AnnuAl RepoRt And Accounts - Mobile Tornado

Notes to the financial statementsFor the year ended 31 December 2011The overdue receivables against which no provision has been made relate to a number ofcustomers for whom there is no recent history of default or any other indication thatsettlement will not be forthcoming.The carrying amounts of the Group’s receivables are denominated in US dollar and Euros.The maximum exposure to credit risk at the reporting date is the carrying value of each classof receivable mentioned above. The Group does not hold any collateral as security.There is no movement on the Group’s provision for impairment of trade receivables.10 Trade and other payables2011 2010£’000 £’000Trade payables 1,561 582Accruals 1,398 1,029Social security and other taxes 21 118Other creditors 140 124Deferred income 2,267 2,266Deferred consideration 3,074 3,1468,461 7,265Less non-current portion: deferred consideration (2,923) (2,754)Current portion 5,538 4,511The deferred consideration arose on the purchase of intellectual property from Tersync Ltd andrepresents a royalty payable on future sales of Push to Talk related products by MobileTornado, payable in part consideration for the acquisition of the rights to the technologyunderlying such product. The royalty is payable quarterly on any relevant sales (on a cashreceipts basis) as follows:(i)(ii)50% of the first US$200,000 relevant sales.15% of any additional relevant sales, subject to any related cumulative royalty paymentsbeing capped at a maximum of US$5.3 million. Direct reseller and other third party costsmay be deducted in arriving at these royalty payments, subject to such costs notexceeding 10% of the relevant sales. The deferred consideration is secured by a chargeover the intellectual property of the Mobile Tornado Group.The deferred income balance includes an amount of £1,980,000 (2010: £2,115,000) receivedfrom InTechnology plc in respect of 12 month licenses that had not been brought into use atthe balance sheet date.11 Borrowings, other financial liabilities and other financial assets2011 2010£’000 £’000Preference shares 610 3,000Loans 1,515 865Total borrowings 2,125 3,865Page 26