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Registered number:10313109









ERWIN TECHNOLOGIES UK LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
COMPANY INFORMATION


Director
A P Lyne 




Company secretary
Corporation Service Company (UK) Limited



Registered number
10313109



Registered office
C/O Corporation Service Company (UK) Limited, 5 Churchill Place
10th Floor

London

United Kingdom

E14 5HU




Independent auditors
Feltons Chartered Accountants and Statutory Auditor

1 The Green

Richmond

Surrey

TW9 1PL





 
ERWIN TECHNOLOGIES UK LIMITED
 

CONTENTS



Page
Strategic report
 
1 - 3
Director's report
 
4 - 6
Independent auditors' report
 
7 - 10
Statement of comprehensive income
 
11
Balance sheet
 
12
Statement of changes in equity
 
13 - 14
Notes to the financial statements
 
15 - 27


 
ERWIN TECHNOLOGIES UK LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their Strategic Report for the year ended 31 December 2023.

Business review
 
Erwin Technologies UK Limited provided Enterprise Architectural software solutions that are complementary to the US based parent's products. The principal activities of the company included: the design and development of computer software; the sale of computer software and the provision of related consultancy and support services. During 2021 new computer software sales and the provision of related consultancy and support services activities were transferred to a fellow group company. 
Erwin Technologies UK Limited's turnover is now derived from the provision of related consultancy and support services on older sales prior to the transfer and from income earned from the design and development of computer software from other group companies.
Over 350 corporations worldwide actively use the Casewise toolset to help document, model, articulate, visualise, communicate, measure their business processes, their business architectures and their systems. Helping large corporations understand better their operations, and how they can improve efficiency and effectiveness of those operations is at the heart of our DNA.
For most organisations their ability to, compete, execute on their customer promises of time and quality, deliver an adequate return on their capital, provide confidence on their ability to comply, is totally dependent on the way their processes execute. Organisational processes are the key to organisational excellence. We provide many of our customers, the ability to draw and to test the road map of their journey to operational excellence, which is why we are critical to the success of the corporate world. 
Turnover for the year ended 31 December 2023 increased to £1,274,389 from £943,210 in the previous year.  
The profit for the financial year ended 31 December 2023 increased to £2,268,353 from £147,556 in the previous year. This was mainly due to the write back of an amount of £1,344,229 relating to a correction of a historical intra group transfer of intangible assets to a fellow group subsidiary company, which resulted in an excessive amount of amortisation being charged to the company in previous accounting periods.
Total net assets as at 31 December 2023 increased to £2,717,667 from £449,314 in the previous year.
At this time, the future plans of the entity is to continue as a going concern for the foreseeable future, which management will continue to evaluate on an ongoing basis.

Page 1

 
ERWIN TECHNOLOGIES UK LIMITED
 

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

Principal risks and uncertainties
 
The management of the business and the nature of the company's strategy are subject to a number of risks. The  director of the business set out below the principal risks of the company:
A proportion of turnover related to sales outside the UK. As a company, we were therefore exposed to fluctuations in foreign currency. The director continually monitor this but at present do not believe that this risk necessitates the use of forward exchange contracts or other financial instruments, especially given that the sale of computer software and the provision of related consultancy and training services activities were transferred to a fellow group company.
As the company primarily operates to support other group companies, its main operating risk is managing operating expenses for the entity. The profit or loss of the entity can rise and fall depending on the company's ability to effectively manage its operating expenses. The BPA, EA and Compliance markets which the other  group companies operate in are highly competitive with downward pressures on pricing. Policies of constant price monitoring and ongoing market research are in place to mitigate these risks.
The Clearlake Capital Group, L.P. group, of which the company is a member of, is pursuing a strategy of providing end to end solutions in order to meet the needs of customers and this is a key part of the company’s risk mitigation approach.
The company uses a range of information technology and decision support systems for provision of key services, control procedures and financial management. These systems are constantly reviewed and updated to meet the needs of the company. Business continuity and disaster recovery planning is regularly assessed and tested to ensure the company is adequately resourced and maintains an appropriately robust environment including preventative processes on cybercrime. 
The company's operations are not exposed to significant financial risks.
The company is exposed to any changes in UK taxation rates or legislation changes which could increase the company's effective tax rate.
The company's operations are principally funded through group loan arrangements, and as such the company is not exposed directly to external risk factors such as liquidity and interest rate risk.
The company has no employees and is therefore not subject to talent management or recruitment risk.
The Director is of an opinion that thorough risk management processes are in place to monitor and mitigate such risks.

Financial key performance indicators
 
The director considers turnover and operating profit to be the key performance indicators for the company.

 
Page 2

 
ERWIN TECHNOLOGIES UK LIMITED
 

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


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



A P Lyne
Director

Date: 17 February 2025

Page 3

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The director presents his report and the financial statements for the year ended 31 December 2023.

Director's responsibilities statement

The director is responsible for preparing the Strategic report, the Director's report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’. Under company law the director must not approve the financial statements unless he is 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 director is required to:


select suitable accounting policies and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The director is responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable him to ensure that the financial statements comply with the Companies Act 2006He is 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.

Results and dividends

The profit for the year, after taxation, amounted to £2,268,353 (2022 - £147,556).

There were no dividends paid for the year ended 31 December 2023 (2022: £nil).

Director

The director who served during the year was:

A P Lyne 

Future developments

The company is reliant on other group companies who operate in highly competitive markets. These companies have confirmed their commitment to continuing to develop their own products and make suitable acquisitions where appropriate for the foreseeable future to remain competitive.
Due to its profile, the director believes the company is shielded from any general downturns in the market.

Page 4

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial instruments

The company uses various financial instruments including intercompany balances, cash and various items that arise from its operations. The main purpose of the financial instruments is to raise finance for the company’s operations.
The main risks arising from the company’s financial instruments are liquidity risk and credit risk. The directors review and agree policies for managing each of these risks and they are summarised below.
Liquidity risk
The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs. The company policy throughout the period has been to ensure continuity of funding using a mixture of long term and short term debt finance as well as intercompany funding. 
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument, leading to a financial loss. Regular management reviews are made to assess the recoverability of amounts and provision made accordingly.
The carrying amount of financial assets represents the maximum exposure. No financial assets are considered to be past due nor impaired.

Matters covered in the Strategic Report

The strategic report contains the business review, principal risks and uncertainties and key performance indicators.

Disclosure of information to auditors

The director at the time when this Director's report is approved has confirmed that:
 
so far as  is aware, there is no relevant audit information of which the Company's auditors are unaware, and

 has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Page 5

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Post balance sheet events

The director, after making enquiries and having regard to the company’s financial position, the company’s expected trading performance and cash flows, have a reasonable expectation that the company has adequate resources to continue operating for the foreseeable future. Therefore, these financial statements have been prepared on a going concern basis. 
The company meets its day-to-day working capital requirements through its cash inflows from operations and intercompany debt. 
In arriving at its conclusion, the director has taken account of the level of intercompany financing and cash resources which the company maintains to enable it to meet its working capital requirements.
The director has obtained letters of support from group companies, that it will receive financial support to meet any liabilities that will fall due for a period of at least 12 months from the date of approval of these financial statements. For this reason, the going concern basis continues to be adopted in preparing the financial statements.
The director will continue to monitor any significant adverse changes to cash flows, any adverse indicators in respect of the carrying value of assets and additional liabilities and take appropriate measures to address these matters, if required. 
There have been no significant events affecting the company since the financial year end that require disclosure in the financial statements.

Auditors

The auditorsFeltons Chartered Accountants and Statutory Auditorwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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





A P Lyne
Director

Date: 17 February 2025

Page 6

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ERWIN TECHNOLOGIES UK LIMITED
 

Disclaimer of Opinion


We were engaged to audit the financial statements of Erwin Technologies UK Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’ (United Kingdom Generally Accepted Accounting Practice).


We do not express an opinion on the accompanying financial statements of the company. Because of the significance of the matter described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.


Basis for disclaimer of opinion


Our audit report for the prior year included a disclaimer of opinion concerning the deferred revenue creditor and the related completeness of income recognised in the statement of comprehensive income. This was due to a lack of available evidence, resulting from the introduction of a new accounting system in a prior period and detailed information from the previous accounting system not being available. We have not been able to obtain any further evidence on the opening deferred revenue creditor during the current period audit. 
Due to a continued lack of available evidence, we were unable to conduct a detailed review or confirm the accuracy of the deferred revenue creditor at the end of the current period and consequently we were unable to verify the completeness of the current period income recognised in the statement of comprehensive income in the current year.  
Our audit opinion for the current period's financial statements has therefore been modified due to the potential impact of these issues on the figures.













Page 7

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ERWIN TECHNOLOGIES UK LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and  our Auditors' report thereon.  The director is 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.
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:
• We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
• We obtained an understanding of laws and regulations that could reasonably be expected to have a material effect on  the  financial statements through  discussion with management and those charged with governance, including financial reporting and taxation legislation. We considered that extent of compliance with those laws and regulations as part of our procedures on the related financial statement items.
• We inquired of management and those charged with governance as to any known instances of non- compliance or suspected non-compliance with laws and regulations. We remained alert to any indications of non-compliance throughout the audit.
• We addressed the risk of fraud through management override by reviewing the appropriateness of a sample of journal entries and other adjustments; assessing whether the judgements made in making key accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business that we come across throughout 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 examination should not be relied upon to disclose all such material misstatements or frauds, errors or instances of non-compliance as may exist.
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.





Page 8

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ERWIN TECHNOLOGIES UK LIMITED (CONTINUED)


Opinion on other matters prescribed by the Companies Act 2006
 

Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have been unable to form an opinion whether based on the work undertaken in the course of the audit:


the information given in the Strategic report and the Director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic report and the Director's report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

Notwithstanding our disclaimer of an opinion on the financial statements, in the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the Strategic report or the Director's report.
Arising from the limitation of our audit work referred to above: 
• we have not obtained all the information and explanations that we considered necessary for the purpose
          of our audit; and 
• we were unable to determine whether adequate accounting records have been kept.


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:


returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of director's remuneration specified by law are not made.


Responsibilities of directors
 

As explained more fully in the Director's responsibilities statement set out on page 4, the director is 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 director determines 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 director is 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 director either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 9

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ERWIN TECHNOLOGIES UK LIMITED (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

Our responsibility is to conduct an audit of the company’s financial statements in accordance with International Standards on Auditing (UK) and to issue an auditor’s report.
However, because of the matter described in the basis for disclaimer of opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.
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.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Robert Carter (Senior statutory auditor)
  
for and on behalf of
Feltons Chartered Accountants and Statutory Auditor
 
1 The Green
Richmond
Surrey
TW9 1PL

24 February 2025
Page 10

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
1,274,389
943,210

Cost of sales
  
(51,477)
(54,741)

Gross profit
  
1,222,912
888,469

Administrative expenses
  
(53,683)
(592,445)

Operating profit
 5 
1,169,229
296,024

Amounts written off investments
 8 
1,344,229
-

Interest receivable and similar income
 9 
39,101
5,776

Interest payable and similar expenses
 10 
-
(10,480)

Profit before tax
  
2,552,559
291,320

Tax on profit
 11 
(284,206)
(143,764)

Profit for the financial year
  
2,268,353
147,556

Other comprehensive income:
  

Items that will not be reclassified to profit or loss:
  

  

Total comprehensive income for the year
  
2,268,353
147,556

The notes on pages 15 to 27 form part of these financial statements.

Page 11

 
ERWIN TECHNOLOGIES UK LIMITED
REGISTERED NUMBER: 10313109

BALANCE SHEET
AS AT 31 DECEMBER 2023


2023

2022
Note
£
£
£
£

Fixed assets
  

Goodwill
 12 
1,206,485
1,206,485

  
1,206,485
1,206,485

Fixed assets
  

Investments
 13 
692,382
692,382

  
1,898,867
1,898,867

Current assets
  

Debtors: amounts falling due within one year
 14 
212,219
1,003,484

Cash at bank and in hand
 15 
1,885,101
836,697

  
2,097,320
1,840,181

Creditors: amounts falling due within one year
 16 
(1,278,520)
(3,289,734)

Net current assets/(liabilities)
  
 
 
818,800
 
 
(1,449,553)

Total assets less current liabilities
  
2,717,667
449,314

  

  

  

Net assets excluding pension asset
  
2,717,667
449,314

Net assets
  
2,717,667
449,314


Capital and reserves
  

Called up share capital 
 18 
2,778,888
2,778,888

Profit and loss account
 19 
(61,221)
(2,329,574)

  
2,717,667
449,314


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 17 February 2025.



A P Lyne
Director

The notes on pages 15 to 27 form part of these financial statements.

Page 12

 
ERWIN TECHNOLOGIES UK LIMITED
 

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


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2023
2,778,888
(2,329,574)
449,314


Comprehensive income for the year

Profit for the year

-
2,268,353
2,268,353


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
2,268,353
2,268,353


Total transactions with owners
-
-
-


At 31 December 2023
2,778,888
(61,221)
2,717,667


The notes on pages 15 to 27 form part of these financial statements.

Page 13

 
ERWIN TECHNOLOGIES UK LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2022
20
(2,477,130)
(2,477,110)


Comprehensive income for the year

Profit for the year

-
147,556
147,556


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
147,556
147,556

Shares issued during the year
2,778,868
-
2,778,868


Total transactions with owners
2,778,868
-
2,778,868


At 31 December 2022
2,778,888
(2,329,574)
449,314


The notes on pages 15 to 27 form part of these financial statements.



Page 14

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Erwin Technologies UK Limited is a private company limited by shares and is registered in England and Wales. The address of the registered office is 5 Churchill Place, 10th Floor, London, E14 5HU.
The company's immediate parent company is Erwin, Inc., a company incorporated in the United States of America. 
As at the balance sheet date, the company's ultimate parent undertaking is Clearlake Capital Group LP. Quest Identity Intermediate Limited, a company incorporated in the Cayman Islands, is the head of the  group for which consolidated accounts are prepared. Group financial statements can be obtained from Clearlake Capital Group LP, 233 Wilshire Blvd, Suite 800, Santa Monica CA..

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 Financial Reporting Standard 101 'Reduced Disclosure Framework'  and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 101 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

As permitted by FRS 101, the company has taken advantage of the disclosure exemptions available under that standard in relation to business combinations, share-based payment, non-current assets held for sale, financial instruments, fair value measurements, capital management, presentation of comparative information in respect of certain assets, presentation of a cash-flow statement, standards not yet effective, impairment of assets and related party transaction.

The following principal accounting policies have been applied:

 
2.2

Going concern

The director, after making enquiries and having regard to the company’s financial position, the company’s expected trading performance and cash flows, has a reasonable expectation that the company has adequate resources to continue operating for the foreseeable future. Therefore, these financial statements have been prepared on a going concern basis. 
The company meets its day-to-day working capital requirements through its cash inflows from operations and intercompany financing. 
In arriving at its conclusion, the director has taken account of the level of intercompany financing and cash resources which the company maintains to enable it to meet its working capital requirements.
The director will continue to monitor any significant adverse changes to cash flows, any adverse indicators in respect of the carrying value of assets and additional liabilities and take appropriate measures to address these matters, if required. 
At this time the future plans of the entity is to continue as a going concern for the foreseeable future, which management will continue to evaluate on an ongoing basis.

Page 15

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

  
2.3

Consolidation exemption

The company was, at the end of the year, a wholly-owned subsidiary of another company incorporated outside the EEA and in accordance with Section 401 of the Companies Act 2006, is not required to produce, and has not published, consolidated accounts.
Copies of the Group's financial statements for Quest Identity Intermediate Limited, a company incorporated in the Cayman Islands, can be obtained from Clearlake Capital Group, L.P., 233 Wilshire Blvd, Suite 800, Santa Monica, California,  USA. 

 
2.4

Revenue

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

The Company has contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the Company adjusts the transaction prices of these contracts for the time value of money.

Rendering of services

Turnover from providing services is recognised in the accounting period in which the services are rendered.

For fixed-price contracts, turnover is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided because the customer receives and uses the benefits simultaneously.

Where contracts include multiple performance obligations, the transaction price will be allocated to each performance obligation based on the stand-alone selling prices. Where these are not directly observable, they are estimated based on expected cost plus margin. For service contracts including a goods element, turnover for the separate good is recognised at a point in time when the good is delivered, the legal title has passed and the customer has accepted the good.

Page 16

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.5

Goodwill

Goodwill represents the excess of the cost of a business combination over the total acquisition date fair value of the identifiable assets, liabilities and contingent liabilities acquired.
Cost comprises the fair value of assets given, liabilities assumed and equity instruments issued.
When a business combination agreement provides for an adjustment to the cost of the combination which is contingent on future events, the company 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. However, if the potential adjustment is not recognised at the acquisition date but subsequently becomes probable and can be measured reliably, the additional consideration shall be treated as an adjustment to the cost of the combination. Changes in the estimated value of contingent consideration arising on business combinations completed as a consequence result in a change in the carrying value of the related goodwill.
Goodwill is capitalised as an intangible asset and is not amortised. Instead it is reviewed annually for impairment with any impairment in carrying value being charged to profit or loss. The Companies Act 2006 requires acquired goodwill to be reduced by provisions for depreciation calculated to write off the amount systematically over a period chosen by the directors, not exceeding its useful economic life. It has been deemed, however, the non-amortisation of goodwill is a departure, for the overriding purpose of giving a true and fair view. The effect of this departure has not been quantified because it is impracticable and, in the opinion of the directors, would be misleading.

 
2.6

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.7

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.

 
2.8

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.

 
2.9

Financial instruments

The Company recognises financial instruments when it becomes a party to the contractual arrangements of the instrument. Financial instruments are de-recognised when they are discharged or when the contractual terms expire. The Company's accounting policies in respect of financial instruments transactions are explained below:

Financial assets and financial liabilities are initially measured at fair value. 

Financial assets

All recognised financial assets are subsequently measured in their entirety at either fair value or
Page 17

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.9
Financial instruments (continued)

amortised cost, depending on the classification of the financial assets.

Fair value through profit or loss

All of the Company's financial assets are subsequently measured at fair value at the end of each reporting period, with any fair value gains or losses being recognised in profit or loss to the extent they are not part of a designated hedging relationship. The net gain or loss recognised in profit or loss includes any dividend or interest earned on the financial asset. 

Impairment of financial assets

The Company always recognises lifetime ECL for trade receivables and amounts due on contracts with customers. The expected credit losses on these financial assets are estimated based on the Company's historical credit loss experience, adjusted for factors that are specific to the debtors, general economic conditions and an assessment of both the current as well as the forecast direction of conditions at the reporting date, including time value of money where appropriate. Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument.

Financial liabilities

Fair value through profit or loss

Financial liabilities are classified as at fair value through profit or loss, when the financial liability is held for trading, or is designated as at fair value through profit or loss. This designation may be made if such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise, or the financial liability forms part of a group of financial instruments which is managed and its performance is evaluated on a fair value basis, or the financial liability forms part of a contract containing one or more embedded derivatives, and IFRS 9 permits the entire combined contract to be designated as at fair value through profit or loss. Any gains or losses arising on changes in fair value are recognised in profit or loss to the extent that they are not part of a designated hedging relationship.

At amortised cost

Financial liabilities which are neither contingent consideration of an acquirer in a business combination, held for trading, nor designated as at fair value through profit or loss are subsequently measured at amortised cost using the effective interest method. This is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or where appropriate a shorter period, to the amortised cost of a financial liability.

 
2.10

Creditors

Creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

Creditors are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

Page 18

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.11

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

 
2.12

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.13

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.14

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 balance sheet date in the countries where the Company operates and generates income.

 
2.15

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.

  
2.16

Related party transactions

The Company discloses transactions with related parties which are not wholly owned within the same Group. Where appropriate, transactions of a similar nature are aggregated unless, in the opinion of the director, separate disclosure is necessary to understand the effect of the transactions on the financial statements.

Page 19

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

  



3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In applying the Company's accounting policies, the directors are required to make judgments, estimates and assumptions in determining the carrying amounts of assets and liabilities. The directors' judgments, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made, and are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgments, estimates and assumptions, the actual results and outcomes may differ.
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, if the revision effects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods.
Critical judgments in applying the Company's accounting policies
The critical judgments that the directors have made in the process of applying the Company's accounting policies that have the most significant effect on the amounts recognised in the statutory financial statements are discussed below:
(i) Assessing indicators of impairment
In assessing whether there have been any indicators of impairment of assets, the directors have considered both external and internal sources of information such as market conditions, counterpart credit ratings and experience of recoverability. There have been no indicators of impairment identified during the current financial year.  
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:
(i) Recoverability of receivables
If necessary, the company establishes a provision for receivables that are estimated not to be recoverable. When assessing the recoverability the directors consider factors such as aging of receivables, past experience of recoverability, and the credit profile of an individual or groups of customers.
(ii) Intangible assets
The company establishes a reliable estimate of the useful life of Intangible assets arising on business combinations.  This estimate is based on a variety of factors such as the expected useful life of the cash generating units to which goodwill and other intangible assets are attributed and any legal, regulatory or contractual provisions that can limit useful life.

Page 20

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

Turnover is derived through the provision of related consultancy and support services and from the design and development of computer software. The director considers the turnover to consitute a single class of business and a single geographical market. 











5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Exchange differences
53,176
(18,292)


6.


Auditors' remuneration



Fees payable to the Company's auditor and its associates in respect of:


Fees payable to the Company's auditor and its associates for the audit of the Company's annual financial statements
-
7,500

-
7,500

Fees payable to the company's auditors are now charged to a fellow group undertaking Quest Software (UK) Limited. 


7.


Employees

Staff costs were as follows:





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


        2023
        2022
            No.
            No.







Admin
1
1

Page 21

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Income from investments








During the year a review of intercompany balances owed to and owed by fellow group companies was undertaken. This resulted in an adjustment of £1,344,229. 
Included in the total is an amount of £1,336,331 relating to a correction of a historical intra group transfer of intangible assets to a fellow group subsidiary company Casewise Systems, Inc., which resulted in an excessive amount of amortisation being charged to Erwin Technologies UK Limited's profit and loss account in previous accounting periods. 


9.


Interest receivable

2023
2022
£
£


Interest receivable
39,101
5,776

39,101
5,776


10.


Interest payable and similar expenses

2023
2022
£
£


Loans from group undertakings
-
10,480

-
10,480

Page 22

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
284,206
90,838


284,206
90,838


Total current tax
284,206
90,838

Deferred tax


Origination and reversal of timing differences
-
52,926

Total deferred tax
-
52,926


Taxation on profit on ordinary activities
284,206
143,764

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
2,552,559
291,320


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
638,140
55,351

Effects of:


Non-tax deductible amortisation of goodwill and impairment
-
81,681

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
-
2,115

Utilisation of tax losses
-
(52,926)

Non-taxable income
(316,170)
-

Other differences leading to an increase (decrease) in the tax charge
(37,764)
4,617

Deferred tax
-
52,926

Total tax charge for the year
284,206
143,764

Page 23

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

12.


Goodwill

2023
£

Cost

At 1 January 2023
1,206,485

At 31 December 2023
1,206,485

Amortisation

Net book value

At 31 December 2023
1,206,485



At 31 December 2022
1,206,485

1,206,485





Cash generating units

Goodwill is allocated to the company's cash generating unit as follows:


2023
2022
£
£



Purchase of trade and assets of Casewise Limited and Casewise Systems
Limited
1,206,485
1,206,485

1,206,485
1,206,485


13.


Fixed asset investments





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2023
692,382



At 31 December 2023
692,382




Page 24

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Casewise SARL
France
Ordinary
100%
Erwin S.R.L.
Italy
Ordinary
100%

The principal activity of Casewise SARL and Erwin S.R.L. was the sales of computer software and the provision of enabling consultancy and training. As at 31 December 2023, the fair value of Erwin S.R.L.  was £692,382 (2022 - £692,382) and Casewise SARL was £nil (2022 - £nil).


14.


Debtors

2023
2022
£
£


Trade debtors
-
540

Amounts owed by group undertakings
212,219
992,733

Other debtors
-
10,211

212,219
1,003,484


Amounts owed from group undertakings are unsecured, non-interest bearing and repayable on demand.


15.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,885,101
836,697

1,885,101
836,697


Page 25

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Creditors: Amounts falling due within one year

2023
2022
£
£

Amounts owed to group undertakings
945,048
2,350,146

Corporation tax
284,206
90,838

Accruals and deferred income
49,266
848,750

1,278,520
3,289,734


Amounts owed to group undertakings are unsecured, non-interest bearing and repayable on demand. 


17.


Financial instruments

2023
2022
£
£

Financial assets


Financial assets that are debt instruments measured at amortised cost
2,097,321
1,840,182


Financial liabilities


Financial liabilities measured at amortised cost
(902,298)
(2,307,396)


Financial assets measured at amortised cost comprise bank balances, trade debtors, amounts due from group undertakings and other debtors.


Financial liabilities measured at amortised cost comprise trade creditors, amounts due to group undertakings and accruals.
 

18.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



2,778,888 (2022 - 2,778,888) Ordinary shares of £1.00 each
2,778,888
2,778,888


On 24 May 2022 the company allotted 2,778,868 of new ordinary share of £1 each for par consideration to Erwin, Inc., its immediate parent company.

Page 26

 
ERWIN TECHNOLOGIES UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19.


Reserves

Profit and loss account

The profit and loss reserve represents cumulative profits for the year and prior periods, net of dividends
paid and other adjustments.


20.


Controlling party

The company is a wholly-owned subsidiary of Erwin, Inc. a company incorporated in the United States of America and is its immediate parent company.
The company's ultimate parent undertaking is Clearleake Capital Group LP.
 
As the company was, at the end of the year, a wholly-owned subsidiary of another company incorporated outside the EEA, in accordance with Section 401 of the Companies Act 2006, it is not required to produce, and has not published, consolidated accounts.
Copies of the Group's financial statements can be obtained from Clearlake Capital Group, L.P., 233 Wilshire Blvd, Suite 800, Santa Monica, California, USA.

 
Page 27