Company registration number 01522341 (England and Wales)
TELLERMATE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
TELLERMATE LIMITED
COMPANY INFORMATION
Directors
Mr P T Baker
Mr R Dell'Aquila
Mr D Hawks III
Mr M LaConti
Mr D W Lunn
Mr P J Rendell
Secretary
Mr N J Bell
Company number
01522341
Registered office
Leeway House
Leeway Industrial Estate
Newport
NP19 4SL
Auditor
UHY Hacker Young
Bradbury House
Mission Court
Newport
Gwent
United Kingdom
NP20 2DW
TELLERMATE LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 26
TELLERMATE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The directors present the strategic report for the year ended 31 December 2023.

Review of the business

The results for the year as set out in page 8, show a profit on ordinary activities before taxation of £1,033,489 (2022: £430,630) and turnover of £10,201,422 (2022: £7,155,165). A strong 43% increase in turnover underpinned by legacy international cash counter sales combined with new solutions sales to major retail operators. The increase in turnover has driven a significant increase in earnings before interest, taxation, depreciation, and amortisation, being operating profit plus depreciation (£48,007; 2022: £82,945) and amortisation (118,897; 2022: £111,802) "EBITDA" £1,143,100 (2022: £533,495) – these are the company’s two key indicators of operational performance. The current year result also includes exceptional costs of £386,975; pre-exceptional EBITDA has increased to £1,5300,075.

 

The business continues to secure legacy product orders from an established international customer base which underpins the revenue numbers and allows for strong Gross Margins. In turn, strategically, this allows the business to invest in new technologies which will present enhanced Sales opportunities going forward into existing and new customers, with potential for multiyear purchasing, software licensing and support agreements.

 

The company operates within the cash handling industry, providing cash handling solutions to retailers and banks. The industry is large and incorporates many technologies, of which electronic cash counting has always been a niche product. An alternative to cash for the company's customers is electronic payments, in particular contactless payments. It is our belief that cash will remain a dominant form of payment for some time, Electronic cash counting will remain an important part of many retailers' cash processes globally due to increasing labour costs, increasing costs for CIT (Cash In Transit) and a general increase in the cost to “handle” cash, as well as introduction of legislation geared towards cash acceptance/payment choice.

Principal risks and uncertainties

The principal risks and uncertainties that affected the company during the year were:

 

Competitive pressure in the markets in which the company operates and the general economic environment are a continuing risk to the company. The company manages this risk by maintaining strong relationships with key customers (with average tenures in excess of 10 years), providing high levels of service, and where applicable a customised solution.

 

The company's sales are global and as such the company has exposure to the risk of foreign exchange movements. The main currencies the company has exposure to are the US Dollar, Euro and Japanese Yen.

 

Option dated forward exchange contracts are used to reduce and manage risk.

Key performance indicators

The company's key financial indicator is sales growth. With a relatively large, fixed cost base, any variation in turnover is normally quickly translated to a variation in profit. The company's continued investment in its new solution based products has diversified the revenue mix and is expected to support its future sales growth ambition.

On behalf of the board

Mr P T Baker
Director
6 September 2024
TELLERMATE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

The directors present their annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the company continued to be that of manufacturing and distributing cash counters.

Results and dividends

The results for the year are set out on page 8.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Mr P T Baker
Mr R Dell'Aquila
Mr D Hawks III
Mr M LaConti
Mr D W Lunn
Mr P J Rendell
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Financial instruments

Financial instruments are all categorised as basic financial instruments under section 11 of FRS 102.

 

The company has exposure to foreign exchange risk through the sale and purchase of products denominated in foreign currency. Option dated forward exchange contracts are used to reduce and manage risk. There were. contracts open at the start and end of the year and these have been recognised on the company Balance sheet in accordance with FRS 102.

Research and development

A key element of Research and Development activity in the year related to the software platforms (LiveDrawer Manager and Touch Viewer) and to new concepts in the LiverDrawer series of products. The platforms help customers maximise the benefits of our solutions.

Future developments

The company continues to invest in its product range, their compatibility and connectivity within customer systems and in particular the development of the intelligent cash drawer and LiveSafe products, which are expected to drive additional future sales growth.

 

Market conditions are expected to remain challenging, but the directors remain confident about the future prospects for the company and continue to focus on customer development, increasing market share and developing new products.

Auditor

The auditor, UHY Hacker Young, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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.

TELLERMATE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr P T Baker
Director
6 September 2024
TELLERMATE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have 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 directors 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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are 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. They are 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.

TELLERMATE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF TELLERMATE LIMITED
- 5 -
Opinion

We have audited the financial statements of Tellermate Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 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 directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

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

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

TELLERMATE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF TELLERMATE LIMITED (CONTINUED)
- 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 directors' 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:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

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 misstatements in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

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

TELLERMATE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF TELLERMATE LIMITED (CONTINUED)
- 7 -

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

 

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from the financial statements, 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.

Use of our 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.

Mr John Griffiths
Senior Statutory Auditor
For and on behalf of UHY Hacker Young
7 September 2024
Chartered Accountants
Statutory Auditor
Newport
Gwent
United Kingdom
TELLERMATE LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
4
10,201,422
7,155,165
Cost of sales
(4,868,976)
(3,250,595)
Gross profit
5,332,446
3,904,570
Distribution costs
(417,469)
(367,773)
Exceptional administrative expenses
3
(386,975)
-
0
Other administrative expenses
(3,551,806)
(3,173,051)
Total administrative expenses
(3,938,781)
(3,173,051)
Other operating income
-
0
5,000
Operating profit
5
976,196
368,746
Interest receivable and similar income
8
58,446
61,884
Interest payable and similar expenses
9
(1,153)
-
Profit before taxation
1,033,489
430,630
Tax on profit
10
(126,983)
283,183
Profit for the financial year
906,506
713,813

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

TELLERMATE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
£
£
Profit for the year
906,506
713,813
Other comprehensive income
-
-
Total comprehensive income for the year
906,506
713,813
TELLERMATE LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
504,898
504,835
Tangible assets
12
65,625
102,006
Investments
13
19,324
19,324
589,847
626,165
Current assets
Stocks
15
699,646
1,177,732
Debtors
16
9,119,885
6,148,861
Cash at bank and in hand
1,550,058
671,356
11,369,589
7,997,949
Creditors: amounts falling due within one year
17
(4,760,982)
(2,306,650)
Net current assets
6,608,607
5,691,299
Total assets less current liabilities
7,198,454
6,317,464
Provisions for liabilities
Provisions
18
150,000
150,000
Deferred tax liability
19
69,066
94,582
(219,066)
(244,582)
Net assets
6,979,388
6,072,882
Capital and reserves
Called up share capital
21
1
1
Profit and loss reserves
6,979,387
6,072,881
Total equity
6,979,388
6,072,882

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 6 September 2024 and are signed on its behalf by:
Mr P T Baker
Director
Company registration number 01522341 (England and Wales)
TELLERMATE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
1
5,359,068
5,359,069
Year ended 31 December 2022:
Profit and total comprehensive income
-
713,813
713,813
Balance at 31 December 2022
1
6,072,881
6,072,882
Year ended 31 December 2023:
Profit and total comprehensive income
-
906,506
906,506
Balance at 31 December 2023
1
6,979,387
6,979,388
TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information

Tellermate Limited is a private company limited by shares incorporated in England and Wales. The registered office is Leeway House, Leeway Industrial Estate, Newport, NP19 4SL.

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. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of Cash Management Solutions Limited. These consolidated financial statements are available from its registered office, C/o Tellermate, Leeway House, Leeway Industrial Estate, Newport, Gwent, NP19 4SL.

The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

 

Tellermate Limited is a wholly owned subsidiary of Cash Management Solutions Limited and the results of Tellermate Limited are included in the consolidated financial statements of Cash Management Solutions Limited which are available from C/o Tellermate, Leeway House, Leeway Industrial Estate, Newport, Gwent, NP19 4SL.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -

Revenue comprises sales of electronic business equipment, software and systems together with Tellercover (after sales support). Revenue is usually recognised at the point of dispatch for the sale of equipment (when the significant risks and rewards of ownership of the goods have passed to the buyer the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably) and for Tellercover over the period over which after sales support is provided.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.5
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.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

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
8 years
Patents
8 years
Development costs
Over the period that economic benefits are expected being 8 years
1.6
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:

Plant and equipment
Over 4 - 5 years straight line
Fixtures and fittings
Over 3 - 5 years straight line
Computers
Over 3 years 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.

1.7
Fixed asset investments

Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.8
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.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.9
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.10
Financial instruments

The company 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 company's balance sheet 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.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
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 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.

 

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.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
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.

1.11
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.

1.12
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 profit and loss account 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 profit and loss account, 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.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.13
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.

1.14
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.

1.15
Retirement benefits

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

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors 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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Depreciation and amortisation charges

The company exercises judgement to determine the useful economic lives of tangible fixed assts and intangible fixed assets. Tangible fixed assets are depreciated down to their estimated residual values over their estimated useful lives; Intangible assets are amortised over their estimated useful lives.

Clearly the assessment of estimated useful lives can have a significant impact on the depreciation/amortisation charges.

Impairment of Intangible assets

At 31 December 2023 the carrying value of other intangible assets was £504,898 (2022: £504,835).

 

During the year ended 31 December 2021, management deemed it prudent to account for a provision for impairment for the carrying value of development costs (£1,180,511) and patent costs (£115,534) capitalised within Intangible assets associated with the Live Drawer product. This was given the market disruption associated with the global pandemic. The Board believes that the development costs will reap benefits in future periods, and hence will annually assess if there is a need to reverse the impairment provision.

 

Amortisation of £118,897 was charged in the current year (2022: £111,802) based on the company policy.

 

We concurred with the board that the circumstances were not appropriate at 31 December 2023 to reverse the impairment.

Revenue recognition

Management assesses when it is appropriate to recognise revenue; this assessment can include significant judgement and estimation where arrangements contain multiple elements; judgements are necessary to identify separate units of accounting and to allocate related consideration to each separate unit of accounting.

 

Where the selling price of a product includes an identifiable amount of subsequent service (know as “Telllercover”) the business defers that amount and recognises it as revenue over the period during which the service is performed.

 

The price agreed with some customers often includes an element of Tellecover, that isn’t separately identifiable and therefore not deferred (often refereed to as a “bundled “sale). In other instances, Tellecover is sold separately and is deferred.

 

Management also has to consider commercial terms of sales in circumstances where transactions with customers are complex; for instance, where a customer has requested a “bill and hold” arrangement; in these circumstances management considers whether substantially all of the risks and rewards of ownership have been transferred to the buyer and revenue is only recognised where it can be clearly demonstrated that substantially all of the of the risk and rewards have been transferred.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 19 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Provisions

Provisions have been made for trade debtors and for slow moving and obsolete stock. These provisions are estimated and the actual costs and timing of future cash flows are dependent on future events. The difference between expectations and the actual future liability will be accounted for in the period when such determination is made.

3
Exceptional item

During the year, management reviewed the ageing of all inventory against the group's future order pipeline; as a result provision was made against certain product lines, since despite the group being fully committed to all product ranges the stock holding was higher than anticipated sales of those products in the foreseeable future.

4
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
4,711,887
750,320
Rest of the world
5,489,535
6,404,845
10,201,422
7,155,165
2023
2022
£
£
Other revenue
Interest income
58,446
61,884
R&D expenditure credit
-
5,000
5
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Exchange losses
96,238
83,114
Research and development costs
19,945
21,542
Fees payable to the company's auditor for the audit of the company's financial statements
13,125
12,500
Depreciation of owned tangible fixed assets
48,007
52,945
Amortisation of intangible assets
118,897
111,802
TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
6
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Production
12
9
Selling and distribution
1
3
Administrative
16
19
Research and development
10
11
Marketing
2
2
Total
41
44

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,028,128
1,880,815
Social security costs
180,925
201,237
Pension costs
89,537
93,310
2,298,590
2,175,362
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
565,155
387,322
Company pension contributions to defined contribution schemes
25,317
25,239
590,472
412,561

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 3).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
312,639
160,406
Company pension contributions to defined contribution schemes
12,150
12,113
TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest receivable from group companies
58,446
61,884
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
1,153
-
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
152,499
31,112
Deferred tax
Origination and reversal of timing differences
(25,516)
(295,128)
Adjustment in respect of prior periods
-
0
(19,167)
Total deferred tax
(25,516)
(314,295)
Total tax charge/(credit)
126,983
(283,183)

The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
1,033,489
430,630
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
243,077
81,820
Tax effect of expenses that are not deductible in determining taxable profit
38,716
20,422
Effect of change in corporation tax rate
243
2,183
Group relief
(113,887)
(64,649)
Permanent capital allowances in excess of depreciation
(29,617)
(28,262)
Research and development tax credit
(11,549)
431
Deferred tax adjustments in respect of prior years
-
0
(295,128)
Taxation charge/(credit) for the year
126,983
(283,183)

 

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
11
Intangible fixed assets
Software
Patents
Development costs
Total
£
£
£
£
Cost
At 1 January 2023
283,970
129,249
3,126,145
3,539,364
Additions
-
0
-
0
118,960
118,960
At 31 December 2023
283,970
129,249
3,245,105
3,658,324
Amortisation and impairment
At 1 January 2023
158,122
129,249
2,747,158
3,034,529
Amortisation charged for the year
31,789
-
0
87,108
118,897
At 31 December 2023
189,911
129,249
2,834,266
3,153,426
Carrying amount
At 31 December 2023
94,059
-
0
410,839
504,898
At 31 December 2022
125,848
-
0
378,987
504,835
12
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computers
Total
£
£
£
£
Cost
At 1 January 2023
510,686
50,445
93,854
654,985
Additions
9,670
-
0
1,956
11,626
At 31 December 2023
520,356
50,445
95,810
666,611
Depreciation and impairment
At 1 January 2023
424,071
48,709
80,199
552,979
Depreciation charged in the year
36,997
1,694
9,316
48,007
At 31 December 2023
461,068
50,403
89,515
600,986
Carrying amount
At 31 December 2023
59,288
42
6,295
65,625
At 31 December 2022
86,615
1,736
13,655
102,006
13
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
14
19,324
19,324
TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
14
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Tellermate GmbH
Waldhofer Str. 102, 69123 Heidelberg, Germany
Distribution
Ordinary
100.00

 

15
Stocks
2023
2022
£
£
Raw materials and consumables
600,302
829,355
Work in progress
29,445
55,373
Finished goods and goods for resale
69,899
293,004
699,646
1,177,732

Stocks are stated after provisions for impairment of £523,060 (2022; £110,655)

16
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
3,060,356
671,778
Amounts owed by group undertakings
5,932,684
5,333,122
Other debtors
37,389
76,541
Prepayments and accrued income
89,456
67,420
9,119,885
6,148,861

Within the balance of Amounts owed by group undertakings is an interest bearing balance with Tellermate Inc with a carrying value of £1,487,748 (2022: £1,592,221) which interest of 4% is charged against, this balance is unsecured and has no fixed date of repayment and is repayable on demand. All other balances within Amounts owed by group undertakings are unsecured, interest free and have no fixed date of repayment and are repayable on demand.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
17
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
2,379,442
1,140,987
Amounts owed to group undertakings
1,267,844
542,301
Corporation tax
134,895
1,348
Other taxation and social security
280,384
57,242
Other creditors
31,840
30,818
Accruals and deferred income
666,577
533,954
4,760,982
2,306,650

Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.

18
Provisions for liabilities
2023
2022
£
£
Dilapidation
150,000
150,000
Movements on provisions:
Dilapidation
£
At 1 January 2023 and 31 December 2023
150,000

The provision relates to the company's leasehold property in Newport. It is based on the estimated liability for future obligations regarding dilapidation's under the tenant repairing lease.

19
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
81,657
110,457
Other
(12,591)
(15,875)
69,066
94,582
TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
19
Deferred taxation
(Continued)
- 25 -
2023
Movements in the year:
£
Liability at 1 January 2023
94,582
Credit to profit or loss
(25,516)
Liability at 31 December 2023
69,066
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
89,537
93,310

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.

At the year end the company had outstanding pension contributions of £14,032 (2022: £15,574), this amount being included within creditors due within one year.

21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary share of £1 each
1
1
1
1

There is a single class of ordinary shares. There are no restrictions on dividends and the repayment of capital

22
Financial commitments, guarantees and contingent liabilities

There is an unlimited cross guarantee provided between Tellermate Limited, Tellermate Holdings Limited and Cash Management Solutions Limited to guarantee the bank and other loans in place with Cash Management Solutions Limited.

 

There is a fixed and floating charge in place over the assets of the group. The charges are held by HSBC UK Bank PLC, DBW Investments Limited and BEP Cash Holdings LLC.

 

Priority in terms of recoverability and security of the debt is provided to HSBC UK Bank PLC.

TELLERMATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
23
Operating lease commitments

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
100,299
98,657
Between two and five years
77,799
167,590
In over five years
11,732
30,792
189,830
297,039
24
Related party transactions
Remuneration of key management personnel

Key management personnel are considered to be the senior management and statutory directors who sit on the board of Tellermate. Key management personnel, other than the statutory directors as disclosed in note 8, received remuneration of £254,444 (2022: £227,530).

Transactions with related parties

The company has taken advantage pf exemptions under FRS 102 which mean that transactions between wholly-owned group companies do not have to be disclosed.

25
Ultimate parent undertaking and controlling party

The company's immediate parent undertaking is Tellermate Holdings Limited ("THL"). THL's parent company Cash Management Solutions Limited heads the smallest and largest group in which the results of this company are consolidated. The consolidated financial statements of this group are available from their offices at C/o Tellermate, Leeway House, Leeway Industrial Estate, Newport, Gwent, NP19 4SL.

 

The Ultimate parent company is BEP III LLC.

 

Tellermate Limited is exempt from the requirement to prepare group accounts under section 400 of the Companies Act 2006.

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