Equiteq_Advisors_Limited - Accounts

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies' regime.

Equiteq Advisors Limited is a private company limited by shares incorporated in England and Wales. The registered office is Devonshire House, 60 Goswell Road, London, EC1M 7AD.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest pound.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

At the time of approving the financial statements, the Directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

The company is part of an international group headed by Equiteq M&A Holdings Limited, which operates largely as one business, sharing resources and financing, to deliver its services to clients. As such, the directors going concern assessment for the company is based on the group as a whole.

Whilst the COVID-19 pandemic significantly impacted the group’s revenue during the first half of 2020, the group’s response in reducing its monthly cost base, establishing new credit facilities, and utilizing government assistance programs in its operating jurisdictions, positioned it to continue trading through 2020, and it is expected to operate profitably for the full year. The impact on 2020 revenues was such that project delivery was delayed, rather than cancelled, and the pace of new business remained strong throughout the year. As a result, the group enters 2021 with record WIP, and is well positioned to convert that WIP into the minimal number of success fees required to meet its obligations in 2021.

The directors continue to closely monitoring the impact of the COVID-19 pandemic, and the measures taken to contain it, on the group’s activities and have considered that impact on completing projects and selling new mandates in preparing a forecast for 2021. Because of the nature of the group’s activities and the ability of our staff and the majority of our clients to work remotely, whilst the ultimate impact of the pandemic cannot be precisely quantified, the directors do not expect the pandemic to significantly affect the ability of the group to continue in business and meet its liabilities as they fall due.

The Company engages in mergers and acquisitions advisory services. Turnover comprises revenue recognised by the company in respect of success fee income and retainer fee income net of VAT.

Success fee income represents revenue earned under contracts for the provision of mergers and acquisitions services. Success fee income that is contingent on events outside the control of the firm is recognised when the contingent event occurs, and therefore success fees are recognised on the date of which the buyer purchases the business from the seller. It is measured at the fair value of the right to consideration, which represents amounts chargeable to clients, including expenses and disbursements.

Retainer fees income 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.

Acquired goodwill is written off in equal annual instalments over its estimated useful economic life of 20 years.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date if the fair value can be measured reliably.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

Basic financial instruments are measured at amortised cost. The company has no other financial instruments or basic financial instruments measured at fair value.

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

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

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.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the profit and loss account for the period.

The average monthly number of persons (including directors) employed by the company during the year was 24 (2018 - 18).

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

The disclosure exemption conferred by FRS 102 Section 33:1A has been utilised, whereby the company has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertaking of the group.

At the balance sheet date, the company owed £71,940 (2018: £526,940) to its directors. Interest of £51,570 (2018: £nil) has been charged to the company in respect of these balances. These amounts are included within other creditors due within one year.

At the balance sheet date, the company was due £nil (2018: £23,694) from its directors. No interest is being charged on these balances. These amounts are included within other debtors due within one year.

At the balance sheet date, the company owed an amount of £1,350,263 (2019: £2,196,115) to a company of which the directors have significant influence over. These amounts are included within other debtors in over one year.

At the balance sheet date, the directors of the company had advanced personal guarantees to the bankers of Equiteq Advisors Limited amounting to £265,000 (2018: £265,000).

At the balance sheet date, Equiteq M&A Holdings Limited has provided a limited guarantee up to £265,000 (2018: £265,000) to the bankers of Equiteq Advisors Limited.

The immediate parent company is Equiteq M&A Holdings Limited by virtue of its 100% paid up share capital, a company incorporated in England and Wales.

As the income statement has been omitted from the filing copy of the financial statements the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

We draw attention to note 1.2 in the financial statements, in which the directors describe the impact of the COVID-19 pandemic, and their basis for continuing to prepare the financial statements on a going concern basis. As stated in note 1.3 the directors expect the business to generate sufficient success fees to meet its obligations in 2021. However, it is uncertain at this time how the COVID-19 pandemic will impact on the world economy in 2021, with many predicting a deep global recession. Such circumstances may make it difficult for the business to achieve the success fees it requires in the time frames expected. As a result, the potential impact of the COVID-19 pandemic creates an inherent material uncertainty within the M&A market that may cast doubt on the business’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.