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Registered number: 05131113














ELM CAPITAL ASSOCIATES LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED  31 DECEMBER 2023

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
COMPANY INFORMATION


Director
E Deshormes 




Registered number
05131113



Registered office
Southwest House
11a Regent Street

London

SW1Y 4LR




Independent auditors
Sopher + Co LLP
Chartered Accountants & Statutory Auditors

5 Elstree Gate

Elstree Way

Borehamwood

Hertfordshire

WD6 1JD





 
ELM CAPITAL ASSOCIATES LIMITED
 

CONTENTS



Page
Strategic Report
 
1 - 2
Director's Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Statement of Comprehensive Income
 
9
Statement of Financial Position
 
10
Statement of Changes in Equity
 
11
Notes to the Financial Statements
 
12 - 24


 
ELM CAPITAL ASSOCIATES LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The Company specialises in advising private equity funds and private equity investors.  Its two main businesses are to assist General Partners in their fundraising activities and to provide advisory services for the secondary sales of private equity funds, companies, portfolios of funds and portfolios of companies.

Business review
 
In the current year, the Company reported profit before tax of £108,057 (2022 - loss before tax of £1,217,797).
Intermediation, advisory and placement fees of £3,923,921 (2022 - £1,748,595) have been generated in the year to 31 December 2023.
The results for the year and the financial position at the year-end were considered satisfactory by the directors who expect growth in the foreseeable future.

Principal risks and uncertainties
 
The main risks facing the Company remain market risk, operational risk and regulatory risk.  Market risk remains the most important as adverse market conditions will undermine the search of investors for new funds.  The directors have the ability and the know how to diversify the business.  The main operational risk involves E Deshormes being incapacitated. The Company employs adequately skilled professionals to carry out the business.  The regulatory risk facing the Company is minimal as the Company has employed external regulatory consultants to periodically review its regulatory compliance and provide regulatory advice where necessary.

Financial key performance indicators
 
Given the straightforward nature of the business, the Company's directors are of the opinion that any further analysis using KPIs is not necessary for an understanding of the development, performance or position of the business. 

Remuneration Code
 
In accordance with the rules of the Financial Conduct Authority, the Company has made available information on
its Remuneration Code. This information is available on request of the Company.

Page 1

 
ELM CAPITAL ASSOCIATES LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Director's statement of compliance with duty to promote the success of the Group
 
The Director of Elm Capital Associates Limited consider that they have acted in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole (having regard to the stakeholders and matters set out in S172(1)(a-f) of the Act) in the decisions taken during the financial year ended 31 December 2023.
Consideration of long-term consequences are an inherent part of the Company's decision-making processes. As a privately-owned Company, the director considers that the interests of the Company and its shareholder are aligned in seeking sustainable value creation over the longer term through it's operations, promoting long term strategic decision-making. These factors also drive a continuing focus on the maintenance of durable relationships with stakeholders, built on the Company's reputation with clients and suppliers.
The Company is regulated by the Financial Conduct Authority in the conduct of it's advisory services and must do so in good faith and with due diligence.
The Company operates in a sector characterised by long term relationships with stakeholders. Maintaining a reputation for high standards of business conduct is vital and the Company expects all members of the supply chain to always act with integrity, acting openly, honestly and ethically. The Company has zero tolerance to fraud and consistently maintains effective oversight and scrutiny processes, executed with independence and impartiality. Integrity is underpinned with policies in relation to bribery and corruption, data protection, equality, diversity and inclusion, modern slavery, fraud and whistleblowing, each of which is reinforced through appropriate measures.


This report was approved by the board on 22 April 2024 and signed on its behalf.



E Deshormes
Director

Page 2

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The Director presents his report and the financial statements for the year ended 31 December 2023.

Director's responsibilities statement

The Director is responsible for preparing the Strategic Report, the Director's Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the Director to prepare financial statements for each financial year. Under that law the Director has elected to prepare the financial statements in accordance with 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 Director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the Director is required to:


select suitable accounting policies 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 Director is responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable him to ensure that the financial statements comply with the Companies Act 2006He is also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation, amounted to £111,052 (2022 - loss £1,084,633).

Dividends amounting to £24,000 (2022 - £Nil) were issued during the year.

Director

The Director who served during the year was:

E Deshormes 

Future developments

There are no plans which will significanty change the activities and risks of the Company.

Engagement with employees

The Company has continued throughout the year to provide employees with relevant information and to seek their views on matters of common concern. Priority is given to ensuring that employees are aware of all significant matters affecting the Company's performance and of any significant organisational changes.

Page 3

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Engagement with suppliers, customers and others

The Company does not conform to any code or standard regarding payment practice. However, it is the Company's policy to settle the terms of payment with suppliers when business is agreed, to ensure that suppliers are made aware of them and to pay invoices in accordance with these terms.

Disclosure of information to auditors

The Director at the time when this Director's Report is approved has confirmed that:
 
so far as he is aware, there is no relevant audit information of which the Company's auditors are unaware, and

he 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

There have been no significant events affecting the Company since the year end.

Auditors

Under section 487(2) of the Companies Act 2006Sopher + Co LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

This report was approved by the board on 22 April 2024 and signed on its behalf.
 





E Deshormes
Director

Page 4

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ELM CAPITAL ASSOCIATES LIMITED
 

Opinion


We have audited the financial statements of Elm Capital Associates Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, 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 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 Director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the Director with respect to going concern are described in the relevant sections of this report.


Page 5

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ELM CAPITAL ASSOCIATES LIMITED (CONTINUED)

Other information


The Director is responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditors' Report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.


In connection with our audit of the financial statementsour responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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 Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Director's 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 Director's 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 Director's remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Director's Responsibilities Statement set out on page 3, the Director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Director determines 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 Director is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Director either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 6

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ELM CAPITAL ASSOCIATES LIMITED (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:

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

We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: 
 
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; 
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and 
understanding the design of the Company’s remuneration policies. 

To address the risk of fraud through management bias and override of controls, we: 
 
performed analytical procedures to identify any unusual or unexpected relationships; 
tested journal entries to identify unusual transactions; 
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and 
investigated the rationale behind significant or unusual transactions. 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: 
 
agreeing financial statement disclosures to underlying supporting documentation; 
reading the minutes of meetings of those charged with governance; 
enquiring of management as to actual and potential litigation and claims; and 
reviewing correspondence with HMRC, relevant regulators and the Company’s legal advisors. 
Page 7

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ELM CAPITAL ASSOCIATES LIMITED (CONTINUED)


There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. 
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.


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.


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.





Sean Brennan FCCA (Senior Statutory Auditor)
  
for and on behalf of
Sopher + Co LLP
 
Chartered Accountants
Statutory Auditors
  
5 Elstree Gate
Elstree Way
Borehamwood
Hertfordshire
WD6 1JD

22 April 2024
Page 8

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
3,923,921
1,748,595

Cost of sales
  
(126,438)
(123,803)

Gross profit
  
3,797,483
1,624,792

Administrative expenses
  
(3,547,944)
(2,784,209)

Operating profit/(loss)
 5 
249,539
(1,159,417)

Interest receivable and similar income
 10 
6,586
1,073

Interest payable and similar expenses
 11 
(146,966)
(59,453)

Profit/(loss) before tax
  
109,159
(1,217,797)

Tax on profit/(loss)
 12 
1,893
133,164

Profit/(loss) for the financial year
  
111,052
(1,084,633)

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 12 to 24 form part of these financial statements.

Page 9

 
ELM CAPITAL ASSOCIATES LIMITED
REGISTERED NUMBER:05131113

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 14 
26,309
48,675

Current assets
  

Debtors: amounts falling due after more than one year
 15 
-
94,838

Debtors: amounts falling due within one year
 15 
2,864,982
1,801,129

Bank and cash balances
  
28,039
275,335

  
2,893,021
2,171,302

Current liabilities
  

Creditors: amounts falling due within one year
 16 
(2,383,329)
(1,771,028)

Net current assets
  
 
 
509,692
 
 
400,274

  

Net assets
  
536,001
448,949


Capital and reserves
  

Called up share capital 
 18 
201,000
201,000

Profit and loss account
 19 
335,001
247,949

  
536,001
448,949


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 22 April 2024.




E Deshormes
Director

The notes on pages 12 to 24 form part of these financial statements.

Page 10

 
ELM CAPITAL ASSOCIATES LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2023
201,000
247,949
448,949



Profit for the year
-
111,052
111,052

Dividends: Equity capital
-
(24,000)
(24,000)


At 31 December 2023
201,000
335,001
536,001



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


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2022
201,000
1,332,582
1,533,582



Loss for the year
-
(1,084,633)
(1,084,633)


At 31 December 2022
201,000
247,949
448,949


The notes on pages 12 to 24 form part of these financial statements.

Page 11

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Elm Capital Associates Limited is a Limited Company incorporated and domiciled in England and Wales, with its registered office address at 7th Floor, Southwest House 11a Regent Street, London, SW1Y 4LR. 
The principal activity of the Company was that of investment advisory services.   

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

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d).

This information is included in the consolidated financial statements of Elm Capital Holding Limited as at 31 December 2022 and these financial statements may be obtained from Companies House.

 
2.3

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Page 12

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Revenue

Turnover comprises revenue recognised by the company in respect of services supplied during the year, exclusive of Value Added Tax.
Revenue is recognised as per the terms defined in the service agreements.

 
2.5

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Interest income

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

 
2.7

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.

 
2.8

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

Page 13

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. 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.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.10

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Page 14

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.10
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives,  The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of comprehensive income.

Depreciation is provided on the following basis

Short-term leasehold property
-
Over the term of the lease
Fixtures and fittings
-
20% - 33% straight line basis

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.11

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.12

Financial instruments

Basic financial instruments include trade and other debtors, trade and other creditors, cash and bank
balances.
Trade debtors, other debtors and loans to related parties are recognised initially at the transaction price less attributable transaction costs. Trade creditors, other creditors and loans from related parties are recognised initially at transaction price plus attributable transaction costs. Subsequently they are measured at amortised cost using the effective interest method, less any impairment losses in the case of trade and other debtors, and loans to related parties.
Interest bearing borrowings, such bank loans, classified as basic financial instruments are recognised initially at the present value of future payments discounted at a market rate of interest. Thereafter they are stated at amortised cost using the effective interest method. 
Cash and cash equivalents comprise cash balances and call deposits. 

 
2.13

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

Page 15

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Preparation of the financial statements requires management to make significant judgments and estimates. The items in the financial statements where these judgments and estimates have been made include:
Property, plant and equipment - are depreciated over their useful life taking into account, where appropriate, residual values. Assessment of useful lives and residual values are performed annually, taking into account factors such as economic viability and expected future financial performance of the asset. In assessing the residual values, the remaining life of the asset, its projected disposal value and future market conditions are taken into account.


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Intermediation fees
1,598,226
888,193

Placement fees
2,325,695
810,402

Advisory fees
-
50,000

3,923,921
1,748,595


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
164,540
162,500

Rest of Europe
3,632,943
1,457,623

Rest of the world
126,438
128,472

3,923,921
1,748,595



5.


Operating profit/(loss)

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

2023
2022
£
£

Depreciation of tangible fixed assets
26,489
47,562

Exchange differences
25,893
(37,245)

Other operating lease rentals
398,876
405,350

Defined contribution pension cost
85,419
76,606

Page 16

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Auditors' remuneration

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


2023
2022
£
£

Fees payable to the Company's auditors and their associates for the audit of the Company's financial statements
44,585
32,161


7.


Employees

Staff costs, including Director's remuneration, were as follows:


2023
2022
£
£

Wages and salaries
1,732,935
1,482,842

Social security costs
251,373
225,052

Cost of defined contribution scheme
85,419
76,606

2,069,727
1,784,500


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


        2023
        2022
            No.
            No.







Administration
13
12



Director
1
1

14
13


8.


Director's remuneration

2023
2022
£
£

Director's emoluments
181,559
179,590



9.


Key management compensation

Key management is made up solely of the Director and compensation paid to him during the year totalled £181,559 (2022 - £179,590). 

Page 17

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Interest receivable

2023
2022
£
£


Other interest receivable
6,586
1,073


11.


Interest payable and similar expenses

2023
2022
£
£


Other loan interest payable
145,153
59,453

Other interest payable
1,813
-

146,966
59,453


12.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
-
(128,287)


Deferred tax


Origination and reversal of timing differences
(1,893)
(4,877)


Taxation on loss on ordinary activities
(1,893)
(133,164)
Page 18

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
12.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - higher than) the standard rate of corporation tax in the UK of 19% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit/(loss) on ordinary activities before tax
109,159
(1,217,797)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
20,740
(231,381)

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
1,231
8,107

Capital allowances for year in excess of depreciation
2,029
4,383

Utilisation of tax losses
(24,000)
-

Book profit on chargeable assets
-
46

Unrelieved tax losses carried forward
-
87,475

Deferred tax
(1,893)
(4,877)

Group relief
-
3,083

Total tax charge for the year
(1,893)
(133,164)


Factors that may affect future tax charges

The Company has £334,081 (2022- £464,533) of taxable losses available to use against future trading profits.


13.


Dividends

2023
2022
£
£


Preference dividends
24,000
-

Page 19

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Tangible fixed assets





Short-term leasehold property
Fixtures and fittings
Total

£
£
£



Cost or valuation


At 1 January 2023
170,736
128,367
299,103


Additions
-
4,124
4,124



At 31 December 2023

170,736
132,491
303,227



Depreciation


At 1 January 2023
152,341
98,087
250,428


Charge for the year on owned assets
-
8,769
8,769


Charge for the year on financed assets
17,721
-
17,721



At 31 December 2023

170,062
106,856
276,918



Net book value



At 31 December 2023
674
25,635
26,309



At 31 December 2022
18,395
30,280
48,675




The net book value of land and buildings may be further analysed as follows:


2023
2022
£
£

Short leasehold
674
18,395


Page 20

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Debtors

2023
2022
£
£

Due after more than one year

Trade debtors
-
94,838


2023
2022
£
£

Due within one year

Trade debtors
2,462,963
1,205,299

Other debtors
274,361
467,662

Prepayments and accrued income
122,680
125,083

Deferred taxation
4,978
3,085

2,864,982
1,801,129



16.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
158,958
13,872

Amounts owed to group undertakings
34,179
6,919

Other taxation and social security
10,867
191,059

Other creditors
1,879,924
1,397,370

Accruals and deferred income
299,401
161,808

2,383,329
1,771,028


Included within other creditors is a loan from a Director. The balance subsisting at the year end is £1,829,800 (2022: £1,376,621) and is repayable on demand. Interest of £145,153 (2022: £26,621) has been accrued in the period, of which £91,973 (2022: £nil) has been paid to the Director in the period.


17.


Deferred taxation




2023


£






At beginning of year
3,085


Charged to profit or loss
1,893



At end of year
4,978

Page 21

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
17.Deferred taxation (continued)

The deferred tax asset is made up as follows:

2023
2022
£
£


Accelerated capital allowances
4,978
3,085


18.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



200,000 (2022 - 200,000) Preference shares of £1 each
200,000
200,000
1,000 (2022 - 1,000) Ordinary shares of £1 each
1,000
1,000

201,000

201,000



19.


Reserves

Profit and loss account

The profit and loss reserve contains the cumulative balance of retained profit and losses since the Company started trading. It is a distributable reserve.


20.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company  in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £85,419 (2022 - £76,606).


21.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
284,472
284,472

Later than 1 year and not later than 5 years
1,009,417
1,137,888

Later than 5 years
-
156,001

1,293,889
1,578,361

Page 22

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

22.


MIFIDPRU 8 disclosure

Introduction
The Financial Conduct Authority (“FCA” or “regulator”) in the Prudential sourcebook for MiFID Investment Firms in the FCA Handbook (“MIFIDPRU”) sets out the detailed prudential requirements that apply to Elm Capital (the “Firm”). Chapter 8 of MIFIDPRU (“MIFIDPRU 8”) sets out public disclosure rules and guidance with which the Firm must comply, further to those prudential requirements.
The Firm is classified under MIFIDPRU as a small and non-interconnected MIFIDPRU investment firm (“SNI MIFIDPRU Investment Firm”). As such, the Firm is required by MIFIDPRU 8 to disclose information regarding its remuneration policy and practices.
The purpose of these disclosures is to give stakeholders and market participants an insight into the Firm’s culture and to assist stakeholders in making more informed decisions about their relationship with the Firm.
This document has been prepared by the Firm in accordance with the requirements of MIFIDPRU 8 and is verified by the Governing Body. Unless otherwise stated, all figures are as at the Firm’s financial year-end.
Remuneration Policy and Practices
Overview
As an SNI MIFIDPRU Investment Firm, the Firm is subject to the basic requirements of the MIFIDPRU Remuneration Code (as laid down in Chapter 19G of the Senior management arrangements, Systems and Controls sourcebook in the FCA Handbook (“SYSC”)). The purpose of the remuneration requirements is to:
 
promote effective risk management in the long-term interests of the Firm and its clients;
ensure alignment between risk and individual reward;
support positive behaviours and healthy firm cultures; and
discourage behaviours that can lead to misconduct and poor customer outcomes.


The objective of the Firm’s remuneration policies and practices is to establish, implement and maintain a
culture that is consistent with, and promotes, sound and effective risk management and does not
encourage risk-taking which is inconsistent with the risk profile of the Firm and the services that it provides
to its clients.

In addition, the Firm recognises that remuneration is a key component in how the Firm attracts, motivates, and retains quality staff and sustains consistently high levels of performance, productivity, and results. As such, the Firm’s remuneration philosophy is also grounded in the belief that its people are the most important asset and provide its greatest competitive advantage.

The Firm is committed to excellence, teamwork, ethical behaviour, and the pursuit of exceptional outcomes for its clients. From a remuneration perspective, this means that performance is determined through the assessment of various factors that relate to these values, and by making considered and informed decisions that reward effort, attitude, and results.
Characteristics of the Firm’s Remuneration Policy and Practices
Remuneration at the Firm is made up of fixed and variable components. The fixed component is set in line with market competitiveness at a level to attract and retain skilled staff. Variable remuneration is paid on a discretionary basis and takes into consideration the Firm’s financial performance as well as the and nonfinancial performance of staff members in contributing to the Firm’s success. All staff members are
 
Page 23

 
ELM CAPITAL ASSOCIATES LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
eligible to receive variable remuneration.
The below table summarises the financial and non-financial criteria of performance used across the Firm in assessing the level of variable remuneration to be paid:
 


Financial Performance Criteria
Non-financial Performance Criteria

Firm
Profitability
Liquidity
Client retention and churn
Client experience

Individual

Met objectives
Client feedback


The fixed and variable components of remuneration are appropriately balanced: the fixed component represents a sufficient proportion of the total remuneration to enable the operation of a fully flexible policy on variable remuneration. This allows for the possibility of paying no variable remuneration component, which the Firm would do in certain situations, such as where the Firm’s profitability performance is constrained, or where there is a risk that the Firm may not be able to meet its capital or liquidity regulatory requirements.
Governance and Oversight
The Senior Management Team is responsible for setting and overseeing the implementation of The Firm’s remuneration policy and practices. In order to fulfil its responsibilities, the Senior Management Team: 

Is appropriately staffed to enable it to exercise competent and independent judgment on remuneration policies and practices and the incentives created for managing risk, capital, and liquidity.
Prepares decisions regarding remuneration, including decisions that have implications for the risk and risk management of the Firm.
Ensures that the Firm’s remuneration policy and practices take into account the public interest and the long-term interests of shareholders and other stakeholders in the Firm.
Ensures that the overall remuneration policy is consistent with the business strategy, objectives, values, and interests of the Firm and of its clients.

The Firm’s remuneration policy and practices are reviewed annually by the Senior Management Team.
Quantitative Remuneration Disclosure
For the financial year ended 31st December 2023 the total amount of remuneration awarded to all staff was £1,732,935 of which £1,332,935 comprised the fixed component of remuneration, and £400,000  comprised the variable component. For these purposes, ‘staff’ is defined broadly, and includes, for example, employees of the Firm itself and directors.

23.


Controlling party

The ultimate controlling party is the director E Deshormes by virtue of his shareholding in the parent company, Elm Capital Holding Limited.

 
Page 24