Company Registration No. 05676455 (England and Wales)
ISITETV LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2023
LB GROUP
The Octagon
Suite E2, 2nd Floor
Middleborough
Colchester
CO1 1TG
ISITETV LIMITED
COMPANY INFORMATION
Director
Mr M A Payne
Secretary
Mr M A Payne
Company number
05676455
Registered office
8 Tollgate Business Park
Stanway
Colchester
Essex
United Kingdom
CO3 8AB
Auditor
LB Group Limited (Colchester)
The Octagon
Suite E2, 2nd Floor
Middleborough
Colchester
CO1 1TG
ISITETV LIMITED
CONTENTS
Page
Strategic report
1 - 2
Director's report
3
Director's responsibilities statement
4
Independent auditor's report
5 - 7
Statement of total comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
ISITETV LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 1 -
The director presents the strategic report for the year ended 30 November 2023.
Fair review of the business
The challenging economic climate experienced in the year to November 2022 continued to dominate into 2023, with further budget cuts from both UK and global clients resulting in a 5% decrease in turnover against the prior year (2022: 1% decrease).
The business weathered the storm of both this and ongoing inflationary pressures to the cost base by continuing to focus on cost control. Redundancies made at the end of 2022 generated full year 2023 savings of almost £0.5m, while a restructure of the casting department and the way talent is sourced generated a 10% year on year saving, offsetting escalating costs in this area.
Work was also undertaken in the latter part of the year to migrate our data lake and create a more fully featured service for clients which is cheaper and easier to maintain. The benefits of this will not be seen until 2024 but should offset inflationary pressures in this area of our technology overhead.
Overall we have closed out another challenging year with a tighter and more efficient cost base and are in an excellent position to take the business forward as economic confidence returns.
Principal risks and uncertainties
Risk management is undertaken at all levels of the business, however the Director takes overall responsibility for determining the level and category of risks they are prepared to take to achieve the company’s objectives.
The principal risks areas managed by the business were as follows:
Copyright / Intellectual property
Copyright and intellectual property management are significant areas of risk for the company, both in terms of protecting its own assets and ensuring third party rights are not inadvertently breached. Proof of ownership of any non-iSite created content is required from clients before third party content is edited or distributed in any way and iSite vigorously defends its own IP against misuse.
Credit risk
Global economic uncertainty has created additional pressure on many businesses, and while iSite’s clients are, on the whole, national or multi-national corporations with strong balance sheets and cashflows, credit risk remains a very real area of concern. All new clients are credit checked and evaluated and all clients are monitored for credit changes. Payment patterns are tracked and the company encourages clients to enter into dialogue when facing cashflow difficulties.
Development and performance
iSite continued to invest in developing internal technologies to enable volume content to be produced at speed and our UK patent for “A method of and a system for generating a 3D model of a manufactured product and digital assets therefrom” was granted in the period.
The growing importance of the technology aspect of iSite’s content production offering was also rewarded by the winning of two awards in 2023; “Best Platform/Technology/Tool for Content” at the UK Content Awards and “UK User Experience of the Year” at the UK eCommerce Awards.
The content produced by iSite up to the end of 2023 was live on 408 retail websites during the year (2022: 485) and viewed by millions of consumers, with our syndication and Where to Buy services live in 39 countries (2022: 38). iSite’s Where to Buy service is highly valued by our European clients, so it was especially pleasing to extend our reach more globally in the year, increasing coverage from just 12 countries in 2 continents in 2022 to 39 countries across 5 continents by the end of 2023, with further expansion scheduled for 2024.
ISITETV LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 2 -
Key performance indicators
iSite measures and tracks business performance via a number of KPIs, detailed below:
2023
2022
Turnover
7,389,787
7,774,401
EBITDA & Management Charges
486,732
457,896
EBITDAM as a % of turnover
6.6%
5.9%
Revenue generation per head
69,715
73,343
Capital investment as a % of turnover
1.9%
4.3%
Mr M A Payne
Director
22 August 2024
ISITETV LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 3 -
The director presents his annual report and financial statements for the year ended 30 November 2023.
Principal activities
The principal activity of the Company is the production of high quality digital content for retail and manufacturing clients and the distribution of this content via a sophisticated global syndication network.
The company produces this rich media for several markets, including Retail, Health and Beauty, Home Electronics, Home Appliances, Computing, Photography, Professional Services, FMCG, Baby & Toy, Sport & Leisure, DIY and B2B Technology.
The service offering supports all stages of the customer journey from product set up, to content production, country specific localisation and optimised content delivery to any device. iSite proactively works with clients to develop their content, providing refined intelligence and analytics around content views and product purchases. iSite also produces television commercials in its dedicated TV studio facility.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The director does not recommend payment of a final dividend.
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
Mr M A Payne
Auditor
LB Group Limited (Colchester) were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Mr M A Payne
Director
22 August 2024
ISITETV LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 4 -
The director is responsible for preparing the annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
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 enable them to ensure that the financial statements comply with the Companies Act 2006. He 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.
ISITETV LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF ISITETV LIMITED
- 5 -
Opinion
We have audited the financial statements of ISiteTV Limited (the 'company') for the year ended 30 November 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 30 November 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is responsible for the other information. 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 statements, 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 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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.
ISITETV LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF ISITETV LIMITED
- 6 -
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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of director
As explained more fully in the director's responsibilities statement, 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 has no realistic alternative but to do so.
Auditor's 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.
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 the digital advertising sector;
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, 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; and
Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
ISITETV LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF ISITETV LIMITED
- 7 -
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;
Reviewed the internal controls in place, specifically around payroll and bank transactions; and
Assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias.
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 and the company's legal advisors.
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 is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Shaun Roberts
Senior Statutory Auditor
For and on behalf of LB Group Limited (Colchester)
23 August 2024
Chartered Accountants
Statutory Auditor
The Octagon
Suite E2, 2nd Floor
Middleborough
Colchester
CO1 1TG
ISITETV LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
7,389,784
7,774,400
Cost of sales
(1,832,371)
(2,007,911)
Gross profit
5,557,413
5,766,489
Administrative expenses
(6,156,867)
(6,439,404)
Operating loss
4
(599,454)
(672,915)
Interest receivable and similar income
7
434
99
Interest payable and similar expenses
8
(59,971)
(59,437)
Loss before taxation
(658,991)
(732,253)
Tax on loss
9
13,172
Loss for the financial year
(645,819)
(732,253)
There was no other comprehensive income for 2023 (2022: £Nil).
ISITETV LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 30 NOVEMBER 2023
30 November 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
39,350
35,274
Tangible assets
12
648,679
937,171
688,029
972,445
Current assets
Debtors
13
3,248,551
4,387,975
Cash at bank and in hand
15,641
33,953
3,264,192
4,421,928
Creditors: amounts falling due within one year
14
(2,224,625)
(2,896,241)
Net current assets
1,039,567
1,525,687
Total assets less current liabilities
1,727,596
2,498,132
Creditors: amounts falling due after more than one year
15
(156,568)
(281,285)
Provisions for liabilities
Deferred tax liability
18
215,380
215,380
(215,380)
(215,380)
Net assets
1,355,648
2,001,467
Capital and reserves
Called up share capital
20
180
180
Capital redemption reserve
180
180
Profit and loss reserves
1,355,288
2,001,107
Total equity
1,355,648
2,001,467
The financial statements were approved and signed by the director and authorised for issue on 22 August 2024
Mr M A Payne
Director
Company Registration No. 05676455
ISITETV LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 10 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 December 2021
180
180
2,883,360
2,883,720
Year ended 30 November 2022:
Loss and total comprehensive income for the year
-
-
(732,253)
(732,253)
Dividends
10
-
-
(150,000)
(150,000)
Balance at 30 November 2022
180
180
2,001,107
2,001,467
Year ended 30 November 2023:
Loss and total comprehensive income for the year
-
-
(645,819)
(645,819)
Balance at 30 November 2023
180
180
1,355,288
1,355,648
ISITETV LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
514,028
507,530
Interest paid
(59,971)
(59,437)
Income taxes refunded
77,742
Net cash inflow from operating activities
531,799
448,093
Investing activities
Purchase of intangible assets
(12,017)
(12,396)
Purchase of tangible fixed assets
(89,658)
(205,514)
Proceeds from disposal of tangible fixed assets
36,486
63,500
Interest received
434
99
Net cash used in investing activities
(64,755)
(154,311)
Financing activities
Payment of finance leases obligations
(187,590)
(224,952)
Dividends paid
(150,000)
Net cash used in financing activities
(187,590)
(374,952)
Net increase/(decrease) in cash and cash equivalents
279,454
(81,170)
Cash and cash equivalents at beginning of year
(510,572)
(429,402)
Cash and cash equivalents at end of year
(231,118)
(510,572)
Relating to:
Cash at bank and in hand
15,641
33,953
Bank overdrafts included in creditors payable within one year
(246,759)
(544,525)
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 12 -
1
Accounting policies
Company information
ISiteTV Limited is a private company limited by shares incorporated in England and Wales. The registered office is 8 Tollgate Business Park, Stanway, Colchester, Essex, United Kingdom, CO3 8AB.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
The company has net assets at the year end of c£1.4m (2022: c£2.0m) and net current assets of c£1.0m (2022: c£1.5m).true
The results at the time of sign off are strong with positive outlook, cashflow generation, headroom in the business finance facilities and financial support from the ultimate owner to enable the directors continued adoption of the going concern principle for at least 12 months from the date these financial statements are signed.
The Director is satisfied that the company has adequate resources in place for at least the next 12 months and that it is appropriate to prepare the financial statements on the going concern basis.
1.3
Turnover
Turnover is measured at the fair value of the consideration received or receivable for the provision of services, net of discounts and value-added taxes via two distinct revenue streams Digital marketing and production services & Where-to-buy income.
Digital Marketing Services
For annual contracts, revenue is recognised with reference to the period in which costs are incurred, and the services are provided. For stand-alone work, revenue is recognised in the month in which it is billed and work is completed.
Where-to-buy income
Revenue is either earned monthly or annually in arrears and is recognised with reference to the period in which related costs are incurred
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software
25% straight line
Patents & licences
10% straight line
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
over term of lease
Plant and equipment
25% straight line
Fixtures and fittings
25% straight line
IT equipment
25% straight line
Motor vehicles
25% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 14 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 15 -
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation.
Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
The Company recognises a provision for annual leave accrued by employees as a result of services rendered in the current period, and which employees are entitled to carry forward and use within the next 4 weeks. The provision is measured at the salary cost payable for the period of absence.
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
The directors believe that there are no significant judgements or key sources of estimation uncertainty, other than those in relation to accrued and deferred income.
Accrued and deferred income calculations are performed by using details of all invoices raised to customers in the year, compared with the listing of actual work completed in the year and the sales value of these items. There is therefore a limited amount of judgement involved as the calculations are based on factual information. At year end accrued income amounted to £39,006 (2022: £146,056) and deferred income amounted to £346,011 (2022: £722,137).
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Production and hosting
7,254,574
7,680,698
Affiliate commission
135,210
93,702
7,389,784
7,774,400
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
3
Turnover and other revenue
(Continued)
- 17 -
2023
2022
£
£
Turnover analysed by geographical market
UK
6,254,651
7,363,270
Europe
772,010
240,660
Rest of World
363,123
170,470
7,389,784
7,774,400
2023
2022
£
£
Other revenue
Interest income
434
99
4
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses
774
2,233
Depreciation of owned tangible fixed assets
235,141
236,832
Depreciation of tangible fixed assets held under finance leases
177,768
211,697
Profit on disposal of tangible fixed assets
(29,596)
(36,504)
Amortisation of intangible assets
7,941
16,945
Operating lease charges
438,167
429,997
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
12,000
11,800
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
83
106
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
6
Employees
(Continued)
- 18 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
3,969,400
4,467,415
Pension costs
57,738
69,352
4,027,138
4,536,767
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
434
99
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
434
99
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on finance arrangements
37,373
25,553
Other finance costs:
Interest on finance leases and hire purchase contracts
22,598
33,884
59,971
59,437
9
Taxation
2023
2022
£
£
Current tax
Adjustments in respect of prior periods
(13,172)
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
9
Taxation
(Continued)
- 19 -
The actual (credit)/charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(658,991)
(732,253)
Expected tax credit based on the standard rate of corporation tax in the UK of 19%, changing to 25% part way through the year. (2022: 19%)
(164,748)
(139,128)
Tax effect of expenses that are not deductible in determining taxable profit
105,213
4,116
Tax effect of income not taxable in determining taxable profit
(7,399)
Unutilised tax losses carried forward
33,619
Adjustments in respect of prior years
(13,172)
3,295
Group relief
111,433
Permanent capital allowances in excess of depreciation
33,315
34,714
Research and development tax credit
(14,200)
Other non-reversing timing differences
(230)
Taxation credit for the year
(13,172)
-
10
Dividends
2023
2022
£
£
Final paid
150,000
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 20 -
11
Intangible fixed assets
Software
Patents & licences
Total
£
£
£
Cost
At 1 December 2022
69,584
31,312
100,896
Additions
12,017
12,017
At 30 November 2023
69,584
43,329
112,913
Amortisation and impairment
At 1 December 2022
61,078
4,544
65,622
Amortisation charged for the year
3,969
3,972
7,941
At 30 November 2023
65,047
8,516
73,563
Carrying amount
At 30 November 2023
4,537
34,813
39,350
At 30 November 2022
8,506
26,768
35,274
12
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
IT equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 December 2022
581,004
1,403,026
234,790
476,192
261,881
2,956,893
Additions
70,979
18,679
41,649
131,307
Disposals
(75,291)
(13,386)
(25,000)
(113,677)
At 30 November 2023
581,004
1,398,714
234,790
481,485
278,530
2,974,523
Depreciation and impairment
At 1 December 2022
480,686
992,791
167,805
234,220
144,220
2,019,722
Depreciation charged in the year
29,829
209,004
30,486
107,859
35,731
412,909
Eliminated in respect of disposals
(75,291)
(6,496)
(25,000)
(106,787)
At 30 November 2023
510,515
1,126,504
198,291
335,583
154,951
2,325,844
Carrying amount
At 30 November 2023
70,489
272,210
36,499
145,902
123,579
648,679
At 30 November 2022
100,318
410,235
66,985
241,972
117,661
937,171
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
12
Tangible fixed assets
(Continued)
- 21 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and equipment
105,369
177,075
Motor vehicles
104,529
92,081
Other fixed assets
70,677
136,298
280,575
405,454
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
979,217
1,469,833
Corporation tax recoverable
64,570
Other debtors
2,053,980
2,536,476
Prepayments and accrued income
215,354
317,096
3,248,551
4,387,975
Within other debtors included are amounts due from Spire Media Limited, the parent company, of £2,044,656 (2022: £2,514,450).
Within other debtors included are amounts due from iSite Intelligence Limited, a company within the same group, of £1,424 (2022: £1,424).
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
246,759
544,525
Obligations under finance leases
17
157,466
178,690
Trade creditors
215,549
213,855
Amounts owed to group undertakings
807,309
807,309
Taxation and social security
304,678
289,717
Other creditors
733
4,436
Accruals and deferred income
492,131
857,709
2,224,625
2,896,241
Within creditors are amounts due to ISite Group Limited, the parent company, of £807,309 (2022: £807,309).
A limited guarantee of £120,000 has been given by a director to Barclays Bank PLC, over banking facilities held by the Company.
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 22 -
15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
17
156,568
281,285
16
Loans and overdrafts
2023
2022
£
£
Bank overdrafts
246,759
544,525
Payable within one year
246,759
544,525
A limited guarantee of £120,000 has been given by a director to Barclays Bank PLC, over banking facilities held by the Company.
17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
157,466
178,690
In two to five years
156,568
281,285
314,034
459,975
Finance lease obligations are secured against the assets to which they relate.
18
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
215,380
215,380
There were no deferred tax movements in the year.
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 23 -
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
57,738
69,352
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
180
180
180
180
The company has one class of ordinary shares which carry full voting, dividend and capital distribution rights. They do not confer any rights of redemption.
21
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
235,248
279,463
Between two and five years
47,713
202,997
282,961
482,460
22
Related party transactions
During the year management charges were charged by a group undertaking in relation to intercompany loans, salaries and dividends and group tax liabilities. The net effect of these transactions was £665,336 (2022: £665,336).
The net amount due from group undertakings at the year end was £1,238,771 (2022: £1,708,565). During the year the company recharged/was recharged for the use of a vehicle and other business expenses (net expenditure) totalling £8,936 (2022: £1,175) by the director of the company.
23
Ultimate controlling party
The immediate controlling party is iSite Group Limited.
The ultimate parent company is Spire Media Limited and the ultimate controlling party is M Payne.
Both companies have their registered office at 8 Tollgate Business Park, Stanway, Colchester, Essex, CO3 8AB.
ISITETV LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 24 -
24
Cash generated from operations
2023
2022
£
£
Loss for the year after tax
(645,819)
(732,253)
Adjustments for:
Taxation credited
(13,172)
Finance costs
59,971
59,437
Investment income
(434)
(99)
Gain on disposal of tangible fixed assets
(29,596)
(36,504)
Amortisation and impairment of intangible assets
7,941
16,945
Depreciation and impairment of tangible fixed assets
412,909
448,529
Movements in working capital:
Decrease in debtors
1,074,854
406,065
(Decrease)/increase in creditors
(352,626)
345,410
Cash generated from operations
514,028
507,530
25
Analysis of changes in net debt
1 December 2022
Cash flows
New finance leases
30 November 2023
£
£
£
£
Cash at bank and in hand
33,953
(18,312)
-
15,641
Bank overdrafts
(544,525)
297,766
-
(246,759)
(510,572)
279,454
(231,118)
Obligations under finance leases
(459,975)
187,590
(41,649)
(314,034)
(970,547)
467,044
(41,649)
(545,152)
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