.

Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties as at 30 September 2022 that has significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities in the next financial year is included in the following notes:

  • Note 5 and 17 Measurement of unbilled services and trade receivables: in the measurement of ECL allowance for trade receivables and contract assets, key assumptions relate to the determination of the weighted-average loss rate.

Other areas that require management to make judgements, estimates and assumptions relate to deferred tax assets (assumptions include the availability of future taxable profit against which deductible temporary difference and tax losses carried forward can be utilized), intangible assets (in the impairment test of intangible assets and goodwill, key assumptions are included relating to underlying recoverable amounts, including the recoverability of development costs), provision for claims/legal proceedings (in the recognition and measurement of provisions and contingencies, key assumptions relate to the likelihood and magnitude of an outflow of resources) and financial instruments (key assumptions relate to the measurement of fair values as described below).

Measurement of fair values

A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

Management regularly reviews the Group’s significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then management assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of IFRS, including the level in the fair value hierarchy in which such valuations should be classified.

When measuring the fair value of an asset or a liability, management uses market observable data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

  • Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

  • Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

  • Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability might be categorized in different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

Management recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Further information about the assumptions made in measuring fair values is included in Note 25 Financial instruments and associated risks.

2.4 Going concern

The financial statements have been prepared on a going concern basis.

2.5 Changes in IFRS and other accounting policies/Accounting policies adopted for the preparation of the consolidated financial statements

The Group has adopted the following new standards, interpretations and/or amendments to a standard with a date of initial application of 1 October 2021 unless otherwise stated:

  • Amendments to IFRS 9, IAS 39 and IFRS 7: Interest Rate Benchmark Reform Phase 2;

  • Amendments to IFRS 16 Leases: Covid-19-Related Rent Concessions beyond 30 June 2021.

The implementation of the above-mentioned amendments did not have an effect on profit or equity. A number of other changes to IFRSs are not applicable to the Group.