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Registered number: 08812852












FRONTERA CAPITAL LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

 

FRONTERA CAPITAL LIMITED
 
COMPANY INFORMATION


Director
Vicente Pons 




Registered number
08812852



Registered office
120 Pall Mall
4th Floor

C/O Trustmoore (UK) Ltd

London

SW1Y 5EA




Independent auditor
Blick Rothenberg Audit LLP
Chartered Accountants & Statutory Auditor

16 Great Queen Street

Covent Garden

London

WC2B 5AH





 

FRONTERA CAPITAL LIMITED

CONTENTS



Page
Strategic report
1 - 3
Director's report
4 - 5
Independent auditor's report
6 - 9
Profit and loss account
10
Balance sheet
11
Statement of changes in equity
12
Statement of cash flows
13
Notes to the financial statements
14 - 22


 

FRONTERA CAPITAL LIMITED
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024

Introduction
 
The director presents his strategic report for the year ended 31st December 2024.

Business review
 
In October 2016, Frontera Capital Group (FCG) decided to expand its infrastructure by incorporating a new entity in Abu Dhabi Global Markets (ADGM), Frontera Capital Group Limited (FCGL). FCGL is now regulated by ADGM’s Financial Services Regulatory Authority (FSRA). FCGL’s regulator required a division of the origination and marketing functions within FCGL and this requirement was addressed by positioning arranging deals in investments by way of marketing activities in Frontera Capital Limited (FCL).
Turnover in the year was £180,000 with an increase from 2023 (£50,000). Operating expenses  increased in 2024 from £54,874 to £246,194, resulting in a net loss for the year of £46,617. The balance sheet net current assets of FCL decreased from £172,266 in 2023 to £125,649  in 2024.
It is expected that the revenue generation capacity of FCL will increase during 2025, after 4 years of static performance. This increase is expected to be driven from an increase in transactions and a drive to diversify the client base by marketing to new clients.

Principal risks and uncertainties
 
Business Risk
There are systemic risks faced by investment banking companies focused in frontier markets as well as idiosyncratic ones, primarily driven by the division of responsibilities within Frontera Capital between Frontera Capital Limited and Frontera Capital Group Limited.
Systemic Risk
Systemic risks would include a general economic slowdown or “flight to quality” of investment away from more risky markets like frontier markets and towards more stable developed markets in Europe and the U.S. The outlook for frontier markets is positive for 2022 due to the low interest rates observed in stable developed markets. However, due to recent inflation concerns and rate hikes from various central banks, investors are more reserved with regards to new investing. The COVID-19 pandemic did not negatively impact the business and revenue growth is expected in 2025. Our investors still demand high returns from frontier markets and we also have a strong pipeline of deals ready to be marketed.
As far as idiosyncratic risks are concerned, Frontera Capital Limited (FCL) has not yet been able to secure large enough mandates (beyond USD 150 million) that would require a significant marketing or syndication effort, which has limited the role of a pure transaction marketing company such as Frontera Capital Limited. Loss of key personnel in other group companies could be a risk, but the key members of the senior management team have been working together for a long time and will likely continue to do so.
Liquidity Risk
Liquidity levels at FCL are high, with 95% of total assets in cash in the bank accounts of the company.
Additionally, other FCG entities have significant liquidity that can be used to support FCL should the minimum capital levels set by the FCA become low.
Credit Risk
The company has limited credit risk as sales invoices are usually paid within agreed payment terms and there have been no bad debts in the last five years. Additionally, in the highly unlikely event that customers did default, the capital levels of FCL would be able to absorb this loss. And again, other FCG entities have significant liquidity that can be used to support FCL should the minimum capital levels set by the FCA become low.

 
Page 1

 

FRONTERA CAPITAL LIMITED

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024


Market and Interest Rate Risk
FCL is exposed to minimal market and interest rate risk, as liabilities on its balance sheet represent less than 20% of total assets, are denominated in GBP and do not have a corresponding interest rate charge against them should they not be paid on time. The limited market risk that FCL is exposed to would be the appreciation or depreciation in the exchange rate of USD against GBP as 5% of its liquid assets are held in USD.
Operational Risk
The risk of loss to FCL from failed internal processes or systems is low, as there are sufficient controls around the accounting, approval and execution of expenses, which represents almost all of the flows in and out of FCL.
Regulatory Risk
The FCA has proven itself to be a stable and consistent regulator, adopting international norms in prudential regulation and vetting regulations with the public before promulgating most new regulation. Therefore, there is only a limited risk that the FCA would implement regulatory changes that would have a significant impact on FCL’s business. Additionally, given the small scale of operations in FCL relative to operations in other markets, any regulatory changes that would have a negative impact would not likely impact the broader Frontera Capital enterprise and thus is again not a significant concern for the Frontera group.

Financial key performance indicators
 
Income of £180,000 was achieved in the year. Some marketing effort has returned to the U.K. at the end of 2024 as FCL ramps up its European marketing efforts. Compliance with Regulatory Norms: achieved target of 100% compliant and 2024 expectations are to be 100% compliant in the UK.
Minimum Cash Balance: a balance of £124,968 (target > £100,000).

Other key performance indicators
 
Frontera Capital Limited’s central tenet is that where hard currency asset valuations are far more stretched than those denominated in local currencies, the latter should continue to attract investor risk appetite. This is likely to be more apparent with respect to frontier and emerging debt markets, especially for those able to offer strong cyclical growth and other attractive credit metrics – such as smaller external funding needs, lower government budget deficits, stabilizing national debt levels and economic diversification strategies – as well as sizeable term premia.
In fixed income terminology, FCL’s view is that this is likely to be best captured in four switches: (1) from lower yielding hard currency to higher yielding local currency assets; (2) from lower yielding short term to higher yielding long term duration; (3) from more richly valued established emerging markets to less valued frontier market assets and (4) from lower yielding sovereign assets to higher yielding sub-sovereign and corporate assets.

Director's statement of compliance with duty to promote the success of the Company
 
The director works closely with key personnel within the group to ensure key decisions taken are to the benefit of the company’s parent company and wider group. The director maintains a good relationship with the company’s customer and appoints personnel with appropriate skills to deal with legal and regulatory matters to safeguard the company’s reputation.

Page 2

 

FRONTERA CAPITAL LIMITED

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024


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



Vicente Pons
Director

Date: 17 April 2025

Page 3

 

FRONTERA CAPITAL LIMITED

DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024

The director presents his report and the financial statements for the year ended 31 December 2024.

Results and dividends

The loss for the year, after taxation, amounted to £75,785 (2023 - loss £3,947).

No ordinary dividends were paid. The director does not recommend payment of a final dividend. No preference dividends were paid.

Director

The director who served during the year was:

Vicente Pons 

Director's responsibilities statement

The director is responsible for preparing the strategic report, the director's report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the director is required to:


select suitable accounting policies for the Company'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 Company will continue in business.

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

Engagement with suppliers, customers and others

The director is in regular contact with the company’s clients and business partners to maintain the good relationships which has been built over a number of years. The director has appointed personnel with appropriate skills to deal with legal and regulatory matters to safeguard the company’s reputation.

Greenhouse gas emmissions, energy consumption and energy efficiency action

The Company has consumed less than 40MWh during the year and therefore is considered a low energy user. Energy and carbon information is not disclosed for that reason.

Page 4

 

FRONTERA CAPITAL LIMITED

DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024

Matters covered in the Strategic report

As permitted by s414c(11) of the Companies Act 2006, the director has 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.

Disclosure of information to auditor

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

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

Auditor

The auditor, Blick Rothenberg Audit LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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





Vicente Pons
Director

Date: 17 April 2025

Page 5

 

FRONTERA CAPITAL LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF FRONTERA CAPITAL LIMITED
 FOR THE YEAR ENDED 31 DECEMBER 2024

Opinion


We have audited the financial statements of Frontera Capital Limited (the 'Company') for the year ended 31 December 2024, which comprise the profit and loss account, the balance sheet, the statement of cash flows, the statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 December 2024 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


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


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.


Page 6

 

FRONTERA CAPITAL LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF FRONTERA CAPITAL LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024

Other information


The other information comprises the information included in the Annual Report other than the financial statements and our auditor's report thereon. The director is responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


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


Responsibilities of directors
 

As explained more fully in the director's responsibilities statement set out on page 4, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the director is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 7

 

FRONTERA CAPITAL LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF FRONTERA CAPITAL LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024

Auditor's responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, and non- compliance with laws and regulations, our procedures included the following: enquiring of management concerning the Company’s policies with regards identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; enquiring of management concerning the Company’s policies for detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; enquiring of management concerning the Company’s policies in relation to the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations; discussing among the engagement team where fraud might occur in the financial statements and any potential indicators of fraud; and obtaining an understanding of the legal and regulatory framework that the Company operates in and focusing on those laws and regulations that had a direct effect on the financial statements or that had a fundamental effect on the operations of the Company. The key laws and regulations we considered in this context included the UK Companies Act 2006, the Financial Services and Markets Act 2000 and applicable tax legislation.
One particular focus area was the risk of fraud through management override of controls. Our procedures to respond to risks identified included the following: performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; reviewing the bank statements of the Company for evidence of any large or unusual activity which may be indicative of fraud; enquiring of management in relation to any potential litigation and claims; and testing the appropriateness of journal entries and other adjustments.


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 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 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an 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.


Page 8

 

FRONTERA CAPITAL LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF FRONTERA CAPITAL LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024




Richard Hinton (senior statutory auditor)
  
for and on behalf of
Blick Rothenberg Audit LLP
 
Chartered Accountants
Statutory Auditor
  
16 Great Queen Street
Covent Garden
London
WC2B 5AH

17 April 2025
Page 9

 

FRONTERA CAPITAL LIMITED
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2024

2024
2023
Note
£
£

  

Turnover
 4 
180,000
50,000

Gross profit
  
180,000
50,000

Administrative expenses
  
(246,194)
(54,874)

Operating loss
  
(66,194)
(4,874)

Tax (charge)/credit for the year
 7 
(9,591)
927

Loss for the financial year
  
(75,785)
(3,947)

The notes on pages 14 to 22 form part of these financial statements.

Page 10


 
REGISTERED NUMBER:08812852
FRONTERA CAPITAL LIMITED

BALANCE SHEET
AS AT 31 DECEMBER 2024

2024
2023
Note
£
£

  

Current assets
  

Debtors: amounts falling due within one year
 8 
28,805
9,591

Cash at bank and in hand
 9 
124,968
197,233

  
153,773
206,824

Creditors: amounts falling due within one year
 10 
(57,292)
(34,558)

Net current assets
  
 
 
96,481
 
 
172,266

Total assets less current liabilities
  
96,481
172,266

  

Net assets
  
96,481
172,266


Capital and reserves
  

Called up share capital 
 12 
120,000
120,000

Profit and loss account
 13 
(23,519)
52,266

  
96,481
172,266


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




Vicente Pons
Director

The notes on pages 14 to 22 form part of these financial statements.

Page 11

 

FRONTERA CAPITAL LIMITED

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


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 January 2023
120,000
56,213
176,213


Comprehensive income for the year

Loss for the year

-
(3,947)
(3,947)



At 1 January 2024
120,000
52,266
172,266


Comprehensive income for the year

Loss for the year

-
(75,785)
(75,785)


At 31 December 2024
120,000
(23,519)
96,481


The notes on pages 14 to 22 form part of these financial statements.

Page 12

 

FRONTERA CAPITAL LIMITED

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024

2024
2023
£
£

Cash flows from operating activities

Loss for the financial year
(75,785)
(3,947)

Adjustments for:

Taxation credit
9,591
(927)

(Increase)/decrease in debtors
(28,805)
50,000

(Decrease) in creditors
(12,611)
(6,035)

Increase in amounts owed to related parties
35,345
-

Net cash generated from operating activities

(72,265)
39,091




Net (decrease)/increase in cash and cash equivalents
(72,265)
39,091

Cash and cash equivalents at beginning of year
197,233
158,142

Cash and cash equivalents at the end of year
124,968
197,233


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
124,968
197,233

124,968
197,233


Page 13

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

1.


General information

Frontera Capital Limited (the "Company") is a private company limited by shares incorporated in England and Wales. The registered office and principal place of business is 4th Floor, C/O Trustmoore (UK) Ltd, 120 Pall Mall, London, United Kingdom, SW1Y 5EA. 
The principal activity of the Company continued to be the provision of structured financial services.
The financial statements are presented in Sterling (GBP).

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

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 (see note 3).

The following principal accounting policies have been applied:

 
2.2

Going concern

After making enquiries, the director has a reasonable expectation that the company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date these financial statements were approved. Accordingly, he continues to adopt the going concern basis in preparing the financial statements.

 
2.3

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

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

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

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

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss account within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

Page 14

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. 
Revenue relates to success and marketing fees and other income which is recognised in the period in which the services are provided.

 
2.5

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

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.

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.

 
2.6

Cash and cash equivalents

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


 
2.7

Provisions for liabilities

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.

Page 15

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

 
2.8

Financial instruments

The company 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 company 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 company after deducting all of its liabilities. 
The company’s policies for its major classes of financial assets and financial liabilities are set out below. 
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.
Financial liabilities
Basic financial liabilities, including trade and other creditors 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 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.
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 company 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.
 
Page 16

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)


2.8
Financial instruments (continued)


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.

 
2.9

Share Capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

in the application of the company's accounting policies, the director is 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 company's main accounting estimate is the level of accrued income for which provision is only made if the revenue recognition criteria have been met. No such provisions were required in 2024 or 2023. 


4.


Turnover

The whole of the turnover is attributable to the provision of group services.
All turnover arose from activities with the parent company based in the United Arab Emirates. 

Page 17

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

5.


Auditor's remuneration

2024
2023
£
£

Fees payable to the Company's auditor and its associates for the audit of the Company's financial statements
16,800
16,800

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

All other assurance services
4,800
4,800

6.


Employees

2024
2023
£
£

Wages and salaries
199,325
20,000

Social security costs
-
2,551

199,325
22,551


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


        2024
        2023
            No.
            No.







Professional
1
1

No remuneration was paid to directors in 2024 or 2023.

Page 18

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

7.


Taxation


2024
2023
£
£



Total current tax
-
-

Deferred tax


Origination and reversal of timing differences
9,591
(927)

Total deferred tax
9,591
(927)


Taxation on profit/(loss) on ordinary activities
9,591
(927)
As at the 31 December 2023, the Company recognised a deferred tax asset to the amount of £9,591 resulting from the unutilised tax losses carried forward. Due to continued uncertainty around the timing of future taxable profits the deferred tax asset has been derecognised in the year. The Company as at 31 December 2024 has unutilised carried forward tax losses amounting to £116,671 which can be offset against future taxable profit. 


Factors affecting tax charge for the year

The tax assessed for the year is the same as (2023 - the same as) the standard rate of corporation tax in the UK of 25% (2023 - 19%) as set out below:

2024
2023
£
£


Loss on ordinary activities before tax
(66,194)
(4,874)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19%)
-
(927)

Effects of:


Other timing differences leading to an increase (decrease) in taxation
9,591
-

Total tax charge for the year
9,591
(927)


8.


Debtors

2024
2023
£
£


Trade debtors
28,353
-

Prepayments and accrued income
452
-

Deferred taxation assets
-
9,591

28,805
9,591

Page 19

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

8.Debtors (continued)



9.


Cash and cash equivalents

2024
2023
£
£

Cash at bank and in hand
124,968
197,233

124,968
197,233



10.


Creditors: Amounts falling due within one year

2024
2023
£
£

Amounts owed to parent company
35,345
-

Other taxation and social security
-
9,441

Accruals and deferred income
21,947
25,117

57,292
34,558



11.


Deferred taxation




2024


£






At beginning of year
9,591


Charged to profit or loss
(9,591)



At end of year
-

The deferred tax asset is made up as follows:

2024
2023
£
£


Tax losses carried forward
-
9,591

-
9,591

Page 20

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

12.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



10,000 (2023 - 10,000) Ordinary shares of £1.00 each
10,000
10,000
110,000 (2023 - 110,000) Preference shares shares of £1.00 each
110,000
110,000

120,000

120,000

The company has one class of ordinary share of which 10,000 are in issue with a par value of £1.
The company also has in issue 110,000 preference shares of £1 each which are non-voting and redeemable at the option of the company. 
In all other respects, both share classes rank pari passu. Dividends are paid at the discretion of the director and the shares do not have any fixed rights to a dividend. The company may declare a dividend in respect of one class but not the other or declare dividends at different rates for each class.



13.


Reserves

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses.

14.


Analysis of net debt





At 1 January 2024
Cash flows
Other non-cash changes
At 31 December 2024
£

£

£

£

Cash at bank and in hand

197,233

(72,265)

-

124,968

Debt due within 1 year

-

-

(35,345)

(35,345)


197,233
(72,265)
(35,345)
89,623


15.


Related party transactions

The company has taken advantage of the exemption contained in FRS 102 section 33 "Related Party Disclosures" from disclosing transactions with entities which are a wholly owned part of the group.
Transactions with other related parties are as follows:
Other creditors includes £34,345 (2023: £nil) payable to the parent company Frontera Capital Group Limited. The loan is interest free and repayable on demand.

Page 21

 

FRONTERA CAPITAL LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

16.


Post-balance sheet event

Post year-end during March 2025, Frontera Capital Limited signed an agreement with Frontera Capital Group Limited whereby the staff loan receivable was assigned to Frontera Capital Group Limited. The resultant impact meant that the related party loan would therefore in effect be fully paid when the agreement was signed.  


17.


Controlling party

The parent undertaking is Frontera Capital Group Limited which is incorporated in the United Arab Emirates. The ultimate controlling party is Vicente Pons. Consolidated financial statements are not produced by the parent company.

Page 22