Company registration number 09148223 (England and Wales)
SOURCEBREAKER LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
PAGES FOR FILING WITH REGISTRAR
SOURCEBREAKER LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 10
SOURCEBREAKER LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 1 -
Unaudited
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
5
96,811
68,039
Current assets
Debtors
6
2,131,451
1,584,447
Cash at bank and in hand
4,066,550
2,168,331
6,198,001
3,752,778
Creditors: amounts falling due within one year
7
(6,780,711)
(2,522,545)
Net current (liabilities)/assets
(582,710)
1,230,233
Total assets less current liabilities
(485,899)
1,298,272
Creditors: amounts falling due after more than one year
8
-
(806,965)
Net (liabilities)/assets
(485,899)
491,307
Capital and reserves
Called up share capital
9
2
2
Share premium account
10
4,693,204
4,616,092
Profit and loss reserves
11
(5,179,105)
(4,124,787)
Total equity
(485,899)
491,307
The notes on pages 2 to 10 form part of these financial statements.
The director of the company has elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 12 April 2024 and are signed on its behalf by:
Mr B Sylvester
Director
Company Registration No. 09148223
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
1
Accounting policies
Company information
Sourcebreaker Limited is a private company limited by shares incorporated in England and Wales. The registered office is 155 Bishopsgate, 8th Floor, London, Greater London, United Kingdom, EC2M 3AJ.
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 comparative period was not subject to audit as the company claimed exemption under S477 of the Companies Act 2006.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The financial statements have been prepared on a going concern basis, which assumes that the company will continue in operational existence for the foreseeable future.true
The director has reviewed detailed forecasts and plans and made enquiries, indicating that the company has sufficient funding to continue its operations for a minimum of 12 months from the date of approval of these financial statements, noting that the company has been profitable in the post year end period as part of the Bullhorn group. The director has received confirmation that intercompany balances will not be required to be paid for a period until at least 12 months following the approval of these financial statements, and has also received a letter of support, which indicates that Bullhorn Inc, the main trading US group company, will support the company if required, to enable it to meet it's liabilities as and when they fall due until 31 May 2025.
Having made enquiries to assess the ability of Bullhorn Inc to provide such support, the director is confident that if required, such support could be provided.
For the reasons set out above, the director has prepared the financial statements on a going concern basis, and has concluded that there are no material uncertainties related to going concern.
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 generated from the sales of licenses is recognised in the period to which it relates, and professional service revenue in the period when the service has been provided.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 3 -
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:
Land and buildings
33% Reducing Balance
Plant and machinery etc
33% Reducing Balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
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.
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 4 -
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.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 5 -
1.8
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.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.11
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.12
Share-based payments
Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 6 -
When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.
Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.
1.13
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.14
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.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Total
75
63
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 7 -
4
Director's remuneration
2022
2021
£
£
Remuneration paid to directors
190,750
267,210
The number of directors who exercised share options during the year was 1 (2021 - 0).
5
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2022
107,628
107,628
Additions
20,000
61,365
81,365
Disposals
(56,583)
(56,583)
At 31 December 2022
20,000
112,410
132,410
Depreciation and impairment
At 1 January 2022
39,589
39,589
Depreciation charged in the year
3,649
25,730
29,379
Eliminated in respect of disposals
(33,369)
(33,369)
At 31 December 2022
3,649
31,950
35,599
Carrying amount
At 31 December 2022
16,351
80,460
96,811
At 31 December 2021
68,039
68,039
6
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
907,160
679,258
Corporation tax recoverable
487,003
Other debtors
595,617
339,931
1,502,777
1,506,192
Deferred tax asset
593,259
2,096,036
1,506,192
2022
2021
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
6
Debtors
(Continued)
- 8 -
Amounts falling due after more than one year:
£
£
Other debtors
35,415
78,255
Total debtors
2,131,451
1,584,447
7
Creditors: amounts falling due within one year
2022
2021
£
£
Bank loans and overdrafts
992
173,035
Trade creditors
23,708
130,468
Amounts owed to group undertakings
3,598,111
Taxation and social security
322,254
374,920
Deferred income
1,666,634
1,362,062
Other creditors
37,070
58,565
Accruals
1,131,942
423,495
6,780,711
2,522,545
Amounts owed to group undertakings are unsecured, interest free and repayable on demand.
8
Creditors: amounts falling due after more than one year
2022
2021
£
£
Bank loans and overdrafts
806,965
Bank loans and overdrafts were repaid as part of the change in control referred to at note 14.
9
Called up share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of 0.0004p each
371,894
306,725
1
1
A Ordinary of 0.0004p each
148,519
148,519
1
1
520,413
455,244
2
2
On 15 July 2022, the company issued 65,169 ordinary shares with a nominal value of £0.000004 each for total consideration of £77,112.
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
10
Share premium account
Share premium represents the cumulative of money received for the company's shares, over and above their nominal value.
11
Profit and loss reserves
The profit and loss reserve represents accumulated profits and losses.
12
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was qualified and the auditor reported as follows:
We have audited the financial statements of Sourcebreaker Limited (the 'company') for the year ended 31 December 2022 which comprise the profit and loss account, the balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion, except for the possible effects of the matter described in the "Basis for qualified opinion" paragraph, 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 loss 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 qualified opinion
The company has not recognised an equity settled share-based payment transaction in the current period in respect of share options issued to employees of the company which is contrary to the requirements of FRS102 Section 26. This includes an accelerated share based payment charge when the Bullhorn group acquired the company. The necessary information to make such accounting entries including assessing the fair value of the share options at grant date is not available to management following the change of control, and therefore we are also unable to obtain sufficient and appropriate evidence as to whether a material error is present within administrative expenses and within equity in the year ended 31 December 2022.
Any disclosures required by FRS102 are also omitted for the above possible misstatements. Any references to totals or balances in the directors’ report such the result for the period, would also need to be amended were any material adjustments required.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
The Senior statutory auditor was Ben Sheldon ACA and the auditor was Azets Audit Services.
SOURCEBREAKER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 10 -
13
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2022
2021
As restated
£
£
320,000
114,960
The comparative figure has been restated to include a lease that was in effect until May 2022.
14
Related party transactions
The company has taken advantage of the exemption available per paragraph 33.1A of FRS 102 whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertaking of the group.
15
Parent company
Until the 15th July 2022, the company was under the control of Mr S Beckitt given his greater than 50% shareholding in the company.
On the 15th July 2022, the entire share capital was purchased by Invenias Limited (part of the Bullhorn Group), a company incorporated in the United Kingdom, with its registered office at 155 Bishopsgate, 8th Floor, London, EC2M 3AJ.
The ultimate parent company is BH Acquisition Holding Company LP, a company incorporated in the US, whose registered address is 20 Horseneck Lane, Greenwich, Connecticut, 06830.
The ultimate controlling party is Stone Point Capital LLC, a Private Equity firm registered in the US.