1 Material accounting policies continued Financial liabilities at amortised cost continued Borrowings Interest-bearing bank loans are initially recorded at their fair value and subsequently held at amortised cost. Transaction costs incurred are amortised over the term of the loan. Assets held for sale Assets are classified as held for sale if their carrying amount is to be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable within one year from the date of classification and the assets are available for sale in their present condition. Assets held for sale are stated at the lower of the carrying amount and fair value less costs to dispose. Discontinued operations A discontinued operation is a component of the Group that has been disposed of or is classified as held for sale and represents a separate major line of business or geographical area of operation. In accordance with IFRS 5, the post-tax results of discontinued operations and any post-tax gain or loss on disposal or remeasurement to fair value less costs to sell are presented as a single amount in the Consolidated Income Statement. When classified as held for sale, the assets and liabilities of discontinued operations are presented separately in the Consolidated Balance Sheet. Cash flows relating to discontinued operations are disclosed separately in Note 16, including operating, investing and financing activities. Further disclosures, including a breakdown of the Income Statement components and earnings per share from discontinued operations, are provided in the Notes to the Financial Statements. Revenue recognition Summary The Group provides independent global Cyber Security and Escode services. Cyber Security During the 16 month period ended 30 September 2024, as part of the Group’s ongoing transformation and the implementation of its new strategy, the Group began to analyse Cyber Security revenue in greater detail by service type and capability, which replaced the previous revenue streams of Global Managed Services (GMS) and Global Professional Services (GPS), as reflected within the prior year segmental information note (Note 3). This change in analysis enables the Group to better focus on existing customers, as well as on simplifying operations and the core services it provides. During the year ended 30 September 2025, the Group has updated its revenue recognition policy to better align with the revenue streams disclosed in Note 3 (segmental information). This update has no impact on the timing or recognition of revenue under IFRS 15 for the current year or prior period. The revenue streams in relation to Cyber Security include: • Managed Services (MS) – operational cyber defence, scanning, simulation and managed security operations centres (SOCs) including Microsoft XDR (Sentinel) propositions. In the prior period, this revenue stream was reported under the Global Managed Services revenue recognition accounting policy, as disclosed in Note 1 of the 2024 Annual Report. • Digital Forensics and Incident Response (DFIR) – incident response including rapid global support during and after cyber attacks. In the prior period, this revenue stream was reported under the Global Managed Services revenue recognition accounting policy, as disclosed in Note 1 of the 2024 Annual Report. • Technical Assurance Services (TAS) and Consulting and Implementation (C&I) – global Cyber Security consultancy services. In the prior period, these revenue streams were reported under the Global Professional Services revenue recognition accounting policy, as disclosed in Note 1 of the 2024 Annual Report. • Other services – sale of own manufactured and/or resale of third party products. In the prior period, this revenue stream was reported under the product sales revenue recognition accounting policy, as disclosed in Note 1 of the 2024 Annual Report. Escode The revenue streams in relation to Escode include: • Escrow contract services – securely maintain in “escrow” the long-term availability of business-critical software and applications. • Verification services – verify source code, and provide a fully managed secure service and result validation. While the detailed recognition is contract specific, and set out in the table on pages 116 to 119, in most cases: • TAS, C&I and DFIR revenues are recognised on an input method over time. • MS revenues are bifurcated according to the separated performance obligations (see pages 116 and 117). • Other services revenues are recognised when control passes, usually on delivery. • Escrow contract revenues are recognised over time. • Verification services are recognised on the completion of the verification service. Revenue is presented net of VAT and other sales related taxes. Revenue is measured based on the consideration specified in a contract with a customer. The Group recognises revenue when it transfers control over a good or service to a customer. The Group does not have any material obligations in respect of returns, refunds or warranties. The impact of any financing component within contracts with customers has been assessed and concluded to be immaterial. On contract inception, the probability of collectability is assessed across the Group and, unless there is a significant change in facts and circumstances, revenue is recognised. During the year or prior period, no instances have been identified where the collectability has had to be reassessed, nor have there been any new contracts with customers for which the collection of consideration has not been assessed at inception as probable.
NCC Group plc — Annual report and accounts for the year ended 30 September 2025 115
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