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REGISTERED NUMBER: 05420512 (England and Wales)















Strategic Report, Report of the Director and

Audited Financial Statements for the Year Ended 30 April 2023

for

SPRUNG STUDIOS LTD

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)






Contents of the Financial Statements
for the year ended 30 April 2023




Page

Company Information 1

Strategic Report 2

Report of the Director 5

Report of the Independent Auditors 7

Statement of Comprehensive Income 11

Balance Sheet 12

Statement of Changes in Equity 13

Cash Flow Statement 14

Notes to the Cash Flow Statement 15

Notes to the Financial Statements 16


SPRUNG STUDIOS LTD

Company Information
for the year ended 30 April 2023







DIRECTOR: J D Inness-Chaytor





REGISTERED OFFICE: Preston Park House
South Road
Brighton
East Sussex
BN1 6SB





BUSINESS ADDRESS: First Floor
Locksview
Brighton Marina Village
Brighton
East Sussex
BN2 5HA





REGISTERED NUMBER: 05420512 (England and Wales)





AUDITORS: Feist Hedgethorne Limited
Statutory Auditors
Chartered Accountants
Preston Park House
South Road
Brighton
East Sussex
BN1 6SB

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Strategic Report
for the year ended 30 April 2023

The director presents his strategic report for the year ended 30 April 2023.

REVIEW OF BUSINESS
The company has had a strong trading performance in 2023 and continues to attract new talent and grow headcount which is a key driver of performance for the business. Average headcount at the year end is 75 staff across both UK and Canadian studios, an increase of 5 on average compared to the previous year. The company continues to be well placed to take advantage of the growing video games market and it has continued to trade satisfactorily since the balance sheet date.

The results are as follows:

Turnover: £9,016,891 (2022: £6,912,624)
Gross Profit of £8,946,189 (2022: £6,769,542)
Operating Profit of £2,586,868 (2022: £2,824,212)
Net assets of £6,570,243 (2022: £5,814,190)

The main financial highlights are as follows:
Gross profit margin increased by 1.3% to 99.2%.
Turnover increased by 30.4% to £9,016,891

The company is part of a group headed by Sprung Holdings Ltd, a company incorporated in Canada. The company is controlled by James Chaytor.

Governance and risk management framework
The leadership team is ensuring that robust processes are in place to identify, manage and report risks that threaten the business objectives of the company.

These include Financial, Operational and Regulatory Compliance risks. The principal feature of the company's risk management regime is a strong control environment, which is founded on an appropriate organisational structure for planning, executing, controlling and monitoring business operations. It includes clearly defined responsibilities and accountabilities.

Control procedures
These include: budgetary systems and management controls to manage financial risk, timely and accurate management information in respect of key performance measures and procedures to ensure complete and accurate accounting, which are regularly reviewed by the leadership team.


SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Strategic Report
for the year ended 30 April 2023

PRINCIPAL RISKS AND UNCERTAINTIES
There are a number of risks and uncertainties that can impact the performance of the company, some of which are beyond the control of the company and its board. The principal risks and uncertainties facing the company, as well as how the company works to mitigate these are set out below:

Client
The risk of project cancellation and client confidence is managed by providing high quality products on time and to client specifications. Projects are managed through milestones and progress against these is reported to the operating board on a monthly basis and weekly at the project level.

The risk of over reliance on key clients is managed through monitoring of the company's client concentration and actively seeking to work with other clients across the industry to diversify the client base.

Staff
The operations of the company depend upon the continuing employment of key staff and, due to the specialised sector in which it operates, the ability to recruit and retain people with the expertise and experience required. To achieve this, the company provides what it believes to be competitive remuneration commensurate with the industry plus best-in-class benefits across both studios.

The company seeks to continually develop its recruitment and retention activities.

Global Events
Globally, countries are faced with cost of living and climate change challenges. In addition, the conflict between Russia and Ukraine remains ongoing. The impact of these challenges on the company have been considered and no material impact is anticipated.

The impact of mass layoffs in the industry is being actively monitored and has the potential to either reduce workload or increase it. Continued and sustained marketing activities will offset the risk of project cancellations.

IT security and stability
Breach of IT security, unauthorised copying or software piracy could result in loss of business and reputational damage for the company, as well as associated negative financial impacts to revenue and costs from unauthorised copying of the intellectual property of clients.

Complete protection cannot be guaranteed, and an IT security breach could cause significant disruption to the company's operations.

Mitigating activities
The company's project work is protected by copy protection technology intended to prevent piracy.

The company conducts robust testing on systems and software, including penetration testing by external consultants. The implementation of action plans that arise from the results of testing is monitored by the leadership team.

Disaster recovery plans have been developed to ensure the business can recover from any interruptions with minimal impact.

Credit risk
The company's credit risk arises primarily through trade debtors. The amounts presented in the balance sheet are net of bad debt provisions. A bad debt provision is recognised by the entity when there is objective evidence that a debtor has become impaired.

Cash flow risk
The company is exposed to the financial risk of changes in foreign exchange rates and interest rates. The company retains significant amount of cash and is all equity financed.

Liquidity risk
In order to maintain liquidity and to ensure that the company has sufficient funds available for ongoing operations and to meet its obligations, the company places surplus funds into fixed term deposit accounts.


SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Strategic Report
for the year ended 30 April 2023

FUTURE DEVELOPMENTS
The Director feels that the company is well placed to continue its growth in subsequent years and continue to grow customer base and sales.

ON BEHALF OF THE BOARD:





J D Inness-Chaytor - Director


15 April 2024

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Report of the Director
for the year ended 30 April 2023

The director presents his report with the financial statements of the company for the year ended 30 April 2023.

PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of engaging in user experience, user interface design, user research and development for the video game industry.

DIVIDENDS
Four interim dividends per Ordinary share were paid throughout the year as follows:

1 February 2023 £3,040.68
2 February 2023 £3,070.67
6 February 2023 £3,092.38
7 February 2023 £3,097.80
£12,301.53

No dividends were paid in the year ended 30 April 2022.

The director does not recommend the payment of a final dividend.

RESEARCH AND DEVELOPMENT
The company continues to invest in the development of Artificial Intelligence in relation to developing tools that
assist the company in developing high quality products and ensure it is equipped to deal with continuing developments in this sector. This research and development will ensure that the company is able to evolve with the requirements of its customers.

DIRECTOR
J D Inness-Chaytor held office during the whole of the period from 1 May 2022 to the date of this report.

POLITICAL DONATIONS AND EXPENDITURE
The company made no political donations in the year ended 30 April 2023 (2022: £Nil).

GOING CONCERN
The director has a reasonable expectation that the company has adequate resources to continue in existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

EXISTENCE OF BRANCHES OUTSIDE OF THE UK
The company has a branch, as defined in s1046(3) of the Companies Act 2006, outside of the UK as follows:

Canada 1500 W Georgia St Suite 1400, Vancouver, BC V6G 2Z6

DIRECTORS INDEMNITIES
The company has made no qualifying third party indemnity provisions for the benefit of the Director.

DISCLOSURE IN THE STRATEGIC REPORT
Certain matters required by regulation to be dealt with in the annual report have been dealt with in the Strategic Report rather than in the Director's Report. These include principle risks and uncertainties and future developments.


SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Report of the Director
for the year ended 30 April 2023

STATEMENT OF DIRECTOR'S RESPONSIBILITIES
The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS
The auditors, Feist Hedgethorne Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:





J D Inness-Chaytor - Director


15 April 2024

Report of the Independent Auditors to the Members of
Sprung Studios Ltd

Opinion
We have audited the financial statements of Sprung Studios Ltd (the 'company') for the year ended 30 April 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of 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 30 April 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.

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 Auditors' 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 director with respect to going concern are described in the relevant sections of this report.

Other information
The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors 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 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.

Other matter
The accounts for the year ended 30 April 2022 were not audited, however we have made all the necessary attempts to ensure that the comparative figures show a true and fair view and are therefore free from material misstatement.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Sprung Studios Ltd


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 Report of the Director.

We have nothing to report in respect of the following matters where 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 director's remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

Responsibilities of director
As explained more fully in the Statement of Director's Responsibilities set out on page six, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Report of the Independent Auditors to the Members of
Sprung Studios Ltd


Auditors' 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 a Report of the Auditors 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:

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.

The extent to which the audit was considered capable of detecting irregularities including fraud
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence,
capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
- we identified the laws and regulations applicable to the company through discussions with directors and other
management, and from our commercial knowledge and experience;
- we focused on specific laws and regulations which we considered may have a direct material effect on the
financial statements or the operations of the company, including the Companies Act 2006, taxation legislation
and data protection, anti-bribery, employment, environmental and health and safety legislation;
- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of
management and inspecting legal correspondence; and
- identified laws and regulations were communicated within the audit team regularly and the team remained alert
to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge
of actual, suspected and alleged fraud; and
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and
regulations.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;
- tested journal entries to identify unusual transactions;
- assessed whether judgements and assumptions made in determining the accounting estimates set out in note 2
were indicative of potential bias; and
- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;
- enquiring of management as to actual and potential litigation and claims; and
- reviewing correspondence with HMRC and the company’s legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

Report of the Independent Auditors to the Members of
Sprung Studios Ltd


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 Report of the Auditors.

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 a Report of the Auditors 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.




Chris Morey (Senior Statutory Auditor)
for and on behalf of Feist Hedgethorne Limited
Statutory Auditors
Chartered Accountants
Preston Park House
South Road
Brighton
East Sussex
BN1 6SB

17 April 2024

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Statement of Comprehensive
Income
for the year ended 30 April 2023

2023 2022
(Unaudited)
Notes £    £   

TURNOVER 3 9,016,891 6,912,624

Cost of sales (70,702 ) (143,082 )
GROSS PROFIT 8,946,189 6,769,542

Administrative expenses (6,374,510 ) (3,952,701 )
2,571,679 2,816,841

Other operating income 15,189 7,371
OPERATING PROFIT 5 2,586,868 2,824,212

Interest receivable and similar income 39,669 380
PROFIT BEFORE TAXATION 2,626,537 2,824,592

Tax on profit 6 (640,332 ) (500,473 )
PROFIT FOR THE FINANCIAL YEAR 1,986,205 2,324,119

OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

1,986,205

2,324,119

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Balance Sheet
30 April 2023

2023 2022
(Unaudited)
Notes £    £   
FIXED ASSETS
Tangible assets 8 314,818 313,173

CURRENT ASSETS
Debtors 9 1,861,211 1,510,827
Investments 10 1,755,642 -
Cash at bank 3,690,810 5,968,834
7,307,663 7,479,661
CREDITORS
Amounts falling due within one year 11 (973,533 ) (1,978,644 )
NET CURRENT ASSETS 6,334,130 5,501,017
TOTAL ASSETS LESS CURRENT
LIABILITIES

6,648,948

5,814,190

PROVISIONS FOR LIABILITIES 13 (78,705 ) -
NET ASSETS 6,570,243 5,814,190

CAPITAL AND RESERVES
Called up share capital 14 100 100
Retained earnings 15 6,570,143 5,814,090
SHAREHOLDERS' FUNDS 6,570,243 5,814,190

The financial statements were approved by the director and authorised for issue on 15 April 2024 and were signed by:





J D Inness-Chaytor - Director


SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Statement of Changes in Equity
for the year ended 30 April 2023

Called up
share Retained Total
capital earnings equity
£    £    £   
Balance at 1 May 2021 100 3,489,971 3,490,071

Changes in equity
Total comprehensive income - 2,324,119 2,324,119
Balance at 30 April 2022 100 5,814,090 5,814,190

Changes in equity
Dividends - (1,230,152 ) (1,230,152 )
Total comprehensive income - 1,986,205 1,986,205
Balance at 30 April 2023 100 6,570,143 6,570,243

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Cash Flow Statement
for the year ended 30 April 2023

2023 2022
(Unaudited)
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 2,825,077 2,205,737
Tax paid (1,939,343 ) -
Net cash from operating activities 885,734 2,205,737

Cash flows from investing activities
Purchase of tangible fixed assets (106,585 ) (300,962 )
Sale of tangible fixed assets - 494
Fixed term deposits (1,837,097 ) -
Interest received 12,243 380
Net cash from investing activities (1,931,439 ) (300,088 )

Cash flows from financing activities
Amount introduced by directors 312 312
Amount withdrawn by directors (2,479 ) (4,734 )
Equity dividends paid (1,230,152 ) -
Net cash from financing activities (1,232,319 ) (4,422 )

(Decrease)/increase in cash and cash equivalents (2,278,024 ) 1,901,227
Cash and cash equivalents at beginning of
year

2

5,968,834

4,067,607

Cash and cash equivalents at end of year 2 3,690,810 5,968,834

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Cash Flow Statement
for the year ended 30 April 2023

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
2023 2022
(Unaudited)
£    £   
Profit before taxation 2,626,537 2,824,592
Depreciation charges 104,940 104,391
Profit on disposal of fixed assets - (123 )
(Gain)/ Loss on foreign exchange 99,311 (1,089 )
Finance income (39,669 ) (380 )
2,791,119 2,927,391
Increase in trade and other debtors (348,217 ) (736,635 )
Increase in trade and other creditors 382,175 14,981
Cash generated from operations 2,825,077 2,205,737

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 30 April 2023
30.4.23 1.5.22
£    £   
Cash and cash equivalents 3,690,810 5,968,834
Year ended 30 April 2022
30.4.22 1.5.21
(Unaudited)
£    £   
Cash and cash equivalents 5,968,834 4,067,607


3. ANALYSIS OF CHANGES IN NET FUNDS

At 1.5.22 Cash flow At 30.4.23
£    £    £   
Net cash
Cash at bank 5,968,834 (2,278,024 ) 3,690,810
5,968,834 (2,278,024 ) 3,690,810

Liquid resources
Current asset investments - 1,755,642 1,755,642
- 1,755,642 1,755,642
Total 5,968,834 (522,382 ) 5,446,452

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements
for the year ended 30 April 2023

1. STATUTORY INFORMATION

Sprung Studios Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


The functional currency is Canadian Dollars (C$). The reason the financial statements are presented in as GBP (£) opposed to C$ is that the company is incorporated in the United Kingdom, with accounts filed with the UK registrar and hence the Director considers the presentation in £ to be more appropriate and more useful to users of the financial statements in the UK.

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

Monetary amounts in these financial statements are rounded to the nearest pound.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Significant judgements and estimates
Preparation of the financial statements requires management to make significant judgements and estimates and these 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 items in the financial statements where these judgements and estimates have been made include the useful economic life of tangible fixed assets, the depreciation of these assets and recoverability of debtors.

Key sources of estimation uncertainty:
The annual depreciation charge for tangible fixed assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are depreciation over the approved depreciation rates. The carrying amount of tangible fixed assets is £314,818 (2022: £313,173) as noted in note 8.

No significant judgements have been made by management in preparing these financial statements.

Turnover
Revenue is measured at the fair value of the consideration received or receivable net of VAT and trade discounts, and is recognised as follows:

Revenue from the sale of game development services is recognised on completion of the work, based on set criteria of budget and work agreed.

Revenue for work that has been completed but not yet billed is included in debtors in the Balance Sheet and turnover in the Statement of Comprehensive Income. Revenue for work that has been billed in advance of the company satisfying the performance obligation is included in creditors in the Balance Sheet and recognised as turnover when the performance obligation has been satisfied.

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

2. ACCOUNTING POLICIES - continued

Tangible fixed assets
Tangible fixed assets are stated at cost, or deemed cost, less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended by management.

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Fixtures & fittings-25% on reducing balance
Motor Vehicles-25% on reducing balance
Computer equipment-25% on reducing balance

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 assets, 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 entity after deducting all of its financial liabilities.

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

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.

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 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.

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.


SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

2. ACCOUNTING POLICIES - continued
Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Leasing commitments
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Impairment
At each balance sheet date, the Company reviews the carrying amount of its assets to determine whether there is any indication that any items have suffered an impairment loss. If any such indication exists, the recoverable amount of an 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 asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Current asset investments
Current asset investments relate to fixed term deposits and are recognised at cost. Interest on the deposit is recognised as it accrued and interest earned but not yet received is included in debtors.

Going concern
The director has a reasonable expectation that the company has adequate resources to continue in existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

2. ACCOUNTING POLICIES - continued

Pension costs and other post-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 Income Statement when they fall due. Amounts not paid are shown in accruals as a liability on the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

Employee benefits
Short-term employee benefits are recognised as an expense in the period in which they are incurred.

In accordance with FRS 102, the company recognises the cost of any unused holiday entitlement in the period in which the employee's services are received.

3. TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2023 2022
(Unaudited)
£    £   
Europe 655,986 1,176,519
United States of America 8,084,364 5,736,105
Asia 276,541 -
9,016,891 6,912,624

4. EMPLOYEES AND DIRECTORS
2023 2022
(Unaudited)
£    £   
Wages and salaries 4,127,046 2,870,411
Social security costs 294,693 178,723
Other pension costs 140,096 99,114
4,561,835 3,148,248

The average number of employees during the year was as follows:
2023 2022
(Unaudited)

United Kingdom 28 27
Canada 47 43
75 70

2023 2022
(Unaudited)
£    £   
Director's remuneration 138,698 135,003

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

5. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2023 2022
(Unaudited)
£    £   
Other operating leases 599,959 451,203
Depreciation - owned assets 104,940 104,390
Profit on disposal of fixed assets - (123 )
Auditors' remuneration 11,500 -
Foreign exchange differences (60,420 ) (21,308 )
Statutory interest 120,814 -
Penalties 272,912 -

6. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
2023 2022
(Unaudited)
£    £   
Current tax:
UK corporation tax 453,643 400,350
Canadian taxes 107,984 100,123
Total current tax 561,627 500,473

Deferred tax 78,705 -
Tax on profit 640,332 500,473

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
(Unaudited)
£    £   
Profit before tax 2,626,537 2,824,592
Profit multiplied by the standard rate of corporation tax in the UK of
19.493% (2022 - 19%)

511,991

536,672

Effects of:
Expenses not deductible for tax purposes 54,981 1,056
Capital allowances in excess of depreciation - (37,255 )
Super deduction allowance (5,023 ) -
Prior year deferred tax charge at 25% 78,293 -
Deferred tax movement at 5.51% 90 -
Total tax charge 640,332 500,473

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

7. DIVIDENDS
2023 2022
(Unaudited)
£    £   
Ordinary shares of £1 each
Interim 1,230,152 -

8. TANGIBLE FIXED ASSETS
Fixtures
and Computer
fittings equipment Totals
£    £    £   
COST
At 1 May 2022 148,533 436,234 584,767
Additions 1,261 105,324 106,585
At 30 April 2023 149,794 541,558 691,352
DEPRECIATION
At 1 May 2022 74,318 197,276 271,594
Charge for year 18,869 86,071 104,940
At 30 April 2023 93,187 283,347 376,534
NET BOOK VALUE
At 30 April 2023 56,607 258,211 314,818
At 30 April 2022 74,215 238,958 313,173

9. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
(Unaudited)
£    £   
Trade debtors 1,542,654 1,487,933
Other debtors 59,255 17,928
Other taxation and social secu rity 157,971 -
Directors' current accounts 7,133 4,966
Prepayments & accrued income 94,198 -
1,861,211 1,510,827

10. CURRENT ASSET INVESTMENTS
2023 2022
(Unaudited)
£    £   
Fixed term deposits 1,755,642 -

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

11. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
(Unaudited)
£    £   
Trade creditors 10,569 16,502
Corporation tax 460,687 1,847,973
Other creditors 373,981 54,333
Other taxation and social secu rity 41,046 57,236
Accrued expenses 87,250 2,600
973,533 1,978,644

12. LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:
2023 2022
(Unaudited)
£    £   
Within one year 404,159 271,116
Between one and five years 436,847 586,226
841,006 857,342

The total fixed lease payments recognised as an expense were £404,264 (2022: £370,093).

13. PROVISIONS FOR LIABILITIES
2023 2022
(Unaudited)
£    £   
Deferred tax 78,705 -

Deferred
tax
£   
Accelerated capital allowances 78,705
Balance at 30 April 2023 78,705

14. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2023 2022
value: £    £   
100 Ordinary £1 100 100

SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512)

Notes to the Financial Statements - continued
for the year ended 30 April 2023

15. RESERVES
Retained
earnings
£   

At 1 May 2022 5,814,090
Profit for the year 1,986,205
Dividends (1,230,152 )
At 30 April 2023 6,570,143

16. DIRECTOR'S ADVANCES, CREDITS AND GUARANTEES

The following advances and credits to a director subsisted during the years ended 30 April 2023 and 30 April 2022:

2023 2022
(Unaudited)
£    £   
J D Inness-Chaytor
Balance outstanding at start of year 4,966 544
Amounts advanced 2,479 4,734
Amounts repaid (312 ) (312 )
Amounts written off - -
Amounts waived - -
Balance outstanding at end of year 7,133 4,966

This loan is repayable on demand. Interest, where the loan exceeds £10,000, is charged at HMRC's official rate of interest of 2%. No interest was charged during the year (2022: £Nil).

17. ULTIMATE CONTROLLING PARTY

Sprung Studios Ltd is a wholly owned subsidiary of Sprung Holdings Ltd, a company registered in Canada. The registered office is 937 Wentworth Avenue, North Vancouver, BC V7R 1R8.

The Director of Sprung Holdings Ltd is James Chaytor, who is the sole director of Sprung Studios Ltd and is the ultimate controlling party.