DECLARATION BY THE PERSON RESPONSIBLE FOR THE INTERIM FINANCIAL REPORT STATUTORY AUDITORS’ REPORT ON THE INTERIM FINANCIAL STATEMENTS MANAGEMENT REPORT HALF-YEAR FINANCIAL STATEMENTS CONDENSED INTERIM CONSOLIDATED Notes to the condensed interim consolidated financial statements 20 AXWAY - 2021 INTERIM FINANCIAL REPORT www.axway.com Accounting principles Note 1 The condensed interim consolidated financial statements for the half-year ended 30 June 2021, together with the accompanying notes, were prepared under the responsibility of the Board of Directors and approved at its meeting of 27 July 2021. Basis of preparation of the condensed 1.1 interim consolidated financial statements The consolidated financial statements for the half-year ended 30 June 2021 were prepared in accordance with IAS 34, Interim Financial Reporting, the IFRS published by the IASB (International Accounting Standards Board) and adopted by the European Union. These standards are available on the European Commission website: http://ec.europa.eu/finance/ company-reporting/ifrs-financial-statements/index_fr.htm. The accounting policies underlying the preparation of the condensed interim consolidated financial statements for the half-year ended 30 June 2021 are identical to those adopted for the consolidated financial statements for the year ended 31 December 2020 and described in Chapter 5, Note 1 of the 2020 Universal Registration Document filed on 18 March 2021 with the French Financial Markets Authority (AMF) under no. D.21-0147 and available on the Company’s website at http://www.investors.axway.com, except for the new standards and interpretations applicable from 1 January 2021 and presented in Note 1.2. These condensed interim consolidated financial statements are presented in thousands of euros, unless indicated otherwise. Application of new standards 1.2 and interpretations The new standards, amendments to existing standards and interpretations adopted by the European Union and of mandatory application in fiscal years beginning on or after 1 January 2021 are as follows: amendments to IAS 39, IFRS 4, IFRS 7, IFRS 9 and IFRS 16, ● Interest rate benchmark reform, phase 2. At this stage, the Group has not identified any material impact of this amendment; IFRIC Interpretation relating to IAS 38, Intangible assets, on ● configuration or customisation costs in a cloud computing arrangement. The impact of this definitive decision was taken into account in the Group’s consolidated financial statements for the half-year ended 30 June 2021 and is not material; IFRIC Interpretation relating to IAS 19, Employee benefits, ● on attributing benefits to periods of service. The Group is conducting an analysis and at this stage it is not possible to estimate whether this decision will have a material impact on the valuation and recognition of its retirement benefit commitments. In addition, the amendment to IFRS 16, COVID-19 related rent concessions, was extended to fiscal year 2021. It is not yet adopted by the European Union. This amendment offers an option to account for COVID-19-related rent concessions as if they were not lease modifications and recognise the impact immediately in profit and loss for the period. The Group did not identify any situations that could give rise to the application of this amendment in the first half of 2021. Impact of the COVID-19 crisis 1.3 on the condensed interim consolidated financial statements In the first half of 2021, the COVID-19 pandemic had a marked impact on travel ● expenses and marketing costs (see Note 6, Purchases and external expenses); the Group did not receive any specific government ● mitigation measures; the COVID-19 crisis did not materially impact customer ● collections. At this stage, the Group has not identified any credit risk. Due to current uncertainties, the Group paid particular attention when performing estimates and judgements for asset impairment purposes. Given its performance during the first half of 2021, past experience with respect to the impacts of the health crisis and the absence of any indication of impairment, the Group considered it unnecessary to perform impairment tests at 30 June 2021 (see Note 12.2, Impairment tests). Key events and scope of consolidation Note 2 Changes in the scope of consolidation Deconsolidated entities a. No entities were deconsolidated in the first six months of 2021. Newly-consolidated entities b. One new entity was included in the scope of consolidation in the first six months of 2021. The Group created a subsidiary in Switzerland, Axway Switzerland Sarl, to distribute Axway technologies and services in Switzerland. This subsidiary was dormant in the first half of 2021.
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