Year Ended
Registration number:
Artefact UK Ltd
Contents
Company Information |
|
Strategic Report |
|
Directors' Report |
|
Statement of Directors' Responsibilities |
|
Independent Auditor's Report |
|
Income Statement |
|
Statement of Comprehensive Income |
|
Statement of Financial Position |
|
Statement of Changes in Equity |
|
Statement of Cash Flows |
|
Notes to the Financial Statements |
Artefact UK Ltd
Company Information
Directors |
G M P De Roquemaurel P E Coggia |
Registered office |
|
Auditors |
|
Artefact UK Ltd
Strategic Report for the Year Ended 31 December 2023
The directors present their strategic report for the year ended 31 December 2023.
Fair review of the business
In the upcoming years, our company is steadfast in its commitment to achieving significant growth while maintaining high profit margins, ensuring client satisfaction, and adhering to sustainable business practices. Our primary objectives for the next 1-2 years centre around aggressive market expansion and revenue growth. We aim to solidify our position in the industry by increasing our market share and ensuring that our clients receive exceptional value and service.
Looking further ahead, our goals for the next 3-5 years include establishing a well-recognized brand in AI and Data consulting and positioning ourselves as market leaders. We plan to build a sustainable client base that will drive long-term business growth. These objectives align seamlessly with our mission of delivering innovative solutions and our vision of becoming a trusted leader in the AI and Data consulting industry. A strategic move towards achieving these goals is our planned merger with Arca Blanca in 2024, which will significantly expand our client base and unlock new growth opportunities.
Over the past year, we have achieved several significant milestones. We have successfully completed numerous high-profile projects in AI and Data consulting, delivering substantial value to our clients. Additionally, our client acquisition efforts have been fruitful, adding many prestigious clients to our portfolio and strengthening our market position.
The current trends in the industry underscore the increasing integration of AI across various sectors and the growing reliance on data analytics for strategic decision-making. As a company, we are well-positioned to capitalize on these trends due to our strong expertise in AI and Data consulting and our reputation for delivering innovative and effective solutions. Our unique selling points include customizable solutions tailored to client needs, high client satisfaction, and a steadfast commitment to sustainability.
Our strategic initiatives are designed to further bolster our market position. We are actively developing new models to enhance our service offerings and are working on bespoke data solutions for key clients to address their unique challenges. The planned merger with Arca Blanca is a significant future project that will expand our client base and enhance our growth potential.
Going concern
In preparing and approving these financial statements the Board have given due consideration to going concern risks including the impact of the coronavirus pandemic.
For the year ended 31 December 2023, the company made a profit of £1,715k (2022: £3,168k). This included costs that were considered one off and exceptional of £432k (2022: £36k) following restructuring within the company.
The Company expects a profit for the coming year and a positive EBITDA.
Principal risks and uncertainties
Risk management is a critical aspect of our strategic planning. We have identified key risks such as increasing market competition, rapid technological changes, and economic factors that could impact client budgets. To mitigate these risks, we are committed to continuous innovation, developing flexible strategies to adapt to technological changes, and maintaining a diversified client base to reduce the impact of economic downturns.
Artefact UK Ltd
Strategic Report for the Year Ended 31 December 2023
Future developments
Looking to the future, we foresee numerous growth opportunities, including expanding into more industries. However, we also anticipate challenges such as scaling operations while maintaining quality and client satisfaction and keeping up with rapid technological advancements. Our strategic plans for the next year include successfully integrating Arca Blanca to maximize synergies and growth potential, continuously enhancing our service offerings to meet evolving client needs, and strengthening our sustainability initiatives to align with industry trends and client expectations.
In summary, our strategic objectives, achievements, market analysis, ongoing and future initiatives, risk management strategies, and future outlook are aligned to ensure sustainable growth and market leadership in the AI and Data consulting industry. We remain committed to delivering exceptional value to our clients while maintaining high standards of sustainability and innovation.
Approved by the
......................................... |
Artefact UK Ltd
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 of the company
The directors, who held office during the year, were as follows:
Financial instruments
Objectives and policies
The company has no borrowings other than intragroup loans from its parent companies and fellow subsidiaries.
The Directors continue to monitor and, where appropriate, take necessary action to minimise the Company's risk to interest and exchange rate exposure and to ensure sufficient working capital exists for the Company to operate efficiently.
Further details of the company's policy on financial instruments and management of financial risk are included in note 23 to the accounts.
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information (information needed by the company's auditors in connection with preparing their report) and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware. This confirmation is given and should be interpreted in accordance with the provisions of Section 418 of the Companies Act 2006.
Approved by the
......................................... |
Artefact UK Ltd
Statement of Directors' Responsibilities
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 International Financial Reporting Standards (IFRSs) as adopted by the European Union. 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 in accordance with IAS 8: 'Accounting Policies, Changes in Accounting Estimates and Errors' and apply them consistently; |
• | present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information; |
• | provide additional disclosures when compliance with the specific requirements in IFRSs is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the company's financial position and financial performance; |
• | make judgements and accounting estimates that are reasonable and prudent; |
• | state whether applicable IFRSs as adopted by the European Union have been followed, subject to any material departures disclosed and explained in the financial statements; and |
• | 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 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.
Artefact UK Ltd
Independent Auditor's Report to the Members of Artefact UK Ltd
Opinion
We have audited the financial statements of Artefact UK Ltd (the 'company') for the year ended 31 December 2023, which comprise the Income Statement, Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK adopted International Financial Reporting Standards (IFRSs).
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 profit for the year then ended; |
• | have been properly prepared in accordance with UK adopted IFRSs; 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. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Artefact UK Ltd
Independent Auditor's Report to the Members of Artefact UK Ltd
Opinion on other matter 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
• |
the Strategic Report and 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 our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors' Report.
We have nothing to report in respect of the following matters where 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 Statement of Directors' Responsibilities [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.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Artefact UK Ltd
Independent Auditor's Report to the Members of Artefact UK Ltd
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our commercial and sector experience and through discussions with the directors and other management. We discussed with the directors and other management the policies and procedures regarding compliance throughout the audit and have reviewed board minutes and any relevant correspondence with regulator bodies. We communicated identified laws and regulations throughout our team and remained alert to any indications of non compliance throughout the audit.
The potential effect of these laws and regulations on the financial statements varies significantly. The company is subject to laws that directly affect the financial statements including financial reporting and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures.
The company is subject to other laws and regulations where the consequences of non compliance could have an effect on the amounts or disclosures in the financial statements, for instance the result of a litigation claim. We identified the following areas as those most likely to have an effect: employment law, consumer and business protection marketing regulations, health and safety, data protection and company legislation.
Auditing standards limit the required audit procedures to identify non compliance with these laws and regulations to enquiry with the directors and other management and review of legal correspondence if any. Through such procedures, we did not identify any actual or suspected non compliance. Owing to the inherent limitations of an audit, there is an unavoidable risk that we have not detected some material misstatements in the financial statements.
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 2006. Our 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 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 members as a body, for our audit work, for this report, or for the opinions we have formed.
......................................
For and on behalf of
Lowin House
Tregolls Road
Cornwall
TR1 2NA
Artefact UK Ltd
Income Statement
Year Ended 31 December 2023
Note |
2023 |
2022 |
|
Revenue |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Operating profit |
|
|
|
Finance income |
|
|
|
Finance costs |
( |
- |
|
Net finance income |
|
|
|
Profit before tax |
|
|
|
Income tax expense |
- |
( |
|
Profit for the year |
|
|
The above results were derived from continuing operations.
Artefact UK Ltd
Statement of Comprehensive Income
Year Ended 31 December 2023
2023 |
2022 |
|
Profit for the year |
|
|
Total comprehensive income for the year |
|
|
Artefact UK Ltd
Statement of Financial Position
31 December 2023
Note |
31 December |
31 December |
|
Assets |
|||
Non-current assets |
|||
Property, plant and equipment |
|
|
|
Intangible assets |
|
|
|
Right of use assets |
- |
683,900 |
|
|
|
||
Current assets |
|||
Trade and other receivables |
|
|
|
Contract Assets |
|
|
|
Cash and cash equivalents |
|
|
|
|
|
||
Total assets |
|
|
|
Equity and liabilities |
|||
Equity |
|||
Share capital |
( |
( |
|
Share premium |
( |
( |
|
Capital redemption reserve |
( |
( |
|
Retained earnings |
( |
( |
|
Total equity |
( |
( |
|
Non-current liabilities |
|||
Provisions |
( |
- |
|
Lease liabilities |
- |
(175,860) |
|
( |
( |
||
Current liabilities |
|||
Trade and other payables |
( |
( |
|
Contract liabilities |
( |
( |
|
Income tax liability |
|
( |
|
Lease liabilities |
- |
(517,810) |
|
( |
( |
||
Total liabilities |
( |
( |
|
Total equity and liabilities |
( |
( |
Artefact UK Ltd
Statement of Financial Position
31 December 2023
Approved by the
.........................................
P E Coggia
Director
Company registration number: 03538849
Artefact UK Ltd
Statement of Changes in Equity
Year Ended 31 December 2023
Share capital |
Share premium |
Capital redemption reserve |
Retained earnings |
Total |
|
At 1 January 2023 |
|
|
|
|
|
Profit for the year |
- |
- |
- |
|
|
Total comprehensive income |
- |
- |
- |
|
|
At 31 December 2023 |
|
|
|
|
|
Share capital |
Share premium |
Capital redemption reserve |
Retained earnings |
Total |
|
At 1 January 2022 |
|
|
|
|
|
Profit for the year |
- |
- |
- |
|
|
Total comprehensive income |
- |
- |
- |
|
|
At 31 December 2022 |
1,882 |
696,749 |
18 |
5,851,812 |
6,550,461 |
Artefact UK Ltd
Statement of Cash Flows
Year Ended 31 December 2023
Note |
2023 |
2022 |
|
Cash flows from operating activities |
|||
Profit for the year |
|
|
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
(Profit)/loss on disposal of property plant and equipment |
( |
|
|
Finance income |
( |
( |
|
Finance costs |
|
- |
|
Income tax expense |
- |
|
|
|
|
||
Working capital adjustments |
|||
(Increase)/decrease in trade and other receivables and contract assets |
( |
|
|
Increase/(decrease) in trade and other payables and contract liabilities |
|
( |
|
Increase in provisions |
|
- |
|
Increase/(decrease) in deferred income, including government grants |
|
( |
|
Cash generated from operations |
|
|
|
Income taxes paid |
( |
( |
|
Net cash flow from operating activities |
|
|
|
Cash flows from investing activities |
|||
Interest received |
|
|
|
Acquisitions of property plant and equipment |
( |
( |
|
Proceeds from sale of property plant and equipment |
|
( |
|
Net cash flows from investing activities |
|
( |
|
Cash flows from financing activities |
|||
Interest paid |
( |
- |
|
Repayment of lease liabilities |
( |
( |
|
Net cash flows from financing activities |
( |
( |
|
Net (decrease)/increase in cash and cash equivalents |
(60,034) |
2,164,083 |
|
Cash and cash equivalents at 1 January |
6,129,788 |
3,965,705 |
|
Cash and cash equivalents at 31 December |
6,069,754 |
6,129,788 |
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
General information |
The company is a private company limited by share capital incorporated and domiciled in UK. It's parent company is detailed in note 26.
With effect from 10 February 2024, the name of the Company was changed from Artefact Marketing Engineers UK Limited to Artefact UK Ltd.
The address of its registered office and principal place of business is:
The financial statements have been presented in British Pounds Sterling, rounded to the nearest Pound, as this is the currency of the primary economic environment in which the company operates.
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Basis of preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards and its interpretations adopted by the EU ("adopted IFRS's") and are applied in accordance with the Companies Act 2006 under historical cost accounting rules, except for certain financial instruments that are measured at fair values as explained below. Historic cost is based on the fair value of the consideration given in exchange for assets.
These financial statements are the separate financial statements of Artefact UK Ltd. The IFRS compliant consolidated financial statements of parent, Artefact SAS, are publicly available at:
19 rue Richer
75009
Paris
France
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Going concern
In preparing and approving these financial statements the Board have given due consideration to going concern risks.
For the year ended 31 December 2023, the company made a profit of £1,715k (2022: £3,168k). This included costs that were considered one off and exceptional of £432k (2022: £36k) following restructuring within the company.
The Company expects a profit for the coming year and a positive EBITDA.
Revenue recognition
Recognition
The company earns revenue from the provision of services relating to providing a range of digital marketing and consultancy services. This revenue is recognised in the accounting period when the services are rendered at an amount that reflects the consideration to which the entity expects to be entitled in exchange for fulfilling its performance obligations to customers.
The principles in IFRS are applied to revenue recognition criteria using the following 5 step model:
1. Identify the contracts with the customer
2. Identify the performance obligations in the contract
3. Determine the transaction price
4. Allocate the transaction price to the performance obligations in the contract
5. Recognise revenue when or as the entity satisfies its performance obligations
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Fee arrangements
Below are details of fee arrangements and how these are measured and recognised, for revenue from the provision of services:
• |
For fixed fee arrangements from services revenue revenue is recognised based on the stage of completion and performance obligations met for actual services provided as a proportion of the total fixed fee agreed in the contract. |
• |
For fee for service (time & materials) revenue is recognised by reference to services performed and time costs on the contract to the year end date using contractual rates specified in the contract. |
The main performance obligations in contracts consist of delivering marketing strategies. For all contracts the stage of completion and delivery of performance obligations are measured at the balance sheet date by reviewing marketing activity from third party reports and from time costs incurred.
Transaction price
To calculate the transaction price of contracts this is a fee based on marketing activity or for time and costs spent to deliver a project-
- the transaction price for variable payments is based on management’s assessment of the most likely amount of consideration;
- the transaction price of fixed fee contracts is determined by the fee specified in contract, and
- the transaction price for fee for service contracts is at rates specified in the contract.
Where discounts to the contract price are applied the company presents these as a discount from contract revenue at the point in time the discount terms are met by the customer.
Principal versus agent
The company has arrangements whereby it needs to determine if it acts as a principal or an agent as more than one party is involved in providing the goods and services to the customer. The company acts as a principal if it controls a promised good or service before transferring that good or service to the customer. The company is an agent if its role is to arrange for another entity to provide the goods or services. Factors considered in making this assessment are most notably the discretion the company has in establishing the price for the specified good or service, whether the company has inventory risk and whether the company is primarily responsible for fulfilling the promise to deliver the service or good.
This assessment of control requires judgement in particular in relation to certain service contracts. An example, is the provision of certain marketing activity where the company may be assessed to be agent or principal dependent upon the facts and circumstances of the arrangement and the nature of the services being delivered.
Where the company is acting as a principal, revenue is recorded on a gross basis. Where the company is acting as an agent revenue is recorded at a net amount reflecting the margin earned.
For some media transactions, the Company is an agent on behalf of clients and books net revenue without the pass-through media costs. For other media transactions and consulting-data activities, the company acts as a principal.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Contract assets and receivables
Where goods or services are transferred to the customer before the customer pays consideration, or before payment is due, contract assets are recognised. Contract assets are included in the statement of financial position and represent the right to consideration for services delivered.
Contract receivables are recognised in the statement of financial position when the company’s right to consideration becomes unconditional. This is where services have been provided for upfront and payment for such services is due from the customer.
Contract assets & receivables are classified as current or non- current based on the company’s normal operating cycle and are assessed for impairment at each reporting date.
Contract liabilities
Contract liabilities and customer deposits are recognised in the statement of financial position when the company has received consideration but still has an obligation to deliver services and meet performance obligations for that consideration.
Net basis of measurement of contract balances
Contract asset and contract liability positions are determined for each contract on a net basis. This is because the rights and obligations within each contract are considered inter-dependent. Where two contracts are with the same or related entities, an assessment is made of whether contract assets and liabilities are inter-dependent and if so, contract balances are reported net.
Foreign currency transactions and balances
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted by the balance sheet date.
Deferred tax is provided in full using the balance sheet liability method for all taxable temporary differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes. Deferred tax is measured using currently enacted or substantially enacted tax rates.
Deferred tax assets are recognised to the extent the temporary difference will reverse in the foreseeable future and that it is probable that future taxable profit will be available against which the asset can be utilised.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Property, plant and equipment
Property, plant and equipment is stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of property, plant and equipment includes directly attributable incremental costs incurred in their acquisition and installation.
The carrying values of property, plant and equipment are reviewed for impairment if events or changes in circumstances indicate the carrying value may not be recoverable, and are written down immediately to their recoverable amount. Useful lives and residual values are reviewed annually and where adjustments are required these are made prospectively.
Depreciation
An annual assessment of residual values is performed and there is no depreciable amount if residual values are the same as, or more than, book value. Residual values are based on the estimated amount which would be currently obtainable from disposal of the asset net of disposal costs if the asset were already of the age and condition expected at the end of its useful life.
Depreciation is charged so as to write off the cost of assets less residual value over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Leasehold improvements |
Straight line over the life of the lease |
Plant and machinery |
33.3% straight line |
Furniture and fittings |
20% straight line |
Intangible assets
Intangible assets with finite useful lives that are acquired separately such as trademarks are valued at cost less accumulated amortisation and accumulated impairment losses.
Websites are capitalised on the basis that they can generate probable future economic benefit.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their expected useful economic life as follows:
Asset class |
Amortisation method and rate |
Trademarks |
5% straight line |
Website |
33% straight line |
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.
Trade payables are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
Provisions
Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
Provisions are measured at the directors’ best estimate of the expenditure required to settle the obligation at the reporting date and are discounted to present value where the effect is material.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a separate entity and has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
For defined contribution plans, contributions are paid through publicly or privately administered pension insurance plans on a mandatory or contractual basis. The contributions are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as an asset.
Related parties
The company discloses transactions with related parties which are not wholly owned within the same group.
Transactions of a similar nature are aggregated unless, in the opinion of the directors, separate disclosure is required in order to understand the transactions and their impact on the financial statements of the company.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Financial instruments
Initial recognition
Financial assets and financial liabilities comprise all assets and liabilities reflected in the statement of financial position, although excluding property, plant and equipment, intangible assets, deferred tax assets, and prepayments.
The company recognises financial assets and financial liabilities in the statement of financial position when, and only when, the company becomes party to the contractual provisions of the financial instrument.
Financial assets are initially recognised at fair value. Financial liabilities are initially recognised at fair value, representing the proceeds received net of premiums, discounts and transaction costs that are directly attributable to the financial liability.
All regular way purchases and sales of financial assets and financial liabilities classified as fair value through profit or loss (“FVTPL”) are recognised on the trade date, i.e. the date on which the company commits to purchase or sell the financial assets or financial liabilities. All regular way purchases and sales of other financial assets and financial liabilities are recognised on the settlement date, i.e. the date on which the asset or liability is received from or delivered to the counterparty. Regular way purchases or sales are purchases or sales of financial assets that require delivery within the time frame generally established by regulation or convention in the market place.
Subsequent to initial measurement, financial assets and financial liabilities are measured at either amortised cost or fair value.
Classification and measurement
Financial instruments are classified at inception into one of the following categories, which then determine the subsequent measurement methodology:-
Financial assets are classified into one of the following three categories:-
· financial assets at amortised cost;
· financial assets at fair value through other comprehensive income (FVTOCI); or
· financial assets at fair value through the profit or loss (FVTPL).
Financial liabilities are classified into one of the following two categories:-
· financial liabilities at amortised cost; or
· financial liabilities at fair value through the profit or loss (FVTPL).
The classification and the basis for measurement are subject to the company’s business model for managing the financial assets and the contractual cash flow characteristics of the financial assets, as detailed below:-
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Financial assets at amortised cost
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:-
· the assets are held within a business model whose objective is to hold assets in order to collect contractual cash flows; and
· the contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
If either of the above two criteria is not met, the financial assets are classified and measured at fair value through the profit or loss (FVTPL).
If a financial asset meets the amortised cost criteria, the company may choose to designate the financial asset at FVTPL. Such an election is irrevocable and applicable only if the FVTPL classification significantly reduces a measurement or recognition inconsistency.
Financial assets at fair value through other comprehensive income (FVTOCI)
A financial asset is measured at FVTOCI only if it meets both of the following conditions and is not designated as at FVTPL:-
· the asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and
· the contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
On initial recognition of an equity investments that is not held for trading, the company may irrevocably elect to present subsequent changes in fair value in OCI. This election is made on an investment-by-investment basis.
If an equity investment is designated as FVTOCI, all gains and losses, except for dividend income, are recognised in other comprehensive income and are not subsequently included in the statement of income.
Financial assets at fair value through the profit or loss (FVTPL)
Financial assets not otherwise classified above are classified and measured as FVTPL.
Financial liabilities at amortised cost
All financial liabilities, other than those classified as financial liabilities at FVTPL, are measured at amortised cost using the effective interest rate method.
Financial liabilities at fair value through the profit or loss
Financial liabilities not measured at amortised cost are classified and measured at FVTPL. This classification includes derivative liabilities.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Derecognition
Financial assets
The company derecognises a financial asset when;
- the contractual rights to the cash flows from the financial asset expire,
- it transfers the right to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred; or
- the company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.
On derecognition of a financial asset, the difference between the carrying amount of the asset and the sum of the consideration received is recognised as a gain or loss in the profit or loss.
Any cumulative gain or loss recognised in OCI in respect of equity investment securities designated as FVTOCI is not recognised in profit or loss on derecognition of such securities. Any interest in transferred financial assets that qualify for derecognition that is created or retained by the company is recognised as a separate asset or liability.
The company enters into transactions whereby it transfers assets recognised on its statement of financial position, but retains either all or substantially all of risks and rewards of the transferred assets or a portion of them. In such cases, the transferred assets are not derecognised.
When the company derecognises transferred financial assets in their entirety, but has continuing involvement in them then the entity should disclose for each type of continuing involvement at the reporting date:
(a) The carrying amount of the assets and liabilities that are recognised in the entity’s statement of financial position and represent the entity’s continuing involvement in the derecognised financial assets, and the line items in which those assets and liabilities are recognised.
(b) The fair value of the assets and liabilities that represent the entity’s continuing involvement in the derecognised financial assets;
(c) The amount that best represents the entity’s maximum exposure to loss from its continuing involvement in the derecognised financial assets, and how the maximum exposure to loss is determined
(d) The undiscounted cash outflows that would or may be required to repurchase the derecognised financial assets or other amounts payable to the transferee for the transferred assets
Financial liabilities
The company derecognises a financial liability when its contractual obligations are discharged, cancelled, or expire.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Modification of financial assets and financial liabilities
Financial assets
If the terms of a financial asset are modified, the company evaluates whether the cash flows of the modified asset are substantially different. If the cash flows are substantially different, then the contractual rights to the cash flows from the original financial asset are deemed to expire. In this case the original financial asset is derecognised and a new financial asset is recognised at either amortised cost or fair value.
If the cash flows are not substantially different, then the modification does not result in derecognition of the financial asset. In this case, the company recalculates the gross carrying amount of the financial asset and recognises the amount arising from adjusting the gross carrying amount as a modification gain or loss in the statement of income.
Financial liabilities
If the terms of a financial liabilities are modified, the company evaluates whether the cash flows of the modified asset are substantially different. If the cash flows are substantially different, then the contractual obligations from the cash flows from the original financial liabilities are deemed to expire. In this case the original financial liabilities are derecognised and new financial liabilities are recognised at either amortised cost or fair value.
If the cash flows are not substantially different, then the modification does not result in derecognition of the financial liabilities. In this case, the company recalculates the gross carrying amount of the financial liabilities and recognises the amount arising from adjusting the gross carrying amount as a modification gain or loss in the statement of income.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Impairment of financial assets
Measurement of Expected Credit Losses
The company recognises loss allowances for expected credit losses (ECL) on financial instruments that are not measured at FVTPL, namely:
- Financial assets that are debt instruments
- Accounts and other receivables
- Financial guarantee contracts issued; and
- Loan commitments issued.
The company classifies its financial instruments into stage 1, stage 2 and stage 3, based on the applied impairment methodology, as described below:
Stage 1: for financial instruments where there has not been a significant increase in credit risk since initial recognition and that are not credit-impaired on origination, the company recognises an allowance based on the 12-month ECL.
Stage 2: for financial instruments where there has been a significant increase in credit risk since initial recognition but they are not credit-impaired, the company recognises an allowance for the lifetime ECL.
Stage 3: for credit-impaired financial instruments, the company recognises the lifetime ECL.
The company measures loss allowances at an amount equal to the lifetime ECL, except for the following, for which they are measured as a 12-month ECL:
- debt securities that are determined to have a low credit risk (equivalent to investment grade rating) at the reporting date; and
- other financial instruments on which the credit risk has not increased significantly since their initial recognition.
The company considers a debt security to have low credit risk when their credit risk rating is equivalent to the globally understood definition of ‘investment grade’.
A 12-month ECL is the portion of the ECL that results from default events on a financial instrument that are probable within 12 months from the reporting date.
Provisions for credit-impairment are recognised in the statement of income and are reflected in accumulated provision balances against each relevant financial instruments balance.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Evidence that the financial asset is credit-impaired include the following;
- Significant financial difficulties of the borrower or issuer;
- A breach of contract such as default or past due event;
- The restructuring of the loan or advance by the company on terms that the company would not consider otherwise;
- It is becoming probable that the borrower will enter bankruptcy or other financial reorganisation;
- The disappearance of an active market for the security because of financial difficulties; or
- There is other observable data relating to a group of assets such as adverse changes in the payment status of borrowers or issuers in the company, or economic conditions that correlate with defaults in the company.
For trade receivables, the company applies the simplified approach, which requires expected lifetime losses to be recognised from initial recognition of the receivables.
To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared credit risk characteristics and the days past due. The contract assets relate to unbilled work in progress and have substantially the same risk characteristics as the trade receivables for the same types of contracts. The company has therefore concluded that the expected loss rates for trade receivables are a reasonable approximation of the loss rates for the contract assets.
The expected loss rates are based on the payment profiles of sales over a period of 36 month before 31 December 2023 and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables. The company has identified the GDP and the unemployment rate of the countries in which it sells its goods and services to be the most relevant factors, and accordingly adjusts the historical loss rates based on expected changes in these factors.
Derivative financial instruments
Derivative financial instruments are contracts, the value of which is derived from one or more underlying financial instruments or indices, and include futures, forwards, swaps and options in the interest rate, foreign exchange, equity and credit markets.
Derivative financial instruments are recognised in the statement of financial position at fair value. Fair values are derived from prevailing market prices, discounted cash flow models or option pricing models as appropriate.
In statement of financial position, derivative financial instruments with positive fair values (unrealised gains) are included as assets and derivative financial instruments with negative fair values (unrealised losses) are included as liabilities.
The changes in the fair values of derivative financial instruments entered into for trading purposes are included in trading income.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Hedge accounting
Derivatives held for risk management purposes include all derivative assets and liabilities that are not classified as trading assets and liabilities.
The company designates certain derivatives held for risk management as well as certain non-derivative financial instruments as hedging instruments in qualifying hedging relationships. On initial designation of the hedge, the company formally documents the relationship between the hedging instruments and hedge items, including the risk management objective and strategy in undertaking the hedge, together with the method that will be used to assess the effectiveness of the hedging relationship. The company makes an assessment, both at inception of the hedge relationship and on an ongoing basis, of whether the hedging instruments are expected to be highly effective in offsetting that changes in the fair value or cash flows of the respective hedged items during the period for which the hedge is designated.
These hedging relationships are discussed below.
Fair value hedges
When a derivative is designated as the hedging instrument in a hedge of the change in fair value of a recognised assets or liability or a firm commitment that could affect profit or loss, changes in the fair value of the derivative are recognised immediately in profit or loss, together with changes in the fair value of the hedged item that are attributable to the hedged risk (in the same line item in the statement of profit or loss and OCI as the hedged item).
If hedging derivatives expire or are sold, terminated or exercised, or the hedge no longer meets the criteria for fair value hedge accounting, or the hedge designation is revoked, then hedge accounting is discontinued prospectively. However, if the derivative is novated to a central clearing counterparty by both parties as a consequence of laws or regulations without changes in its terms except for those that are necessary for the novation, then the derivative is not considered expired or terminated.#
Any adjustment up to the point of discontinuation of a hedged item for which the effective interest method is used is amortised to profit of loss as part of the recalculated effective interest rate of the item over its remaining life.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Cash flow hedges
The company makes an assessment for a cash flow hedge of a forecast transaction, of whether the forecast transaction is highly probable to occur and presents an exposure to variations in cash flows that could ultimately affect profit or loss.
When a derivative is designated as the hedging instrument in a hedge of the variability in cash flows attributable to a particular risk associated with a recognised asset or liability that could affect profit or loss, then the effective portion of changes in the fair value of the derivative is recognised in OCI and presented in the hedging reserve within equity. Any ineffective portion of changes in the fair value of the derivative is recognised immediately in profit or loss. The amount recognised in OCI is reclassified to profit or loss as a reclassification adjustment in the same period as the hedged cash flows affect profit or loss, and in the same line item in the statement of profit or loss and OCI.
If the hedging derivative expires or is sold, terminated or exercised, or the hedge no longer meets the criteria for cash flow hedge accounting, or the hedge designation is revoked, then hedge accounting is discontinued prospectively. However, if the derivative is novated to a central clearing counterparty by both parties as a consequence of laws or regulations without changes in its terms except for those that are necessary for the novation, then the derivative is not considered expired or terminated.
Hedges of a net investment in a foreign operation
When a derivative instrument or a non-derivative financial liability is designated as the hedging instrument in a hedge of a foreign investment, the effective portion of changes in the fair value of the hedging instrument is recognised in OCI and presented as a separate reserve within equity.
Any ineffective portion of the changes in the fair value of the hedge instrument is recognised immediately in profit or loss. The amount recognised in OCI is reclassified to profit or loss as a reclassification adjustment on disposal of the foreign investment.
Accounting estimates and assumptions
The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of certain financial assets, liabilities, income and expenses.
The use of estimates and assumptions is principally limited to the determination of provisions for impairment, the valuation of financial assets and liabilities as explained in more detail below:-
Provisions for impairment
In determining impairment of financial assets, judgement is required in the estimation of the amount and timing of future cash flows as well as an assessment of whether the credit risk on the financial asset has increased significantly since initial recognition and incorporation of forward-looking information in the measurement of ECL.
Fair value of financial assets and liabilities
Where the fair value of financial assets and liabilities cannot be derived from active markets, they are determined using a variety of valuation techniques that include the use of mathematical models. The input to these models is derived from observable markets where available, but where this is not feasible, a degree of judgement is required in determining assumptions used in the models. Changes in assumptions used in the models could affect the reported fair value of financial assets and liabilities.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Agent versus Principal
The notion of control has changed the assessment of the roles of Agent and Principal. Under the new revenue standards, when a third party is involved in providing services to a customer, the Company must determine if its performance obligation is to provide the service itself (i.e; the Company is principal and therefore records revenue and related expenses on a gross basis) or to arrange for another party to provide service (i.e. the Company is an agent and records as revenue the net amount it retains as a commission).
For some media transactions, the Company is an agent on behalf of clients and books net revenue without the pass-through media costs. For other media transactions and consulting-data activities, the company acts as a principal. Judgement is required to determine the transactions that are treated as agent and principal.
Exemption from preparing group accounts
The financial statements contain information about Artefact UK Ltd as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under section 400 of the Companies Act 2006 from the requirement to prepare consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the consolidated financial statements of its parent, Artefact SAS, a company incorporated in France.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Critical accounting judgements and key sources of estimation uncertainty |
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company's accounting policies.
Deferred income
A judgement has been made in determining the contracts on which income should be deferred and an estimate has been made on the stage of completion at the year end based upon chargeable time spent during the year. Deferred income in 2023 amounted to £691,385 (2022: £661,272).
|
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Revenue |
The analysis of the company's revenue for the year from continuing operations is as follows:
2023 |
|
|
Rendering of services |
|
|
2023 |
2022 |
|
Geographical market |
||
UK |
7,357,863 |
5,150,630 |
Europe |
1,405,105 |
5,342,939 |
Rest of the World |
4,568,197 |
3,418,903 |
13,331,165 |
13,912,472 |
Operating profit |
Arrived at after charging/(crediting)
2023 |
2022 |
|
Depreciation expense |
|
|
Amortisation expense |
|
|
Depreciation on right of use assets |
427,438 |
441,282 |
Foreign exchange losses / (gains) |
|
|
Operating lease expense - property |
|
|
(Profit)/loss on disposal of property, plant and equipment |
( |
|
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Finance income and costs |
2023 |
2022 |
|
Finance income |
||
Interest income on bank deposits |
|
|
Finance costs |
||
Interest on bank overdrafts and borrowings |
( |
- |
Net finance income |
|
|
Exceptional items |
Items which are material either because of their size or their nature, or which are non-recurring, are presented within their relevant income statement category. The separate reporting of exceptional items helps provide a better picture of the company's underlying performance.
An analysis of the amounts presented as exceptional items in these financial statements is given below and is in respect of staff restructuring costs which are included within administrative expenses.
2023 |
2022 |
|
Exceptional items |
||
Restructuring costs |
235,740 |
36,173 |
Other exceptional expenses |
196,180 |
- |
Total exceptional items |
431,920 |
36,173 |
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2023 |
2022 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
Redundancy costs |
|
|
|
|
The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:
2023 |
2022 |
|
Administration and support |
|
|
Sales |
|
|
|
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
2023 |
2022 |
|
Remuneration |
|
|
In respect of the highest paid director:
2023 |
2022 |
|
Remuneration |
|
|
Auditors' remuneration |
2023 |
2022 |
|
Audit of the financial statements |
|
|
Other fees to auditors |
||
Taxation compliance services |
|
|
All other non-audit services |
|
|
|
|
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Income tax |
Tax charged/(credited) in the income statement
2023 |
2022 |
|
Current taxation |
||
UK corporation tax |
- |
|
Deferred taxation |
||
Arising from origination and reversal of temporary differences |
- |
|
Tax expense in the income statement |
- |
|
The tax on profit before tax for the year is calculated at a rate of 23.5% (2022 - 19%).
The differences are reconciled below:
2023 |
2022 |
|
Profit before tax |
|
|
Corporation tax at standard rate |
|
|
Increase (decrease) from effect of expenses not deductible in determining taxable profit (tax loss) |
|
|
Tax decrease from utilisation or increase from accumulation of tax losses |
( |
( |
Deferred tax expense (credit) relating to changes in tax rates or laws |
( |
( |
Decrease (increase) from effect of tax incentives |
|
( |
Total tax charge |
- |
|
Corporation tax has been calculated using a hybrid rate of 23.5% (2022: 19%) following the increase to the main rate of corporation tax effective from 1 April 2023.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Deferred tax
Deferred tax assets and liabilities
Deferred tax movement during the year:
At 1 January 2023 |
At |
|
- |
- |
Deferred tax movement during the prior year:
At 1 January 2022 |
Recognised in income |
At |
|
Tax losses carry-forwards |
|
( |
- |
|
( |
- |
There are £
Factors that may affect future tax charges
Deferred tax has been measured using a long-term corporation rate of 25%, as this was the last rate substantively enacted before the year end.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Right of use assets |
Property |
Total |
|
Cost or valuation |
||
At 1 January 2022 |
1,544,820 |
1,544,820 |
Additions |
962,850 |
962,850 |
Disposals |
(1,481,820) |
(1,481,820) |
At 31 December 2022 |
1,025,850 |
1,025,850 |
At 1 January 2023 |
1,025,850 |
1,025,850 |
Disposals |
(1,025,850) |
(1,025,850) |
At 31 December 2023 |
- |
- |
Depreciation |
||
At 1 January 2022 |
1,382,488 |
1,382,488 |
Charge for year |
441,282 |
441,282 |
Eliminated on disposal |
(1,481,820) |
(1,481,820) |
At 31 December 2022 |
341,950 |
341,950 |
At 1 January 2023 |
341,950 |
341,950 |
Charge for the year |
427,438 |
427,438 |
Eliminated on disposal |
(769,388) |
(769,388) |
At 31 December 2023 |
- |
- |
Carrying amount |
||
At 31 December 2023 |
- |
- |
At 31 December 2022 |
683,900 |
683,900 |
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Property, plant and equipment |
Land and buildings |
Furniture, fittings and equipment |
Short leasehold improvements |
Other property, plant and equipment |
Total |
|
Cost or valuation |
|||||
At 1 January 2022 |
|
|
|
|
|
Additions |
- |
|
|
|
|
Disposals |
( |
( |
( |
( |
( |
At 31 December 2022 |
- |
|
|
|
|
At 1 January 2023 |
- |
|
|
|
|
Additions |
- |
|
- |
|
|
Disposals |
- |
- |
- |
( |
( |
At 31 December 2023 |
- |
|
|
|
|
Depreciation |
|||||
At 1 January 2022 |
|
|
|
|
|
Charge for year |
|
|
|
|
|
Eliminated on disposal |
( |
( |
( |
( |
( |
At 31 December 2022 |
- |
|
- |
|
|
At 1 January 2023 |
- |
|
- |
|
|
Charge for the year |
- |
|
|
|
|
Eliminated on disposal |
- |
- |
- |
( |
( |
At 31 December 2023 |
- |
|
|
|
|
Carrying amount |
|||||
At 31 December 2023 |
- |
|
|
|
|
At 31 December 2022 |
- |
|
|
|
|
At 1 January 2022 |
|
|
|
|
|
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Intangible assets |
Trademarks |
Website |
Total |
|
Cost or valuation |
|||
At 1 January 2022 |
|
|
|
At 31 December 2022 |
|
|
|
At 1 January 2023 |
|
|
|
At 31 December 2023 |
|
|
|
Amortisation |
|||
At 1 January 2022 |
|
|
|
Amortisation charge |
|
- |
|
At 31 December 2022 |
|
|
|
At 1 January 2023 |
|
|
|
Amortisation charge |
|
- |
|
At 31 December 2023 |
|
|
|
Carrying amount |
|||
At 31 December 2023 |
|
- |
|
At 31 December 2022 |
|
- |
|
At 1 January 2022 |
|
- |
|
Trade and other receivables |
Current |
31 December |
31 December |
Trade receivables |
|
|
Receivables from related parties |
|
- |
Prepayments |
|
|
Other receivables |
|
- |
|
|
Trade and other receivables are classified as loans and receivables and are therefore measured at amortised cost.
The company's exposure to credit and market risks, including impairments and allowances for credit losses, relating to trade and other receivables is disclosed in note 25 "Financial Instruments and financial risk management".
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Cash and cash equivalents |
31 December |
31 December |
|
Cash on hand |
|
|
Cash at bank |
|
|
|
|
Share capital |
Allotted, called up and fully paid shares
31 December |
31 December |
|||
No. |
£ |
No. |
£ |
|
|
|
1,882 |
|
1,882 |
Rights, preferences and restrictions
Ordinary shares carry no right to fixed income or have any preferences or restrictions attached to them, and carry equal voting rights. |
Reserves |
Capital redemption reserve
The capital redemption reserve arose on 12 April 2007 when the company repurchased 184 ordinary £0.10 shares.
Share premium
The share premium arose on 31 December 2016 when ordinary shares were issued to Artefact SAS in exchange for shares in 4Ps Marketing Limited.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Obligations under leases and hire purchase contracts |
Operating leases
The total future value of minimum lease payments is as follows:
31 December |
|
Within one year |
|
In two to five years |
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £Nil (2022 - £Nil).
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Lease liabilities |
The total future value of lease liabilities is as follows:
31 December |
31 December |
|
Due within one year |
- |
|
In two to five years |
- |
|
- |
|
Pension and other schemes |
Defined contribution pension scheme
The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £151,207 (2022 - £113,801).
Contributions totalling £
Other provisions |
Other provisions |
Total |
|
Additional provisions |
|
|
At 31 December 2023 |
|
|
Non-current liabilities |
|
|
|
Trade and other payables |
31 December |
31 December |
|
Trade payables |
|
|
Accrued expenses |
|
|
Amounts due to related parties |
|
|
Social security and other taxes |
|
|
Outstanding defined contribution pension costs |
|
|
Other payables |
|
|
|
|
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Commitments |
Capital commitments
The total amount contracted for but not provided in the financial statements was £
Financial Instruments and financial risk management |
The Company's principal financial instruments are cash and cash equivalents. The principal purpose of these financial instruments is to provide finance for the Company's operations. The Company's other financial instruments comprise trade and other receivables and payables that arise directly from its operations and short term intra group debt, all of which are carried at amortised cost.
Interest Rate Risk
As the Company has no significant interest-bearing assets, other than cash and cash equivalents, the Company's income and operating cash flows are substantially independent of changes in market interest rates. Income and cash flows from cash and cash equivalents fluctuate with interest rates.
Cash is denominated in sterling and euros and interest is paid on cash and borrowings at a floating rate.
The Company finances its operations through retained earnings and intra group loans and has no interest-bearing borrowings to manage.
Consequently there is no risk associated with a change in interest rates. When and if it is considered appropriate, the Company will monitor its interest rate risk exposure and take necessary action to ensure exposure is minimised.
Credit risk and impairment |
There are no significant concentrations of credit risk within the Company. The maximum credit risk exposure relating to financial assets is represented by their carrying value as at the balance sheet date.
Trade and other receivables, as shown on the balance sheet, comprise a large number of individually small amounts from unrelated customers and are shown net of a provision for doubtful debts.
The Company has established procedures to minimise the risk of default on trade receivables including, when considered appropriate, undertaking detailed credit checks before a customer is accepted.
Market risk |
The Company operates in a global industry and is exposed to foreign exchange risk arising from various currency exposures.
Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Foreign exchange risk |
The primary foreign exchange risk is with respect to Sterling and the Euro. Foreign exchange risk arises when commercial transactions and recognised assets and liabilities are denominated in a currency that is not the entity's functional currency.
The Company monitors both the level of likely future foreign currency cash flows and forecasts of exchange rate movements and manages foreign exchange risk by holding cash balances and borrowings in the Euro.
Sensitivity analysis
The Company has used a sensitivity analysis technique that measures the estimated change to the income statement and equity of a 1% strengthening or weakening in sterling against all other currencies, with all other variables remaining constant. The sensitivity analysis includes only outstanding foreign currency denominated assets and liabilities and adjusts their translation at the balance sheet date for a 1% change in the applicable foreign currency rate.
Under this assumption, with a 1% strengthening or weakening of sterling against all exchange rates, loss before tax would have decreased negligibly.
Liquidity risk |
The Company is financed by retained earnings and loans from group companies.
Cash flow forecasts are produced to assist management in identifying liquidity requirements and are stress tested for possible scenarios. Cash balances are invested in the short-term such that they are readily available to settle short-term liabilities or fund capital additions.
The table below summarises the maturity profile of the Company's financial liabilities at 31 December 2023 and 2022 based on contractual undiscounted payments.
Intra group loans owing to group companies have been classified as repayable within 1 year in the Statement of Financial Position as they could theoretically be recalled at any time. However since the amounts owed to group companies are well exceeded by amounts owed by group companies they are unlikely to be recalled and can be considered as owing after more than 5 years when considering liquidity risk.
Maturity analysis |
2023 |
Within 1 year |
Total |
Trade and other payables |
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Contract liabilities |
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Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
2022 |
Within 1 year |
Total |
Trade and other payables |
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Contract liabilities |
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Artefact UK Ltd
Notes to the Financial Statements
Year Ended 31 December 2023
Capital risk management |
Capital components
The Company assesses the performance of the business, the level of available funds and the short to medium-term plans concerning capital. Such assessment influences the level of dividends payable.
Externally imposed capital requirements
The company is not subject to any externally imposed capital requirements, though their capital position is reviewed annually by their parent company.
Capital management
The company manages its capital to ensure that it will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.
Parent and ultimate parent undertaking |
The most senior parent entity producing publicly available financial statements is
Relationship between entity and parents
The parent of the largest group in which these financial statements are consolidated is
The address of Artefact SAS is:
Paris
75009
France