Company registration number 02690113 (England and Wales)
TMC TECHNOLOGY UK CO., LTD.
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
TMC TECHNOLOGY UK CO., LTD.
COMPANY INFORMATION
Directors
S Lin
C Chen
Secretary
S Lin
Company number
02690113
Registered office
12 Wedgwood Court
Stevenage
Herts
SG1 4QR
Auditor
UHY Hacker Young (East) Limited
Suite 501
The Nexus Building
Broadway
Letchworth Garden City
Herts
SG6 9BL
Business address
12 Wedgwood Court
Stevenage
Herts
SG1 4QR
TMC TECHNOLOGY UK CO., LTD.
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 22
TMC TECHNOLOGY UK CO., LTD.
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
The principal activity of the company continued to be that of the sale of computer products.
Fair review of the business
Turnover decreased by 27.7% year on year, although gross margins remained stable, decreasing by just 0.06% when compared to the previous year.
The trading environment in FY23 proved challenging. Core customers had overstocked in FY22 in order to limit the disruptions in their supply chains due to component shortages and volatile material prices, and had then utilised this excess inventory in FY23, resulting in a reduction of the volume and timing of their orders placed. Additionally, geopolitical events such as the conflict in Ukraine contributed to an economic environment where inflation and interest rates were high, which led to uncertainties in business spending, thereby affecting demand for hardware products and impacting sales.
Despite the reduction in turnover for the year, the directors are satisfied with the results of the company and are optimistic with regards to the general market conditions for the coming year.
Principal risks and uncertainties
The principal risks and uncertainties facing the company are reviewed in detail by the directors, and no material additional risk or uncertainty has been identified other than those detailed below.
Competitive risk
The company operates in the computer hardware sector. The markets remain competitive with price and margin fluctuations, which are dependent on relationships with key suppliers. Additionally, uncertainty surrounding the economy due to high interest rates and rising costs remain prominent factors affecting the sector.
Price risk
The company will only enter into a transaction with a customer on the basis of fixed, pre-agreed terms from suppliers and, consequently, is not exposed to price risk.
Currency risk
The company is exposed to foreign exchange risk in connection with its transactions with both its customers and suppliers as the company makes sales and purchases in euros and dollars.
Credit risk
The company’s credit risk is primarily attributable to its trade receivable and other debtors. The company operates a number of policies and procedures designed to mitigate credit risk. In particular, external agencies are consulted when a new customer wishes to open a credit account. In addition, the company has in place insurance policies to cover the risk of default by its customers, as well as ongoing credit limits and collection procedures to manage day to day exposure.
Future prospects and development
The directors do not expect any change in the activities of the company in the foreseeable future.
TMC TECHNOLOGY UK CO., LTD.
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Key performance indicators
The directors of the company use a variety of financial performance indicators to monitor the company’s position.
Among the financial performance indicators, the most important are overall gross profit margin, revenue, total operating profit, and cash at bank.
2023 2022
Gross profit margin 16.4% 16.4%
Revenue £12,098,551 £16,735,132
Total operating profit £754,926 £1,559,311
Cash at bank £6,452,039 £6,054,144
S Lin
Director
12 January 2024
TMC TECHNOLOGY UK CO., LTD.
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of the sale of computer products.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
S Lin
C Chen
Auditor
The auditor, UHY Hacker Young (East) Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
S Lin
Director
12 January 2024
TMC TECHNOLOGY UK CO., LTD.
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. 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.
TMC TECHNOLOGY UK CO., LTD.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF TMC TECHNOLOGY UK CO., LTD.
- 5 -
Opinion
We have audited the financial statements of TMC Technology UK Co., Ltd. (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, 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 Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 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 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.
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:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
TMC TECHNOLOGY UK CO., LTD.
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF TMC TECHNOLOGY UK CO., LTD.
- 6 -
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 strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
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 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.
Based on our understanding of the company and the industry in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to the acts by the company, which were contrary to applicable laws and regulations including fraud, and we 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.
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 manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to revenue recognition and key accounting estimates, namely provisions for stock obsolescence, trade receivables and dilapidations.
Our audit procedures were designed to respond to those identified risks, including non-compliance with laws and regulations (irregularities) and fraud that are material to the financial statements. Our audit procedures included but were not limited to:
Communicating identified laws and regulations throughout our engagement team and remaining alert to any indications of non-compliance throughout our audit; and
Considering the risk of acts by the company which were contrary to the applicable laws and regulations, including fraud; and
Enquiring of management as to actual and potential litigation and claims.
TMC TECHNOLOGY UK CO., LTD.
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF TMC TECHNOLOGY UK CO., LTD.
- 7 -
Our audit procedures in relation to fraud included but were not limited to:
Discussing amongst the engagement team the risks of fraud;
Making enquiries of management on whether they had knowledge of any actual, suspected or alleged fraud; and
Gaining an understanding of the internal controls established to mitigate risks related to fraud; and
Corroborating the basis for material accounting estimates; and
Addressing the risks of fraud through management override of controls by performing substantive and analytical journal testing; and
Obtaining support and reasonable explanation for any manual journal postings.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
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.
This report is made solely to the company's member 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 member 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 member for our audit work, for this report, or for the opinions we have formed.
James Price FCA
Senior Statutory Auditor
For and on behalf of UHY Hacker Young (East) Limited
12 January 2024
Chartered Accountants
Statutory Auditor
Suite 501
The Nexus Building
Broadway
Letchworth Garden City
Herts
SG6 9BL
TMC TECHNOLOGY UK CO., LTD.
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
12,098,551
16,735,132
Cost of sales
(10,119,667)
(13,987,643)
Gross profit
1,978,884
2,747,489
Administrative expenses
(1,223,958)
(1,188,178)
Operating profit
4
754,926
1,559,311
Interest receivable and similar income
7
89,877
7,556
Profit before taxation
844,803
1,566,867
Tax on profit
8
(206,367)
(293,890)
Profit for the financial year
638,436
1,272,977
The profit and loss account has been prepared on the basis that all operations are continuing operations.
TMC TECHNOLOGY UK CO., LTD.
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
£
£
Profit for the year
638,436
1,272,977
Other comprehensive income net of taxation
-
-
Total comprehensive income for the year
638,436
1,272,977
TMC TECHNOLOGY UK CO., LTD.
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
54,834
69,539
Investments
10
7,600
7,600
62,434
77,139
Current assets
Stocks
12
422,423
754,524
Debtors
13
1,467,838
1,458,491
Cash at bank and in hand
6,452,039
6,054,144
8,342,300
8,267,159
Creditors: amounts falling due within one year
14
(1,140,821)
(1,743,821)
Net current assets
7,201,479
6,523,338
Total assets less current liabilities
7,263,913
6,600,477
Provisions for liabilities
Provisions
15
125,000
100,000
(125,000)
(100,000)
Net assets
7,138,913
6,500,477
Capital and reserves
Called up share capital
17
900,000
900,000
Profit and loss reserves
6,238,913
5,600,477
Total equity
7,138,913
6,500,477
The financial statements were approved by the board of directors and authorised for issue on 12 January 2024 and are signed on its behalf by:
S Lin
Director
Company Registration No. 02690113
TMC TECHNOLOGY UK CO., LTD.
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
900,000
4,327,500
5,227,500
Year ended 31 December 2022:
Profit and total comprehensive income
-
1,272,977
1,272,977
Balance at 31 December 2022
900,000
5,600,477
6,500,477
Year ended 31 December 2023:
Profit and total comprehensive income
-
638,436
638,436
Balance at 31 December 2023
900,000
6,238,913
7,138,913
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
TMC Technology UK Co., Ltd. is a private company limited by shares incorporated in England and Wales. The registered office is 12 Wedgwood Court, Stevenage, Herts, SG1 4QR.
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.
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.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
The company has taken advantage of the exemption under section 401 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
TMC Technology UK Co., Ltd. is a wholly owned subsidiary of IBASE Inc. and the results of TMC Technology UK Co., Ltd. are included in the consolidated financial statements of IBASE Inc. which are available from from its registered office, 11F, No. 3-1, Yuan Qu Street, Nankang, Taipei, Taiwan, R.O.C.
1.2
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. The directors have assessed the financial position of the company and determined that the company has, sufficient working capital for its need for at least the next 12 months from the date of approval of these financial statements. In view of this, the directors consider it appropriate to prepare the financial statements on the going concern basis.true
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (upon delivery of the goods to customers), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
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.
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
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:
Fixtures, fittings & equipment
25% straight line
Computer equipment
25% straight line
Motor vehicles
25% reducing balance
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 credited or charged to profit or loss.
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. 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 company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
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.
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 company 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 company 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.
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Other financial liabilities
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company 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 company.
1.10
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 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 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 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.
1.11
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
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 leases asset are consumed.
1.15
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 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 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.
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 17 -
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Dilapidation provision
The dilapidation provision represents the directors' best estimate of the cost of restoring the building to the state it was in upon initially occupying the building as lessee as this is an obligation upon the lease terminating. The provision is based on an estimate from a surveyor of the works required 4 years ago, augmented by a further amount to account for wear and tear since that estimate was received.
Stock provision
The stock provision estimate is designed to ensure that any & all slow moving or obsolete stock is measured at the lower of cost and net realisable value. The basis for the calculation is to include all stock items that have been held for longer than 6 months. The directors consider this to appropriate as the technology industry is prone to rapid change leading to the potential for stock lines to become obsolete quite quickly.
Bad debt provision
The bad debt provision represents the directors' best estimate of a potential impairment to the carrying value of trade debtors. This is calculated in two different ways, there is specific element where all older debtor balances are reviewed and specifically provided for if they appear to be irrecoverable, this is supplemented by a general bad debt provision which approximates to 5% of the total of the trade debtor balances.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by geographical market
U.K
2,936,936
2,921,210
Europe
6,825,309
10,388,323
Rest of the world
2,336,306
3,425,599
12,098,551
16,735,132
2023
2022
£
£
Other revenue
Interest income
89,877
7,556
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
41,309
(91,131)
Fees payable to the company's auditor for the audit of the company's financial statements
13,500
9,500
Depreciation of owned tangible fixed assets
16,839
18,725
Profit on disposal of tangible fixed assets
(20,901)
(17,409)
Operating lease charges
47,500
46,000
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Staff
10
11
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
750,498
732,983
Social security costs
91,572
92,413
Pension costs
138,663
118,786
980,733
944,182
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
53,040
57,107
Company pension contributions to defined contribution schemes
40,000
40,000
93,040
97,107
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
89,877
7,556
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
206,367
293,890
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
844,803
1,566,867
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
198,529
297,705
Tax effect of expenses that are not deductible in determining taxable profit
1,949
849
Other timing differences
5,889
(4,664)
Taxation charge for the year
206,367
293,890
9
Tangible fixed assets
Fixtures, fittings & equipment
Computer equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2023
25,079
45,452
100,032
170,563
Additions
2,134
2,134
Disposals
(51,116)
(51,116)
At 31 December 2023
25,079
47,586
48,916
121,581
Depreciation and impairment
At 1 January 2023
25,079
24,013
51,932
101,024
Depreciation charged in the year
6,101
10,738
16,839
Eliminated in respect of disposals
(51,116)
(51,116)
At 31 December 2023
25,079
30,114
11,554
66,747
Carrying amount
At 31 December 2023
17,472
37,362
54,834
At 31 December 2022
21,439
48,100
69,539
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
10
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
11
7,600
7,600
11
Subsidiaries
These financial statements are separate company financial statements for TMC Technology UK Co., Ltd.
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
IBASE Italy SRL
Via Sant Antonio 1/A, 28845 Domodossola, Verbania, Italy
Ordinary
100.00
12
Stocks
2023
2022
£
£
Finished goods and goods for resale
422,423
754,524
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,349,093
1,331,009
Amounts owed by group undertakings
75,000
75,000
Other debtors
16,293
27,875
Prepayments and accrued income
27,452
24,607
1,467,838
1,458,491
14
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
119,249
152,569
Amounts owed to group undertakings
559,996
1,193,680
Corporation tax
100,932
168,791
Other taxation and social security
288,328
146,715
Other creditors
49,838
52,024
Accruals and deferred income
22,478
30,042
1,140,821
1,743,821
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
15
Provisions for liabilities
2023
2022
£
£
Dilapidations
125,000
100,000
The dilapidations provision represents amounts expected to be payable on termination of the existing lease of the company's premises. The provision is based on the estimated cost of restoring the premises to the conditions agreed at the inception of the lease.
Movements on provisions:
Dilapidations
£
At 1 January 2023
100,000
Additional provisions in the year
25,000
At 31 December 2023
125,000
16
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
138,663
118,786
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.
17
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £200 each
4,500
4,500
900,000
900,000
TMC TECHNOLOGY UK CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
18
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
48,000
47,500
Between two and five years
156,000
204,000
204,000
251,500
19
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2023
2022
£
£
Aggregate compensation
503,230
350,471
20
Ultimate controlling party
The parent company of TMC Technology UK Co., Limited is IBASE Inc, a company registered in Samoa. The ultimate parent undertaking is IBASE Technology Inc, which prepare the IBASE Group consolidated financial statements. This is both the smallest and largest group of which the company is a member. These consolidated financial statements are available from its registered office, Bldg. F, 15F-1, No. 3, Yuan Qu Street, Nangang, Taipei 11503, Taiwan, R.O.C or the following link https://www.ibase.com.tw/en/ir/report.
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