Registered number:
FOR THE PERIOD ENDED 31 MARCH 2024
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COMPANY INFORMATION
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CONTENTS
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GROUP STRATEGIC REPORT
FOR THE PERIOD ENDED 31 MARCH 2024
The Directors present their Strategic Report for Toqio Fintech Holdings Limited (the “Company”) and its subsidiary undertakings (the “Group”) for the period ended 31 March 2024.
The principal activity of the Company during the year was that of a holding company for a set of operating subsidiaries. The principal activity of the Group is that of providing a software as a service product that allows financial and non-financial organisations to create and launch their own fully-branded banking or finance solution as an application or on the web.
As set out in the Consolidated Statement of Comprehensive Income on page 10, the Group has made a loss in the year of £5,638,388 (2022: £4,975,780). As set out in the Consolidated Balance Sheet on page 11, the net assets of the Group as at 31 March 2024 were £10,643,222 (2022: £16,274,054).
The year ended 31 March 2024 results reflect the fact that the Group has continued investing in product, technology, and go-to-market capabilities while revising its commercial strategy in light of prevailing market conditions. The €20m capital raise was intended to support said investment. The Group’s operating loss in the period is therefore to be interpreted as part of an intentional growth and business development strategy in line with market practice for venture-backed enterprises. Key product and technology development in the period included:
∙Development of business banking and treasury capabilities
∙Development of card program capabilities
∙Progress on GDPR and PCI compliance
∙New integrations with 3rd-party providers
∙Enhanced reporting capabilitie
Additionaly, the Group developed substantial in-house direct Sales and Marketing capabilities and levelled up a number of operational processes related to finance, people, and internal operations.
Looking forward, the Group plans to focus on further developing its product and technology and enable the successful commercialisation of its software platform to larger, more established corporate clients - Primarily across the UK and the European Union.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2024
The Directors have considered the risks which are most significant to the business in terms of both operational and financial impact. Those with a material impact on the Group’s long-term performance are detailed below:
Strategic Risk
This is the risk of the Group not meeting its strategic objectives. The Group’s management and Board of Directors periodically review the Group’s operational and financial results at a granular level, and either agree on concrete actions required to achieve the strategic objectives, or agree to update said strategic objectives to ensure the sustainability of the Group’s operations.
Credit Risk
This is the risk of financial losses arising from the Group being unable to recover funds owed to it. The primary risk comes from the Group’s outstanding customer balances. The Group seeks to mitigate this risk by incorporating thorough credit approval systems and different payment methods for customers depending on the credit review's outcome. The rules followed on the credit approval systems are reviewed regularly and analysed on a case-by-case basis, to ensure they mitigate the risk to an acceptable level.
Liquidity Risk
This is the risk of the Group failing to meet its financial obligations as a result of insufficient cash being available. The Group monitors its cash position regularly and uses forecasting techniques to ensure it has sufficient cash to meet its operational requirements. A number of cost-reduction initiatives can be implemented as required to preserve cash and extend the Group’s cash runway.
Regulatory Risk
This is the risk of failing to comply with regulatory requirements applying to business arrangements and activities. The Group endeavours to be compliant with all applicable regulations and laws by monitoring adherence to internal rules and using external relevant advice and guidance.
The Group monitors the following key performance indicators (“KPIs”) on a regular basis by way of assessing monthly management accounts. Some of the principal KPIs include:
∙No. of customers
∙Contracted ARR
∙Invoiced ARR
∙Live ARR
∙Revenue
∙Expenses / Overheads
∙Net Dollar Retention
∙Customer Churn
∙LTV (Customer Lifetime Value) and CAC (Customer Acquisition Cost)
∙Monthly Cash Burn
Other key performance indicators are used to help Directors monitor the financial performance of the Group and are as follows for the 15 months ended 31 March 2024:
Revenue: £1,859,083 (2022: £1,621,010)
EBITDA: loss of £4,561,686 (2022: loss of £4,521,711)
Net Current Assets: £7,019,553 (2022: £12,839,196)
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2024
Directors' statement of compliance with duty to promote the success of the Company
The Directors of Toqio Fintech Holdings Ltd consider that they have fulfilled their individual and collective duty under section 172(1) of the Companies Act 2006 to act in the way they consider, in good faith, would be mostlikely to promote the success of the Group for the benefit of the shareholders as a whole. This has been achieved through strong systemic controls; investment in our staff through training and incentives; and a focus on high standards of customer service. All share classes have had representation at Board level and the Board is committed to a strategy that will drive long term value for the equity holders in the business.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 MARCH 2024
The directors present their report and the financial statements for the period ended 31 March 2024.
The directors who served during the period were:
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The loss for the period, after taxation, amounted to £5,638,388 (2022 - loss £4,975,780).
Looking forward, the Group plans to focus on further developing its product and technology and enable the successful commercialisation of its software platform to larger, more established corporate clients - Primarily across the UK and the European Union.
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DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2024
There have been no significant events affecting the Group since the year end.
The auditors, Warrener Stewart, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOQIO FINTECH HOLDINGS LTD
We have audited the financial statements of Toqio Fintech Holdings Ltd (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 31 March 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 or the 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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOQIO FINTECH HOLDINGS LTD (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOQIO FINTECH HOLDINGS LTD (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Our assessment of the susceptibility of the entity's financial statements to material misstatement, including how fraud might occur, is considered to be low. This conclusion was reached after consideration of the following:
∙a high level of review of key performance and similar indicators;
∙a high level of informed management within senior and finance management;
∙the general absence of individuals with opportunity and authority to override controls undetected; and
∙a high level of long service, experience and trust within key finance management.
We designed our audit procedures to respond to identified audit risks, including non-compliance with laws and regulations (irregularities) that are material to the financial statements. Some of the specific procedures performed to detect irregularities, including fraud, are detailed below:
∙review of control accounts and journal entries for large, unusual or unauthorised entries including management override;
∙analytical review of the detailed profit and loss account for variances that are either unexpected or felt not to be in accordance with our understanding of the business during the year; and
∙obtaining and reviewing for completeness a list of entities and persons considered to be related parties (as defined by Financial Reporting Standard 102) and reviewing the ledgers of the Group for previously unreported related party transactions.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TOQIO FINTECH HOLDINGS LTD (CONTINUED)
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 Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditors
Harwood House
43 Harwood Road
SW6 4QP
Date:
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 MARCH 2024
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CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2024
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CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 38 form part of these financial statements.
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COMPANY BALANCE SHEET
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 38 form part of these financial statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 MARCH 2024
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COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 MARCH 2024
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CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 MARCH 2024
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CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2024
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CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Toqio Fintech Holdings Limited is incorporataed and domiciled in England and Wales. The registered
office is Harwood House, 43 Harwood Road, London, SW6 4QP.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases. In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 21 March 2021.
The group made a loss after taxation for the year ended 31 March 2024 of £5,638,388 (2022: £4,975,780). The group has continued to develop and refine its product since the year end and as a result the product has gone live for a number of clients in 2024. In addition, the group continues to build its client base as a number of new licence agreements have been finalised and signed since the year end. The group has strong cash reserves sufficient to support operations during 2025 and beyond. The company's medium term policy is to pursue aggressive growth over the next few years while crafting a pathway to profitability.
In the light of this and after taking into account all information that could reasonably be expected to be available, the director is satisfied that the group will continue in operational existence for the foreseeable future, and that the going concern basis is appropriate for the preparation of the group's financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
2.Accounting policies (continued)
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight-line basis over their useful economic lives, which range from 3 to 10 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only. Grants of a revenue nature are recognised in the Consolidated Statement of Comprehensive Income in the same period as the related expenditure.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Group's Balance Sheet when the Group 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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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, if the revision affects only that period, or in the period of the revision and future periods of the revision affects both current and future periods. Critical accounting estimates and assumptions are as follows;
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Analysis of turnover by country of destination:
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
23.Share capital (continued)
Share premium account
Foreign exchange reserve
and balances from the functional currency of the company's subsidiary undertaking in EUR to its presentational currency in GBP.
Other reserves
Profit and loss account
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £6,774 (2022 - £7,466). Contributions totalling £1,535 (2022 - £1,335) were payable to the fund at the balance sheet date and are included in creditors.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
The Directors do not consider there to be an ultimate controlling party.
Toqio Fintech Holdings Ltd is the parent undertaking of the smallest and largest Group of undertakings to consolidate these financial statements at 31 March 2024.
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