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Registered number: 10276524










LL PAY UK LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
LL PAY UK LIMITED
 
 
COMPANY INFORMATION


Directors
Q Huang (appointed 4 May 2023)
D R Messenger (resigned 4 May 2023)
X S Zhu 




Registered number
10276524



Registered office
Browne Jacobson LLP (CS)
15th Floor

6 Bevis Marks

London

EC3A 7BA




Independent auditors
Greenback Alan LLP
Chartered Accountants

89 Spa Road

London

SE16 3SG





 
LL PAY UK LIMITED
 

CONTENTS



Page
Strategic Report
1 - 2
Directors' Report
3 - 5
Independent Auditors' Report
6 - 10
Statement of Comprehensive Income
11
Statement of Financial Position
12
Statement of Changes in Equity
13 - 14
Statement of Cash Flows
15 - 16
Notes to the Financial Statements
17 - 28

 
LL PAY UK LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors represent the Strategic Report of LL Pay UK Limited ("the Company") for the year ended 31 December 2023.

Business overview
 
LL Pay UK Limited was established in 2016 and obtained authorisation from the Financial Conduct Authority (FCA) to provide money remittance services on 30 April 2018. LL Pay UK Limited has a year end of 31 December 2023. The Company is part of Lianlian Group which is one of the largest non-banking third party payment services providers in China. The Company is principally engaged in provision of payment processing services to assist the Chinese merchant clients of Lianlian International Company Limited to receive payment for goods purchased by their customers and also make payments to the tax authorities on their behalf. Chinese merchants sell their products via online platforms, to customers including those in the UK and Europe.
In order to fund operations of this Company, the Company issued 50,000 shares of £1 each in 2017 and 300,000 additional shares of £1 each in 2019 to Lianlian Hong Kong Company Limited. LL Pay UK limited was sold to Lianlian Pay Global Limited for USD 394,849 on 05 August 2022 as part of the cross border business restructuring by Lianlian Group.

Overview of LLUK’s achievement in 2023

In 2023 the Lianlian Group made an adjustment of its global business strategy by re-focusing on China-originated businesses and consolidating payment businesses generated by local teams in the group’s international subsidiaries. As a part of the adjustment, we made changes on the LLUK’s management and team. The new management that was appointed to LLUK to lead the transition of the operations had more extensive experience working with the China headquarters.  Even with the business adjustment and management change in June, LLUK continued to play a key role in the group company’s global network. Its main focus was pivoted back to helping the China- and Hong Kong-based merchants to collect their sales proceeds from e-commerce platform partners. To a lesser extent, we also developed local businesses by assisting merchants’ VAT payment to tax authorities. In a nutshell, in 2023 we were able to achieve:

Business Recalibration: LLUK was able to restructure its businesses and strengthen its partner relationships with 14 e-commerce platform partners. We outlined the strategic vision for 2024 and tiered platforms for management efficiency and growth. The tie with the headquarter was also reconstructed when we build streamlined processes to take in requests from China for emerging business opportunities. On the other hand, we also enhanced the UK Virtual Account (VA) user experience and wallet product features by working closely with the product team in the headquarters.
Mild financial growth: Both e-commerce collection revenue and UK VA had a positive growth YoY. Both the e-wallet income and bank expenses grew by 34% over 2022, contributing to the increase of the gross profit by 33%. In the meantime, the global expenses increased by 42% as a result of the strategy adjustments, accounted for mainly using contractors and the change of the registered office address.
Enhanced compliance framework: Further enhancements on LLUK's Anti-Financial Crime Programme, including but not limited to new risk management framework, refreshment of policies and procedures and implementation of systematic controls, after the new appointment of MLRO. 
Pan-Europe Synergy: Adjusted UK office structure based on company global strategy and EU expansion. After the establishment of Lianlian’s Luxembourg office, we adopted a coordinated product, partnership and go-to-market approach with the UK market and the EU market to improve the overall efficiency of LLUK and Lianlian Luxembourg company. 

Page 1

 
LL PAY UK LIMITED
 

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

Principal risks and uncertainties
 
The principal risk of the Company arises from the single business structure and the single customer group.

Credit risk

The main credit risk of the Company is its exposure to exchange rate movements. In the group company, the management set the specialised foreign exchange team to adopt market monitoring and forecasting strategies to manage foreign exchange risk. Since we have different kinds of currency for different entities, we manage these FX risks at the group level.

Financial key performance indicators
 
The main financial key performance indicator is to stay cautious in operating expenses and cost and try to expand the business as well.
Administrative expenses increased by 30% to £994,343 due to the increase in labour costs. Since the business expansion requires more human resources, labour costs were increased significantly in 2023 compared with 2022.
Staff retention is a KPI at the group level, however due to the limited amount of employees in the business and the companies current retention rates, no concerns have been identified.


This report was approved by the board on 23 September 2024 and signed on its behalf.



Q Huang
Director
Page 2

 
LL PAY UK 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.

Principal activity

The Company is principally engaged in provision of payment processing services to assist the Chinese merchant clients of Lianlian International Company Limited to receive payment for goods purchased by their customers and also make payments to the tax authorities on their behalf.

Results and dividends

The profit for the year, after taxation, amounted to £42,770 (2022:£55,578).

The net assets for the year ended 31 December 2023 were £521,250 (2022: £478,480)
The directors do not recommend the payment of a dividend for the year ended 31 December 2023 (2022: £Nil)

Directors

The directors who served during the year were:

Q Huang (appointed 4 May 2023)
D R Messenger (resigned 4 May 2023)
X S Zhu 

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 judgments and accounting estimates that are reasonable and prudent;

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

The 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.

Page 3

 
LL PAY UK LIMITED
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Going concern

The company is viewed as continuing in business for the foreseeable future with neither the intention nor necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations. The directors have considered the current cash position of the Company and its cash flow forecasts and remain confident that the Company will be able to meet its on-going obligations as they arise for the next 12 months from the date of approval of the financial statements. As a result, the directors continue to prepare the financial statements on a going concern basis.


2024 and future business plans for LLUK

LLUK’s main task for 2024 is to build on the strength of its 2023 performance by expanding the depth and scale of our businesses and entering into more partnerships, offering better services to our merchants and partners. Specifically, we intend to allocate our resources and efforts in the following areas: 

Enhance the partnership with existing e-commerce platforms while continuing to expand our reach to new e-marketplace players. Currently, LLUK is only assisting the sales proceeds collection on behalf of Chinese and Hong Kong merchants.  As more local merchants set up their UK presence (even though their operations remain situated in China/HK), we need to serve these merchants when and where they launch their UK operations. We strive to enhance collaboration with tier 1 e-commerce platforms to provide better client experiences. At the same time, our business development teams have been exploring ways to tap the local markets for new partnerships.
Collaborate with local PSPs to help them pay out to China. We leverage our unique strength in HK/China to help UK PSPs convert their payment into local currency and pay out to China, where the currency and payment are highly regulated. We believe that the demand for such service and the transaction value are potentially high.  It is the plain vanilla type of services that do not call for a lot of customisation and should suit the lean business service model we intend to build for LLUK.
Expand our banking channels. By collaborating with the global banking partners team at the head office of the group, we will build more diversified banking channels that will match the risk profile and product capabilities of our customers.  


Challenges

We may experience challenges in executing our plan for 2024 and the future, such as: 

Limited resources to explore local opportunities. Currently LLUK has only a lean team mainly to support the China originated business. In order to capture local UK opportunities, experienced and qualified sales staff may need to be added. 
Collaboration with the head office team. Due to the time difference between UK and China, extra attention and effort need to be spent on improving communication efficiencies. Collaboration with the headquarter team is crucial as the UK office relies on support from the headquarters in product, IT, and marketing capabilities. It is also important that the UK personnel to receive training at the headquarters for local market development, which may become a strain on the budget and manpower. 
Ever-changing regulatory requirements. As we are in a regulated business, it is of utmost importance to keep track of the ever-changing regulatory requirements and make sure that our policies and procedures stay up to date to not only meet the regulatory requirements, but also to deliver to our customers the best user experiences as we can.  

Page 4

 
LL PAY UK 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 auditor 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 auditor are aware of that information.

Auditors

Under section 487(2) of the Companies Act 2006Greenback Alan LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

Small companies note

In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

This report was approved by the board on 23 September 2024 and signed on its behalf.
 





Q Huang
Director
Page 5

 
LL PAY UK LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LL PAY UK LIMITED
 

Opinion


We have audited the financial statements of LL PAY UK LIMITED (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, 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 profit 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. Our 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.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


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


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


Page 6

 
LL PAY UK LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LL PAY UK LIMITED (CONTINUED)

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


We have nothing to report in this regard.


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; or
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption in preparing the Directors' Report.


Page 7

 
LL PAY UK LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LL PAY UK LIMITED (CONTINUED)

Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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

 
LL PAY UK LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LL PAY UK 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 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 as follows.
We obtained a general understanding of the 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 is complying with the framework through having in place robust procedures and policies that are developed with and monitored by the parent company and by outsourcing and taking external professional legal, tax and accounting advice on relevant specialist functions and areas including the preparation of financial statements and corporate tax compliance.

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 where 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: Payment Services Regulations 2017, Electronic Money Regulations, Companies Act 2006,  FRS 102 and UK corporate tax laws.
The procedures we carried out to gain sufficient appropriate audit evidence in the above areas included:
 
Assessing the susceptibility of the company’s financial statements to material misstatements, including  how fraud might occur by considering the controls that the company has established to address the risks identified by the company and to prevent and detect fraud and identifying the risk of material fraud related to management override of controls.
Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud and error.
Understanding the potential for override of these controls on the financial reporting process, and how those charged with governance address these override potentials.
Performing tests of controls and substantive testing on appropriate samples, and investigating any discrepancies identified.
Documenting the assumptions and judgments made by management in their significant accounting estimates and challenging these with management.
Identifying and testing journal entries, particularly those around year-end, and involving unusual postings, account combinations, or amounts.


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

 
LL PAY UK LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LL PAY UK 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.





Ian Rowe (Senior Statutory Auditor)
  
for and on behalf of
Greenback Alan LLP
 
Chartered Accountants
  
89 Spa Road
London
SE16 3SG

23 September 2024
Page 10

 
LL PAY UK LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
3,722,363
2,827,186

Cost of sales
  
(2,702,826)
(1,983,336)

Gross profit
  
1,019,537
843,850

Administrative expenses
  
(994,344)
(766,179)

Operating profit
 5 
25,193
77,671

Interest receivable and similar income
 8 
55,318
(1,158)

Interest payable and similar expenses
 9 
(28,879)
(7,352)

Profit before tax
  
51,632
69,161

Tax on profit
 10 
(8,862)
(13,583)

Profit for the financial year
  
42,770
55,578

Other comprehensive income for the year
  

Total comprehensive income for the year
  
42,770
55,578

The notes on pages 17 to 28 form part of these financial statements.
Page 11

 
LL PAY UK LIMITED
REGISTERED NUMBER:10276524

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 11 
1,572
2,137

  
1,572
2,137

Current assets
  

Debtors: amounts falling due within one year
 12 
886,144
482,037

Cash at bank and in hand
 13 
4,524,808
8,276,923

  
5,410,952
8,758,960

Creditors: amounts falling due within one year
 14 
(4,891,274)
(8,282,617)

Net current assets
  
 
 
519,678
 
 
476,343

Total assets less current liabilities
  
521,250
478,480

  

Net assets
  
521,250
478,480


Capital and reserves
  

Called up share capital 
 16 
350,000
350,000

Profit and loss account
 17 
171,250
128,480

  
521,250
478,480


The Company's financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 23 September 2024.




Q Huang
Director

The notes on pages 17 to 28 form part of these financial statements.
Page 12

 
LL PAY UK LIMITED
 

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


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2023
350,000
128,480
478,480


Comprehensive income for the year

Profit for the year

-
42,770
42,770


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
42,770
42,770


Total transactions with owners
-
-
-


At 31 December 2023
350,000
171,250
521,250


The notes on pages 17 to 28 form part of these financial statements.
Page 13

 
LL PAY UK LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2022
350,000
72,902
422,902


Comprehensive income for the year

Profit for the year

-
55,578
55,578


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
55,578
55,578


Total transactions with owners
-
-
-


At 31 December 2022
350,000
128,480
478,480


The notes on pages 17 to 28 form part of these financial statements.
Page 14

 
LL PAY UK LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

Cash flows from operating activities
  

Profit for the financial year
  
42,770
55,578

Adjustments for:
  

Depreciation of tangible assets
 11 
565
681

Interest paid
  
-
1,158

Interest received
  
(55,318)
-

Taxation charge
 10 
8,862
13,583

(Increase) in debtors
 12 
(14,027)
(100,214)

(Increase) in amounts owed by groups
 12 
(338,988)
(102,183)

Increase in creditors
 14 
2,711
102,881

(Decrease)/increase in amounts owed to groups
 14 
(3,440,348)
7,533,766

Corporation tax (paid)/received
  
(13,660)
3,937

Foreign exchange
  
28,879
7,352

Net cash generated from operating activities

  

(3,778,554)
7,516,539

  

Cash flows from investing activities
  

Purchase of tangible fixed assets
  
-
(1,134)

Interest received
 8 
55,318
-

Net cash from investing activities

  

55,318
(1,134)

Cash flows from financing activities
  

Interest paid
 8 
-
(1,158)

Net cash used in financing activities
  
-
(1,158)

Net (decrease)/increase in cash and cash equivalents
  
(3,723,236)
7,514,247

Cash and cash equivalents at beginning of year
 13 
8,276,923
770,028

Foreign exchange gains and (losses)
 9 
(28,879)
(7,352)

Cash and cash equivalents at the end of year
 13 
4,524,808
8,276,923


Cash and cash equivalents at the end of year comprise:
  

Cash at bank and in hand
  
4,689,327
8,528,235

Bank overdrafts
  
(164,519)
(251,312)

  
4,524,808
8,276,923


Page 15

 
LL PAY UK LIMITED
 
The notes on pages 17 to 28 form part of these financial statements.

Page 16

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

LL Pay UK Limited (the "Company") is a private Company limited by shares and incorporated in the England and Wales. The address of its registered office is Browne Jacobson LLP, 15th Floor, 6 Bevis Marks, London EC3A 7BA.
The Company is principally engaged in provision of payment processing services to assist the Chinese merchant clients of Lianlian International Company Limited to receive payment for goods purchased by their customers and also make payments to the tax authorities on their behalf.

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.

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

The following principal accounting policies have been applied:

 
2.2

Going concern

The Company is viewed as continuing in business for foreseeable future with neither the intention nor necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations. The directors have considered the current cash position of the Company and its cash flow forecasts and remain confident that the Company will be able to meet its ongoing obligations as they arise for the foreseeable future, As a result, the directors continue to prepare the financial statements on a going concern basis.

Page 17

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

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.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

 
2.4

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. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.5

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.

Page 18

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.6

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.

 
2.7

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. 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 reporting 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 reporting 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.

 
2.8

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:

Computer equipment
-
5 years straight-line

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.

Page 19

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

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.

 
2.10

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. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.11

Creditors

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

 
2.12

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 ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. 
Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measure initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measure, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measure at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
Financial assets and liabilities are offset and the net amount reported in the Statement of the Financial Position when there is an enforceable right to set off the recognised amounts and there is
Page 20

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.12
Financial instruments (continued)

an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Estimates and judgments are continually evaluated and are based on historical expenses and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The directors do not consider these are any material areas of key judgemental and estimates.


4.


Turnover

The whole of the turnover is attributable to Cross Border Collections Income and E-Wallet FX Service Income. Cross Border Collections Income represents the service fees received for providing money collection and distribution services from Lianlian International Company Limited, which is based in Hong Kong, China.


2023
2022
£
£

E-Wallet FX Service Income
1,361
2

Cross Border Collections Income
3,721,002
2,827,184

3,722,363
2,827,186



5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Other operating lease rentals
142,416
42,979

Page 21

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
39,960
35,550

Fees payable to the Company's auditors in respect of:

Taxation compliance services
6,780
7,660

All non-audit services not included above
3,660
3,300


7.


Employees

2023
2022
£
£

Wages and salaries
411,927
273,326

Social security costs
33,095
33,304

Cost of defined contribution scheme
10,246
10,651

455,268
317,281


The company had 5 employees on average during the year 2023 (2022: 7). UK based directors received emoluments amounting to £100,842 (2022: £Nil). Directors not based in the UK did not receive any remunerations as they were paid by Lianlian Group.


8.


Interest receivable

2023
2022
£
£


Bank interest receivable / (payable)
55,318
(1,158)

55,318
(1,158)


9.


Interest payable and similar expenses

2023
2022
£
£


Exchange (gains) / losses
28,879
7,352

28,879
7,352

Page 22

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
8,930
13,727


8,930
13,727


Total current tax
8,930
13,727

Deferred tax


Origination and reversal of timing differences
(68)
(144)

Total deferred tax
(68)
(144)


Tax on profit
8,862
13,583

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
£
£


Profit on ordinary activities before tax
51,632
69,161


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
12,144
13,141

Effects of:


Fixed assets differences
-
(65)

Expenses not deductible for tax purposes
660
222

Adjustments to tax charge in respect of prior periods
(3,938)
-

Remeasurement of deferred tax for changes in tax rates
(4)
(136)

Movement in deferred tax not recognised
-
421

Total tax charge for the year
8,862
13,583


Factors that may affect future tax charges

Page 23

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
10.Taxation (continued)

The Finance Bill 2021 was substantively enacted on 10 June 2021, as a result the main rate of corporation tax rose from 19% to 25% from 1 April 2023. The standard rate of 23.52% is based on the old tax rate of 19% and new 25% on time-apportioned profit for the year ended 31 December 2023.


11.


Tangible fixed assets





Computer equipment

£



Cost or valuation


At 1 January 2023
2,932



At 31 December 2023

2,932



Depreciation


At 1 January 2023
795


Charge for the year on owned assets
565



At 31 December 2023

1,360



Net book value



At 31 December 2023
1,572



At 31 December 2022
2,137


12.


Debtors

2023
2022
£
£


Amount due from related parties
711,472
372,484

Other debtors
42,557
18,837

Prepayments and accrued income
14,015
23,776

VAT recoverable
117,888
66,796

Deferred taxation
212
144

886,144
482,037



Page 24

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
4,524,808
8,276,923

4,524,808
8,276,923



14.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
56,630
91,423

Amounts owed to group undertakings
4,463,988
7,904,336

Corporation tax
9,118
13,915

VAT and other tax payables
113,924
67,161

Accruals and deferred income
247,614
205,782

4,891,274
8,282,617


Amount owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
There has been a significant increase in the volume of transactions for payment processing to other Group entities. This has resulted in the amount owed by and owed to group undertakings.


15.


Deferred taxation




2023
2022


£

£






At beginning of year
144
-


Charged to the profit or loss
68
144



At end of year
212
144

Page 25

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
15.Deferred taxation (continued)

The deferred tax balance is made up as follows:

2023
2022
£
£


Fixed asset timing differences
(393)
(534)

Short-term timing differences
605
678

212
144

Comprising:

Asset - due within one year
212
144

212
144



16.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



350,000 (2022 - 350,000) Ordinary shares of £1.00 each
350,000
350,000

50,000 shares of £1 each in 2017 and 300,000 additional shares of £1 each in 2019 were issued to Lianlian Hong Kong Company Limited to raise fund future operating expenses. The shares were sold to Lianlian Global Limited for USD394,849 on 05 August 2020 as part of the cross border business restructuring by Lianlian Group.



17.


Reserves

Profit and loss account

The profit and loss account represents the accumulated profits, losses, and distributions of the Company.

Page 26

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


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
28,817
42,979

28,817
42,979


19.


Related party transactions

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities.
During the years ended 31 December, 2023 and 2022, related parties that the Company had the following related party transactions:

Service income charged to Lianlian International Company Limited* of £3,721,002 in 2023  and £2,827,186 in 2022 respectively
*Lianlian International Company Limited is LL Pay UK's sister company under common control by Lianlian Pay Global Limited (Cayman), the immediate holding company.
Balances with related parties are as follows as of 31 December 2023 and 2022

2023
2022
£
£

Due from Lianlian International Company Limited
260,520
372,484
Due from Lianlian Ireland Limited**
93,967
-
Due from LL Pay US LLC***
356,985
-
Due to Lianlian International Company Limited
(4,463,988)
(7,904,336)
(3,752,516)
(7,531,852)

**The company had £93,967 due from Lianlian Ireland Limited as the company bore a contractor cost on their behalf. Lianlian Ireland Limited is an affiliate company under common control by Lianlian Pay Global Limited (Cayman).  

***The Company had £356,985 due from LL Pay US LLC, which was transferred erroneously in December 2023. The error was quickly identified and the amount was fully recovered in January 2024. LL Pay US LLC is an affiliate company under common control by Lianlian Pay Global Limited (Cayman). 

Page 27

 
LL PAY UK LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

20.


Ultimate parent undertaking and controlling party

The immediate parent undertaking, Lianlian Pay Global Limited (Cayman) is the smallest group to consolidate these financial statements and the largest group to consolidate these financial statements is the Lianlian DigiTech Co., Ltd which is the ultimate parent company.

Name                                Place of registration         Registered share capital       Principal activities
Lianlian Pay Global Ltd           Cayman Islands             USD 50,000                          Investment holding
(Controlling party)  
Lianlian DigiTech Co., Ltd        Hangzhou, China             RMB 1,014,760,000             Investment holding
(Ultimate parent)


21.


Post balance sheet events

There are no post balance sheet events to disclose.

Page 28