Original subtitles

you were last year if you sort of walk us through the end -to -end process so

how they're presented to the gf talk committee um calculation of

amortization um how impairments calculated um any sort of approval

along the way um and um how it's recorded as well

okay so to just be clear i guess there's kind of two There's two

parts to this kind of conversation.

The first one would be the overarching question about any intangible assets

is recorded by the group, which

obviously there are relatively small, immaterial,

intangible assets held in the likes of Wealth Wizards.

and responsible uh in relation to certain software purchase developments

that they've got they're obviously kind of not really on the kind of group

materiality kind of scale can't talk to those in much detail other than saying

they're pretty small fry um and then separately there's obviously using

intangible assets at the alarm level in relation to the ladin implementation

um which they

followed similar process to what we've established for group for the think

beyond intangible asset right so all those bits technically are part

of the scope of what you're kind of talking to here but but realistically i

wasn't planning on talking to those per se and maybe just more focusing on the

think beyond that so is that kind of what you are looking for right yeah that

was our understanding as well i think at the more granular level we i mean i i

wasn't involved in the the subsidiary walkthroughs but i would have thought

have we'd have covered those there um especially for the for the likes of all

and they'll go into more detail of those on their audit so um yeah you you're on

the right landing in terms of what we're looking for yeah okay so i suppose kind

of probably from a think beyond perspective if i do my jibber jabber

might hopefully make sense but it's not chronologically working um i guess the

actual intangible asset that we're recording so the capitalization element

based on the the framework that was established when we we started

capitalizing again in i'm going to say 2020 from the 2021 year end

I think.

Yes, you're right.

Thanks,

Elaine. So, yeah, so we stopped capitalising for a short period after we

did an impairment of the asset in,

again, Elaine, you might pick out the year, but was it 18 or 19? There was an

impairment. It was 19, the impairment.

i'm glad that i'm at least broadly close so um so yeah so um so when when

we kind of restarted capitalization we kind of established the the framework of

what cost we would capitalize and that was done based on a review of the uh of

how those costs were being kind of grouped together um uh and

fundamentally although there were a couple of um

A couple of kind of captions for which we were capitalizing, maybe percentages

of the total.

For the most part, it was capitalization of design costs that were classified as

design, build and test, being the ones that ultimately contribute to the, I

guess, the developed asset.

And so there was the accounting, technical accounting review of those

categories and classifications.

in which would have probably been early 2022 as part of the year end 2021 kind

of finalization and subsequent to that we have just applied that continue to

apply that model um to the cost information

which Elaine provides to us so obviously Elaine is um

looking at the the project and the detail um the detailed kind of

costs that are flowing through the project sub legend so she can kind of

that level of detail but ultimately as those those costs get summarized to me

the level of is it design build test is it something else each

month and but once a quarter i will take those costs and

add them up and capitalize the design build test is more or less as simple as

that earlier on in the process There were effectively three work

streams to the capitalization process because there were effectively

three kind of distinct kind of aspects.

There was the PPR, the core kind of PPIR kind of product. There was a kind of a

separate kind of release 105, which is.

ultimately linked to the PPIR product and then there's a completely separate

product in the the ISO product that the ISO workstream that is continues to be

ongoing the first two we stopped capitalization on when we

or the PPIR product we stopped capitalization on in July

2023 might have got that year wrong but that's somewhere around then basically

when the contract started for

our 10 -year maintenance contract with Sonata.

So we kind of stopped capitalizing then.

The asset was effectively brought into use initially at that point, and then

obviously subsequently.

um that was the non -advised drawdown element but the product was brought to

and then there's been a full launch since etc etc blah blah anyway we've

capitalizing that we also stopped capitalizing the people the release 105

components shortly thereafter um but that was a relatively kind of smaller

and as i say from from a 2025 perspective the only thing that we're

still capitalizing is the iso work stream as that continues out through to

intended finalisation in Q3 2025.

So, short answer, Elaine gives us the outputs from the detailed

granularity, what's summarised under the categorisations that those costs have

been allocated to, and we're capitalising those numbers.

That makes sense. So the quarterly working that you do, that's in respect

that third asset, the ISA work stream?

Yeah, yeah.

OK, so once you undertake that working, who do you pass that on to?

I pass it back to Elaine because she will do the, she'll then kind of put

through the capitalisation back into the project subledger. So then that will.

feed the general ledger with the capitalization entry.

And the finance close team book the monthly, quarterly, whatever

they do, the monetization. I'm not sure whether they post it monthly or

quarterly. But yeah, they post that directly for the first two elements,

are obviously in use.

So yeah, both of those are on the same spreadsheet.

that's that's fine we might need to request that that spreadsheet if that's

that's okay uh yeah yeah okay um and then um sort of after

that is that when it's presented to the gf talk committee or so i i

guess kind of there's no there's no necessary um

kind of requirement for it to go to gf talk right because it's just running a

process. So GF TARC, typically you'd be talking about new transactions or new

judgments, right? So in terms of capitalization, there isn't really a

requirement to go back to GF TARC.

What we have typically gone to GF TARC a couple of times, you know, let's say

kind of probably once a year over the last couple of years, that's largely

to say, look, here's an update on where we are with capitalization.

Here's what we're expecting kind of going forward.

Really, it's tied into kind of saying, OK, we think that we should stop

capitalizing the 105 or we think we should stop capitalizing PPI for these

reasons. So it's really that it's not so much a GFR. Can you approve that we've

capitalized two million this quarter?

And as you can probably appreciate, because we're only left with the ISA

stream. now it's probably not material enough to kind of go to to say that much

to to gf talk um i think we simon you can just tell me what i'm completely

here but um when we talk a little bit about kind of impairment uh which

obviously is an ongoing judgment um we did

include the amounts for capitalization in that paper uh but it wasn't so much

from a

an approval perspective it was it was more from a hey we're capitalizing i

it was yeah forecast six million or something like that yeah exactly it was

saying this is what the balance sheet is going to be and off the back of that

right now the the main paper is talking about kind of um impairment indicators

exactly that's fine

and um i think in terms of the um sort of amortization calculation

process um once those calculations are done sort of who does that go to for

approval well uh when you say well

as i say i've prepared it's part of the same spreadsheet right so and ultimately

there's no in terms of approval there'll be a general preparing a general

approver in in the finance close team

kind of receive that information from us but there's no real judgment in it

because um we're amortizing it until the end of the snarter contract which is

july 20 2033 so it's simply this is what's been capitalized on the balance

this is the remaining period until 2033 and so that amortization at the moment

is so this is 2 .7 million a quarter or 2 .7 million

Yeah, it must be a quarter, I think.

So obviously that figure is not changing and it will only change when we stop

capitalising ISA and start to amortise that.

Yeah,

that's fine.

And in terms of impairment, is that sort of done biannually, if I'm correct?

The review process?

Yeah, I mean, it will align. I mean, typically we're kind of saying that we

have. two windows for going to the audit committee, you know, prior to half year

and prior to year end with accounting judgments.

So we've kind of really aligned it with that.

That really in terms of kind of saying, OK, well, do we think that we need to do

a full impairment calculation or not? Clearly, that's the starting point. Do

have any indicators?

And then.

Typically then, obviously, if there is an indicator, then we would obviously

look to do, potentially look to do a full calc or at least make sure we've

a full calc ahead of the year end if we think that there's a chance that we need

to do it.

But yeah, bi -annually. So just say yes to answer your question in five seconds.

Okay. And have there been any sort of indicators relating to the ISO work

stream?

uh that's certainly not certainly not the ice work stream no and and in

now either um so that's the latest paper right that went to gf chart

i think we've got a pretty good part of the other day didn't it yeah yeah so um

uh we need to i'll check after this call whether we've uploaded those

latest approved papers to wherever we normally upload them and clara but um

Obviously, that's our usual process. We'd obviously kind of get those to you.

Yeah, yeah.

That's OK.

Becky, Marvel, do you have any other questions?

Not for me, no. I think it's a fairly simple process, isn't it?

Well,

simple from my perspective, I'm sure it is.

Yeah, there's obviously judgments involved, but the underlying process

pretty straightforward, right?

Yeah.

Yeah.

Nothing else from me at the minute.

Marvel, anything from yourself?

Nope.

Nope.

So I think on that basis, if we can just sort of request those papers from you.

So we'll send a follow -up email anyways, just requesting that, if that's

Yeah.

Yeah, that's very helpful. And I just want to thank you for your time.

No worries. No worries at all.

All right. Thanks very much.

Thank you.

Bye. Bye.