Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
CONTENTS
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BALLINGER GROUP HOLDINGS (UK) LTD
COMPANY INFORMATION
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The Directors of Ballinger Group Holdings (UK) Ltd (the “Company”) present the annual report and financial statements of the Ballinger Group Holdings (UK) Ltd and its subsidiaries (the “Group”) and the Company for the period ended 31 December 2023. The Group's strategic report is provided to be read with other parts of the following report, including the financial statements and notes.
The Group consists of the following entities:
∙Ballinger Group Holdings (UK) Ltd.
∙Ballinger & Co. Ltd: a London based, FCA regulated payments institution.
∙Ballinger Europe Limited and Ballinger Markets Limited: both regulated in Malta.
∙Ballinger Risk Management Limited: currently a dormant company.
∙Ballinger Group Holding (Jersey) Limited: a holding company incorporated in Jersey, Channel Islands.
∙Ballinger Payments BV: incorporated in the Netherlands.
Ballinger Group Holdings (UK) Ltd was founded in 2020. The Company’s principal activity in 2023 was of the holding company. The principal activity of the main trading entity, Ballinger & Co. Limited in the same financial period was providing foreign currency payments services to individual and institutional clients. The Maltese entities were not operational during 2023 and they booked their first trade in first quarter of 2024. The only revenue generating entity within the Group in 2023 was Ballinger & Co. Ltd.
In 2023, the Group achieved a turnover of £29.70 million, an increase from £18.60 million in 2022. The gross value of currency transactions sold in 2023 is £5.255 billion (2022: £4.618 billion), the corresponding gross value of the currency transactions purchased is £5.225 billion (2022: £4.599 billion). The profit before tax margin stands at 35% up from 13% in 2022. The Group is experiencing rapid growth and is actively using its available capital to reshape the market for clients who need deep, competitive liquidity, along with flexible credit terms, efficient onboarding, and competitive terms for foreign currency contracts. The board and management routinely review and update the Group's business forecasts and model to ensure they account for recent macroeconomic and microeconomic changes. The Directors of the Group are satisfied with the overall performance of the group entities in the current financial year and are confident that the Group has sufficient knowledge and experience to achieve its targets. Going concern The Directors have assessed the Group’s and Company's ability to continue as a going concern. Management reviewed its day-to-day working capital needs, the current economic conditions, and investments in platform and technology development. Based on these analyses, they concluded that the Group has sufficient financial resources and professional team and is expected to continue operating for at least 12 months from the date of approval of the financial statements. The Group’s annual financial statements are prepared on a going concern basis.
The Group face both internal and external risks and uncertainties, including legal and regulatory factors specific to the industry in which the Group operates. The main risk areas identified by the Group are as follows:
Credit Risk – This risk arises when a customer or counterparty fails to meet its obligations by the maturity date. To mitigate this risk, management evaluates potential customers before onboarding and regularly reviews existing customers. The counterparty credit risk is considered low since they are well-established and reputable financial institutions.
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Liquidity Risk – Liquidity risk relates to the Group’s ability to maintain sufficient liquid funds to meet its liabilities. The Group frequently reviews financial forecasts against actual performance to detect risks early. Additionally, the Group has established financing facility agreements to mitigate liquidity risk. Foreign Currency Risk – The Group engages in revenue generation and purchases in foreign currencies, making it subject to fluctuations in foreign exchange rates. This risk is mitigated through offsetting trades with customers and financial institutions. The foreign currency risk associated with purchases is minimal, as most vendors invoice the Group in the entity’s base currency. Operational Risk – The Group maintains a comprehensive risk registry, allowing management to identify and document risks and take appropriate action. Management acknowledges that the risks listed above are not exhaustive. A key aspect of the Group's overall risk management strategy is ensuring that both management and staff receive relevant training on legal, regulatory, and professional development areas.
The Group considers the following macroeconomic and microeconomic conditions that may directly impact the business. The factors listed below present both risks and opportunities for the business. They may generate demand for certain currencies and products, influence market preferences for long-term or short-term contracts, and impact the Company’s ability to access market liquidity.
∙Interest Rates
∙Economic Indicators: GDP growth, employment rates, and manufacturing output can affect currency values. Strong economic performance often leads to a stronger currency.
∙Political Stability and Performance:
∙Inflation Rates:
∙Market Speculation: Speculators buying and selling currencies can create fluctuations in exchange rates. Market sentiment and speculative activities can drive short-term currency movements.
∙Global Economic Events: financial crises, pandemics, and significant geopolitical events can cause volatility and impact currency exchange rates.
∙Monetary Policies:
∙Capital Flows: Movements of capital in and out of a country (investment opportunities and economic conditions, can affect exchange rates)
∙Commodity Prices: (e.g., oil, gold), changes in global commodity prices can influence their currency value.
Government Debt:
∙Market Liquidity:
Management discusses global economic and political events to ensure that the team is informed and up to dated on key developments. Additionally, Ballinger shares its expert knowledge and analysis with external stakeholders through publicly available daily newsletters.
The management identifies the following key business risks:
∙Loss of major customer(s)
∙Revenue concentration, when a small number of clients generate the majority of the revenue
∙Withdrawal or reduction of the counterparty credit line
∙Customer defaults
∙Exposure to few currencies
∙Sector concentration (e.g. focusing on retail or logistics industries)
∙Failure to recruit the best talent for the sales, dealing teams and support function.
To address the above-listed risks, management prioritises recruiting top talent, providing regular training, and encouraging professional development. Management also designs and continuously reviews incentive structures
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
to ensure they address revenue, sector, and currency concentration risks. Additionally, the Group diversifies and expands its partnerships with liquidity providers to mitigate liquidity risks.
The sales procedures, technology development, and incentive schemes are designed to provide management with high-quality data to identify key trends and issues, allowing them to devise quick and efficient solutions.
The Group has quickly established itself as the go-to non-bank foreign exchange payments provider for clients with large and complex requirements. The team re-formed at Ballinger & Co. Ltd to create a fiercely independent firm, funded by our Executive Chairman Will Tracey, our founders and Directors, the CEO’s Family Office, and a well-known financial services investor Darren Carter (Chairman of investment bank Peel Hunt). The Group has been profitable since inception, with all profit retained in the business to fuel growth of the business and its balance sheet.
The Directors identified that access to the best technology portfolio is critical for the Company’s steady growth and effective operational risk management. The Group leverages a sophisticated and integrated technology portfolio to enhance operational efficiency, streamline processes, and drive business growth. The board has agreed to allocate resources for technology development. The Group is subject to environmental legislation in accordance with applicable law in the United Kingdom. The Group's operations have minimal environmental impact. The Group encourages and supports employees in their professional development. Many employees pursue well-recognised and highly regarded qualifications and regularly attend training sessions and seminars. The Group provides both financial assistance and other necessary support.
The Group monitors the following key performance indicators:
∙Turnover increase on monthly and quarterly basis
∙Increase of the gross profit and net profit margin
∙New customers onboarded and traded
∙Diversifying its revenue
In Q1, the Group achieved a turnover of £3,228,148, which grew steadily to £5,214,948 in Q2. Q3 saw a significant increase to £8,543,434, and by Q4, turnover reached £12,713,004, marking a strong 49% growth from the previous quarter. Overall, the Group experienced consistent growth throughout the year, driven by strategic initiatives and seasonal demand.
The gross profit margin remained above the 50% target for most of the year but declined slightly to 45% in Q3. This decline was primarily due to accounting for potential losses from early drawdowns by a single client. The Group also recorded a steady increase in trade bookings, rising from 1,697 in Q1 to 2,186 in Q4. The net profit margin increased from 11% in 2022 to 15% in Q1 2023, reaching 34% in Q4.
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The headline consolidated financial performance for the financial years 2023 and 2022 is summarised below:
The increase in turnover in 2023 was driven by several factors, including growth in the number of active clients and an improvement in the blended average spread margin from 0.40% in 2022 to 0.56% in 2023. In the final quarter of 2024, 97 clients generated a turnover of £12.7 million, compared to 215 clients in 2022 delivering £5 million. This indicates a significant shift in business performance and client value. Despite having fewer clients in Q4 of 2023, turnover more than doubled compared to the same period in 2022. Furthermore, 2023 saw the addition of new clients with large trade volumes across multiple currencies, underscoring the Group’s capacity to meet the complex needs of its clients.
This report was approved by the board and signed on its behalf.
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors of Ballinger Group Holdings (UK) Ltd present their report and the audited consolidated and separate financial statements for the year ended 31 December 2023.
The profit for the financial year amounted to £7,834,506 (2022 - £1,881,140).
The directors do not recommend the payment of a dividend (2022: £nil).
There were no changes from the previous year. The directors who served during the year were:
The highest paid director's total compensation was £830,000 in 2023 (2022 - £650,879). Additional information related to directors' remuneration is provided in note 5.
The Group's principal activity, along with that of its main subsidiaries, is to provide foreign currency payment services to both private and institutional clients. The Maltese entities are regulated in accordance with local and EU regulations, enabling the Group to extend its full range of services to EU clients. One of the Group’s subsidiaries, Ballinger Markets Limited, is a MiFID-regulated entity and provides investment products to its clients.
In 2024, the Maltese entities became fully operational, which is expected to enhance the Group’s global reach and enable the introduction of new services through its Malta-based operations. Additionally, the Group made significant investments in platform and technology development in 2023, which are expected to improve operational efficiency and support long-term growth.
As permitted by s414c (11) of the Companies Act 2006, the directors have elected to disclose information, required to be in the directors' report by Schedule 7 of the 'Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008', in the strategic report.
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The Group has entered into a settlement agreement concerning ongoing litigation with a client, with the settlement funds received in late December 2024.
Ballinger & Co. Ltd declared dividends sufficient to offset the Company’s accumulated losses and establish adequate distributable reserves for the repurchase of its own shares. In 2023 and 2024, the Company attempted to repurchase its own shares from two shareholders. Following legal advice, the Directors concluded that the Company lacked sufficient distributable reserves at the time of the buybacks, rendering both repurchases void. Subsequently, in accordance with professional guidance, new buybacks were successfully completed in January 2025 for the original considerations. There have been no other significant events impacting the Group since the year end. Additional details regarding post balance sheet events are provided in Note 27 – Subsequent Events.
The new auditors, Forvis Mazars LLP, were appointed in May 2024. The directors of the Company will propose for reappointment of auditor, Forvis Mazars LLP, in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
On behalf of the board
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BALLINGER GROUP HOLDINGS (UK) LTD
GROUP DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors are responsible for preparing the Group strategic report, the Directors' report and the Group and the Company financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Group's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements and other information included in Directors' reports may differ from legislation in other jurisdictions.
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BALLINGER GROUP HOLDINGS (UK) LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BALLINGER GROUP HOLDINGS (UK) LTD
FOR THE YEAR ENDED 31 DECEMBER 2023
We have audited the financial statements of Ballinger Group Holdings (UK) LTD (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2023 which comprise the Consolidated profit and loss account, the Consolidated balance sheet, the Parent Company balance sheet, the Consolidated statement of changes in equity, the Parent Company statement of changes in equity, Consolidated statement of cash flows and notes to the financial statements, including material accounting policy information.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the “Auditor’s responsibilities for the audit of the financial statements” section of our report. We are independent of the group and the parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the Annual Report and Financial Statements, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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BALLINGER GROUP HOLDINGS (UK) LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BALLINGER GROUP HOLDINGS (UK) LTD (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group 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 Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors’ report.
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 the financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
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.
Based on our understanding of the group and the parent company and their industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation, and anti-money laundering regulation.
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BALLINGER GROUP HOLDINGS (UK) LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BALLINGER GROUP HOLDINGS (UK) LTD (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:
∙Inquiring of management and, where appropriated, those charged with governance, as to whether the group and the parent company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations;
∙Inspecting correspondence, if any, with relevant licensing or regulatory authorities;
∙Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and
∙Considering the risk of acts by the group and the parent company which were contrary to applicable law and regulations, including fraud.
We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, the Companies Act 2006.
In addition, we evaluated the directors’ and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to the valuation of derivatives, revenue recognition, and significant one-off or unusual transactions. Our audit procedures in relation to fraud included but were not limited to:
∙Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud;
∙Gaining an understanding of the internal controls established to mitigate risks related to fraud;
∙Discussing amongst the engagement team the risk of fraud; and
∙Addressing the risk of fraud through management override of controls by performing journal entry testing.
There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.
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.
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.
for and on behalf of Forvis Mazars LLP
Address: 30 Old Bailey, London EC4M 7AU
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BALLINGER GROUP HOLDINGS (UK) LTD
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 50 form part of these financial statements.
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BALLINGER GROUP HOLDINGS (UK) LTD
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
On behalf of the board
The notes on pages 19 to 50 form part of these financial statements.
(*) Refer to note 21 for the prior year adjustments.
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BALLINGER GROUP HOLDINGS (UK) LTD
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Ballinger Group Holdings (UK) Ltd is a private company limited by shares, incorporated in England & Wales. The address of the registered office is 65 Curzon Street, London, England, W1J 8PE. Its principal activity is that of a holding company.
The Group consolidated and Company financial statements are presented in Sterling (£), which is the functional currency of the Company. Monetary amounts in these financial statements are rounded to the nearest £. Ballinger Group Holdings (UK) Ltd primarily serves as the holding company for the Ballinger Group companies. Ballinger Group comprises Ballinger & Co. Ltd, a London-based, FCA regulated payments institution, as well as Ballinger Europe Ltd and Ballinger Markets Ltd, both regulated in Malta. Other companies include Ballinger & Co Risk Management Limited (a dormant company), Ballinger Group Holdings (Jersey) Limited and Ballinger Payments B.V. (Netherlands). The principal accounting policies for the Group are summarised below. They have all been applied consistently throughout the year and preceding year. The principal activities of the Company and its subsidiaries ("the Group") together with the nature of the Group’s operations are set out in the strategic report on pages 2 to 5. The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.
2.Accounting policies
The Group and Company financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The financial statements of two subsidiaries have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU. As both subsidiaries remained non-operational throughout the reporting period, and given that their operational expense bases are similar to those under Financial Reporting Standard 102 (FRS 102), management has concluded that the financial results would not differ materially if the statements were prepared in accordance with FRS 102, the applicable financial reporting framework in the UK and the Republic of Ireland, in conjunction with the Companies Act 2006.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated profit and loss account from the date on which control is obtained. They are deconsolidated from the date control ceases.
Page 19
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
FRS 102 section 1.12 allows a qualifying entity certain disclosure exemptions, subject to certain conditions, which have been complied with, including notification of, and no object to, the use of exemptions by the Company's shareholders.
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and loss account in these financial statements. Included within the consolidated statement of profit and loss is a loss of £415,342 attributable to the Company. The Company has taken advantage of the exemption allowed under FRS 102, paragraph 1.12(b), which allows a qualifying entity to be exempt from preparing a separate statement of cash flows if it is included in publicly available consolidated financial statements intended to give a true and fair view.
The Group's Directors have assessed the Group’s ability to continue as a going concern. Management reviewed its day-to-day working capital needs, the current economic conditions, and investments in platform and technology development. Based on these analyses, they concluded that the Group has sufficient financial resources and professional team and is expected to continue operating for at least 12 months from the date of approval of the financial statements. The Group’s annual financial statements are prepared on a going concern basis.
The Company primarily serves as the holding company for the Ballinger Group companies. In addition to its holding company activities, the company has entered into loan facility agreements with external parties to provide capital for collateral and business development purposes. The Company’s annual financial statements are prepared on a going concern basis. The Directors of the Company has reviewed the overall forecasts and concluded that there are no internal or external factors that could negatively affect the Company’s ability to operate in forceable future, for at least 12 months from the date of approval of the financial statements.
Page 20
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The Group generated revenue from providing domestic and foreign currency payment services to individual and institutional customers. The revenue comprised of the difference between gross value of currency transactions sold and gross value of currency transactions purchased.
The revenue is recognised when: (a) the gross value of sold currency and gross value of purchased currency can be measured reliably, (b) there is an agreed and accepted contract between the Group and customer, (c) and to the extent that it is probable that the economic benefits will flow to the Group. The revenue from the spot contracts is recognised at the time a contract is entered into and accepted by the customer and the Group. The Group also provides foreign currency forward contracts, and the revenue is recognised at the point when both the Group and the customer agree and accept the contract terms. Foreign currency forward contracts can include provisions for early drawdowns which allow clients execute trades fully or partially before the agreed settlement date. In some cases, early drawdown may generate losses. To reliably model and adjust recognised revenues under such contracts, management should assess whether sufficient historical data and client insights are available as at the reporting date. Management evaluates open forward contracts as of the reporting date and applies various scenarios to assess expected cash flows from early drawdowns. When client insights are available, management models an indicative monthly drawdown schedule to estimate expected gains or losses based on the remaining contract duration. This adjustment to turnover is reflected on the balance sheet through the fair value movement of derivative financial assets.
The Group incurs costs directly related to its revenue-generating activities, primarily consisting of commissions, bank charges, and costs related to market fluctuations. Commissions are accrued in the same period in which the associated revenue is recognised, while bank charges and market-related costs are recognised as they arise.
Page 21
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
Page 22
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed annually, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Where factors, such as technological advancement or changes in market price, indicate that residual value or useful life have changed, the Group will assess the tangible fixed assets for impairment and recognise the cost in profit or loss statement.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Intangible assets are only recognised separately from goodwill where they are separable and arise from contractual or other legal rights.
Intangible assets are stated at cost less accumulated amortisation and accumulated impairment losses. Amortisation is calculated, using the straight-line method, to allocate the depreciable amount of the assets to their residual values over their estimated useful lives, as follows: Computer software - 5 years The Group recognises the computer software intangible asset in relation to software configuration and enhancement to incorporate critical features and bring the software into service. Where factors, such as technological advancement or changes in market price, indicate that residual value or useful life have changed, the Group will test the assets for impairment and recognise the cost in profit or loss statement.
The Group has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.
Financial assets and financial liabilities are recognised when the Group becomes party to the contractual provisions of the instrument.
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.
The Group’s policies for its major classes of financial assets and financial liabilities are set out below.
Page 23
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Financial assets
Basic financial assets, including trade and other debtors, cash and bank balances, intercompany working capital balances, and intercompany financing are initially recognised at transaction price, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment.
As of the reporting date, management applies various scenarios to analyse expected gains or losses from early drawdowns. They assess expected net cash flows. When client insights and reliable data are available, management uses detailed model to estimate gains or losses from early or partial settlement. Financial assets are adjusted for estimated losses from early drawdowns, with corresponding entries posted to turnover. The Group in some circumstances may hold collateral against trade receivables, with corresponding liability. Apart from this, the Group does not trade in financial instruments and all such instruments arise directly from operations. All trade and other debtors are initially recognised at transaction value, as none contain in substance a financing transaction. Thereafter trade and other debtors are reviewed for impairment where there is objective evidence based on observable data that the balance may be impaired. The Group may hold the collateral against its trade receivables if clients are not within agreed margin facility. In all other circumstances its exposure to credit risk is the net balance of trade and other debtors after allowance for impairment.
Financial liabilities
Basic financial liabilities, including trade and other creditors, loans from fellow group companies 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade and other creditors and accruals are initially recognised at transaction value as none represent a financing transaction. They are only derecognised when they are extinguished. As the Company only has short term receivables and payables, its net current asset position is a reasonable measure of its liquidity at any given time.
Derivative financial instruments
Derivative foreign exchange contracts are standalone, non-hedging derivative financial assets and liabilities. They are measured at fair value as of the reporting date, with any changes in fair value recognised in profit or loss.
Page 24
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Impairment of financial assets
Financial assets measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the profit and loss account.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the Group would receive for the asset if it were to be sold at the reporting date.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets and financial liabilities
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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. In these financial statements, where the Group has the right to settle outstanding debtor and creditor balances with the broker on a net basis, those balances have been offset in the balance sheet.
Page 25
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The tax expense for the year comprises current and deferred tax. Tax is recognised in the profit and loss account, 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.
Current tax is the amount of income tax payable in respect of taxable profit for the year or prior years. 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. Deferred tax arises from timing differences that are differences between taxable profits and total comprehensive income as stated in the financial statements. These timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements. Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Page 26
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date. A deferred tax asset is recognised in respect of share options granted in 2021 and 2023. Typically, tax relief for the cost of share option grants is provided as a deduction in the accounting period when the shares are acquired (as per s.1013 CTA 2009). This creates a deferred tax asset due to the recognition of the cost of equity-settled transactions over the vesting period. Management believes that the profit projections indicate that the Group can sustain the deferred tax asset.
Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the balance sheet.
Ordinary shares are classified as equity. Where the total consideration received exceeds the nominal value of the allotted shares, the Group records the excess as share premium. From time to time, the Company's management may consider purchasing its own shares.
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to profit or loss over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Company keeping the scheme open or the employee maintaining any contributions required by the scheme). Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
Page 27
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The directors make estimates and assumptions that may impact the financial statements. These estimates include provisions and contingent liabilities. Actual results could be different from the initial assumptions and estimates.
Provisions are recognised in the financial statements when it is probable that an outflow of economic benefits will be required to settle a present obligation for which the estimation of the amount of the obligation can be made reliably. A contingent liability is either a possible but uncertain obligation or a present obligation that is not recognised because either an outflow of economic benefits is not probable or the amount of the obligation cannot be reliably made. A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. Contingent assets are not recognised.
Finance costs are recognised in profit or loss in the year in which they are incurred.
The preparation of financial statements involves directors making estimates and assumptions that impact the reported values of assets, liabilities, and the disclosure of contingent assets and liabilities as of the financial statement date, as well as the reported revenue and expenses throughout the year. Actual results may differ from these estimates.
Items that require significant management estimates include the fair value of financial instruments, provisions related to ongoing litigation, and share-based payments. Management bases these estimates on historical experience, current market conditions, and other factors deemed reasonable under the circumstances, in accordance with the Group's accounting policies. Further details on these estimates are provided in the relevant accounting policies and disclosures. The Group collaborates with various experts, including legal and valuation consultants, to ensure that appropriate assumptions are applied.
Page 28
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Analysis of turnover by country of destination:
Page 29
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The average monthly number of employees, including the directors, during the year was as follows:
The highest paid director's total compensation was £830,000 in 2023 (2022 - £650,879).
Page 30
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 31
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Factors that may affect future tax charges
In 2021 an increase in the corporation tax rate to 25% with effect from 1 April 2023 was substantively enacted. The 23.5% rate used above reflects 9 months of this new rate and 3 months of the previous rate of 19%. The 25% rate is used to measure UK deferred taxes in 2023 (and in 2022 to the extent the related timing differences were expected to reverse after 1 April 2023).
Page 32
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Deferred tax liability
Deferred tax liability
The Group has no unused tax losses or credits
The net reversal of deferred tax liabilities expected in 2024 is £36,655. This is expected to rise as the depreciation and amortisation is anticipated to be higher than the available capital allowances. The Group does not expect reversal of deferred tax asset in 2024.
Page 33
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 34
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 35
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 36
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The following were subsidiary undertakings of the Company:
All the above subsidiaries are included in the consolidation. The Company’s investment in Ballinger Markets Limited is indirect ownership. Management estimated the market value of the investments at historical cost less impairment. Management evaluates direct and indirect investments in subsidiaries for signs of impairment, focusing on each subsidiary’s ability to generate economic benefits as an independent cash-generating unit. As of the balance sheet date, the only cash-generating unit is Ballinger & Co. Ltd. Ballinger EU Limited and Ballinger Markets Limited became operational in 2024. After reviewing financial forecasts and considering both macroeconomic and microeconomic factors, management concluded that there are no indicators of impairment.
Page 37
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The aggregate of the share capital and reserves as at 31 December 2023 and the profit or loss for the year ended on that date for the subsidiary undertaking was as follows:
At the time the 2022 Annual Report and Financial Statements for the year ended 31 December 2022 of the Company were approved by the directors, the comparative aggregate figures for share capital and reserves, as well as profit/(loss), for Ballinger Group Holdings (Jersey) Limited and Ballinger Payments B.V. (Netherlands) were still in draft form.
The finalised aggregate figures for 2022 are as follows: - Share capital and reserves: (£83,031) for Ballinger Group Holdings (Jersey) Limited and (£2,100) for Ballinger Payments B.V. (Netherlands). - Profit/(loss): (£21,933) for Ballinger Group Holdings (Jersey) Limited and (£2,101) for Ballinger Payments B.V. (Netherlands).
Page 38
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
14.Debtors (continued)
Page 39
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Amounts owed by the Company are unsecured, interest-free, have no fixed date of repayment and are repayable on demand.
Trade creditors include business payable balances and client sell currency receivables, netted against client buy currency payables as of the reporting date. Client receivable and payable balances are offset on the basis that the asset is realised and the liability is settled simultaneously. Amounts owed by the Company are unsecured, interest-free, have no fixed repayment date, and are repayable on demand.
Page 40
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Financial assets and financial liabilities are recognised when the Group becomes party to the contractual provisions of the instrument.
A financial instrument is an agreement that creates a financial asset for one entity and a financial liability or equity interest for another. These instruments are recorded when the Group enters into the contractual terms associated with them. Their importance stems from their influence on a company’s financial condition, operational outcomes, and risk exposure. Key financial instruments for the Company typically include cash, bank deposits with trading bank counterparties, client margin accounts, trade receivables and payables, accruals, provisions, and derivatives instruments. Carrying values of financial instruments The following table sets out the carrying values of the main financial assets and financial liabilities.
Deposits held with trading bank counterparties are included in the Balance Sheet under 'Debtors: amounts receivable within one year'. Further details are provided in note 14.
Page 41
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Accruals are included on the Balance Sheet under 'Creditors: amounts falling due within one year'. Further details are provided in note 16.
Other provisions are shown on the Balance Sheet under non-current liabilities. Further details are available in note 17. Management believes that the carrying amounts of the above financial instruments closely approximate their fair values, primarily due to their short-term maturity. Offsetting financial instruments The Group offsets financial assets and liabilities, reporting the net amount on the balance sheet when an enforceable right to offset exist, and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously. The financial assets and liabilities subject to offsetting include client sell currency receivables and client buy currency payables as of the reporting date. These balances are offset based on the principle that the asset is realised and the liability is settled simultaneously. The net amounts are presented on the balance sheet under "Creditors: amounts falling due within one year."
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
On the reporting date, management modelled various scenarios and assessed the net cash flows required if open trades were terminated on different dates. The model assumed trades were settled at the Bank of England’s spot rates, with no changes to interest rates.
The model indicates that, in highly unlikely scenarios, the Group may incur minimal market losses. Where sufficient and reliable client data was available, management modelled early drawdown scenarios to assess expected gains or losses. The model was based on the remaining contract duration and assumed fixed monthly drawdowns. The analysis indicated a total reduction of £1,822,316 to account for potential losses from early drawdowns (2022: Nil). Capital management The Group manages its capital to ensure its ability to operate as a going concern while maximising returns. Additionally, it must manage its capital to comply with regulatory capital adequacy requirements. The capital structure comprises fully paid share capital, the share premium account, the share-based payment reserve, and retained earnings. The board periodically reviews and monitors the capital in alignment with management reporting processes.
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Share premium account
The share premium account includes any premiums received on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.
The retained earnings account includes all current and prior period retained profit and losses.
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Share options reserve
The Share options reserve represents the cumulative amounts charged to the profit and loss in respect of the share based payment arrangements detailed below. The cost of share-based payment is fully allocated to Ballinger & Co. Ltd on the bases that all eligible option holders are employees of Ballinger & Co. Ltd. The Company recognised full cost of share based payments as an investment in Ballinger & Co. Ltd. Two rounds of option grants were made, in 2021 and 2023 respectively, with the valuation and fixed exercise price per share agreed with HMRC for each round. The options are granted to eligible employees according to government-defined participation rules and company eligibility criteria. Management has established the conditions under which the options can be exercised. Further details regarding share-based payments are provided in Note 20.
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Basis of Valuation
The valuation is based on assessing the fair market value of the options on the grant dates. Market value is defined as the price an asset ‘might reasonably be expected to fetch on a sale in the open market,’ as per s272(1) of the Taxation of Chargeable Gains Act 1992. There are several valuation methodologies which may be used to value businesses including the price earnings method, the net asset method, the investment method, the discounted cashflow valuation, the dividend yield method and relative valuations. The management has adopted EBITDA (earnings before interest, tax, depreciation and amortisation) relative valuation method in valuing the Company. Relative valuation methods derive valuations by comparing financial characteristics of businesses. Turnover valuations are generally used to value businesses that have a steady level of turnover. Vesting requirements The options can be vested only on or following a listing, an asset sale or share sale in accordance with the term of the share option contracts. If the option holder ceased to hold employment, the directors shall have a discretion to permit option to be exercised to any extent or remain in force to such an extent and subject to such conditions of exercise as they shall determine.
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Maximum term of options granted
This option shall immediately lapse and cease to be exercisable on the expiry of ten years after the date of grant. Method of settlement The options are settled in the equity of Ballinger Group Holdings (UK) Ltd, the holding company of Ballinger & Co. Ltd. Basis of the cost allocation The cost of share-based payment is fully allocated to Ballinger & Co. Ltd on the bases that all eligible option holders are employees of Ballinger & Co. Ltd.
Investments
A prior period adjustment has been recognised for the capital contribution in a subsidiary in relation to equity settled share based arrangements for employees of a subsidiary. The total cumulative impact of this adjustment results in an increase of £41,640 in the investment related to the group equity settled scheme, along with a corresponding increase in the Share options reserve. Of the total adjustment, £18,613 pertains to the financial year ended 31 December 2021, while £23,027 relates to the financial year ended 31 December 2022. Other debtors Other debtors have been adjusted to reflect a £13,206 foreign exchange currency translation correction related to intercompany EUR balances and investment in a subsidiary. This correction had no impact on net assets.
Ballinger & Co. Ltd operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by Ballinger & Co. Ltd to the fund and amounted to £36,818 (2022 - £30,499). Contributions totalling £7,813 (2022 - £6,781) were payable to the fund at the balance sheet date and are included in creditors.
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
There is no ultimate controlling party.
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BALLINGER GROUP HOLDINGS (UK) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The Group was engaged in ongoing litigation with a former client as at 31 December 2023. Subsequent to year end, the parties reached a settlement agreement, and funds were received from the former client on 24 December 2024. The settlement will be reflected in the 2024 financial statements.
Subsequent events concerning the Group
Ongoing litigation In 2024, Ballinger & Co. Ltd signed a settlement agreement for an ongoing litigation, with the settlement proceeds received on 24 December 2024. No contingent asset was recognised during the reporting period. Dividend declaration Following professional guidance, Ballinger & Co. Ltd declared £1,700,000 dividends in January 2025 sufficient to offset the Company’s accumulated losses and establish adequate distributable reserves for the repurchase of its own shares. Subsequent events concerning the parent Company Repurchase of own shares In 2023, the Company attempted to repurchase its own shares from a shareholder for £300,000. A further repurchase from a Company director for a consideration of £0.0001 was attempted in 2024. After reviewing these transactions and obtaining legal advice, the Directors determined that the Company did not have sufficient distributable reserves at the time of the buybacks, rendering both repurchases void. The buybacks were successfully completed in January 2025 for the original considerations of £300,000 and £0.0001, respectively. No other significant events occurred after the balance sheet date and before the issuance of the financial statements that would have a material impact on the financial results of the Group or the Company.
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