Company registration number 11388322 (England and Wales)
VIDYA GLOBAL LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
VIDYA GLOBAL LIMITED
COMPANY INFORMATION
Directors
C Kodimule
S P Kodimule
Vidya Europe
Secretary
O Krsmanovic
Company number
11388322
Registered office
First Floor
5 Fleet Place
London
EC4M 7RD
Auditor
BKL Audit LLP
Chartered Accountants
5 Fleet Place
London
EC4M 7RD
VIDYA GLOBAL LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Statement of financial position
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 21
VIDYA GLOBAL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
A summary of the results of the year's trading is given on page 6 of the financial statements.
The directors consider the key performance indicators to be revenue, along with the related operating expenses, which are as follows:
Key performance indicators
2023
2022
2021
as restated
as restated
$
$
$
Revenue
30,859,625
37,947,951
20,529,261
Cost of sales
29,043,730
35,168,598
20,051,594
Administrative expenses
1,849,645
1,775,836
2,245,716
Principal risks and uncertainties
We are exposed to a number of business and financial risks from operating activities. The directors are responsible for ensuring that the business risks are actively managed. As such the business uses financial instruments (financial derivatives – Commodity futures) for the sole purpose of hedging the company's risks, and in line with this, have implemented hedge accounting at the year end, in order to align the accounting treatment of these financial instruments with the company’s risk management practices.
The key financial risks are identified below:
Market risk – In regards to market risk, we manage it by offering a wide portfolio of origins, minimising the exposure to one supply base.
Currency risk – A large portion of transactions are conducted in foreign currencies, but as we aim to both buy and sell in the same currency, we minimise our exposure to currency risk. Further to that if we have a disparity between the purchase and sale currency, we hedge our FX risk at the time of contracting the business to minimise these risks.
Credit risk – We tend to limit the amount of credit we offer to our clients. Further to that we only offer credit to long-term established customers for a limited tenure and to big multi-nationals where we use third party discounting facilities that offer us non-recourse facilities.
Liquidity (cash flow) risk – The company manages its cash flow to ensure it can meet its obligations and requirements as they fall due.
Price risk – Our main field of business is commodity trading, and as such we eliminate our price risk by hedging 100% of the physical business.
C Kodimule
Director
7 October 2024
VIDYA GLOBAL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
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 wholesale trade of coffee and herbal extracts.
Branches
The company operates an overseas branch in Ethiopia and during the year, set up a further branch in Vietnam.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid during the year. 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:
C Kodimule
S P Kodimule
Vidya Europe
Auditor
Wilson Wright LLP acted as auditor of the company up until 2 April 2024. On 2 April 2024, Wilson Wright LLP transferred its audit business to BKL Audit LLP. The members subsequently consented to the appointment of BKL Audit LLP as auditor to the company. The auditor BKL Audit LLP will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the 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 of 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.
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.
VIDYA GLOBAL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
C Kodimule
Director
7 October 2024
VIDYA GLOBAL LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF VIDYA GLOBAL LIMITED
- 4 -
Opinion
We have audited the financial statements of Vidya Global Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, 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 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).
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's 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.
VIDYA GLOBAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF VIDYA GLOBAL LIMITED
- 5 -
Matters on which we are required to report by exception
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 strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, 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, 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's 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Capability of the audit in detecting irregularities, including fraud:
Based on our understanding of the company and the industry, we identified that the principal risks of non-compliance with laws and regulations related to the failure to comply with tax regulations and anti-bribery and anti-corruption laws, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), determined that the principal risks were related to posting inappropriate journal entries and the adoption of hedge accounting. Audit procedures performed by the auditors included:
- Discussions with key management personnel, including consideration of known or suspected instances of non-compliance with laws and regulations;
- Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations;
- Identifying and testing manual journal entries, in particular any journal entries posted with unclear rationale;
- Substantively testing the cut-off in respect of revenue, stock and purchases at the year-end.
- Ensuring the criteria to apply hedge accounting has been met, and that it has been correctly accounted for.
There are inherent limitations in the audit procedures described above, and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
VIDYA GLOBAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF VIDYA GLOBAL LIMITED
- 6 -
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.
Nikki Crane FCA
Senior Statutory Auditor
For and on behalf of BKL Audit LLP
14 October 2024
Chartered Accountants and Statutory Auditor
5 Fleet Place
London
EC4M 7RD
VIDYA GLOBAL LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
as restated
Notes
$
$
Revenue
5
30,859,625
37,947,951
Cost of sales
(29,043,730)
(35,168,598)
Gross profit
1,815,895
2,779,353
Administrative expenses
(1,849,645)
(1,775,836)
Operating (loss)/profit
6
(33,750)
1,003,517
Investment income
8
88,180
2,753
Finance costs
9
(178,509)
(93,169)
Other gains and losses
20
750,000
-
Profit before taxation
625,921
913,101
Tax on profit
11
Profit for the financial year
625,921
913,101
The income statement has been prepared on the basis that all operations are continuing operations.
VIDYA GLOBAL LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
as restated
Notes
$
$
$
$
Non-current assets
Property, plant and equipment
12
22,670
23,845
Current assets
Inventories
14
6,986,879
4,476,802
Trade and other receivables
15
5,871,907
3,189,021
Investments
16
2,072,753
185,749
Cash and cash equivalents
1,493,551
1,764,608
16,425,090
9,616,180
Current liabilities
17
(13,057,899)
(6,876,085)
Net current assets
3,367,191
2,740,095
Net assets
3,389,861
2,763,940
Equity
Called up share capital
19
1,568,921
1,568,921
Retained earnings
1,820,940
1,195,019
Total equity
3,389,861
2,763,940
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 7 October 2024 and are signed on its behalf by:
C Kodimule
Director
Company registration number 11388322 (England and Wales)
VIDYA GLOBAL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
Share capital
Retained earnings
Total
$
$
$
As restated for the period ended 31 December 2022:
Balance at 1 January 2022
1,568,921
281,918
1,850,839
Year ended 31 December 2022:
Profit and total comprehensive income
-
913,101
913,101
Balance at 31 December 2022
1,568,921
1,195,019
2,763,940
Year ended 31 December 2023:
Profit and total comprehensive income
-
625,921
625,921
Balance at 31 December 2023
1,568,921
1,820,940
3,389,861
VIDYA GLOBAL LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
2023
2022
as restated
Notes
$
$
$
$
Cash flows from operating activities
Cash generated from/(absorbed by) operations
23
1,786,687
(214,616)
Investing activities
Purchase of property, plant and equipment
(6,037)
(6,201)
Net investment in contracts
(1,864,292)
949,933
Interest received
88,180
2,753
Net cash (used in)/generated from investing activities
(1,782,149)
946,485
Financing activities
Interest paid
(178,509)
(93,169)
Net cash used in financing activities
(178,509)
(93,169)
Net (decrease)/increase in cash and cash equivalents
(173,971)
638,700
Cash and cash equivalents at beginning of year
1,764,608
1,028,079
Effect of foreign exchange rates
(97,086)
97,829
Cash and cash equivalents at end of year
1,493,551
1,764,608
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information
Vidya Global Limited is a private company limited by shares incorporated in England and Wales. The registered office is First Floor, 5 Fleet Place, London, EC4M 7RD.
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 dollar, 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.
1.2
Going concern
At 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. On this basis the directors consider it appropriate to continue to adopt the going concern basis of accounting in preparing these financial statements.true
1.3
Revenue
Revenue is recognised at the fair value of the consideration received or receivable from the supply of coffee and herbal extracts during the year, and is shown net of VAT.
Revenue is recognised when the risks and rewards of ownership are passed to the customer.
1.4
Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
25% reducing balance
Fixtures and fittings
25% reducing balance
Computers
25% straight line
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 the statement of income.
1.5
Inventories
Inventories of herbal extracts are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those costs that have been incurred in bringing the inventories to their present location and condition.
As a result of the implementation of hedge accounting at the year end, inventories of coffee are stated at fair value, in accordance with Section 12 of FRS 102, to include the fair value gain or loss on the hedged item.
Goods in transit are included as inventory as soon as the coffee crosses over the ship's rail, as this is the point at which the risks and rewards of ownership are passed to the company.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of inventories over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in the income statement.
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 statement of financial position 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 trade and other receivables 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.
Impairment of financial assets
Financial assets, other than those held at fair value through the statement of income, 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 the statement of income.
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 the statement of 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 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.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Basic financial liabilities
Basic financial liabilities, including trade and other payables, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 payables 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 payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate.
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
Derivatives
Derivatives, such as coffee futures contracts, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently re-measured at their fair value and the changes in fair value are recognised in profit or loss.
1.10
Hedge accounting
The company designates certain hedging instruments, including derivatives, embedded derivatives and non-derivatives, as fair value hedges. At the inception of the hedge relationship, the company documents the relationship between the hedging instrument and the hedged item along with risk management objectives and strategies for undertaking various hedge transactions. At the inception of the hedge and on an ongoing basis, the company documents whether the hedging instrument is highly effective in offsetting changes in fair values of the hedged item.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
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.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
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.
1.14
Foreign exchange
Transactions in currencies other than dollar 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.
2
Change in accounting policy
During the current financial year, the company met the criteria required to adopt hedge accounting, and at the year end elected to implement hedge accounting in the financial statements, as permitted under FRS 102 Section 12. This decision has been made to align the accounting treatment of certain financial instruments with the company’s risk management practices, particularly in mitigating the exposure to fluctuations in coffee prices. The adoption is intended to reduce volatility in the financial statements and provide a clearer representation of the economic impacts of the company's hedging activities.
The company has applied hedge accounting prospectively at the year end, with no retrospective adjustments made to prior periods, as the company did not meet the required criteria.
3
Prior period adjustment
A prior year adjustment has been made to reclassify $833,448 of current asset investments to cash and cash equivalents on the balance sheet, to accurately reflect the substance of the balance.
Additionally, gains on futures contracts of $16,440 have been reclassified from administrative expenses, as they relate to gains on financial instruments used to hedge against price risk (of coffee) and therefore should be included within cost of sales.
4
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.
There are no material areas of judgement or estimation uncertainty in these financial statements.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
5
Revenue
2023
2022
$
$
Revenue analysed by geographical market
United Kingdom
853,756
785,525
Europe
18,970,199
20,863,782
Rest of World
11,035,670
16,298,644
30,859,625
37,947,951
All revenue is derived from the sale of goods.
6
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging/(crediting):
$
$
Exchange (gains)/losses
(242,966)
144,325
Fees payable to the company's auditor for the audit of the company's financial statements
33,458
34,642
Depreciation of owned property, plant and equipment
7,212
9,187
(Gains)/losses on financial instruments measured at fair value through profit or loss
(594,645)
(16,441)
Operating lease charges
68,325
80,451
7
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Sales
2
2
Admin
1
1
Management
2
1
Logistics
1
1
Finance
1
1
Total
7
6
The comparative number has been adjusted to exclude those directors who are not employed under contracts of service.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Employees
(Continued)
- 16 -
Their aggregate remuneration comprised:
2023
2022
$
$
Wages and salaries
704,759
534,060
Social security costs
72,921
69,519
Pension costs
14,076
12,416
791,756
615,995
8
Investment income
2023
2022
$
$
Interest income
Interest on bank deposits
88,180
2,753
9
Finance costs
2023
2022
$
$
Other finance costs:
Other interest
178,509
93,169
10
Other gains and losses
2023
2022
$
$
Debt waiver (note 21)
750,000
-
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
11
Taxation
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
$
$
Profit before taxation
625,921
913,101
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
156,480
173,489
Tax effect of expenses that are not deductible in determining taxable profit
6,157
5,643
Tax effect of income not taxable in determining taxable profit
(187,500)
Utilisation of tax losses
(179,399)
Unutilised tax losses carried forward
26,023
Effect of change in corporation tax rate
(1,454)
Permanent capital allowances in excess of depreciation
294
267
Taxation charge for the year
-
-
From 1 April 2023, the main rate of corporation tax in the UK changed from 19% to 25%.
The company has $1,294,149 (2022: $1,196,000 ) of losses available for carry forward against future taxable profits.
12
Property, plant and equipment
Plant and equipment
Fixtures and fittings
Computers
Total
$
$
$
$
Cost
At 1 January 2023
19,321
8,376
24,360
52,057
Additions
6,037
6,037
At 31 December 2023
19,321
8,376
30,397
58,094
Depreciation and impairment
At 1 January 2023
9,387
4,514
14,311
28,212
Depreciation charged in the year
2,588
966
3,658
7,212
At 31 December 2023
11,975
5,480
17,969
35,424
Carrying amount
At 31 December 2023
7,346
2,896
12,428
22,670
At 31 December 2022
9,934
3,862
10,049
23,845
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
13
Financial instruments
Carrying amount of financial assets
Instruments measured at fair value through profit or loss
2,072,753
185,749
Fair value gain on hedged firm commitments
1,195,580
-
Carrying amount of financial liabilities
Derivative financial instruments designated in an effective hedging relationship
(1,218,292)
-
The company enters into futures commodity contracts (derivatives) to mitigate the price risk on physical coffee contracts that are entered into for a future point in time. The fair value of the derivative financial liability at the balance sheet date was $1,218,292. As hedge accounting was only applied at the year end, the corresponding amount has been recognised within profit and loss.
The derivatives are measured at fair value, which is determined using valuation techniques that utilise observable inputs.
The amount recognised in profit and loss in respect of the change in fair value of the hedged item (the physical coffee contract) was a gain of $1,900,580.
14
Inventories
2023
2022
$
$
Finished goods and goods for resale
6,986,879
4,476,802
15
Trade and other receivables
2023
2022
$
$
Amounts falling due within one year:
Trade receivables
4,654,987
3,168,567
Fair value gain on hedged firm commitments (note 13)
1,195,580
-
Other receivables
7,017
71
Prepayments and accrued income
14,323
20,383
5,871,907
3,189,021
16
Current asset investments
2023
2022
$
$
Other investments (note 13)
2,072,753
185,749
Current asset investments are derivatives held at fair value through profit and loss. The fair value is determined using valuation techniques that utilise observable inputs.
At 31 December 2022 and 31 December 2023, the balance represented the funds held as security to cover unrealised losses on investments. The unrealised loss at the reporting date is presented within current liabilities.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
17
Current liabilities
2023
2022
$
$
Credit facility
1,674,922
Trade payables
9,297,607
5,997,382
Taxation and social security
68,166
71,414
Other payables
1,971,820
752,284
Accruals and deferred income
45,384
55,005
13,057,899
6,876,085
The credit facility is secured by way of the following:
A debenture comprising fixed and floating charges over all the assets and undertakings of the company, and a general pledge over documents, goods and contract monies from the company.
A group guarantee in favour of the bank from Vidya Global Limited and Vidya Europe guaranteeing the obligations of each other to the bank.
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
$
$
Charge to profit or loss in respect of defined contribution schemes
14,076
12,416
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.
19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
$
$
Issued and fully paid
Ordinary shares of $1 each
1,220,000
1,220,000
1,568,921
1,568,921
20
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
52,616
44,104
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
21
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2023
2022
$
$
Aggregate compensation
179,399
197,728
Other information
The company has adopted the exemption permitted by paragraph 33.1A of FRS 102 and has not disclosed transactions with other group members, which are wholly owned subsidiaries.
The following transactions and balances occurred with other related parties:
2023
2022
$
$
Sales to companies under common control
1,332,833
5,561,558
Purchases from companies under common control
15,131,777
20,577,478
Amounts owed to companies under common control
7,383,071
4,076,784
In addition to the above, a company under a common control agree to waive debt of $750,000 (2022 - $nil) owed to it by Vidya Global Limited. There are no conditions imposed on the waiver and the credit has been included within other gains and losses in the statement of comprehensive income.
22
Ultimate controlling party
The immediate and ultimate parent undertaking is Vidya Europe.
The ultimate controlling party is S P Kodimule.
VIDYA GLOBAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
23
Cash generated from/(absorbed by) operations
2023
2022
$
$
Profit for the year after tax
625,921
913,101
Adjustments for:
Finance costs
178,509
93,169
Investment income
(88,180)
(2,753)
Depreciation and impairment of property, plant and equipment
7,212
9,187
Foreign exchange gains on cash equivalents
97,086
(97,829)
Movements in working capital:
Increase in inventories
(2,510,077)
(1,253,368)
Increase in trade and other receivables
(1,487,306)
(1,498,390)
Increase in trade and other payables
4,963,522
1,622,267
Cash generated from/(absorbed by) operations
1,786,687
(214,616)
24
Analysis of changes in net funds/(debt)
1 January 2023
Cash flows
Exchange rate movements
31 December 2023
$
$
$
$
Cash and cash equivalents
1,764,608
(173,971)
(97,086)
1,493,551
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