Company Registration No. 08112390 (England and Wales)
Lakeside Software EMEA Limited
Annual report and
group financial statements
for the year ended 31 December 2023
Lakeside Software EMEA Limited
Company information
Directors
Brian Benson
(Appointed 7 June 2023)
David Keil
Company number
08112390
Registered office
8 Devonshire Square
6th Floor, Suite 06-102
London
EC2M 4YJ
Independent auditor
Saffery LLP
St John's Court
Easton Street
High Wycombe
HP11 1JX
Lakeside Software EMEA Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group statement of financial position
9
Group statement of changes in equity
10
Group statement of cash flows
11
Notes to the group financial statements
12 - 27
Parent company statement of financial position
28
Parent company statement of changes in equity
29
Notes to the parent company financial statements
30 - 33
Lakeside Software EMEA Limited
Strategic report
For the year ended 31 December 2023
1
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
Lakeside Group Holdings LLC and Subsidiaries (the "Parent Group") publishes proactive IT software that gives everyone a better view of their IT environment. The Parent Group’s patented SysTrack Workspace Analytics software (SysTrack) empowers organizations with large, complex IT environments gain visibility across their entire digital estate and do more with less. The Group's customers use SysTrack's real-time data gathering, assessment tools, and complementary analytics to see the hidden issues across their IT estate, see the smartest fixes, and see the biggest savings.
Lakeside Software LLC (the “Parent”) is headquartered in Boston, MA and has sales offices around the world and an engineering facility in Ann Arbor, Michigan. Lakeside Software EMEA Ltd is the EMEA region headquarters in London.
Lakeside Software LLC provides cloud-based Software-As-A-Service (SAAS) to business customers. The Parent's engineering team designs and builds its SysTrack software in Michigan. Lakeside Software EMEA Limited (the “Company”) functions as a master distributor, providing local sales, sales engineering, and technical support for the product in Europe, the Middle East and Africa. The Company resells software licenses to customers, primarily through a network of distributors and resellers, and pays a transfer fee to the Parent for the licenses it distributes.
The Lakeside Software Germany and Indian subsidiaries of the Company (together, the "Group") provide local marketing and sales support services, and, in India, after sales support services.
The Parent Group’s shares are privately held, and majority owned by Insight Partners, and there has been no change in the year.
Principal risks and uncertainties
Lakeside Software EMEA’s key risks include:
Foreign exchange risk due to assets and liabilities being denominated in other currencies, mainly USD. Please see note 17 to the group financial statements for further details. The Company derives most of its revenue in USD and incurs significant overheads in GBP. It therefore has exposure to the USD/GBP exchange rate which it monitors closely.
Credit risk due to exposure to global customers. Please see note 11 and 14 to the group financial statements for further details.
The Company also maintains and monitors cash levels to ensure that it has sufficient funds for operations.
Development and performance
The financial position of the Company and its subsidiaries is set out in the financial statements and the notes that follow.
The Group’s business model is to provide cloud-based Software-As-A-Service (SAAS), and to improve the retention of current customers. This will generate increasing annuity revenue streams, which will provide a degree of insulation from turbulent market conditions that may be encountered from time to time, whilst enabling the focus to be on innovation and building the global customer base.
The Groups key objective for the financial year were:
Since the year end the business outlook for the company has been flat, and the directors are confident that the ongoing outlook will remain broadly consistent. Current investment in the region remains focused into our UK & German operations, and any increases in headcount will be centred around these markets.
Lakeside Software EMEA Limited
Strategic report (continued)
For the year ended 31 December 2023
2
Key performance indicators
These are measured through our key performance indicators which include
Brian Benson
Director
26 September 2024
Lakeside Software EMEA Limited
Directors' report
For the year ended 31 December 2023
3
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the group continued to be that of being the European, Middle Eastern, Indian and African arm of a software company that sells software enabling the analytics of end users computing.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Brian Benson
(Appointed 7 June 2023)
David Keil
Auditor
Saffery LLP have expressed their willingness to continue in office.
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 group and parent company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the United Kingdom.
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, International Accounting Standard 1 requires that directors:
properly select and apply accounting policies;
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 are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and
make an assessment of the company's ability to continue as a going concern.
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.
Matters covered in the Strategic report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of its performance throughout the year and position at the year end, as well as likely future developments and key risks.
Lakeside Software EMEA Limited
Directors' report (continued)
For the year ended 31 December 2023
4
Statement of disclosure to auditor
Each director in office at the date of approval of this annual report confirms that:
so far as the directors are aware, there is no relevant audit information of which the company's auditor is unaware, and
the directors have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.
On behalf of the board
Brian Benson
Director
26 September 2024
Lakeside Software EMEA Limited
Independent auditor's report
To the members of Lakeside Software EMEA Limited
5
Opinion
We have audited the financial statements of Lakeside Software EMEA Limited (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2023 which comprise the group statement of comprehensive income, the group and parent company statement of financial position, the group and parent company statement of changes in equity, the group statement of cash flows and the group and parent company notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and UK adopted international accounting standards.
In our opinion:
the financial statements give a true and fair view of the state of the group's and of the parent company's affairs as at 31 December 2023 and of the group's profit for the year then ended;
the financial statements have been properly prepared in accordance with UK adopted international accounting standards; and
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent 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.
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.
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.
Lakeside Software EMEA Limited
Independent auditor's report (continued)
To the members of Lakeside Software EMEA Limited
6
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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 group and parent company and their 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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 parent 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 parent 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 group and parent company financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.
Identifying and assessing risks related to irregularities
We assessed the susceptibility of the group and parent company’s financial statements to material misstatement and how fraud might occur, including through discussions with the directors, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the group and parent company by discussions with directors and by updating our understanding of the sector in which the group and parent company operate.
Laws and regulations of direct significance in the context of the group and parent company include The Companies Act 2006, and UK Tax legislation.
Lakeside Software EMEA Limited
Independent auditor's report (continued)
To the members of Lakeside Software EMEA Limited
7
Audit response to risks identified
We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of group and parent company financial statement disclosures. We reviewed the parent company’s records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the parent company’s policies and procedures for compliance with laws and regulations with members of management responsible for compliance.
During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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.
Andrew Watkinson (Senior Statutory Auditor)
For and on behalf of Saffery LLP
26 September 2024
Accountants
Statutory Auditor
St John's Court
Easton Street
High Wycombe
HP11 1JX
Lakeside Software EMEA Limited
Group statement of comprehensive income
For the year ended 31 December 2023
8
2023
2022
Notes
£
£
Revenue
3
11,462,522
11,821,374
Cost of sales
(2,251,406)
(5,454,642)
Gross profit
9,211,116
6,366,732
Administrative expenses
(8,111,713)
(10,434,183)
Operating profit/(loss)
4
1,099,403
(4,067,451)
Investment revenues
337
Finance costs
7
(6,953)
(590)
Profit/(loss) before taxation
1,092,787
(4,068,041)
Income tax expense
8
(3,929)
(34,675)
Profit/(loss) for the year
22
1,088,858
(4,102,716)
Other comprehensive income:
Items that will not be reclassified to profit or loss
Currency translation differences
(15,376)
(2,764)
Total items that will not be reclassified to profit or loss
(15,376)
(2,764)
Total other comprehensive income for the year
(15,376)
(2,764)
Total comprehensive income for the year
1,073,482
(4,105,480)
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
Lakeside Software EMEA Limited
Group statement of financial position
As at 31 December 2023
9
2023
2022
Notes
£
£
Non-current assets
Property, plant and equipment
10
309,876
76,599
Current assets
Trade and other receivables
13
6,991,162
9,840,411
Current tax recoverable
3,032
1,462
Cash and cash equivalents
705,247
3,528,077
7,699,441
13,369,950
Current liabilities
Trade and other payables
18
25,147,799
31,902,275
Current tax liabilities
27,686
23,570
Lease liabilities
19
167,654
-
25,343,139
31,925,845
Net current liabilities
(17,643,698)
(18,555,895)
Non-current liabilities
Lease liabilities
19
71,992
-
Net liabilities
(17,405,814)
(18,479,296)
Equity
Called up share capital
21
10,000
10,000
Retained earnings
22
(17,415,814)
(18,489,296)
Total equity
(17,405,814)
(18,479,296)
The financial statements were approved by the board of directors and authorised for issue on 26 September 2024 and are signed on its behalf by:
Brian Benson
Director
Company registration number 08112390 (England and Wales)
Lakeside Software EMEA Limited
Group statement of changes in equity
For the year ended 31 December 2023
10
Share capital
Retained earnings
Total
£
£
£
Balance at 1 January 2022
10,000
(14,383,816)
(14,373,816)
Year ended 31 December 2022:
Loss
-
(4,102,716)
(4,102,716)
Other comprehensive income:
Currency translation differences
-
(2,764)
(2,764)
Total comprehensive income
-
(4,105,480)
(4,105,480)
Balance at 31 December 2022
10,000
(18,489,296)
(18,479,296)
Year ended 31 December 2023:
Loss
-
1,088,858
1,088,858
Other comprehensive income:
Currency translation differences
-
(15,376)
(15,376)
Total comprehensive income
-
1,073,482
1,073,482
Balance at 31 December 2023
10,000
(17,415,814)
(17,405,814)
Lakeside Software EMEA Limited
Group statement of cash flows
For the year ended 31 December 2023
11
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
27
4,434,287
(3,272,024)
Interest received
337
Interest paid
(6,953)
(590)
Income taxes paid
(16,759)
(40,057)
Net cash inflow/(outflow) from operating activities
4,410,912
(3,312,671)
Investing activities
Purchase of property, plant and equipment
(46,807)
(43,822)
Proceeds from disposal of property, plant and equipment
(1,026)
Net cash used in investing activities
(47,833)
(43,822)
Financing activities
Payment of lease liabilities
(94,538)
(28,087)
Movement in funding from parent entity
(7,091,371)
4,353,028
Net cash (used in)/generated from financing activities
(7,185,909)
4,324,941
Net (decrease)/increase in cash and cash equivalents
(2,822,830)
968,448
Cash and cash equivalents at beginning of year
3,528,077
2,559,629
Cash and cash equivalents at end of year
705,247
3,528,077
Lakeside Software EMEA Limited
Notes to the group financial statements
For the year ended 31 December 2023
12
1
Accounting policies
Company information
Lakeside Software EMEA Limited is a private company limited by shares incorporated in England and Wales. The registered office is 8 Devonshire Square, 6th Floor, Suite 06-102, London, EC2M 4YJ. The company's principal activities and nature of its operations are disclosed in the directors' report.
The group consists of Lakeside Software EMEA Limited and all of its subsidiaries.
1.1
Accounting convention
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.
The financial statements are prepared in sterling, which is the functional currency of the group. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Lakeside Software EMEA Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
1.3
Going concern
The directors have considered forecasts and cash flow projections covering the next 12 months. trueLakeside Software LLC, the immediate parent Company, has confirmed it will provide financial support to the Group to enable it to meet its financial obligations as they fall due. The going concern basis of the Group is therefore considered appropriate by the directors.
1.4
Revenue
Revenue is recognised in accordance with the transfer of promised services to customers. Revenue is measured, using an output methodology, as the consideration that the Group is expected to be entitled to in exchange for those goods or services. Consideration is typically fixed on the agreement of a contract. Payment terms are agreed on a contract-by-contract basis. The Group recognises revenue when performance obligations have been satisfied and for the Group this is when the services have transferred to the customer and the customer has control of these. The transaction price is set out in contract documents, with allocation of the price agreed within a contract payment schedule.
The Group has taken advantage of the practical expedients under IFRS 15, both to not discount consideration where expected settlement is within one year and not to recognise the costs of obtaining a contract as an asset where the expected amortisation period is one year or less.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
13
Performance obligations and timing of revenue recognition
Typically revenue is recognised at the point of transfer for software licences, and over the term of any assurance or support where contracted. For software as a service ("SaaS"), revenue is recognised in line with the provision of the service. Where contracts contain multiple performance obligations, standalone selling price is used to split the components for revenue recognition. Payment is typically received for these contracts and licences obtained from group entities up-front, and so significant contract assets and liabilities are recognised.
1.5
Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Right of use asset
Over the life of the lease
Fixtures, fittings & equipment
Straight line over 4 years
Computer equipment
Straight line over 3 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the income statement.
1.6
Non-current investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.7
Impairment of tangible and intangible assets
At each reporting end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.8
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
Financial assets
Financial assets are recognised in the Group's statement of financial position when the Group becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.
The Group only holds financial assets not classified as fair value through profit and loss, they are initially measured at fair value plus transaction costs.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
14
Financial assets held at amortised cost
Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.
Impairment of financial assets
Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.
The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
1.10
Financial liabilities
The group recognises financial debt when the group becomes a party to the contractual provisions of the instruments. The Group only holds 'other financial liabilities'.
Other financial liabilities
Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the group’s obligations are discharged, cancelled, or they expire.
1.11
Equity instruments
Equity instruments issued by the parent company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer payable at the discretion of the company.
1.12
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
15
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.
1.13
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of inventories or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the group is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
At inception, the group assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the group recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.
The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the group's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the group is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
16
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the group's estimate of the amount expected to be payable under a residual value guarantee; or the group's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The group has elected not to recognise right-of-use assets and lease liabilities for short-term leases of property or machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.
1.16
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
Subsidiary entities denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in other comprehensive income.
2
Adoption of new and revised standards and changes in accounting policies
There are no new standards impacting the company that have been adopted in the financial statements for the year ended 31 December 2023.
Standards which are in issue but not yet effective
The directors have not identified any relevant standards that were in issue, but not yet effective, and not applied in these financial statements, that would be expected to have a material impact on the company in the current or future reporting periods.
3
Revenue
2023
2022
£
£
Revenue analysed by class of business
License and assurance revenue
3,124,250
5,950,084
SAAS revenue
7,874,136
4,928,745
Professional services
464,136
604,139
Parent company recharge
-
338,406
11,462,522
11,821,374
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
3
Revenue (continued)
17
2023
2022
£
£
Revenue analysed by geographical market
UK and Ireland
7,543,550
6,803,080
Europe mainland
3,011,090
2,579,869
Middle East
154,562
413,128
Rest of the world
753,320
2,025,297
11,462,522
11,821,374
4
Operating profit
2023
2022
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(874,095)
1,707,780
Depreciation of property, plant and equipment
144,535
96,839
Loss on disposal of property, plant and equipment
4,205
46
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
36,559
34,625
6
Employees
The average monthly number of persons (including directors) employed by the group during the year was:
2023
2022
Number
Number
61
63
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
4,921,433
4,614,986
Social security costs
580,001
461,024
Pension costs
207,372
176,662
5,708,806
5,252,672
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
18
7
Finance costs
2023
2022
£
£
Interest on bank overdrafts and loans
-
558
Interest on lease liabilities
6,953
32
Total interest expense
6,953
590
8
Income tax expense
2023
2022
£
£
Current tax
Foreign taxes and reliefs
7,523
40,242
7,523
40,242
Deferred tax
Origination and reversal of temporary differences
(3,594)
(5,567)
Total tax charge
3,929
34,675
The charge for the year can be reconciled to the profit per the income statement as follows:
2023
2022
£
£
Profit before taxation
1,092,787
(4,068,041)
Expected tax charge/(credit) based on a corporation tax rate of 23.50% (2022: 19.00%)
256,805
(772,928)
Effect of expenses not deductible in determining taxable profit
4,232
1,579
Unutilised tax losses carried forward
(232,108)
794,156
Permanent capital allowances in excess of depreciation
(2,655)
(1,505)
Effect of overseas tax rates
(22,345)
13,373
Taxation charge for the year
3,929
34,675
No deferred tax asset has been recognised in respect of tax losses amounting to £17,547,521 (2022 - £18,535,215) as it is not considered probable that there will be future taxable profits available. Included in unrecognised tax losses are hybrid and other mismatches of £11,934,075 (2022 - £12,921,769) that are only able to be offset against future dual inclusion income. All losses may be carried forward indefinitely.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
19
9
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Principal activities
Class of
shares held
% Held
Direct
Lakeside Software GmbH
Frankfurt am Main,
Geschäftsanschrift: Prielmayerstraße 3, 80335 München, Germany
Software sales support
Ordinary shares
100.00
Lakeside Software India Private Limited
Level 4, Dynasty Business Park, A Wing Andheri-Kurla Road, Andheri East, Mumbai MH 400059, India
Software marketing, sales support, and after sales support
Ordinary shares
99.99
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
20
10
Property, plant and equipment
Right of use asset
Fixtures, fittings & equipment
Computer equipment
Total
£
£
£
£
Cost
At 1 January 2022
275,283
3,327
181,823
460,433
Additions
43,822
43,822
Disposals
(275,283)
(2,322)
(13,431)
(291,036)
At 31 December 2022
1,005
212,214
213,219
Additions
334,184
46,807
380,991
Disposals
(69,164)
(69,164)
At 31 December 2023
334,184
1,005
189,857
525,046
Accumulated depreciation and impairment
At 1 January 2022
221,546
3,231
106,520
331,297
Charge for the year
53,737
50
43,052
96,839
Eliminated on disposal
(275,283)
(2,276)
(13,431)
(290,990)
Foreign currency adjustments
(526)
(526)
At 31 December 2022
1,005
135,615
136,620
Charge for the year
97,470
47,065
144,535
Eliminated on disposal
(65,985)
(65,985)
At 31 December 2023
97,470
1,005
116,695
215,170
Carrying amount
At 31 December 2023
236,714
-
73,162
309,876
At 31 December 2022
-
-
76,599
76,599
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
21
11
Credit risk
Credit risk arises from cash and cash equivalents, and credit exposures to customers, including outstanding receivables.
The carrying amount of financial assets recorded in the financial statements, which is net of impairment losses, represents the group's maximum exposure to credit risk.
The group does not hold any collateral or other credit enhancements to cover this credit risk.
(i) Risk management
Credit risk is managed centrally. Individual risk limits are set based on internal or external ratings in accordance with limits set centrally. There are no significant concentrations of credit risk, whether through exposure to individual customers, specific industry sectors and region.
(ii) Security
The company does not obtain security in the form of guarantees, deeds of undertaking or letters of credit.
The company has two types of financial assets that are subject to the expected credit loss model:
(iv) Trade receivables and contract assets
The company applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets.
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 incurred costs of sale and commissions deferred to recognise in line with revenue under IFRS15. The Company has therefore concluded that the expected loss rates for the contract assets is nil.
12
Contracts with customers
2023
2022
2021
£
£
£
Contracts in progress
Contract receivables included in trade and other receivables
4,117,895
3,028,028
4,065,527
Contract assets
3,266,477
7,234,503
6,421,082
Contract liabilities
(7,505,998)
(7,435,313)
(7,484,720)
Analysis of contract assets
2023
2022
£
£
Assets recognised from the costs to fulfil a contract with a customer
1,697,355
5,708,435
Assets recognised from the cost to obtain a contract with a customer
1,569,122
1,526,068
3,266,477
7,234,503
Revenue from contract liabilities is recognised over the remaining lifetime of the contracts; typically over 1-2 years. Costs included within contract assets typically realise over the same period, save that commissions payable consider the likely renewal period of a given contract.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
12
Contracts with customers (continued)
22
Significant changes in the period
2023
2022
Contract assets
Contract liabilities
Contract assets
Contract liabilities
£
£
£
£
Revenue recognised in the reporting period that was included in the contract liability balance at the beginning of the period
-
5,980,054
-
5,409,386
Amortisation recognised in the reporting period on contract assets
4,374,673
-
5,923,823
-
13
Trade and other receivables
2023
2022
£
£
Trade receivables
4,117,893
3,028,030
Provision for bad and doubtful debts
(698,596)
(670,908)
3,419,297
2,357,122
Contract assets (note 12)
3,266,477
7,234,503
Other receivables
66,709
40,150
Prepayments
238,679
208,636
6,991,162
9,840,411
14
Trade receivables - credit risk
Fair value of trade receivables
The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.
Movement in the allowances for doubtful debts
2023
2022
£
£
Balance at 1 January 2023
670,908
72,538
Additional allowance recognised
27,688
670,908
Amounts written off as uncollectable
-
(72,538)
Balance at 31 December 2023
698,596
670,908
At 31 December, the analysis of trade receivables that are past due but not impaired is as follows:
<30
31-60
60-90
90+
Total
£
£
£
£
£
2023
16,981
258,910
2,521,697
621,709
3,419,297
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
14
Trade receivables - credit risk (continued)
23
2022
2,099,372
221,318
9,965
26,466
2,357,121
Expected credit losses have been provided based on a historic loss rate of 0.46% of the underlying revenue, save where specific indication of risk has been identified.
15
Fair value of financial liabilities
The directors consider that the carrying amounts of financial liabilities carried at amortised cost in the financial statements approximate to their fair values.
16
Liquidity risk
The following table details the remaining contractual maturity for the group's financial liabilities with agreed repayment periods. The contractual maturity is based on the earliest date on which the group may be required to pay.
Less than 1 month
1 - 3 months
3 - 12 months
Total
£
£
£
£
At 31 December 2022
Trade payables
13,033
2,696
16,930
32,659
13,033
2,696
16,930
32,659
At 31 December 2023
Trade payables
26,933
39,660
7,458
74,051
26,933
39,660
7,458
74,051
Liquidity risk management
Prudent liquidity risk management implies maintaining sufficient cash to meet obligations when due. At the end of the reporting period the group held deposits at call of £705,247 (2022: £3,528,077). Management monitors rolling forecasts of the group’s cash and cash equivalents on the basis of expected cash flows.
Amounts owed by fellow group undertakings of £16,492,042 (2022: £24,583,413) are repayable on demand.
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
24
17
Market risk
Market risk management
Foreign exchange risk
The carrying amounts of the group's foreign currency denominated monetary assets and liabilities at the reporting date are as follows:
Assets
Liabilites
2023
2022
2023
2022
£
£
£
£
Trade receivable
3,415,750
3,171,760
-
-
Cash and cash equivalents
565,361
3,187,231
-
-
Amount owed by fellow group undertakings
-
-
16,492,042
23,583,413
Trade payables
-
-
63,395
26,055
3,981,111
6,358,991
16,555,437
23,609,468
Whilst the group takes steps to minimise its exposure to foreign exchange risk, changes in foreign exchange rates will have an impact on profit.
The group's foreign exchange risk is dependent on the movement in the US dollar to sterling exchange rate. The effect of a 10% strengthening in the dollar against sterling at the reporting date on the dollar denominated debt at the date end on the annualised interest on that amount would, all other variables being held constant, have resulted in a decrease in the post-tax profit for the year of £1,257,433 (2022: £1,725,047).
A 10% weakening in the exchange rate would, on the same basis, have increased post-tax profit by £1,143,121 (2022: £1,568,225).
18
Trade and other payables
2023
2022
£
£
Trade payables
74,053
32,659
Contract liabilities (note 12)
7,505,998
7,435,313
Amount owed to parent undertaking
16,492,042
23,583,413
Accruals
345,112
384,373
Social security and other taxation
676,818
431,861
Other payables
53,776
34,656
25,147,799
31,902,275
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
25
19
Lease liabilities
2023
2022
Maturity analysis
£
£
Within one year
173,986
-
In two to five years
72,494
-
Total undiscounted liabilities
246,480
-
Future finance charges and other adjustments
(6,834)
-
Lease liabilities in the financial statements
239,646
-
Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:
2023
2022
£
£
Current liabilities
167,654
-
Non-current liabilities
71,992
-
239,646
-
2023
2022
Amounts recognised in profit or loss include the following:
£
£
Interest on lease liabilities
6,953
32
The Company's leases relate to premises. The implicit rate for the year was 4.33%. Interest rates are fixed at the contract date. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
207,372
176,662
The group operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
10,000
10,000
10,000
10,000
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
21
Share capital (continued)
26
The company has one class of ordinary shares which carry full voting, dividend and capital distribution (including on winding up) rights. They do not confer any rights of redemption.
22
Retained earnings
Included within retained earnings of the Group is a foreign currency translation deficit of £21,129 (2022 - £5,753).
The net currency exchange difference arising on retranslation in the year was a loss of £15,376 (2022 - £2,764). The foreign currency translation reserves contain accumulated foreign currency translation differences from the translation of the subsidiary accounts into the Group's presentational currency.
23
Other leasing information
Lessee
Amounts recognised in profit or loss as an expense during the period in respect of lease arrangements are as follows:
2023
2022
£
£
Expense relating to short-term leases
54,494
75,459
Information relating to lease liabilities is included in note 19.
24
Capital risk management
The group is not subject to any externally imposed capital requirements.
25
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel, including directors, is set out below in aggregate for each of the categories specified in IAS 24 Related Party Disclosures.
Other transactions with related parties
During the year the group entered into the following transactions with related parties:
Recharged income
Purchases
2023
2022
2023
2022
£
£
£
£
Parent company
338,406
2,251,406
6,414,469
Lakeside Software EMEA Limited
Notes to the group financial statements (continued)
For the year ended 31 December 2023
27
26
Controlling party
The immediate parent company of Lakeside Software EMEA Limited is Lakeside Software LLC, a company incorporated in the USA.
The ultimate parent company of Lakeside Software EMEA Limited is Lakeside Group Holdings LLC, a company incorporated in the USA. The directors are of the opinion that there is no ultimate controlling party.
27
Cash generated from/(absorbed by) operations
2023
2022
£
£
Profit/(loss) for the year before income tax
1,092,787
(4,068,041)
Adjustments for:
Finance costs
6,953
590
Investment income
(337)
Movement in funding from parent entity
7,091,371
(4,353,028)
Loss on disposal of property, plant and equipment
4,205
46
Depreciation and impairment of property, plant and equipment
144,535
96,839
Movements in working capital:
Decrease/(increase) in contract assets
3,968,026
(813,421)
(Increase)/decrease in trade and other receivables
(1,118,777)
1,732,663
Increase/(decrease) in contract liabilities
70,685
(49,407)
(Decrease)/increase in trade and other payables
(6,825,161)
4,181,735
Cash generated from/(absorbed by) operations
4,434,287
(3,272,024)
Lakeside Software EMEA Limited
Company statement of financial position
As at 31 December 2023
28
2023
2022
Notes
£
£
Non-current assets
Property, plant and equipment
30
294,500
47,767
Investments
31
27,629
27,629
322,129
75,396
Current assets
Trade and other receivables
33
6,902,997
9,784,233
Cash and cash equivalents
632,745
3,457,135
7,535,742
13,241,368
Current liabilities
Trade and other payables
35
25,336,139
32,015,567
Lease liabilities
36
167,654
-
25,503,793
32,015,567
Net current liabilities
(17,968,051)
(18,774,199)
Non-current liabilities
Lease liabilities
36
71,992
-
Net liabilities
(17,717,914)
(18,698,803)
Equity
Called up share capital
37
10,000
10,000
Retained earnings
(17,727,914)
(18,708,803)
Total equity
(17,717,914)
(18,698,803)
As permitted by s408 Companies Act 2006, the company has not presented its own income statement and related notes. The company’s profit for the year was £980,889 (2022 - £4,182,944 loss).
The financial statements were approved by the board of directors and authorised for issue on 26 September 2024 and are signed on its behalf by:
Brian Benson
Director
Company registration number 08112390 (England and Wales)
Lakeside Software EMEA Limited
Company statement of changes in equity
For the year ended 31 December 2023
29
Share capital
Retained earnings
Total
£
£
£
Balance at 1 January 2022
10,000
(14,525,859)
(14,515,859)
Year ended 31 December 2022:
Loss and total comprehensive income
-
(4,182,944)
(4,182,944)
Balance at 31 December 2022
10,000
(18,708,803)
(18,698,803)
Year ended 31 December 2023:
Profit and total comprehensive income
-
980,889
980,889
Balance at 31 December 2023
10,000
(17,727,914)
(17,717,914)
Lakeside Software EMEA Limited
Notes to the company financial statements
For the year ended 31 December 2023
30
28
Accounting policies
Company information
The following notes refer to the separate financial statements of Lakeside Software EMEA Limited ("the company").
Lakeside Software EMEA Limited is a private company limited by shares incorporated in England and Wales. The registered office is 8 Devonshire Square, 6th Floor, Suite 06-102, London, EC2M 4YJ.
28.1
Accounting convention
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The company applies accounting policies consistent with those applied by the group. To the extent that an accounting policy is relevant to both group and parent company financial statements, please refer to the group financial statements for disclosure of the relevant accounting policy.
28.2
Going concern
The directors have considered forecasts and cash flow projections covering the next 12 months. Lakeside Software LLC, the immediate parent company, has confirmed it will provide financial support to the company to enable it to meet its financial obligations as they fall due. The going concern basis of the company is therefore considered appropriate by the director.
29
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
35
35
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
4,056,884
3,604,892
Social security costs
568,448
446,491
Pension costs
174,312
140,677
4,799,644
4,192,060
Lakeside Software EMEA Limited
Notes to the company financial statements (continued)
For the year ended 31 December 2023
31
30
Property, plant and equipment
Land and buildings Freehold
Fixtures, fittings & equipment
Computer equipment
Total
£
£
£
£
Cost
At 1 January 2022
275,283
3,327
140,217
418,827
Additions
25,862
25,862
Disposals
(275,283)
(2,322)
(13,431)
(291,036)
At 31 December 2022
1,005
152,648
153,653
Additions
334,184
46,807
380,991
Disposals
(60,111)
(60,111)
At 31 December 2023
334,184
1,005
139,344
474,533
Accumulated depreciation and impairment
At 1 January 2022
221,546
3,231
92,710
317,487
Charge for the year
53,737
50
25,602
79,389
Eliminated on disposal
(275,283)
(2,276)
(13,431)
(290,990)
At 31 December 2022
1,005
104,881
105,886
Charge for the year
97,470
32,012
129,482
Eliminated on disposal
(55,335)
(55,335)
At 31 December 2023
97,470
1,005
81,558
180,033
Carrying amount
At 31 December 2023
236,714
-
57,786
294,500
At 31 December 2022
-
-
47,767
47,767
At 31 December 2021
53,737
96
47,507
101,340
31
Investments
Current
Non-current
2023
2022
2023
2022
£
£
£
£
Investments in subsidiaries
27,629
27,629
Investment in subsidiary undertakings
Details of the company's principal operating subsidiaries are included in note 11.
Lakeside Software EMEA Limited
Notes to the company financial statements (continued)
For the year ended 31 December 2023
32
32
Contracts with customers
2023
2022
2021
£
£
£
Contracts in progress
Contract receivables included in trade and other receivables
4,117,895
3,028,028
4,065,527
Contract assets
3,266,477
7,234,503
6,421,082
Contract liabilities
(7,505,998)
(7,435,313)
(7,484,720)
Analysis of contract assets
2023
2022
£
£
Assets recognised from the costs to fulfil a contract with a customer
1,697,355
5,708,435
Assets recognised from the cost to obtain a contract with a customer
1,569,122
1,526,068
3,266,477
7,234,503
Significant changes in the period
2023
2022
Contract assets
Contract liabilities
Contract assets
Contract liabilities
£
£
£
£
Revenue recognised in the reporting period that was included in the contract liability balance at the beginning of the period
-
5,980,054
-
5,409,386
Amortisation recognised in the reporting period on contract assets
-
-
5,923,823
-
33
Trade and other receivables
2023
2022
£
£
Trade receivables
4,117,895
3,028,029
Provision for bad and doubtful debts
(698,596)
(670,908)
3,419,299
2,357,121
Contract assets (note 32)
3,266,477
7,234,503
Other receivables
46,531
20,525
Prepayments
170,690
172,084
6,902,997
9,784,233
34
Fair value of financial liabilities
The directors consider that the carrying amounts of financial liabilities carried at amortised cost in the financial statements approximate to their fair values.
Lakeside Software EMEA Limited
Notes to the company financial statements (continued)
For the year ended 31 December 2023
33
35
Trade and other payables
2023
2022
£
£
Trade payables
73,984
29,683
Contract liabilities (note 32)
7,505,998
7,435,313
Amount owed to parent undertaking
16,748,119
23,583,413
Amounts owed to subsidiary undertakings
21,699
218,755
Accruals
296,097
316,943
Social security and other taxation
657,440
412,236
Other payables
32,802
19,224
25,336,139
32,015,567
36
Lease liabilities
2023
2022
Maturity analysis
£
£
Within one year
173,986
-
In two to five years
72,494
-
Total undiscounted liabilities
246,480
-
Future finance charges and other adjustments
(6,834)
-
Lease liabilities in the financial statements
239,646
-
Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:
2023
2022
£
£
Current liabilities
167,654
-
Non-current liabilities
71,992
-
239,646
-
The Company's leases relate to premises. The average effective borrowing rate for the year was 0.46%. Interest rates are fixed at the contract date. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The fair value of the company's lease obligations is approximately equal to their carrying amount.
37
Share capital
Refer to note 21 of the group financial statements.
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