Registered number: 11103959 (England and Wales)
PLAID FINANCIAL LTD.
DIRECTORS' REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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COMPANY INFORMATION
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ZEDRA Corporate Reporting Services (UK) Limited
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CONTENTS
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Notes to the Financial Statements
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PLAID FINANCIAL LTD.
REGISTERED NUMBER:11103959
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BALANCE SHEET
AS AT 31 DECEMBER 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Provisions for liabilities
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PLAID FINANCIAL LTD.
REGISTERED NUMBER:11103959
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BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023
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Capital contribution reserve
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The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 3 to 10 form part of these financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The Company is in a net asset position of £1,409,709 primarily supported by cash at bank and an intercompany loan balance owed by a fellow subsidiary, Plaid B.V. Despite this position, due to the Company's business model being predominantly a transfer pricing arrangement with the ultimate parent company, Plaid, Inc., the Company is reliant upon continued support of the parent company in order to remain a going concern.
The Company has received written confirmation from its ultimate parent company that it will continue to provide financial support to the Company for a period of at least 12 months from the date of signing these financial statements. For this reason, the directors continue to adopt the going concern basis in preparing the financial statements.
The following principal accounting policies have been applied:
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:
Rendering of services
Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the contract when all of the following conditions are satisfied:
∙the amount of turnover can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the costs incurred and the costs to complete the contract can be measured reliably.
Intercompany turnover
Intercompany turnover is recognised on an operating profit margin of 2% and a cost plus 5% (for general, administrative and support services) and 7% (for development costs) basis, in line with the intercompany service agreement with the parent company. Intercompany turnover is recognised as the associated costs are incurred.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies (continued)
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Foreign currency translation
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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.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
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.
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 Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies (continued)
Where Restricted Stock Units (RSU) are awarded to employees, the fair value of the RSUs at the date of grant is charged to profit or loss over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each Balance Sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of RSUs that actually vest. Market vesting conditions are factored into the fair value of the RSUs granted. The cumulative expense is not adjusted for failure to achieve a certain market conditions.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as target based on an index) or factors which are within the control of one or other of the parties (such as the Company keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where the terms and conditions of RSUs are modified before they vest, the increase in fair value of the RSUs, measured immediately before and after the modification, is also charged to profit and loss over the remaining vesting period.
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 balance sheet date in the countries where the Company operates and generates income.
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.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
The estimated useful lives range as follows:
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.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies (continued)
Short term debtors are measured at transaction price, less any impairment. Amounts owed by group undertakings are intercompany loans measured at cost. These loans are unsecured, interest free and repayable on demand.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash held on deposit by service providers is included within bank and cash balances, as these amounts are highly liquid and repayable without penalty on notice of not more than 24 hours.
Short term creditors are measured at the transaction price. Amounts owed to group undertakings are intercompany loans. These loans are repayable on demand and incur interest at a rate of 3.87% per annum on the outstanding principal amount.
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Provisions for liabilities
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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.
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Judgements in applying accounting policies and key sources of estimation uncertainty
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The preparation of financial statements in conformity with FRS 102 requires management to make
judgements, estimates and assumptions that affect the application of policies and reported amounts of
assets and liabilities, income and expenses. Estimates and judgements are continually evaluated and are
based on historical experience and other factors, including expectations of future events that are believed
to be reasonable under the circumstances.
The estimates and assumptions that have a significant risk of causing material adjustment to the carrying
amounts of assets and liabilities are addressed below.
Share based payments
Management have exercised judgment in assessing the treatment and disclosure of RSUs (Restricted Stock Units) and their vesting condition. Management have determined that the associated non-market conditions are unlikely to be satisfied in a timeframe that would result in ultimate vesting of the current RSUs. As such, no expense has been recognised in this regard.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Judgements in applying accounting policies (continued)
Restructuring provision
Management exercised judgement in the prior year regarding the treatment and calculation of a restructuring provision for one-off costs in relation to the reduction in force undertaken in February 2023. In line with the requirements of FRS 102, management accrued the associated costs into the financial statements on the basis the decision was made during the year ended 31 December 2022. Management exercised judgement by also accruing the associated salary costs for the consultation period that spanned into January 2023, on the basis that services were no longer being rendered by the employees despite their ongoing employment status.
Bad debt provision
Management have reviewed the need for a provision for potential bad debts. Management have applied a policy of providing for all debts unpaid after 90 days.
The auditors' report on the financial statements for the year ended 31 December 2023 was unqualified.
The audit report was signed on 23 August 2024 by Nick Whitehead FCCA (Senior Statutory Auditor) on behalf of ZEDRA Corporate Reporting Services (UK) Limited.
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The average monthly number of employees, including directors, during the year was 41 (2022 - 64).
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Charge for the year on owned assets
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Amounts owed by group undertakings
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Prepayments and accrued income
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Included within other debtors is corporation tax recoverable of £178,662 (2022: £nil).
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Capital contribution reserve
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Certain employees of the group have been granted Restricted Stock Units (“RSU”) over the shares in the Company’s ultimate parent company.
Vesting conditions of RSUs are split into two different categories:
∙RSUs granted under the 2013 Stock Plan prior to 2021 include both a service condition, which is typically satisfied over four years, and a performance condition which is deemed satisfied upon a liquidity event.
∙RSUs granted under the 2013 Stock Plan from 2021 include a service condition, which is typically satisfied over four years, and two performance conditions. The first performance condition is an interim liquidity event which is deemed satisfied upon a private company tender offer being received by the ultimate parent company, where the offer meets specified thresholds in relation to aggregate purchase price and implied valuation of the parent company. Upon satisfaction of the interim liquidity event, twenty percent of the RSUs that have satisfied the time vesting condition will vest immediately. The remaining performance condition is deemed satisfied on a full liquidity event.
An expense equivalent to the fair value of RSUs granted is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied with a corresponding amount being recognised in a capital contribution reserve. The expense recognised is only in relation to UK employees and not any temporary assignees from other group entities.
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Commitments under operating leases
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At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Plaid, Inc. is the parent of the smallest group for which financial statements are drawn up, of which the Company is a member. The registered office of the parent company is 1098 Harrison St, San Francisco, CA 94103.
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Post balance sheet events
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There are no non-adjusting or adjusting post balance sheet events occurring between the end of the reporting period and the date these financial statements were approved.
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