SWIG Finance Limited 02688108 false 2022-04-01 2023-03-31 2023-03-31 The principal activity of the company is is providing small business loans to SMEs and start-ups as well as fund management in the South West of England. Digita Accounts Production Advanced 6.30.9574.0 true false 02688108 2022-04-01 2023-03-31 02688108 2023-03-31 02688108 bus:OrdinaryShareClass1 2023-03-31 02688108 bus:Consolidated 2023-03-31 02688108 core:RetainedEarningsAccumulatedLosses 2023-03-31 02688108 core:ShareCapital 2023-03-31 02688108 core:FinancialAssetsCostLessImpairment 2023-03-31 02688108 core:CurrentFinancialInstruments 2023-03-31 02688108 core:CurrentFinancialInstruments core:WithinOneYear 2023-03-31 02688108 core:Non-currentFinancialInstruments 2023-03-31 02688108 core:Non-currentFinancialInstruments core:AfterOneYear 2023-03-31 02688108 core:DevelopmentCostsCapitalisedDevelopmentExpenditure 2023-03-31 02688108 core:OtherResidualIntangibleAssets 2023-03-31 02688108 core:FurnitureFittingsToolsEquipment 2023-03-31 02688108 bus:SmallEntities 2022-04-01 2023-03-31 02688108 bus:Audited 2022-04-01 2023-03-31 02688108 bus:FullAccounts 2022-04-01 2023-03-31 02688108 bus:SmallCompaniesRegimeForAccounts 2022-04-01 2023-03-31 02688108 bus:RegisteredOffice 2022-04-01 2023-03-31 02688108 bus:Chairman 2022-04-01 2023-03-31 02688108 bus:Director15 2022-04-01 2023-03-31 02688108 bus:Director17 2022-04-01 2023-03-31 02688108 bus:Director18 2022-04-01 2023-03-31 02688108 bus:Director8 2022-04-01 2023-03-31 02688108 bus:OrdinaryShareClass1 2022-04-01 2023-03-31 02688108 bus:PrivateLimitedCompanyLtd 2022-04-01 2023-03-31 02688108 core:ComputerSoftware 2022-04-01 2023-03-31 02688108 core:DevelopmentCostsCapitalisedDevelopmentExpenditure 2022-04-01 2023-03-31 02688108 core:OtherResidualIntangibleAssets 2022-04-01 2023-03-31 02688108 core:ComputerEquipment 2022-04-01 2023-03-31 02688108 core:FurnitureFittings 2022-04-01 2023-03-31 02688108 core:FurnitureFittingsToolsEquipment 2022-04-01 2023-03-31 02688108 1 2022-04-01 2023-03-31 02688108 countries:EnglandWales 2022-04-01 2023-03-31 02688108 2022-03-31 02688108 core:DevelopmentCostsCapitalisedDevelopmentExpenditure 2022-03-31 02688108 core:OtherResidualIntangibleAssets 2022-03-31 02688108 core:FurnitureFittingsToolsEquipment 2022-03-31 02688108 2021-04-01 2022-03-31 02688108 2022-03-31 02688108 bus:OrdinaryShareClass1 2022-03-31 02688108 core:RetainedEarningsAccumulatedLosses 2022-03-31 02688108 core:ShareCapital 2022-03-31 02688108 core:FinancialAssetsCostLessImpairment 2022-03-31 02688108 core:CurrentFinancialInstruments 2022-03-31 02688108 core:CurrentFinancialInstruments core:WithinOneYear 2022-03-31 02688108 core:Non-currentFinancialInstruments 2022-03-31 02688108 core:Non-currentFinancialInstruments core:AfterOneYear 2022-03-31 02688108 core:DevelopmentCostsCapitalisedDevelopmentExpenditure 2022-03-31 02688108 core:OtherResidualIntangibleAssets 2022-03-31 02688108 core:FurnitureFittingsToolsEquipment 2022-03-31 iso4217:GBP xbrli:pure xbrli:shares

SWIG Finance Limited

Annual Report and Financial Statements
Year Ended 31 March 2023

Registration number: 02688108

 

SWIG Finance Limited

Contents

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

3 to 13

 

SWIG Finance Limited

Company Information

Chair

C H Allison

Directors

J Peters

D M Bullen

R L Pritchard

D I Brown

Registered office

Lowena House
Glenthorne Court
Truro Business Park
Truro
Cornwall
TR4 9NY

Auditors

PKF Francis Clark
Statutory Auditor
Lowin House
Tregolls Road
Truro
Cornwall
TR1 2NA

 

SWIG Finance Limited

Balance Sheet

31 March 2023

Note

2023
£

2022
£

Fixed assets

 

Intangible assets

4

49,270

23,760

Tangible assets

5

5,980

7,026

Other financial assets

6

14,000

14,000

 

69,250

44,786

Current assets

 

Debtors

7

212,654

159,902

Investments

8

8,904,910

6,106,682

Cash at bank and in hand

 

2,163,108

3,403,296

 

11,280,672

9,669,880

Creditors: Amounts falling due within one year

9

(1,211,958)

(104,374)

Net current assets

 

10,068,714

9,565,506

Total assets less current liabilities

 

10,137,964

9,610,292

Creditors: Amounts falling due after more than one year

9

(7,501,091)

(7,050,000)

Net assets

 

2,636,873

2,560,292

Capital and reserves

 

Called up share capital

10

2,684,425

2,684,425

Profit and loss account

(47,552)

(124,133)

Shareholders' funds

 

2,636,873

2,560,292

These financial statements have been prepared and delivered in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

Approved and authorised by the Board on 27 October 2023 and signed on its behalf by:
 

.........................................
J Peters
Director

   
     

Company Registration Number: 02688108

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office, which is the same as its principal place of business, is:

Lowena House
Glenthorne Court
Truro Business Park
Truro
Cornwall
TR4 9NY

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.

Basis of preparation

These financial statements have been prepared using the historical cost convention.

The preparation of financial statements in conformity with FRS102 requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company's accounting policies. The areas involving a higher degree of judgement or complexity, or where assumptions and estimates are significant to the financial statements are outlined within this note.

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

Going Concern

The company has performed well in 22/23 and the outlook for operations in 23/24 remains positive. There is strong demand across our sector for affordable loan facilities despite the macro-economic headwinds of inflation and interest rates being higher than we have experienced in recent years. In preparing and approving these financial statements the directors have given due consideration to all economic factors that can impact our business model.

The company has strong net assets, £2,637k (2022 - £2,560k), and trades profitably £77k (2022 - £84k). Our lending capacity outlook gives cause for optimism that our budgets and plans will be achieved. During 23/24 we will have access to new lending facilities from the British Business Bank which underpins the anticipated financial performance and further diversifies the portfolio of lending sources.

The company utilises Government-backed loan guarantee schemes and will ensure a continued focus on our loan portfolios to ensure losses are minimised as far as possible. We recognise the present economic situation is challenging but we remain optimistic that loan-losses will be within anticipated and risk-mitigated criteria.

The Board considers it is appropriate for the accounts to be prepared on a going concern basis for the reasons set out above and especially given the Company’s strong balance sheet and cash reserves outlined which provides sufficient headroom to deal with any potential loan write offs that may occur in the next 12 months from the date of approval of the financial statements.

Revenue recognition

Turnover represents amounts chargeable, net of value added tax, in respect of the provision of services to its customers.

Revenue is recognised on an accruals basis in line with when a contractual right to that income exists.

Tax

Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current corporation 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 operates and generates taxable income.

Deferred tax is recognised on all timing differences at the balance sheet date unless indicated below.

Timing differences are differences between taxable profits and the results as stated in the profit and loss account and other comprehensive income. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Fixtures and fittings

15% per annum

Computer equipment

33% per annum

Intangible assets

Separately acquired project costs are shown at historical cost.

Project costs have a finite useful life and are carried at cost less accumulated amortisation and any accumulated impairment losses.

Software costs are shown at historical cost.

Software costs have a finite useful life and are carried at cost less accumulated amortisation and any accumulated impairment losses.

Project costs

Project costs capitalised as intangible assets under FRS 102 relate to development costs for new loan funds launched in 2018.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life.

The board reviewed the useful life of these projects, and this was estimated to be in the range of one to three years.

Amortisation has been charged as follows:

Asset class

Amortisation method and rate

Project costs

33% - 100% per annum

Software costs

33% per annum

Investments

Investments are carried at cost less provision for impairment.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

Loans and loan provisioning

Loan balances are reviewed regularly and those that are no longer considered to be recoverable are written off.

Where there is any doubt about the recoverability of a loan, an assessment is made of the amount that is considered to be at risk, and of the probability that a default will occur in order to arrive at a provision for doubtful debts.

Loan receivable provisions are made in the profit and loss account where there is objective evidence of an event giving rise to impairment under an incurred loss model (rather than an expected loss model whereby the basis is that a loss may occur in future) in accordance with FRS 102 11.21 to 23.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

Accounting estimates and judgements

In applying the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The areas where management have made significant judgements are as follows

Recognition of deferred tax asset
The financial statements recognise a deferred tax asset of £57k (2022 - £Nil).

In considering the ability to recognise a deferred tax asset management have considered the expected trading and taxable profits based on forecasts. As at 31st March 2023 there is a deferred tax asset of £57k (2022: £116k) which management have elected not to recognise in the financial statements.

Investments loan provision

The financial statements recognise an investment loan provision increase of £118k (2022 - £74k) which is expected to be recovered through the EFG, CBILS and RLS protection, which provides 75% - 80% cover on bad loans providing certain conditions are met.

Provisions against loans receivable are recognised when management judge there is sufficient objective evidence of an impairment event as at the balance sheet date. There are £192k of loans valued as at 31 March 2023 across 22 recipients (of a total loan book of 174) that are on either full or capital repayment holidays at the time of signing the accounts. These are unprovided and may require further provision going forward, although additional provision is not considered appropriate at this time.

 

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

Financial instruments

The company holds the following financial instruments:

• Short term trade and other debtors and creditors;
• Cash and bank balances.

All financial instruments are classified as basic.

The company has chosen to apply the recognition and measurement principles in FRS102.

Financial instruments are recognised when the company becomes party to the contractual provisions of the instrument and derecognised when in the case of assets, the contractual rights to cash flows from the assets expire or substantially all the risks and rewards of ownership are transferred to another party, or in the case of liabilities, when the company’s obligations are discharged, expire or are cancelled.

Such instruments are initially measured at transaction price, including transaction costs, and are subsequently carried at the undiscounted amount of the cash or other consideration expected to be paid or received, after taking account of impairment adjustments.

3

Staff numbers

The average number of persons employed by the company (including directors) during the year, was 24 (2022 - 26).

4

Intangible assets

Project costs
£

Software costs
 £

Total
£

Cost or valuation

At 1 April 2022

53,376

23,760

77,136

Additions

28,125

24,562

52,687

At 31 March 2023

81,501

48,322

129,823

Amortisation

At 1 April 2022

53,376

-

53,376

Amortisation charge

17,781

9,396

27,177

At 31 March 2023

71,157

9,396

80,553

Carrying amount

At 31 March 2023

10,344

38,926

49,270

At 31 March 2022

-

23,760

23,760

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

5

Tangible assets

Furniture, fittings and equipment
 £

Total
£

Cost or valuation

At 1 April 2022

39,486

39,486

Additions

2,985

2,985

At 31 March 2023

42,471

42,471

Depreciation

At 1 April 2022

32,460

32,460

Charge for the year

4,031

4,031

At 31 March 2023

36,491

36,491

Carrying amount

At 31 March 2023

5,980

5,980

At 31 March 2022

7,026

7,026

6

Other financial assets

Other investments
£

Total
£

Non-current financial assets

Cost or valuation

At 1 April 2022

14,000

14,000

At 31 March 2023

14,000

14,000

Carrying amount

At 31 March 2023

14,000

14,000

At 31 March 2022

14,000

14,000

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

7

Debtors

2023
 £

2022
 £

Trade debtors

44,183

97,746

Amounts due from group undertakings

42,891

-

Deferred tax asset

56,726

-

Prepayments

68,854

62,156

212,654

159,902

8

Investments

Investments
£

Total
£

Cost or valuation

At 1 April 2022

6,180,736

6,180,736

Additions

5,247,714

5,247,714

Repaid in the year

(2,331,840)

(2,331,840)

At 31 March 2023

9,096,610

9,096,610

Impairment

At 1 April 2022

74,054

74,054

Provision movement in the year

117,646

117,646

At 31 March 2023

191,700

191,700

Carrying amount

At 31 March 2023

8,904,910

8,904,910

At 31 March 2022

6,106,682

6,106,682

Of the total investment loans above, £6,087,150 (2022 - £4,342,533) is recoverable in more than one year.

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

9

Creditors

Creditors: amounts falling due within one year

Note

2023
 £

2022
£

Due within one year

 

Loans and borrowings

15

1,110,111

-

Trade creditors

 

25,871

30,897

Amounts due to group undertakings

-

36,466

Social security and other taxes

 

17,740

15,422

Outstanding defined contribution pension costs

 

2,636

2,289

Other creditors

 

55,600

19,300

 

1,211,958

104,374

Due after one year

 

Loans and borrowings

15

7,501,091

7,050,000

10

Share capital

Allotted, called up and fully paid shares

 

2023

2022

 

No.

£

No.

£

Ordinary shares of £1 each

2,684,425

2,684,425

2,684,425

2,684,425

         

During the year the company issued share capital of £nil (2022 - £nil).

11

Financial commitments, guarantees and contingencies

Amounts not provided for in the balance sheet

The total amount of financial commitments not included in the balance sheet is £Nil (2022 - £98,033).

At the year end the company was committed to pay £Nil (2022 - £20,000) as the remaining balance on software costs. The remaining commitment is in relation to operating leases.

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

12

Leasing

Operating lease commitments
The company is a lessee of the property from which it operates.

The company has also entered into an agreement with a third party under which it is entitled to receive a total of £15,404 (2022 - £26,604) from the balance sheet date to the 16th August 2024. £11,200 (2022- £11,200) is due within one year of the balance sheet date.

13

Parent and ultimate parent undertaking

The company's immediate parent is South West Investment Group Limited, incorporated in England and Wales. The registered office of this company is Lowena House, Glenthorne Court, Truro Business Park, Truro, Cornwall, TR4 9NY.

 The most senior parent entity producing publicly available financial statements is South West Investment Group Limited. These financial statements are available upon request from Companies House, Crown Way, Cardiff, CF14 3UZ.

14

Audit report

The Independent Auditors' Report was unqualified. The name of the Senior Statutory Auditor who signed the audit report was Duncan Leslie ACA, who signed for and on behalf of PKF Francis Clark on 24 November 2023.

15

Loans and borrowings

2023
£

2022
£

Loans and borrowings due after one year

Bank borrowings

7,501,091

7,050,000

 

SWIG Finance Limited

Notes to the Financial Statements

Year Ended 31 March 2023

2023
£

2022
£

Current loans and borrowings

Bank borrowings

1,110,111

-

The balance above is made up of five loans.

The first bank loan are denominated in pounds sterling, £, with a nominal interest rate of 5.25%, and the final instalment is due on 17 August 2023. The carrying amount at year end is £150,000 (2022 - £500,000).

The second bank loan are denominated in pounds sterling, £, with a nominal interest rate of 5.25%, and the final instalment is due on 8 August 2024. The carrying amount at year end is £950,000 (2022 - £1,900,000).

The third bank loan are denominated in pounds sterling, £, with a nominal interest rate of 5.25%, and the final instalment is due on 15 September 2025. The carrying amount at year end is £900,000 (2022 - £900,000).

The fourth bank loan are denominated in pounds sterling, £, with a nominal interest rate of 8.75%, and the final instalment is due on 28 June 2027. The carrying amount at year end is £3,513,591 (2022 - £3,750,000).

The fifth bank loan are denominated in pounds sterling, £, with a nominal interest rate of 8.15%, and the final instalment is due on 16 Novemeber 2028. The carrying amount at year end is £2,137,500 (2022 - £Nil).

The loans are secured over all assets of the company and also include a 'negative pledge' clause preventing the company offering security over any assets to other lenders or creditors.