Company Registration No. 10697809 (England and Wales)
IMMOTION VR LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
IMMOTION VR LIMITED
COMPANY INFORMATION
Directors
Mr J J Collis
(Appointed 28 February 2023)
Mr R D Findley
(Appointed 28 February 2023)
Company number
10697809
Registered office
Kingswood House
South Road
Kingswood
Bristol
BS15 8JF
Auditor
Haysmacintyre LLP
10 Queen Street Place
London
EC4R 1AG
IMMOTION VR LIMITED
CONTENTS
Page
Directors' report
1 - 2
Independent auditor's report
3 - 5
Statement of comprehensive income
6
Statement of financial position
7
Statement of changes in equity
8
Notes to the financial statements
9 - 23
IMMOTION VR LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

The directors present their annual report and financial statements for the year ended 31 December 2022.

The principal activity of the company continued to be that of the operation of virtual reality experiences at its own ImmotionVR locations and at partner sites.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr M J Higginson
(Resigned 28 February 2023)
Mr D F G Wortley
(Resigned 28 February 2023)
Mr J J Collis
(Appointed 28 February 2023)
Mr R D Findley
(Appointed 28 February 2023)
Auditor
The auditors, Haysmacintyre LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
Statement of directors' responsibilities

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for ensuring that the company keeps or causes to be kept adequate accounting records which correctly explain and record the transactions of the company, enable at any time the assets, liabilities, financial position and profit or loss of the company to be determined with reasonable accuracy, enable them to ensure that the financial statements and annual report comply with the Companies Act 2006 and enable the financial statements to be audited. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

IMMOTION VR LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the Company’s auditor is aware of that information.

Small companies note
In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.
On behalf of the board
Mr R D Findley
Director
21 December 2023
IMMOTION VR LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF IMMOTION VR LIMITED
- 3 -
Opinion

We have audited the financial statements of Immotion VR Limited (the 'company') for the year ended 31 December 2022 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 101 ‘Reduced Disclosure Framework’ (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

 

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

 

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 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.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

IMMOTION VR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IMMOTION VR LIMITED
- 4 -

Opinions on other matters prescribed by the Companies Act 2006

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

 

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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:

Responsibilities of directors

As explained more fully in the directors’ responsibilities statement set out on page 1, 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 Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s 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 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:

IMMOTION VR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IMMOTION VR LIMITED
- 5 -

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Based on our understanding of the company and industry, we have identified the principal risks of noncompliance with laws and regulations, and we have considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, income tax, payroll tax and sales tax.

 

We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to revenue and management bias in accounting estimates. Audit procedures performed by the engagement team included:

 

 

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.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's 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.

Christopher Cork (Senior Statutory Auditor)
For and on behalf of Haysmacintyre LLP
Chartered Accountants
Statutory Auditor
10 Queen Street Place
London
EC4R 1AG
22 December 2023
IMMOTION VR LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 6 -
2022
2021
Notes
£
£
Revenue
3
2,722,219
1,801,952
Cost of sales
(1,762,625)
(1,289,961)
Gross profit
959,594
511,991
Administrative expenses
(1,907,764)
(1,284,859)
Other operating income
4
42,138
188,439
Operating loss
5
(906,032)
(584,429)
Interest payable and similar expenses
9
(897)
(1,409)
Loss before taxation
(906,929)
(585,838)
Tax on loss
10
12,722
5,087
Loss and total comprehensive income for the financial year
(894,207)
(580,751)

The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.

 

There was no other comprehensive income for 2022 (2021: £NIL).

 

The notes on pages 9 to 23 form part of these financial statements.

IMMOTION VR LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2022
31 December 2022
- 7 -
2022
2021
Notes
£
£
£
£
Fixed assets
Intangible assets
12
4,409
11,390
Property, plant and equipment
13
270,694
288,169
275,103
299,559
Current assets
Trade and other receivables
14
1,066,638
1,560,539
Cash and cash equivalents
16
45,396
199,890
1,112,034
1,760,429
Current liabilities
16
(7,267,647)
(7,041,668)
Net current liabilities
(6,155,613)
(5,281,239)
Total assets less current liabilities
(5,880,510)
(4,981,680)
Non-current liabilities
16
-
0
(4,623)
Net liabilities
(5,880,510)
(4,986,303)
Capital and reserves
Called up share capital
20
2
2
Share premium account
21
449,998
449,998
Profit and loss reserves
21
(6,330,510)
(5,436,303)
Total equity
(5,880,510)
(4,986,303)
The financial statements were approved by the board of directors and authorised for issue on 21 December 2023 and are signed on its behalf by:
Mr R D Findley
Director
Company Registration No. 10697809
The notes on pages 9 to 23 form part of these financial statements.
IMMOTION VR LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2021
2
449,998
(4,855,552)
(4,405,552)
Year ended 31 December 2021:
Loss and total comprehensive income for the year
-
-
(580,751)
(580,751)
Balance at 31 December 2021
2
449,998
(5,436,303)
(4,986,303)
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
-
(894,207)
(894,207)
Balance at 31 December 2022
2
449,998
(6,330,510)
(5,880,510)
The notes on pages 9 to 23 form part of these financial statements.
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
1
Accounting policies
Company information

Immotion VR Limited is a private company limited by shares incorporated in England and Wales. The registered office is Kingswood House, South Road, Kingswood, Bristol, BS15 8JF. The company's principal activities and nature of its operations are disclosed in the directors' report.

1.1
Accounting convention

The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS101) and the Companies Act 2006.

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

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

As permitted by FRS 101, the company has taken advantage of the following disclosure exemptions from the requirements of IFRS:

 

1.2
Going concern

The directors have at the time of approving the financial statements, a reasonable expectation that the company has adequate resources and support from its parent company to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

1.3
Revenue

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 company does not expect to have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence the company does not adjust any of the transaction prices for the time value of money.

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 10 -

Revenue from providing services is recognised in the accounting period in which the services are rendered.

 

For fixed-price contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided because the customer receives and uses the benefits simultaneously.

 

Revenue from services rendered in ImmotionVR locations are recognised on the date which the sale to the customer takes place.

 

Partnership revenue is recognised on the date which the sale to the customer takes place. Immotion VR Limited acts as the principal in the transaction and therefore recognises the revenue charged to the end user in full with the partners' shares deducted as a cost of sale.

1.4
Intangible assets other than goodwill

Intangible assets are recognised at cost and are subsequently measured at cost less accumulated amortisation and impairment losses.

 

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

 

Domain names                33% straight line

Website                    33% straight line

Software development            33% straight line

1.5
Tangible fixed assets

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

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

Leasehold improvements
33% straight line
Fixtures and fittings
33% straight line
Plant and equipment
33% straight line
IT equipment & VR hardware
14% or 33% straight line
Right of use assets
Over the terms of the leases

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

1.6
Borrowing costs related to fixed assets

All borrowing costs are recognised in the Statement of Comprehensive Income in the year in which they are incurred.

1.7
Impairment of tangible and intangible assets

At each reporting end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 11 -
1.8
Cash and cash equivalents

Cash and cash equivalents include cash in hand and deposits held at call with banks.

1.9
Financial assets

Financial assets are recognised in the company's Statement of Financial Position when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

 

At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been affected.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

1.10
Financial liabilities

The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.

Other financial liabilities

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.

1.11
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs.

1.12
Taxation

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

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 12 -
Current tax

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

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

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

1.13
Employee benefits

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

 

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

1.14
Retirement benefits

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 the 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 company in independently administered funds.

1.15
Leases

At inception, the company assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the company recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within tangible fixed assets, apart from those that meet the definition of investment property.

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 13 -

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.

 

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other tangible fixed assets. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the company's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the company is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the company's estimate of the amount expected to be payable under a residual value guarantee; or the company's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.

1.16
Grants

The company recognises government grants (including local authority grants) when it has reasonable assurance that it will comply with the relevant conditions and the grant will be received.

 

Grants related to income are recognised in the profit and loss account in line with the recognition of the expenses that the grants are intended to compensate. Such grants are presented as income and are not deducted from the related expenditure.

1.17
Foreign exchange

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

1.18

Finance costs

Finance costs are charged to the 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.

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 14 -
1.19

Receivables

Short term receivables 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.

1.20

Payables

Payables are obligations to pay for goods or services that have been acquired in the ordinary course of business, from suppliers.

 

Payables are recognised initially at fair value and subsequently at amortised cost using the effective interest method.

2
Critical accounting estimates and judgements

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount 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 estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.

Critical judgements
Depreciation

The useful economic lives of tangible fixed assets are based on management's judgement and experience. When management identifies that actual useful economic lives differ materially from the estimates used to calculate depreciation, that charge is adjusted retrospectively. Due to the significance of tangible fixed assets to the company, variances between actual and estimated useful economic lives could impact in the operating results both positively and negatively, although historically few changes to estimated useful economic lives have been required.

Amortisation of intangible assets

The periods of amortisation adopted to write down capitalised intangibles and capitalised staff costs require judgements to be made in respect of estimating the useful economic lives of the intangible assets to determine an appropriate amortisation rate.

 

Intangible assets are amortised on a straight line basis over the period during which economic benefits are expected to be received.

Management charges

Management charges incurred are charged to the company by the parent in relation to the benefits the company has received due to the group becoming listed on AIM. Costs attributable to consultancy services provided to the subsidiaries are also included within the management charge on a proportional basis of total subsidiary external revenues.

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
2
Critical accounting estimates and judgements
(Continued)
- 15 -
Content licensing charges

Content licensing charges are incurred with the group company that develops content used in the company's equipment. The allocation of the charges to the group companies making use of such content is on the basis of total subsidiary external revenues.

IFRS 16 discount rates

The group estimates an appropriate discount rate based on an incremental rate of borrowing for the calculation of the IFRS 16 right-of-use assets. This requires judgement as to an appropriate discount rate.

 

3
Revenue
2022
2021
£
£
Revenue analysed by class of business
ImmotionVR
787,758
593,194
Partnerships
1,934,461
966,772
Hardware
-
241,986
2,722,219
1,801,952
2022
2021
£
£
Revenue analysed by geographical market
United Kingdom
2,127,213
1,414,000
Rest of Europe
73,431
78,369
Rest of the world
521,575
309,583
2,722,219
1,801,952
4
Other operating income

Amounts receivable under the UK Government Coronavirus Job Retention Scheme £nil (2021: £145,960).

 

The company received local authority Coronavirus Relief grants of £6,000 (2021: £42,479).

 

The company also received insurance claims of £36,138 (2021: £nil).

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 16 -
5
Operating loss
2022
2021
£
£
Operating loss for the year is stated after charging:
Exchange (gains)/losses
(2,507)
827
Defined contribution pension cost
11,969
10,613
Depreciation of property, plant and equipment
222,510
542,970
Profit on disposal of tangible fixed assets
(19,358)
(18,377)
Impairment of tangible fixed assets
-
1,441
Operating lease costs
146,863
124,157
Amortisation of intangible assets
6,981
14,981
Provision against debts due from group undertakings
767,878
-
0
6
Auditor's remuneration

Auditors' remuneration in respect of the Company - £14,300 (2021: £13,000).

7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2022
2021
Number
Number
Directors
2
2
Management and administration
3
3
ImmotionVR
34
31
Operations
3
3
Sales and marketing
2
3
Total
44
42

Their aggregate remuneration comprised:

2022
2021
£
£
Wages and salaries
873,650
702,471
Social security costs
73,580
50,006
Pension costs
11,969
10,613
959,199
763,090
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 17 -
8
Directors' remuneration

The directors received remuneration of £Nil in the year (2021 - £Nil). The directors were remunerated via Let's Explore Group Plc, which charged the company a management fee inclusive of an appropriate proportion of the directors' remuneration.

 

Key management personnel received remuneration of £Nil (2021: £Nil) in the period.

9
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
HMRC interest
330
181
Interest on other financial liabilities:
Interest on lease liabilities
567
1,228
Total interest expense
897
1,409
10
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
(12,722)
(5,087)

The charge for the year can be reconciled to the loss per the profit and loss account as follows:

2022
2021
£
£
Loss before taxation
(906,929)
(585,838)
Expected tax credit based on a corporation tax rate of 19.00% (2021: 19.00%)
(172,317)
(111,309)
Income not taxable
(11,309)
-
0
Group relief
3,235
-
0
Under/(over) provided in prior years
(12,722)
-
Expenses not deductible for tax purposes
144,710
-
Depreciation in excess of capital allowances
2,387
64,822
R&D tax credit
-
(5,087)
Deferred tax not provided for on losses
33,294
46,487
Taxation credit for the year
(12,722)
(5,087)
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
10
Taxation
(Continued)
- 18 -

The UK Finance Act 2021 received royal assent on 10 June 2021. This legislation maintained the UK corporation tax rate at the same level as in the year commencing 1 April 2020 at 19% for the years commencing 1 April 2021 and 1 April 2022 increasing the rate to 25% in the year commencing 1 April 2023. Deferred taxes at the reporting date have been measured using these enacted tax rates.

 

There were unused tax losses of £5,066,240 at 31 December 2022 (£4,791,382 at 31 December 2021). No deferred tax asset has been recognised due to the uncertainty surrounding future profits.

11
Impairments

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

2022
2021
£
£
In respect of:
Tangible fixed assets
-
1,441
Recognised in:
Administrative expenses
-
1,441
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 19 -
12
Intangible fixed assets
Website
Software development
Domain                             names
Total
£
£
£
£
Cost
At 1 January 2022
6,140
63,628
4,355
74,123
At 31 December 2022
6,140
63,628
4,355
74,123
Amortisation and impairment
At 1 January 2022
841
59,129
2,763
62,733
Charge for the year
2,047
4,499
435
6,981
At 31 December 2022
2,888
63,628
3,198
69,714
Carrying amount
At 31 December 2022
3,252
-
1,157
4,409
At 31 December 2021
5,299
4,499
1,592
11,390
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 20 -
13
Tangible fixed assets
Leasehold improvements
Fixtures and fittings
Plant and equipment
IT equipment & VR hardware
Right of use assets
Total
£
£
£
£
£
£
Cost
At 1 January 2022
241,436
3,148
11,363
1,004,312
25,753
1,286,012
Additions
71,105
-
0
-
0
136,749
-
207,854
Disposals
(9,329)
-
(6,999)
(77,941)
-
0
(94,269)
At 31 December 2022
303,212
3,148
4,364
1,063,120
25,753
1,399,597
Accumulated depreciation and impairment
At 1 January 2022
201,930
2,165
9,368
771,504
12,876
997,843
Charge for the year
39,809
567
1,455
172,095
8,584
222,510
Disposals
(7,633)
-
0
(6,999)
(76,818)
-
0
(91,450)
At 31 December 2022
234,106
2,732
3,824
866,781
21,460
1,128,903
Carrying amount
At 31 December 2022
69,106
416
540
196,339
4,293
270,694
At 31 December 2021
39,506
983
1,995
232,808
12,877
288,169

More information on impairment movements in the year is given in note 11.

The IFRS 16 Right of Use Assets are detailed further below and in note 18.
The net book value of owned and leased assets included in tangible fixed assets in the Statement of Financial Position is as follows:
2022
2021
£
£
Tangible fixed assets owned
266,401
275,292
Right-of-use tangible fixed assets
4,293
12,877
270,694
288,169
Information about right-of-use assets is summarised below:
2022
2021
Net book value
£
£
Property
4,293
12,877
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
13
Tangible fixed assets
(Continued)
- 21 -
2022
2021
Depreciation charge for the year
£
£
Property
8,584
10,802
14
Trade and other receivables
2022
2021
£
£
Trade receivables
121,984
138,425
Corporation tax recoverable
-
5,087
Amounts owed by group undertakings
895,694
1,350,784
Other receivables
7,268
36,622
Prepayments
19,596
11,668
Contract assets
22,096
17,953
1,066,638
1,560,539

 

15
Cash and cash equivalents
2022
2021
£
£
Cash at bank and in hand
45,396
199,890
16
Payables
Due within one year
Due after one year
2022
2021
2022
2021
Notes
£
£
£
£
Trade and other payables
17
7,225,383
6,971,249
-
0
-
0
Taxation and social security
37,641
61,586
-
0
-
0
Lease liabilities
18
4,623
8,833
-
4,623
7,267,647
7,041,668
-
4,623
IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 22 -
17
Trade and other payables
2022
2021
£
£
Trade payables
67,159
58,865
Amounts owed to group undertakings
6,962,732
6,757,610
Accruals
171,344
137,949
Contract liabilities
1,690
4,047
Other payables
22,458
12,778
7,225,383
6,971,249
18
Lease liabilities

Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:

2022
2021
£
£
Current liabilities
4,623
8,833
Non-current liabilities
-
4,623
4,623
13,456
2022
2021
Contractual undiscounted cash flows are due as follows:
£
£
Not later than one year
4,700
9,400
Between one year and five years
-
4,700
4,700
14,100
Expenditure recognised in the profit or loss during the period in respect of short term leases £146,863 (2021: £124,157).
Amounts recognised in profit or loss include interest on lease liabilities of £567 (2021: £1,228).
19
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
11,969
10,613

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

IMMOTION VR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
20
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
2
2
2
2
21
Reserves

Share premium includes any premium received on issues of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.

 

Profit and loss reserves include all current and prior period retained profits and losses.

22
Related party transactions

 

The Company has taken advantage of the exemption provided by FRS 101 from disclosing transactions entered into between group companies.

 

Huddled Group Limited, a company of which D F G Wortley and M J Higginson were directors, during the period charged the company £592 (2021: £Nil) in the period for purchases and recharges. At the reporting date £Nil (2021: £Nil) was owed to Huddled Group Limited.

23
Ultimate Controlling Party
As at 31 December 2022, the immediate parent company and ultimate parent company of Immotion VR Limited was Immotion Group Plc. However, due to the change in control as noted in Note 24, the immediate parent company and ultimate parent company of Immotion VR Limited is LBE BidCo, Inc, a company registered in the USA.
24
Events after the reporting date

On 28 February 2023, the entirety of the company's share capital was acquired by LBE BidCo, Inc, a company registered in the USA.

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