Limited Liability Partnership registration number OC304248 (England and Wales)
ARIAN FINANCIAL LLP
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
ARIAN FINANCIAL LLP
LIMITED LIABILITY PARTNERSHIP INFORMATION
Designated members
J Meadows
K Rehal
LLP registration number
OC304248
Registered office
4th Floor
12 Appold Street
London
EC2A 2AW
Auditor
Fisher, Sassoon & Marks
43-45 Dorset Street
London
W1U 7NA
ARIAN FINANCIAL LLP
CONTENTS
Page
Members' report
1 - 2
Independent auditor's report
3 - 5
Statement of comprehensive income
6
Balance sheet
7 - 8
Reconciliation of members' interests
9 - 10
Statement of cash flows
11
Notes to the financial statements
12 - 22
ARIAN FINANCIAL LLP
MEMBERS' REPORT
FOR THE YEAR ENDED 31 MARCH 2022
- 1 -

The members present their annual report and financial statements for the year ended 31 March 2022.

Principal activities

The principal activity of the limited liability partnership be that of the provision of brokerage services.

Fair review of the business

The results for the year and the financial position at the year end were considered satisfactory by the members. The results include a further provision of £193,000 to cover the potential cost in reaching a settlement with the Financial Conduct Authority over regulatory breaches from broking activities undertaken in prior years.

 

On the 17th of March 2022 the wholesale broking of equity, fixed income and commodity derivatives carried on by the LLP was sold to Vantage Capital Markets LLP. The LLP made a profit of £4,899,893 before members remuneration and profit share.

 

business comprising of the equity, fixed income and commodity derivatives was sold by the LLP to Vantage Capital Markets LLP.

Designated members

The designated members who held office during the year and up to the date of signature of the financial statements were as follows:

J Meadows
Coborn Properties Limited
(Resigned 17 March 2022)
K Rehal
Financial instruments
Liquidity risk

The limited liability partnership manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the limited liability partnership has sufficient liquid resources to meet the operating needs of the business.

Foreign currency risk

The limited liability partnership’s principal foreign currency exposures arise from trading with overseas companies. The limited liability partnership's policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling. This hedging activity involves the use of foreign exchange forward contracts.

Credit risk

Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the members.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Post reporting date events

The firm applied to cancel its FCA authorisation to undertake investment services on 25th January 2023.

Auditor

The auditor, Fisher, Sassoon & Marks, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Energy and carbon report

As the LLP has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.

ARIAN FINANCIAL LLP
MEMBERS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 2 -
Statement of members' responsibilities

The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice. Under company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the limited liability partnership and of the profit or loss of the limited liability partnership for that period. In preparing these financial statements, the members are required to:

 

 

The members are responsible for keeping adequate accounting records that are sufficient to show and explain the limited liability partnership’s transactions and disclose with reasonable accuracy at any time the financial position of the limited liability partnership and enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the limited liability partnership and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

Each of the members in office at the date of approval of this annual report confirms that:

 

Approved by the members on 6 August 2024 and signed on behalf by:
06 August 2024
J Meadows
Designated Member
ARIAN FINANCIAL LLP
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ARIAN FINANCIAL LLP
- 3 -
Opinion

We have audited the financial statements of Arian Financial LLP (the 'limited liability partnership') for the year ended 31 March 2022 which comprise the statement of comprehensive income, the balance sheet, the reconciliation of members' interests, 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:

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 limited liability partnership 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.

Emphasis of matter

We draw attention to note 13 of the financial statements, which details that the LLP has made a provision for net legal fees and regulatory fines that arise from broking activities undertaken in prior periods. The LLP has provided for £481,000 based on advice from its solicitors in relation to this matter. The final amount payable is uncertain and accordingly the position could vary significantly. Our opinion is not modified in this respect.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the members' 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 limited liability partnership’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 members 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 members 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.

ARIAN FINANCIAL LLP
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARIAN FINANCIAL LLP
- 4 -
Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 as applied to limited liability partnerships requires us to report to you if, in our opinion:

 

Responsibilities of members

As explained more fully in the members' responsibilities statement, the members 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 members 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 members are responsible for assessing the limited liability partnership'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 members either intend to liquidate the limited liability partnership or to cease operations, or have 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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

The extent to which the audit was considered capable of detecting irregularities including fraud

 

ARIAN FINANCIAL LLP
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARIAN FINANCIAL LLP
- 5 -

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

 

To address the risk of fraud through management bias and override of controls, we:

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

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 through 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.

Use of our report

This report is made solely to the limited liability partnership's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the limited liability partnership'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 limited liability partnership and the limited liability partnership's members as a body, for our audit work, for this report, or for the opinions we have formed.

Jonathan Marks
Senior Statutory Auditor
For and on behalf of Fisher, Sassoon & Marks
6 August 2024
Chartered Accountants
Statutory Auditor
43-45 Dorset Street
London
W1U 7NA
ARIAN FINANCIAL LLP
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2022
- 6 -
2022
2021
Notes
£
£
Turnover
3
6,452,905
6,531,708
Cost of sales
(4,522,903)
(4,702,957)
Gross profit
1,930,002
1,828,751
Administrative expenses
(1,822,868)
(1,432,018)
Other operating income
12,500
-
Exceptional item
4
(193,000)
(288,000)
Operating (loss)/profit
5
(73,366)
108,733
Interest payable and similar expenses
9
-
(2,653)
Profit/(loss) on disposal of operations
4,973,259
Profit for the financial year before members' remuneration and profit shares
4,899,893
106,080
Members' remuneration charged as an expense
8
(250,000)
(250,000)
Profit/(loss) for the financial year available for discretionary division among members
4,649,893
(143,920)

The profit and loss account has been prepared on the basis that all operations are continuing operations.

ARIAN FINANCIAL LLP
BALANCE SHEET
AS AT
31 MARCH 2022
31 March 2022
- 7 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
10
1
18,267
Investments
11
2,427,000
-
2,427,001
18,267
Current assets
Debtors falling due after more than one year
12
1,434,759
-
Debtors falling due within one year
12
3,955,076
2,459,125
Cash at bank and in hand
294,972
299,070
5,684,807
2,758,195
Creditors: amounts falling due within one year
14
(1,767,005)
(1,425,464)
Net current assets
3,917,802
1,332,731
Total assets less current liabilities
6,344,803
1,350,998
Creditors: amounts falling due after more than one year
15
(180,912)
-
Provisions for liabilities
Provisions
16
(481,000)
(318,000)
Net assets attributable to members
5,682,891
1,032,998
Represented by:
Members' other interests
Members' capital classified as equity
1,176,918
1,176,918
Other reserves classified as equity
4,505,973
(143,920)
5,682,891
1,032,998
Total members' interests
Amounts due from members
(911,613)
(739,213)
Members' other interests
5,682,891
1,032,998
4,771,278
293,785
ARIAN FINANCIAL LLP
BALANCE SHEET (CONTINUED)
AS AT
31 MARCH 2022
31 March 2022
- 8 -
The financial statements were approved by the members and authorised for issue on 6 August 2024 and are signed on their behalf by:
06 August 2024
J Meadows
Designated member
Limited Liability Partnership registration number OC304248 (England and Wales)
ARIAN FINANCIAL LLP
RECONCILIATION OF MEMBERS' INTERESTS
FOR THE YEAR ENDED 31 MARCH 2022
- 9 -
Current financial year
EQUITY
DEBT
TOTAL
Members' other interests
Loans and other debts due to members less any amounts due from members in debtors
MEMBERS'
INTERESTS
Members' capital
Other reserves
Total
Other amounts
Total
Total
2022
£
£
£
£
£
£
Members' interests at 1 April 2021
1,176,918
(143,920)
1,032,998
(739,213)
(739,213)
293,785
Members' remuneration charged as an expense, including employment costs and retirement benefit costs
-
-
-
250,000
250,000
250,000
Profit for the financial year available for discretionary division among members
-
4,649,893
4,649,893
-
-
4,649,893
Members' interests after profit and remuneration for the year
1,176,918
4,505,973
5,682,891
(489,213)
(489,213)
5,193,678
Drawings on account and distributions of profit
-
-
-
(422,400)
(422,400)
(422,400)
Members' interests at 31 March 2022
1,176,918
4,505,973
5,682,891
(911,613)
(911,613)
4,771,278
Amounts due to members
-
Amounts due from members, included in debtors
(911,613)
(911,613)
ARIAN FINANCIAL LLP
RECONCILIATION OF MEMBERS' INTERESTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 10 -
Prior financial year
EQUITY
DEBT
TOTAL
Members' other interests
Loans and other debts due to members less any amounts due from members in debtors
MEMBERS'
INTERESTS
Members' capital
Other reserves
Total
Other amounts
Total
Total
2021
£
£
£
£
£
£
Members' interests at 1 April 2020
1,176,918
-
1,176,918
(530,462)
(530,462)
646,456
Members' remuneration charged as an expense, including employment costs and retirement benefit costs
-
-
-
250,000
250,000
250,000
Loss for the financial year available for discretionary division among members
-
(143,920)
(143,920)
-
-
(143,920)
Members' interests after loss and remuneration for the year
1,176,918
(143,920)
1,032,998
(280,462)
(280,462)
752,536
Drawings on account and distributions of profit
-
-
-
(458,751)
(458,751)
(458,751)
Members' interests at 31 March 2021
1,176,918
(143,920)
1,032,998
(739,213)
(739,213)
293,785
Amounts due to members
-
Amounts due from members, included in debtors
(739,213)
(739,213)
ARIAN FINANCIAL LLP
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2022
- 11 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
21
(2,373,502)
156,213
Interest paid
-
(2,653)
Net cash (outflow)/inflow from operating activities
(2,373,502)
153,560
Investing activities
Proceeds of disposal of unincorporated business
4,973,259
-
Purchase of tangible fixed assets
(4,455)
(20,830)
Repayment of investment loans and receivables
(2,427,000)
-
Net cash generated from/(used in) investing activities
2,541,804
(20,830)
Financing activities
Payments to members that represent a return on amounts subscribed or otherwise contributed
(422,400)
(458,751)
Repayment of borrowings
250,000
-
Net cash used in financing activities
(172,400)
(458,751)
Net decrease in cash and cash equivalents
(4,098)
(326,021)
Cash and cash equivalents at beginning of year
299,070
625,091
Cash and cash equivalents at end of year
294,972
299,070
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
- 12 -
1
Accounting policies
Limited liability partnership information

Arian Financial LLP is a limited liability partnership incorporated in England and Wales. The registered office is 4th Floor, 12 Appold Street, London, EC2A 2AW.

 

The limited liability partnership's principal activities are disclosed in the Members' Report.

1.1
Accounting convention

These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in December 2018, together 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 limited liability partnership. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Going concern

At the time of approving the financial statements, the members have a reasonable expectation that the limited liability partnership has adequate resources to continue in operational existence for the foreseeable future. Thus the members continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover represents amounts receivable for provision of brokering of equity, fixed income and commodity derivatives.

Turnover is recognised at the fair value of the consideration received or receivable and is recognised on the date the trade is executed.

1.4
Members' participating interests

Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or otherwise contributed remuneration and profits).

 

Members' participation rights in the earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a financial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or otherwise contributed by members, for example members' capital, are classed as liabilities unless the LLP has an unconditional right to refuse payment to members, in which case they are classified as equity.

Once an unavoidable obligation has been created in favour of members through allocation of profits or other means, any undrawn profits remaining at the reporting date are shown as ‘Loans and other debts due to members’ to the extent they exceed debts due from a specific member.

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:

Fixtures, fittings & equipment
15% Straight line
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 13 -

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 recognised in the profit and loss account.

1.6
Cash at bank and in hand

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.

1.7
Financial instruments

The limited liability partnership has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the limited liability partnership's statement of financial position when the limited liability partnership becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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.

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 limited liability partnership 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.

ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 14 -
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 limited liability partnership 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.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

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 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 limited liability partnership’s obligations expire or are discharged or cancelled.

1.8
Equity instruments

Equity instruments issued by the limited liability partnership are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the limited liability partnership.

1.9
Derivatives

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

 

A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.

ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 15 -
1.10
Provisions

Provisions are recognised when the limited liability partnership has a legal or constructive present obligation as a result of a past event, it is probable that the limited liability partnership 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.

1.11
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 limited liability partnership is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.12
Retirement benefits and post retirement payments to members

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.13
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

1.14
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

In the application of the limited liability partnership’s accounting policies, the members are required to make judgements, estimates and assumptions about the carrying amount 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 16 -
3
Turnover

An analysis of the limited liability partnership's turnover is as follows:

2022
2021
£
£
Turnover analysed by class of business
Brokering of equity, fixed income and commodity derivatives
6,452,905
6,531,708
2022
2021
£
£
Turnover analysed by geographical market
UK and EC
6,452,905
6,531,708
4
Exceptional item
2022
2021
£
£
Expenditure
Provision for regulatory fines and related legal fees
193,000
288,000
5
Operating (loss)/profit
2022
2021
Operating (loss)/profit for the year is stated after charging:
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
40,457
22,292
Depreciation of owned tangible fixed assets
22,721
3,230
Operating lease charges
240,200
240,135
6
Auditor's remuneration
2022
2021
Fees payable to the LLP's auditor and associates:
£
£
For audit services
Audit of the financial statements of the LLP
16,500
12,500
7
Employees

The average number of persons (excluding members) employed by the partnership during the year was:

2022
2021
Number
Number
Administration
7
4
Brokers
4
2
Total
11
6
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
7
Employees
(Continued)
- 17 -

Their aggregate remuneration comprised:

2022
2021
£
£
Wages and salaries
638,181
386,027
Social security costs
72,480
41,352
Pension costs
6,302
4,130
716,963
431,509
8
Members' remuneration
2022
2021
Number
Number
The average number of members during the year was
3
4
2022
2021
£
£
Profit attributable to the member with the highest entitlement
250,000
250,000
Average members remuneration
125,000
62,500
2022
2021
£
£
Remuneration under participation rights
250,000
250,000
9
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
2,653
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 18 -
10
Tangible fixed assets
Fixtures, fittings & equipment
£
Cost
At 1 April 2021
21,497
Additions
4,455
At 31 March 2022
25,952
Depreciation and impairment
At 1 April 2021
3,230
Depreciation charged in the year
22,721
At 31 March 2022
25,951
Carrying amount
At 31 March 2022
1
At 31 March 2021
18,267
11
Fixed asset investments
2022
2021
£
£
Unlisted investments
2,427,000
-
Movements in fixed asset investments
Investments
£
Cost or valuation
At 1 April 2021
-
Additions
2,427,000
At 31 March 2022
2,427,000
Carrying amount
At 31 March 2022
2,427,000
At 31 March 2021
-
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 19 -
12
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
1,890,369
1,668,207
Amounts owed by members
911,613
739,213
Other debtors
1,152,382
20,866
Prepayments and accrued income
712
30,839
3,955,076
2,459,125
2022
2021
Amounts falling due after more than one year:
£
£
Other debtors
1,434,759
-
Total debtors
5,389,835
2,459,125

Other debtors represent amounts owed by Vantage Capital Markets LLP in connection with the asset purchase agreement which took place on 17 March 2022.

13
Loans and overdrafts
2022
2021
£
£
Other loans
250,000
-
Payable within one year
69,088
-
Payable after one year
180,912
-
14
Creditors: amounts falling due within one year
2022
2021
Notes
£
£
Other borrowings
13
69,088
-
Trade creditors
1,573,512
1,382,657
Other taxation and social security
938
-
Other creditors
30,782
16,537
Accruals and deferred income
92,685
26,270
1,767,005
1,425,464
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 20 -
15
Creditors: amounts falling due after more than one year
2022
2021
Notes
£
£
Other borrowings
13
180,912
-
16
Provisions for liabilities
2022
2021
£
£
Legal and regulatory fines
481,000
318,000
Movements on provisions:
Legal and regulatory fines
£
At 1 April 2021
318,000
Additional provisions in the year
193,000
Utilisation of provision
(30,000)
At 31 March 2022
481,000

The LLP has made a provision in relation to estimated net legal and regulatory fines arising from a regulatory review of the brokerage business by the FCA.

 

The FCA are seeking a penalty and disgorgement (circa £750,000) in relation to historical business undertaken by the LLP. The LLP having sought legal advice and made a general provision of £481,000 to cover net legal costs and FCA fines in relation to the matter, The LLP is disputing the calculation of fines and disgorgement calculated by the FCA, the outcome of which will only be determined following the matter being considered by a First Tier Tribunal.

17
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
6,302
4,130

The limited liability partnership operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the limited liability partnership in an independently administered fund.

ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 21 -
18
Operating lease commitments
Lessee

The operating leases represent a leasehold lease to a unconnected third party. The lease was originally negotiated over terms of 10 years and rentals are fixed for 5 years. All leases include a provision for five-yearly upward rent reviews according to prevailing market conditions. There are no options in place for either party to extend the lease terms. The lease terminated on 23rd March 2022.

At the reporting end date the limited liability partnership had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2022
2021
£
£
Within one year
-
232,587
19
Disposal of a trade

On 17 March 2022 the limited liability partnership disposed of its wholesale broking trade for a consideration of £4,973,259. Included in these financial statements are profits from the sale of £4,973,259 arising from the limited liability partnership's interests in the business of wholesale broking of equity, fixed income and commodity derivatives carried on by Arian up to the date of its disposal.

£
Gain on disposal
4,973,259
Total consideration
4,973,259
20
Ultimate controlling party

The ultimate controlling party is John Meadows by virtue of his capital contribution to the LLP and voting rights.

21
Cash (absorbed by)/generated from operations
2022
2021
£
£
Profit for the year
4,899,893
106,080
Adjustments for:
Finance costs recognised in profit or loss
-
2,653
Gain on disposal of unincorporated business
(4,973,259)
-
Depreciation and impairment of tangible fixed assets
22,721
3,230
Increase in provisions
163,000
288,000
Movements in working capital:
Increase in debtors
(2,758,310)
(94,573)
Increase/(decrease) in creditors
272,453
(149,177)
Cash (absorbed by)/generated from operations
(2,373,502)
156,213
ARIAN FINANCIAL LLP
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 22 -
22
Analysis of changes in net funds
1 April 2021
Cash flows
31 March 2022
£
£
£
Cash at bank and in hand
299,070
(4,098)
294,972
Borrowings excluding overdrafts
-
(250,000)
(250,000)
299,070
(254,098)
44,972
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