The directors present the strategic report for the year ended 31 December 2022.
The company is a market research company and its principal activity for the parent company and subsidiaries is data collection for qualitative and quantitative research services in Germany, France, Spain and the United Kingdom.
The main business conducted is the recruitment of participants for market research, use of our facilities in Europe to perform data collection and ancillary services such as moderation and translation.
The process of risk acceptance and risk management is addressed through a framework of policies, procedures and internal controls. All policies are subject to senior management approval and ongoing review by directors, management and shareholders. Compliance with regulation, legal and ethical standards is a high priority for the Group and the Group finance department take on an important oversight role in this regard.
The group finance departments are responsible for satisfying themselves that a proper internal control framework exists to manage financial risks and that controls operate effectively. The Group has developed a framework for identifying the risks that each business sector, and the Group as a whole, is exposed to and their impact on economic capital.
This process is risk based and uses Individual Capital Assessment principles to manage our capital requirements and to ensure we have the financial strength and capital adequacy to support the growth of the business and to meet the requirements of shareholders, regulators and stakeholders both internal and external.
The principal risks in our data collection business arise from inaccurate pricing.
The results of the Group for the year, as set out in our statutory accounts, show turnover of €24m (2021: €23m) and a loss on ordinary activities before tax of €3.5m (2021: €2.5m).
During 2020 the company shifted its focus more to digital solutions which continued to show strong growth during 2021 (+58% vs 2020). In 2021 Digital solutions contributed 84% of revenue compared to 67% in 2020. In 2022 the proportion of Digital solutions was 80% of total revenue as we saw more of a return to our In-Person business post the COVID-19 pandemic. However, there was some negative impact mainly across mainland Europe on the Market Research business which continued to be impacted by the return from the COVID-19 pandemic and ongoing economic factors. This led to the closure or reduction of facilities. There is currently an increased focus in sales, business development and operations, which resulted in improves in the Gross Profit Margin’s (from 56% to 58%), and the Group have made further key hires to accelerate this. The Group has made stronger efforts and will continue to improve on our controls and disciplines around pricing to make sure customer satisfaction continues to grow. Our European offices are now taking a particular focus in the expansion of our online quantitative offering which will strengthen our relationships with clients.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2022.
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The directors refer to Note 25 Events after the Reporting date in respect of post reporing date events.
The directors refer to the Going Concern Section of this Directors' Report in respect of the future developments of the business.
The Group continued to see some recovery at the beginning of 2022 from the COVID-19 pandemic which severely impacted the business in 2020. However, the Group remained loss making due to investments across the team to prepare for expected high growth performance in 2022, which did not materialize. At the end of 2022 the directors decided to restructure its European business to reduce its cost base due to ongoing pressure on sales resulting from the shift in the landscape of the Market Research Business post COVID-19 and from the ongoing state of the general economy.
In 2023, the Group continued to see an adverse impact on turnover, due to these factors and posted a loss for the year – albeit a smaller one than that incurred in 2022.
In 2024 the Group continued to see the trend of challenging market conditions which led to a further cutting of costs back to the level prior to the investments in 2021 mentioned above. This includes reviewing the ongoing In-Person business which continues to show signs of slowdown. The Market Research Business has shifted, since Covid, particularly reflecting the use of online tools and opportunities which has resulted in the significant reduction of “in-Person Business”.
The directors have given due consideration to the Group's historical and current trading, together with the forward-looking projections to 2025/2026 and note that the Group is dependent upon the continued support of its ultimate parent company Schlesinger Group Holdings, LLC and related subsidiaries. As at 31 December 2022 the Group owed the ultimate parent company circa. €5m and since that date up to 31 December 2024 further loans have been received totalling €0.5m. The directors have received a letter of support from the ultimate parent company which states they will not request repayment of the monies owed until the Group has adequate funds. In addition, the directors are satisfied that there is both the ability and intention to continue to provide this support, and any additional support should it be required. The ultimate parent company is currently in negotiations with its lender to extend the repayment date of term loans totalling $174m in July 2025. The ultimate parent company directors feel confident that an extension or re-finance will be achieved based on previous discussions.
As such, the directors continue to adopt the going concern basis of accounting in preparing the annual financial statements. The financial statements do not include the adjustments that would result if the Group and Company were unable to continue as a going concern.
At the time of approving the financial statements, based on the above information, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
Qualification for limitation of scope
We have audited the financial statements of Schlesinger Group UK Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the group statement of comprehensive income, the group statement of financial position, the company statement of financial position, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows 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 Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for qualified opinion
Material uncertainty related to going concern
We draw attention to the financial statements, which shows that the group incurred a net loss of €3.5m during the year ended 31 December 2022 and that, as at that date, the group had net current liabilities of €6.3m and total liabilities exceeded its total assets by €5.1m. As stated in note 1.3, the group continued to trade at a loss after the balance sheet date. As a result, the group relies on the continued support of the ultimate parent company which is currently in negotiations with its lender to extend the repayment date of term loans. As the parent company support is required, the on-going negotiations with the lender indicate that a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
Except for the possible effects of the matters described in the basis for qualified opinion section of our report in our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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.
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.
Audit procedures included:
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Group's and the Parent Company. We determined that the most significant are directly relevant to specific assertions in the financial statements are those related to the reporting framework (FRS 102, the Companies Act 2006) and the tax related legislation (the Finance Act);
We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.
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 inquired of management and those charged with governance as to any known instances of noncompliance or suspected non-compliance with laws and regulations.
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Evaluate the appropriateness of accounting policies used and the related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
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.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's 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 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.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was €261,672 (2021 - €318,115 loss).
Schlesinger Group UK Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 9 Kingsway, London, WC2B 6XF.
The group consists of Schlesinger Group UK Limited and all of its subsidiaries.
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 euros, which is the functional currency of the group. The company's functional currency is sterling. 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.
The 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 for parent company information presented within the consolidated financial statements:
- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated financial statements incorporate those of Schlesinger Group UK Limited and all of its subsidiaries (i.e. entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 31 December 2022. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The Group continued to see some recovery at the beginning of 2022 from the COVID-19 pandemic which severely impacted the business in 2020. However, the Group remained loss making due to investments across the team to prepare for expected high growth performance in 2022, which did not materialize. At the end of 2022 the directors decided to restructure its European business to reduce its cost base due to ongoing pressure on sales resulting from the shift in the landscape of the Market Research Business post COVID-19 and from the ongoing state of the general economy.
In 2023, the Group continued to see an adverse impact on turnover, due to these factors and posted a loss for the year – albeit a smaller one than that incurred in 2022.
In 2024 the Group continued to see the trend of challenging market conditions which led to a further cutting of costs back to the level prior to the investments in 2021 mentioned above. This includes reviewing the ongoing In-Person business which continues to show signs of slowdown. The Market Research Business has shifted, since Covid, particularly reflecting the use of online tools and opportunities which has resulted in the significant reduction of “in-Person Business”.
The directors have given due consideration to the Group's historical and current trading, together with the forward-looking projections to 2025/2026 and note that the Group is dependent upon the continued support of its ultimate parent company Schlesinger Group Holdings, LLC and related subsidiaries. As at 31 December 2022 the Group owed the ultimate parent company circa. €5m and since that date up to 31 December 2024 further loans have been received totalling €0.5m. The directors have received a letter of support from the ultimate parent company which states they will not request repayment of the monies owed until the Group has adequate funds. In addition, the directors are satisfied that there is both the ability and intention to continue to provide this support, and any additional support should it be required. The ultimate parent company is currently in negotiations with its lender to extend the repayment date of term loans totalling $174m in July 2025. The ultimate parent company directors feel confident that an extension or re-finance will be achieved based on previous discussions.
As such, the directors continue to adopt the going concern basis of accounting in preparing the annual financial statements. The financial statements do not include the adjustments that would result if the Group and Company were unable to continue as a going concern.
At the time of approving the financial statements, based on the above information, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Project turnover
Turnover is accounted for on a receivable basis in the year to which it relates. Income is stated net of VAT. Income from the supply of services represents the value of services provided under contracts to the extent that there is a right to consideration and is recorded at the value of the consideration due. Where a contract has only been partially completed at the Consolidated Statement of Financial Position date, income represents the value of the service provided to date based on a proportion of the total contract value. The proportion is determined by the value of work done at the Consolidated Statement of Financial Position date compared to total value of work expected over the life of the contract.
Incentive turnover
Turnover is recognised net of value added tax at a point in time at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services.
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 recognised in the income statement.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group 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.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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.
The group 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 group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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, 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, 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.
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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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.
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 group after deducting all of its 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.
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.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group 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 group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable loss for the year. Taxable loss differs from net loss as reported in the income statement 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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
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 income statement, 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 if, and only if, there is 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.
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.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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 leased asset are consumed.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
Functional and presentation currency
The Company's functional currency is Sterling. This differs from the presentational currency which is Euros, which has been used as this is the functional currency of the majority of the Group.
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 the Consolidated Statement of Comprehensive Income except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Consolidated Statement of Comprehensive Income within 'other operating income'.
On consolidation, the results of the Parent Company are translated into Euros at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.
In the application of the group’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.
The following are key sources of estimation uncertainty that the directors have applied in the process of applying the Company's accounting policies that have the most significant effect on the amounts recognised in the financial statements:
Where there are indicators of impairment of individual assets, the company performs impairment tests based on fair value less costs to sell or a value in use calculation.
Management applies judgement in evaluating the recoverability of debtors. This judgement is base on the ageing profile of debtors and historical experience. To the extent that the directors believe debtors not to be recoverable they have been provided for in the financial statements.
Tangible fixed assets and intangible assets are depreciated/amortised over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account.' Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
Where there are indicators of impairment of the fixed asset investments held, the company performs impairment tests on each subsidiary as a single asset.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 0 (2021 - 1).
The actual charge/(credit) for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
Group
The cost and accumulated amortisation of goodwill as at 31 December 2021 were both overstated by €169,105. These figures have been amended in 2022 and not shown as a prior year adjustment as the balance sheet impact is €Nil.
In the previous year's financial statements, the database cost and accumulated amortisation were classified under the heading of Goodwill within intangible fixed assets. In 2022 the above transfers represent the cost of databases of €469,106 and the accumulated amortisation of €116,369 being re-classified under the heading of Software and databases within intangible fixed assets. The overall impact on intangible fixed assets is €Nil.
Details of the company's subsidiaries at 31 December 2022 are as follows:
The above financial assets are measured at amortised cost.
The above financial liabilities are measured at amortised cost.
The above financial liabilities are measured at amortised cost.
The group has unrecognised deferred tax assets of €1,301,654 (2021 - €706,564) in respect of losses carried forward that can be offset against future profits. The timing of the realisation of the asset is uncertain and consequently the asset has not been recognised.
The company has unrecognised deferred tax assets of €146,256 (2021 - €112,552) in respect of losses carried forward that can be offset against future profits. The timing of the realisation of the asset is uncertain and consequently the asset has not been recognised.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
Each share has full rights in the company with respect to voting, dividends and distributions.
Other reserves
The Group’s other reserves brought forward includes a capital contribution of €280,000, in respect of the company's Spanish subsidiary, that was made by the US parent company of the group. During the current year the liability for that capital contribution has been reclassified as being owed by the UK parent company.
In the company’s statement of financial position in 2022 this is shown as an additional investment in subsidiaries. In the 2022 group’s statement of financial position, the capital contribution and the additional investment in subsidiaries eliminate each other, and the €280,000 is shown as an additional liability to the ultimate parent company.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The remuneration of key management personnel is as follows.
Since the balance sheet date, as part of the restructuring work undertaken to improve performance of the parent and subsidiary companies, the Board of Directors has approved the closure of the Group’s French and Spanish offices and German and Spanish facilities, due to shifting work patterns (resulting in underutilized office space) and the post-COVID transition to online digital research solutions, which rendered the facilities unprofitable.
The closure process is expected to be completed by Quarter 2 of 2025, with client contracts being either fulfilled or transferred to a strategic partner where required. As a result, the Group expects to incur one-off costs, which include redundancy payments and write-down of related assets such as facility specific equipment that is no longer required. These costs, including redundancy payments and asset write-downs, will be recognized in the financial statements for the years ending 2023 to 2025, as they are incurred.
Because the decision to close these operations was made after the 31 December 2022 reporting date, no adjustments have been made to the financial statements, in accordance with FRS 102. This disclosure provides transparency into the Group’s strategic direction and anticipated financial impact.
The Directors have reviewed the impact of these closures on the Group’s overall business and have concluded that the closures strengthen the Group’s long-term financial position and does not affect the Group’s ability to continue as a going concern. The remaining operations continue to generate revenue, and the Group has sufficient resources to meet its obligations as they fall due.