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Registered number: 02715181









THE CHANGE GROUP INTERNATIONAL PLC









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
COMPANY INFORMATION


Directors
S Zackariya 
L De Bourgoing 
I Cea Fornies (appointed 29 July 2022)
J Lopez Huerta (appointed 29 July 2022)
J Lasanta (appointed 29 July 2022)
P Crombie (resigned 29 July 2022)
P Greene (resigned 29 July 2022)
B Zackariya (resigned 29 July 2022)
P Meehan (resigned 29 July 2022)




Company secretary
C Mason



Registered number
02715181



Registered office
353 Oxford Street

London

W1C 2JG




Independent auditors
Harris & Trotter LLP
Chartered Accountants & Statutory Auditor

101 New Cavendish Street

1st Floor South

London

United Kingdom

W1W 6XH




Solicitors
Mishcon de Reya LLP
Africa House

70 Kingsway

London

WC2B 6AH





 
THE CHANGE GROUP INTERNATIONAL PLC
 

CONTENTS



Page
Strategic Report
1 - 2
Directors' Report
3 - 4
Independent Auditors' Report
5 - 8
Statement of Comprehensive Income
9
Statement of Financial Position
10
Statement of Changes in Equity
11
Statement of Cash Flows
12
Analysis of Net Debt
13
Notes to the Financial Statements
14 - 26


 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

Introduction
 
The Directors are pleased to present their Strategic Report for The Change Group International Plc for the year ended 31st December 2022.
The principal activity of The Change Group International Plc is that of a holding company. Its trading subsidiaries operate ultra-prime currency exchange branches, tax refund services for international shoppers, international money transfers and a network of multi-currency ATMs.
Since its foundation in 1992, ChangeGroup has grown to become one of the world's largest international Bureau de Change groups, with strong fundamentals and a decades long track record. 
ChangeGroup has won multiple awards, including the Queen’s Award for Enterprise from Her Majesty Queen Elizabeth II and the EU’s top 500 Job Creating Companies award, presented by the former German Chancellor, Gerhard Schroeder. Group subsidiaries have also been recognised for outstanding performance, notably ChangeGroup France, which has received the highest G3++ financial strength rating from the Banque de France in 2019.
ChangeGroup has grown to serve over 5 million customers each year. Tens of thousands of retailers and hospitality businesses around the world depend on customers that ChangeGroup attracts and serves.
In July 2022, Prosegur Cash S.A., a public company listed on the Bilbao, Barcelona, Madrid and Valencia Stock Exchanges purchased 65% of the issued share capital of The Change Group International (Holdings) Ltd, the Company's immediate parent, with an option to purchase the remaining shares over the next 5 years. This transaction strengthens the ChangeGroup's financial capacity and ability to grow the business to be one of the top foreign exchange providers in the world.

Business review
 
The Company operates as a holding company and generated a Profit after Tax for the year ended 31 December 2022 of £607,547 (2021: £441,029).  This amount was primarily generated by way of a dividend from its subsidiary in Estonia.

Principal risks and uncertainties
 
Operational Risk:
Operational risks include risks arising within the organisation from inadequate and failed internal processes, systems and unskilled staff. The Company seeks to mitigate this risk by establishing internal operational manuals, regular internal audits, ensuring staff receive ongoing training, backed up by exams and qualifications, rigorous recruitment processes with psychometric testing, as well as investing in efficient IT systems.
Currency Risk:
The Company has investments in companies which operate in 9 countries, and as a result of this it is subject to foreign currency exposure. However, this risk is mitigated by the geographic spread of the company’s investments.
Price, Credit and Cash Flow Risk:
The Company’s principal financial instruments comprise bank balances and loans to and from its subsidiaries. The main purpose of these instruments is to finance the Group’s operations. 
Liquidity risk is managed by maintaining a minimal bank balance in the company.  
Intra-group debtor and creditor balances are managed in order to facilitate the funding of the Company’s subsidiary operating companies.

Page 1

 
THE CHANGE GROUP INTERNATIONAL PLC
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

Financial key performance indicators
 
For the Company, the primary performance indicator is profit after tax which, for the year ended 31 December 2022, was £607,547 (2021: £441,029).

Directors' statement of compliance with duty to promote the success of the Company
 
Section 172 of the Companies Act 2006 requires the directors of a company to act in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its shareholders as a whole and, in doing so have regard (amongst other matters) to:
• The likely consequences of any decisions in the long-term.
• The interests of the Company's employees.
• The need to foster the Company's business relationships with suppliers, customers and others.
• The impact of the Company's operations on the community and environment.
• The desirability of the Company maintaining a reputation for high standards of business conduct; and
• The need to act fairly as between shareholders and the Company:
As part of their induction, a director is briefed on their duties and they can access professional advice on these, either from the Company Secretary or, if they judge it necessary, from an independent advisor.
The Board confirms that, during the year, it has had regard to the matters set out above. Further details as to how the directors have fulfilled their duties, are disclosed within the relevant areas within this Strategic Report, Directors' Report and Financial Statements.


This report was approved by the board and signed on its behalf.



................................................
I Cea Fornies
Director

Date: 2 April 2024

Page 2

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

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

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £607,547 (2021 - £441,029).

No dividends were declared or paid in the period. 

Directors

The directors who served during the year were:

S Zackariya 
L De Bourgoing 
I Cea Fornies (appointed 29 July 2022)
J Lopez Huerta (appointed 29 July 2022)
J Lasanta (appointed 29 July 2022)
P Crombie (resigned 29 July 2022)
P Greene (resigned 29 July 2022)
B Zackariya (resigned 29 July 2022)
P Meehan (resigned 29 July 2022)

Page 3

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

Future developments

The Company will continue as the holding company for its subsidiaries which continue to look to expand their operations both in downtown and gateway locations. The operating companies are keen to  identify new  locations and to tender for airport and railway  concessions across the world.

Greenhouse gas emissions, energy consumption and energy efficiency action

The Company has not disclosed information in respect of greenhouse gas emissions, energy consumption and energy efficiency action as its energy consumption in the United Kingdom for the year is 40,000kWh or lower.

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

The Change Group Estonia OÜ was liquidated on 5 April 2023.

Auditors

The auditorsHarris & Trotter LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





................................................
I Cea Fornies
Director

Date: 2 April 2024

Page 4

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CHANGE GROUP INTERNATIONAL PLC
 

Opinion


We have audited the financial statements of The Change Group International Plc (the 'Company') for the year ended 31 December 2022, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 2022 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 United Kingdom, including the Financial Reporting Council'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.


Page 5

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CHANGE GROUP INTERNATIONAL PLC (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion 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 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.


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 directors' 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 set out on page 3, 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.


Page 6

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CHANGE GROUP INTERNATIONAL PLC (CONTINUED)


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 an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
The objectives of our audit are to identify and assess the risks of material misstatement of the financial statements due to fraud or error; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud or error; and to respond appropriately to those risks. Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). 
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
• We obtained an understanding of the legal and regulatory frameworks applicable to the Company and the industry in which it operates. We determined that the following laws and regulations were most significant: FRS 102 and the Companies Act 2006. 
• We obtained an understanding of how the Company is complying with those legal and regulatory frameworks by making enquiries of management. 
• We challenged assumptions and judgements made by management in its significant accounting estimates. 
We did not identify any key audit matters relating to irregularities, including fraud. 


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 Auditors' Report.


Other matters 
 

The financial statements of The Change Group International Plc for the year ended 31 December 2021, were audited by another auditor who expressed an unmodified opinion on those statements on 26 October 2023.


Page 7

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CHANGE GROUP INTERNATIONAL PLC (CONTINUED)


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 2006Our 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 Auditors' 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.





Stephen Haffner (Senior Statutory Auditor)
  
for and on behalf of
Harris & Trotter LLP
 
Chartered Accountants & Statutory Auditor
  
101 New Cavendish Street
1st Floor South
London
United Kingdom
W1W 6XH

2 April 2024
Page 8

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022

2022
2021
Note
£
£

  

Administrative expenses
  
(256,775)
510,450

Other operating income
 4 
40,902
619,457

Operating (loss)/profit
  
(215,873)
1,129,907

Income from fixed assets investments
  
1,312,392
500,000

Amounts written off investments
  
(100)
(1,342,000)

Interest payable and similar expenses
 8 
(182,628)
-

Profit before tax
  
913,791
287,907

Tax on profit
 9 
(306,244)
153,122

Profit for the financial year
  
607,547
441,029

There were no recognised gains and losses for 2022 or 2021 other than those included in the statement of comprehensive income.

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

The notes on pages 14 to 26 form part of these financial statements.

Page 9

 
THE CHANGE GROUP INTERNATIONAL PLC
REGISTERED NUMBER: 02715181

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022

2022
2021
Note
£
£

Fixed assets
  

Investments
 10 
13,696,134
13,696,234

  
13,696,134
13,696,234

Current assets
  

Debtors: amounts falling due within one year
 11 
2,024,618
4,125,422

  
2,024,618
4,125,422

Current liabilities
  

Creditors: amounts falling due within one year
 12 
(1,182,228)
(4,068,785)

Net current assets
  
 
 
842,390
 
 
56,637

Total assets less current liabilities
  
14,538,524
13,752,871

Creditors: amounts falling due after more than one year
 13 
(3,878,106)
(3,700,000)

  

Net assets
  
10,660,418
10,052,871


Capital and reserves
  

Called up share capital 
 15 
500,000
500,000

Share premium account
 16 
22,500
22,500

Profit and loss account
 16 
10,137,918
9,530,371

  
10,660,418
10,052,871


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




................................................
I Cea Fornies
Director

Date: 2 April 2024

The notes on pages 14 to 26 form part of these financial statements.

Page 10

 
THE CHANGE GROUP INTERNATIONAL PLC
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022


Called up share capital
Share premium account
Profit and loss account
Total equity

£
£
£
£


At 1 January 2021
500,000
22,500
9,089,342
9,611,842


Comprehensive income for the year

Profit for the year
-
-
441,029
441,029
Total comprehensive income for the year
-
-
441,029
441,029


Total transactions with owners
-
-
-
-



At 1 January 2022
500,000
22,500
9,530,371
10,052,871


Comprehensive income for the year

Profit for the year
-
-
607,547
607,547
Total comprehensive income for the year
-
-
607,547
607,547


Total transactions with owners
-
-
-
-


At 31 December 2022
500,000
22,500
10,137,918
10,660,418


The notes on pages 14 to 26 form part of these financial statements.

Page 11

 
THE CHANGE GROUP INTERNATIONAL PLC
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022

2022
2021
£
£

Cash flows from operating activities

Profit for the financial year
607,547
441,029

Adjustments for:

Impairments of fixed assets
100
1,342,000

Interest paid
182,628
-

Dividend received
(1,312,392)
(500,000)

Taxation charge
306,244
(153,122)

Decrease/(increase) in amounts owed by groups
1,794,559
(4,006,422)

(Decrease)/increase in creditors
(36,757)
-

(Decrease) in amounts owed to groups
(2,849,799)
(188,215)

Others
-
153,026

Net cash generated from operating activities

(1,307,870)
(2,911,704)


Cash flows from investing activities

Purchase of unlisted and other investments
-
(1,288,296)

Dividends received
1,312,392
500,000

Net cash from investing activities

1,312,392
(788,296)

Cash flows from financing activities

New loans from group companies
178,106
3,700,000

Interest paid
(182,628)
-

Net cash used in financing activities
(4,522)
3,700,000

Net increase in cash and cash equivalents
-
-

Cash and cash equivalents at the end of year
-
-


Cash and cash equivalents at the end of year comprise:

-
-


The notes on pages 14 to 26 form part of these financial statements.

Page 12

 
THE CHANGE GROUP INTERNATIONAL PLC
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2022




At 1 January 2022
Cash flows
At 31 December 2022
£

£

£

Debt due within 1 year

(3,700,000)

(178,106)

(3,878,106)


(3,700,000)
(178,106)
(3,878,106)

The notes on pages 14 to 26 form part of these financial statements.

Page 13

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

1.


General information

The Change Group International Plc is a public company limited by shares and incorporated in England and Wales. Its registered head office is located at 353 Oxford Street, London, W1C 2JG. 

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Exemption from preparing consolidated financial statements

The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of any part of the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006.

 
2.3

Going concern

After reviewing the Company's forecasts and projections, which cover the 12-month period from the date of signing of the financial statements, the directors have a reasonable expectation that the Company have adequate resources to continue in operational existence for the foreseeable future. We consider that the current cash resources and those generated from the day-to-day operations of the business are sufficient to meet the existing needs of the business. 
The acquisition of the Group by Prosegur Cash S.A. on 29th July 2022 resulted in the repayment of the Group overdraft facility and loan from Lloyds Bank. The shareholders agreement between Sacha Zackariya and Prosegur Cash S.A. secures the provision of debt funding by Prosegur, third parties or otherwise by way of additional equity funding. Our forecasts do not anticipate the utilisation of this additional available funding. 
Since the acquisition of The Change Group by Prosegur Cash S.A., the Group has been successful in winning several airport and railway station concessions and is taking advantage of the opportunities available in the sector. This offers the Company great opportunities for growth. 
The Company therefore continues to adopt the going concern basis in preparing the consolidated financial statements.

 
2.4

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Page 14

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.5

Taxation

Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

 
2.6

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Company shares, whose market value can be reliably determined, are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in the Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

Investments in listed company shares are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in profit or loss for the period.

 
2.7

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.8

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Page 15

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.9

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.

Financial instruments are recognised in the Company's Statement of Financial Position 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.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

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

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

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

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Page 16

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)


2.9
Financial instruments (continued)


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

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

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

Page 17

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include: 
Impairment of investments
In order to assess whether any impairment exists on investments, management has performed a high-level assessment by comparing the carrying value of the investments to the net asset value as per the financials of the investments. Management has also reviewed the forecasts and budgets for a period of 3-5 years of the investments and evaluated the operating cash flows generated from the business to conclude on whether any impairments are required. In the process of making these budgets and forecasts, management makes assumptions and judgements using historic trends, planned opening of new branches etc. These estimates made by the management could lead to changes in subsequent periods.
Danish Tax
As of 31 December 2022, there was an ongoing investigation by the Danish tax authority (DTA) into the tax affairs of The Change Group Denmark ApS (TCG Denmark). The DTA contended that all currency sales should be reported in financial statements gross and currency purchases treated as cost of sales. In addition, the DTA claimed that TCG Denmark did not collect the necessary documentation in respect of 'buy' transactions.
During its subsequent investigations, the DTA conceded that the accounts of TCG Denmark have in fact been prepared in accordance with the relevant accounting standards and that TCG Denmark has not breached AML regulations.
However, in March 2022, the DTA issued assessments based on the cost of 'buy' currency transactions with retail customers not being allowed as a deduction from profits.
The Change Group Denmark ApS does not accept the basis for these assessments. After discussions with the DTA, the opinion of the Company's professional advisers is that these assessments are based on a factually incorrect approach, with no basis in law and should be cancelled following a decision of a tax Tribunal or appeal Court.
TCG Denmark has appealed against the assessments and a hearing of the tax Tribunal is pending. In December 2023 the scheduled hearing was postponed as TCG Denmark and their legal representatives have made an application to the District Court to request a formal evaluation of their bookkeeping practices by an independent expert, the findings of which they wish to submit to be considered in the case. This is currently pending a decision by the District Court. 
Should the decision of the Tribunal be in favour of the DTA, the Company would pursue the case to the District Court and further to the High Court. TCG Denmark would challenge the treatment adopted by the DTA on the basis that it is incompatible with EU law which regards foreign exchange businesses as providers of a service.
However, should the assessments be upheld, the additional liability to Danish tax is estimated by the tax authorities in Denmark to be DKK98m (GBP 11 m) in respect of the three years ended 31 December 2018. There could be additional tax assessed for the two years ended 31 December 2020. In subsequent years, to mitigate exposure to such assessments, TCG Denmark collected identification of the customers involved in all 'buy' transactions.
We have also been advised by our legal advisors that in the scenario where the tax authorities' position is upheld and TCG Denmark is unable to pay the tax, then in light of the limited liability status of the company, the fact that it is taxed as an Ordinary Corporation and that there is no joint taxation, either
Page 18

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

3.Judgments in applying accounting policies (continued)

Danish or international, the DTA would have no recourse to the wider Group. It is therefore the view of Group management that the exposure to the Group would be limited to the amounts currently recorded as an investment in the Danish subsidiary on the Company balance sheet of £1.3m. Consequently the investment has been fully written off in these financial statements.  


4.


Other operating income

2022
2021
£
£

Other operating income
100
619,457

Foreign exchange difference - gain
40,802
-

40,902
619,457



5.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors and their associates:


2022
2021
£
£

Fees payable to the Company's auditors and their associates in respect of:

Audit-related assurance services
10,000
-

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.


6.


Employees




The average monthly number of employees, including the directors, during the year was as follows:


        2022
        2021
            No.
            No.







Directors
9
10

Page 19

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

7.


Income from investments

2022
2021
£
£





Dividends received from unlisted investments
(1,312,392)
(500,000)

(1,312,392)
(500,000)



8.


Interest payable and similar expenses

2022
2021
£
£


Loans from group undertakings
182,628
-

182,628
-


9.


Taxation


2022
2021
£
£

Corporation tax


Current tax on profits for the year
306,244
(153,122)


306,244
(153,122)


Total current tax
306,244
(153,122)

Deferred tax

Total deferred tax
-
-


Tax on profit
306,244
(153,122)
Page 20

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
 
9.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2021 - lower than) the standard rate of corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:

2022
2021
£
£


Profit on ordinary activities before tax
913,791
287,907


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021 - 19%)
173,620
54,702

Effects of:


Non-tax deductible amortisation of goodwill and impairment
-
254,980

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
-
(61,560)

Other adjustments to tax charge
306,244
-

Dividends from UK companies
(249,544)
(95,000)

Non-trading loan relationship deficits carried forward
34,699
-

Group relief
41,225
(306,244)

Total tax charge for the year
306,244
(153,122)


Factors that may affect future tax charges

The corporation tax main rate will increase from 19% to 25% from April 2023.

Page 21

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

10.


Fixed asset investments





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2022
18,295,358



At 31 December 2022

18,295,358



Impairment


At 1 January 2022
4,599,124


Charge for the period
100



At 31 December 2022

4,599,224



Net book value



At 31 December 2022
13,696,134



At 31 December 2021
13,696,234

Page 22

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

The Change Group Corporation Limited
353 Oxford Street, London, England, W1C 2JG
Ordinary
100%
The Change Group London Limited
353 Oxford Street, London, England, W1C 2JG
Ordinary
100%
The Change Group Denmark ApS
Denmark
Ordinary
100%
The Change Group Helsinki OY
Finland
Ordinary
100%
The Change Group Wechselstuben GmbH
Austria
Ordinary
100%
The Change Group New York Inc
USA
Ordinary
100%
The Change Group Australia PTY Limited
Australia
Ordinary
100%
The Change Group Sweden AB
Sweden
Ordinary
100%
ChangeGroup Estonia OU*
Estonia
Ordinary
100%
ChangeGroup ATMs Limited
353 Oxford Street, London, England, W1C 2JG
Ordinary
100%
ChangeGroup Spain SA
Spain
Ordinary
100%
ChangeGroup Hospitality Ltd**
353 Oxford Street, London, England, W1C 2JG
Ordinary
100%

*Liquidated in April 2023
** Dissolved in September 2022


11.


Debtors

2022
2021
£
£


Amounts owed by group undertakings
2,024,618
3,819,178

Other debtors
-
306,244

2,024,618
4,125,422


Page 23

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

12.


Creditors: Amounts falling due within one year

2022
2021
£
£

Amounts owed to group undertakings
1,172,228
4,022,028

Accruals and deferred income
10,000
46,757

1,182,228
4,068,785



13.


Creditors: Amounts falling due after more than one year

2022
2021
£
£

Amounts owed to group undertakings
3,878,106
3,700,000

3,878,106
3,700,000



14.


Financial instruments

2022
2021
£
£

Financial assets


Financial assets measured at fair value through profit or loss
13,696,134
13,696,234

Financial assets measures at amortised cost
2,024,618
3,819,178

15,720,752
17,515,412


Financial liabilities


Other financial liabilities measured at amortised cost
5,060,334
7,768,785


Financial assets measured at fair value through profit or loss comprise of equity instruments held by the entity.


Financial assets measured at amortised cost comprise of intercompany debtors. 


Other financial liabilities measured at amortised cost comprise of intercompany creditors and accruals. 

Page 24

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

15.


Share capital

2022
2021
£
£
Allotted, called up and fully paid



500,000 (2021 - 500,000) Ordinary shares of £1.00 each
500,000
500,000

There is a single class of ordinary shares. There are no restrictions on dividends and the repayment of capital. 



16.


Reserves

Share premium account

Includes any premium received on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium. 

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses. 


17.


Contingent liabilities

The Company has provided cross guarantees in the form of a debenture dated 8 June 1994 and an omnibus guarantee dated 11 January 2012 in respect of its fellow group undertaking's borrowings. The amounts outstanding are disclosed in those Company's financial statements. 


18.


Related party transactions

The Company has taken advantage of the exemption contained in FRS 102 paragraph 33.1A not to disclose transactions entered into between two or more members of the group where subsidiaries party to the transaction is wholly owned by such a member. 
Key management personnel are remunerated through other group entities therefore remuneration of key management personnel amounted to £Nil (2021: £Nil). 
Included within creditors is a loan owed to Prosegur Compañía de Seguridad, a group entity under common control, of £3,878,106 
(2021: £3,700,000).
The company also owed £167,914 
(2021: Nil) to a group entity under common control, included in amounts owed to group undertakings within creditors falling due in less than 1 year. 


19.


Post balance sheet events

The Change Group Estonia OÜ was liquidated on 5 April 2023.

Page 25

 
THE CHANGE GROUP INTERNATIONAL PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

20.


Controlling party

The immediate parent company is The Change Group International (Holdings) Limited, a company incorporated in England and Wales. The Change Group International (Holdings) Ltd produces consolidated financial statements which are publicly available on Companies House. 
The ultimate controlling party is Gubel S.L., a company incorporated in Madrid, Spain, and the ultimate parent of the Prosegur Group which in turn holds 65% of the ordinary shares of The Change Group International (Holdings) Limited.

 
Page 26