
WEBSTEP | ANNUAL REPORT 2023
exchange rates for the currency exchange rates at the balance
sheet date are recognised directly in other comprehensive
income.
Segment reporting
Operating segments are reported by country of operation,
which currently is Norway and Sweden. The board of Webstep
ASA has appointed a strategic steering committee which
assesses the financial performance and position of the Group
and makes strategic decisions. The steering committee, which
has been identified as being the chief operating decision
maker, consists of the chief executive officer (CEO) and the
chief financial officer (CFO).
Revenues from contracts with customers
The Group is in the business of selling IT-consultancy
manhours to its customers. Revenue for IT- services are to be
recognised over time because the customer simultaneously
receives and consumes the benefits provided by the Group, and
the Group satisfies each
of its performance obligations (that is,
it fulfils its promises to the customer) over time by transferring
control of the promised service underlying that performance
obligation to the customer. The fact that another entity would
not need to re-perform the services that the Group has
provided to date demonstrates that the customer
simultaneously receives and consumes the benefits of the
group’s performance as it performs.
The input method is considered to be the best method when
recognising revenue over time because there is a direct
relationship between the group’s effort (i.e., labour hours
incurred) and the transfer of service to the customer. The
contracts are normally based on service agreements with
hourly fees. Fixed price contracts are recognised as revenue
according to the stage of completion.
Estimated loss on contracts will be recognised in the income
statement in its entirety in the period when it has been
identified.
Contract balances
Contract assets
A contract asset is initially recognised for revenue earned from
billable hours delivered, not yet invoiced the customer. When
the billable hours are invoiced, the invoiced amount is
transferred to trade receivables. Contract assets are subject to
impairment assessment.
Trade receivables
A receivable is recognised if an amount of consideration that is
unconditional is due from the customer.
Contract liabilities
A contract liability is recognised if a payment is received or a
payment is due from the customer before the Group transfers
the related services. Contract liabilities are recognised as
revenue when the Group performs under the contract and
delivers or transfers the services to the customer.
Taxes
The income tax expense or credit for the period is the tax
payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities attributable to
temporary differences and tax losses carried forward.
The current income tax charge is calculated on the basis of the
tax laws enacted or substantively enacted at the end of the
reporting period in Norway and Sweden where the Group
operates and generates taxable income. Management
periodically evaluates positions taken in tax returns with
respect to situations in which applicable tax regulation is
subject to interpretation. It establishes provisions where
appropriate on the basis of amounts expected to be paid to the
tax authorities.
Deferred income tax is provided in full, using the liability
method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the
consolidated fi
nancial statements. However, deferred tax
liabilities are not recognised if they arise from the initial
recognition of goodwill.
Deferred income tax is also not accounted for if it arises from
initial recognition of an asset or liability in a transaction other
than a business combination that at the time of the transaction
affects neither accounting nor taxable pro
fit or loss. Deferred
income tax is determined using tax rates (and tax laws) that
have been enacted or substantially enacted by the end of the
reporting period and are expected to apply when the related
deferred income tax asset is realised or the deferred income
tax liability is settled.
Deferred tax assets are recognised only if it is probable that
future taxable amounts will be available to utilise those
temporary differences and losses.
Business combination and goodwill
Business combinations are accounted for using the acquisition
method. The cost of an acquisition is measured as the
aggregate of the consideration transferred, which is measured
at acquisition date, fair value, and the amount of any
non-controlling interests in the acquiree. For each business
combination, the Group elects whether to measure the
non-controlling interests in the acquiree at fair value or at the
proportionate share of the acquiree’s identi
fiable net assets.
Acquisition-related costs are expensed as incurred and
included in administrative expenses.