Company registration number 05708056 (England and Wales)
CARBON8 SYSTEMS LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
CARBON8 SYSTEMS LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 9
CARBON8 SYSTEMS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
3
3,186,808
2,359,507
Tangible assets
4
238,472
378,605
Investments
5
1
1
3,425,281
2,738,113
Current assets
Stocks
333,688
243,262
Debtors
6
517,769
874,503
Cash at bank and in hand
893,340
762,312
1,744,797
1,880,077
Creditors: amounts falling due within one year
7
(4,544,475)
(3,206,160)
Net current liabilities
(2,799,678)
(1,326,083)
Total assets less current liabilities
625,603
1,412,030
Creditors: amounts falling due after more than one year
8
(24,391)
(34,427)
Net assets
601,212
1,377,603
Capital and reserves
Called up share capital
9
4,364
3,923
Share premium account
9,461,711
7,346,964
Profit and loss reserves
(8,864,863)
(5,973,284)
Total equity
601,212
1,377,603

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

For the financial year ended 31 December 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

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

CARBON8 SYSTEMS LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 DECEMBER 2023
31 December 2023
- 2 -
The financial statements were approved by the board of directors and authorised for issue on 15 April 2024 and are signed on its behalf by:
Dr P J Carey
J Pilkington
Director
Director
Company Registration No. 05708056
CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
1
Accounting policies
Company information

Carbon8 Systems Limited is a private company limited by shares incorporated in England and Wales . The registered office is Cumberland Court, 80 Mount Street, Nottingham, NG1 6HH and the company registered number is 05708056.

 

The principal activity of the company during the year was that of research and development in the treatment of waste.

1.1
Accounting convention

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

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

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

The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.

1.2
Going concern

Thetrue financial statements have been prepared on a going concern basis. The validity of this assumption depends upon the continued financial support of third parties who have indicated their willingness to support the company financially. On this basis the directors consider that the company is a going concern for the foreseeable future.

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 contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.5
Intangible fixed assets other than goodwill

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

CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -

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

Software
33% straight line
Product development in progress
No amortisation charged, not yet in use
1.6
Tangible fixed assets

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

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

Other fixed assets
20% straight line
Office equipment
33% straight line

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

1.7
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.

1.8
Impairment of fixed assets

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

1.9
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.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

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.

1.10
Cash and cash equivalents

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

CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
1.11
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.

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, 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.

1.12
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.

1.13
Taxation

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

Current tax

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

CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
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.

1.14
Employee benefits

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

 

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

1.15
Retirement benefits

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

1.16
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

1.17
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.18

Interest income

Interest income is recognised in profit or loss using the effective interest method.

CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2
Employees

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

2023
2022
Number
Number
Total
34
38
3
Intangible fixed assets
Software
Product development in progress
Total
£
£
£
Cost
At 1 January 2023
21,281
2,341,730
2,363,011
Additions
6,232
828,771
835,003
At 31 December 2023
27,513
3,170,501
3,198,014
Amortisation and impairment
At 1 January 2023
3,504
-
0
3,504
Amortisation charged for the year
7,702
-
0
7,702
At 31 December 2023
11,206
-
0
11,206
Carrying amount
At 31 December 2023
16,307
3,170,501
3,186,808
At 31 December 2022
17,777
2,341,730
2,359,507
CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
4
Tangible fixed assets
Other fixed assets
Office equipment
Total
£
£
£
Cost
At 1 January 2023
740,353
71,830
812,183
Additions
23,859
6,049
29,908
At 31 December 2023
764,212
77,879
842,091
Depreciation and impairment
At 1 January 2023
406,524
27,054
433,578
Depreciation charged in the year
147,261
22,780
170,041
At 31 December 2023
553,785
49,834
603,619
Carrying amount
At 31 December 2023
210,427
28,045
238,472
At 31 December 2022
333,829
44,776
378,605
5
Fixed asset investments
2023
2022
£
£
Shares in group undertakings and participating interests
1
1
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
3,657
25,248
Corporation tax recoverable
372,833
662,144
Other debtors and prepayments
129,981
187,111
Accrued income
11,298
-
0
517,769
874,503
CARBON8 SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
7
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans
10,059
9,811
Obligations under finance leases
-
0
17,891
Other borrowings
3,459,500
364,500
Trade creditors
142,806
501,865
Taxation and social security
58,650
77,404
Deferred income
750,000
880,310
Other creditors
83,191
1,191,461
Accruals
40,269
162,918
4,544,475
3,206,160
8
Creditors: amounts falling due after more than one year
2023
2022
£
£
Bank loans
24,391
34,427
9
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of 1p each
309,674
307,496
3,097
3,075
Ordinary B shares of 1p each
1,420
1,420
14
14
Series A shares of 1p each
125,330
83,438
1,253
834
436,424
392,354
4,364
3,923

On 17 March 2023, 41,892 Series A shares were allotted at £47.94 per share in conversion for shareholder loans and 2,178 Ordinary A shares were allotted for a total amount of £106,863 in conversion of the directors loan accounts.

 

The rights to the shares can be found at Companies House.

10
Share-based payments

The company has granted share options totalling 26,158 and the exercise price is different for each holder. At the year end, the conditions around the exercise had not been met so all options remain outstanding.

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