Company registration number 01916825 (England and Wales)
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
COMPANY INFORMATION
Directors
Prof T S Barker
Mr R G Lewney
Mr A J Barker
Mr B C Gardiner
Mr P A Hildreth
Mr P T Summerton
Mr J H Stenning
(Appointed 24 October 2022)
Mr Z C Thoung
(Appointed 24 October 2022)
Company number
01916825
Registered office
19A Covent Garden
Cambridge
CB1 2HT
Auditor
Ensors Accountants LLP
Victory House
Vision Park
Chivers Way, Histon
Cambridge
CB24 9ZR
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
CONTENTS
Page
Directors' report
1 - 2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Group balance sheet
8
Company balance sheet
9
Notes to the financial statements
12 - 22
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -

The directors present their annual report and financial statements for the year ended 30 June 2023.

Principal activities

The principal activity of the company and group continued to be the provision of economic consultancy and forecasting services.

Directors

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

Prof T S Barker
Mr R G Lewney
Mr A J Barker
Mr B C Gardiner
Miss R A Beaven
(Resigned 30 June 2023)
Mr P A Hildreth
Mr P T Summerton
Mr J H Stenning
(Appointed 24 October 2022)
Mr Z C Thoung
(Appointed 24 October 2022)
Results and dividends

Ordinary dividends totalling £23,415 were paid during the year. Post year end, ordinary dividends totalling £46,109 was proposed.

Charitable donations

Charitable donations include £47,991 (2022 - £24,585) to the company's parent undertaking, the Cambridge Trust for New Thinking in Economics. Other charitable donations were to various local and national charities.

Auditor

In accordance with the company's articles, a resolution proposing that Ensors Accountants LLP be reappointed as auditor of the group will be put at a General Meeting.

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 auditor of the company 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 auditor of the company is aware of that information.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
CEO's Annual Summary 2022/23

 

In 2022/23 we appointed two new directors: Jon Stenning, who leads our growing Environment team, and Chris Thoung who leads our Society team, covering both social policy and place-based economic development. Their appointments have been critical to the success of the company reflected in these accounts.

At the end of the financial year, Rachel Beaven, retired from Cambridge Econometrics after 30 years of service. Rachel started her career with Cambridge Econometrics as an intern and returned to the company after graduating from the University of Bath. In the mid 2000’s, Rachel was appointed as a director of the company and from 2017 was instrumental in the growth and success of the company serving as our HR director.

I would like to thank Rachel for her impact on the company, for her advice and mentorship to me personally, and for championing the importance of our people in our company strategy.

Overall, the accounts presented here reflect the strong performance of the company in 2022/23 which was one of our most successful years ever for growth and for profitability. As a result, not only were we able to retain profit to reinvest in the growth of the business, but we were also able to share our profits with our staff, directors, owners and the charitable trust that retains a majority stake in our business – The Cambridge Trust for New Economic Thinking.

Looking ahead, the foundations of the business are strong. We have an exceptional team of senior staff that are capable of delivering a wide range of economic research and consultancy services. The models and the data behind the models used in our consultancy services have been further developed to remain relevant and provide state of the art insights that are helping decision-makers both in public policy and now, private strategic investors. Moreover, we continue to invest in our business support services (marketing, communications, operations, IT and HR) to provide the highest quality professional services to our staff, clients, and partners.

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.

On behalf of the board
Mr P T Summerton
CEO (Chief Executive Officer)
29 February 2024
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -

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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
- 4 -
Opinion

We have audited the financial statements of Cambridge Econometrics Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 June 2023 which comprise the group profit and loss account, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company 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 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:

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 group and parent 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 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 and 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.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's 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.

Opinions on other matters prescribed by the Companies Act 2006

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

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and parent company and their 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, 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 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 parent 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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

 

 

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
- 6 -

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.

Jayson Lawson (Senior Statutory Auditor)
For and on behalf of Ensors Accountants LLP
29 February 2024
Chartered Accountants
Statutory Auditor
Victory House
Vision Park
Chivers Way, Histon
Cambridge
CB24 9ZR
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2023
- 7 -
2023
2022
Notes
£
£
Turnover
5,161,244
4,034,679
Cost of sales
(3,221,495)
(2,859,318)
Gross profit
1,939,749
1,175,361
Administrative expenses
(1,446,632)
(1,060,026)
Other operating income
32,419
1,431
Operating profit
525,536
116,766
Interest receivable and similar income
-
0
1
Interest payable and similar expenses
(1,343)
(833)
Profit before taxation
524,193
115,934
Tax on profit
(80,709)
(8,274)
Profit for the financial year
443,484
107,660
Profit for the financial year is all attributable to the owners of the parent company.
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
GROUP BALANCE SHEET
AS AT
30 JUNE 2023
30 June 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
5
-
-
Tangible assets
6
95,992
99,073
Current assets
Debtors
9
2,072,886
2,057,975
Cash at bank and in hand
1,040,557
583,942
3,113,443
2,641,917
Creditors: amounts falling due within one year
10
(995,709)
(937,935)
Net current assets
2,117,734
1,703,982
Total assets less current liabilities
2,213,726
1,803,055
Creditors: amounts falling due after more than one year
11
(24,938)
(34,336)
Net assets
2,188,788
1,768,719
Capital and reserves
Called up share capital
17,630
17,630
Profit and loss reserves
2,171,158
1,751,089
Total equity
2,188,788
1,768,719

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

The financial statements were approved by the board of directors and authorised for issue on 29 February 2024 and are signed on its behalf by:
29 February 2024
Mr P T Summerton
Director
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
COMPANY BALANCE SHEET
AS AT 30 JUNE 2023
30 June 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
6
87,207
91,223
Investments
7
167,804
167,804
255,011
259,027
Current assets
Debtors
9
1,520,727
1,622,846
Cash at bank and in hand
584,395
204,243
2,105,122
1,827,089
Creditors: amounts falling due within one year
10
(779,981)
(721,704)
Net current assets
1,325,141
1,105,385
Total assets less current liabilities
1,580,152
1,364,412
Creditors: amounts falling due after more than one year
11
(24,938)
(34,336)
Net assets
1,555,214
1,330,076
Capital and reserves
Called up share capital
17,630
17,630
Profit and loss reserves
1,537,584
1,312,446
Total equity
1,555,214
1,330,076

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £248,553 (2022 - £18,776 loss).

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

The financial statements were approved by the board of directors and authorised for issue on 29 February 2024 and are signed on its behalf by:
29 February 2024
Mr P T Summerton
Director
Company registration number 01916825 (England and Wales)
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 July 2021
17,630
1,643,429
1,661,059
Year ended 30 June 2022:
Profit and total comprehensive income
-
107,660
107,660
Balance at 30 June 2022
17,630
1,751,089
1,768,719
Year ended 30 June 2023:
Profit and total comprehensive income
-
443,484
443,484
Dividends
-
(23,415)
(23,415)
Balance at 30 June 2023
17,630
2,171,158
2,188,788
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 July 2021
17,630
1,331,222
1,348,852
Year ended 30 June 2022:
Loss and total comprehensive income for the year
-
(18,776)
(18,776)
Balance at 30 June 2022
17,630
1,312,446
1,330,076
Year ended 30 June 2023:
Profit and total comprehensive income
-
248,553
248,553
Dividends
-
(23,415)
(23,415)
Balance at 30 June 2023
17,630
1,537,584
1,555,214
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 12 -
1
Accounting policies
Company information

Cambridge Econometrics Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 19A Covent Garden, Cambridge, CB1 2HT.

 

The group consists of Cambridge Econometrics Limited and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

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 under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Cambridge Econometrics Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 June 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 13 -

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

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

1.5
Turnover

Turnover represents the fair value of consideration received or receivable, exclusive of Value Added Tax, in respect of the following three sources:

 

Project revenue is recorded using a percentage of completion method, which results in deferred revenue on the balance sheet when services are invoiced in advance of the revenue being earned, and accrued revenue on the balance sheet when revenue is earned prior to invoicing the customer. The directors estimate the percentage of completion at the year end for each project using the best available evidence. Profit is recognised on the same basis as revenue.

 

Subscription revenue is recognised over the period that the subscription covers, which results in deferred revenue on the balance sheet, as subscriptions are invoiced in advance of the revenue being earned. Profit is recognised on the same basis as revenue.

 

Other revenue, such as consultancy and training, and resulting profit, is recognised when the service is performed.

1.6
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

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

Software
33% Straight line
1.7
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.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 14 -

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 land and buildings
15% straight line
Plant and equipment
20% straight line
Fixtures and fittings
10% straight line
Computers
20% straight line

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.

1.8
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.9
Impairment of fixed assets

At each reporting period end date, the group 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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 15 -

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.10
Cash and cash equivalents

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

1.11
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

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.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 16 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, 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 have been affected. 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 profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 17 -
Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.12
Equity instruments

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

1.13
Taxation

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

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

 

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

1.14
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

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

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.15
Retirement benefits

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

1.16
Leases

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

CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 18 -
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.

2
Judgements and key sources of estimation uncertainty

In the application of the group’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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
23,000
14,400
4
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Total
58
56
41
42
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 19 -
5
Intangible fixed assets
Group
Software
£
Cost
At 1 July 2022 and 30 June 2023
2,150
Amortisation and impairment
At 1 July 2022 and 30 June 2023
2,150
Carrying amount
At 30 June 2023
-
0
At 30 June 2022
-
0
The company had no intangible fixed assets at 30 June 2023 or 30 June 2022.
6
Tangible fixed assets
Group
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 July 2022
76,936
375,370
452,306
Additions
5,368
25,918
31,286
Disposals
-
0
(27,032)
(27,032)
At 30 June 2023
82,304
374,256
456,560
Depreciation and impairment
At 1 July 2022
50,187
303,046
353,233
Depreciation charged in the year
8,014
25,856
33,870
Eliminated in respect of disposals
-
0
(26,535)
(26,535)
At 30 June 2023
58,201
302,367
360,568
Carrying amount
At 30 June 2023
24,103
71,889
95,992
At 30 June 2022
26,749
72,324
99,073
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
6
Tangible fixed assets
(Continued)
- 20 -
Company
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 July 2022
76,936
362,467
439,403
Additions
5,368
20,317
25,685
Disposals
-
0
(27,032)
(27,032)
At 30 June 2023
82,304
355,752
438,056
Depreciation and impairment
At 1 July 2022
50,187
297,993
348,180
Depreciation charged in the year
8,014
21,190
29,204
Eliminated in respect of disposals
-
0
(26,535)
(26,535)
At 30 June 2023
58,201
292,648
350,849
Carrying amount
At 30 June 2023
24,103
63,104
87,207
At 30 June 2022
26,749
64,474
91,223
7
Fixed asset investments
Group
Company
2023
2022
2023
2022
£
£
£
£
-
0
-
0
167,804
167,804
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 July 2022 and 30 June 2023
167,804
Carrying amount
At 30 June 2023
167,804
At 30 June 2022
167,804
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 21 -
8
Subsidiaries

Details of the company's subsidiaries at 30 June 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Cambridge Econometrics Hungary Kft
1025 Budapest, Pusztaszeri út 36
Ordinary shares
100.00
Cambridge Econometrics (Belgium) BVBA
Mechelsesteenweg 131, 2640 Mortsel
Ordinary shares
99.00
Cambridge Econometrics Inc
9 1/2 Market St, Northampton, MA
Ordinary shares
100.00
9
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
677,340
1,108,200
352,310
686,859
Other debtors
36,314
19,730
82,711
130,023
Prepayments and accrued income
1,347,607
910,148
1,074,081
786,067
2,061,261
2,038,078
1,509,102
1,602,949
Deferred tax asset
11,625
19,897
11,625
19,897
2,072,886
2,057,975
1,520,727
1,622,846
10
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans and overdrafts
10,244
10,236
9,398
9,398
Trade creditors
101,230
84,789
39,245
63,422
Corporation tax payable
11,189
40,538
10,674
-
0
Other taxation and social security
139,133
83,685
89,581
76,176
Other creditors
56,389
32,365
115,859
92,914
Accruals and deferred income
677,524
686,322
515,224
479,794
995,709
937,935
779,981
721,704
11
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans and overdrafts
24,938
34,336
24,938
34,336
24,938
34,336
24,938
34,336
CAMBRIDGE ECONOMETRICS LTD AND SUBSIDIARIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 22 -
12
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
34,336
43,734
34,336
43,734
Bank overdrafts
846
838
-
0
-
0
35,182
44,572
34,336
43,734
Payable within one year
10,244
10,236
9,398
9,398
Payable after one year
24,938
34,336
24,938
34,336

The bank loan is secured by a fixed and floating charge over the assets of the UK company.

13
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
249,088
308,617
218,750
293,750
14
Related party transactions

The company has taken advantage of the exemption available under FRS 102 1A not to disclose details of transactions with other group undertakings.

 

During the year the company paid rent of £75,000 (2022 - £65,650) to Cambridge Econometrics Investment Fund of which Professor T S Barker, Mr R G Lewney, Mr B C Gardiner, Mr A J Barker, Miss R A Beaven, Mr H B Pollitt and Mr P T Summerton are trustees and beneficiaries.

 

The company voted a donation to the Cambridge Trust for New Thinking in Economics of £47,991 (2022 - £24,585). At the year end £47,991 (2022 - £24,585) was owing to the Cambridge Trust for New Thinking in Economics.

 

Dividends totalling £23,415 were paid to shareholders in the year (2022: £Nil).

15
Controlling party

The ultimate controlling party is the Cambridge Trust for New Thinking in Economics, which owns 51% of the voting shares. Professor T S Barker and Mr R G Lewney are Trustees together with Mr DMF Taylor, Professor P Arestis, Dr A Anger-Kraavi, Dr N Barker and Dr C Alves. Professor T S Barker is Chairman of the Trust and also owns 45% of the ordinary (voting) shares of Cambridge Econometrics Limited, The Trust is a charity registered in the UK and prepares group accounts which are available from the Charity Commission, Redgrave Court, Merton Road, Merseyside L20 7HS.

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