Caseware UK (AP4) 2023.0.135 2023.0.135 2023-10-312023-10-31truetruetruetruetrue282022-11-01falseProvision of software2truefalsefalse 08845310 2022-11-01 2023-10-31 08845310 2021-11-01 2022-10-31 08845310 2023-10-31 08845310 2022-10-31 08845310 2021-11-01 08845310 c:Director2 2022-11-01 2023-10-31 08845310 c:Director2 2023-10-31 08845310 c:Director3 2022-11-01 2023-10-31 08845310 c:Director3 2023-10-31 08845310 c:Director4 2022-11-01 2023-10-31 08845310 c:Director4 2023-10-31 08845310 c:RegisteredOffice 2022-11-01 2023-10-31 08845310 d:Buildings d:ShortLeaseholdAssets 2022-11-01 2023-10-31 08845310 d:Buildings d:ShortLeaseholdAssets 2023-10-31 08845310 d:Buildings d:ShortLeaseholdAssets 2022-10-31 08845310 d:Buildings d:ShortLeaseholdAssets d:BottomRangeValue 2022-11-01 2023-10-31 08845310 d:FurnitureFittings 2022-11-01 2023-10-31 08845310 d:FurnitureFittings 2023-10-31 08845310 d:FurnitureFittings 2022-10-31 08845310 d:FurnitureFittings d:OwnedOrFreeholdAssets 2022-11-01 2023-10-31 08845310 d:FurnitureFittings d:BottomRangeValue 2022-11-01 2023-10-31 08845310 d:ComputerEquipment 2022-11-01 2023-10-31 08845310 d:ComputerEquipment 2023-10-31 08845310 d:ComputerEquipment 2022-10-31 08845310 d:ComputerEquipment d:OwnedOrFreeholdAssets 2022-11-01 2023-10-31 08845310 d:ComputerEquipment d:BottomRangeValue 2022-11-01 2023-10-31 08845310 d:ComputerEquipment d:TopRangeValue 2022-11-01 2023-10-31 08845310 d:OwnedOrFreeholdAssets 2022-11-01 2023-10-31 08845310 d:CurrentFinancialInstruments 2023-10-31 08845310 d:CurrentFinancialInstruments 2022-10-31 08845310 d:Non-currentFinancialInstruments 2023-10-31 08845310 d:Non-currentFinancialInstruments 2022-10-31 08845310 d:CurrentFinancialInstruments d:WithinOneYear 2023-10-31 08845310 d:CurrentFinancialInstruments d:WithinOneYear 2022-10-31 08845310 d:Non-currentFinancialInstruments d:AfterOneYear 2023-10-31 08845310 d:Non-currentFinancialInstruments d:AfterOneYear 2022-10-31 08845310 d:ReportableOperatingSegment1 2022-11-01 2023-10-31 08845310 d:ReportableOperatingSegment1 2021-11-01 2022-10-31 08845310 e:UnitedKingdom 2022-11-01 2023-10-31 08845310 e:UnitedKingdom 2021-11-01 2022-10-31 08845310 e:RestEuropeOutsideUK 2022-11-01 2023-10-31 08845310 e:RestEuropeOutsideUK 2021-11-01 2022-10-31 08845310 e:RestWorldOutsideUK 2022-11-01 2023-10-31 08845310 e:RestWorldOutsideUK 2021-11-01 2022-10-31 08845310 d:UKTax 2022-11-01 2023-10-31 08845310 d:UKTax 2021-11-01 2022-10-31 08845310 d:ShareCapital 2022-11-01 2023-10-31 08845310 d:ShareCapital 2023-10-31 08845310 d:ShareCapital 2021-11-01 2022-10-31 08845310 d:ShareCapital 2022-10-31 08845310 d:ShareCapital 2021-11-01 08845310 d:RetainedEarningsAccumulatedLosses 2022-11-01 2023-10-31 08845310 d:RetainedEarningsAccumulatedLosses 2023-10-31 08845310 d:RetainedEarningsAccumulatedLosses 2021-11-01 2022-10-31 08845310 d:RetainedEarningsAccumulatedLosses 2022-10-31 08845310 d:RetainedEarningsAccumulatedLosses 2021-11-01 08845310 c:OrdinaryShareClass1 2022-11-01 2023-10-31 08845310 c:OrdinaryShareClass1 2023-10-31 08845310 c:OrdinaryShareClass1 2022-10-31 08845310 c:FRS102 2022-11-01 2023-10-31 08845310 c:Audited 2022-11-01 2023-10-31 08845310 c:FullAccounts 2022-11-01 2023-10-31 08845310 c:PrivateLimitedCompanyLtd 2022-11-01 2023-10-31 08845310 d:Subsidiary1 2022-11-01 2023-10-31 08845310 d:Subsidiary1 1 2022-11-01 2023-10-31 08845310 6 2022-11-01 2023-10-31 08845310 d:AcceleratedTaxDepreciationDeferredTax 2023-10-31 08845310 d:AcceleratedTaxDepreciationDeferredTax 2022-10-31 08845310 d:OtherDeferredTax 2023-10-31 08845310 d:OtherDeferredTax 2022-10-31 08845310 f:PoundSterling 2022-11-01 2023-10-31 xbrli:shares iso4217:GBP xbrli:pure

Registered number: 08845310









ZERTO UK LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 OCTOBER 2023

 
ZERTO UK LIMITED
 
 
COMPANY INFORMATION


Directors
M P Harris 
S A Marston 




Registered number
08845310



Registered office
Ground Floor
210 Wharfedale Road

Winnersh

Wokingham

RG41 5TP




Independent auditor
Nortons Assurance Limited
Chartered Accountants and Statutory Auditor

Second Floor

NOW Building

Thames Valley Park

Reading

Berkshire

RG6 1RB





 
ZERTO UK LIMITED
 

CONTENTS



Page
Strategic Report
1 - 2
Directors' Report
3 - 4
Independent Auditor's Report
5 - 8
Profit and Loss Account
9
Balance Sheet
10
Statement of Changes in Equity
11
Notes to the Financial Statements
12 - 24


 
ZERTO UK LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023

Introduction
 
The Directors present their strategic report with the report of the Directors and financial statements of the Company for the year ended 31 October 2023.

Business review
 
The results for the year ended 31 October 2023 are set out in the Profit and Loss Account. Following the acquisition by Hewlett Packard Enterprise in 2021, the Company shortened its year end to align with that of the group.
The Company provides a leading software platform that converges disaster recovery, backup and data protection, and cloud mobility. Our IT Resilience Platform enables enterprises to accelerate their digital transformation, reduce downtime and data loss, and move workloads seamlessly across public, private, and multi-cloud environments. The core of our solution is our proprietary journal-based technology, which enables continuous protection and mobility of business applications and data.
The profit for the current period to 31 October 2023 is £467,177. The directors are confident that the business is moving forward and has a promising future. Investments are being made to expand the Company's local market customer base and to sell additional software products and services to its current customers. 
The Company's total turnover increased 1.4% to £18,257,969 in the current period.
                                                         
2023  2022
        £  £
Net current assets      4,450,788 4,511,240
Net assets       2,811,610 2,344,433
Turnover       18,257,969 18,012,137
Profit on ordinary activities before taxation  586,358 540,555
Profit after taxation      467,177 429,240

The Company has a good cash position at the year-end due to the timely collection of trade debts from its customers.
In a Company this size, the directors consider various non-financial performance indicators but none individually are key. The Company continues to enjoy a high rate of customer retention that should continue to provide recurring revenues to the business over the coming years.
On 31 August 2021, Hewlett Packard Enterprise (NYSE: HPE) completed the acquisition of Zerto Ltd (the parent company), with a net cash purchase price at closing of USD 374 million. On 1 February 2022 all employees of the Company were transferred to Hewlett-Packard Limited but the entity will continue to trade under agreements with group companies.
Due to the Company's cash position, high customer retention rate, acquisition by Hewlett Packard Enterprise and availability of a variety of funding sources, the directors believe that it remains appropriate to prepare the financial statements on a going concern basis.


Page 1

 
ZERTO UK LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023

Principal risks and uncertainties
 
The management of the business and the execution of the Company's strategy are subject to a number of risks. The key business risks are set out below:

Because we derive substantially all of our revenues from sales of our IT Resilience Platform, if the market for IT resilience solutions fails to grow as we expect or if our platform loses or fails to gain market acceptance, our business, operating results, and financial condition could be adversely affected.


This report was approved by the board and signed on its behalf.



S A Marston
Director

Date: 31 October 2024

Page 2

 
ZERTO UK LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023

The directors present their report and the financial statements for the year ended 31 October 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £467,177 (2022 - £429,240).

No dividends will be distributed for the year ended 31 October 2023 (2022 - none).

Directors

The directors who served during the year were:

Z Kedem (resigned 8 November 2022)
M P Harris (appointed 8 November 2022)
S A Marston (appointed 8 November 2022)

Future developments

There are no significant future developments to note.

Matters covered in the Strategic Report

As permitted by Section414c(11) of the Companies Act 2006, the directors have elected to disclose information required to be in the Directors' report by Schedule 7 of the 'Large and Medium sized Companies and Groups Regulations 2008', in the Strategic report and have done so in respect of risks and uncertainties.

Page 3

 
ZERTO UK LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Post balance sheet events

There are no significant post balance sheet events to note.

Auditor

The auditor, Nortons Assurance Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 



S A Marston
Director

Date: 31 October 2024

Page 4

 
ZERTO UK LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZERTO UK LIMITED
 

Opinion


We have audited the financial statements of Zerto UK Limited (the 'Company') for the year ended 31 October 2023, which comprise the Profit and Loss Account, the Balance Sheet, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 October 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.


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'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 United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


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.


Page 5

 
ZERTO UK LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZERTO UK LIMITED (CONTINUED)


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 directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

In our opinion, based on the work undertaken in the course of the 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.


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 directors' 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 set out on page 3, 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.


Page 6

 
ZERTO UK LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZERTO UK LIMITED (CONTINUED)


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.


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:

The objectives of our audit, in respect to fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
Our approach follows:
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant frameworks which are directly relevant to specific assertions in the financial statements are those that relate to the reporting framework including the Companies Act 2006 and the relevant tax compliance regulations in the UK.
We understood how the Company is complying with those frameworks by making enquiries of management and those responsible for legal and compliance procedures. We communicated identified laws and regulations to our team and remained alert for any indications of non-compliance throughout the audit.
We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur by discussing with management to understand where it considered there was a susceptibility to fraud. We considered the controls that the Company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those controls.
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations identified in the paragraphs above. Our procedures involved journal entry testing, with a focus on journals indicating large or unusual transactions based on our understanding of the business, enquiries of Company management and using analytical procedures to identify any unusual or unexpected relationships.
In addition, we completed procedures to conclude on the compliance of the disclosures in the Annual Report
and Accounts with the requirements of the relevant accounting standards and UK legislation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's Report.


Page 7

 
ZERTO UK LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZERTO UK LIMITED (CONTINUED)


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 2006Our 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.





Karen Cairns (Senior Statutory Auditor)
  
for and on behalf of
Nortons Assurance Limited
 
Chartered Accountants and Statutory Auditor
  
Second Floor
NOW Building
Thames Valley Park
Reading
Berkshire
RG6 1RB

31 October 2024
Page 8

 
ZERTO UK LIMITED
 
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 OCTOBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
18,257,969
18,012,137

Administrative expenses
  
(17,719,013)
(17,471,773)

Operating profit
 5 
538,956
540,364

Interest receivable and similar income
 8 
47,402
191

Profit before tax
  
586,358
540,555

Tax on profit
 9 
(119,181)
(111,315)

Profit for the financial year
  
467,177
429,240

There are no items of other comprehensive income for 2023 or 2022 other than the profit for the yearAs a result, no separate Statement of Comprehensive Income has been presented.

The notes on pages 12 to 24 form part of these financial statements.

Page 9

 
ZERTO UK LIMITED
REGISTERED NUMBER: 08845310

BALANCE SHEET
AS AT 31 OCTOBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 10 
3,018
17,894

Investments
 11 
22,018
22,018

  
25,036
39,912

Current assets
  

Debtors: amounts falling due after more than one year
 12 
2,042,939
1,829,316

Debtors: amounts falling due within one year
 12 
8,346,844
6,186,236

Cash at bank and in hand
 13 
3,204,396
4,594,593

  
13,594,179
12,610,145

Creditors: amounts falling due within one year
 14 
(9,143,391)
(8,098,905)

Net current assets
  
 
 
4,450,788
 
 
4,511,240

Total assets less current liabilities
  
4,475,824
4,551,152

Creditors: amounts falling due after more than one year
 15 
(1,664,214)
(2,206,719)

Net assets
  
2,811,610
2,344,433


Capital and reserves
  

Called up share capital 
 17 
1
1

Profit and loss account
 18 
2,811,609
2,344,432

  
2,811,610
2,344,433


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 



S A Marston
Director

Date: 31 October 2024

The notes on pages 12 to 24 form part of these financial statements.

Page 10

 
ZERTO UK LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 November 2021
1
1,915,192
1,915,193


Comprehensive income for the year

Profit for the year
-
429,240
429,240
Total comprehensive income for the year
-
429,240
429,240



At 1 November 2022
1
2,344,432
2,344,433


Comprehensive income for the year

Profit for the year
-
467,177
467,177
Total comprehensive income for the year
-
467,177
467,177


At 31 October 2023
1
2,811,609
2,811,610


The notes on pages 12 to 24 form part of these financial statements.

Page 11

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

1.


General information

Zerto UK Limited (the Company) is a private company limited by shares and incorporated in England. The Company's registered office is Ground Floor, 210 Wharfedale Road, Winnersh, Wokingham, RG41 5TP.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Hewlett Packard Enterprise Company as at 31 October 2023 and these financial statements may be obtained from www.investors.hpe.com/financial.

 
2.3

Exemption from preparing consolidated financial statements

The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of a state other than the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 401 of the Companies Act 2006.

 
2.4

Going concern

The directors have received a guarantee of continued financial support from the Company's parent company thus the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future and continue to adopt the going concern basis of accounting in preparing the annual financial statements. 

Page 12

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

2.Accounting policies (continued)

 
2.5

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP, rounded to the nearest whole GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Profit and Loss Account within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

Page 13

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

2.Accounting policies (continued)

 
2.6

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

The Company generates revenues in the form of software license fees and related maintenance and support services (including support and unspecified upgrades and enhancements when and if they are available). The Company sells its products worldwide to a network of resellers and cloud service providers. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. The Company assesses collectability based on several factors, including collection history.
The operating margin of the Company is fixed at 3% (2022: 3%) in accordance with the transfer pricing arrangement in place with its parent, Zerto Ltd. As such, an adjustment is made to admin expenses in order to maintain this.
Perpetual software license arrangements 
Revenues from distinct perpetual licenses, which represent the right to use the entity's intellectual property, is recognised at a point in time, once the software is made available to the customer. The Company's software is operated by using a license key, which allows the customer to take immediate possession of the software. Therefore, the revenues are recognised once the key code is delivered to the customer.
Revenues from maintenance and support services, including if and when available updates, are recognised over time. These services are considered as stand-ready obligation, and are recognised on a straight-line basis, which the Company considers as the best measurement as to the progression towards performance obligation completion.
Term-based software license arrangements
Term-based software license arrangements are arrangements consisting of a bundle of a license and maintenance and support for a specified period. Perpetual and term-based licenses provide customers with the same functionality and differ in the duration over which the customer benefits from the software. The term-based license is recognised at the time when the software is made available to the customer. The maintenance and support service is recognised throughout the underlying term of maintenance and support, using straight-line method.

Page 14

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

2.Accounting policies (continued)

 
2.7

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.8

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

The estimated useful lives range as follows:

Leasehold improvements
-
36
months
Fixtures and fittings
-
60
months
Computer equipment
-
36
-
60
months

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 15

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

2.Accounting policies (continued)

 
2.9

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.10

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.11

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.

The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.

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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Page 16

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

2.Accounting policies (continued)


2.11
Financial instruments (continued)

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Company makes estimates and assumptions concerning the future, including significant estimates and assumptions used in estimation of the stand-alone selling price of different revenue elements, estimation of the useful life of technology and customer lifetime used in capitalisation of contract acquisition costs and bad debts allowance. The resulting accounting estimates will, by definition, seldom equal the related actual results. 

Page 17

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Software
18,257,969
18,012,137


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
8,916,705
9,605,225

Rest of Europe
8,079,743
7,130,333

Rest of the world
1,261,521
1,276,579

18,257,969
18,012,137



5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Exchange differences
(206,803)
(1,336,802)

Other operating lease rentals
-
15,394


6.


Auditor's remuneration

During the year, the Company obtained the following services from the Company's auditor:


2023
2022
£
£

Fees payable to the Company's auditor for the audit of the Company's financial statements
17,975
16,500

Page 18

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

7.


Employees

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
4,604,934
4,453,347

Social security costs
1,147,863
691,889

Cost of defined contribution scheme
359,721
98,198

6,112,518
5,243,434


On 1 February 2022, all employees of the Company were transferred to Hewlett-Packard Limited and recharged back to the Company under an intercompany agreement.

The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Sales
-
21



Marketing
-
5



General & Administration
-
1



Directors
2
1

2
28

Employee numbers represent the average up to 31 January 2022. On 1 February 2022, all employees of the Company were transferred to  Hewlett-Packard Limited.
The Directors are employed by other Group entities and the services provided to the Company are incidental and therefore no recharge of cost has been performed.


8.


Interest receivable

2023
2022
£
£


Interest receivable from group companies
38,887
-

Other interest receivable
8,515
191

47,402
191

Page 19

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

9.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
147,993
111,315

Adjustments in respect of previous periods
(28,812)
-

Total current tax
119,181
111,315

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 22.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
586,358
540,555


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 22.52% (2022 - 19%)
132,048
102,705

Effects of:


Expenses not deductible for tax purposes
10,085
11,330

Adjustments to tax charge in respect of prior periods
(28,812)
-

Other differences leading to an increase (decrease) in taxation
5,860
(2,720)

Total tax charge for the year
119,181
111,315


Tax rate changes

In the Spring Budget 2021, the UK Government announced that from 1 April 2023 the corporation tax rate would increase to 25% (rather than remaining at 19%, as previously enacted). This new law was substantively enacted on 24 May 2021. For the financial year ended 31 October 2023, the current weighted averaged tax rate was 22.52%.
Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statements.

Page 20

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

10.


Tangible fixed assets





Leasehold improve-  ments
Fixtures and fittings
Computer equipment
Total

£
£
£
£



Cost or valuation


At 1 November 2022
13,840
105,062
386,378
505,280



At 31 October 2023

13,840
105,062
386,378
505,280



Depreciation


At 1 November 2022
13,840
94,072
379,474
487,386


Charge for the year on owned assets
-
10,280
4,596
14,876



At 31 October 2023

13,840
104,352
384,070
502,262



Net book value



At 31 October 2023
-
710
2,308
3,018



At 31 October 2022
-
10,990
6,904
17,894

Page 21

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

11.


Fixed asset investments





Investments in subsidiary companies

£



Cost or valuation


At 1 November 2022
22,018



At 31 October 2023
22,018





Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Zerto Germany GmbH
Theodor-Stern-Kai 1, c/o Roever Broenner Susat Mazars GmbH & Co. KG, 60596, Frankfurt a. Main, Germany
Ordinary
100%


12.


Debtors

2023
2022
£
£

Due after more than one year

Deferred contract costs
2,042,939
1,829,316


2023
2022
£
£

Due within one year

Trade debtors
3,906,095
2,655,398

Amounts owed by group undertakings
1,329,371
786,040

Other debtors
756
72,666

Prepayments and accrued income
1,976,021
1,705,047

Deferred contract costs
1,126,249
958,733

Deferred taxation
8,352
8,352

8,346,844
6,186,236


Page 22

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

12.Debtors (continued)

Included in amounts owed by group undertakings is £919,717 (2022: £nil) owed from the Group treasury entity. Interest is earned on these amounts on the basis of an arms length calculation. All other amounts are interest free.
All amounts owed by group undertakings are unsecured, have no fixed date of repayment and repayable on demand. 


13.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
3,204,396
4,594,593



14.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
152,151
206,902

Amounts owed to group undertakings
4,280,541
3,042,509

Corporation tax
5,478
77,208

Other taxation and social security
229,529
299,069

Other creditors
2,722
2,647

Accruals and deferred income
4,472,970
4,470,570

9,143,391
8,098,905


Amounts due to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.


15.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Accruals and deferred income
1,664,214
2,206,719


Page 23

 
ZERTO UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023

16.


Deferred taxation




2023
2022


£

£






At beginning of year
8,352
8,352



At end of year
8,352
8,352

The deferred tax asset is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(13,198)
(13,198)

Other timing differences
21,550
21,550

8,352
8,352


17.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1 (2022 - 1) Ordinary share of £1.00
1
1


The Company has one class of ordinary shares which carry no right to fixed income.



18.


Reserves

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses, and share-based payments.


19.


Controlling party

The Company is a wholly owned subsidiary of Zerto Ltd, a company incorporated in Israel and registered at 15 Ariye Shenkar St., Hertsliya, Israel.  
At the balance sheet date Hewlett Packard Enterprise Company, (incorporated in USA) is regarded by the directors as being the company's ultimate parent company. The consolidated accounts of Hewlett Packard Enterprise Company are available from 1701 East Mossy Oaks Road, Spring, Texas, 77389, USA or www.investors.hpe.com/financial.

Page 24

 
ZERTO UK LIMITED
 
 
 Page 25