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Registered number: 08656087 (England and Wales)














FASTLY LIMITED


DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023


 
FASTLY LIMITED
 

 
COMPANY INFORMATION


Directors
R W Kisling 
S Paul 




Registered number
08656087



Registered office
Birchin Court
5th Floor

19-25 Birchin Lane

London

United Kingdom

EC3V 9DU




Independent auditors
ZEDRA Corporate Reporting Services (UK) Limited






 
FASTLY LIMITED
 


CONTENTS



Page
Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Statement of Comprehensive Income
 
9
Balance Sheet
 
10
Statement of Changes in Equity
 
11
Notes to the Financial Statements
 
12 - 20


 
FASTLY LIMITED
 

 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Principal activities
 
The Directors present herewith their Strategic Report of Fastly Limited (the "Company") for the year ended 31 December 2023.
The Company, incorporated in the United Kingdom (‘‘UK’’) on 19 August 2013, is a wholly owned subsidiary of Fastly International Technology Limited, incorporated in the UK, which itself is a wholly owned subsidiary of Fastly, Inc. (the ‘‘Ultimate Parent”), incorporated in the state of Delaware, in the United States of America. The Ultimate Parent company provides a content delivery network platform and solutions to customers for the delivery of online content. The principal activity of the Company is to provide marketing, sales support and other services to the Ultimate Parent company. 

Business review and future developments
 
The post-tax profit for the financial year ended 31 December 2023 was £2.8 million (2022: restated profit £1.6 million). The Company’s net assets as at 31 December 2023 were £17.7 million (2022 restated: £8.9 million). The Company provides support services to the Ultimate Parent company and its turnover, which consist of fees, are guaranteed per an Intercompany Service Agreement established on 17 December 2014 between the Company and Ultimate Parent company. Per the agreement the Company’s fees are 100% reimbursed plus an 8% margin on all operating costs of the Company. 
Based on 2024 & 2025 estimated projections, the Company expects to grow in their operations as headcount increases from 94 in January 2023 to 99 by January 2024 for a 5.3% increase year over year. As headcount is the primary factor driving operating expenses, the Company expects turnover to increase proportionately.   

Principal risks and uncertainties
 
The Company's principal risks and uncertainties are integrated with the principal risks of the Ultimate Parent company and are not managed separately. The principal risks and uncertainties of the Ultimate Parent company are discussed in the 2023 annual report Form 10-K, which does not form part of this report. This may be obtained from investors.fastly.com/financials/sec-filings.
As long as the Ultimate Parent company continues to need the Company to provide marketing, sales support and other services for the UK, fees will continue to be generated to cover operating costs.

Financial key performance indicators
 
The Company's directors monitor progress and strategy by reference to the following KPIs:

2023
2022 (Restated)
Change
Change
      £'000
      £'000
      £'000
        %
Turnover

25,934

22,253

3,681
 
17
 
Operating profit

1,922

1,576

346
 
22
 
Profit before income tax

1,950

1,580

370
 
23
 

Page 1


 
FASTLY LIMITED
 


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


The Company’s profit after tax for the financial period was £2.8m (2022: restated profit £1.6m) and as of 31 December 2023 the Company had net assets of £17.7m (2022 restated: £8.9m). The directors have received confirmation from the Ultimate Parent company, which has agreed to provide adequate financial support for a period of at least twelve months following the date of the Independent Auditor’s Report for the Company‘s year ended 31 December 2023 to the extent necessary to enable the Company to meet its continuing operating liabilities, as well as, any known liabilities on the Company’s balance sheet as at 31 December 2023, as and when they fall due. This report was approved by the board and signed on its behalf.


R W Kisling
Director

Date: 5 November 2024
Page 2


 
FASTLY LIMITED
 

 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023. As permitted by s414c (11) of the Companies Act 2006, certain information that is required to be included in the Directors' Report has otherwise been provided in the Strategic Report.

Directors

The directors who served during the year were:

R W Kisling 
S Paul 

Results and dividends

The profit for the year, after taxation, amounted to £2,765,699 (as restated 2022 - £1,583,092).

No dividends were declared, paid or payable during the reporting period (2022: £Nil)

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 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 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.

Disclosure of information to auditors

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 auditors are 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 auditors are aware of that information.
Page 3


 
FASTLY LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


Post balance sheet events

There have been no significant events affecting the Company since the year end.

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


R W Kisling
Director

Date: 5 November 2024
Page 4


 
FASTLY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FASTLY LIMITED
 

Opinion


We have audited the financial statements of Fastly Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, 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 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 Auditors' 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


 
FASTLY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FASTLY LIMITED (CONTINUED)

Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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


 
FASTLY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FASTLY LIMITED (CONTINUED)

Auditors' 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 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.


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.
 
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
 
the responsible individual ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the Company through discussions with directors and other management, and from our commercial knowledge and experience; 
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Company, including the Companies Act 2006 and taxation legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the Company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

agreeing financial statement disclosures to underlying supporting documentation;
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HMRC.

 
Page 7


 
FASTLY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FASTLY LIMITED (CONTINUED)

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.


Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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 Auditors' Report.


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 Auditors' 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.





Edward Wallis ACA (Senior Statutory Auditor)
for and on behalf of
ZEDRA Corporate Reporting Services (UK) Limited
Chartered Accountants and Statutory Auditors
Birchin Court
5th Floor
19-25 Birchin Lane
London
United Kingdom
EC3V 9DU


14 November 2024
Page 8


 
FASTLY LIMITED
 

 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

As restated
2023
2022
Note
£
£

  

Turnover
 2 
25,933,866
22,253,164

Gross profit
  
25,933,866
22,253,164

Administrative expenses
  
(24,011,897)
(20,676,672)

Operating profit
 3 
1,921,969
1,576,492

Interest receivable and similar income
  
28,498
3,276

Profit before tax
  
1,950,467
1,579,768

Tax on profit
 6 
815,232
3,324

Profit for the financial year
  
2,765,699
1,583,092

There was no other comprehensive income for 2023 (2022£NIL).
 
The notes on pages 12 to 20 form part of these financial statements.

Page 9


 
FASTLY LIMITED
REGISTERED NUMBER:08656087


BALANCE SHEET
AS AT 31 DECEMBER 2023

As restated
2023
2022
Note
£
£

  

Current assets
  

Debtors: amounts falling due within one year
 7 
18,852,319
10,097,759

Cash at bank and in hand
  
482,349
504,093

  
19,334,668
10,601,852

Creditors: amounts falling due within one year
 8 
(1,611,108)
(1,714,485)

Net current assets
  
 
 
17,723,560
 
 
8,887,367

Total assets less current liabilities
  
17,723,560
8,887,367

  

Net assets
  
17,723,560
8,887,367


Capital and reserves
  

Called up share capital 
 10 
100
100

Capital contribution reserve
 11 
14,027,733
7,957,239

Profit and loss account
 11 
3,695,727
930,028

  
17,723,560
8,887,367


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

R W Kisling
Director

Date: 5 November 2024

The notes on pages 12 to 20 form part of these financial statements.
Page 10


 
FASTLY LIMITED
 


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


Called up share capital
Capital contribution reserve
Profit and loss account
Total equity

£
£
£
£


At 1 January 2022 (as previously stated)
100
2,827,712
189,754
3,017,566

Prior year adjustment
-
842,818
(842,818)
-


At 1 January 2022 (as restated)
100
3,670,530
(653,064)
3,017,566


Comprehensive income for the year

Profit for the year
-
-
1,583,092
1,583,092


Contributions by and distributions to owners

Share based payment charge
-
4,286,709
-
4,286,709



At 1 January 2023 (as previously stated)
100
7,234,623
872,219
8,106,942

Prior year adjustment
-
722,616
57,809
780,425


At 1 January 2023 (as restated)
100
7,957,239
930,028
8,887,367


Comprehensive income for the year

Profit for the year
-
-
2,765,699
2,765,699


Contributions by and distributions to owners

Share based payment charge
-
6,070,494
-
6,070,494


At 31 December 2023
100
14,027,733
3,695,727
17,723,560


Page 11


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.Accounting policies

 
1.1

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 judgement in applying the Company's accounting policies.

The following principal accounting policies have been applied:

 
1.2

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 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Fastly, Inc. as at 31 December 2023 and these financial statements may be obtained from investors.fastly.com/financials/sec-filings.

  
1.3

Going concern

Fastly Limited is in a net asset position supported primarily by an intercompany receivable of £17,772,365 due from its ultimate parent company.
The Company has received written confirmation from its Ultimate Parent company that it will continue to provide support for a period of at least 12 months from the date of signing these financial statements. Furthermore, the directors have assessed the ability of the parent company to provide this support based upon their cashflow forecasts and have concluded that the parent will have sufficient working capital to provide necessary support.
For this reason, the directors continue to adopt the going concern basis in preparing the financial statements.

Page 12


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.Accounting policies (continued)

 
1.4

Turnover

Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Rendering of services

Turnover is recognised on a cost plus 8% basis, in line with the intercompany service agreement with the parent company. Intercompany turnover is recognised when all of the following conditions are satisfied:
the amount of turnover can be measured reliably;
it is probable that the Company will receive the consideration due under the intercompany service agreement;
the costs incurred under the intercompany service agreement can be measured reliably.

 
1.5

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.

 
1.6

Debtors

Short-term debtors are measured at transaction price, less any impairment. Amounts owed by group undertakings are intercompany loans measured at cost. No interest is charged on the loan, which is repayable on demand. 

Page 13


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.Accounting policies (continued)

 
1.7

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 held on deposit by service providers is included within bank and cash balances, as these amounts are highly liquid and repayable without penalty on notice of not more than 24 hours.

 
1.8

Creditors

Short-term creditors are measured at the transaction price.

 
1.9

Foreign currency translation

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.

 
1.10

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
1.11

Pensions

Defined contribution pension plan

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

The contributions are 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.

Page 14


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.Accounting policies (continued)

 
1.12

Share-based payments

Where share options are awarded to employees, the fair value of the options at the date of grant is charged to profit or loss 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.
Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.


2.


Turnover

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


As restated
2023
2022
£
£

Intercompany sales
25,933,866
22,253,164

25,933,866
22,253,164


All turnover arose in accordance with the intercompany services agreement with the parent company, who are registered in the United States.

Page 15


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Operating profit

The operating loss is stated after charging/(crediting):

As restated
2023
2022
£
£

Fees payable to the Company's auditor for the audit of the financial statements
12,375
11,640

Exchange differences
(943)
71,890

Other operating lease rentals
559,000
220,894

Share-based payment expense
6,070,493
4,286,709

Commission expense
2,076,050
2,269,603


4.


Employees

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
10,438,364
9,677,321

Social security costs
2,320,502
2,005,800

Cost of defined contribution scheme
437,301
389,840

13,196,167
12,072,961


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


        2023
        2022
            No.
            No.







Average employees
95
93


5.


Director's remuneration

The remuneration earned by directors in respect of the services performed in their capacity as directors of Fastly Limited was negligible and paid by other group entities.

Page 16


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
(17,612)
(3,324)


Total current tax
(17,612)
(3,324)

Deferred tax


Deferred taxation
(797,620)
-

Total deferred tax
(797,620)
-


Taxation on loss on ordinary activities
(815,232)
(3,324)

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

As restated
2023
2022
£
£


Profit on ordinary activities before tax
1,950,467
1,579,768


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
456,692
300,156

Effects of:


Expenses not deductible for tax purposes
1,433,866
919,205

Capital allowances for year in excess of depreciation
(14)
(2,779)

Short term differences
(17,613)
(251,826)

Remeasurement of deferred tax for changes in tax rates
60,409
(436,422)

Other permanent differences
(930,146)
(340,052)

Movement in deferred tax not recognised
(1,818,426)
(191,606)

Total tax charge for the year
(815,232)
(3,324)


Factors that may affect future tax charges

On 24 May 2021, Finance Bill 2021 was substantively enacted. The result of this is that the main rate of corporation tax for the UK has increased to 25% from 1 April 2023. The deferred tax asset has been calculated on this basis.
Page 17


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Debtors

As restated
2023
2022
£
£


Amounts owed by group undertakings
17,772,365
9,605,190

Other debtors
119,880
108,000

Prepayments and accrued income
102,010
113,332

Corporation tax repayable
-
199,438

Deferred tax asset
797,620
-

VAT repayable
60,444
71,799

18,852,319
10,097,759



8.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
52,802
171,130

Other taxation and social security
1,120,599
787,359

Other creditors
-
32,751

Accruals and deferred income
437,707
723,245

1,611,108
1,714,485



9.


Deferred taxation



2023


£






Charged to profit or loss
797,620



At end of year
797,620

Page 18


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
9.Deferred taxation (continued)

The deferred tax asset is made up as follows:

2023
£


Tax losses carried forward
797,620

797,620


10.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022 - 100) Ordinary shares of £1.00 each
100
100



11.


Capital contribution reserve

Certain employees of the Company have been granted restricted stock units (''RSUs'') in the Company’s parent. The RSUs are granted at fair value and vest as follows:
• 25% one year after the date of grant, followed by 1/36 each month for the following three years
• 25% one year after the date of grant, followed by 1/16 quarterly for the following three years
• 25% on each anniversary for four years
• 1/48 each month for four years
An expense equivalent to the fair value of the RSUs on the date of grant, over the vesting period, is recognised in the Statement of Comprehensive Income with the corresponding entry to the capital contribution reserve.


12.


Prior year adjustment

A prior year adjustment has been made to include the issue of bonus RSUs to employees which related to services provided in 2022. The effects of this adjustment are as follows:

increase of the capital contribution reserve by £722,616, with the corresponding increase to administrative expenditure of the same amount;
increase in the intercompany receivable of £780,425, with the corresponding increase to intercompany revenue of the same amount; and
a net increase to the profit and loss reserve brought forward of £57,809.

Page 19


 
FASTLY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than one year
349,650
135,000

349,650
135,000


14.


Controlling party

Fastly, Inc. 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 PO Box 78266, San Francisco, CA 94107, USA. 


15.


Post balance sheet events

There were no adjusting or non-adjusting events occurring between the end of the reporting period and the date these financial statements were approved. 
 
Page 20