Registered number: 10436399 (England and Wales)
ALTERIAN SOFTWARE LIMITED
DIRECTORS' REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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ALTERIAN SOFTWARE LIMITED
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COMPANY INFORMATION
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ZEDRA Corporate Reporting Services (UK) Limited
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ALTERIAN SOFTWARE LIMITED
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CONTENTS
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Notes to the Financial Statements
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ALTERIAN SOFTWARE LIMITED
REGISTERED NUMBER:10436399
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BALANCE SHEET
AS AT 31 DECEMBER 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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ALTERIAN SOFTWARE LIMITED
REGISTERED NUMBER:10436399
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BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 3 to 11 form part of these financial statements.
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of 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 judgement in applying the Company's accounting policies (see note 2).
The following principal accounting policies have been applied:
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Exemption from preparing consolidated financial statements
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The Company, and the group headed by it, qualify as small as set out in section 383 of the Companies Act 2006 and the parent and group are considered eligible for the exemption to prepare consolidated accounts.
The Company is in a net asset position which is primarily as a result of amounts owed by group undertakings arising from the transfer pricing arrangement with Alterian Software LLC, and therefore the Company is reliant on Alterian Software LLC, in order to remain a going concern.
The directors have considered the ability of Alterian Software LLC to provide this support based upon the anticipated cash flows. Due to the significant level of cash burn and the uncertainty surrounding the key judgements reflected within the cashflow forecasts, this position may cast a material uncertainty over the ability of the parent company to support the Company at the current rate. Despite this, the directors believe the Group have sufficient working capital requirements to support the Company for a minimum of 12 months from the date of approval of these financial statements. For this reason, the directors continue to prepare the financial statements on a going concern basis.
Turnover is generated from five main sources:
- Subscription and support turnover, which is comprised of Software-as-a-Service (SaaS) fees from customers accessing the Company's customer experience, campaign management and email management platforms as well as the provision of support.
- Professional services turnover, which is comprised of training, implementation services and other types of professional services.
- Outsourced services turnover, which is comprised of recharges from Alterian Software LLC for the use of Company resources to generate sales for Alterian Software LLC, a fellow subsidiary.
- Royalty turnover, which is comprised of amounts payable for the use of resources by Alterian Software Pty Ltd for administrative, marketing and support purposes.
- Transfer pricing fee income is earned from Alterian Software LLC, a fellow subsidiary.
Direct subscription and support turnover is derived from customers using the Company's customer experience, campaign management and email management platforms through a hosted delivery
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies (continued)
model under a SaaS offering. This stream of turnover is driven primarily by the number of customers, the price of licenses and the level of technical support. All subscription and support fees billed are recognised straight-line over the subscription term. Email overages are recognised as total volumes that exceed contracted amounts.
Professional services turnover is derived primarily from implementation, training and other consulting fees. This turnover is recognised on delivery of the service.
Outsourced services turnover is derived from recharged actual employee costs, with an independently calculated mark up, from Alterian Software LLC.
Royalty turnover is derived by calculating the recharge required to fix the operating profit of Alterian Software Pty Ltd at a fixed margin.
Transfer pricing fee is derived from a cost sharing agreement.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is 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.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight line basis over the lease term.
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 recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies (continued)
Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight line basis to the Statement of Comprehensive Income over its useful economic life.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
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.
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:
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.
Investments in subsidiaries are measured at cost less accumulated impairment.
Share premium represents the consideration receivable upon the allotment of share capital in excess of the shares’ par value.
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
1.Accounting policies (continued)
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the Statement of Comprehensive Income over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each Balance Sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Company keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
Short term debtors are measured at transaction price, less any impairment. Amounts owed by group undertakings are intercompany loans measured at cost. These loans are unsecured, interest free and repayable on demand.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions.
Short term creditors are measured at the transaction price.
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Judgements in applying accounting policies and key sources of estimation uncertainty
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The preparation of financial statements in conformity with FRS 102 requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabiliites, income and expenses. Estimates and judgements 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.
Investment in subsidiary undertakings
At each year end, the directors assess the investments in subsidiary undertakings for indicators of impairment. This requires the use of management judgement and an assessment of the recoverable amounts of the net assets of the subsidiary undertakings, including the values associated with its assets. The assumptions for the recoverable amounts of the investments are subject to change as a result of changing economic conditions and management will continue to make assessments as to whether impairment of these investments is required.
Share based payments
The Company has a share option scheme in place with share options having been granted to employees historically. However, the only redemption condition for these options is in relation to a Liquidating Distribution. This requires the use of management judgement as to whether an exit event is likely to occur before the expiry of the options.
The auditors' report on the financial statements for the year ended 31 December 2023 was unqualified, though the auditor drew attention to note 2.2 to these accounts that indicate the existence of material uncertainty which may cause significant doubt on the Company's ability to continue as a going concern.
The audit report was signed on 28 October 2024 by Nick Whitehead FCCA (Senior Statutory Auditor) on behalf of ZEDRA Corporate Reporting Services (UK) Limited.
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The average monthly number of employees during the year was 39 (2022 - 34).
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Charge for the year on owned assets
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Investments in subsidiary companies
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Amounts owed by group undertakings
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Prepayments and accrued income
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Accruals and deferred income
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Commitments under operating leases
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At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Alterian Software Holdings LLC is the parent of the smallest group for which consolidated financial statements are drawn up of which the Company is a member. The registered office of the parent company is 1550 Larimer St., Suite 105, Denver, CO 80202.
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ALTERIAN SOFTWARE LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Post balance sheet events
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In July 2024, the Directors announced restructuring plans for the Company that would result in a reduction of headcount. The resulting impact on the Company were costs amounting to £61,960. In September 2024, further reductions in headcount were announced. This resulted in further costs amounting to £257,043. Both events are considered to be non-adjusting events.
There were no adjusting or other non-adjusting events occurring between the end of the reporting period and the date these financial statements were approved.
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