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Company No: 11046787 (England and Wales)

PURPLE TAMBOURINE LIMITED

Unaudited Financial Statements
For the financial year ended 29 February 2024
Pages for filing with the registrar

PURPLE TAMBOURINE LIMITED

Unaudited Financial Statements

For the financial year ended 29 February 2024

Contents

PURPLE TAMBOURINE LIMITED

STATEMENT OF FINANCIAL POSITION

As at 29 February 2024
PURPLE TAMBOURINE LIMITED

STATEMENT OF FINANCIAL POSITION (continued)

As at 29 February 2024
Note 2024 2023
£ £
Fixed assets
Intangible assets 3 802 4,689
Tangible assets 4 10,313 12,617
11,115 17,306
Current assets
Stocks 618 645
Debtors 5 20,851 7,855
Cash at bank and in hand 35,958 39,229
57,427 47,729
Creditors: amounts falling due within one year 6 ( 164,497) ( 131,686)
Net current liabilities (107,070) (83,957)
Total assets less current liabilities (95,955) (66,651)
Creditors: amounts falling due after more than one year 7 ( 8,709) ( 6,100)
Net liabilities ( 104,664) ( 72,751)
Capital and reserves
Called-up share capital 8 13 13
Share premium account 258,823 258,823
Other reserves 9 212,943 212,943
Profit and loss account ( 576,443 ) ( 544,530 )
Total shareholders' deficit ( 104,664) ( 72,751)

For the financial year ending 29 February 2024 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Director's responsibilities:

The financial statements of Purple Tambourine Limited (registered number: 11046787) were approved and authorised for issue by the Director. They were signed on its behalf by:

N Martin
Director

23 October 2024

PURPLE TAMBOURINE LIMITED

NOTES TO THE FINANCIAL STATEMENTS

For the financial year ended 29 February 2024
PURPLE TAMBOURINE LIMITED

NOTES TO THE FINANCIAL STATEMENTS

For the financial year ended 29 February 2024
1. Accounting policies

The principal accounting policies are summarised below. They have all been applied consistently throughout the financial year and to the preceding financial year, unless otherwise stated.

General information and basis of accounting

Purple Tambourine Limited (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is 12 Kingsley Place, London, N6 5EA, United Kingdom. The principal activity of the Company is that of the development and sale of augmented reality controllers with corresponding software development kits.

The financial statements have been prepared under the historical cost convention, modified to include certain items at fair value, and in accordance with Section 1A of Financial Reporting Standard 102 (FRS 102) ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ issued by the Financial Reporting Council and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime.

The financial statements are presented in pounds sterling which is the functional currency of the Company and rounded to the nearest £.

Going concern

The director has assessed the Statement of Financial Position and likely future cash flows at the date of approving these financial statements. The director has a reasonable expectation that the company has adequate resources to continue in operational existence and to meet its financial obligations as they fall due for at least 12 months from the date of signing these financial statements. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Foreign currency

Transactions in foreign currencies are recorded at the rate of exchange at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the Statement of Financial Position date are reported at the rates of exchange prevailing at that date.

Exchange differences are recognised in the Statement of Comprehensive Income in the period in which they arise except for exchange differences arising on gains or losses on non-monetary items which are recognised in the Statement of Comprehensive Income.

Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Turnover is recognised when the significant risks and rewards are considered to have been transferred to the customer.

Interest income

Interest income is recognised when it is probable that the economic benefits will flow to the company and the amount of revenue can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount on initial recognition.

Finance costs

Finance costs are charged to the Statement of Comprehensive Income over the term of the debt using the effective interest method so the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Taxation

Current tax
Current tax is provided at amounts expected to be paid (or recoverable) using the tax rates and laws that have been enacted or substantively enacted at the Statement of Financial Position date.

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years.

If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

Intangible assets

Intangible assets are stated at cost or valuation, net of amortisation and any provision for impairment. Amortisation is provided on all intangible assets at rates to write off the cost or valuation of each asset over its expected useful life as follows:

Other intangible assets not amortised
Tangible fixed assets

Tangible fixed assets are stated at cost or valuation, net of depreciation and any provision for impairment. Depreciation is provided on all tangible fixed assets, other than investment property and freehold land, at rates calculated to write off the cost or valuation, less estimated residual value, of each asset on a straight-line or reducing balance basis over its expected useful life, as follows:

Fixtures and fittings 25 % reducing balance
Office equipment 25 % reducing balance
Computer equipment 25 % reducing balance

Residual value represents the estimated amount which would currently be obtained from disposal of an asset, after deducting estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Borrowing costs

Borrowing costs that are directly attributable to acquisition, construction or production of qualifying assets, are capitalised as part of the cost of those assets. Capitalisation begins when both finance costs and expenditures for the asset are being incurred and activities that are necessary to get the asset ready for use are in progress. Capitalisation ceases when substantially all the activities that are necessary to get the asset ready for use are complete.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

Leases

The company as lessee
Assets held under finance leases, hire purchase contracts and other similar arrangements, which confer rights and obligations similar to those attached to owned assets, are capitalised as tangible fixed assets at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities, while the interest elements are charged to the Statement of Comprehensive Income over the period of the leases to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to sell, which is equivalent to the net realisable value. Cost includes materials, direct labour and an attributable proportion of manufacturing overheads based on normal levels of activity. Cost is calculated using the FIFO (first-in, first-out) method. Provision is made for obsolete, slow-moving or defective items where appropriate.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks 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 profit or loss.

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 creditors: amounts falling due within one year.

Financial instruments

The Company only enters into basic financial instruments and transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to and from related parties and investments in non-puttable ordinary shares.

Financial assets
Basic financial assets, including trade and other debtors, and amounts due from related companies, are initially recognised at transaction price, 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.

Such assets are subsequently carried at amortised cost using the effective interest method.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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 Comprehensive Income.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

Financial liabilities
Basic financial liabilities, including trade and other creditors and accruals, 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 receipts discounted at a market rate of interest.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade 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 using the effective interest method.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

Financial assets and liabilities are offset and 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.

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating either to revenue or to assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

Pensions

Defined contribution pension plan:

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognized as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.

Convertible debt

The proceeds received on issue of the Company's convertible debt are allocated into their liability and equity components and presented separately in the Statement of financial position.

The amount initially attributed to the debt component equals the discounted cash flows using a market rate of interest that would be payable on a similar debt instrument that did not include an option to convert.

The difference between the net proceeds of the convertible debt and the amount allocated to the debt component is credited direct to equity and is not subsequently remeasured. On conversion, the debt and equity elements are credited to share capital and share premium as appropriate.

Transaction costs that relate to the issue of the instrument are allocated to the liability and equity components of the instrument in proportion to the allocation of proceeds.

2. Employees

2024 2023
Number Number
Monthly average number of persons employed by the company during the year, including the director 1 3

3. Intangible assets

Other intangible assets Total
£ £
Cost
At 01 March 2023 4,689 4,689
Disposals ( 473) ( 473)
At 29 February 2024 802 802
Accumulated amortisation
At 01 March 2023 0 0
At 29 February 2024 0 0
Net book value
At 29 February 2024 802 802
At 28 February 2023 4,689 4,689

4. Tangible assets

Fixtures and fittings Office equipment Computer equipment Total
£ £ £ £
Cost
At 01 March 2023 4,202 5,721 15,883 25,806
Additions 0 269 998 1,267
Disposals 0 0 ( 472) ( 472)
At 29 February 2024 4,202 5,990 16,409 26,601
Accumulated depreciation
At 01 March 2023 3,149 3,584 6,456 13,189
Charge for the financial year 263 581 2,380 3,224
Disposals 0 0 ( 139) ( 139)
At 29 February 2024 3,412 4,165 8,711 16,288
Net book value
At 29 February 2024 790 1,825 7,698 10,313
At 28 February 2023 1,053 2,137 9,427 12,617

5. Debtors

2024 2023
£ £
Other debtors 20,851 7,855

6. Creditors: amounts falling due within one year

2024 2023
£ £
Bank loans 1,659 4,441
Trade creditors 15,156 0
Other loans 124,309 124,309
Accruals 2,000 2,300
Taxation and social security 21,373 0
Other creditors 0 636
164,497 131,686

The other loans balance comprises of several convertible loans which will convert on completion of the next qualifying financing round.

7. Creditors: amounts falling due after more than one year

2024 2023
£ £
Bank loans 8,709 6,100

8. Called-up share capital

2024 2023
£ £
Allotted, called-up and fully-paid
13,026 Share capital ordinary shares of £ 0.001 each 13 13

9. Reserves

Other reserves

Other reserves represents amounts received as advance subscription for shares totalling £34,647, amounts received for simple agreements for future equity totalling £169,124 and shares to be issued of £9,172 in relation to convertible loans.