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Registered number: 08319044
SAGE TREASURY COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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SAGE TREASURY COMPANY LIMITED
CONTENTS
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Statement of Directors' Responsibilities in respect of the Annual Report and
Financial Statements for the year ended 30 September 2025
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Independent Auditor's Report to the Members of Sage Treasury Company Limited
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Statement of Comprehensive Income
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Statement of Changes in Equity
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Notes to the Financial Statements
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SAGE TREASURY COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2025
The Directors of Sage Treasury Company Limited (the “Directors”) present their Strategic Report on Sage Treasury Company Limited ("the Company") for the year ended 30 September 2025. The Directors of The Sage Group plc., the ultimate parent company, set the strategy for the whole Sage group of companies (“Sage", or the "Group"). This is set out within The Sage Group plc. Annual Report and Accounts for the year ended 30 September 2025 (the “Plc Annual Report and Accounts”), which does not form part of this report.
The Company continued to perform its role as the Group’s internal treasury and financing vehicle. During the year, the Company generated profit after tax of £7,486,000 (2024: £30,096,000). This movement primarily reflects changes in intercompany funding levels, interest margins and foreign-exchange-related items arising from normal treasury operations.
Principal risks and uncertainties
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The Global Risk Management Framework has been built to identify, evaluate, analyse, manage and mitigate those risks which threaten the successful achievement of our business strategy and objectives, within tolerable appetites. Risks are owned and managed at a Global level and are formally reviewed on a quarterly basis.
Risk is inherent within our business activities, and the Group as a whole continues to prioritise and develop its risk management capability in recognition of this. Timely identification of risks, combined with their appropriate management and escalation, enables the Group to successfully run each business and deliver strategic change, whilst ensuring that the likelihood and/or impact associated with such risks is understood and managed within our defined risk appetite.
Currently there are ten principal risks which are monitored and reported against at a Global level.
• Customer Experience
• Execution of Product Strategy
• Developing and Exploiting New Business Models
• Route to Market
• People and Performance
• Culture
• Cyber Security
• Data and AI Governance
• Readiness to Scale
• Environmental, Social & Governance
The detail on the background, management and mitigation process can be seen in detail in the Plc Annual Report and Accounts.
Financial risk management
The Company is exposed to financial risks arising from its treasury activities with other Sage Group companies. These risks are managed in accordance with the Group Treasury Policy but are limited in scale due to the Company’s role as an internal financing vehicle.
Credit risk
The Company’s credit risk arises from intercompany receivables and cash held with external banks.
- Intercompany receivables are due from fellow Group undertakings and therefore present low credit risk.
- Cash deposits are only placed with banks that meet minimum credit rating requirements under the Group Treasury Policy.
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SAGE TREASURY COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2025
The carrying amounts of receivables and cash represent the maximum exposure to credit risk.
Interest rate risk
Interest rate risk arises on intercompany loan arrangements and cash balances.
- Intercompany interest rates are set centrally by Group Treasury.
- The Company has no external borrowings and uses derivative financial instruments to hedge its own and the Group's exposure to interest rate risk.
As a result, the Company’s interest rate risk exposure is considered limited.
Foreign currency risk
Foreign currency risk arises from intercompany balances and transactions denominated in currencies other than sterling.
- Exposures are monitored and managed by Group Treasury.
- The Company does not hold external foreign currency borrowings.
- The company applies hedge accounting to limit its own and the Group's exposure to foreign exchange risks.
Residual gains or losses are recognised in the income statement as they arise.
Key performance indicators
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The Directors of The Sage Group plc manage and measure the Group's operations on a regional and segmental basis. For this reason, the Company's Directors believe that analysis using key performance indicators for the Company is not necessary or appropriate for an understanding of the development, performance or position of the Company’s business. The key performance indicators used by the directors of The Sage Group plc to manage and measure the performance of the Group are discussed within the Plc Annual Report and Accounts.
It is the intention of the Directors that the Company will continue to act as a treasury and financing company for the foreseeable future.
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SAGE TREASURY COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2025
As required under Section 172(1) of the Companies Act 2006 (“Section 172 (1)”), the Directors of the Company have acted in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole. In doing so, they have had regard to the matters set out in Section 172(1) (a) to (f), which include:
- the likely consequences of decisions in the long term;
- the interests of the Company’s employees;
- fostering business relationships with customers, suppliers and others; the impact on society and the environment;
- maintaining high standards of conduct; and
- acting fairly between members of the Company.
The principal activity of the Company is that of a finance company. The Company did not have external trade during the FY25 financial year and, therefore, its activities were limited to the Company’s activities as a finance company.
The Company is a wholly owned subsidiary of The Sage Group plc. As is typical for a company which is part of a large, listed, group, day-to-day decision making is delegated to Sage’s management. Sage’s management engage with the Company’s immediate shareholder and other Group undertakings through Sage management activities and meetings. Decisions made by the Directors are guided by Sage Group’s governance framework, values, Code of Conduct and robust standard of business conduct and ethics. The Directors recognise that the Company’s stakeholders are largely consistent with those set out in The Sage Group plc.’s Annual Report and Accounts. They also recognise that whilst the Company itself does not have any employees or customers, that Sage colleagues and customers are crucial to Sage’s success and engagement is maintained at Group level.
The Directors also recognise that the Group is committed to managing the Group's use of resources proactively to minimise environmental impact and investing in education, technology, and environmental change to protect the planet and give individuals and small and mid-sized businesses, the opportunity to thrive. The Directors of the Company also support Sage's culture and commitment to doing business the right way, demonstrated through Sage Foundation, which encourages colleague engagement with charitable giving and philanthropic support for non-profit organisations and communities.
The Directors are kept informed of stakeholder priorities through regular engagement with Sage management and reporting mechanisms, and factor the wider interests of the Group into decision making when relevant.
The Company makes autonomous decisions through Board meetings which are convened, as required, to consider those matters which impact the Company. The Director’s consider relevant Section 172(1) factors to ensure stakeholders interests are balanced and that decisions are made in the context of long-term sustainable success of the Company.
This report was approved by the board and signed on its behalf.
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SAGE TREASURY COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2025
The Directors present their report and the audited financial statements for the year ended 30 September 2025.
The principal activity of Sage Treasury Company Limited (the “Company”) throughout the year has been that of a finance company and will remain as such for the foreseeable future.
The profit for the year, after taxation, amounted to £7,486,000 (2024: £30,096,000).
No dividends were declared and paid during the year (2024: nil).
The Directors who served during the year and to the date of this report were:
Victoria Louise Bradin (resigned 23 January 2026)
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Jacqui Cartin (resigned 18 November 2025)
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Alexander Hall
Sarah Browne (appointed 23 January 2026)
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The ultimate parent company, The Sage Group plc. ("Sage" or the "Group"), maintained liability insurance for its Directors and officers during the financial year and up to the date of approval of these financial statements. The Sage Group plc. has also provided an indemnity for its Directors and the company secretary, which is a qualifying third-party indemnity provision for the purposes of the Companies Act 2006.
The Company and Sage continue to give full and fair consideration to applications for employment made by disabled persons, having regard to their respective aptitudes and abilities. This includes, where practicable, the continued employment of those who may become disabled during their employment, and the provision of training and career development and promotion opportunities, where appropriate. For further information please refer to the Plc Annual Report and Accounts available on Sage’s website at sage.com.
Engagement with colleagues
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Sage has continued its policy of colleague involvement by making information available and consulting, where appropriate, with colleagues on matters of concern to them. Colleagues regularly receive updates on the financial and economic factors affecting the Group, and conversely the Group regularly seeks feedback from colleagues, including through pulse surveys. Many colleagues participate in Sage’s share option schemes and a long-term Performance Share Plan. Further details of colleague engagement and how the Directors have had regard to employee interests and the effect of that regard on principal decisions taken during the year ended 30 September 2025 are provided on page 3 of the Strategic Report of the Company as the Directors consider them to be of strategic importance.
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SAGE TREASURY COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2025
Engagement with suppliers, customers and others
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Details of engagement with stakeholders including suppliers, customers and others in a business relationship with Sage and information on how the Directors have had regard to their interests and the effect of that regard on principal decisions taken during FY25 are provided on page 3 of the Strategic Report of the Company as the Directors consider them to be of strategic importance.
Greenhouse gas emissions, energy consumption and energy efficiency action
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The Company is exempt from providing the information required by Schedule 7A to the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (SI 2008/410) in respect of greenhouse gas emissions, energy consumption and action taken to increase its energy efficiency in the UK, as the Company is included in the annual report and accounts of The Sage Group plc. for the year ended 30 September 2025 which include the required disclosures.
For further information on future developments and financial risk management please refer to the strategic report.
The directors have prepared the financial statements on the going concern basis as they have concluded that the company's financial position means that this is realistic. In making their assessment, the directors considered that the intercompany balances primarily relate to a back-to-back funding vehicle.
The Directors have robustly tested the going concern assumption in preparing the financial statements ensuring that the Company can continue to pay its liabilities as they fall due through a forecasted period of 12 months from the date of the approval of the financial statements (“the going concern assessment period”).
This included reviewing the Company’s cash position, net asset position and obligations under debt arrangements with other Sage Group companies.
Disclosure of information to auditor
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Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that:
∙so far as the Director is aware, there is no relevant audit information of which the Company's auditor is unaware, and
∙the Director has taken all the steps that ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.
Post balance sheet events
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There have been no significant subsequent events identified at the date of this report which would impact the Company.
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SAGE TREASURY COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2025
The external auditor of the company for the prior financial year was Ernst and Young. As a result of an audit tender undertaken by the Company's ultimate parent Company, The Sage Group plc, KPMG LLP were appointed by the Company as auditors for the year ended 30 September 2025.
Pursuant to Section 487 of the Companies Act 2006, the auditor will be deemed to be re-appointed, and KPMG LLP will therefore continue in office.
This report was approved by the Board and signed on its behalf.
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C23 - 5 & 6 Cobalt Park Way Cobalt Park
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SAGE TREASURY COMPANY LIMITED
STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT AND
FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 SEPTEMBER 2025
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the Directors are required to:
∙select suitable accounting policies and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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SAGE TREASURY COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SAGE TREASURY COMPANY LIMITED
Opinion
We have audited the financial statements of Sage Treasury Company Limited (“the Company”) for the year ended 30 September 2025 which comprise the Statement of Comprehensive Income, the Balance Sheet and the Statement of Changes in Equity and related notes, including the accounting policies in note 2.
In our opinion, the financial statements:
- give a true and fair view of the Company’s affairs as at 30 September 2025 and of its profit for the year then ended;
- have been properly prepared in accordance with UK accounting standards, including FRS 101 Reduced Disclosure Framework; and
- have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are described below. We have fulfilled our ethical responsibilities under, and are independent of the Company in accordance with, UK ethical requirements including the FRC Ethical Standard.
We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.
Going concern
The directors have prepared the financial statements on the going concern basis as they do not intend to liquidate the Company or to cease its operations, and as they have concluded that the Company’s financial position means that this is realistic. They have also concluded that there are no material uncertainties that could have cast significant doubt over its ability to continue as a going concern for at least a year from the date of approval of the financial statements (“the going concern period”).
In our evaluation of the directors’ conclusions, we considered the inherent risks to the Company’s business model and analysed how those risks might affect the Company’s financial resources or ability to continue operations over the going concern period.
Our conclusions based on this work:
• we consider that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate;
• we have not identified, and concur with the directors’ assessment that there is not, a material uncertainty related to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for the going concern period.
However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee that the Company will continue in operation.
Fraud and breaches of laws and regulations – ability to detect
Identifying and responding to risks of material misstatement due to fraud.
To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:
• Enquiring of directors, internal audit and inspection of policy documentation as to the Company’s high-level
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SAGE TREASURY COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SAGE TREASURY COMPANY LIMITED
Fraud and breaches of laws and regulations – ability to detect (continued)
policies and procedures to prevent and detect fraud including the internal audit function, and the Company’s channel for whistleblowing, as well as whether they have knowledge of any actual, suspected or alleged fraud.
• Reading Board minutes.
• Using analytical procedures to identify any unusual or unexpected relationships.
We communicated identified fraud risks throughout the audit team and remained alert to any indications of fraud throughout the audit.
As required by auditing standards, we perform procedures to address the risk of management override of controls, in particular the risk that management may be in a position to make inappropriate accounting entries. On this audit we do not believe there is a fraud risk related to revenue recognition because the Company does not have any revenue.
We did not identify any additional fraud risks.
We also performed procedures including:
• Identifying journal entries and other adjustments to test based on risk criteria and comparing the identified entries to supporting documentation. These included those posted to unusual combination of cash.
• Assessing whether the judgements made in making accounting estimates are indicative of a potential bias.
Identifying and responding to risks of material misstatement related to compliance with laws and regulations
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience and through discussion with the directors and others in management and discussed with the directors and others in management (as required by auditing standards), and discussed the policies and procedures regarding compliance with laws and regulations.
We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.
The potential effect of these laws and regulations on the financial statements varies considerably.
Firstly, the Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related-companies legislation), distributable profits legislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
Secondly, the Company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect: data protection laws, and anti-bribery recognising the nature of the Company’s activities. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach.
Context of the ability of the audit to detect fraud or breaches of law or regulation
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently
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SAGE TREASURY COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SAGE TREASURY COMPANY LIMITED
limited procedures required by auditing standards would identify it.
Fraud and breaches of laws and regulations – ability to detect (continued)
In addition, as with any audit, there remained a higher risk of non-detection of fraud, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.
Strategic report and directors’ report
The directors are responsible for the strategic report and the directors’ report. Our opinion on the financial statements does not cover those reports and we do not express an audit opinion thereon.
Our responsibility is to read the strategic report and the directors’ report and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work:
- we have not identified material misstatements in the strategic report and the directors’ report;
- in our opinion the information given in those reports for the financial year is consistent with the financial statements; and
- in our opinion those reports have been prepared in accordance with the Companies Act 2006.
Matters on which we are required to report by exception
Under the Companies Act 2006 we are required to report to you if, in our opinion:
• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
• the financial statements are not in agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
We have nothing to report in these respects.
Directors’ responsibilities
As explained more fully in their statement set out on page 7 the directors are responsible for: the preparation of the financial statements and for being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and using the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.
A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/auditorsresponsibilities.
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SAGE TREASURY COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SAGE TREASURY COMPANY LIMITED
The purpose of our audit work and to whom we owe our responsibilities
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members, as a body, for our audit work, for this report, or for the opinions we have formed.
Luke Baker (Senior statutory auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
15 Canada Square
London
United Kingdom
E14 5GL
23 January 2026
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SAGE TREASURY COMPANY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Income from participating interests
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Profit for the financial year
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Total comprehensive income for the year
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The notes on pages 16 to 29 form part of these financial statements.
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Page 12
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SAGE TREASURY COMPANY LIMITED
REGISTERED NUMBER: 08319044
BALANCE SHEET
AS AT 30 SEPTEMBER 2025
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Trade and other receivables
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Trade and other receivables
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Cash and cash equivalents
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Page 13
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SAGE TREASURY COMPANY LIMITED
REGISTERED NUMBER: 08319044
BALANCE SHEET (CONTINUED)
AS AT 30 SEPTEMBER 2025
Equity attributable to the owners of the parent
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Cash flow hedging reserve
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The comparative balance sheet at 30 September 2024 has been restated as discussed within the ‘Basis of preparation’ (see note 2.1).
The financial statements were approved and authorised for issue by the Board and were signed on its behalf on 23 January 2026.
The notes on pages 16 to 29 form part of these financial statements.
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SAGE TREASURY COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Cash flow hedging reserve
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Movement in interest differential for Market to Market hedging instrument
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Total comprehensive income for the year
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Adjustment on initial application of IFRS9 hedge accounting
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At 1 October 2024 (adjusted)
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Movement in interest differential for Market to Market hedging instrument
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Changes in fair value of foreign currency basis of hedge relationships
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Total comprehensive income for the year
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The notes on pages 16 to 29 form part of these financial statements.
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Page 15
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
Sage Treasury Company Limited (the “Company”) is a company incorporated and domiciled in England, it is a private company limited by shares and the Company’s registered address is C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, United Kingdom, NE28 9EJ.
2.Accounting policies
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Basis of preparation of financial statements
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The Company is exempt by virtue of s400 of the Companies Act 2006 from the requirement to prepare group financial statements. These financial statements present information about the Company as an individual undertaking and not about its group.
These financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (“FRS 101”) and the UK Companies Act 2006.
In preparing these financial statements, the Company applies the recognition, measurement and disclosure requirements of International Financial Reporting Standards as adopted by the UK (“Adopted IFRSs”) but makes amendments where necessary in order to comply with Companies Act 2006 and has set out below where advantage of the FRS 101 disclosure exemptions has been taken.
The Company’s ultimate parent undertaking, The Sage Group plc., includes the Company in its consolidated financial statements. The consolidated financial statements of The Sage Group plc. are prepared in accordance with International Financial Reporting Standards and are available to the public and may be obtained from the address given in note 17.
The Company proposes to continue to adopt the reduced disclosure framework of FRS 101 in its next financial statements.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements.
Judgements made by the Directors, in the application of these accounting policies that have a significant effect on the financial statements and estimates with a significant risk of material adjustment in the next year are discussed in note 3.
The financial statements are prepared on a going concern basis and under the historical cost convention, as modified by derivative financial assets and financial liabilities measured at fair value and in accordance with the Companies Act 2006. All amounts are presented in Great British Pounds (GBP) and are round to the nearest £’000.
The directors have prepared the financial statements on the going concern basis as they have concluded that the company's financial position means that this is realistic. In making their assessment, the directors considered that the intercompany balances primarily relate to a back-to-back funding vehicle.
The Directors have robustly tested the going concern assumption in preparing the financial statements ensuring that the Company can continue to pay its liabilities as they fall due through a forecasted period of 12 months from the date of the approval of the financial statements (“the going concern assessment period”).
This included reviewing the Company’s cash position, net asset position and obligations under debt arrangements with other Sage Group companies.
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
2.Accounting policies (continued)
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Basis of preparation of financial statements (continued)
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The directors have restated the comparative balance sheet for the year ended 30 September 2024 by way of a prior year adjustment in accordance with the requirements of FRS 101 IAS 8 paragraph 42.
Intercompany loan receivables were classified as current assets due to their nature as being repayable on demand, rather than management’s expectation as to whether the asset would be realised in its normal operating cycle (IAS 1 para 66). This resulted in the overstatement of current assets in the prior year by £1,457,729,000. The restatement resulted in a decrease of current assets by £1,457,729,000 and increase in non-current assets by £1,457,729,000.
The principal accounting policies, which have been applied consistently throughout the year, are set out below.
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Financial Reporting Standard 101 - reduced disclosure exemptions
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In these financial statements, the Company, as a qualifying entity under FRS 101, has applied the exemptions available under the standard in respect of the following disclosures:
• A Cash Flow Statement and related notes, as required by IAS 7 Statement of cash flows;
• Disclosures in respect of transactions with wholly owned subsidiaries, as required by IAS 24 Related party disclosures;
• Disclosures in respect of capital management, as required by paragraphs 134 to 136 of IAS 1 Presentation of financial statements;
• The effects of new but not yet effective IFRSs, as required by paragraphs 30 and 31 of IAS 8 Accounting policies, changes in accounting estimates and errors;
• Disclosures in respect of the compensation of Key Management Personnel, as required by paragraph 17 of IAS 24 Related party disclosures;
As the consolidated financial statements of The Sage Group plc. include the equivalent disclosures, the Company has also taken the exemptions under FRS 101 available in respect of the following disclosures:
• Certain disclosures required by paragraphs 91 to 99 of IFRS 13 Fair Value Measurement and the disclosures required by IFRS 7 Financial Instrument Disclosures.
Monetary assets and liabilities expressed in foreign currencies are translated into sterling at rates of exchange prevailing at the balance sheet date. Transactions in foreign currencies are converted into sterling at the rate prevailing at the dates of the transactions. All differences on exchange are taken to the income statement.
Finance income is recognised in the income statement using the effective interest method.
Page 17
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
2.Accounting policies (continued)
Finance costs are charged to income statement over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
The taxation expense for the year represents the sum of current tax payable and deferred tax. The expense is recognised in the income statement and statement of comprehensive income according to the accounting treatment of the related transaction.
Current tax payable or receivable is based on the taxable income for the period and any adjustment in respect of prior periods. Current tax is measured at the amount expected to be recovered from or paid to the taxation authorities, calculated using tax rates that have been enacted at the end of the reporting period.
The Company and its fellow group undertakings are able to relieve their tax losses by surrendering them to other group companies, within the UK corporation tax group, where capacity to utilise these losses exists.
Investments are stated at cost less provision for any diminution in value. Any impairment is charged to the profit and loss account as it arises.
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Trade and other receivables
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Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.
The carrying amounts of trade receivables are reduced by allowances for expected credit losses using the simplified approach under IFRS 9. The Company uses a matrix approach to determine the allowance. The default rates applied are based on the ageing of the receivable, past experience of credit losses and forward looking information. An allowance for a receivable’s estimated lifetime expected credit losses is first recorded when the receivable is initially recognised, and subsequently adjusted to reflect changes in credit risk until the balance is collected. In the event that management considers that a receivable cannot be collected, the balance is written off.
Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
Page 18
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
2.Accounting policies (continued)
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Provisions for liabilities
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Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Increases in provisions are generally charged as an expense to profit or loss.
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Cash and cash equivalents
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Cash and cash equivalents include cash at bank and in hand and short-term deposits with an original maturity period of three months or less. Bank overdrafts that are an integral part of the Company’s cash management are included in cash and cash equivalents where they have a legal right of set-off and there is an intention to settle net, against positive cash balances, otherwise bank overdrafts are classified as borrowings.
Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost with any difference between cost and redemption value being recognised in the income statement over the period of borrowing on an effective interest basis.
All borrowing costs are recognised in the income statement in year in which they are incurred.
Financial assets and financial liabilities are recognised in the Company’s balance sheet when the Company becomes a party to the contractual provisions of the instrument.
Financial assets are derecognised (i.e., removed from the Company’s balance sheet) when the rights to receive cash flows from the asset have expired; or when the Company has transferred those rights and either has also transferred substantially all the risks and rewards of the asset or has neither transferred nor retained substantially all the risks and rewards of the asset but no longer has control of the asset.
Financial liabilities are derecognised when the obligation specified in the contract is discharged, cancelled or expire.
Financial assets and financial liabilities are initially measured at fair value.
All recognised financial assets are subsequently measured in their entirety at either fair value or amortised cost, depending on the classification of the financial assets.
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Derivative financial instruments and hedge accounting
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The Company uses derivative financial instruments to hedge its own and the Group’s exposure to foreign exchange and interest rate risks arising from operating, financing and investing activities. The Company does not hold or issue derivative financial instruments for trading purposes; however,
Page 19
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
2.Accounting policies (continued)
if derivatives do not qualify for hedge accounting they are accounted for as fair value through profit and loss (FVTPL).
Derivative financial instruments are recognised and stated at fair value. Where derivatives do not qualify for hedge accounting, any gains or losses on re-measurement are immediately recognised in the Statement of Comprehensive Income. Where derivatives qualify for hedge accounting, recognition of any resultant gain or loss depends on the nature of the hedge relationship and the items being hedged.
In order to qualify for hedge accounting, the Company is required to document from inception, the relationship between the item being hedged and the hedging instrument. The Company is also required to document and demonstrate an assessment of the relationship between the hedged item and the hedging instrument, which shows that the hedge will be highly effective on an on-going basis. This effectiveness testing is performed at each reporting date to ensure that the hedge remains highly effective.
Derivative financial instruments with maturity dates of more than one year from the balance sheet date are disclosed as non-current.
Impact of application of hedging requirements of IFRS 9 Financial Instruments
As at 1 October 2024, the Company elected to apply the hedge accounting requirements in IFRS 9 Financial Instruments instead of those in IAS 39 Financial Instruments: Recognition and Measurement. This standard introduces simplified hedge accounting through closer alignment with the entity’s risk management methodology.
All existing hedge relationships were regarded as continuing hedge relationships. All such designated hedge relationships under IAS 39 as at 30 September 2025 met the criteria for hedge accounting under IFRS 9 as the Company’s risk management strategies and hedge documentation were aligned to the new standard.
The Company has adopted the modified transition approach and therefore adjusted opening cash flow hedging reserve balances for the impact of adopting IFRS 9 hedge accounting and has not restated prior period comparatives.
Under IAS 39 the Company included the cost of hedging within the hedge relationship. On transition, IFRS 9 allows the choice to separate aspects of the cost of hedging from the designation within a hedge relationship as part of the hedging instrument. Under IFRS 9, in relation to the cross-currency interest rate swaps that are designated in a cash flow hedge relationship, the Company has separated the costs relating to currency basis from the hedge relationship and therefore allocates this component within a newly recognised cost of hedging reserve.
On transition to IFRS 9, an equity classification adjustment was recognised for which £1m was credited to the cash flow hedging reserve, offset by £1m debited to the cost of hedging reserve.
Other than the changes above, there are no additional accounting differences applied as a result of the adoption of IFRS 9 hedge accounting requirements when compared to the previous accounting policies under IAS 39.
The impact on the year ended 30 September 2025 is not material and the transition did not result in any changes in the measurement or classification of financial instruments as at 1 October 2024.
Page 20
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
2.Accounting policies (continued)
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.
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Judgements in applying accounting policies and key sources of estimation uncertainty
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The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amount of the assets and liabilities within the next year.
Recoverability of investments
Determining whether investments are impaired requires an estimate of the value-in-use or assessment of the assets and liabilities in the investment group. Where an estimate of the value-in-use is used, the key assumptions applied in the calculation relate to the future performance expectations of the business – average medium-term revenue growth, long term operating margin and long-term growth rate – as well as the discount rate to be applied in the calculation.
The carrying value of investments at 30 September 2025 was £1,556,298,000 (2024: £1,583,514,000) and an impairment loss of £nil has been recognised in the year (2024: £nil).
Recoverability of amounts owed by group undertakings
Determining whether amounts owed by group undertakings are recoverable requires a determination of whether the other party is able to repay. This is performed by assessing the assets and liabilities of the other party.
The carrying value of amounts owed by group undertakings at 30 September 2025 was £2,450,965,000 (Restated 2024: £2,328,349,000) and an impairment loss of £nil has been recognised (2024: £nil).
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Income from participating interests
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Income from participating interests relates to the Company’s share of profits from its limited partnership interest in Sage US LLP.
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Auditor's remuneration is borne by the ultimate parent company, The Sage Group plc, in both the current and prior year. The audit fees payable in relation to the audit of the financial statements of the Company are £57,000 (2024: £59,000).
The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the group accounts of its parent The Sage Group plc.
The Directors did not receive any emoluments during the year in respect of their services to the Company (2024: nil). No other persons were employed during the year (2024: none).
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Page 21
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Interest receivable from group companies
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Net gains on derivative arrangements
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Net foreign exchange gains
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Finance costs on bank borrowings
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Amortisation of issue costs
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Interest on internal swaps
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Net foreign exchange losses
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Interest payable to group undertakings
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Fair value movements on internal swaps
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Page 22
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Current tax on profits for the year
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Factors affecting tax charge for the year
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The tax assessed for the year is lower than (2024 - lower than) the standard rate of corporation tax in the UK of 25% (2024 - 25%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%)
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Non-deductible tax expenses and permanent items
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Group relief claimed for no payment
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Total tax credit for the year
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There were no factors that may affect future tax charges.
Page 23
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Disposals in the year relates to a return of capital from Sage US LLP of $34m.
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Page 24
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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The following were subsidiary undertakings of the Company:
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C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, NE28 9EJ
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C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, NE28 9EJ
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C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, NE28 9EJ
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C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, NE28 9EJ
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C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, NE28 9EJ
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Sage Treasury Ireland Unlimited Company *
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Number One Central Park, Leopardstown, Dublin 18
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* Direct subsidiary
^ The investment is that of a limited partnership in which the Company only has rights to the share in profit
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Deferred tax assets and liabilities
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Credited to income statement
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Page 25
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
10.Deferred tax assets and liabilities (continued)
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The deferred tax asset is made up as follows:
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Trade and other receivables
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Due after more than one year
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Amounts owed by group undertakings
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Amounts owed by group undertakings
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Prepayments and accrued income
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Page 26
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
11.Trade and other receivables (continued)
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Other debtors due within one year relates to the loan issue costs to be amortised £1,181,000 and £10,202,000 EU State Aid.
Amounts owed by Group undertakings current are unsecured and attract a rate of between 0% and 14.25% (including undrawn facilities), and are repayable on demand (2024: between 0% and 14.25%).
Amounts owed by Group undertakings non-current are unsecured and attract a rate of between 0% and 14.25% (including undrawn facilities), and are repayable on demand, 15 February 2028 and 25 February 2031 (2024: between 0% and 14.50%). Whilst the amount is repayable on demand, no expectation exists that the balance will be recovered within twelve months of the period end date and as such has been classified as non-current.
During the year, the Group reviewed the presentation of certain balances within the Statement of Financial Position. As part of this review, the balances of derivatives were reclassed to Financial Instruments. These balances had previously been included within Trade and other receivables due after more than one year. This change relates to presentation only and has no impact on net assets and income statement.
The comparative amounts owed by group undertakings at 30 September 2024 have been restated as discussed within the ‘Basis of preparation’ (see note 2.1).
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Amounts owed to Group undertakings current are unsecured and attract a rate of between 0% and 8.53%, including undrawn facilities (2024: between 0% and 9.16%).
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Page 27
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Trade and other payables due after more than one year
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Amounts owed to group undertakings
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Amounts falling due in more than one year are repayable on 15 February 2028 and attract a rate of 3.82% and SONIA +1.6% for September 2025. (2024: 3.82% and SONIA +1.6%).
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Charged to profit or loss
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The tax provision of £806,000 relates to interest charges expected to be payable on the uncertain tax provision of £10,766,000 shown in other payables. This uncertain tax provision is in respect of financing arrangements which were in place in prior years.
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Page 28
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SAGE TREASURY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2025
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Allotted, called up and fully paid
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5,000,001 (2024 - 5,000,001) Ordinary shares of £1.00 each
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Retained earnings represent cumulative comprehensive income less dividends paid.
The cash flow hedging reserve represents the cumulative effective portion of gains and losses on derivative financial instruments that are designated and qualify as cash flow hedges.
The cost of hedging reserve represents the cumulative fair value changes in the time value of options, the forward element of forward contracts, and the foreign currency basis spread of financial instruments designated as hedging instruments under IFRS 9.
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As the consolidated financial statements of The Sage Group plc. include the equivalent disclosures, the Company has taken the exemptions under FRS 101 available in respect of certain disclosures required by IFRS 13 Fair Value Measurement and the disclosures required by IFRS 7 Financial Instrument Disclosures. The disclosures below cover statutory balances in relation to amounts owed by / to group undertakings that are not covered in The Sage Group plc. consolidated financial statements.
Fair value measurement of financial assets and financial liabilities
Amounts owed by group undertakings and amounts owed to group undertakings are initially measured at fair value and are subsequently measured at amortised cost. The Directors of the Company consider that the carrying amounts of the financial assets and financial liabilities recognised in the financial statements approximate their fair values.
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Immediate and ultimate parent Company
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The immediate and ultimate parent undertaking, and ultimate controlling party is The Sage Group plc. a company registered in England and Wales. The Sage Group plc. is the largest and smallest group to consolidate these financial statements. Copies of the group financial statements can be obtained from the registered office at The Sage Group plc., C23 - 5 & 6 Cobalt Park Way, Cobalt Park, Newcastle upon Tyne, NE28 9EJ, United Kingdom.
Page 29
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