Company registration number 11254980 (England and Wales)
THE MULTIPLAYER GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
THE MULTIPLAYER GROUP LIMITED
COMPANY INFORMATION
Directors
Mr J Hauck
(Appointed 16 December 2023)
Mr A K R Norman
(Appointed 25 January 2023)
Company number
11254980
Registered office
4th Floor
110 High Holborn
London
WC1V 6JS
Auditor
BDO Statutory Audit Firm
Block 3, Miesian Plaza
50-58 Baggot Street Lower
Dublin 2
Ireland
Business address
Heathcote Buildings
Heathcoat Street
Nottingham
NG1 3AA
THE MULTIPLAYER GROUP LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 22
THE MULTIPLAYER GROUP 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
The principal activity of the company and group during the year was that of outsourced software development for video game projects.
After making enquiries, the Directors consider it appropriate to continue to adopt the going concern basis in preparing the financial statements.
Principal risks and uncertainties
As a company in the Keywords group of companies (the “Keywords Group”), the company leverages the Keywords Group’s resources, infrastructure and processes to help manage and mitigate risks. A detailed review on the business risks and uncertainties of the Keywords Group can be found on pages 54 to 60 of the Keywords Studios plc 2023 Annual Report and Accounts which do not form part of these financial statements. A copy can be found on Companies House.
Applying these to The Multiplayer Group Limited, we consider the main risks to be as follows:
Failure to deliver services
Description & Impact
The company's services are of a time-critical nature with delays or service delivery failures potentially impacting the development or launch plans for games or lost contracts & idle capacity.
Mitigation
Timely delivery and the resource flexibility to enable delivery to tight deadlines is an integral part of the company’s service, in line with the Keywords Group’s approach. Client contracts enable hybrid working capability to provide flexibility to deliver services from a variety of locations. Prevention of data loss is a key part of the company’s risk programme and business continuity plans have been developed to mitigate any potential disruption.
Tax credits withdrawal risk
Description & Impact
The company receives video games tax relief (VGTR) in the UK relating to qualify costs, a regime designed to promote growth and investment. Any reduction or cancellation of these tax credits could increase the cost base of the business and make the business less competitive.
Mitigation
The Keywords Group works closely with regulators and the government in relation to the tax credits and there is no indication at the date of this report that these tax credits will be removed in the medium term.
Sudden business interruption
Description & Impact
The company, being part of the Keywords Group, needs to minimise business interruptions and be able to continue servicing customer. This threat could be internal such as a major failure in its IT systems but also external such as a pandemic or geopolitical instability.
Mitigation
The group is structured in a way that ensures continuity in production due to adoption of the hybrid working model which minimises disruption. Business continuity plans have been developed to mitigate any potential disruption
Key performance indicators
The company generated a profit before taxation for the year of £5,437,103 (2022: £4,632,189). The net asset position of the group decreased to £5,494,737 (2022: increased to £10,677,821) reflecting the impact of profit in the year and dividends paid.
Dividends of £9,000,000 (2022: £Nil) were paid by the company during the year. The directors do not recommend a final dividend.
THE MULTIPLAYER GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Other performance indicators
A standard set of key performance indicators, including revenue, expense and gross profit margin metrics are consistently applied at the company. Financial control is exercised through a rigorous annual budgeting process, timely monthly financial reporting and monthly financial review meetings. The directors are satisfied that reviews of such business and financial results reflect good business practice and that such reviews are performed in a timely manner to allow any required necessary corrective action to be taken.
Other information and explanations
The company is a subsidiary of Keywords Studios plc, a company listed on the AIM Stock Exchange. The company operates in the video games industry and contracts with large gaming developers worldwide which continually presents the company with significant opportunities.
Future development
The directors are of the opinion that the group’s activities will continue on a similar basis for the foreseeable future.
Mr J Hauck
Director
1 November 2024
THE MULTIPLAYER GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
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 outsourcing employees to companies in the video game industry.
Results and dividends
The profit for the year, after taxation, amounted to £3,816,916 (2022: £4,470,717).
During the year the company paid dividends amounting to £9,000,000 (2022: £3,800,000).
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:
Mr G Duranti
(Appointed 16 December 2023 and resigned 22 October 2024)
Mr J Hauck
(Appointed 16 December 2023)
Mr A K R Norman
(Appointed 25 January 2023)
Auditor
The auditors, BDO Ireland, will be proposed for re-appointment at the forthcoming Annual General Meeting.
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.
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. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
THE MULTIPLAYER GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
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
Mr J Hauck
Director
1 November 2024
THE MULTIPLAYER GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF THE MULTIPLAYER GROUP LIMITED
- 5 -
Opinion
We have audited the financial statements of The Multiplayer Group Limited (‘the Company’) for the year ended 31 December 2023, which comprise the Profit and Loss Account, the Balance Sheet, the Statement of Changes in Equity, and the notes to the financial statements, including a summary of significant accounting policies as set out in Note 1. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 the Financial Reporting Standard applicable in the UK and Republic of Ireland issued in the United Kingdom by the Financial Reporting Council.
In our opinion the financial statements:
give a true and fair view of the assets, liabilities and financial position of the Company as at 31 December 2023 and of its result for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been properly 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.true
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 directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditor’s Report thereon. 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.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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
Based solely on the work undertaken in the course of the audit, we report that:
in our opinion, the information given in the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
in our opinion, the directors’ report has been prepared in accordance with applicable legal requirements.
THE MULTIPLAYER GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF THE MULTIPLAYER GROUP LIMITED
- 6 -
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 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; or
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies’ exemptions in preparing the directors’ report and from the requirement to prepare a strategic report.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set on page 1, 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 they 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 going concerns, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
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.
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 Auditors' 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 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 was as follows:
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company. We determined that the most significant which are directly relevant to specific assertions in the financial statements are those related to the reporting framework (FRS102 and the Companies Act 2006).
We understood how the Company is complying with those legal and regulatory frameworks by making enquiries to management and those responsible for legal and compliance procedures and the Company secretary. We corroborated our enquiries through our review of board minutes.
We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur by meeting with management from various parts of the business to understand where it is considered there was a susceptibility of fraud. We considered the programs and controls that the Company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those programs and controls. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included testing manual journals and were designed to provide reasonable assurance that the financial statements were free of fraud or error.
THE MULTIPLAYER GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF THE MULTIPLAYER GROUP LIMITED
- 7 -
A further description of our responsibilities for the audit of the financial statements is located at the Financial Reporting Council’s (“FRC’s”) website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Stephen McCallion
Senior Statutory Auditor
For and on behalf of BDO Statutory Audit Firm
1 November 2024
Chartered Accountants
Statutory Auditor
Block 3, Miesian Plaza
50-58 Baggot Street Lower
Dublin 2
Ireland
THE MULTIPLAYER GROUP LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
37,867,697
28,549,368
Cost of sales
(25,404,018)
(17,593,345)
Gross profit
12,463,679
10,956,023
Administrative expenses
(6,329,918)
(6,594,850)
Other operating income
170,688
One-time costs
4
(755,737)
Operating profit
5
5,378,024
4,531,861
Interest receivable and similar income
8
59,079
100,328
Profit before taxation
5,437,103
4,632,189
Tax on profit
9
(1,620,187)
(161,472)
Profit for the financial year
3,816,916
4,470,717
The profit and loss account has been prepared on the basis that all operations are continuing operations.
THE MULTIPLAYER GROUP LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
1,186,726
1,811,572
Investments
12
6,418
6,418
1,193,144
1,817,990
Current assets
Debtors
14
7,022,636
15,254,077
Cash at bank and in hand
7,213,718
7,586,954
14,236,354
22,841,031
Creditors: amounts falling due within one year
15
(9,488,952)
(13,557,270)
Net current assets
4,747,402
9,283,761
Total assets less current liabilities
5,940,546
11,101,751
Provisions for liabilities
Deferred tax liability
16
445,809
423,930
(445,809)
(423,930)
Net assets
5,494,737
10,677,821
Capital and reserves
Called up share capital
19
1,670
1,670
Profit and loss reserves
5,493,067
10,676,151
Total equity
5,494,737
10,677,821
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 1 November 2024 and are signed on its behalf by:
Mr J Hauck
Director
Company registration number 11254980 (England and Wales)
THE MULTIPLAYER GROUP LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
1,670
5,148,803
5,150,473
Year ended 31 December 2022:
Profit and total comprehensive income
-
4,470,717
4,470,717
Credit to equity for equity settled share-based payments
-
1,056,631
1,056,631
Balance at 31 December 2022
1,670
10,676,151
10,677,821
Year ended 31 December 2023:
Profit and total comprehensive income
-
3,816,916
3,816,916
Dividends
10
-
(9,000,000)
(9,000,000)
Balance at 31 December 2023
1,670
5,493,067
5,494,737
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information
The Multiplayer Group Limited is a private company limited by shares incorporated in England and Wales. The registered office is 4th Floor, 110 High Holborn, London, WC1V 6JS.
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 sterling, which is the functional currency of the company. Monetary amounts in
these financial statements are rounded to the nearest £. Please note that the ultimate parent company, Keywords Studios PLC, report in Euro (€).
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet 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. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Fee income represents revenue earned under a wide variety of contracts to provide professional services. Revenue is recognised as earned when, as to that, the firm obtains the right to consideration in exchange for its performance under these contracts. It is measured at the fair value to the right to consideration, which represents amounts chargeable to clients, including expenses and disbursements but excluding VAT.
Revenue is generally recognised as contract activity progresses so that for incomplete contracts it reflects the partial performance of the contractual obligations. For such contracts, the amount of revenue reflects the accrual of the right to consideration by reference to the value of work performed. Revenue not billed to clients is included in debtors and payments on account in excess of the relevant amount of revenue are included within creditors.
Fee income that is contingent on events outside the control of the firm is recognised when the contingent event occurs.
1.4
Tangible fixed assets
Tangible fixed assets 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:
Leasehold improvements
Life of lease = 60 months or 5 years
Fixtures and fittings
15% straight line
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 profit or loss.
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.7
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.
1.8
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 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 debtors 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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, 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 profit or loss.
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 profit or loss.
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.
Basic financial liabilities
Basic financial liabilities, including creditors, 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 creditors 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 creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, 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, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.9
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.
1.10
Taxation
The tax expense represents the sum of the current tax charge and deferred tax.
Current tax
The current tax charge is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax is provided in full on timing differences which result in an obligation at the balance sheet date to pay more tax, or a right to pay less tax, at a future date, at rates expected to apply when they crystallise based on current tax rates and law.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Timing differences arise from the inclusion of items of income and expenditure in taxation computations in periods
different from those which they are included in financial statements.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Share-based payments
For cash-settled share-based payments, a liability is recognised for the goods and services acquired, measured initially at the fair value of the liability. At the balance sheet date until the liability is settled, and at the date of settlement, the fair value of the liability is remeasured, with any changes in fair value recognised in profit or loss for the year.
1.14
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.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling 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.
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
2
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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Impairment of tangible fixed assets
The company conducts impairment reviews of investments in subsidiaries whenever events or circumstances indicate that their carrying value may not be recoverable. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset and whether it is a component of a larger cash-generating unit, the viability and expected future performance of that unit.
Entering into leases
Determine whether leases entered into by the company either as a lessor or a lessee are operating or finance leases. These decisions depend on an assessment of whether the risk and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis.
Recoverability of trade & other debtors
The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, ageing profile of debtors and historical experience.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Tangible fixed assets
Tangible fixed assets are depreciated over their useful lives taking into account residual values where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. Residual value assessments consider issues such as future market conditions, the remaining useful life of the asset and projected disposal values.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Sale of services
37,867,697
28,549,368
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 16 -
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
9,844,034
9,172,805
United States of America
26,469,309
15,882,931
Rest of World
1,554,354
3,493,632
37,867,697
28,549,368
2023
2022
£
£
Other revenue
Interest income
59,079
100,328
4
One-time costs
2023
2022
£
£
Expenditure
Impairment of tangible fixed assets
755,737
-
5
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
10,454
(78,661)
Fees payable to the company's auditor for the audit of the company's financial statements
Depreciation of owned tangible fixed assets
427,495
305,220
Impairment of owned tangible fixed assets
521,033
Share-based payments
-
1,056,631
Operating lease charges
141,023
145,659
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
152
143
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 17 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
12,702,363
9,421,498
Social security costs
1,499,058
1,015,697
Pension costs
164,280
193,509
14,365,701
10,630,704
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
514,432
Company pension contributions to defined contribution schemes
1,321
-
515,753
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
59,079
100,328
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
1,598,308
Deferred tax
Origination and reversal of timing differences
21,879
122,719
Changes in tax rates
38,753
Total deferred tax
21,879
161,472
Total tax charge
1,620,187
161,472
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
(Continued)
- 18 -
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
5,437,103
4,632,189
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
1,277,719
880,116
Tax effect of expenses that are not deductible in determining taxable profit
320,589
202,910
Effect of change in corporation tax rate
38,754
Group relief
(910,621)
Permanent capital allowances in excess of depreciation
21,879
(49,687)
Taxation charge for the year
1,620,187
161,472
10
Dividends
2023
2022
£
£
Final paid
9,000,000
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
11
Tangible fixed assets
Leasehold improvements
Fixtures and fittings
Computers
Total
£
£
£
£
Cost
At 1 January 2023
203,526
81,860
2,073,204
2,358,590
Additions
37,646
14,212
506,528
558,386
Transfers from group companies
439,069
439,069
Impairment losses
(512,229)
(512,229)
At 31 December 2023
241,172
96,072
2,506,572
2,843,816
Depreciation and impairment
At 1 January 2023
52,677
29,646
464,695
547,018
Depreciation charged in the year
46,603
13,939
366,953
427,495
Impairment losses
521,033
521,033
Depreciation on transfers from group companies
161,544
161,544
At 31 December 2023
99,280
43,585
1,514,225
1,657,090
Carrying amount
At 31 December 2023
141,892
52,487
992,347
1,186,726
At 31 December 2022
150,849
52,214
1,608,509
1,811,572
The company reviewed the carrying amounts of its tangible assets at period end and determined that the carrying value was impaired, which resulted in an impairment loss of £755,736.
12
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
13
6,418
6,418
13
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
The Multiplayer Group (Canada) Inc.
2500-10200 103 AVE NW, Edmonton, Alberta. Canada, T5J0K4
Ordinary
100.00
The Multiplayer Group (Spain), S.L.
Num 9. Calle Colegiata, 28012 Madrid
Ordinary
100.00
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
5,185,107
3,830,026
Corporation tax recoverable
772,209
190,691
Amounts owed by group undertakings
111,885
9,621,484
Other debtors
16,796
246,201
Prepayments and accrued income
936,639
1,365,675
7,022,636
15,254,077
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Trade creditors
273,806
140,763
Amounts owed to group undertakings
428,138
12,054,164
Corporation tax
1,427,620
Other taxation and social security
744,403
1,224,443
Deferred income
17
3,644,810
Other creditors
772,209
315
Accruals and deferred income
2,197,966
137,585
9,488,952
13,557,270
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
445,809
438,287
Short term timing differences
-
(14,357)
445,809
423,930
2023
Movements in the year:
£
Liability at 1 January 2023
423,930
Charge to profit or loss
21,879
Liability at 31 December 2023
445,809
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
16
Deferred taxation
(Continued)
- 21 -
The deferred tax liability set out above is expected to reverse within [12 months] and relates to accelerated capital allowances that are expected to mature within the same period.
17
Deferred income
2023
2022
£
£
Other deferred income
3,644,810
-
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
164,280
193,509
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 of £1 each
1,670
386
1,670
386
of £1 each
-
314
-
314
of £1 each
-
50
-
50
of £1 each
-
50
-
50
of £1 each
-
870
-
870
1,670
1,670
1,670
1,670
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
110,299
50,179
Between two and five years
30,086
40,185
140,385
90,364
THE MULTIPLAYER GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
21
Related party transactions
As a wholly owned subsidiary undertaking of Keywords Studios PLC, the company has taken advantage of the exemption under Financial Reporting Standard 102, paragraph 33.1A, not to disclose transactions with other group companies.true
22
Ultimate controlling party
The immediate parent undertaking is Keywords UK Holdings Limited and its registered office is 4th Floor, 110 High Holborn, London, WC1V 6JS.
The ultimate parent undertaking is Keywords Studios PLC and its registered office is 4th Floor, 110 High Holborn, London, WC1V 6JS. Keywords Studios PLC heads the group for which consolidated financial statements are prepared, that include the results of the company. Copies can be obtained from the Companies House website.
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