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Registered number: 06081030
KYTE BROKING GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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KYTE BROKING GROUP LIMITED
COMPANY INFORMATION
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J C Barr (resigned 23 December 2022)
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Chartered Accountants & Statutory Auditor
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KYTE BROKING GROUP LIMITED
CONTENTS
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Independent auditors' report
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Consolidated statement of comprehensive income
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Consolidated statement of financial position
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Company statement of financial position
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Consolidated statement of changes in equity
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Company statement of changes in equity
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Consolidated statement of cash flows
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Notes to the financial statements
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KYTE BROKING GROUP LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
The directors present their strategic report for the year ended 31 March 2023.
The principal activity of Kyte Broking Group Limited and it's two subsidiary companies, (the "Group") continues to be that of brokering financial instruments through across a wide range of products and markets, by providing services to brokers the company earns a % on all commissions generated. The subsidiary company, Kyte Broking Limited is authorised and regulated by the Financial Conduct Authority (FCA).
The Group made a profit of £ 6,336,801 before tax in the year 31 March 2023 (31 March 2022: £ 1,552,053). The directors are satisfied with the performance of the Group, given the prevailing market conditions and increase in the regulatory costs. The directors remain confident of the sustainability of the business and anticipate continued growth in future due to continued investment in automation and infrastructure within the firm. Management has also increased efforts on expanding and growing existing brokerage desks by recruiting more brokers & enhancing product range available to clients, which has contributed considerably to the improved financial performance of the firm. And will continue to be pursued in coming years.
Principal risks and uncertainties
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The key risks to the business are a potential reduction in the trading volumes due to current economic climate and fears of a pending recession. The political and economic uncertainty has regularly created market volatility throughout the year which has at times caused a chaotic environment for the brokers & their clients, however this has not had an adverse effect on the firm. The firm continue to operate and expand the Organised Trading Facility, the firm is still seeing growth in activity associated with this and we continue to attract new business. Brexit safeguards were implemented to reduce the risk, including regulating a new entity in France, which has ultimately reduced the implications of Brexit on the firm. Additionally, we continue to diversify and grow our activity to counterbalance this threat, opening and developing new and existing brokerage desks in the current year. The rise in interest rates globally has caused a shift in popularity of certain products but the firm offers a well-diversified range of products meaning reduced training in some products has been offset by increased trading in others. Other risks including credit risk, market risk, foreign currency risk and liquidity risk, are detailed in the notes to the accounts.
Financial key performance indicators
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Management uses a series of Key Performance Indicators (KPIs) to monitor performance and financial conditions.
The primary KPIs for the Company are Revenue which have increased to £ 87,133,791 from (£ 72,810,141 in 2022).
The net revenue income margin before tax which has increased from, 2% to 7% due to higher revenues and associated cost of sales the profit shares received from broking franchises & Profit share from broking franchises have remained similar at £ 5,287,361 in the year ending 31 March 2023 when compared to the year ending 31 March 2022 (£3,900,238 in 2022). The board of directors considers this level of performance satisfactory given the prevailing market conditions.
Other key performance indicators
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Gross Margin has increased to 19% (March 2023) from 12% (March 2022).
Revenue per Admin Expense Ratio has Increased in the year.
2023 1.63:1
2022 1.23:1
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KYTE BROKING GROUP LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
Directors' statement of compliance with duty to promote the success of the Group
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The Directors of the Group are acutely aware of the requirement for them to act in the way they consider, in good faith, would be most likely to promote the success of the Group for the benefit of its members as a whole. In considering this Duty the Directors consider the following stakeholders:
Shareholders
The Directors have regular contact with the shareholder which ensures that the business strategy of the Group is completely aligned with the strategic objectives of the shareholder.
Employees
A regular networking meeting of Executive Directors and management team meet on a regular basis to provide information for management to cascade to their teams and to enable Executive Directors to interact freely with employees. The Group also provides internal communications and regular staff and management meetings as well as a whistleblowing hotline.
Customers
The Group has a varied customer base including institutional banks, fund manager, hedge funds, and corporates, the Group has always been a customer needs led organisation and treating customers fairly is ingrained in the organisation. The behaviour of employees towards customers is governed by the Group policies and the FCA's requirements.
Suppliers
We have various key supplier relationships which work more as a partnership which ensures the smooth running of our business.
Community and the environment
As a group, Kyte Broking Group Limited encourages and provides sponsorship to employees to take part in various charity events globally.
This report was approved by the board and signed on its behalf.
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KYTE BROKING GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
The directors present their report and the audited financial statements for the year ended 31 March 2023.
Directors' responsibilities statement
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The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated audited financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare audited financial statements for each financial year. Under that law the directors have elected to prepare the audited financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the audited financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these audited financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the audited financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to enable them to ensure that the audited financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The principal activity of the Company is that of a holding company.
The principal activity of the Group is that of brokering financial instruments through across a wide range of products and markets, by providing services to brokers, the Company earns a percentage on all commissions generated.
The profit for the year, after taxation, amounted to £5,134,027 (2022 - £1,222,880).
The directors do not recommend the payment of a final dividend (2022: £nil).
The directors who served during the year were:
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J C Barr (resigned 23 December 2022)
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KYTE BROKING GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
As detailed in the Strategic Report the directors remain confident about the long-term future prospects of the business. The Group’s main goals are to continue to increase broker recruitment and as a result of this increase revenues. Development of our internal technology is also set to continue to improve automation and this should result in costs savings as internally developed software replaces software purchased externally.
Disclosure of information to auditors
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Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.
Post balance sheet events
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There have been no significant events affecting the Group since the year end.
Under section 487 (2) of the Companies Act 2006, BKL Audit LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
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KYTE BROKING GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KYTE BROKING GROUP LIMITED
We have audited the financial statements of Kyte Broking Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2023, which comprise the Group Statement of Comprehensive Income, the Group and Company Statements of Financial Position, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity and the related notes, 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 Group's and of the parent Company's affairs as at 31 March 2023 and of the Group's 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.
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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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
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In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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KYTE BROKING GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KYTE BROKING GROUP LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual Report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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
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In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
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In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the Directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
∙the parent Company 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
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As explained more fully in the Directors' responsibilities statement set out on page 3, 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 is 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 Group's and the parent 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 Group or the
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KYTE BROKING GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KYTE BROKING GROUP LIMITED (CONTINUED)
parent Company or to cease operations, or have no realistic alternative but to do so.
Auditors' responsibilities for the audit of the financial statements
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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 an Auditors' report 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
∙Enquiring of management around actual and potential litigation and claims;
∙Reviewing minutes of meeting of those charged with governance;
∙Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
∙Performing audit work over the risk of management override of controls, including testing of journal entires and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
∙Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
∙Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
∙Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
∙Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditors' report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditors' report.
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KYTE BROKING GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KYTE BROKING GROUP LIMITED (CONTINUED)
However, future events or conditions may cause the Company to cease to continue as a going concern.
∙Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
∙Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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 an Auditors' report 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.
Nick Bishop (ACA) (Senior Statutory Auditor)
for and on behalf of
BKL Audit LLP
Chartered Accountants
Statutory Auditor
London
31 July 2023
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KYTE BROKING GROUP LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
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Income from fixed asset investments
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Interest payable and similar expenses
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Profit for the financial year
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Profit for the year attributable to:
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Owners of the parent Company
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There were no recognised gains and losses for 2023 or 2022 other than those included in the consolidated statement of comprehensive income.
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There was no other comprehensive income for 2023 (2022:£NIL).
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The notes on pages 15 to 30 form part of these financial statements.
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KYTE BROKING GROUP LIMITED
REGISTERED NUMBER: 06081030
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 15 to 30 form part of these financial statements.
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KYTE BROKING GROUP LIMITED
REGISTERED NUMBER: 06081030
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2023
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Debtors: amounts falling due after more than one year
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Profit and loss account brought forward
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Profit/(loss) for the year
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Profit and loss account carried forward
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 15 to 30 form part of these financial statements.
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KYTE BROKING GROUP LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
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Equity attributable to owners of parent Company
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Comprehensive income for the year
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Total comprehensive income for the year
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Comprehensive income for the year
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Total comprehensive income for the year
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The notes on pages 15 to 30 form part of these financial statements.
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KYTE BROKING GROUP LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
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Comprehensive income for the year
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Total comprehensive income for the year
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Comprehensive income for the year
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Total comprehensive income for the year
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The notes on pages 15 to 30 form part of these financial statements.
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KYTE BROKING GROUP LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
Cash flows from operating activities
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Profit for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Income from fixed asset investments
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(Increase) in amounts owed by groups
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(Decrease)/increase in amounts owed to groups
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Net cash generated from operating activities
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Cash flows from investing activities
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Income from fixed asset investments
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Net cash from investing activities
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Cash flows from financing activities
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Net cash used in financing activities
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Net increase/(decrease) in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 15 to 30 form part of these financial statements.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
Kyte Broking Group Limited is a private limited company incorporated in England and Wales.
The principal activity of the Company is that of a holding company.
The principal activity of the Group is that of brokering financial instruments through across a wide range of products and markets, by providing services to brokers, the Company earns a percentage on all commissions generated.
The principal place of business is 55 Baker Street, London, England, W1U 8EW.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland ("FRS 102") and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
The financial statements have been prepared on the going concern basis, which assumes that the Company will continue to trade for the foreseeable future, being a period of at least twelve months from the date of approval of these financial statements, and will be able to meet its debts as they fall due.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
2.Accounting policies (continued)
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is Sterling.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Revenue relates to net brokerage commissions which are recognised on the trade date regardless of when the payment is received.
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Income from fixed asset investments
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Income from fixed asset investments represents profit shares from UK franchised broking LLPs of which the Company is a member and is recognised in the Consolidated Statement of Comprehensive Income when the right to the profit share is determined.
Finance costs are charged to the Consolidated Statement of Comprehensive Income over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in Consolidated Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
2.Accounting policies (continued)
Tax is recognised in the Consolidated Statement of Comprehensive Income except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company and the Group operate and generate income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
∙Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
Development expenditure is capitalised only if the expenditure can be measured reliably, is technically and commercially feasible, future economic benefits are probable and the Group intends to and has sufficient resources to complete development and use of the asset. Otherwise it is recognised in the Consolidated Statement of Comprehensive Income as incurred.
Amortisation is provided to write off the cost less the estimated residual value of intangible assets on a straight line basis over the estimated useful economic life of between 2 and 5 years.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Consolidated Statement of Comprehensive Income.
Investments in subsidiaries are measured at cost less accumulated impairment.
Investments are in unlisted entities, which have been classified as fixed asset investments as the Company intends to hold them on a continuing basis. The investments are held at cost.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
(i) Financial assets
Basic financial assets, including trade and other debtors, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where 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 method. At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the Consolidated Statement of Comprehensive Income.
(ii) Financial liabilities
Basic financial liabilities, including trade and other creditors and amounts owed to group undertaking, are initially recognised at transaction price, unless the arrangement constitutes a
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
2.Accounting policies (continued)
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Financial instruments (continued)
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financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
(iii) Offsetting
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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Judgements in applying accounting policies and key sources of estimation uncertainty
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The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgments (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
In preparing these financial statements the directors have made the following judgements;
1) Impairment of debtors
The Group makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including historical experience.
2) Capitalisation of development costs and useful life
Development expenditure represents expenditure incurred for building internal software which supports the services of the Group. Judgement is exercised by management when determining which costs meet the criteria for capitalisation and lead to future economic benefits sufficient to recover the capitalised costs. Intangible assets are amortised over their expected useful lives. The useful life used to amortise intangible assets relates to management's estimate of the period over which economic benefit will be derived from the asset.
There are no further judgements or estimates which materially effect the amounts in the financial statements.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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An analysis of turnover by class of business is as follows:
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All turnover arose within the United Kingdom.
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The operating profit/(loss) is stated after charging:
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Fees payable to the Group's auditor and its associated for the audit of the Group's annual financial statements
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Fees payable to the Group's auditor and its associates in respect of:
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Audit-related assurance services
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Taxation compliance services
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
Staff costs, including directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average number of employees, including the directors, during the year was as follows:
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Group contributions to defined contribution pension schemes
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During the year retirement benefits were accruign to 1 director (2022: 1) in respect of defined contribution pension schemes.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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Income from fixed asset investments
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Profit share from LLPs in which the Group is a member
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Interest payable and similar expenses
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Other loan interest payable
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Current tax on profits for the year
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Adjustments in respect of previous periods
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
11.Taxation (continued)
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Factors affecting tax charge for the year
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The tax assessed for the year is lower than (2022 - higher than) the standard rate of corporation tax in the UK of 19% (2022 - 19%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
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Capital allowances for year in excess of depreciation
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Adjustments to tax charge in respect of prior periods
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Short term timing difference leading to an increase (decrease) in taxation
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Other differences leading to an increase (decrease) in the tax charge
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Total tax charge for the year
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Factors that may affect future tax charges
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The UK Government announced its intention to increase the rate of UK corporation tax from 19% to 25% with effect from 1 April 2023. The increase in the rate of UK corporation tax was enacted in the Finance Act 2021, which received Royal Assent on 10 June 2021.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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Internally developed software
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Charge for the year on owned assets
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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Charge for the year on owned assets
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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Investments in subsidiary undertakings
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The following were subsidiary undertakings of the Company:
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Kyte Broking (Holdings) Limited
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55 Baker Street, London, W1U 8EW
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55 Baker Street, London, W1U 8EW
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The aggregate of the share capital and reserves as at 31 March 2023 and the profit or loss for the year ended on that date for the subsidiary undertakings were as follows:
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Aggregate of share capital and reserves
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Kyte Broking (Holdings) Limited
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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Amounts owed by group undertakings
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Amounts owed by group undertakings
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Prepayments and accrued income
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Cash and cash equivalents
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Creditors: Amounts falling due after more than one year
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The loans were made to Kyte Broking Group Limited on 20 May 2015 and are due for repayment in full ten years from that date. The interest due on these loans is at a rate of 12% per annum.
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Analysis of the maturity of loans is given below:
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Amounts falling due 2-5 years
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
|
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Allotted, called up and fully paid
|
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5,502,000 (2022 - 5,502,000) Ordinary shares of £1.00 each
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Foreign exchange reserve
Represents the value of the historic foreign exchange translation of the profit and loss and reserves from Euros (€) to British Pounds Sterling (£) when the functional currency was Euros.
Profit and loss account
Includes all current and prior period retained profits and losses.
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £66,850 (2022 - £74,152). Contributions totalling £19,652 (2022 - £20,372) were payable to the fund at the reporting date and are included in creditors.
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Related party transactions
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Where possible the Company has taken advantage of the exemption conferred by FRS 102 section 33.1A from the requirement to disclose transactions with other wholly owned group undertakings.
Included within other creditors due in greater than one year are balances of £Nil (2022 £800,000) due to companies owned by shareholders.
Also included within other creditors due in greater than one year are balances of £Nil (2022: £400,000) due to a shareholder.
Interest of 12% was charged on both these balances. Interest payable of £144,000 (2022: £144,000) is included in creditors at the year end.
During the year the loans were reassigned to a wholly owned group undertaking.
Investment income includes £1,841,472 (2022: £1,733,294) from an LLP in which the Group is a member.
Included within other creditors is a balance of £1,320,081 (2022: £951,686) due to an LLP in which the Group is a member.
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KYTE BROKING GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
The immediate and ultimate parent company is Market Securities Group Limited, a company incorporated in Hong Kong.
There is no ultimate controlling party.
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