Stink Limited
Annual Report and Financial Statements
For the year ended 31 December 2023
Company Registration No. 03439238 (England and Wales)
Stink Limited
Company Information
Directors
D Bergmann
B I Powell
I Zacharias
D M Forman
Secretary
E Lotter
Company number
03439238
Registered office
64-66 Redchurch Street
London
England
E2 7DP
Auditor
Moore Kingston Smith LLP
Charlotte Building
17 Gresse Street
London
W1T 1QL
Business address
64-66 Redchurch Street
London
United Kingdom
E2 7DP
Stink Limited
Contents
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 25
Stink Limited
Strategic Report
For the year ended 31 December 2023
Page 1

The directors present the strategic report for the year ended 31 December 2023.

Fair review of the business

Since the company was founded in 1997, Stink Ltd has grown extensively. The company is expert in combining film, products, social media and interactive experiences to create the unexpected for brands.

 

The company operates in a highly competitive market where there is an ongoing risk of losing creative talent to competitors. The company manages this risk by having in place comprehensive contracts with fixed terms and notice periods wherever practical.

 

The company continues to have high level of cash reserves post year end and the directors have prepared profit and cashflow forecasts which show that the Company has sufficient cash to trade for a period of 12 months from the signing of these accounts. The accounts have therefore been prepared on a going concern basis.

 

The company's key measurement of the effectiveness of its operations is the margin of operating profit, which improved from a loss of £814,188 in 2022 to a profit of £509,260 in 2023.

 

The balance sheet on page nine shows the net asset position at the year-end increasing to £2,564,716 from £313,331 in 2022

 

The business has good credit controls in place to enable it to maintain a cash positive working capital position. These KPIs are monitored on a monthly basis as part of the management review process.

 

Financial risk management

Stink Limited's operations expose it to limited financial risks that include credit risk and foreign exchange risk. Given the size of Stink Limited, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the board. The policies set by the board of directors are implemented by the company's finance departments.

 

Credit risk

The company has implemented policies that require appropriate credit verification procedures on potential customers.

Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

 

Foreign exchange risk

The company actively manages foreign exchange rate risk.

 

 

 

On behalf of the board

D Bergmann
Director
10 February 2025
Stink Limited
Directors' Report
For the year ended 31 December 2023
Page 2

The directors present their annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the company continued to be that of a TV production company. There have been no significant changes in the company's principal activities in the period under review. The directors are not aware, at the date of this report, of any likely changes in the company's activities in the forthcoming year.

Results and dividends

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £1,500,000 (2022; £3,770,833). The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

D Bergmann
B I Powell
I Zacharias
D M Forman
Auditor

In accordance with the company's articles, a resolution proposing that Moore Kingston Smith LLP be reappointed as auditor of the company will be put at a General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
D Bergmann
Director
10 February 2025
2025-02-10
Stink Limited
Directors' Responsibilities Statement
For the year ended 31 December 2023
Page 3

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Stink Limited
Independent Auditor's Report
To the Members of Stink Limited
Page 4
Opinion

We have audited the financial statements of Stink 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 notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

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.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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.

 

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.

Stink Limited
Independent Auditor's Report (Continued)
To the Members of Stink Limited
Page 5

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

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:

 

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement, 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.

Stink Limited
Independent Auditor's Report (Continued)
To the Members of Stink Limited
Page 6
Auditor's 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.

 

As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

 

 

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.

 

 

Stink Limited
Independent Auditor's Report (Continued)
To the Members of Stink Limited
Page 7

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

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.

The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.

Our approach was as follows:

 

 

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

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.

Joanna Cosgrove
Senior Statutory Auditor
for and on behalf of Moore Kingston Smith LLP
10 February 2025
Chartered Accountants
Statutory Auditor
Charlotte Building
17 Gresse Street
London
W1T 1QL
Stink Limited
Statement of Comprehensive Income
For the year ended 31 December 2023
Page 8
2023
2022
Notes
£
£
Turnover
3
29,279,193
20,732,070
Cost of sales
(24,974,280)
(17,506,999)
Gross profit
4,304,913
3,225,071
Administrative expenses
(4,584,425)
(4,656,392)
Other operating income
788,772
617,133
Operating profit/(loss)
4
509,260
(814,188)
Interest receivable and similar income
7
3,753,094
3,845,667
Interest payable and similar expenses
8
(196,392)
(33,797)
Fair value gains and losses
9
(62,401)
-
Profit before taxation
4,003,561
2,997,682
Tax on profit
10
(193,986)
(4,043)
Profit for the financial year
3,809,575
2,993,639
Other comprehensive income
Currency translation loss taken to retained earnings
(58,190)
(14,849)
Total comprehensive income for the year
3,751,385
2,978,790

The Profit and Loss Account has been prepared on the basis that all operations are continuing operations.

Stink Limited
Balance Sheet
As at 31 December 2023
Page 9
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
13
54,819
59,911
Investments
14
1,017,816
1,080,217
1,072,635
1,140,128
Current assets
Debtors
16
8,691,766
7,016,241
Cash at bank and in hand
3,763,293
4,927,610
12,455,059
11,943,851
Creditors: amounts falling due within one year
17
(10,962,978)
(12,770,648)
Net current assets/(liabilities)
1,492,081
(826,797)
Net assets
2,564,716
313,331
Capital and reserves
Called up share capital
20
9,803
9,803
Share premium account
29,882
29,882
Capital redemption reserve
1,927
1,927
Other reserves
2,903
2,903
Profit and loss reserves
2,520,201
268,816
Total equity
2,564,716
313,331
The financial statements were approved by the board of directors and authorised for issue on 10 February 2025 and are signed on its behalf by:
D  Bergmann
Director
Company Registration No. 03439238
Stink Limited
Statement of Changes in Equity
For the year ended 31 December 2023
Page 10
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
£
Balance at 1 January 2022
9,049
29,882
1,927
2,903
1,060,859
1,104,620
Year ended 31 December 2022:
Profit for the year
-
-
-
-
2,993,639
2,993,639
Other comprehensive income:
Currency translation differences
-
-
-
-
(14,849)
(14,849)
Total comprehensive income for the year
-
-
-
-
2,978,790
2,978,790
Issue of share capital
20
754
-
0
-
-
-
754
Dividends
-
-
-
-
(3,770,833)
(3,770,833)
Balance at 31 December 2022
9,803
29,882
1,927
2,903
268,816
313,331
Year ended 31 December 2023:
Profit for the year
-
-
-
-
3,809,575
3,809,575
Other comprehensive income:
Currency translation differences
-
-
-
-
(58,190)
(58,190)
Total comprehensive income for the year
-
-
-
-
3,751,385
3,751,385
Dividends
-
-
-
-
(1,500,000)
(1,500,000)
Balance at 31 December 2023
9,803
29,882
1,927
2,903
2,520,201
2,564,716
Stink Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 11
1
Accounting policies
Company information

Stink Limited is a private company limited by shares incorporated in England and Wales. The registered office is 64-66 Redchurch Street, London, England, E2 7DP.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

 

Stink Limited is a subsidiary of Stink Holdings Limited and the results of Stink Limited are included in the consolidated financial statements of Stink Holdings Limited which are available from 4th Floor, St Paul’s Gate, 22-24 New Street, St Helier, Jersey, JE1 4TR.

 

1.2
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue to trade in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 12
1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

Amounts invoiced in excess of income are included within deferred income. Income recognised in excess of amounts invoiced is included within accrued income.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.5
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Development costs
10 years
1.6
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Over the period of the lease
Plant and equipment
2-6 years straight line
Fixtures and fittings
2-6 years straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 13
1.7
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.8
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.9
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 14
1.10
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 15
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.11
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.12
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 16
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.14
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.15
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 17
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Project profitability

The directors are required to review ongoing projects not completed as at 31 December 2022 to ensure that revenue is correctly recognised based on the stage of completion. The directors estimate the revenue to be recognised based on known costs to date and estimated costs to completion.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
TV production
29,279,193
20,732,070
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
20,576,974
16,039,080
Europe
2,553,260
1,876,550
Rest of the World
6,148,959
2,816,440
29,279,193
20,732,070
2023
2022
£
£
Other significant revenue
Interest income
167,609
92,712
Dividends received
3,585,485
3,752,955
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 18
4
Operating profit/(loss)
2023
2022
Operating profit/(loss) for the year is stated after charging:
£
£
Exchange losses
19,660
212,848
Research and development costs
-
155
Fees payable to the company's auditor for the audit of the company's financial statements
74,999
60,482
Depreciation of owned tangible fixed assets
15,890
14,224
Impairment of intangible assets
-
0
8,185
Operating lease charges
317,611
321,202
5
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Directors
3
3
Admin
11
11
Production
8
5
Sales
3
4
Total
25
23

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,750,149
2,680,781
Social security costs
256,882
295,907
Pension costs
66,942
70,562
3,073,973
3,047,250
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
807,655
1,111,075
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
6
Directors' remuneration
(Continued)
Page 19
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
450,981
419,188
Company pension contributions to defined contribution schemes
1,250
7,117
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
167,609
92,712
Income from fixed asset investments
Income from shares in group undertakings
3,585,485
3,752,955
Total income
3,753,094
3,845,667
8
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
196,392
32,181
Other interest
-
0
1,616
196,392
33,797
9
Fair value gains and losses
2023
2022
£
£
Other gains and losses
(62,401)
-
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
102,574
-
0
Foreign current tax on profits for the current period
91,412
4,043
Total current tax
193,986
4,043
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
10
Taxation
(Continued)
Page 20

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
4,003,561
2,997,682
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
941,659
569,560
Tax effect of expenses that are not deductible in determining taxable profit
59,971
(52,745)
Double tax relief
(55,515)
-
0
Group relief
-
0
198,899
Depreciation on assets not qualifying for tax allowances
(215)
(4,208)
Amortisation on assets not qualifying for tax allowances
-
0
1,555
Dividend income
(843,326)
(713,061)
Foreign tax
91,412
4,043
Taxation charge for the year
193,986
4,043
11
Impairments

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

2023
2022
Notes
£
£
In respect of:
Intangible assets
12
-
0
8,185
Investments in subsidiaries
14
62,401
-
Recognised in:
Administrative expenses
-
8,185
Amounts written off investments
62,401
-

The impairment losses in respect of financial assets are recognised in other gains and losses in the profit and loss account.

Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 21
12
Intangible fixed assets
Development costs
£
Cost
At 1 January 2023 and 31 December 2023
186,002
Amortisation and impairment
At 1 January 2023 and 31 December 2023
186,002
Carrying amount
At 31 December 2023
-
0
At 31 December 2022
-
0

More information on impairment movements in the year is given in note 11.

13
Tangible fixed assets
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Total
£
£
£
£
Cost
At 1 January 2023
261,515
210,001
74,645
546,161
Additions
-
0
12,205
1,915
14,120
Disposals
-
0
(1,833)
-
0
(1,833)
Exchange adjustments
(2,236)
-
0
(491)
(2,727)
At 31 December 2023
259,279
220,373
76,069
555,721
Depreciation and impairment
At 1 January 2023
244,407
176,421
65,422
486,250
Depreciation charged in the year
2,205
12,972
713
15,890
Exchange adjustments
(949)
-
0
(289)
(1,238)
At 31 December 2023
245,663
189,393
65,846
500,902
Carrying amount
At 31 December 2023
13,616
30,980
10,223
54,819
At 31 December 2022
17,108
33,580
9,223
59,911
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 22
14
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
15
1,017,816
1,080,217
Movements in fixed asset investments
Shares in subsidiaries
£
Cost or valuation
At 1 January 2023
1,080,217
Disposals
(62,401)
At 31 December 2023
1,017,816
Carrying amount
At 31 December 2023
1,017,816
At 31 December 2022
1,080,217
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 23
15
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered
Class of
% Held
office
shares held
Direct
Indirect
OOO Stink
Office 401 - Bersenevskiy, 2/1, 119072,
Moscow, Russia
Ordinary shares
100.00
-
Stink (Shanghai) Co., Ltd
2nd Floor, No. 18, Lane 433, Xiang Yang
South Road, Shanghai, China 200031
Ordinary shares
100.00
-
Stink CZ, s.r.o
Voskovcova 1130/26, Hlubocepy, 152 00
Praha
Ordinary shares
100.00
-
Stink Digital Ltd
5-23 Old Street, London EC1V 9HL, United
Kingdom
Ordinary shares
80.00
-
Stink Digital USA LLC
160 Van Brunt Street, 3rd Floor, Brooklyn
11231-1317
Ordinary shares
-
80.00
Stink GmbH
Potsdamer Str. 96 10785 Berlin, Germany
Ordinary shares
100.00
-
Stink Holding Inc
160 Greentree Drive, #101, Dover, Kent,
County, Delaware 19901, USA
Ordinary shares
100.00
-
Stink Hong Kong, Ltd
Suite 1201, Tower 2, The Gateway, 25 Canton
Road, Tsimshatsui, Kowloon, Hong Kong
Ordinary shares
100.00
-
Stink LLC
3583 Hayden ave Culver City, CA 90232, USA
Ordinary shares
-
100.00
Stink S.A.S.
11 Rue du Perche 75003, Paris, France
Ordinary shares
100.00
-
Stink SP Producao de
Filmes LTDA*
Rua Bento de Andrade, 395 Jardin Paulista,
Sao Paulo 04503-001, Brazil
Ordinary shares
49.00
-
Savage.tv, s.r.o
Praha 5 - Hlubocepy, Krizeneckeho namesti, 322/5, PSC 15200, Czech Republic
Ordinary shares
-
100.00
Stink Studios Shanghai Co. Ltd
NO. 1003, Wuding ROad, Jingan District, Shanghai, China
Ordinary shares
-
80.00
Front Productions, LLC
1 Dock 72 Way, Brookly, NY 11205, USA
Ordinary shares
-
80.00

* The group has legal ownership of 49% in Stink SP with the future right to acquire a further 7% through options exercisable on demand.

16
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
588,964
1,980,056
Amounts owed by group undertakings
4,726,088
1,936,921
Other debtors
421,167
520,522
Prepayments and accrued income
2,955,547
2,578,742
8,691,766
7,016,241
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 24
17
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
18
403,380
61,760
Trade creditors
516,374
600,222
Amounts owed to group undertakings
5,950,119
5,863,110
Corporation tax
159,691
82,664
Other taxation and social security
666,547
483,721
Other creditors
23,678
14,938
Accruals and deferred income
3,243,189
5,664,233
10,962,978
12,770,648
18
Loans and overdrafts
2023
2022
£
£
Bank overdrafts
403,380
61,760
Payable within one year
403,380
61,760
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
66,942
70,562

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of £1 each
8,295
8,295
8,295
8,295
Ordianry B shares of £1 each
754
754
754
754
Ordinary C shares of £1 each
252
252
252
252
Ordinary D shares of £1 each
251
251
251
251
Ordinary E shares of £1 each
251
251
251
251
9,803
9,803
9,803
9,803
Stink Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
20
Share capital
(Continued)
Page 25

On 19 October 2022, 252 ordinary C shares, 251 ordinary D shares and 251 ordinary E shares all of £1 each were issued at par.

 

Ordinary A to C shares have full voting rights attached to them.

 

21
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
320,978
481,467
Between two and five years
-
0
320,978
320,978
802,445
22
Related party transactions

During the year, Stink Limited received management fees of £441,846 (2022: £442,548) and recharged rent of £218,340 (2022: £218,340) to fellow group undertakings. During the year Stink Limited purchased services of £22,299 (2022: £83,076) from fellow group undertakings. At the year end, the company was owed £2,214,598 (2022: £944,031) from fellow group undertakings and owed £2,342,964 (2022: £1,106,446) to fellow group undertakings.

 

During the year, Stink Limited made purchases of £nil (2022: £409,171) from entities controlled by directors of the company. At the year end the company owed £nil (2022: £174,171) to entities controlled by directors of the company.

 

During the year, Stink Limited made purchases of £21,092 (2022: £21,978) from directors of other group companies. At the year end an amount the company owed £21,092 (2022: £21,978) to the directors of other group companies.

 

There were no balances written off during the year in respect of any of the above balances.

 

At the year end, there was a balance included in other creditors of £292,479 (2022: £185,537) owed to D Bergmann, a director of the company.                                    

 

23
Ultimate controlling party

The immediate parent company of Stink Limited is Stink Holdings Limited, a company incorporated in Jersey whose registered office is 4th Floor St Paul's Gate 22 - 24 New Street, St Helier, Jersey, JE1 4TR.

 

The ultimate parent company of Stink Limited is 2020 Group Limited, a company incorporated in Jersey whose registered office is 4th Floor St Paul's Gate 22 - 24 New Street, St Helier, Jersey, JE1 4TR.

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