Registration number:
Alfa Energy Limited
for the Year Ended 31 December 2023
Alfa Energy Limited
Contents
Company Information |
|
Strategic Report |
|
Directors' Report |
|
Independent Auditor's Report |
|
Consolidated Profit and Loss Account |
|
Consolidated Statement of Comprehensive Income |
|
Consolidated Balance Sheet |
|
Balance Sheet |
|
Consolidated Statement of Changes in Equity |
|
Consolidated Statement of Cash Flows |
|
Notes to the Financial Statements |
Alfa Energy Limited
Company Information
Directors |
Mr Elvin Ahmovic Ms Evangeline Kroener Andersen Mr John Andrew Murphy |
Registered office |
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Auditors |
|
Alfa Energy Limited
Strategic Report for the Year Ended 31 December 2023
The directors present their strategic report for the year ended 31 December 2023.
Principal activity
The principal activity of the group is providing clients with energy and sustainability consultancy services, supported by proprietary software solutions.
Fair review of the business
Following the acquisition of Alfa Energy Ltd by Edison Energy LLC in the last quarter of 2022, 2023 represented a time of transition for the company.
The increased market volatility and escalating whole sales prices experienced in the prior years has stabilised through 2023, leading to steady revenue growth, an increase of 13% on the prior year.
Following the acquisition by Edison Energy LLC, integration activities carried on into 2023 to bring together the strengths of both companies to support customers with their ever challenging energy requirements. Alfa Energy continues to win new business and grow its already broad customer portfolio.
During the year, the company paid dividends of £nil (2022: £320,000).
Alfa Energy Limited
Strategic Report for the Year Ended 31 December 2023 (continued)
Principal risks and uncertainties
Retention of key personnel
The company regularly benchmarks salaries and uses a mix of commission and bonus payments to attract and retain key management and staff based on performance.
Risk relating to the cost of energy
The group advises clients procuring energy based upon the prices offered by energy suppliers. When there is higher volatility in the supply price of energy, the group's clients may delay renewal decision until they see stability in prices that enables them to commit to medium and longer term contracts. This would cause a reduction to the group's revenue from commission-based sales.
Liquidity risks
The group maintains sufficient liquidity in order to ensure continuity of business.
Currency risk
The group makes purchases in foreign currency and closely monitors exchange rate movements so that appropriate action can be taken in the event of a major fluctuation in the currency market.
Security risk
The group places significant reliance on the networks and IT systems within the business. The day-to-day running of the business is reliant on the CRM system and other customer facing technology and any extended downtime would impact the group's ability to operate. The group builds security and resilience into the networks and systems to mitigate the risk from attack or system failures and has developed a robust business continuity plan.
Legislation and regulatory
Previously, energy procurement was an unregulated market. In October 2022, regulations to govern relationships between energy suppliers, brokers and micro clients came into force.
Approved by the
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Alfa Energy Limited
Directors' Report for the Year Ended 31 December 2023
The directors present their report and the for the year ended 31 December 2023.
Directors of the group
The directors who held office during the year were as follows:
Alfa Energy Limited
Directors' Report for the Year Ended 31 December 2023 (continued)
Methodology
A location-based calculation of CO2 equivalent emissions was made using energy data collected from utility energy suppliers. Energy and emissions from owned transport were modelled using fuel report data and mileage data.
A market-based calculation was based on a renewable electricity contract for the London office and location based factors for Sarajevo & Frankfurt.
The total disclosed energy is calculated on a gross calorific value basis with exception of business mileage energy which is calculated on a net calorific value basis.
The methodology is consistent with the 2023 edition of the UK Government GHG Conversion Factors for Company Reporting
(https://www.gov.uk/government/collections/government-conversion-factors-for-company-reporting). Sarajevo and Frankfurt emission factors for electricity were based on EcoInvent 3.9.1.
Defra natural gas emission factors were used for Sarajevo & Frankfurt.
A location-based method reflects the average emissions intensity of grids on which energy consumption occurs and a market-based method reflects emissions from electricity that companies have selected.
Narrative of energy efficiency action over the financial year 2023
The Environmental Management System (EMS) at our London office is certified to ISO 14001. The EMS includes a range of programmes that relate to waste, purchasing, energy efficiency, and emissions reductions. Alfa Energy purchased electricity with zero CO2e emissions throughout 2023 in London, which reduced our market-based emissions by 9.59 tonnes CO2e.
Future developments
The group's pipeline of opportunities has grown and having continued to invest in the development of its people, sustainability services and software solutions, the group is in a very strong position to respond to opportunities as they arise.
Research and development
The company has developed bespoke software over several years. Research and Development is primarily focussed on expanding core functionality across products with a focus on clients for revenue protection and the management of data.
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.
Alfa Energy Limited
Directors' Report for the Year Ended 31 December 2023 (continued)
Approved by the
......................................... |
Alfa Energy Limited
Independent Auditor's Report to the Members of Alfa Energy Limited
Opinion
We have audited the financial statements of Alfa Energy Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The 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 group's and the parent company's affairs as at 31 December 2023 and of the group's loss for the year then ended; |
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
• | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 director's 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 group's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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.
Other information
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.
Opinion on other matter prescribed by the Companies Act 2006
Alfa Energy Limited
Independent Auditor's Report to the Members of Alfa Energy Limited (continued)
In our opinion, based on the work undertaken in the course of the audit:
• |
the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
• |
the Strategic Report and 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 our 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 and the Directors' Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• | adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
• | the parent company 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 , set out on page , 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 group’s and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor Responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Extent to which the audit was considered capable of detecting irregularities, including fraud
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
Alfa Energy Limited
Independent Auditor's Report to the Members of Alfa Energy Limited (continued)
Identify and assessing potential risks related to irregularities
As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
To identify risks of material misstatement due to fraud, we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide opportunity to commit fraud. In this risk assessment, we considered and carried out the following:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation (i.e., gives a true and fair view).
• We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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 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.
Alfa Energy Limited
Independent Auditor's Report to the Members of Alfa Energy Limited (continued)
......................................
For and on behalf of
Savoy House
Savoy Circus
W3 7DA
Alfa Energy Limited
Consolidated Profit and Loss Account for the Year Ended 31 December 2023
Note |
31.12.23 |
31.12.22 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Other operating income |
- |
|
|
Operating (loss)/profit |
( |
|
|
Other interest receivable and similar income |
|
|
|
Interest payable and similar expenses |
( |
( |
|
(81) |
(11,019) |
||
(Loss)/profit before tax |
( |
|
|
Tax on (loss)/profit |
( |
|
|
(Loss)/profit for the financial year |
( |
|
|
Profit/(loss) attributable to: |
|||
Owners of the company |
( |
|
The group has no recognised gains or losses for the year other than the results above.
Alfa Energy Limited
Consolidated Statement of Comprehensive Income for the Year Ended 31 December 2023
31.12.23 |
31.12.22 |
|
(Loss)/profit for the year |
( |
|
Total comprehensive income for the year |
( |
|
Total comprehensive income attributable to: |
||
Owners of the company |
( |
|
Alfa Energy Limited
(Registration number: 04688350)
Consolidated Balance Sheet as at 31 December 2023
Note |
31.12.23 |
31.12.22 |
|
Fixed assets |
|||
Intangible assets |
|
|
|
Tangible assets |
|
|
|
|
|
||
Current assets |
|||
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets |
|
|
|
Total assets less current liabilities |
|
|
|
Provisions for liabilities |
( |
( |
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
261 |
261 |
|
Other reserves |
3,063,967 |
3,078,106 |
|
Retained earning |
1,699,003 |
2,131,719 |
|
Equity attributable to owners of the company |
4,763,231 |
5,210,086 |
|
Shareholders' funds |
4,763,231 |
5,210,086 |
Approved and authorised by the
......................................... |
Alfa Energy Limited
(Registration number: 04688350)
Balance Sheet as at 31 December 2023
Note |
31.12.23 |
31.12.22 |
|
Fixed assets |
|||
Tangible assets |
|
|
|
Investments |
|
|
|
|
|
||
Current assets |
|||
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets |
|
|
|
Total assets less current liabilities |
|
|
|
Provisions for liabilities |
( |
( |
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
261 |
261 |
|
Other reserves |
3,077,487 |
3,077,487 |
|
Retained earning |
2,542,776 |
2,894,906 |
|
Shareholders' funds |
5,620,524 |
5,972,654 |
The parent company has taken advantage of section 408 of the Companies Act 2006 and has not included its own profit and loss account in these financial statements. The parent company's loss for the year was £352,812 (2022 - profit of £661,299)
Approved and authorised by the
......................................... |
Alfa Energy Limited
Consolidated Statement of Changes in Equity for the Year Ended 31 December 2023
Equity attributable to the parent company
Share capital |
Other reserve |
Foreign Currency Translation |
Profit and loss account |
Total |
|
At 1 January 2023 |
|
|
|
|
|
Loss for the year |
- |
- |
- |
( |
( |
Total comprehensive income |
- |
- |
- |
( |
( |
Foreign currency translation |
- |
- |
(14,139) |
- |
(14,139) |
At 31 December 2023 |
|
|
( |
|
|
Share capital |
Other reserve |
Foreign Currency Translation |
Profit and loss account |
Total |
|
At 1 January 2022 |
|
|
( |
|
|
Profit for the year |
- |
- |
- |
|
|
Total comprehensive income |
- |
- |
- |
|
|
Dividends |
- |
- |
- |
( |
( |
New share capital subscribed |
|
- |
- |
- |
|
Foreign currency translation |
- |
- |
31,596 |
- |
31,596 |
At 31 December 2022 |
|
|
|
|
|
Alfa Energy Limited
Consolidated Statement of Cash Flows for the Year Ended 31 December 2023
Note |
31.12.23 |
31.12.22 |
|
Cash flows from operating activities |
|||
Operating profit for the year |
( |
|
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
Foreign exchange movements |
(954) |
9,150 |
|
Profit on disposal of tangible assets |
- |
(790) |
|
|
|
||
Working capital adjustments |
|||
Increase in trade debtors |
( |
( |
|
Increase/(decrease) in trade creditors |
|
( |
|
(Increase)/decrease in other debtors |
(332,500) |
(204,511) |
|
Increase/(decrease) in other creditors |
912,678 |
1,213,304 |
|
(Decrease)/increase in provisions |
- |
(232,045) |
|
Cash generated from operations |
|
|
|
Income taxes paid |
- |
( |
|
Net cash flow from operating activities |
|
|
|
Cash flows from investing activities |
|||
Interest received |
|
|
|
Acquisitions of tangible assets |
( |
( |
|
Net cash flows from investing activities |
( |
( |
|
Cash flows from financing activities |
|||
Proceeds from issue of ordinary shares, net of issue costs |
- |
|
|
Repayment of other borrowing |
- |
( |
|
Dividends paid |
- |
( |
|
Loan repayment received |
- |
25,624 |
|
Net cash flows from financing activities |
- |
( |
|
Net increase/(decrease) in cash and cash equivalents |
|
( |
|
Cash and cash equivalents at 1 January |
|
|
|
Cash and cash equivalents at 31 December |
2,644,531 |
2,065,735 |
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
England
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
The presentational currency is Pound Sterling (£).
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December 2023.
No Profit and Loss Account is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a loss after tax for the financial year of £352,128 (2022 - profit of £661,301).
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
2 |
Accounting policies (continued) |
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued, and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.
Judgements
The preparation of these financial statements conforms with United Kingdom Generally Accepted Accounting Practice and requires management to make estimates and judgements that affect the reported amounts of assets and liabilities at the year-end date and the reported amounts of revenues and expenses during the reporting period. The areas where most judgement is required, and which include key sources of estimation of uncertainty are highlighted below:
Impairment of assets
Equipment is reviewed for impairment where events or changes in circumstances indicate that the carrying amount may not be recoverable. When a review for impairment is conducted, the recoverable amount of an asset is determined based on value in use calculations driven by assumptions and estimates surrounding future performance.
Estimates relating to revenue, accrued income and provisions
The value of a commission-based sale is based on estimates of consumption over the length of the contract. The company does not recognise the full potential value when entering each contract but estimates how much each one should be written down for factors such as usage variance, cancellations and other factors. These estimates are based on historic data and trends.
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
2 |
Accounting policies (continued) |
Revenue recognition
Revenue is derived from commission-based sales and direct fee agreements.
For commission-based sales, the company negotiates rates with energy suppliers on behalf of clients and generates revenue as commission from the energy suppliers. Clients are segmented based on the characteristics of the services provided and revenue recognition takes into account the level of ongoing services provided in each segment. The revenue is recognised at the fair value of the consideration received or receivable at the point that the services have been rendered and costs incurred, with provisions considered for a tolerance based on known business trends.
Direct fee contracts are treated as a provision of service over the length of the agreement, matching revenue and costs.
Foreign currency transactions and balances
Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used.
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
2 |
Accounting policies (continued) |
Asset class |
Depreciation method and rate |
Office Equipment |
25% straight line |
Plant and machinery |
25% reducing balance and 25% straight line |
Fixtures and fittings |
25% reducing balance |
Business combinations
Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.
Amortisation
Amortisation is provided on intangible assets to write off the cost, less any estimated residual value, over their useful life as follows:
Asset class |
Amortisation method and rate |
Goodwill |
Over 10 years |
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade debtors
Trade debtors are amounts due for services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the receivables.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price.
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
2 |
Accounting policies (continued) |
Provisions
Provisions are recognised when the group has an obligation at the reporting date as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Dividends
Dividend distribution to the group’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions to meet any shortfall that may arise due to poor fund returns.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due.
Turnover |
The analysis of the group's Turnover for the year from continuing operations is as follows:
31.12.23 |
31.12.22 |
|
Rendering of services |
|
|
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Operating (loss)/profit |
Arrived at after charging/(crediting)
31.12.23 |
31.12.22 |
|
Depreciation expense |
|
|
Amortisation expense |
|
|
Foreign exchange losses/(gains) |
|
( |
Operating lease expense - property |
|
|
Profit on disposal of property, plant and equipment |
- |
( |
Staff costs |
The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:
31.12.23 |
31.12.22 |
|
Operational |
|
|
Sales and marketing |
|
|
Administration and support |
|
|
|
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
31.12.23 |
31.12.22 |
|
Remuneration including social security |
|
|
Contributions paid to money purchase schemes |
|
|
111,285 |
320,833 |
At the year end, the number of directors who were receiving benefits was as follows:
31.12.23 |
31.12.22 |
|
Accruing benefits under money purchase pension scheme |
|
|
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Auditors' remuneration |
31.12.23 |
31.12.22 |
|
Audit of these financial statements |
27,000 |
19,550 |
Other fees to auditors |
||
All other non-audit services |
|
|
Taxation |
Tax charged/(credited) in the consolidated profit and loss account
31.12.23 |
31.12.22 |
|
Current taxation |
||
Group Corporation Tax |
|
( |
Deferred taxation |
||
Arising from origination and reversal of timing differences |
( |
( |
Tax expense/(receipt) in the income statement |
|
( |
The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2022 - the same as the standard rate of corporation tax in the UK) of
The differences are reconciled below:
31.12.23 |
31.12.22 |
|
(Loss)/profit before tax |
( |
|
Corporation tax at standard rate |
( |
|
Tax increase from effect of capital allowances and depreciation |
|
|
Tax decrease from other short-term timing differences |
( |
( |
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
Tax decrease from effect of exercise of employee share options |
- |
( |
Tax decrease arising from overseas tax suffered/expensed |
( |
( |
Tax (decrease)/increase from other tax effects |
( |
|
Total tax charge/(credit) |
|
( |
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Intangible assets |
Group
Goodwill |
Total |
|
Cost or valuation |
||
At 1 January 2023 |
|
|
At 31 December 2023 |
|
|
Amortisation |
||
At 1 January 2023 |
|
|
Amortisation charge |
|
|
At 31 December 2023 |
|
|
Carrying amount |
||
At 31 December 2023 |
|
|
At 31 December 2022 |
|
|
Company
Goodwill |
Total |
|
Cost or valuation |
||
At 1 January 2023 |
|
|
At 31 December 2023 |
|
|
Amortisation |
||
At 1 January 2023 |
|
|
At 31 December 2023 |
|
|
Carrying amount |
||
At 31 December 2023 |
- |
- |
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Tangible assets |
Group
Plant and machinery |
Total |
|
Cost or valuation |
||
At 1 January 2023 |
|
|
Revaluations |
( |
( |
Additions |
|
|
At 31 December 2023 |
|
|
Depreciation |
||
At 1 January 2023 |
|
|
Charge for the year |
|
|
Revaluation |
( |
( |
At 31 December 2023 |
|
|
Carrying amount |
||
At 31 December 2023 |
|
|
At 31 December 2022 |
|
|
Company
Plant and machinery |
Total |
|
Cost or valuation |
||
At 1 January 2023 |
|
|
Additions |
|
|
At 31 December 2023 |
|
|
Depreciation |
||
At 1 January 2023 |
|
|
Charge for the year |
|
|
At 31 December 2023 |
|
|
Carrying amount |
||
At 31 December 2023 |
|
|
At 31 December 2022 |
|
|
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Investments |
Company
31.12.23 |
31.12.22 |
|
Investments in subsidiaries |
|
|
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
|
2023 |
2022 |
|||
Subsidiary undertakings |
||||
|
Sarajevo, Danijela Ozme No. 3, BiH Bosnia |
|
|
|
|
Sarajevo, Danijela Ozme No. 3. BiH Bosnia |
|
|
|
|
Friedrich-Ebert-Anlage 35-37, 60327 Frankfurt am Main Germany |
|
|
|
Subsidiary undertakings |
Code Line Solutions d.o.o. The principal activity of Code Line Solutions d.o.o. is |
Energy Trading Company d.o.o. The principal activity of Energy Trading Company d.o.o. is |
Alfaenergie Beratung und Vermittlung GmbH The principal activity of Alfaenergie Beratung und Vermittlung GmbH is |
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Debtors |
Group |
Company |
||||
Note |
31.12.23 |
31.12.22 |
31.12.23 |
31.12.22 |
|
Trade debtors |
|
|
|
|
|
Amounts owed by related parties |
|
|
|
|
|
Other debtors |
|
|
( |
|
|
Prepayments and accrued income |
|
|
|
|
|
Deferred tax assets |
- |
|
- |
|
|
Income tax asset |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
Group |
Company |
|||
31.12.23 |
31.12.22 |
31.12.23 |
31.12.22 |
|
Cash on hand |
|
|
|
|
Cash at bank |
|
|
|
|
|
|
|
|
Creditors |
Group |
Company |
||||
Note |
31.12.23 |
31.12.22 |
31.12.23 |
31.12.22 |
|
Due within one year |
|||||
Trade creditors |
|
|
|
|
|
Amounts due to related parties |
|
|
|
|
|
Social security and other taxes |
|
|
|
|
|
Pension costs |
|
|
|
|
|
Other payables |
|
|
|
|
|
Accruals and deferred income |
|
|
|
|
|
|
|
|
|
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Obligations under leases and hire purchase contracts |
Group
Operating leases
The total of future minimum lease payments is as follows:
31.12.23 |
31.12.22 |
|
Not later than one year |
|
|
Later than one year |
|
|
|
|
Company
Operating leases
The total of future minimum lease payments is as follows:
31.12.23 |
31.12.22 |
|
Not later than one year |
|
|
Later than one year |
- |
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £90,000 (2022 - £90,000)
Provisions for liabilities |
Group
Deferred tax |
Total |
|
At 1 January 2023 |
|
|
Increase (decrease) in existing provisions |
( |
( |
At 31 December 2023 |
|
|
|
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
16 |
Provisions for liabilities (continued) |
Company
Deferred tax |
Total |
|
At 1 January 2023 |
|
|
Decrease in existing provisions |
( |
( |
At 31 December 2023 |
|
|
|
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £118,116 (2022 - £
Contributions totalling £
Share capital |
Allotted, called up and fully paid shares
31.12.23 |
31.12.22 |
|||
No. |
£ |
No. |
£ |
|
|
|
120 |
|
120 |
|
|
120 |
|
120 |
|
|
21 |
|
21 |
|
|
|
|
Alfa Energy Limited
Notes to the Financial Statements for the Year Ended 31 December 2023 (continued)
Dividends |
Interim dividends paid
31.12.23 |
31.12.22 |
|||
Interim dividend of £Nil (2022 - £ |
- |
|
||
Interim dividend of £Nil (2022 - £ |
- |
|
||
- |
|
Related party transactions |
Company
Summary of transactions with other related parties
Parent and ultimate parent undertaking |
The company's immediate parent is Edison Energy LLC, incorporated in Delaware with registered number 4165046. Edison Energy LLC acquired the company on 4 October 2022.
The ultimate parent is Edison International, incorporated in the USA.