Committed Capital Financial Services Ltd - Limited company accounts 18.2

REGISTERED NUMBER: 03810820 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30TH JUNE 2018

FOR

COMMITTED CAPITAL FINANCIAL

SERVICES LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Statement of Comprehensive Income

8

Balance Sheet

9

Statement of Changes in Equity

10

Notes to the Financial Statements

11

DIRECTORS:

S A Harris

E H Thomson

REGISTERED OFFICE:

148-150 Buckingham Palace Road

3rd Floor

London

SW1W 9TR

REGISTERED NUMBER:

03810820 (England and Wales)

AUDITORS:

Rothmans Audit LLP

Chartered Accountants & Statutory Auditors

24 Park Road South

Havant

Hampshire

PO9 1HB

The directors present their strategic report for the year ended 30th June 2018.

REVIEW OF BUSINESS

Committed Capital Financial Services Limited ("CCFS" or "the Company") manages an open ended EIS fund

operation, called the Committed Capital Growth EIS Portfolio Service ("CC Growth"). CC Growth invests in promising

high growth UK technology businesses. As part of the investment process, the Company reviews a large number of

potential investee companies and, on satisfying the Company's selection criteria, will select around 1-2% (around 2 to

4 new investments in total per year) of the investee companies reviewed for investment. CCFS then undertakes a

rigorous due diligence process on behalf of the Company and its investors into the investee company, to confirm

suitability for investment. Via CC Growth investors, CCFS then arranges investment into the investee company. CCFS

then monitors developments of investee companies until the companies are sold, primarily by having an Investor

Director or Observer on the investee company's board of directors. During the financial year ended 30 June 2018, the

funds under management increased ("FUM") from £12.0m to £23.2m on a cost basis and investment into investee

companies amounted to £22.7m (2017: £11.6m). The Company has 14 investee companies as at end of June 2018

(2017: 11), of which 3 were invested in prior to the formation of CC Growth.

CCFS generates advisory and consulting fees and success-based fees from its investee companies. In addition, CC

Growth provides recurring revenue to CCFS from the annual management fees it generates. It also charges one-off

set-up fees for funds that invest via CC Growth. During the 2018 financial year, CCFS improved consulting and

advisory fees of £124.1k (2017: £100.6k) as the number of investee companies increased. Meanwhile, success fees

improved from £425.2k to £673.9k as funding increased. Fund set-up fees also improved by 228% from £80.3k in 2017

to £263.5k in 2018. Improved performance is partly a result of growing funds under management, and partly resulting

from the Company's increasing ability to negotiate commercial terms with investors. Quarterly management fees

increased in line with FUM growth.

During 2018, the Company has reviewed its accounting policy with regard to carried interest income and, following

external advice and examining general market practice, has determined that recognition of unrealised carried interest

income (before it is certain) is not appropriate to presenting a true and fair view of the Company's results. Therefore, it

has changed its accounting policy in this regard. No restatements have been considered necessary owing to the figures

noted in 2017 being immaterial. Further information is provided in the accounting policies note 2 on page 13.

The directors are optimistic that CC Growth and related management fees will continue to grow, allowing increased

investment in existing and new investee companies to grow as well. Together the directors believe this will provide a

solid base for continued improved performance and Company growth in the future.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks faced by the Company are as follows:

- Compliance with the regulatory environment, including the FCA's rules and regulations. When the need arises, the

Company employs regulatory and compliance consultants to supplement its internal compliance function to ensure that

FCA rules, regulations and reporting requirements are met.

- Having an adequate pipeline of new investee companies. The Company maintains an active network of relevant

industry players, attends a selection of networking events and has close links with other investors, through which it

receives a good pipeline of potential investee companies.

- Continuity of commercial success of portfolio companies. While there is a large degree of uncertainty in the young

investee companies in which CC Growth invests, the Company undertakes a rigorous investment process, including

undertaking a detailed due diligence process to identify potential problems; adjusting valuation or taking mitigating

action; obtaining board representation; and negotiating investor protections, and, where applicable, vetoes on material

decisions.

- Adequacy of resourcing to meet further growth. The directors are aware of the increasing volume of business and

monitor resources available actively. The Company has a resource plan in place to ensure resourcing in all areas is

adequate, in order to achieve the forecast growth of the business.

COMPANY PERFORMANCE

The Company measures its progress in terms of the quality of its investments, which is reflected in revenues and gross

profit growth and, ultimately, EBITDA growth and successful sale of portfolio companies. During the year ended June

2018, the Company arranged 13 investments totalling £11.1m including: 10 follow on investments in existing investee

companies and 3 investments into 3 exciting new investee companies. This compares with £6m in 2017, which

represented 13 investments, including 3 new investee companies.

Development of CC Growth and resultant recurring income are also core to the future success of the Company. Over

the year, CC Growth has progressed well but recurring revenues have fallen slightly from 11% of total revenues to

10.5% of revenues, although overall these revenues grew nearly 50%. The ratio of discretionary funds under

management, as opposed to those where investors themselves select their investments, has decreased from 29% to

23%; it is the aim of the business to reverse this trend as it affects recurring revenues and ability to move faster on

investment.

Overall, the Company's turnover grew from £669k to £1,152k, with the majority of the growth being from a 59%

increase in success fees and a 228% increase in set up fees. Together these contributed 89% of the overall revenue

growth.

Follow on investments into investee companies is generating continued interest from existing and new investors into

CC Growth, as valuations are increasing.

Net profit before tax for 2018 is significantly up at £282k against £142k in 2017. During the year, the Company has

continued to keep a tight control on marketing costs, and for the current year spent £2.6k (2017: £27.5k). For the

coming year this is likely to increase, as the directors believe the timing is now right to raise CC Growth's profile. Staff

costs increased as we recruited another advisory individual into CCFS, and the CEO's salary was brought into line with

market rates. Sales staff costs were cut in line with forecasts last year, and fixed costs vs incentivisation costs of sales

staff is closely monitored. Pension costs increased in line with the regulatory requirements of the Work Place Pension.

Further investment in advisory staff is likely to occur in the 2018-19 financial year and the sales team is also likely to

grow during this period as well. The other significant increase in operating costs was the increase in irrecoverable VAT

- this is a function of the nature of CCFS's business in financial services, and the increasing element of direct financial

advice, which is exempt and affects recoverability of input VAT.

Given the current pipeline of investments and ongoing discussions with potential investors into the CC Growth, as well

as active monitoring of the Company's cost base, the directors remain optimistic of further improved performance in

future years.

ON BEHALF OF THE BOARD:

E H Thomson - Director

18th December 2018

The directors present their report with the financial statements of the company for the year ended 30th June 2018.

PRINCIPAL ACTIVITIES

The principal activity of the Company in the year under review was that of a EIS fund management business focussed

on benefitting investors from EIS qualifying investment, searching the UK market for suitable UK based high growth

technology companies for our investors. The Company works with those investee companies, providing corporate

finance advice in respect of fund raising and acquisition advice, and developing their businesses whilst also providing

suitable investment candidates for our investors to invest in and providing finance for such promising UK-based

smaller companies.

The Company is authorised and regulated by the Financial Conduct Authority (FCA) as a BIPRU €50k limited licence

firm.

DIVIDENDS

No dividends will be distributed for the year ended 30th June 2018.

FUTURE DEVELOPMENTS

Given the current pipeline of investments and ongoing discussions with potential investors into the CC Growth, the

directors remain optimistic of further improved performance in future years.

DIRECTORS

S A Harris has held office during the whole of the period from 1st July 2017 to the date of this report.

Other changes in directors holding office are as follows:

A Bloxam - resigned 12th September 2017

E H Thomson - appointed 12th October 2017

POST BALANCE SHEET EVENTS

There are no post balance sheet events.

DISCLOSURE IN THE STRATEGIC REPORT

The directors have taken advantage of the option to disclose information relating to risk exposure within the strategic

report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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 United Kingdom Generally Accepted

Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 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

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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies

Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought

to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish

that the company's auditors are aware of that information.

AUDITORS

The auditors, Rothmans Audit LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

E H Thomson - Director

18th December 2018

Opinion

We have audited the financial statements of Committed Capital Financial Services Limited (the 'company') for the year

ended 30th June 2018 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of

Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The

financial reporting framework that has been applied in their preparation is applicable law and United Kingdom

Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the

UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 30th June 2018 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; 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 under those standards are further described in the Auditors' responsibilities for the audit of the

financial statements section of our report. We are independent of the company in accordance with the ethical

requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard,

and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit

evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to

you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the

Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the

Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise

explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing

so, consider whether the other information is materially inconsistent with the financial statements or our knowledge

obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or

apparent material misstatements, we are required to determine whether there is a material misstatement in the

financial statements or a material misstatement of the other information. If, based on the work we have performed, we

conclude that there is a material misstatement of this other information, we are required to report that fact. We have

nothing to report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the

audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us 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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are

responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view,

and for such internal control as the directors determine necessary to enable the preparation of financial statements that

are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for 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 the directors either intend to liquidate the company or to cease operations, or have no realistic

alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

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 a Report of the Auditors that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a 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 the aggregate, they could reasonably be expected to influence the

economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting

Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

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 a Report of the Auditors 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.

Julian Sims (Senior Statutory Auditor)

for and on behalf of Rothmans Audit LLP

Chartered Accountants & Statutory Auditors

24 Park Road South

Havant

Hampshire

PO9 1HB

12th March 2019

TURNOVER

3

1,151,578

669,165

Cost of sales

(416,221

)

(210,250

)

GROSS PROFIT

735,357

458,915

Administrative expenses

(506,618

)

(327,889

)

228,739

131,026

Surplus/(Deficit) on revaluation of fixed asset investments

42,198

-

OPERATING PROFIT

5

270,937

131,026

Interest receivable and similar income

6

12,930

11,174

283,867

142,200

Amounts written off investments

7

(1,342

)

-

PROFIT BEFORE TAXATION

282,525

142,200

Tax on profit

8

(35,428

)

(8,143

)

PROFIT FOR THE FINANCIAL YEAR

247,097

134,057

FIXED ASSETS

Investments

9

88,705

47,849

CURRENT ASSETS

Debtors

10

1,801,295

1,413,235

CREDITORS

Amounts falling due within one year

11

276,092

102,291

NET CURRENT ASSETS

1,525,203

1,310,944

TOTAL ASSETS LESS CURRENT LIABILITIES

1,613,908

1,358,793

PROVISIONS FOR LIABILITIES

12

8,018

-

NET ASSETS

1,605,890

1,358,793

CAPITAL AND RESERVES

Called up share capital

13

45,000

45,000

Revaluation reserve

14

34,180

-

Retained earnings

14

1,526,710

1,313,793

SHAREHOLDERS' FUNDS

1,605,890

1,358,793

The financial statements were approved by the Board of Directors on 18th December 2018 and were signed on its behalf by:

E H Thomson - Director

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1st July 2016

45,000

1,179,736

-

1,224,736

Changes in equity

Total comprehensive income

-

134,057

-

134,057

Balance at 30th June 2017

45,000

1,313,793

-

1,358,793

Changes in equity

Total comprehensive income

-

247,097

-

247,097

Transfer revaluation

to non-distributable reserve

-

(42,198

)

42,198

-

Transfer deferred tax

revaluation from profit and

loss reserve

-

8,018

(8,018

)

-

Balance at 30th June 2018

45,000

1,526,710

34,180

1,605,890

1.	STATUTORY INFORMATION

Committed Capital Financial Services Limited is a company limited by shares incorporated in England and

Wales. The Company's registered office is 148-150 Buckingham Palace Road, 3rd Floor, London, SW1W 9TR,

England.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

The financial statements are presented in Sterling (£) and rounded to the nearest pound (£).

The financial statements relate to Committed Capital Financial Services Limited as an individual entity.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemption in preparing these financial

statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of

Ireland" :

- the requirements of certain disclosures as detailed under section 1.12, except for the requirement of Section

33 Related Party Disclosures paragraph 33.7.

Preparation of consolidated financial statements

The financial statements contain information about Committed Capital Financial Services Limited as an

individual company and do not contain consolidated financial information as the parent of a group. The

company is exempt under Section 400 of the Companies Act 2006 from the requirements to prepare

consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the

consolidated financial statements of its parent, Committed Capital Limited, 148 - 150 Buckingham Palace

Road, 3rd Floor, London, SW1W 9TR, England.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party

transactions with wholly owned subsidiaries within the group.

Significant judgements and estimates

Preparation of financial statements requires management to make significant judgements and estimates, which

are continually reviewed and evaluated based on historical experience and future expectations.

The critical judgements made in applying the Company's accounting policies are:

Fixed asset investments

Fixed asset investments in subsidiaries are held at cost less any impairment. The extent of any impairment is

assessed annually and adjusted as necessary. Fixed asset investments in unlisted securities are reviewed

annually and revalued at fair value.

Other Investments

Investments are valued at what Directors consider fair value. This may be cost, if the stock is newly invested;

the latest share price at which investment has been raised; or a more detailed valuation taking account of

BVCA valuation methodologies may be applied. Further details of calculation methodologies are given later in

this Note 2 under "Investments".

Revenue

Revenue is sourced from: management fees and set up fees from investors investing into CC Growth, which

the Company manages; retainer and document preparation fees; fund raising fees and ongoing monitoring fees

from investee companies; advisory fees for sale and purchase of businesses; and other advisory work.

Fund set up fees are recognised at the point that they become due.

Management fees and investee company monitoring fees are recognised over the time that they are incurred.

Retainers and document preparation fees are recognised in accordance with contractual arrangements with a

client or investee company.

Fund raising fees are recognised when Directors judge that an investment is fairly certain to occur (a probability

may be assigned to it) and work has been undertaken in respect of that fund raising and, ultimately, fully

recognised when funds raised are transferred to the investee company.

An element of advisory fees due from the sale and / or purchase of businesses may be recognised, when

Directors judge that a transaction is likely to happen and work has been carried out in relation to such

transaction; the full fee will be recognised when the transaction is closed.

Income from other advisory work is recognised in line with contractual arrangements, unless there is a

contingent element, in which case a proportion may be recognised depending on Directors' judgement, and

amount of work undertaken; the full contingent amount will be recognised on closing.

The items in the financial statements where critical estimates and assumptions have been made are:

VAT

The Company is registered for VAT and completes a quarterly group return with its parent. Because part of the

Company's income is exempt from VAT, the group has to complete a return including a partial exemption

calculation. Therefore, some input VAT is irrecoverable, and that VAT is ultimately charged back to the

Company at the time that the irrecoverable VAT is crystallised.

Accruals

Accruals are estimated based on historical cost patterns and products and services provided to the Company

but not yet invoiced prior to the year end.

Accrued income

Accrued income is based on work mandated or commenced prior to the year end, but not yet invoiced for. The

Directors estimate the income based on likelihood of success that the transaction will complete and work

actually undertaken prior to the year end.

Bad debts

Provisions for doubtful debts are made where the Directors judge that a debtor is unlikely to pay.

Turnover

Turnover represents amounts receivable for services net of VAT.

Investments in subsidiaries

Investments in subsidiary undertakings are recognised at cost.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive

Income, except to the extent that it relates to items recognised in other comprehensive income or directly in

equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or

substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences which are differences between taxable profits and

total comprehensive income that arise from the inclusion of income and expenses in tax assessment periods

different from those in which they are recognised in the financial statements.

Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in

which timing differences are expected to reverse, based on tax rates and laws enacted or substantively enacted

at the balance sheet date.

Revenue recognition

Fee income represents revenue earned under a wide variety of contracts to provide professional services.

Revenue is recognised as earned when, and to the extent that, the firm obtains the right to consideration in

exchange for its performance under these contracts. It is measured at the fair value of the right to

consideration, which represents amounts chargeable to clients, including expenses and disbursements but

excluding value added tax.

Revenue is generally recognised as contract activity progresses so that, for incomplete contracts, it reflects the

partial performance of the contractual obligations. For such contracts, the amount of revenue reflects the

accrual of the right to consideration by reference to the value of work performed. Revenue not billed to clients

is included in debtors and payments on account in excess of the relevant amount of revenue are included in

creditors.

Carried interest

Carried interest represents the profit the Company makes on Investee Companies that have been held by

investors in CC Growth and is recognised when the Investee Company is disposed of. The profit to the investor

of investing in an Investee Company is calculated by taking the exit value of the Investee Company, deducting

all the costs of investment, including set-up and management fees, incurred by the investor. CCFS is entitled

to a certain percentage of the profit and this is the Carried Interest. Carried Interest in respect of investment

outside of the fund are treated in a similar way.

During the 2018 financial year, the Company reviewed its accounting policy with regard to carried interest and,

having considered current market practice and having taken external advice, has tightened its policy with regard

to recognising Carried Interest in its accounts. The Company now recognises Carried Interest only on actual

realisation, that is, when an exit of an investee company occurs. As a result of this change in policy, the

Company will make a downward adjustment of £2,245 in total to the Profit and Loss Account, including a write

off of investments of £1,342. For 2017, if the same accounting policy were applied, the effect on the Profit and

Loss account would be a decrease of £2,245, and a write off of investments in the balance sheet of £1,342.

Fixed asset investments

Fixed asset investments are stated at historical cost less provision for diminution in value, in respect of

investments in subsidiary undertakings.

With respect to the valuation of unlisted fixed asset investments, British Venture Capital Association valuation

guidelines describe a number of valuation methods suitable for valuing investments in private companies.

The Company normally values its interests in portfolio companies by reference to material recent issues of

equity and any available market prices. Where no such benchmark exists, the Company may also value its

interests based on multiples of revenues or profit, discounted cash flow or other sector specific methodology.

Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are

required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee's services are

received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed

to terminate the employment of an employee or to provide termination benefits.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension

scheme are charged to the profit and loss account in the period to which they relate.

Financial instruments

Financial instruments are recognised in line with sections 11 and 12 of FRS 102.

Basic financial instruments, such as bank and cash, loans, amounts due to/from group undertakings, trade

receivables and payables are initially recognised at transaction price, unless they constitute a financing

arrangement, when the transaction is measured at the present value of the future receipts discounted at a

market rate of interest.

Such assets are subsequently carried at amortised cost using the effective interest rate method.

Transfer to a non-distributable reserve

By virtue of FRS 102 (appendix IV sA4.28) any gains or losses on the fair value of investments have been

transferred from retained earnings to a specific non-distributable reserve called Revaluation Reserve. Similarly

all deferred tax relating to these fair value movements have been transferred to this same non-distributable

reserve.

3.

TURNOVER

The turnover and profit before taxation are attributable to the principal activities of the company.

An analysis of turnover by class of business is given below:

2018

2017

£

£

Rendering of services

470,241

237,891

Corporate finance advice

681,337

431,274

1,151,578

669,165

4.	EMPLOYEES AND DIRECTORS

2018

2017

£

£

Wages and salaries

219,422

87,706

Social security costs

25,635

10,968

Other pension costs

2,558

684

247,615

99,358

The average number of employees during the year was as follows:

2018

2017

Director

1

1

Consultant

1

-

2

1

2018

2017

£

£

Directors' remuneration

171,480

90,485

5.	OPERATING PROFIT

The operating profit is stated after charging:

2018

2017

£

£

Auditors' remuneration

2,500

3,050

Auditors' non-audit remuneration

900

1,000

6.

INTEREST RECEIVABLE AND SIMILAR INCOME

2018

2017

£

£

Bank interest receivable

5

-

Interest on preference shares

12,925

11,174

12,930

11,174

7.

AMOUNTS WRITTEN OFF INVESTMENTS

2018

2017

£

£

Amounts written off

investments

1,342

-