Company registration number 12159846 (England and Wales)
COGNASSIST UK LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
COGNASSIST UK LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
4 - 10
COGNASSIST UK LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
4
81,815
128,020
Current assets
Debtors
5
1,084,209
1,032,434
Cash at bank and in hand
2,421,735
443,307
3,505,944
1,475,741
Creditors: amounts falling due within one year
6
(1,654,964)
(1,968,511)
Net current assets/(liabilities)
1,850,980
(492,770)
Total assets less current liabilities
1,932,795
(364,750)
Creditors: amounts falling due after more than one year
7
(249,597)
(497,116)
Provisions for liabilities
(258)
(15,804)
Net assets/(liabilities)
1,682,940
(877,670)
Capital and reserves
Called up share capital
9
167
100
Share premium account
9,965,657
6,065,724
Other reserves
(5,928,729)
(5,928,729)
Profit and loss reserves
(2,354,155)
(1,014,765)
Total equity
1,682,940
(877,670)
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.
COGNASSIST UK LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023
- 2 -
The financial statements were approved by the board of directors and authorised for issue on 26 July 2024 and are signed on its behalf by:
C J Quickfall
Director
Company registration number 12159846 (England and Wales)
COGNASSIST UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Share capital
Share premium account
Demerger reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
100
6,065,724
(5,928,729)
(549,267)
(412,172)
Year ended 31 December 2022:
Loss and total comprehensive income
-
-
-
(465,498)
(465,498)
Balance at 31 December 2022
100
6,065,724
(5,928,729)
(1,014,765)
(877,670)
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
-
(1,339,390)
(1,339,390)
Issue of share capital
9
67
3,899,933
-
-
3,900,000
Balance at 31 December 2023
167
9,965,657
(5,928,729)
(2,354,155)
1,682,940
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
1
Accounting policies
Company information
Cognassist UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is RMT Accountants & Business Advisors Ltd, Gosforth Park Avenue, Newcastle upon Tyne, NE12 8EG.
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.
1.2
Going concern
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future. However, the directors are aware of certain material uncertainties which may cause doubt on the company's ability to continue as a going concern.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for 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.
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.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Fixtures and fittings
Straight line over 36 months
Computers
Straight line over 36 months
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).
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
1.6
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.
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.
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
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.
1.7
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.
1.8
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.
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 7 -
1.9
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, if considered material to the financial statements.
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.
1.10
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.11
Share-based payments
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted. 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, if considered material to the financial statements. A corresponding adjustment is made to equity. If the vesting period can not be predetermined then no expense is recognised until the options are exercised.
1.12
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.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
55
54
3
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(535,319)
(439,960)
Deferred tax
Origination and reversal of timing differences
(15,546)
(1,802)
Total tax credit
(550,865)
(441,762)
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
4
Tangible fixed assets
Fixtures and fittings
Computers
Total
£
£
£
Cost
At 1 January 2023
9,196
219,892
229,088
Additions
2,093
35,622
37,715
At 31 December 2023
11,289
255,514
266,803
Depreciation and impairment
At 1 January 2023
6,174
94,894
101,068
Depreciation charged in the year
2,734
81,186
83,920
At 31 December 2023
8,908
176,080
184,988
Carrying amount
At 31 December 2023
2,381
79,434
81,815
At 31 December 2022
3,022
124,998
128,020
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
411,444
477,062
Corporation tax recoverable
535,319
439,960
Other debtors
137,446
115,412
1,084,209
1,032,434
6
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans
247,519
224,057
Trade creditors
83,902
67,128
Taxation and social security
279,341
283,260
Other creditors
1,044,202
1,394,066
1,654,964
1,968,511
The interest on the bank loan is 10% per annum. Loans are secured with fixed charges over the assets of the company and repayable in instalments.
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
7
Creditors: amounts falling due after more than one year
2023
2022
£
£
Bank loans
249,597
497,116
The interest on the bank loan is 10% per annum. Loans are secured with fixed charges over the assets of the company and repayable in instalments.
8
Share-based payment transactions
The company operates an EMI share option plan.
The participating employees in the company have been granted options to acquire Ordinary A 0.0001p shares in the company at an exercise prices of 6p-12p per share. The options can only be exercised once specific criteria are met, and are subject to the terms stipulated in the EMI share option contract.
During the year 1,558,732 options were granted and none of which lapsed.
At the year end there have been 8,454,983 (2022 - 6,896,251) options granted to acquire Ordinary A 0.0001p shares, of which none have vested. The weighted average exercise price of options at year end was 7p (2022 - 6p).
9
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 0.0001p each
100,000,000
100,000,000
100
100
Ordinary B shares of 0.0001p each
33,361,134
-
34
-
133,361,134
100,000,000
134
100
2023
2022
2023
2022
Preference share capital
Number
Number
£
£
Issued and fully paid
B Preferred shares of 0.0001p each
33,361,134
-
33
-
Preference shares classified as equity
33
-
Total equity share capital
167
100
On 22 March 2023, 33,361,134 Ordinary B shares were issued of 0.0001p each along with 33,361,134 preference shares of 0.0001p each.
The Ordinary B shares issued has given rise to an increase in the share premium balance of £3,899,967 within the accounts as per the statement of changes in equity.
The B Preferred shares are redeemable at the option of the company and bear a fixed cumulative coupon of 8%, subject to specific terms included in the Articles.
COGNASSIST UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
10
Demerger reserve
2023
2022
£
£
At the beginning and end of the year
(5,928,729)
(5,928,729)
On 30 September 2020 E-Quality Learning Limited distributed the Cognassist trade and assets to Cognassist UK Limited and, as consideration of £6,065,823, Cognassist UK Limited issued 99 £1 ordinary shares to the common shareholder fully paid at a total premium of £6,065,724. The £5,928,729 excess of consideration over the net assets and liabilities acquired of £137,904 has been accounted for as a demerger reserve in equity.
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