Registered number: 08314801
CEZANNE HR LIMITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 DECEMBER 2022
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CEZANNE HR LIMITED
REGISTERED NUMBER: 08314801
BALANCE SHEET
AS AT 31 DECEMBER 2022
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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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CEZANNE HR LIMITED
REGISTERED NUMBER: 08314801
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 10 October 2023.
The notes on pages 5 to 15 form part of these financial statements.
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CEZANNE HR LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
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Comprehensive income for the year
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Total comprehensive income for the year
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Total transactions with owners
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The notes on pages 5 to 15 form part of these financial statements.
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CEZANNE HR LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
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Comprehensive income for the year
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Other comprehensive income for the year
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Total comprehensive income for the year
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Total transactions with owners
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The notes on pages 5 to 15 form part of these financial statements.
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Cezanne HR Limited is a private company limited by shares. The company was incorporated in the United Kingdom and is registered in England and Wales. The registration number is 08314801. The registered address is 57 Southwark Street, London, England, SE1 1RU.
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 Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The following principal accounting policies have been applied:
The company had negative profit and loss reserves at the year end of £6,005,760 (2021: £5,995,527). As the company continues to be supported by its parent company and the group to which this company belongs has seen support provided by a new investor post year end (refer note 15), the directors consider it is appropriate to prepare the financial statements on the going concern basis.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
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.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of income and retained earnings within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company 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:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of income and retained earnings in the same period as the related expenditure.
Interest income is recognised in profit or loss using the effective interest method.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to profit or loss over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Company keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.
Tax is recognised in profit or loss 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 balance sheet date in the countries where the Company operates and generates income.
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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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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:
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Short-term leasehold property
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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 profit or loss.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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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.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.
Financial instruments are recognised in the Company's Balance sheet when the Company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with 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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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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Financial instruments (continued)
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Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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Financial instruments (continued)
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course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
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The average monthly number of employees, including directors, during the year was 74 (2021 - 54).
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Short-term leasehold property
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Charge for the year on owned assets
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In 2022 there has been a reclassification of the Plant and machinery asset class to Computer equipment as this better represents the nature of the assets within this asset class.
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Due after more than one year
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Prepayments and accrued income
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Cash and cash equivalents
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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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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Allotted, called up and fully paid
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1 (2021 - 1) Ordinary share of £1.00
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Other reserves
Other reserves consist of equity-settled share options made to employees and capital contributions from
group companies.
Profit and loss account
Includes all current and prior year retained profits and losses.
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Cezanne HR Limited's parent company, Cezanne HR (Holding) Limited, has an Enterprise Management Incentive Scheme ("EMI") which is available to UK employees who work for the Company or a group company and satisfy the qualifying conditions and the EMI working time requirements. The parent company also has an Unapproved Share Options Scheme which is available at the Director's discretion.
Both schemes are equity-settled.
The company had elected to take the exemption against applying retrospective application of equity-settled share based payments which were granted before the start of its first period reporting in
accordance with FRS 102. Up to 31 December 2017 Cezanne HR (Holding) had granted the following
share options to employees of Cezanne HR Limited. In November 2014 138,000 options were granted to employees under the EMI scheme with an exercise price of £4.07. Of the share options issued under the EMI scheme, 47,500 had lapsed due to the termination of the option holder's employment as at 31/12/2021. This left 90,500 options still outstanding. All those are currently vested and exercisable for £4.07. There were no share options granted in 2022. All the remaining options were then exercised on 21 March 2023.
In May 2014, 22,680 options and in September 2017 a further 67,200 options were granted to the directors under the Unapproved Share Options Scheme with an exercise price of £0.10 per share. Share options issued by the parent company since 1 January 2018 that relate to the services of employees of Cezanne HR Limited have been recorded as a charge to the profit and loss and within Other Reserves. 98,480 options were granted since 1 January 2018 to 31 December 2020. A further 35,400 were granted on 21st June 2021 that resulted in a charge of £142,121. A further 45,517 were granted on 15th December 2021 that resulted in a further charge of £182,738. All the share options are vested and exercisable for £0.10 at any time. There were no share options granted in 2022. All of these share options lapsed on 21 March 2023.
The fair value of each option has been calculated using the Black Scholes model, taking into account the price paid by shareholders on the incorporation of the group, together with assumptions about the historic and future performance of the group and with reference to market performance.
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The company operates a defined contributions pension scheme. The assets of the scheme are held
separately from those of the company in an independently administered fund. The pension cost charge
represents contributions payable by the company to the fund and amounted to £139,635 (2021: £104,515). Contributions totalling £533 (2021: £44,171) were payable to the fund at the balance sheet date and are included in other creditors.
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CEZANNE HR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Commitments under operating leases
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At 31 December 2022 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Transactions with directors
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During the year the directors received advances of £3,490 (2021: £3,260). Repayments totalling £3,559
(2021: £2,653) were made during the year.
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Related party transactions
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At the year end, included in other creditors, is an amount of £703 (2021: £634) owed to the directors.
The company has taken advantage of the exemption allowed by FRS 102 not to disclose transactions
with other wholly owned members of the group.
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Post balance sheet events
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On 21 March 2023, 43.56% of the issued equity share of Cezanne HR Limited’s parent company Cezanne HR (Holding) Limited was acquired by North Edge Capital SME Fund 1 LP and North Edge SME Co-investment, LP. As part of the purchase agreement cash was injected into the group.
The company is controlled by Cezanne HR (Holding) Limited, its parent company, by virtue of its 100% shareholding. Cezanne HR (Holding) Limited has no ultimate controlling party.
The auditors' report on the financial statements for the year ended 31 December 2022 was unqualified.
The audit report was signed on 10 October 2023 by Daniel Reid FCA (Senior statutory auditor) on behalf of Donald Reid Limited.
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