The director presents their annual report and financial statements for the year ended 31 December 2023.
The results for the year are set out on page 8.
No dividends were paid. The directors do not recommend payment of a final dividend.
The director who held office during the year and up to the date of signature of the financial statements was as follows:
The auditor, Johnston Carmichael LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Going concern
In preparing the financial statements, the director has assessed the ability of the company to continue trading as a going concern. As the principal activity of the company is that of a holding company, the directors' assessment has primarily focused on the ability of the company to meet its loan and interest obligations payable to LumiraDx International Ltd.
At the time of approving the financial statements, the director is in the process of completing a deal that will secure the company’s ability to continue to operate and to meet its liabilities as they fall due for a period of at least 12 months from the date of approving the financial statements. In the interim, the administrator of LumiraDx International Ltd has confirmed they will not seek repayment of amounts due to that entity whilst they remain as office holders. On this basis, and having considered the remote likelihood of the aforementioned deal not completing, the director is satisfied that there is no material uncertainty regarding the company’s ability to continue to operate as a going concern and has therefore prepared the financial statements on that basis.
Small companies exemption
The report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
We have audited the financial statements of LumiraDx Colombia Holdings Limited (the 'Company') for the year ended 31 December 2023 which comprise the income statement, the statement of financial position, the statement of changes in equity, the statement of cash flows 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 UK adopted international accounting standards.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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.
Other information
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is 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 director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the director's report has been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the director's report.
We have nothing to report in respect of the following matters where 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 director's remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
The Directors were not entitled to take advantage of the small companies’ exemptions in preparing the Directors’ Report and from the requirement to prepare a Strategic Report.
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
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.
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.
Extent to which the audit is considered capable of detecting irregularities, including fraud (cont.)
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:
Companies Act 2006;
UK tax legislation; and
UK-adopted international accounting standards.
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.
We assessed the susceptibility of the 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:
Management override of controls
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 any 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;
Performing audit 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;
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.
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.
The income statement has been prepared on the basis that all operations are continuing operations.
There are no other gains or losses, other than these shown above, hence no statement of other comprehensive income or expenditure is presented.
LumiraDx Colombia Holdings Limited (the 'Company') is a private company limited by shares incorporated and domiciled in England and Wales. The registered office is 27 Old Gloucester Street, London, WC1N 3AX.
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed annually to determine if there is any indication that any of the investments might be impaired and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the Company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
The Company recognises financial debt when the Company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'financial liabilities held at amortised cost'. The Company has no financial liabilities at fair value through profit or loss at the reporting date.
Financial liabilities held at amortised cost, including borrowings, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.
Financial liabilities are derecognised when, and only when, the Company’s obligations are discharged, cancelled, or they expire.
Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the Company.
The tax expense represents the sum of the tax currently payable and deferred tax.
The company has adopted all the standards and amendments to existing standards which are mandatory for accounting periods beginning on 1 January 2023, in particular:
- Amendments to IAS 1 and IFRS Practice Statement 2 requiring that an entity discloses its material accounting policies, instead of its significant accounting policies.
There are no amendments to accounting standards or IFRS interpretations that are effective for the year ended 31 December 2023 that have had a material impact on the financial statements. Furthermore, there are no amendments to accounting standards or IFRS interpretations for periods commencing 1 January 2024 that the directors of the company expect to have a material impact on the financial statements.
In the application of the Company’s accounting policies, the director is 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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
The recognition of any deferred tax asset in respect of tax losses is a judgement exercised by management. This judgement is based on a review at each reporting over the probability that sufficient taxable profits will be available to allow all or part of the asset to be recovered. At the reporting date, it is the judgement of management that no deferred tax asset should be recognised.
Audit fees of £12,500 (2022: £6,500) have been borne by a fellow group undertaking.
The average monthly number of persons (including directors) employed by the Company during the year was:
The cost of remunerating directors is borne by another Group entity. The Company’s share of the directors’ cost based on time spent on this entity by the directors is considered to be immaterial. The directors are also regarded as key management and thus key management remuneration paid in the current and comparative period would also be regarded as immaterial. The directors are party to the liability insurance policies maintained by the Group.
The charge for the year can be reconciled to the loss per the income statement as follows:
The Company has estimated losses of $1,205,862 (2022: $1,043,894) that are available for offset against future taxable profits of the Company.
A change in the future UK Corporation tax rate to 25% with effect from 1 April 2023 was announced in the March 2021 budget and substantively enacted on 24 May 2021.
Details of the Company's subsidiaries at 31 December 2023 are as follows:
Loans from fellow group undertakings are unsecured and relate to a loan of $5,596,753 (2022: $5,596,753) and accrued interest of $1,008,069 (2022: $846,101) at 3% per annum. Loan notes fall due for repayment on 31 October 2024. Interest attached to the loan notes is repayable on demand.
An analysis of the carrying value of the Company's financial liabilities is as follows:
The Director considers that the carrying amounts of financial liabilities carried at amortised cost in the financial statements approximate their fair values.
Further aging analysis of the Company's financial liabilities is outlined at note 10.
The following table details the changes in the Company's liabilities arising from financing activities.
The Company’s capital management objectives are to provide an adequate return to shareholders through the operation of the Company's subsidiary undertaking.
The capital structure of the Company consists of equity (comprising issued capital and any accumulated profits). The Company is not subject to any externally imposed capital requirements.
The Company actively and regularly reviews and manages its capital structure to ensure an optimal capital structure and to maximise equity holder returns, taking into consideration the future capital requirements of the Company and capital efficiency, projected capital expenditures, prevailing and projected profitability of the Company and its subsidiary, projected cash flows, and projected strategic investment and development opportunities.
Management regards capital as total equity and any accumulated profits for capital management purposes. At the reporting date, this was £1 (2022 - £1).
Financial risks management
Due to the nature of the Company’s operations, financial risks is principally in the form of liquidity risk. The Company manages these risks through an effective risk management programme which is coordinated by the Director.
Liquidity risk
Liquidity risk refers to the Company being unable to settle its obligations as these fall due.
The Company closely monitors its continued access to funding facilities provided through the issue of loan notes to fellow group undertakings in comparison to its outstanding commitments on a regular basis to ensure that it has sufficient funds to meet these obligations.
The Director regularly reviews debt management forecasts which estimate the cash inflows and outflows for the next twelve months, so that management can ensure that sufficient funding is in place as it is required.
Retained earnings represent accumulated comprehensive income/(expenditure) for the year and prior periods less dividends paid.
The Company has an outstanding loan of $5,596,753 from its parent company LumiraDx International Limited. The loan maturity date is October 2024. Total interest accrued on the loan amounts to $1,008,069 (2022: $846,101) at 3% per annum. Interest of $161,968 (2022: $161,969) accrued on this loan during the period and is repayable on demand.
At 31 December 2023 the Company is holding investments of $5,398,961 in Lumira SAS (Columbia).