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Registered number: SC653985










SOLVED BY AI LIMITED










FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2024

 
SOLVED BY AI LIMITED
REGISTERED NUMBER: SC653985

STATEMENT OF FINANCIAL POSITION
AS AT 31 JANUARY 2024

2024
2023
Note
£
£

Fixed assets
  

Intangible assets
 4 
1,877,971
1,878,234

Tangible assets
 5 
3,338
8,366

  
1,881,309
1,886,600

Current assets
  

Debtors: amounts falling due within one year
 6 
373,566
632,886

Cash at bank and in hand
 7 
14,234
10,803

  
387,800
643,689

Creditors: amounts falling due within one year
 8 
(1,183,975)
(1,526,409)

Net current liabilities
  
 
 
(796,175)
 
 
(882,720)

Total assets less current liabilities
  
1,085,134
1,003,880

Provisions for liabilities
  

Other provisions
 9 
(466,805)
(714,548)

  
 
 
(466,805)
 
 
(714,548)

Net assets
  
618,329
289,332


Capital and reserves
  

Called up share capital 
  
100
100

Profit and loss account
  
618,229
289,232

  
618,329
289,332


Page 1

 
SOLVED BY AI LIMITED
REGISTERED NUMBER: SC653985
    
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 JANUARY 2024

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.

The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 28 January 2025.






I. C. Hogg
Director

The notes on pages 4 to 13 form part of these financial statements.

Page 2

 
SOLVED BY AI LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 February 2022
100
51,258
51,358


Comprehensive income for the year

Profit for the year
-
215,803
215,803
Total comprehensive income for the year
-
215,803
215,803


Contributions by and distributions to owners

Credit to equity for equity settled share-based payments
-
22,171
22,171


Total transactions with owners
-
22,171
22,171



At 1 February 2023
100
289,232
289,332


Comprehensive income for the year

Profit for the year
-
279,139
279,139
Total comprehensive income for the year
-
279,139
279,139


Contributions by and distributions to owners

Credit to equity for equity settled share-based payments
-
49,858
49,858


Total transactions with owners
-
49,858
49,858


At 31 January 2024
100
618,229
618,329


The notes on pages 4 to 13 form part of these financial statements.

Page 3

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

1.


General information

Solved BY AI Limited is a private company limited by shares incorporated in Scotland,  The registered office is Scotia Bank House, 6 South Charlotte Street, Edinburgh, Scotland, EH2 4AW.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The following principal accounting policies have been applied:

 
2.2

Going concern

During the financial year the Company depended on the support of its parent Company The Work Tech Group Limited and its fellow subsidiary Company, SWT Software Limited, to meet its day to day working capital requirements. On 6 January 2025 the Company demerged from the Group and raised £935,400 from shareholders of the Work Tech Group as well as new investors to fund an initial expansion of the business. Further funding will be required in the next 12 months, which the directors are confident will be forthcoming.
In addition the Directors of SWT Software Limited have confirmed that they will continue to be supportive of Solved BY AI Limited for the foreseeable future and will not seek repayment of a loan until the Company is sufficiently cash generative to support the payments. Accordingly, the directors believe it is appropriate to prepare the financial statements on the going concern basis.

 
2.3

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.

  
2.4

Revenue

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

Page 4

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)

 
2.5

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight-line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

 
2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of comprehensive income in the same period as the related expenditure.

 
2.7

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 reporting 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.

Page 5

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)

 
2.8

Taxation

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 reporting date in the countries where the Company operates and generates income.


 
2.9

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 Amortisation is provided on the following bases:

Software development costs
-
20%
to 33 % straight line

 
2.10

Tangible fixed assets

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

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

Depreciation is provided on the following basis:

Office equipment
-
25 % or 33 % straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Page 6

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)

 
2.12

Cash and cash equivalents

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

 
2.13

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.14

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.


3.


Employees

The average monthly number of employees, including directors, during the year was 16 (2023 - 22).

Page 7

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

4.


Intangible assets




Software develop-  ment costs

£



Cost


At 1 February 2023
2,693,361


Additions
795,625



At 31 January 2024

3,488,986



Amortisation


At 1 February 2023
815,127


Charge for the year on owned assets
795,888



At 31 January 2024

1,611,015



Net book value



At 31 January 2024
1,877,971



At 31 January 2023
1,878,234



Page 8

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

5.


Tangible fixed assets





Office equipment

£



Cost or valuation


At 1 February 2023
21,785



At 31 January 2024

21,785



Depreciation


At 1 February 2023
13,419


Charge for the year on owned assets
5,028



At 31 January 2024

18,447



Net book value



At 31 January 2024
3,338



At 31 January 2023
8,366


6.


Debtors

2024
2023
£
£


Trade debtors
11,445
-

Amounts owed by group undertakings
100
63,572

Other debtors
275,550
501,642

Prepayments and accrued income
86,471
67,672

373,566
632,886



7.


Cash and cash equivalents

2024
2023
£
£

Cash at bank and in hand
14,234
10,803

14,234
10,803


Page 9

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

8.


Creditors: Amounts falling due within one year

2024
2023
£
£

Trade creditors
62,650
11,880

Amounts owed to group undertakings
1,053,232
1,433,257

Other taxation and social security
41,553
26,365

Other creditors
9,158
5,795

Accruals and deferred income
17,382
49,112

1,183,975
1,526,409



9.


Provisions





Government grants

£





At 1 February 2023
714,548


Charged to profit or loss
(247,743)



At 31 January 2024
466,805

Page 10

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

10.


Share-based payments

The parent Company, The Work Tech Group Ltd has granted Enterprise Management Incentive (EMI) options.
Directors and staff are granted options at the parent company's discretion. EMI options have been granted in four tranches.
A tranche of options of 289 shares was granted to staff members on 30 August 2019 and has a 3 year vesting period to 30 August 2022. The estimated fair value of each option granted is £433.57. The estimated fair value was calculated with reference to the valuation agreed with HMRC. If any individual leaves the company before the exercise of their options then their options lapse.
There are no performance conditions attaching to the scheme. The exercise price is £1,734.28 per share.
A tranche of options of 337 shares was granted to staff members on 30 November 2020 and has a 3 year vesting period to 30 November 2023. The estimated fair value of each option granted is £294.28. The estimated fair value was calculated with reference to the valuation agreed with HMRC. If any individual leaves the company before the exercise of their options then their options lapse.
There are no performance conditions attaching to the scheme. The exercise price is £1,185.80 per share.
A tranche of options of 646 shares was granted to staff members on 27 October 2021 and has a 3 year vesting period to 26 October 2024. The estimated fair value of each option granted is £289.30. The estimated fair value was calculated with reference to the valuation agreed with HMRC. If any individual leaves the company before the exercise of their options then their options lapse.
There are no performance conditions attaching to the scheme. The exercise price is £1,112.68 per share.
A tranche of options of 302 shares was granted to staff members on 5 January 2023 and has a 3 year vesting period to 4 January 2026. The estimated fair value of each option granted is £479.44. The estimated fair value was calculated with reference to the valuation agreed with HMRC. If any individual leaves the company before the exercise of their options then their options lapse.
There are no performance conditions attaching to the scheme. The exercise price is £1,917.77 per share.

Weighted average exercise price (pence)
2024
Number
2024
Weighted average exercise price
(pence)
2023
Number
2023

Outstanding at the beginning of the year

1,344.69

1,128

1,225.24
 
1,097
 
Granted during the year


-

1,917.77
 
302
 
Forfeited during the year

1,391.12

(220)

1,245.44
 
(130)
 
Expired during the year

1,185.80

(220)

1,734.28
 
(141)
 
Outstanding at the end of the year
1,380.65

688

1,344.69
 
1,128
 



Page 11

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

10.Share-based payments (continued)


During the year, the Company recognised total share-based payment expenses of £49,858 (2023 - £22,171) which related to equity settled share based payment transactions.
This is on the basis that the EMI options have been granted solely for the benefit of the Companys' employees.


11.


Commitments under operating leases

At 31 January 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2024
2023
£
£


Not later than 1 year
27,878
20,192

Later than 1 year and not later than 5 years
48,787
-

76,665
20,192


12.Other financial commitments

A bank loan in SWT Software Limited, a fellow subsidiary, is secured by a guarantee from the Secretary of State for Business, Energy & Industrial Strategy for 80% of the loan and a cross company guarantee from all group companies, including Solved BY AI Limited.  The value of the loan outstanding as at 31 January 2024 was £907,873 (2023 - £1,000,000)


13.


Related party transactions

The Company has taken advantage of the exemption under paragraph 33.1A of FRS 102 and has not disclosed transactions with other wholly owned group companies.


14.


Controlling party

The parent Company of Solved BY AI Limited for the whole of the year ended 31 January 2024 was The Work Tech Group Ltd, a Company which was incorporated in the British Virgin Islands, and as a result is required to maintain a registered office in that territory.
The Work Tech Group Ltd is a UK resident by reason of the central management and control of the company taking place in the United Kingdom.
On 6 January 2025 the Company demerged from The Work Tech Group Ltd and the parent company became Solved BY AI Holding Company Limited, a company incorporated in England and Wales.

Page 12

 
SOLVED BY AI LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

15.


Auditors' information

The auditors' report on the financial statements for the year ended 31 January 2024 was unqualified.

In their report, the auditors emphasised the following matter without qualifying their report:

Material uncertainty related to going concern
We draw attention to note 2.2 in the financial statements, which indicates that further funding from investors will be required within the next 12 months. As stated in note 2.2, these events or conditions, along with the other matters as set forth in note 2.2, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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. Our evaluation of the directors' assessment of the Company's ability to continue to adopt the going concern basis of accounting included a detailed review of current trading results and projections prepared by the directors.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

The audit report was signed on 28 January 2025 by Andrew McCall (Senior statutory auditor) on behalf of Langtons Professional Services Limited.

 
Page 13