Company registration number 12405481 (England and Wales)
A.S.K. PARTNERS LENDCO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
A.S.K. PARTNERS LENDCO LIMITED
COMPANY INFORMATION
Directors
D B Austin
D R J King
Company number
12405481
Registered office
35 Harley Street
London
W1G 9QU
Independent Auditors
PricewaterhouseCoopers LLP
1 Hardman Square
Manchester
M3 3EB
Business address
35 Harley Street
London
W1G 9QU
A.S.K. PARTNERS LENDCO LIMITED
CONTENTS
Pages
Directors' report
1 - 4
Directors' responsibilities statement
5
Statement of comprehensive income
6
Balance sheet
7
Statement of changes in equity
8
Notes to the financial statements
9 - 14
Independent auditors' report
15 - 18
A.S.K. PARTNERS LENDCO LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present their annual report and financial statements for A.S.K. Partners Lendco Limited ('the company') for the year ended 31 December 2023. The financial statements for the year ended 31 December 2022 are unaudited.
Principal activities
The principal activity of the company is acting as the lead lender on secured property loans. The loans are funded by a combination of financial institutions, private high net worths and A.S.K group companies. The company earns income from interest income on the underlying loans made to third-party borrowers.
Results and dividends
The financial year to 31 December 2023 was a satisfactory performance. The statements of comprehensive income and the statement of the financial position can be found on page 6 and 7 respectively.
In summary, the company’s income increased by 60% to £3.8m due to the growth in loans under management and a corresponding increase in interest income. Profit before tax also increased significantly to £3.5m (58% higher than prior year). The company has minimal operational costs and no employees. A bad debt provision of £0.2m was raised in the year in relation to uncertainty on recoverability of certain trade receivables due to the impact of the current market conditions on property values.
The Directors did not pay or recommend a dividend in the year to 31 December 2023 (2022: Nil).
Going Concern
The directors have reviewed the company's financial position and cash flow forecasts for the foreseeable future.
Based on this review, the directors are satisfied that the company has adequate resources to continue operating for the foreseeable future (being at least 12 months from the date of approval of these financial statements). Therefore, they continue to adopt the going concern basis in preparing the financial statements.
Risk Management
The directors recognise the importance of effective risk management for sustaining long-term growth. Comprehensive risk management policies are in place to identify, assess, and mitigate potential risks, including credit, liquidity, market, and operational risks. Regular reviews and updates ensure these policies remain effective and aligned with industry best practices.
A.S.K. PARTNERS LENDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Credit Risk:
Exposure to risk
The Company’s receivable balance is dependent upon the performance of the underlying borrower and the value of the secured property. The receivables balance, which total £2.3m net of provisions, has primarily increased in the last year because of the increase in the size of the underlying loan book.
The repayment of the Company’s receivables balance is dependent on repayment by the underlying borrowers. The directors have applied a provision against certain loans where there is uncertainty on their collectability.
Objectives, policies, and processes for managing Risk
Comprehensive borrower credit assessments before entering into agreements, including obtaining valuations on the underlying secured property prepared by an independent qualified RICS valuer (Royal Institution of Chartered Surveyors).
Target a diverse borrower base and a broad coverage of different property sectors and locations to avoid too much concentration risk.
Regularly monitor performance of the underlying borrower and property asset management strategy against borrower’s business plan.
Monitoring of economic indicators and adjusting lending strategies accordingly.
Changes from the previous period
Liquidity Risk:
Exposures to risk
Inability to meet short-term financial obligations which total £0.2m.
Part of the Company’s cash inflow is linked to the performance of underlying loans and the ability of borrowers to redeem loans or sell the secured property. In the foreseeable future these inflows will cover these obligations.
Financial instrument risk is managed through matching floating and fixed rates for borrowers and funding partners.
Objectives, policies, and processes for managing risk
Changes from the previous period
A.S.K. PARTNERS LENDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Market Risk:
Exposures to risk
Objectives, policies, and processes for managing risk
Changes from the previous period
Operational Risk:
Exposure to risk
Objectives, policies, and processes for managing risk
Maintain a robust operating system.
Dedicated operational support base across Finance, Risk, Compliance and Investor Relations.
Changes from previous period
Continued improvement in internal control environment.
Expansion of support base across Finance, Risk, Compliance and Investor relations in the last year.
Market Analysis
Rising interest rates have led to higher borrowing costs, impacting both residential and commercial real estate lending. Lenders have become more cautious, tightening credit standards to manage risk. The fall in property values has resulted in an increase in the loan to value for the underlying loans and this has required additional loan monitoring processes to be adopted.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
D B Austin
(Appointed 15 January 2020)
D R J King
(Appointed 15 January 2020)
Qualifying third party indemnity provisions
The company has qualifying third party indemnity provisions for the benefit of the respective directors which were in place throughout the year and remain in place at the date of this report.
Post reporting date events
There are no post-balance sheet events that impact the financial statements as of 31 December 2023.
Future developments
The directors are cautiously optimistic about the future prospects of the company. The demand for real estate financing is expected to remain strong, providing ample opportunities for growth, albeit in a highly competitive marketplace. The directors are mindful of the challenging macro-economic conditions which continue to be felt in the United Kingdom and the adverse effects this causes on the country’s property values.
A.S.K. PARTNERS LENDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
Independent Auditors
A resolution to reappoint PricewaterhouseCoopers LLP as auditors of the company will be proposed at the forthcoming Board Meeting.
Energy and carbon report
As the company has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.
On behalf of the board
D R J King
Director
2 October 2024
A.S.K. PARTNERS LENDCO LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulation.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law).
Under company law, 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 the financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
state whether applicable United Kingdom Accounting Standards, comprising FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements;
make judgements and accounting estimates that are reasonable and prudent; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors are also 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.
Directors’ confirmations
In the case of each director in office at the date the directors’ report is approved:
so far as the director is aware, there is no relevant audit information of which the company’s auditors are unaware; and
they 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 auditors are 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.
PricewaterhouseCoopers LLP (PwC) were appointed as the Company’s Auditors on 4 December 2023.
On behalf of the board
D R J King
Director
2 October 2024
A.S.K. PARTNERS LENDCO LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
2023
2022 unaudited
Notes
£
£
Turnover
3
3,756,909
2,351,268
Cost of sales
4
(11,112)
(134,084)
Gross profit
3,745,797
2,217,184
Administrative expenses
5, 6, 7
(280,809)
(7,920)
Operating profit
3,464,988
2,209,264
Interest receivable and similar income
8
16,814
Profit before taxation
3,481,802
2,209,264
Tax on profit
9
(818,939)
(419,760)
Profit for the financial year
2,662,863
1,789,504
The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
The notes on pages 9 to 14 form part of these financial statements.
A.S.K. PARTNERS LENDCO LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 7 -
2023
2022 unaudited
Notes
£
£
£
£
Current assets
Debtors
10
5,808,813
3,851,423
Creditors: amounts falling due within one year
11
(220,637)
(421,680)
Total assets less current liabilities
5,588,176
3,429,743
Creditors: amounts falling due after more than one year
12
(504,430)
Net assets
5,588,176
2,925,313
Capital and reserves
Called up share capital
13
1
1
Profit and loss account
5,588,175
2,925,312
Total equity
5,588,176
2,925,313
The notes on pages 9 to 14 form part of these financial statements.
The financial statements on page 6 to 14 were approved by the board of directors and authorised for issue on 2 October 2024 and are signed on its behalf by:
D R J King
Director
Company registration number 12405481 (England and Wales)
A.S.K. PARTNERS LENDCO LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
Share capital
Profit and loss account
Total
£
£
£
Balance at 1 January 2022, unaudited
1
1,135,808
1,135,809
Year ended 31 December 2022:
Profit and total comprehensive income, unaudited
-
1,789,504
1,789,504
Balance at 31 December 2022, unaudited
1
2,925,312
2,925,313
Year ended 31 December 2023:
Profit and total comprehensive income
-
2,662,863
2,662,863
Balance at 31 December 2023
1
5,588,175
5,588,176
The notes on pages 9 to 14 form part of these financial statements.
A.S.K. PARTNERS LENDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
1
Accounting policies
Company information
A.S.K. Partners Lendco Limited ("the company") is a private company limited by shares incorporated in England and Wales. The registered office is 35 Harley Street, London, W1G 9QU.
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 pound sterling.
The financial statements have been prepared under the historical cost convention. The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
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 33 ‘Related Party Disclosures’: Compensation for key management personnel and related party transactions with other companies that are wholly owned within the Group.
The financial statements of the company are consolidated in the financial statements of Oaknorth Bank Plc. These consolidated financial statements are available from its registered office, 3/F, 57 Broadwick Street, London, W1F 9QS.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future (being at least 12 months from the date of approval of the financial statements). Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover includes Loan Interest income. Loan Interest is the difference between the interest rate charged to borrowers and the interest rate paid to investors. Loan Interest is recognised on the accrual basis over the period in which the interest accrues, reflecting the time value of money.
1.4
Cost of sales includes transaction costs and represents the direct cost for these services. These costs are recognised when the cost is incurred.
1.5
Administrative expenses include Operational costs incurred in the normal course of business, accounted for in the period to which they relate and Bad debt provisions, accounted for in the period in which the respective recovery risk value is identified for the underlying asset.
A.S.K. PARTNERS LENDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 10 -
1.6
Financial instruments
The company 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 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, 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.
Provision of financial assets
Financial assets, other than those held at fair value through statement of comprehensive income, are assessed for indicators of provision at each reporting end date.
Financial assets are provided for 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.
Factors taken into accounted in assessing the provision of the financial assets include deal performance, current market conditions, interest rates and the impact on repayments, best estimate property valuations and management expertise.
If an asset is provided for, the provision loss is the difference between the carrying amount and the estimated cash recovery. The provision loss is recognised in statement of comprehensive income.
If there is a decrease in the provision loss arising from an event occurring after the provision was recognised, the provision is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the provision not previously been recognised. The provision reversal is recognised in statement of comprehensive income.
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 are classified according to the substance of the contractual arrangements entered into.
Basic financial liabilities
Basic financial liabilities, including Creditors are classified as debt and are initially recognised at transaction price. Creditors payable within one year are not amortised.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Other Creditors 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.
A.S.K. PARTNERS LENDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.7
Taxation
The tax expense represents the sum of the tax currently payable.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the statement of comprehensive income 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
1.8
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.
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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Bad debt provisions
Judgement estimates have been applied in assessing the bad debt provision on trade debtors considering expected recoverability of the outstanding balances based on best estimate property valuations which are impacted by market conditions and recent selling prices of similar assets.
If the estimates used in the recoverability valuation were 2% lower, the the bad debt provision would have been £42,105 higher for the year, however if the estimates were 2% higher, the bad debt provision would have been £55,867 lower for the year.
3
Turnover
2023
2022 unaudited
£
£
Turnover analysed by class of business
Interest income
3,756,909
2,351,268
All turnover arises from activities in the UK
A.S.K. PARTNERS LENDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
4
Cost of sales
Cost of sales represented transaction costs of £11,112 (2022: £134,084).
5
Administrative expenses
The amount is made up of Bad debt provision of £212,324 (2022: £nil); Accountancy fees of £2,085 (2022: £1,920); Legal fees £nil (2022: £6,000) and Audit fees of £66,400 (2022: £nil).
6
Auditors' remuneration
2023
2022 unaudited
Fees payable to the company's auditors and associates:
£
£
For audit services
Audit of the financial statements of the company
40,000
Auditors remuneration above excludes non-claimable VAT and accrued estimated overrun costs.
7
Employees
The average monthly number of persons (excluding directors) employed by the company during the year was:
2023
2022 unaudited
Number
Number
Total
The 2 directors of the company are employed by the group.
8
Interest receivable and similar income
2023
2022 unaudited
£
£
Interest income
Other interest income
16,814
Interest receivable represents interest received on corporation tax paid in advance.
9
Tax on profit
2023
2022 unaudited
£
£
Current tax
UK corporation tax on profits for the current year
818,939
419,760
A.S.K. PARTNERS LENDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Tax on profit
(Continued)
- 13 -
Corporation tax rate has increased from 19% to 25% from 1 April 2023.
The actual charge 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 unaudited
£
£
Profit before taxation
3,481,802
2,209,264
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022 unaudited: 19.00%)
818,939
419,760
Taxation charge in the financial statements
818,939
419,760
10
Debtors
2023
2022 unaudited
Amounts falling due within one year:
£
£
Trade debtors
2,293,436
Amounts owed by group undertakings
3,515,377
3,851,423
5,808,813
3,851,423
Trade Debtors are shown net of bad debt provision of £212,324 (2022: nil).
11
Creditors: amounts falling due within one year
2023
2022 unaudited
£
£
Corporation tax
152,125
419,760
Accruals and deferred income
68,512
1,920
220,637
421,680
12
Creditors: amounts falling due after more than one year
2023
2022 unaudited
£
£
Other borrowings
504,430
A.S.K. PARTNERS LENDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
13
Share capital
2023
2022 unaudited
2023
2022 unaudited
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary share of £1 each
1
1
1
1
Each share has full rights in the company with respect to voting, dividends and distributions.
14
Related party transactions
The following amounts were outstanding at the reporting end date:
2023
2022 unaudited
Amounts due from related parties
£
£
Entities with control or significant influence over the company
3,515,377
3,851,423
The balance represents amount due from A.S.K. Partners Limited ('APL'), the immediate holding company, being accumulated loan interest margin of the Company since the Company does not have a bank account.
The amount is non-interest bearing and is repayable on demand.
15
Ultimate controlling party
The immediate parent company is A.S.K Partners Limited, registered at 35 Harley Street, London, W1G 9QU.
The ultimate controlling party is OakNorth Holdings Limited, registered at Ordnance House, 31 Pier Road, St Helier, Jersey, JE4 8PW
The largest group in which the results of the company are consolidated is that prepared by Oaknorth Bank Plc, registered at 3/F, 57 Broadwick Street, London, W1F 9QS.
16
Subsequent events
There were no subsequent events after the balance sheet date that we aware of that would impact the financial statements as reported above.
A.S.K. PARTNERS LENDCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF A.S.K. PARTNERS LENDCO LIMITED
- 15 -
Qualified opinion
In our opinion, except for the possible effects of the matter described in the Basis for qualified opinion paragraph below, A.S.K. Partners Lendco Limited’s 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 (United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law); and
have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements, included within the Annual Report and Financial Statements (the “Annual Report”), which comprise: the Balance sheet as at 31 December 2023; the Statement of comprehensive income and the Statement of changes in equity for the year then ended; and the notes to the financial statements, which include a description of the significant accounting policies.
Basis for qualified opinion
During the course of our audit for the year ended 31 December 2023, we were unable to obtain sufficient appropriate audit evidence to support the opening trade receivables balance. Since opening trade receivables enter into the determination of the financial performance of the company, we were unable to determine whether adjustments might have been necessary in respect of the profit for the year ended 31 December 2023 reported in the Statement of comprehensive income.
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
Independence
We remained independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
Conclusions relating to going concern
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.
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.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the company's ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
A.S.K. PARTNERS LENDCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF A.S.K. PARTNERS LENDCO LIMITED (CONTINUED)
- 16 -
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities.
With respect to the Directors' report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.
Directors' report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Directors' report for the year ended 31 December 2023 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Directors' report, except for the possible effects of the matter described in the Basis for qualified opinion paragraph above.
A.S.K. PARTNERS LENDCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF A.S.K. PARTNERS LENDCO LIMITED (CONTINUED)
- 17 -
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Directors' responsibilities statement, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they 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.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to UK Companies Act 2006, and we considered the extent to which non-compliance might have a material effect on the financial statements. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to management bias in assumptions used in accounting estimates and posting inappropriate journal entries. Audit procedures performed by the engagement team included:
Enquiries of management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud;
identifying and testing journal entries that we assessed as having a higher risk of being fraudulent;
challenging assumptions and judgements made by management in their accounting estimates, in particular in relation to the bad debts provision; and
incorporating unpredictability into the nature, timing and/or extent of our testing above.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. 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 for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
A.S.K. PARTNERS LENDCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF A.S.K. PARTNERS LENDCO LIMITED (CONTINUED)
- 18 -
Companies Act 2006 exception reporting
In respect solely of the limitation on our work relating to obtaining sufficient appropriate audit evidence to support the opening trade receivables balance, described in the Basis for qualified opinion paragraph above:
we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
we were unable to determine whether adequate accounting records have been kept by the company.
Under the Companies Act 2006 we are also required to report to you if, in our opinion:
returns adequate for our audit have not been received from branches not visited by us; or
certain disclosures of directors’ remuneration specified by law are not made; or
the financial statements are not in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Entitlement to exemptions
Under the Companies Act 2006 we are required to report to you if, in our opinion, the directors were not entitled to: take advantage of the small companies exemption from preparing a strategic report. We have no exceptions to report arising from this responsibility.
The financial statements for the 31 December 2022, forming the corresponding figures of the financial statements for the year ended 31 December 2023, are unaudited.
Daniel Pearce (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Manchester
2 October 02 October 20242024
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