Company Registration No. SC384375 (Scotland)
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
COMPANY INFORMATION
Directors
Gustavo Pesquin
(Appointed 11 March 2023)
Cristina Gude
(Appointed 8 May 2024)
Secretary
Rosheen Caw
Company number
SC384375
Registered office
Roslin Innovation Centre
Easter Bush Campus
Midlothian
EH25 9RG
Auditor
Johnston Carmichael LLP
7-11 Melville Street
Edinburgh
EH3 7PE
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Fair review of the business
AskBio UK Ltd is a company part of the AskBio group which became a wholly owned, independently operated subsidiary of Bayer AG in late 2020 as a cornerstone of its newly formed Gene Therapy Platform. The principal activity of the company is the development of new life science technologies with application in gene therapies. In particular, the company provides research services and supports AskBio’s R&D programs including in the field of central nervous system, neuromuscular, metabolic and cardiovascular disorders.
As at 31 December 2023 the company had net assets of £8,257,307 (2022: £6,463,915). In the current year the company made an increased profit before taxation of £2,273,991 (2022: £1,940,525) primarily as a result of an increase in turnover of 10% from £8,764,731 in 2022 to £9,657,467 in 2023. Cost of sales also increased from £1,701,573 to £2,135,414 as the company continued to invest in research and development to advance patient therapeutics.
Principal risks and uncertainties
The company has exposures to a variety of financial risks which are managed with the purpose of minimising potential adverse effect on the company's performance. Management has established risk management policies for managing each of these risks and they are summarised below:
Interest rate risk and inflation risk
The company has mitigated its inflation risk in that it's revenue and costs are largely linked via the company's transfer pricing agreement. The company has no external debt and therefore does not consider interest rate risk to be a significant risk. The company's exposure to interest and inflationary fluctuations will continue to be monitored.
Cash flow and liquidity risk
Liquidity risk is the risk that the company will not be able to meet its financial obligations as they fall due. The company adopts a prudent approach to liquidity management by maintaining sufficient cash and liquid resources to meet its obligations. The nature of the company is such that the cash flows are reasonably predictable.
Credit risk
Credit risk is the risk of financial loss to the company if a counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the company's receivables from customers. Management monitors amounts due carefully and do not consider there to be a significant credit risk. The company does not undertake financial instruments transactions which are speculative or unrelated to the company's trading activities.
Future Developments and Performance
The principal activity of the company will continue to be that of the development of new life science technologies with application in cell and gene therapies. The company will continue to contribute to advance therapeutics to bring hope to patients who suffer from neuromuscular, central nervous system, cardiovascular, metabolic and other disorders. To aid this the company will continue to recognise the importance of recruitment, retention and training of employees.
Key performance indicators
Monthly reports are prepared and monitored as part of the ongoing management of the company. Key performance indicators include turnover, operating profit/loss, tangible fixed assets, cash and cash equivalents and average monthly headcount all of which are detailed for current and comparative periods within the company's financial statements.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Cristina Gude
Director
30 September 2024
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
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 company continued to be that of the development of new life science technologies with application in gene therapies.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Richard Jude Samulski
(Resigned 8 May 2024)
Sheila Ann Mikhail
(Resigned 11 March 2023)
Gustavo Pesquin
(Appointed 11 March 2023)
Cristina Gude
(Appointed 8 May 2024)
Auditor
Johnston Carmichael LLP were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
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 future developments.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Cristina Gude
Director
30 September 2024
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The directors are responsible for preparing the strategic report, 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements 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 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.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
- 5 -
Opinion
We have audited the financial statements of AskBio UK Ltd (Formerly Synpromics Ltd) (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, balance sheet, statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
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.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
- 6 -
Matters on which we are required to report by exception
In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 4, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
- 7 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations by considering their experience, past performance and support available.
All engagement team members were briefed on relevant identified laws and regulations and potential fraud risks at the planning stage of the audit. Engagement team members were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
We obtained an understanding of the legal and regulatory frameworks that are applicable to the company and the sector in which it operates, focusing on those provisions that had a direct effect on the determination of material amounts and disclosures in the financial statements. The most relevant frameworks we identified include:
We gained an understanding of how the company is complying with these laws and regulations by making enquiries of management and those charged with governance. We corroborated these enquiries through our review of submitted returns and relevant correspondence.
We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur, by meeting with management and those charged with governance to understand where it was considered there was susceptibility to fraud. This evaluation also considered how management and those charged with governance were remunerated and whether this provided an incentive for fraudulent activity. We considered the overall control environment and how management and those charged with governance oversee the implementation and operation of controls. In areas of the financial statements where the risks were considered to be higher, we performed procedures to address each identified risk. We identified a heightened fraud risk in relation to:
In addition to the above, the following procedures were performed to provide reasonable assurance that the financial statements were free of material fraud or error:
Enquiring of those charged with governance for reference to: breaches of laws and regulation or for any indication of any potential litigation and claims; and events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud;
Reviewing the level of and reasoning behind the company’s procurement of legal and professional services;
Performing audit work procedures over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing judgements made by management in their calculation of accounting estimates for potential management bias;
Performing audit procedures to confirm the accuracy, occurrence and cut-off of revenue, ensuring recognised in line with the company's accounting policies;
Completion of appropriate checklists and use of our experience to assess the company’s compliance with the Companies Act 2006; and
Agreement of the financial statement disclosures to supporting documentation.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
- 8 -
Our audit procedures were designed to respond to the risk of material misstatements in the financial statements, recognising that 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 intentional concealment, forgery, collusion, omission or misrepresentation. There are inherent limitations in the audit procedures performed 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.
Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
Martin Bannerman (Senior Statutory Auditor)
For and on behalf of Johnston Carmichael LLP
30 September 2024
Statutory Auditor
7-11 Melville Street
Edinburgh
EH3 7PE
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
9,657,467
8,764,731
Cost of sales
(2,135,414)
(1,701,573)
Gross profit
7,522,053
7,063,158
Administrative expenses
(6,856,057)
(6,243,167)
Other operating income
4
1,578,175
1,118,202
Operating profit
5
2,244,171
1,938,193
Interest receivable and similar income
8
29,820
2,333
Amounts written off investments
9
-
(1)
Profit before taxation
2,273,991
1,940,525
Tax on profit
10
(480,599)
2,471,594
Profit and total comprehensive income for the financial year
1,793,392
4,412,119
The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Tangible assets
11
1,798,968
1,972,609
Current assets
Debtors falling due after more than one year
12
2,331,569
2,441,090
Debtors falling due within one year
12
10,249,560
9,297,977
Cash at bank and in hand
2,478,042
1,578,381
15,059,171
13,317,448
Creditors: amounts falling due within one year
13
(2,718,907)
(2,336,692)
Net current assets
12,340,264
10,980,756
Total assets less current liabilities
14,139,232
12,953,365
Creditors: amounts falling due after more than one year
14
(5,866,667)
(6,400,000)
Provisions for liabilities
Deferred tax liability
15
15,258
89,450
(15,258)
(89,450)
Net assets
8,257,307
6,463,915
Capital and reserves
Called up share capital
17
61,192
61,192
Share premium account
18
10,776,893
10,776,893
Capital redemption reserve
18
413
413
Other reserves
18
2,370,328
2,370,328
Profit and loss reserves
18
(4,951,519)
(6,744,911)
Total equity
8,257,307
6,463,915
The financial statements were approved by the board of directors and authorised for issue on 30 September 2024 and are signed on its behalf by:
Cristina Gude
Director
Company Registration No. SC384375
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Share premium account
Capital redemption reserve
Other reserves
Profit and loss reserves
Total
£
£
£
£
£
£
As restated for the period ended 31 December 2022:
Balance at 1 January 2022
31,682
7,855,403
413
2,370,328
(11,157,030)
(899,204)
Prior period adjustment
22
29,510
2,921,490
-
2,951,000
As restated
61,192
10,776,893
413
2,370,328
(11,157,030)
2,051,796
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
-
4,412,119
4,412,119
Balance at 31 December 2022
61,192
10,776,893
413
2,370,328
(6,744,911)
6,463,915
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
-
-
1,793,392
1,793,392
Balance at 31 December 2023
61,192
10,776,893
413
2,370,328
(4,951,519)
8,257,307
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
AskBio UK Ltd (Formerly Synpromics Ltd) is a private company limited by shares incorporated in Scotland. The registered office is Roslin Innovation Centre, Easter Bush Campus, Midlothian, EH25 9RG.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income; and
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Bayer Aktiengesellschaft (Bayer AG). These consolidated financial statements are available from its registered office, Bayer AG, KaiserWilhelm-Allee 1, 51368 Leverkusen.
1.2
Going concern
The directors have prepared cash flow forecasts which they believe to be reasonable and achievable in demonstrating the company has sufficient resources to meet its external liabilities for a period of at least 12 months from the date of approval of these financial statements. The company’s immediate parent undertaking has provided formal support that it will continue to operate under and settle amounts owed to AskBio UK Ltd in accordance with the service income agreement between the companies over the aforementioned period.true
The directors therefore believe that it is appropriate to prepare the financial statements on a going concern basis.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.3
Turnover
The company has generated revenue through commercial agreements. The company recognised revenue when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the price if fixed or determinable; and (4) collection of the amounts due is reasonably assured.
Services to group companies income is in the form of a transfer pricing arrangement based on allocation of cost plus a margin.
In relation to the sale of intellectual property, the company is deemed to transfer control of the intellectual property over time and therefore satisfies performance obligations and recognises revenue over time. The time period in which revenue is expected to be recognised over is 15 years from the date of the agreement for sale of the intellectual property (1 January 2021). This is based upon the estimated useful life of the intellectual property.
The company evaluates the terms of grants to assess the company's obligations and if the company's obligations are satisfied when the grant is received, revenue is recognised upon receipt of the grant. Government grants received have been included within other income.
Amounts received prior to satisfying the revenue recognition criteria are recorded as deferred revenue in the company's balance sheets. Amounts expected to be recognised as revenue within 12 months following the balance sheet date are classified as current liabilities.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses. Low value assets of £2,500 or less are capitalised and fully depreciated in the month of capitalisation.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Plant and equipment
20% on cost
Fixtures and fittings
10% on cost
Computer equipment
33% on cost
Low value assets
100% on cost
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.5
Impairment of fixed assets
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.
Non-financial assets
An asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.
Financial assets
For financial assets carried at amortised cost, the amount of impairment is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the financial asset's original effective interest rate.
For financial assets carried at cost less impairment, the impairment loss is the difference between the asset's carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and 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.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors and loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.8
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
Current tax
Current tax is recognised for the amount of income tax payable in respect of the taxable profit for the current or past reporting periods using the tax rates and laws that have been enacted or substantively enacted by the reporting date.
Deferred tax
Deferred tax is recognised in respect of all timing differences at the reporting date, except as otherwise indicated. Deferred tax assets are only recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. If and when all conditions for retaining tax allowances for the cost of a fixed asset have been met, the deferred tax is reversed.
Deferred tax is calculated using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference. With the exception of changes arising on the initial recognition of a business combination, the tax expense (income) is presented either in profit or loss, other comprehensive income or equity depending on the transaction that resulted in the tax expense (income).
Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. Deferred tax assets and deferred tax liabilities are offset only if the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously.
Research and development tax credits
Research and development tax credits are recognised on a systematic basis as the entity recognises costs which are eligible for research and development tax credits, and only to the extent that the directors are satisfied based on previous claims, the amounts will be recoverable.
Research and development expenditure credits are recognised within operating income and small or medium sized enterprise tax relief is recognised within the taxation line in the Statement of Comprehensive Income.
1.10
Retirement benefits
The company contributes to a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.12
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.13
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Government grants are recognised in accordance with the performance model. A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.14
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.
1.15
Research expenditure is written off to the profit and loss account in the year in which it is incurred. Identifiable development expenditure is written off in the same way unless the directors are satisfied as to the technical, commercial and financial feasibility of the project. In this situation, the expenditure is deferred and amortised over the period during which the company is expected to benefit.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Key sources of estimation uncertainty
Intellectual property revenue recognition
The company is deemed to transfer control of the intellectual property over time and therefore satisfies performance obligations and recognises revenue over time. The time period in which revenue is expected to be recognised over is 15 years from the date of the agreement for sale of the intellectual property (1 January 2021). This is based upon the estimated useful life of the intellectual property. In assessing useful life, the parties to the agreement for sale of the intellectual property, use careful judgement based on past experience, advances in product development and also best practice.
Recognition of deferred tax asset
The company has accumulated losses of £9,287,598 which have been carried forward and will be offset against future taxable profits. A deferred tax asset has been recognised for the tax losses. Deferred tax is provided for at 25% in the financial statements. The deferred tax asset has been recognised on those tax losses which can be off set off against future profits of the company. The future profits of the company have been estimated based on the forecasted cash flows and its estimated contractual rights and obligations.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Service Income
9,124,134
7,667,487
Partner/ Other Income
-
30,577
Sale of Intellectual Property
533,333
1,066,667
9,657,467
8,764,731
2023
2022
£
£
Other significant revenue
Interest income
29,820
2,333
4
Other operating income
2023
2022
£
£
Grant income
580,941
600,000
RDEC tax credit
997,234
518,202
1,578,175
1,118,202
5
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
(5,425)
197,144
Fees payable to the company's auditor for the audit of the company's financial statements
24,220
20,750
Depreciation of owned tangible fixed assets
554,164
478,258
Operating lease charges
365,118
372,327
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Scientific
47
46
Administrative
10
6
Total
57
52
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 19 -
2023
2022
£
£
Wages and salaries
3,313,816
2,915,367
Social security costs
456,209
408,273
Pension costs
373,227
123,787
4,143,252
3,447,427
7
Directors' remuneration
Directors are remunerated through the parent company, Asklepios BioPharmaceutical Inc.
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
29,820
2,333
9
Amounts written off investments
2023
2022
£
£
Other gains and losses
-
(1)
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
301,978
443
Adjustments in respect of prior periods
143,291
Total current tax
445,269
443
Deferred tax
Origination and reversal of timing differences
247,574
459,934
Previously unrecognised tax loss, tax credit or timing difference
(2,931,971)
Adjustment in respect of prior periods
(212,244)
Total deferred tax
35,330
(2,472,037)
Total tax charge/(credit)
480,599
(2,471,594)
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 20 -
The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
2,273,991
1,940,525
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
534,388
368,700
Adjustments in respect of prior years
(68,953)
Research and development tax credit
(18,707)
Deferred tax adjustments in respect of prior years
(2,931,971)
Effect of change in tax rates
15,164
110,384
Taxation charge/(credit) for the year
480,599
(2,471,594)
11
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computer equipment
Low value assets
Total
£
£
£
£
£
Cost
At 1 January 2023
3,064,606
300,783
3,365,389
Additions
220,476
11,407
267,507
21,212
520,602
Disposals
(490,189)
(490,189)
Transfers
(12,486)
8,123
4,363
At 31 December 2023
2,782,407
19,530
572,653
21,212
3,395,802
Depreciation and impairment
At 1 January 2023
1,216,732
176,048
1,392,780
Depreciation charged in the year
474,440
43,525
14,987
21,212
554,164
Eliminated in respect of disposals
(350,110)
(350,110)
Transfers
(3,765)
(41,594)
45,359
At 31 December 2023
1,337,297
1,931
236,394
21,212
1,596,834
Carrying amount
At 31 December 2023
1,445,110
17,599
336,259
1,798,968
At 31 December 2022
1,847,874
124,735
1,972,609
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
as restated
Trade debtors
68,093
Corporation tax recoverable
1,114,928
920,567
Amounts owed by group undertakings
8,417,641
7,465,115
Other debtors
114,233
154,002
Prepayments and accrued income
602,758
690,200
10,249,560
9,297,977
2023
2022
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 15)
2,331,569
2,441,090
Total debtors
12,581,129
11,739,067
Amounts owed by group undertakings are unsecured, interest free and repayable on demand.
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
649,254
482,254
Other creditors
375,416
27,504
Accruals and deferred income
1,694,237
1,826,934
2,718,907
2,336,692
Included within accruals and deferred income is an intercompany deferred income balance of £808,427 (2022: £533,333).
Included within trade creditors are intercompany amounts of £487,854 (2022: £nil).
14
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Deferred income
5,866,667
6,400,000
Included within deferred income is an intercompany deferred income balance of £5,866,667 (2022: £6,400,000).
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
15
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Balances:
£
£
£
£
Accelerated capital allowances
15,258
89,450
-
-
Tax losses
-
-
2,321,899
2,441,090
Other short term timing differences
-
-
9,670
-
15,258
89,450
2,331,569
2,441,090
The movement in deferred tax balances in the year have all been charged / (credited) to the profit and loss account, as detailed in note 10 to the financial statements
The deferred tax asset set out above is expected to reverse within 5 years and relates to the utilisation of tax losses against future expected profits of the same period. The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.
16
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
373,227
123,787
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
17
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
as restated
as restated
Issued and fully paid
Ordinary shares of 1p each
6,119,144
6,119,144
61,192
61,192
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
18
Reserves
Other reserves
Represents a capital contribution in relation to share-based compensation of the parent entity's shares. During the year ended 31 December 2020, and on acquisition of the immediate parent Company AskBio by Bayer Healthcare LLC, the share option scheme was cancelled. As part of the share option cancellation, the parent entity contributed funds for settlement of the share options which have been included as a capital contribution.
Retained earnings
Includes all current and prior period retained profits and losses.
Share Premium
Share premium reserve relates to amounts paid above par value of the shares net of any legal fees incurred in relation to the share issues.
Capital Redemption Reserve
Represents the historic buy back and cancellation of 41,250 "B" hurdle shares.
19
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
313,852
Between two and five years
218,407
532,259
20
Related party transactions
The company has applied the exemption granted by section 33 of FRS 102 not to disclose transactions with wholly owned group companies.
21
Ultimate controlling party
The company is 100% owned by Asklepios Biopharmaceutical Inc. whose headquarters are at 20 T.W. Alexander Drive, Suite 110, Research Triangle Park, NC 27709. The ultimate parent undertaking and controlling party is Bayer AG, a company incorporated in Germany, which is the parent undertaking of the smallest and largest group to consolidate these financial statements.
ASKBIO UK LTD (FORMERLY SYNPROMICS LTD)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
22
Prior period adjustment
Changes to the balance sheet
As previously reported
Adjustment at 1 Jan 2022
Adjustment at 31 Dec 2022
As restated at 31 Dec 2022
£
£
£
£
Current assets
Debtors due within one year
6,346,977
2,951,000
-
9,297,977
Capital and reserves
Called up share capital
31,682
29,510
-
61,192
Share premium account
7,855,403
2,921,490
-
10,776,893
Total equity
3,512,915
2,951,000
-
6,463,915
The company issued 2,951,000 0.1p Ordinary shares on 23 December 2021 for a price of £1 per share. A prior year restatement has been made to record this transaction. The effect of this restatement is an increase in the opening reserves at 1 January 2022 to recognise £29,510 additional share capital and £2,921,490 additional share premium. A corresponding debtor representing amounts owed by the company's parent undertaking in respect of the aforementioned share issue has also been recognised at 1 January 2022. There is no impact on the opening retained earnings position at 1 January 2022 and 1 January 2023.
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