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03739088







CNL SOFTWARE LIMITED

DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED
31 DECEMBER 2023

































CNL SOFTWARE LIMITED
 
COMPANY INFORMATION


Directors
G Kellaway 
P Brickley (resigned 15 February 2024)
M Elliott (resigned 15 February 2023)
D Rockvam (appointed 15 February 2024)




Company secretary
G Kellaway



Registered number
03739088



Registered office
100 Avebury Boulevard

Milton Keynes

Buckinghamshire

MK9 1FH




Independent auditors
CLA Evelyn Partners Limited
Statutory Auditor & Chartered Accountants

Level 1 Brockbourne House

77 Mount Ephraim

Tunbridge Wells

TN4 8BS





CNL SOFTWARE LIMITED

CONTENTS



Page
Strategic report
 
 
1 - 4
Directors' report
 
 
5 - 6
Independent auditors' report
 
 
7 - 10
Statement of comprehensive income
 
 
11
Balance sheet
 
 
12
Statement of changes in equity
 
 
13
Notes to the financial statements
 
 
14 - 31


CNL SOFTWARE LIMITED
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Principal activities and business review
 
The principal activity of the Company has continued to be that of the provision of a security integration platform until 31 January 2023. The Company's operations have been integrated into fellow group subsidiary, Everbridge Europe Limited, on 31 January 2023, through a hive up of its trade and assets at this date.
 
The Company as well as Everbridge Europe Limited are owned by Everbridge Inc., a company incorporated in the United States of America. The results of the group are included in the consolidated financial statements of Everbridge Inc. which are available from 25 Corporate Drive, 4th Floor, Burlington, MA 01803. Following the post year-end acquisition by Thoma Bravo, LP, a new ultimate parent company has been put in place, Everbridge Parent, LP.
Everbridge is a global software company that empowers resilience by leveraging intelligent automation technology to enable customers to anticipate, mitigate, respond to, and recover from critical events to keep people safe and organizations running. Boston Consulting Group defines resilience as ‘a company’s capacity to absorb stress, recover critical functionality, and thrive in altered circumstances.’ 
During public safety threats including severe weather conditions, active shooter situations, terrorist attacks or a pandemic, as well as critical business events such as Information Technology outages, cyber-attacks, product recalls or supply-chain interruptions, over 6,500 global customers rely on our Critical Event Management platform to empower their resilience and to quickly and reliably aggregate and assess threat data, locate people at risk and responders able to assist, automate the execution of pre-defined communications processes through the secure delivery to a comprehensive range of different communication channels and devices, and track progress on executing response plans.

Financial risk management objectives and policies
 
There are a number of potential risks and uncertainties that could have a material impact on the performance of the company. The directors and management team regularly identify, monitor and ensure appropriate processes are put in place to mitigate potential risks and uncertainties. These risks include but are not limited to the supply chain, employees, supplier price increases, market competition and general economic conditions. The directors and management team regularly review the financial requirements of the company and the risks associated therewith.

Liquidity risk
 
The company closely monitors its access to bank and other credit facilities in comparison to its outstanding commitments to ensure it has sufficient funds to meet its obligations as they fall due. The group finance function produces regular forecasts which estimate the cash inflows and outflows, month by month, as well as short and long term profit forecasts, so that management can ensure that sufficient financing is in place as it is required.

Economic risk
 
There is always the possibility that an economic downturn will negatively impact the results of the business. The directors and management team regularly identify, monitor and ensure appropriate processes are in place to mitigate risks and uncertainties and the effect of economic downturns on the business.

Page 1

CNL SOFTWARE LIMITED

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Competition risk
 
As a leading company in this industry, there is a threat of competition from other companies. The directors regularly identify, monitor and ensure appropriate processes are in place to mitigate potential risks and uncertainties.
Future Developments
The Company’s operations were integrated into fellow subsidiary undertaking, Everbridge Europe Limited, on 31 January 2023 with a hive-up of the trade and assets of the Company carried out on 31 January 2023. 
This plan is part of a wider group structure simplification in Everbridge. The group directors intended to keep CNL activities and operations as they are, but to be integrated into the larger group entity, which is also based in the UK. The same intention applied to the activities of the UAE element of CNL Software, which was integrated into the newly created UAE branch of Everbridge Europe Limited. Following the completion of the integration, the directors intend to dissolve this Company and to also dissolve CNL Software, Inc, the wholly owned subsidiary undertaking. 
As disclosed in note 2.3 of these financial statements, the directors do not consider the Company to be a going concern and these financial statements have been prepared on a basis other than going concern. 

Financial and other key performance indicators
                                2023                        2022                Variance
   Revenue           £224,431                  £4,351,752               (95%)
   Bookings           £671,540                £4,141,745                36%
   Headcount                6                             51                     (88%)
       
The revenue decreased by 95% year on year between 2022 and 2023 as one month of activity was performed before the hive up in 2023. Similarly, the bookings reflect only the month of January 2023. A comparison month to month is not significant due to the nature of the movements and the miles-stone type of implementations that are not spread equally through the months. Revenue and bookings movements are not always in alignment due to the timing of the provision of the services under each booking. 
Headcount decreased by 88% overall, owing to the transfer of employees over to Everbridge Europe as of 31 January 2023 and a completion in progress during the date of hive-up due to delays in the UAE part of the contract transfer. This was completed by the time we file the accounts with no employees on the company payroll and the directors the only remaining officers. 
 

Page 2

CNL SOFTWARE LIMITED

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Directors' statement of compliance with duty to promote the success of the Company
 
This section forms our Section 172 disclosure, describing how, the directors considered the matters set out in section 172(1)(a) to (f) of the Companies Act 2006. The directors also took into account the views and interests of a wider set of stakeholders, including regulators.
The directors have acted in a way that they considered, in good faith, to be most likely to promote the success of the company and its group for the benefit of its stakeholders, and in doing so had regard, amongst other matters, to: 
•  the likely consequences of any decision in the long term; 
• the need to foster business relationships with suppliers, customers and others; 
•  the impact of the group's operations on the community and the environment; 
•  the desirability of the group maintaining a reputation for high standards of business conduct; and 
•  the need to act fairly as between members of the company.
 
The board of directors has identified the following key stakeholders to be considered in their decisions during the year.
Shareholders
The Company's ultimate parent corporation is Everbridge, Inc. based in Burlington, Massachusetts and formerly listed on the NASDAQ prior to the acquisition by Thoma Bravo in July 2024. The Board works closely with the board of Everbridge, Inc. in meeting the goals of the group as a whole, along with those of the company and its group. 
Employees 
The board encourages employee engagement through forums on site and internationally, surveys, briefings and grant awards to employees to drive staff decisions directly impacting the working environment. Employee safety has been and remains of paramount importance in ensuring appropriate measures have been put into place as a result of the COVID-19 pandemic. 
Suppliers 
Suppliers are a critical link in the overall supply chain for the company, providing a source of value, consistency of quality and service and opportunity for innovation to meet the group's business needs. The Company uses regular reviews for two-way engagement for performance improvement or development of the group's products. 
Customers 
Engagement with customers drives alignment with their values, strategies and priorities and strategic partnerships to help ensure business sustainability and growth. The Company has regular communication and review meetings to agree short, medium and long term goals to develop relationships and ensure continuous improvement. 
Regulatory bodies - Government 
The Group's products are playing a major role in the Government's regulatory bodies' intentions for business resilience and perseverance in their day-to-day operations as well - with this the group makes sure to be up to date with the latest data security and anti-fraud policies to make sure data management regarding all the
Page 3

CNL SOFTWARE LIMITED

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Group's products is impeccable. 
With this the Company aims to enhance business knowledge and compliance. The Company is also working closely together with the government of certain countries to ensure compliance with R&D activity policies as the company received contributions from those countries to help maintain and improve our valuable R&D processes.
Community 
To be engaged in the community is recognised as important both by employees and the board members. Employees of the group are granted additional days-off for community work or any kind of charitable activity based on their preferences. 


This report was approved by the board and signed on its behalf.



G Kellaway
Director

Date: 11 September 2024

Page 4

CNL SOFTWARE LIMITED
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

Directors' responsibilities statement

The directors are responsible for preparing the Strategic report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The loss for the year, after taxation, amounted to £269,316 (2022 - loss £3,039,198).

The Company did not declare or pay a dividend in the year (2022 - £nil).

Directors

The directors who served during the year were:

G Kellaway 
P Brickley (resigned 15 February 2024)
M Elliott (resigned 15 February 2023)

Page 5

CNL SOFTWARE LIMITED
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
  Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events
In February 2024, the ultimate parent company, Everbridge Inc. announced it would be taken private in an all-cash purchase by Thoma Bravo, LP. The acquisition was finalised on 02 July 2024.
There have been no further significant events affecting the Company since the year end.

This report was approved by the board and signed on its behalf.
 



G Kellaway
Director

Date: 11 September 2024

Page 6

CNL SOFTWARE LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CNL SOFTWARE LIMITED

Opinion


We have audited the financial statements of CNL Software Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law.  responsibilities under those standards are further described in the Auditors' 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 United Kingdom, including the Financial Reporting Council'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 - not a going concern


We draw attention to Note 2.3 of the financial statements, which explains that the financial statements have not been prepared on a going concern basis for the reasons set out in that note. Our opinion is not modified in respect of this matter.  

Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual Report.  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.  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.


Page 7

CNL SOFTWARE LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CNL SOFTWARE LIMITED (CONTINUED)

Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


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:


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 5, 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.


Page 8

CNL SOFTWARE LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CNL SOFTWARE LIMITED (CONTINUED)

Auditors' responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' 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 Company 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:
We obtained a general understanding of the Company’s legal and regulatory framework through enquiry of management concerning their understanding of relevant laws and regulations, the entity’s policies and procedures regarding compliance, and how they identify, evaluate and account for litigation claims. We also drew on our existing understanding of the Company’s industry and regulation.
We understand that the Company complies with the framework through:
 
Outsourcing payroll, accounts preparation and tax compliance to external experts. 
Subscribing to relevant updates from external experts, and making changes to internal procedures and controls as necessary.

In the context of the audit, we considered those laws and regulations which determine the form and content of the financial statements, which are central to the company’s ability to conduct its business, and/or where there is a risk that failure to comply could result in material penalties. We identified the following laws and regulations as being of significance in the context of the Company: 
The Companies Act 2006 and FRS 102 in respect of the preparation and presentation of the financial statements. 
Relevant UK taxation laws
 
The senior statutory auditor led a discussion with senior members of the engagement team regarding the susceptibility of the entity’s financial statements to material misstatement, including how fraud might occur. The areas identified in this discussion were: 
Manipulation of the financial statements, especially revenue, via fraudulent journal entries, particularly as the size of the Company means that there is little opportunity for segregation of duties. 
The procedures we carried out to gain evidence in the above areas included:
Testing journal entries, focusing particularly on postings to unexpected or unusual accounts and those posted at unusual times.  

Overall, the senior statutory auditor was satisfied that the engagement team collectively had the appropriate competence and capabilities to identify or recognise irregularities. 


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.


Page 9

CNL SOFTWARE LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CNL SOFTWARE LIMITED (CONTINUED)

Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Jeff Fletcher BA (Hons) FCCA (Senior statutory auditor)
  
for and on behalf of
CLA Evelyn Partners Limited
 
Statutory Auditor
Chartered Accountants
  
Level 1 Brockbourne House
77 Mount Ephraim
Tunbridge Wells
TN4 8BS

Date: 11 September 2024
Page 10

CNL SOFTWARE LIMITED
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
As restated 2022
Note
£
£

  

Turnover
 4 
224,432
4,351,752

Cost of sales
  
(82,020)
(1,434,132)

Gross profit
  
142,412
2,917,620

Administrative expenses
  
(411,728)
(6,160,539)

Operating loss
 5 
(269,316)
(3,242,919)

Interest receivable and similar income
 8 
-
1,125

Interest payable and similar expenses
 9 
-
(8,847)

Loss before tax
  
(269,316)
(3,250,641)

Tax on loss
 10 
-
211,443

Loss for the financial year
  
(269,316)
(3,039,198)

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 14 to 31 form part of these financial statements.

Page 11

CNL SOFTWARE LIMITED
REGISTERED NUMBER:03739088

BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
As restated 2022
Note
£
£

Fixed assets
  

Tangible assets
 11 
-
126,721

Investments
 12 
9
9

  
9
126,730

Current assets
  

Debtors: amounts falling due within one year
 13 
3,053,287
8,426,197

Bank and cash balances
  
-
121,872

  
3,053,287
8,548,069

Creditors: amounts falling due within one year
 14 
-
(5,110,105)

Net current assets
  
 
 
3,053,287
 
 
3,437,964

Total assets less current liabilities
  
3,053,296
3,564,694

Provisions for liabilities
  

Other provisions
 15 
-
(62,567)

  
 
 
-
 
 
(62,567)

Pension liability/asset
 20 
-
(243,143)

Net assets
  
3,053,296
3,258,984


Capital and reserves
  

Called up share capital 
 16 
311,129
311,129

Share premium account
 17 
376,942
376,942

Other reserves
 17 
1,746,221
1,682,593

Profit and loss account
 17 
619,004
888,320

  
3,053,296
3,258,984


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


G Kellaway
Director

Date: 11 September 2024

The notes on pages 14 to 31 form part of these financial statements.

Page 12

CNL SOFTWARE LIMITED

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Share premium account
Other reserves
Profit and loss account
Total equity

£
£
£
£
£


At 1 January 2022
311,129
376,942
898,783
4,357,844
5,944,698

Prior year adjustment - see note 19
-
-
-
(430,326)
(430,326)


At 1 January 2022
311,129
376,942
898,783
3,927,518
5,514,372



Profit for the year
-
-
-
(3,039,198)
(3,039,198)

Share based payments
-
-
881,740
-
881,740

Shares withheld related to net share settlement of stock award
-
-
(97,930)
-
(97,930)



At 1 January 2023
311,129
376,942
1,682,593
1,546,498
3,917,162

Prior year adjustment - see note 19
-
-
-
(658,178)
(658,178)


At 1 January 2022 (as restated)
311,129
376,942
1,682,593
888,320
3,258,984


Comprehensive income for the year

Loss for the year
-
-
-
(269,316)
(269,316)

Share based payments
-
-
82,417
-
82,417

Shares withheld related to net share settlement of stock award
-
-
(18,789)
-
(18,789)


At 31 December 2023
311,129
376,942
1,746,221
619,004
3,053,296


The notes on pages 14 to 31 form part of these financial statements.

Page 13

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

CNL Software Limited is a private company limited by shares incorporated in England and Wales. The registered office and principal place of business is 100 Avebury Boulevard, Milton Keynes, Buckinghamshire, MK9 1FH.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
Monetary amounts in these financial statements are stated in pounds Sterling and are rounded to the nearest whole £1, except where otherwise stated.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Everbridge, Inc. as at 31 December 2023 and these financial statements may be obtained from 25 Corporate Drive, 4th Floor, Burlington, MA01803.

 
2.3

Going concern

Following the hive up of the Company's trade and assets on 31 January 2023, into Everbridge Europe Limited, a fellow group undertaking, the directors intend to strike off the Company after a planned capital reduction. The directors do not therefore consider the Company to be a going concern and these financial statements have been prepared on a basis other than going concern. There are no material adjustments as a result of applying a basis other than going concern.

Page 14

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

 
2.5

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Revenue for licenses and critical driver development is recognised when the software is delivered to the customer (i.e. once the licenses reach "beneficial use" as expected in the context of the arrangement).
Revenue for professional services is recognised upon delivery of the services, using an estimate of the percentage of completion based on the number hours incurred delivering the service against the total estimate hours expected to complete the service.
Revenue for support and maintenace is recognised on a straight line basis over the fixed term of the contract.

 
2.6

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Page 15

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.8

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.

Defined benefit pension plan

The Company operates a defined benefit plan for certain employees. A defined benefit plan defines the pension benefit that the employee will receive on retirement, usually dependent upon several factors including but not limited to age, length of service and remuneration. A defined benefit plan is a pension plan that is not a defined contribution plan.

The liability recognised in the Balance sheet in respect of the defined benefit plan is the present value of the defined benefit obligation at the end of the balance sheet date less the fair value of plan assets at the balance sheet date (if any) out of which the obligations are to be settled.

The defined benefit obligation is calculated using the projected unit credit method. Annually the Company engages independent actuaries to calculate the obligation. The present value is determined by discounting the estimated future payments using market yields on high quality corporate bonds that are denominated in sterling and that have terms approximating to the estimated period of the future payments ('discount rate').

The fair value of plan assets is measured in accordance with the FRS 102 fair value hierarchy and in accordance with the Company's policy for similarly held assets. This includes the use of appropriate valuation techniques.

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to other comprehensive income. These amounts together with the return on plan assets, less amounts included in net interest, are disclosed as 'Remeasurement of net defined benefit liability'.

The cost of the defined benefit plan, recognised in profit or loss as employee costs, except where included in the cost of an asset, comprises:

a) the increase in net pension benefit liability arising from employee service during the period; and

b) the cost of plan introductions, benefit changes, curtailments and settlements.

The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is recognised in profit or loss as a 'finance expense'.

Page 16

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Share-based payments

Share options awarded to employees are recognised at the fair value of the options at the date of grant as determined using the Black-Scholes model and are charged to profit or loss over the vesting period. Other equity based compensation schemes granted to employees, which represent nil cost options, are recognised at the fair value of the equity at the date of grant as determined by the open market price of the shares at the date of grant and are charged to profit or loss over the vesting period. 
All share options and other equity based compensation schemes are settled in the equity of the ultimate parent company, Everbridge, Inc., and a capital contribution is recognised in line with the amounts charged to profit or loss over the vesting period.
Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. 
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the the remaining vesting period is recognised immediately. 
Shares withheld to meet employee's tax liabilities (resulting in a net share settlement of share award) are accounted for as cash settled share based payments.

 
2.10

 National Insurance on share options

To the extent that the share price at the balance sheet date is greater than the exercise price on options granted under unapproved schemes after 19 May 2000, provision for any National Insurance contributions has been made based on the prevailing rate of National Insurance. The provision is accrued over the performance period attaching to the award.

Page 17

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.11

 Current and deferred taxation

Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.12

 Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Leasehold property improvements
-
20%
on cost
Office and computer equipment
-
20%
to 33% on cost

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.13

 Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Page 18

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.14

 Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.15

 Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.

 
2.16

 Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including loans from fellow group undertakings, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.17

 Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in oridinary shares.

Page 19

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgements in applying accounting policies 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.
The following judgements and estimates have had the most significant effect on amounts recognised in the financial statements:
Bad debt provision
The Company makes an estimate of the recoverable value of trade and other debtors. When assessing the impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors, whether the debtor is covered by insurance and historical experience.
Share based payments
The directors assess the estimated forfeiture rate of equity awards granted to employees based on historical and forecasted data relating to the likelihood of achieving any performance related targets as well as employee retention rates.
Revenue recognition
Due to the nature of contract timescales it is routinely necessary to estimate contract costs to complete and future revenues. These are based on all information available to management including the position of contracts at the financial year end and at contract completion and latest correspondence with customers and suppliers, drawing on the experience and opinions of contract managers.
Defined benefit plans
The estimate of the present value of obligations under defined benefit plans relies on actuarial assumptions made by the directors, including the future salary increases and expected service length of  employees in the plan. The directors have made these estimates based on their historical experience of employment practices within the Company and the wider group.

Page 20

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Software licenses
326
1,474,517

Professional services and consultancy
62,764
535,213

Product support and maintenance
161,342
2,342,021

224,432
4,351,751


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
102,777
1,154,164

Rest of Europe
12,356
416,163

Rest of the world
109,299
2,781,424

224,432
4,351,751



5.


Operating loss

The operating loss is stated after charging:

2023
2022
£
£

Depreciation
7,590
52,744

Exchange differences
(501)
(15,930)

Operating lease rentals
13,395
167,717

Equity settled share based payments
82,417
789,534

Cash settled share based payments
18,789
97,930

Auditor's remuneration - Audit fees
12,000
16,000

Page 21

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Employees

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
370,609
5,481,563

Social security costs
40,401
437,365

Cost of defined benefit scheme
-
73,595

Cost of defined contribution scheme
7,913
111,106

418,923
6,103,629


On 31 January 2023, the Company transferred all of its employees (other than the directors) to Everbridge Europe Limited, a fellow 100% owned group company, as part of the hive up of the trade and assets.

The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Employees
6
51

Following the transfer of employees to a fellow group company on 31 January 2023, the only employees in the year were the two directors.


7.


Directors' remuneration


During the year 1 (2022: 1) director was remunerated for qualifying services to the Company along with other group undertakings and it is not possible to separately identify the amount which related to the Company in both the current and prior year.
During the year, retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.
The number of directors who exercised share options during the year was 1 (2022 - 1).
The number of directors who received shares (Restricted Stock and Performance-Based Restricted Stock units) for qualifying services during the year was 1 (2022 - 1).


8.


Interest receivable

2023
2022
£
£


Other interest receivable
-
1,125

Page 22

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Interest payable and similar expenses

2023
2022
£
£


Other interest payable
-
8,847


10.


Taxation


2023
2022
£
£

Corporation tax


Adjustments in respect of previous periods
-
(216,139)


Total current tax
-
(216,139)

Deferred tax


Adjustment in respect of previous periods
-
4,696

Total deferred tax
-
4,696


Taxation on profit/(loss) on ordinary activities
-
(211,443)

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Loss on ordinary activities before tax
(269,316)
(2,592,463)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
(43,959)
(492,568)

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
-
285

Adjustments to tax charge in respect of prior periods
-
(211,443)

Share scheme deductions
-
67,964

Change in unrecognised deferred tax asset
46,725
558,315

Effect of change in corporation tax rate on deferred tax
(2,766)
(133,996)

Total tax charge for the year
-
(211,443)


Factors that may affect future tax charges

Page 23

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
10.Taxation (continued)

As at 31 December 2023, the Company has tax losses of £7,722 (2022 as restated - £2,191,259).

Tax losses of £2,666,103 were transferred to a fellow group company as part of the hive up of the trade and assets in the year.


11.


Tangible fixed assets





Leasehold property improvements
Office and computer equipment
Total

£
£
£





At 1 January 2023
59,608
512,289
571,897


Transfers on hive-across to fellow subsidiary
(59,608)
(509,871)
(569,479)


Disposals
-
(2,418)
(2,418)



At 31 December 2023

-
-
-





At 1 January 2023
59,013
386,163
445,176


Charge for the year on owned assets
-
7,591
7,591


Transfers on hive-across to fellow subsidiary
(59,013)
(393,082)
(452,095)


Disposals
-
(672)
(672)



At 31 December 2023

-
-
-



Net book value



At 31 December 2023
-
-
-



At 31 December 2022
595
126,126
126,721


12.


Fixed asset investments





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2023
9



At 31 December 2023
9




Page 24

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Holding type

Class of shares

Holding

CNL Software, Inc.
155 N Lake Ave, Suite 900, Pasadena, CA 91101, USA
Direct holding
Ordinary
 100%

The directors intend to close the subsidiary undertaking, CNL Software, Inc.


13.


Debtors

2023
As restated 2022
£
£


Trade debtors
-
2,298,761

Amounts owed by group undertakings
3,053,287
5,341,807

Other debtors
-
159,581

Prepayments and accrued income
-
626,048

3,053,287
8,426,197



14.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
-
137,572

Amounts owed to group undertakings
-
2,716,577

Other taxation and social security
-
84,564

Accruals and deferred income
-
2,171,392

-
5,110,105


Page 25

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Provisions





National insurance on equity awards

£





At 1 January 2023
62,567


Transfers on hive-across to fellow subsidiary
(62,567)



At 31 December 2023
-

National insurance on equity awards
This provision represents Employer's National Insurance on the expected exercise of share based payment awards. This provision will be settled upon the exercise of the respective share based payment awards.

Page 26

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



31,112,900 (2022 - 31,112,900) Ordinary shares of £0.01 each
311,129
311,129



17.


Reserves

Share premium account

The excess consideration paid to the Company in respect of share capital above the par value.

Other reserves

The other reserve comprises capital contributions from the ultimate parent company, including amounts in respect of share based payments settled in the equity of the ultimate parent company.

Profit and loss account

The profit and loss reserve represents cumulative profit and loss less any distributions.

Page 27

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


Share-based payments

The Company operates one share based payment sheme; The 2016 Equity Incentive Plan, under which certain employees are granted options to acquire shares in the ultimate parent company, Everbridge Inc.   It is operated using the equity method of settlement accounting. The vesting conditions are based on the contractual terms of the option agreement which is typically four years.  On 31 January 2023, the Company transferred all of its employees to Everbridge Europe Limited, a fellow group company. As a result the sharebased payment obligations were transferred to a different group company.
During the year the Company granted Nil (2022: 70,895) restricted stock units to members of senior management. The shares were to vest after a period of three years from the start date of vesting noted in the award. Units vesting during the year were 1,275 (2022: 16,950) with 41 (2022: 10,162) units forfeited. The number of instruments at the year end was Nil (2022: 54,590).There is no exercise price associated with the restricted stock units and the weighted average fair value per restricted stock unit issued was £ Nil (2022: £45.35).
During the year the Company granted Nil (2022: 13,872) performance-based restricted stock units that vest upon satisfaction of certain performance-based conditions. The performance-based restricted stock units vest based on achieving certain revenue growth thresholds which range from 20% to 40% compounded annual growth over a measurement period of two years for the first 50% of each grant of performance-based restricted stock units and three years for the remaining PSUs. The vesting of the performance-based restricted stock units is subject to the employee’s continued employment through the date of achievement. Units vesting during the year were 203 (2022: 3,910) with 34 (2022: 8,401) units forfeited. The number of instruments at the year end was Nil (2022: 14,533).The share price of common stock on the date of issuance of the performance-based restricted stock units ranged from £20.40 to £121.56 per share. The fair value is based on the value of common stock at the date of issuance and the probability of achieving the performance metric. The directors have assessed the probability of achievement of the award as highly probable based on past performance of achievement of the performance metric. Compensation cost is recognized under the accelerated method and is adjusted in future periods for subsequent changes in the expected outcome of the performance related conditions.
The number and weighted average price of the options are as follows:

Weighted average exercise price (pence)
2023
Number
2023
Weighted average exercise price
(pence)
2022
Number
2022

Outstanding at the beginning of the year

-

69,123

-
 
24,243
 
Granted during the year

-

-

-
 
84,303
 
Forfeited during the year

-

(75)

-
 
(18,563)
 
Exercised during the year

-

(1,478)

-
 
(20,860)
 
Transferred to other group company

-

(67,570)

-
 
-
 
Outstanding at the end of the year
-

-

-
 
69,123
 

Under the scheme, the Nil (2022: 69,123) awards outstanding at 31 December 2023 had no associated exercise price, and a weighted average remaining contractual life of Nil years (2022: 9.007 years).



Page 28

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19.


Prior year adjustment

Bad debts provision
Following a hive-up of assets and trade to fellow subsidiary, Everbridge Europe Limited, in January 2023 the directors have identified that the amount recoverable on trade debtors was overstated in the prior year.  The directors have restated the 2022 results to provide for the bad debts, subsequently trade debtors have been decreased by £658,178, and bad debts expense, included within administrative expenses, increased by £658,178.

Page 29

CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

20.


Pension commitments

The Company operates a Defined benefit pension scheme.

Under Article 51 of the Federal Decree Law no. 33 of 2021, known as the "UAE labour law" non-UAE nationals are entitled to a gratuity payment upon their resignation. This is considered to represent a defined benefit plan. This plan is unfunded and the full obligation is payable upon the resignation of the employee.
No independent actuarial valuation has been carried in relation to this plan and all actuarial assumptions applied have been made by the directors.



Reconciliation of present value of plan liabilities:


2023
2022
£
£

Reconciliation of present value of plan liabilities


At the beginning of the year
243,143
169,548

Current service cost
-
73,595

Transfers on hive-across to fellow subsidiary
(243,143)
-

At the end of the year
-
243,143

2023
2022
£
£


Present value of plan liabilities
-
(243,143)

Net pension scheme liability
-
(243,143)




All employees and associated pension liabilities were transferred to fellow subsidiary, Everbridge Europe Limited, on 31 January 2023.














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CNL SOFTWARE LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

21.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
-
113,397

Later than 1 year and not later than 5 years
-
128,093

-
241,490

On 31 January 2023, the leases formerly held by the Company were novated to a fellow group company as part of the hive up of the trade and assets.


22.


Related party transactions

The Company has taken advantage of the exemption available to it under FRS102 S33.1A and has not
disclosed  transactions  with  other  fellow  group companies  that  are  wholly  owned  by  the  group. 
 


23.


Controlling party

The Company is a wholly owned subsidiary of Everbridge Holdings Limited, a company incorporated in the United Kingdom. Everbridge Holdings Limited in turn is a wholly owned subsidiary of Everbridge, Inc. a company incorporated in the United States of America. The results of the group are included in the consolidated financial statements of Everbridge, Inc. which are available from 25 Corporate Drive, 4th Floor, Burlington, MA01803.
Following the post year-end acquisition by Thoma Bravo, LP a new ultimate parent company has been put in place, Everbridge Parent, LP and the ultimate controlling party became Thoma Bravo, LP.


24.


Group reconstructions

On 31 January 2023, the Company's trade and assets were hived-across into fellow subsidiary, Everbridge Europe Limited, at net book value.


25.


Post balance sheet events

In February 2024, the ultimate parent Company, Everbridge Inc., announced it would be taken private in an all-cash purchase by Thoma Bravo, LP. The acquisition was finalised on 02 July 2024.

 
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