AXWAY_REGISTRATION_DOCUMENT_2017

AXWAY GROUP AND ITS BUSINESS ACTIVITIES

CORPORATE RESPONSIBILITY

CORPORATE GOVERNANCE

CONSOLIDATED FINANCIAL STATEMENTS

2017 ANNUAL FINANCIAL STATEMENTS

CAPITAL AND AXWAY SOFTWARE STOCK

INFORMATIONS ADMINISTRATIVES ETbJURIDIQUES

COMBINED GENERAL MEETING OFb6bJUNEb2018

Notes to the financial statements

● Axway Software Group does not, directly or indirectly, control any ad hoc company. ● Transactions between entities included in the scope of consolidation, as well as unrealized balances and profits on transactions between Group companies are eliminated. ● The financial statements of all consolidated companies are prepared as of 31ǾDecember. These accounts have, where applicable, been restated to ensure the consistency of accounting and valuation rules applied by the Group. ● The list of consolidated companies is given in NoteǾ16. 2.2 Foreign currency translation a. Functional and presentation currencies Items included in the financial statements of each entity included in the scope of consolidation are measured using the currency of the primary economic environment in which each entity operates, i.e. its “functional currency”. The consolidated financial statements are presented in euros, the functional and presentation currency of the parent company Axway Software. b. Translation of the financial statements of foreign subsidiaries Group subsidiaries’ functional currencies are their local currencies in which most of their transactions are denominated. The accounts of all entities included in the scope of consolidation whose functional currency differs from the Group’s presentation currency are translated into euros as follows: ● assets and liabilities are translated at year-end exchange rates;

● income, expenses and cash flows are translated at average rates for the period; ● all resulting foreign exchange differences are recognized as a distinct shareholders’ equity component under “Foreign exchange gains and losses”. Foreign exchange differences arising from the translation of net investments in foreign operations are recorded as a separate component of equity under the heading Translation reserves in accordance with IASǾ21. Foreign exchange differences relating to intercompany loans are considered as an integral part of the Group’s net investment in the foreign subsidiaries in question. When a foreign operation is divested, the applicable accumulated translation difference is transferred to the income statement as part of the gain or loss arising on disposal. Goodwill and fair value adjustments arising on acquisition of foreign operations are treated as assets and liabilities of the operation and, as such, are translated at the closing rates applying at the balance sheet date. No entity operating in a hyper-inflationary economy is included in the scope of consolidation. c. Translation of foreign currency transactions Transactions denominated in foreign currencies are translated to entities’ functional currencies at rates applying on the transaction dates. The foreign exchange gains and losses arising on settlement, as well as those arising from the adjustment of foreign currency denominated monetary assets and liabilities to rates applied at the balance sheet date, are recognized in profit or loss with the exception of amounts recognized directly in shareholders’ equity with respect to cash flow hedging or hedging of the net investment in a foreign operation.

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d. Conversion rate

Average rate for the period

Period-end rate

2017

2016

2015

2017

2016

2015

€1/currency Swiss franc

1.1102 0.8757 9.6349 4.5683 1.9558 1.1270 1.4713 8.7814 1.5571 7.6206 73.4077 3.5931 4.8473

1.0901 0.8166 9.4633 4.4906 1.9558 1.1062 1.4875 8.5865 1.5276 7.3483 74.3344 3.8378 4.5824

1.0676 0.7260 9.3545 4.4452 1.9558 1.1096 1.4765 8.6023 1.5251 6.9730 71.1752 3.6916 4.3315

1.1702 0.8872 9.8435 4.6585 1.9558 1.1993 1.5346 9.3721 1.6024 7.8046 76.6284 3.9728 4.8537

1.0739 0.8562 9.5529 4.5391 1.9558 1.0541 1.4596 8.1753 1.5234 7.3201 71.5820 3.4305 4.7288

1.0835 0.7340 9.1895 4.5240 1.9558 1.0887 1.4897 8.4376 1.5417 7.0608 72.0215 4.3117 4.6959

Pound sterling Swedish krona Romanian leu Bulgarian lev Australian dollar Hong Kong dollar Singapore dollar US dollar

Yuan (China) Rupee (India) Real (Brazil)

Ringgit (Malaysia)

The conversion rate adopted at the date of Syncplicity’s acquisition is EURb1 equals USDb1.0533.

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AXWAY - 2017 REGISTRATION DOCUMENT