REGISTERED NUMBER: |
Strategic Report, Directors' Report and |
Financial Statements for the Year Ended 31 December 2023 |
for |
Charme Capital Partners Limited |
REGISTERED NUMBER: |
Strategic Report, Directors' Report and |
Financial Statements for the Year Ended 31 December 2023 |
for |
Charme Capital Partners Limited |
Charme Capital Partners Limited (Registered number: 09487131) |
Contents of the Financial Statements |
for the Year Ended 31 December 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Directors' Report | 5 |
Report of the Independent Auditors | 7 |
Income Statement | 11 |
Statement of Other Comprehensive Income | 12 |
Statement of Financial Position | 13 |
Statement of Changes in Equity | 14 |
Statement of Cash Flows | 15 |
Notes to the Statement of Cash Flows | 16 |
Notes to the Financial Statements | 17 |
Charme Capital Partners Limited |
Company Information |
for the Year Ended 31 December 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
INDEPENDENT AUDITORS: |
9 Haymarket Square |
Edinburgh |
United Kingdom |
EH3 8RY |
Charme Capital Partners Limited (Registered number: 09487131) |
Strategic Report |
for the Year Ended 31 December 2023 |
The directors present their strategic report for the year ended 31 December 2023. |
REVIEW OF BUSINESS |
Charme Capital Partners Limited ("CCP" or the "Firm") is a duly Financial Conduct Authority ("FCA) authorized Investment Manager, who, as delegated discretionary investment manager in accordance with Article 20 of AIFMD, manages a portion of the Charme III and Charme IV Fund's portfolio of assets with a specific and exclusive role of investing in companies having their businesses outside of Italy. The Investment Manager is appointed until the liquidation of the Funds. |
The Firrn is authorised by the FCA as a MIFIDPRU investment firm and it does not have permission to hold client rnoney or assets, nor lends rnoney. |
Charme III is an Italian closed ended private equity fund (the "Fund"). The Fund is formed and managed by Charme Capital Partners SGR S.p.A. (the "AIFM") an Italian authorised investment fund manager duly authorised by the Bank of Italy, established in 2002. The Fund makes private equity and equity related investments in leading companies with growth and/or internationalization potential, having a size of €645 million. The fund is a contractual alternative investment fund ("AIF") for the purpose of the EU Alternative Investment Fund Managers Directive (2011/61/EC, "AIFMD"). In terms of investment strategy, the investment period ended with effect from 12 February 2021. The expiry of the Fund shall be in February 11, 2025. Moreover, the Fund could be extended for two additional years. |
Charme IV is an Italian closed ended private equity fund (the "Fund IV"). The Fund IV is formed and managed by the AIFM. Also the Fund IV makes private equity and equity related investments in leading companies with growth and/or internationalization potential, having a size of €813.0 million as of December 2023 and the Fund IV on February 28, 2023 closed the subscription period. The fund is a contractual alternative investment fund ("AIF") for the purpose of the EU Alternative Investment Fund Managers Directive (2011/61/EC, "AIFMD"). In terms of investment strategy, the investment period end with effect from 20 November 2025 and could be extended for 12 months. The expiry of the Fund shall be in November 20, 2030. |
The delegation represents the major source of income for CCP. The delegation activity is restricted to the following activities concerning the international (non-Italian) portfolio companies: |
- sourcing investment opportunities (or 'scouting'); |
- management of the acquisition; |
- monitoring investments; |
- forming potential exit strategies; and |
- managing the divestment. |
All acquisitions are performed by the Fund. The AIFM has certain duties to control the CCP's activities, make the capital calls from the Fund and retaining supervision over the discretionary portfolio management activities of CCP. CCP does not propose to launch or market any private equity funds; instead, it is a delegated discretionary portfolio manager that has been exclusively appointed to manage, on behalf of the Fund, its international investments in equity instruments. |
CCP structured itself in order to have two main teams dedicated to potential investments in the UK and in Spain which are the two main geographies. Therefore, during 2018 the Firm established a branch in Spain with an office in Madrid. The team monitored both the UK market and the Spanish market through its network of advisors and proprietary connections. |
In 2023 CCP looked for several potential acquisitions, monitored the portfolio of companies acquired through its sourcing and finalized a new investment in UK. The portfolio of both Funds as at December 2023 is formed by three companies based in the UK and three based in Spain. |
CCP shows a profit after taxes of £401,294 (2022: £533,896) and profits should remain stable for the next year. The Firm has adequate capital for its size and the complexity of its business based on current total capital of £3,377,624 (2022: £2,982,535 ) compared to a Minimum Capital Requirement of £1,254,822 (2022: £1,230,121) being the higher Permanent Minimum Capital Requirement and the Fixed Overheads Requirement. |
Charme Capital Partners Limited (Registered number: 09487131) |
Strategic Report |
for the Year Ended 31 December 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
Credit Risk |
The Firm neither holds client money nor assets nor lends money, and is, therefore, not exposed to Credit Risk in its traditional sense. The Firm's exposure to Credit Risk is the risk that investment management fees cannot be collected and the exposure to banks where revenue is deposited. The Firm's Credit Risk Appetite is low so the Firm holds all cash with banks assigned high credit ratings. |
Market Risk |
The Firm does not have a Trading Book. The only potential exposures are Non-Trading Book Exposures, i.e. to Foreign Currency held on deposit and assets or liabilities held in Foreign Currency, such as Debtors, on the Firm's Balance Sheet.The Firm's Market Risk is low considering the transactions recorded. |
Operational Risk |
The Firm undertakes robust risk identification and scoring exercises across the Firm, this Risk Appetite Statement translates into the acceptance of risks rated C or below. The Firm has established internal procedures and appropriate scoring mechanisms in order to identify potential operational risks. |
Business Risk |
The Firm has assessed Business Risks and set out appropriate actions to manage them. Business Risk is taken account of through the application of Scenario/Stress Testing. |
Liquidity Risk |
The Firm has in place Liquidity Systems and Controls which include the management of Liquidity Risk via scenario and stress testing of the Firm's Cash Flow Forecast and the establishment of management actions and contingency funding plans. |
SECTION 172(1) STATEMENT |
Section 172 of the Companies Act 2006 imposes a general duty on every Director to act in a way that they consider, in good faith, would be most likely to promote the success of the Firm for the benefit of its members as a whole and in doing so, to have regard to various other matters designed to ensure that boards consider the interests of other relevant stakeholders. |
The Directors of the Firm share a common purpose to deliver sustainable investment success for the benefit of clients, employees, society and the shareholder. |
A long term focus |
The Firm takes a long-term approach to its business that is aligned to its strategic priorities, corporate resources and risk appetite. |
Employee engagement |
The Directors consider the employees to be a key success factor for the Firm and this success is contingent on developing and maintaining an environment that creates and develops a diverse, high integrity, high performance culture. |
Highest Standards of Integrity and Conduct |
The Firm is regulated by the FCA and its permission to operate is conditional on appropriate expectations and standards of conduct. Conduct risk is considered by the Board in its capital planning and risk management program which includes stress and scenario analyses of risks to CCP. To ensure this risk is controlled and mitigated appropriately, the Board oversees a comprehensive program of regulatory compliance that is focused on the protection of clients' interests. |
Also the Company, by being FCA regulated, aims to keep his reputation by applying high standard of business conduct, in particular related to the organization's values, culture and ethical standard. |
Charme Capital Partners Limited (Registered number: 09487131) |
Strategic Report |
for the Year Ended 31 December 2023 |
KEY PERFORMANCE INDICATORS |
The Company's key performance indicators are considered to be turnover and profit or loss before taxation. Turnover for the period was £ 6,443,900 (2022: £ 7,639,400). The Company made a profit before taxation of £545,933 (2022: £ 676,745). |
The results and financial position for the financial year set out in the statement of comprehensive income and the statement of the financial position on pages 12 and 13 respectively. The directors do not anticipate any change in the nature of principal activities going forward and expect the Company to continue to benefit from enhanced business opportunities. |
GOING CONCERN |
The Company was profit making in the year, had net current assets and nets assets at the year end date. The financial statements have been prepared on a going concern basis which means the Company can be expected to meet its liabilities as the fall due for a period of at least 12 months from the date of signing these financial statements. In assessing the appropriateness of the going concern basis of preparation, the Directors have taken into account the key risk of the business as well as the Company's business model and availability of cash resources. |
FUTURE DEVELOPMENTS |
The directors expect the general level of activity to remain consistent with 2023 in the forthcoming year. This is as a result of the Firm maintaining in place the delegation agreement with the AIFM. |
As stated above, at present, the 2024 revenues should remain consistent with 2023 regardless of the impact of Ukraine and Israel-Gaza macro-economic environments due to the contractual nature of the management fees of the AIFM. |
Given the continued uncertainty associated with Ukraine and Israel-Gaza conflicts, the directors are monitoring the situation closely and the impact it may have on businesses and the Firm as a whole. The situation did not have any negative impact on the operating or financial performance of CCP. |
Also, the Director is planning to start raising a new fund and Charme Capital Partners Limited will still be the delegate investment manager, so promote the success of the company, remain one of the key objective for future developments. |
ON BEHALF OF THE BOARD: |
Charme Capital Partners Limited (Registered number: 09487131) |
Directors' Report |
for the Year Ended 31 December 2023 |
The directors present their report with the financial statements of the company for the year ended 31 December 2023. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 December 2023. |
FUTURE DEVELOPMENTS |
The directors expect the general level of activity to remain consistent with 2023 in the forthcoming year. This is as a result of the Firm maintaining in place the delegation agreement with the AIFM. |
As stated above, at present, the 2024 revenues should remain consistent with 2023 regardless of the impact of Ukraine and Israel-Gaza macro-economic environments due to the contractual nature of the management fees of the AIFM. |
Given the continued uncertainty associated with Ukraine and Israel-Gaza conflicts, the directors are monitoring the situation closely and the impact it may have on businesses and the Firm as a whole. The situation did not have any negative impact on the operating or financial performance of CCP. |
Also, the Director is planning to start raising a new fund and Charme Capital Partners Limited will still be the delegate investment manager, so promote the success of the company, remain one of the key objective for future developments. |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report. |
POLITICAL DONATIONS AND EXPENDITURE |
No political donations were made during the year. |
OVERSEAS BRANCHES |
The company operates a branch in Spain with office in Madrid. |
QUALIFYING INDEMNITY PROVISION |
The Company has made qualifying third-party indemnity provisions for the benefit of its directors which were made during the year and remain in force at the date of this report. |
GOING CONCERN |
The Company was profit making in the year, had net current assets and nets assets at the year end date. The financial statements have been prepared on a going concern basis which means the Company can be expected to meet its liabilities as the fall due for a period of at least 12 months from the date of signing these financial statements. In assessing the appropriateness of the going concern basis of preparation, the Directors have taken into account the key risk of the business as well as the Company's business model and availability of cash resources. |
DISCLOSURE IN THE STRATEGIC REPORT |
The following disclosures are required to be made in the directors' report but instead, have been included in the strategic report: |
- information on exposure to credit risk, liquidity risk, market risk and other risks applicable to the Company; |
- financial risk management objectives and policies; and |
- likely future developments of the Company. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
Charme Capital Partners Limited (Registered number: 09487131) |
Directors' Report |
for the Year Ended 31 December 2023 |
STATEMENT OF DIRECTORS' RESPONSIBILITIES - continued |
|
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
Each of the persons who is a director at the date of approval of this report confirms that: |
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and |
- they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. |
This information is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006. |
Deloitte LLP is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Charme Capital Partners Limited |
Opinion |
We have audited the financial statements which comprise: |
- the income statement; |
- the statement of other comprehensive income; |
- the statement of financial position; |
- the statement of changes in equity; |
- the statement of cash flows; |
- the notes to the statement of cash flow; and |
-the related notes 1 to 19. |
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 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 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 Financial Reporting Council's (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 opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. |
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. |
We have nothing to report in this regard. |
Report of the Independent Auditors to the Members of |
Charme Capital Partners Limited |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements. |
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 any material misstatements in the strategic report or the directors' report. |
Matters on which we are required to report by exception |
Under the Companies Act 2006 we are required to report in respect of the following matters if, in our opinion: |
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- the financial statements are not in agreement with the accounting records and returns; or |
- certain disclosures of directors' remuneration specified by law are not made; or |
- we have not received all the information and explanations we require for our audit. |
We have nothing to report in respect of these matters. |
Responsibilities of directors |
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
Report of the Independent Auditors to the Members of |
Charme Capital Partners Limited |
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 auditor's 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. |
Extent to which the audit was considered capable of detecting irregularities, including fraud. |
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. |
We considered the nature of the company's industry and its control environment, and reviewed the company's documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management and the directors about their own identification and assessment of the risks of irregularities, including those that are specific to the company's business sector |
We obtained an understanding of the legal and regulatory framework that the company operates in, and identified the key laws and regulations that: |
- had a direct effect on the determination of material amounts and disclosures in the financial statements. These included the UK Companies Act and relevant tax legislation; and |
- do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid a material penalty. These included the company's regulatory solvency requirements, requirements of the Financial Conduct Authority (FCA) and the Financial Services and Markets Act 2000. |
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements. |
As a result of performing the above, we identified the greatest potential for fraud in the recognition of revenue area, and our procedures performed to address it are described below. |
We reviewed the relevant contractual agreements between the company and relevant third parties, and substantively tested the revenue amounts derived from these contracts by tracing recorded revenue to invoices and to subsequent cash receipts. In addition, we tested management's cost plus calculations by agreeing key inputs to the transfer pricing agreement. |
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business. |
In addition to the above, our procedures to respond to the risks identified included the following: |
- reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements; |
- performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; |
- enquiring of management concerning actual and potential litigation and claims, and instances of non-compliance with laws and regulations; and |
- reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC and FCA. |
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 Report of the Auditors. |
Report of the Independent Auditors to the Members of |
Charme Capital Partners Limited |
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 2006. Our 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 auditor's 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. |
for and on behalf of |
9 Haymarket Square |
Edinburgh |
United Kingdom |
EH3 8RY |
Charme Capital Partners Limited (Registered number: 09487131) |
Income Statement |
for the Year Ended 31 December 2023 |
2023 | 2022 |
Notes | £ | £ |
TURNOVER | 5 |
Administrative expenses |
OPERATING PROFIT | 8 |
Interest receivable and similar income |
PROFIT BEFORE TAXATION |
Tax on profit | 10 |
PROFIT FOR THE FINANCIAL YEAR |
Charme Capital Partners Limited (Registered number: 09487131) |
Statement of Other Comprehensive Income |
for the Year Ended 31 December 2023 |
2023 | 2022 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME |
Forex retranslation reserves | ( | ) |
Income tax relating to other comprehensive income |
OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX | ( | ) |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
Charme Capital Partners Limited (Registered number: 09487131) |
Statement of Financial Position |
31 December 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
CURRENT ASSETS |
Debtors | 12 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 16 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 17 |
Retained earnings |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Charme Capital Partners Limited (Registered number: 09487131) |
Statement of Changes in Equity |
for the Year Ended 31 December 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 January 2022 |
Changes in equity |
Profit for the year | - | 533,896 | 533,896 |
Other comprehensive income | - | 13,508 | 13,508 |
Total comprehensive income | - |
Balance at 31 December 2022 |
Changes in equity |
Profit for the year | - | 401,294 | 401,294 |
Other comprehensive income | - | (6,205 | ) | (6,205 | ) |
Total comprehensive income | - |
Balance at 31 December 2023 |
Charme Capital Partners Limited (Registered number: 09487131) |
Statement of Cash Flows |
for the Year Ended 31 December 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Accrued income | ( | ) |
Other operating cash flow adjustment | ( | ) |
Tax paid | ( | ) | ( | ) |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( | ) | ( | ) |
Interest received |
Net cash from investing activities | ( | ) | ( | ) |
Increase in cash and cash equivalents |
Cash and cash equivalents at beginning of year | 2 | 860,036 |
Cash and cash equivalents at end of year | 2 | 1,773,742 | 1,513,540 |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Statement of Cash Flows |
for the Year Ended 31 December 2023 |
1. | RECONCILIATION OF PROFIT FOR THE FINANCIAL YEAR TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
£ | £ |
Profit for the financial year |
Depreciation charges |
Finance income | (21 | ) | - |
Taxation |
591,366 | 724,058 |
Decrease/(increase) in trade and other debtors | ( | ) |
(Decrease)/increase in trade and other creditors | ( | ) |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts: |
Year ended 31 December 2023 |
31.12.23 | 1.1.23 |
£ | £ |
Cash and cash equivalents | 1,773,742 | 1,513,540 |
Year ended 31 December 2022 |
31.12.22 | 1.1.22 |
£ | £ |
Cash and cash equivalents | 1,513,540 | 860,036 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.1.23 | Cash flow | At 31.12.23 |
£ | £ | £ |
Net cash |
Cash at bank | 1,513,540 | 260,202 | 1,773,742 |
1,513,540 | 1,773,742 |
Debt |
Debts falling due within 1 year | (100,000 | ) | - | (100,000 | ) |
(100,000 | ) | - | (100,000 | ) |
Total | 1,413,540 | 260,202 | 1,673,742 |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements |
for the Year Ended 31 December 2023 |
1. | GENERAL INFORMATION |
Charme Capital Partners Limited is a company incorporated in the United Kingdom under the Companies Act 2006. The company is a private company limited by shares, registered in England and Wales. The address of the registered office is 7th Floor, 3 St. James's Square, London, England, SW1Y 4JU |
2. | STATEMENT OF COMPLIANCE |
3. | ACCOUNTING POLICIES |
Basis of preparation |
The financial statements have been prepared under the historical cost basis, and in accordance with Financial Reporting Standard 102 (FRS102) "The Financial Reporting Standard Applicable in the UK and Republic of Ireland", issued by the Financial Reporting Council. |
Going concern |
Having given due consideration to the impact of Ukraine and Israel-Gaza conflicts on the business, as set out in the Strategic Report and Directors' Report on pages 1-6, and the financial resources available, the directors continue to prepare the financial statements on the going concern basis. |
The Company was profit making in the year, had net current assets and nets assets at the year end date. The financial statements have been prepared on a going concern basis which means the Company can be expected to meet its liabilities as the fall due for a period of at least 12 months from the date of signing these financial statements. In assessing the appropriateness of the going concern basis of preparation, the Directors have taken into account the key risk of the business as well as the Company's business model and availability of cash resources. |
The financial statements are prepared in pound, which is the functional currency of the entity. |
Revenue recognition |
Turnover is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods supplied and services rendered, stated net of discounts and of Value Added Tax. |
Revenue from the rendering of services is measured by reference to the stage of completion of the service transaction at the end of the reporting period provided that the outcome can be reliably estimated. When the outcome cannot be reliably estimated, revenue is recognised only to the extent that it is probable the expenses recognised will be recovered. |
Tangible fixed assets |
Fixed assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. |
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows: |
Leasehold property improvements - straight line over the lease term |
Fixture and fittings - straight line over the lease term |
Office equipment - straight line over three years |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
Financial instruments |
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument. |
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. |
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. |
Financial assets and liabilities are only offset in the statement of financial position when, and only when there exists a legally enforceable right to set off the recognised amounts and the Company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. |
Financial assets are derecognised when and only when a) the contractual rights to the cash flows from the financial asset expire or are settled, b) the Company transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or c) the Company, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party. |
Financial liabilities are derecognised only when the obligation specified in the contract is discharged, cancelled or expires. |
Taxation |
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. |
Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date. |
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
Foreign currencies |
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account. |
Defined contribution plans |
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. |
When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises. |
Cash and cash equivalents |
Cash and cash equivalents include cash in hand, deposit s held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less when acquired that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. |
Operating lease |
Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similar spread on a straight-line basis over the lease term. |
4. | JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
In the application of the Company's accounting policies, which are described in note 3, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. |
There are no critical judgements and key estimation uncertainty that the directors have made in the process of applying the Company's accounting policies and that have the most significant effect on the amounts recognised in the financial statements. |
5. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by class of business is given below: |
2023 | 2022 |
£ | £ |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
6. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Administrative staff | 4 | 2 |
Management staff | 9 | 8 |
7. | DIRECTORS' EMOLUMENTS |
2023 | 2022 |
£ | £ |
Directors' remuneration |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Information regarding the highest paid director is as follows: |
2023 | 2022 |
£ | £ |
Emoluments etc |
8. | OPERATING PROFIT |
The operating profit is stated after charging: |
2023 | 2022 |
£ | £ |
Depreciation - owned assets |
Foreign exchange differences |
9. | AUDITORS' REMUNERATION |
2023 | 2022 |
£ | £ |
Fees payable to the company's auditors for the audit of the company's financial statements | 38,000 | 38,670 |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
10. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax | ( | ) |
Tax on profit |
UK corporation tax has been charged at 23.50% (2022 - 19%). |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Depreciation in excess of capital allowances |
Unrelieved foreign tax |
Other tax adjustments to increase (decrease) tax liability |
Total tax charge | 144,639 | 142,849 |
Tax effects relating to effects of other comprehensive income |
2023 |
Gross | Tax | Net |
£ | £ | £ |
Forex retranslation reserves | ( | ) | - | (6,205 | ) |
2022 |
Gross | Tax | Net |
£ | £ | £ |
Forex retranslation reserves | - | 13,508 |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
10. | TAXATION - continued |
Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statements. |
Deferred tax assets arise as a result of temporary differences, where the time at which profits and losses are recognised for tax purposes differs from the time at which the relevant transaction is recorded in the accounts. A deferred tax asset represents a tax reduction that is expected to arise in a future period. Deferred tax assets are measured at the tax rates that are expected to apply to the period when the asset is realised based on the tax rates that have been enacted at the year-end date. |
The Company was profitable in 2023 and 2022 and based on its forecasts and projections it is considered sufficiently probable that it will generate sufficient taxable profits in the foreseeable future against which these temporary differences can be fully utilised. |
11. | TANGIBLE FIXED ASSETS |
Fixtures |
Long | and | Computer |
leasehold | fittings | equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 January 2023 |
Additions |
Reclassification/transfer | ( | ) | ( | ) | ( | ) |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
Reclassification/transfer | ( | ) | ( | ) | ( | ) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade debtors |
Other debtors |
Prepayments and accrued income |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Debentures (see note 14) |
Trade creditors |
Corporation Tax |
Social security and other taxes |
Other creditors |
Accruals and deferred income |
14. | LOANS |
An analysis of the maturity of loans is given below: |
2023 | 2022 |
£ | £ |
Amounts falling due within one year or on demand: |
Shareholders' loan | 100,000 | 100,000 |
15. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
16. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
£ | £ |
Deferred tax |
Accelerated capital allowances |
Deferred |
tax |
£ |
Balance at 1 January 2023 |
Charge to Income Statement during year |
Balance at 31 December 2023 |
17. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary | 1 | 1,326,000 | 1,326,000 |
Charme Capital Partners Limited (Registered number: 09487131) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
18. | RELATED PARTY DISCLOSURES |
Amounts owed to related parties include a loan from the sole shareholder of the Company. The loan is unsecured and repayable on 31 December 2024. No interest is due on the loan. Details of the amount is disclosed in note 14. |
Management fees are received from a company owned by Mr Cordero di Montezernolo. The fees are determined based on a cost plus basis, in line with the transfer pricing arrangement. |
Current year management fees amount to £6,037,642 (2022: £6,318,290) The outstanding balance at year end was £1,826,480 (2022: £1,892,052) |
Directors remuneration has been disclosed on note 7 to the accounts. The outstanding balance due to the directors at year end is equal to £10,000. The outstanding balance at the date of the approval of Financial Statements is nil. |
19. | EVENTS AFTER THE END OF THE REPORTING PERIOD |
There have been no post balance sheet events. |
20. | ULTIMATE CONTROLLING PARTY |
The company was under the control of Mr. Matteo Cordero Di Montezemolo, sole shareholder of the company throughout the current period. |