|
Registered number: 06358081
PROVENTEQ LIMITED
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
PROVENTEQ LIMITED
CONTENTS
|
|
|
|
|
|
|
|
|
|
|
|
Directors' responsibilities statement
|
|
Independent auditor's report
|
|
Consolidated statement of comprehensive income
|
|
Consolidated balance sheet
|
|
|
|
|
Consolidated statement of changes in equity
|
|
Company statement of changes in equity
|
|
Consolidated statement of cash flows
|
|
Notes to the financial statements
|
|
|
|
PROVENTEQ LIMITED
COMPANY INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reading Enterprise Centre
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Blick Rothenberg Audit LLP
|
|
|
Chartered Accountants & Statutory Auditor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVENTEQ LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
The directors present their strategic report for Proventeq Limited and its subsidiary undertakings (collectively, “the Group” or “Proventeq”) for the year ended 31 August 2024.
The principal activity of the Group is to provide products and services for enabling AI-powered Information Management and Digital Transformation for customers worldwide.
The financial year ended 31 August 2024 (FY24), saw substantial revenue growth from £8.1m to £10.1m, a growth rate of 24.7% driven by continued demand from existing customers and new customer wins globally.
The Group closed the year with £4.25m in cash on the balance sheet (2023: £3.03m), creating sufficient cash reserves for investment in long-term growth.
Proventeq is committed to achieving sustainable long-term growth by investing in technological innovation and its talented workforce. In FY24, Proventeq was awarded the Best Performing Company in Information Management by Megabuyte, as part of their Megabuyte50 awards.
Recognising that its employees are fundamental to success, Proventeq consistently promotes a culture of collaboration and professional development. In addition, Proventeq actively engages in environmental, social, and governance (ESG) initiatives, ensuring its operations adhere to global sustainability standards and make positive contributions to the communities it serves.
Key performance indicators
|
Principal risks and uncertainties
|
The directors have identified the key risks and uncertainties for the Group. This list is neither exhaustive nor ranked in order of importance. The Group has sought to manage or mitigate these risks where possible.
Macroeconcomic environment
The volatile economic conditions, shaped by high interest rates and geopolitical tensions, have impacted consumer sentiment, resulting in reduced expenditure and delayed project investments.
The Group is widening the addressable market by diversifying revenue streams, building deeper relationships with existing customers, and focusing on increasing recurring revenue to reduce exposure to market volatility. The Group seeks to maintain liquidity reserves as a crucial means to ensure financial flexibility during unstable periods.
Foreign currency risks
The Group has foreign subsidiaries and customers in over 30 countries, which gives rise to potential foreign exchange risks due to the currency volatility.
The Group conducts transactions in local currencies when feasible and closely monitors currency trends to enable proactive adjustments to pricing and operational strategies, thereby mitigating these fluctuations.
|
|
PROVENTEQ LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
Cyber and information security risks
The increasing sophistication of cyber threats, including phishing, malware, and insider attacks, can jeopardise sensitive data and disrupt operations, posing significant financial and reputational harm.
To mitigate risks, Proventeq is adopting multi-layered security frameworks, conducting regular penetration testing, and implementing employee awareness programs to strengthen its defences against threats. Proventeq is Cyber Essentials Plus certified and seeks to collaborate with cybersecurity experts and leverage AI-driven monitoring tools to ensure timely detection and response to vulnerabilities.
Environmental and social responsibility
|
Proventeq reduced its carbon emissions this year through investment in energy-efficient equipment. Additionally, Proventeq is actively exploring partnerships with green technology enterprises to further its environmental impact.
On the social responsibility front, the company continues to support local education initiatives by engaging in work experience and internship programs, and fostering partnerships with local schools and educational institutions. Furthermore, the company prioritises diversity and inclusion within its workforce by implementing hiring practices aimed at promoting equality and supporting underrepresented groups.
Proventeq has strengthened its corporate governance framework to navigate evolving global regulations effectively. Additionally, the company successfully renewed its ISO 27001 certification, showcasing its commitment to maintaining robust information security standards and protecting client data with utmost diligence.
Overall, these environmental, social, and governance (ESG) initiatives demonstrate the Group's commitment to promoting sustainable growth, empowering communities, and upholding ethical practices in alignment with its long-term vision.
During FY24, Proventeq commenced the process of obtaining external investment from the British Growth Fund (BGF), with the objective of enhancing its portfolio and supporting expansion in key regions, including the United Kingdom, the United States, Europe, and the Middle East.
The external investment was successfully secured on 29 October 2024, with a strategic emphasis on increasing recurring revenue. Proventeq plans to leverage the partnership with BGF to capitalize on opportunities in data management, compliance, and AI solutions by introducing new products and services that cater to emerging customer demands and align with industry trends.
Compliance and Governance: As regulatory landscapes continue to evolve globally, Proventeq is developing product modules and services designed to enhance compliance and governance capabilities.
Data & AI: Proventeq is expanding its expertise in Data & AI by focusing on intelligent data solutions that drive actionable insights and empower organisations to achieve heightened operational efficiency and strategic advantages. The Data & AI solutions will focus on helping organisations become ready for AI adoption by modernising their data platforms, implementing automation to refine data processing, and utilising cutting-edge AI technologies for real-time analytics and more intelligent decision-making.
Managed Services: Recognising the growing demand for reliable operational support, Proventeq aims to enhance its managed services portfolio. These offerings will encompass comprehensive end-to-end solutions for IT and business workflows, including proactive system monitoring, maintenance, and support tailored to meet each client’s unique requirements, ensuring optimal performance and continuity.
By investing in these areas, Proventeq reaffirms its commitment to innovation, customer-centricity, and delivering solutions that enable sustainable business growth.
|
|
PROVENTEQ LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
This report was approved by the board and signed on its behalf.
|
|
PROVENTEQ LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
The directors present their report and the financial statements of Proventeq Limited (the "company") and its subsidiaries (together the "group") for the year ended 31 August 2024.
The group, which comprises the company and its subsidiaries, Proventeq MEA FZ-LLC, Proventeq Inc. and Proventeq India Private Limited, provides software products and services.
The profit for the year, after taxation, amounted to £838,948 (2023 - £1,057,603).
Dividends totalling £525,000 (2023: £150,000) were declared and paid during the year.
The directors who served during the year were:
Disclosure of information to auditor
|
Each of the persons who are directors at the time when this directors' report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the company and the group's auditor is unaware, and
∙the director 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 and the group's auditor is aware of that information.
Post balance sheet events
|
On 28 October 2024, the ordinary share capital of Proventeq Limited was acquired by Project Proago Limited.
This report was approved by the board and signed on its behalf.
|
|
PROVENTEQ LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 AUGUST 2024
The directors are responsible for preparing the group strategic report, the directors' report and the consolidated 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 judgements 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.
|
|
PROVENTEQ LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROVENTEQ LIMITED
FOR THE YEAR ENDED 31 AUGUST 2024
We have audited the financial statements of Proventeq Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 August 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and Consolidated Statement of Cash Flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
∙give a true and fair view of the state of the group's and of the parent company's affairs as at 31 August 2024 and of the group's profit 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.
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 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 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 or 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.
|
|
PROVENTEQ LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROVENTEQ LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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 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.
Matters on which we are required to report by exception
|
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the group strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
∙the parent company financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of directors' 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 directors' responsibilities statement set out on page 6, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.
|
|
PROVENTEQ LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROVENTEQ LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
∙the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
∙we identified the laws and regulations applicable to the company through discussions with directors and
other management, and from our commercial knowledge and experience of the company's sector;
∙we focused on specific laws and regulations which we considered may have a direct material effect on the
financial statements or the operations of the company, including the Companies Act 2006 and taxation
legislation;
∙we assessed the extent of compliance with the laws and regulations identified above through making
enquiries of management and inspecting legal correspondence; and
∙identified laws and regulations were communicated within the audit team regularly and the team remained
alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including
obtaining an understanding of how fraud might occur, by:
∙making enquiries of management as to where they considered there was susceptibility to fraud, their
knowledge of actual, suspected and alleged fraud; and
∙considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and
regulations.
To address the risk of fraud through management bias and override of controls, we:
∙performed analytical procedures to identify any unusual or unexpected relationships;
∙tested a sample of journal entries to identify unusual transactions;
∙assessed whether judgements and assumptions made in determining the accounting estimates were
indicative of potential bias; and
∙investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
∙agreeing financial statement disclosures to underlying supporting documentation;
∙reading the minutes of meetings of those charged with governance;
∙enquiring of management as to actual and potential litigation and claims; and
∙reviewing correspondence with HM Revenue and Customs.
|
|
PROVENTEQ LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROVENTEQ LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
There are inherent limitations in our audit procedures described above. The more removed that laws and
regulations are from financial transactions, the less likely it is that we would become aware of non-compliance.
Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations
to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if
any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they
may involve deliberate concealment or collusion.
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.
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.
Mahmood Ramji (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
Date: 29 May 2025
|
|
PROVENTEQ LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest receivable and similar income
|
|
|
|
Interest payable and similar expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the financial year
|
|
|
|
|
|
|
|
|
Currency translation differences
|
|
|
|
Total comprehensive income for the year
|
|
|
|
Profit for the year attributable to:
|
|
|
|
Owners of the parent company
|
|
|
|
|
|
|
|
|
Total comprehensive income for the year attributable to:
|
|
|
|
Owners of the parent company
|
|
|
|
|
|
|
|
|
The notes on pages 17 to 34 form part of these financial statements.
|
|
|
|
|
REGISTERED NUMBER:06358081
|
PROVENTEQ LIMITED
CONSOLIDATED BALANCE SHEET
AS AT 31 AUGUST 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debtors: amounts falling due within one year
|
|
|
|
|
|
Current asset investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Creditors: amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets less current liabilities
|
|
|
|
|
|
Creditors: amounts falling due after more than one year
|
|
|
|
|
|
Provisions for liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 34 form part of these financial statements.
|
|
|
|
REGISTERED NUMBER:06358081
|
PROVENTEQ LIMITED
COMPANY BALANCE SHEET
AS AT 31 AUGUST 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debtors: amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Creditors: amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets less current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Creditors: amounts falling due after more than one year
|
|
|
|
|
|
Provisions for liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 34 form part of these financial statements.
|
|
PROVENTEQ LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income for the year
|
|
|
|
|
|
|
|
|
|
|
Currency translation differences
|
|
|
|
|
Contributions by and distributions to owners
|
|
|
|
|
Dividends: Equity capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income for the year
|
|
|
|
|
|
|
|
|
|
|
Currency translation differences
|
|
|
|
|
Contributions by and distributions to owners
|
|
|
|
|
Dividends: Equity capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The notes on pages 17 to 34 form part of these financial statements.
|
|
|
PROVENTEQ LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income for the year
|
|
|
|
|
|
|
|
|
Contributions by and distributions to owners
|
|
|
|
Dividends: Equity capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income for the year
|
|
|
|
|
|
|
|
|
Contributions by and distributions to owners
|
|
|
|
Dividends: Equity capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The notes on pages 17 to 34 form part of these financial statements.
|
|
|
PROVENTEQ LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 AUGUST 2024
Cash flows from operating activities
|
|
|
Profit for the financial year
|
|
|
|
|
|
|
Amortisation of intangible assets
|
|
|
Depreciation of tangible assets
|
|
|
Profit on disposal of tangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash generated from operating activities
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
Purchase of tangible fixed assets
|
|
|
Sale of tangible fixed assets
|
|
|
|
|
|
|
Acquisition of a subsidiary, net of cash acquired
|
|
|
Net cash from investing activities
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in financing activities
|
|
|
Net increase in cash and cash equivalents
|
|
|
Cash and cash equivalents at beginning of year
|
|
|
Cash and cash equivalents at the end of year
|
|
|
|
|
|
|
Cash and cash equivalents at the end of year comprise:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The notes on pages 17 to 34 form part of these financial statements.
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
Proventeq Limited is a private company limited by shares incorporated in England and Wales. The address of its registered office is Reading Enterprise Centre, Whiteknights Road, Reading, Berkshire, England, RG6 6BU.
The 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 £.
2.Accounting policies
|
|
|
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 group management to exercise judgement in applying the group's accounting policies.
The company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own statement of comprehensive income in these financial statements.
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 statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.
After making enquiries, the directors have a reasonable expectation that the group 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, they continue to adopt the going concern basis in preparing the financial statements.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
2.Accounting policies (continued)
|
|
|
Foreign currency translation
|
Functional and presentation currency
The company's functional and presentational currency is Sterling (£).
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 'interest receivable and similar income' and 'interest
payable and similar expenses'. All other foreign exchange gains and losses are presented in profit or
loss within operating activities.
On consolidation, the results of overseas operations are translated into the functional currency using the exchange rates approximating to those at the dates of the transactions. All assets and liabilities of the overseas operations are translated using the closing rate. Exchange differences arising on translating the opening net assets of the overseas operations at the opening rate and the results of overseas operations at spot exchange rates are recognised in other comprehensive income.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the group 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. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the group will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period, with reference to agreed milestones, can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
Sale of licenses
Revenue from the sale of product licences is recognised over the period to which the licence relates.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
2.Accounting policies (continued)
|
|
|
Operating leases: the group as lessee
|
Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
Interest income is recognised in profit or loss using the effective interest method.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Defined contribution pension plan
The group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the group pays fixed contributions into a separate entity. Once the contributions have been paid the group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the group in independently administered funds.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
2.Accounting policies (continued)
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
At each reporting date the company 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.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, with the basis set out below:
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
|
|
|
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.
In the consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the group's cash management.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
2.Accounting policies (continued)
|
|
|
Provisions for liabilities
|
Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Increases in provisions are generally charged as an expense to profit or loss.
The group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
Impairment of financial assets
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
2.Accounting policies (continued)
|
|
|
Financial instruments (continued)
|
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the group will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders.
Ordinary shares are classified as equity.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
2.Accounting policies (continued)
|
|
|
Current and deferred taxation
|
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.
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.
|
|
|
|
|
The operating profit is stated after charging:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Defined contribution pension costs
|
|
|
|
|
|
|
|
|
|
Research and development charged as an expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of tangible fixed assets
|
|
|
|
|
Amortisation of intangible fixed assets
|
|
|
|
|
(Profit)/loss on sale of tangible assets
|
|
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
|
|
|
Staff costs, including directors' remuneration, were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of defined contribution scheme
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The average monthly number of employees, including the directors, during the year was as follows:
|
|
|
|
|
|
|
|
Contributions to defined contribution pension scheme
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During the year retirement benefits were accruing to three directors (2023 - three) in respect of defined contribution pension schemes.
|
|
|
Other interest receivable
|
|
|
|
|
|
|
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
Interest payable and similar expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current tax on profits for the year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origination and reversal of timing differences
|
|
|
|
|
|
|
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
8.Taxation (continued)
|
|
Factors affecting tax charge for the year
|
|
|
The tax assessed for the year is lower than (2023 -lower than) the standard rate of corporation tax in the UK of 25% (2023 - 21.52%). The differences are explained below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit on ordinary activities before tax
|
|
|
|
|
Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 21.52%)
|
|
|
|
|
|
|
|
|
|
Non-tax deductible amortisation of goodwill and impairment
|
|
|
|
|
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
|
|
|
|
|
Depreciation for the year in excess of capital allowances
|
|
|
|
|
Utilisation of tax losses
|
|
|
|
|
Tax deduction arising from qualifying research and development expenditure
|
|
|
|
|
Unrelieved tax losses carried forward
|
|
|
|
|
Movement in deferred taxation
|
|
|
|
|
Other differences leading to an increase (decrease) in the tax charge
|
|
|
|
|
Total tax charge for the year
|
|
|
|
|
Factors that may affect future tax charges
|
There were no factors that may affect future tax charges.
|
|
Dividends declared and paid
|
|
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
The negative goodwill arose on the acquisition of Proventeq MEA FZ-LLC on 4 October 2022. The carrying value of the negative goodwill is £15,263 (2023: £29,351) and has a remaining amortisation period of 13 months.
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
11.Tangible fixed assets (continued)
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
Investments in subsidiary companies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following were subsidiary undertakings of the company:
|
|
|
|
|
|
|
|
|
|
160 Greentree Drive, Suite 101, Dover DE19904, USA
|
|
|
|
|
Proventeq India Private Limited
|
Tower S4, Office #104, Cybercity, Magarpatta, Hadapsar, Pune, Maharashtra 411028, India
|
|
|
|
|
|
Dubai Studio City, Commercial Building 1, 4th floor Dubai, 73000, UAE
|
|
|
|
|
The trade of all subsidiary undertakings was consistent with the group's principal activities.
A non-controlling interest holds 1 of the 50,000 ordinary shares in Proventeq India Private Limited. The holding of the company is therefore 99.998%.
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed by group undertakings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepayments and accrued income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current asset investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Creditors: Amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed to group undertakings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other taxation and social security
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accruals and deferred income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
|
|
Creditors: Amounts falling due after more than one year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of the maturity of loans is given below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts falling due 1-2 years
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charged to the profit or loss
|
|
|
|
|
|
|
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
18.Deferred taxation (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charged to the profit or loss
|
|
|
|
|
|
|
|
|
The deferred taxation balance is made up as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated capital allowances
|
|
|
|
|
|
|
Tax losses carried forward
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allotted, called up and fully paid
|
|
|
|
|
|
|
|
|
|
|
|
100,009 (2023 - 100,009) Ordinary shares of £1.00 each
|
|
|
|
|
There is a single class of ordinary shares. There are no restrictions on the distribution of dividends and
the repayment of capital.
The holders of ordinary shares are entitled to one vote per share at meetings of the company.
|
Foreign exchange reserve
The foreign currency reserve is a non-distributable reserve arising from the consolidation of the financial statements of subsidiaries whose functional currency is different to the group reporting currency.
Profit and loss account
The profit and loss account includes all current and prior period retained profits and losses.
|
|
PROVENTEQ LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
The company 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 the company to the fund and amounted to £37,080 (2023: £34,967). Contributions totalling £12,018 (2023: £8,141) were payable at the balance sheet date and are included in creditors.
|
|
Commitments under operating leases
|
|
|
At 31 August 2024 the group and the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Later than 1 year and not later than 5 years
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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:
|
|
|
|
Amount due (to)/from related parties
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed to related parties are unsecured, interest free and due for repayment within one year.
Dividends of £225,000 (2023: £150,000) were paid to the directors in the year and dividends of £300,000 (2023: £Nil) were paid to close family members of the directors.
|
|
Post balance sheet events
|
On 28 October 2024, the ordinary share capital of Proventeq Limited was acquired by Project Proago Limited.
The directors consider there to be no ultimate controlling party.
|
|
|