RWS Annual Report 2022 web - Flipbook - Page 118
Notes to the Consolidated Financial Statements (continued)
Receivables, contract assets and contract liabilities with customers
Notes
2022
£m
2021
£m
Net trade receivables
15
148.9
133.7
Contract assets (accrued income)
15
51.2
34.9
Contract liabilities (deferred income)
17
(53.0)
(43.0)
Receivables, contract assets and contract liabilities
Contract assets are recognised where performance obligations are satisfied over time until the point at which the
Group's right to consideration is unconditional when these are classified as trade receivables which, is generally the
point of final invoicing.
For performance obligations satisfied over time, judgement is required in determining whether a right to consideration
is unconditional. In such situations, a receivable is recognised for the transaction price of the non-cancellable portion of
the contract when the Group starts satisfying the performance obligation. The Group recognises revenue for partially
satisfied performance obligations as ‘Accrued Income’, which is presented in note 15 to these financial statements.
The total value of the transaction price allocated to unsatisfied or partially unsatisfied performance obligations at the
year-end is £54.1m (2021: £49.1m). Support and maintenance is a stand ready obligation discharged straight line over
the duration of the Group’s software contracts, the period over which this is recognised can be identified based on the
value of current and non-current deferred income. Unsatisfied performance obligations in respect of language and
professional services are all short-term and expected to be recognised in less than one year.
The Group offsets any contract liabilities with any contract assets that may arise within the same customer contract,
typically, this only applies to the Group’s licence and support and maintenance revenue contracts. In all material
respects there are no significant changes in the Group’s contract asset or liability balances other than business-as-usual
movements during the year.
Revenue recognised in the year that was included in deferred revenue at 1 October 2021 was £40.8m (2021: £1.7m).
4. SEGMENT INFORMATION
The chief operating decision maker for the Group is identified as the Group’s Board of Directors collectively. The Board
reviews the Group’s internal reporting in order to assess performance and allocates resources. The Board divides the
Group into four reportable segments and assess the performance of each segment based on the revenue and adjusted
profit before tax. These measures are reconciled to the financial statements on page 160.
The four reporting segments, which match the operating segments, are explained in more detail below:
•
Language Services: The revenues are derived by providing localisation services which include translation and
adaptation of content across a variety of media and materials to ensure brand consistency.
•
Regulated Industries: Revenue is generated through the translation and linguistic validation for customers who
operate in regulated industries such as life sciences.
•
IP Services: The Group’s IP Services segment provides high quality patent translations, filing services and a broad
range of intellectual property (‘IP’) search services.
•
Language and Content Technology ('L&CT'): Revenue is generated through the provision of a range of translation
technologies and content platforms to clients. This was enhanced by the acquisition of Liones Holding B.V. in March
2022.
Unallocated costs reflect corporate overheads and other expenses not directly attributed to segments.
118
RWS — Annual Report 2022
NOTES TO THE CONSOLIDATED STATEMENTS
