Company registration number 06182332 (England and Wales)
SYSTEMATICS INTERNATIONAL LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
SYSTEMATICS INTERNATIONAL LIMITED
COMPANY INFORMATION
Directors
MM Bhatt
PS McDowell
Company number
06182332
Registered office
Kynetec
Western Court
Weston
Newbury
Berkshire
RG20 8JE
Auditor
Rickard Luckin Limited
1st Floor
19 Clifftown Road
Southend-On-Sea
Essex
SS1 1AB
SYSTEMATICS INTERNATIONAL LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12 - 23
SYSTEMATICS INTERNATIONAL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 1 -
The directors present the strategic report for the year ended 30 September 2024.
Principal activities
Systematics International Limited is a multi-award-winning global software development, data gathering and data analytics business who aggregate and report European machinery registrations and global machinery shipments for the benefit of agricultural machinery manufacturers and dealers.
On 8th June 2023, Kynetec UK Limited acquired Systematics International Limited.
Kynetec is the leading provider of data and analytics to the agriculture and animal health and animal nutrition industries. This is made possible through tech-enabled unique data solutions, mission critical services to customers, and a long-standing trusted brand reputation with farmers, veterinarians, and pet owners.
The acquisition of Systematic International Limited expands Kynetec’s global machinery platform providing machinery volume statistics for world-wide closed and open data exchanges. The acquisition reinforces Kynetec’s continued commitment in developing data and analytics solutions as well as extending our reach in the machinery sector.
Review of the business
The result of the year and the financial position of Systematics International Limited (the “Company”) are as shown in the annexed financial statements.
SYSTEMATICS INTERNATIONAL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 2 -
Principal risks and uncertainties
The Directors acknowledge their overall responsibility for the Company’s system of internal control and for reviewing its effectiveness, and that there are ongoing procedures in place for identifying, evaluating and managing the financial risks of the Company.
The Company seeks to manage the risk of losing customers by improving the service provided while maintaining strong relationships with key customers. The Company seeks to manage the risk of reducing revenues from existing customers, due to budget constraints, by widening its customer base, selling more to key clients and selling more new products.
The main financial risks arising from the Company’s activities are customer information, cyber threat, price risk, credit risk, liquidity risk, and exchange rate risk. These are monitored by the directors and were not considered to be significant at the statement of financial position date.
Customer information
The Company collects and maintains increasing quantities and types of customer data in all segments of our business. Hardware and software applications include security features which are reviewed by our IT function to ensure compliance with our policies, security standards and UK GDPR requirements.
Cyber threat
The Company recognises the increasing threat of malicious data loss or outrages as a consequence of cyber-crime. This is mitigated by continuous monitoring of our IT infrastructure to identify threats and potential areas of weaknesses.
Price risk
The directors monitor price risk and consider that there are no significant associated risks.
Credit risk
The Company’s credit risk is primarily attributable to its trade debtors. Most of the Company’s customers are well known multinational organisations in the agricultural machinery manufacturers and dealers market space. The Company manages this risk by maintaining close relationships with its long-term customers. The directors make provisions for debts that are significantly past a customer’s extended credit terms, however all legal, valid trade debtors continue to be chased for settlement of the debt.
Liquidity risk
The Company actively monitors working capital and ensures that it has sufficient available funds for operations and to meet its debts as they fall due.
Exchange rate risk
The Company is exposed to exchange rate risk through sales denominated in foreign currency. There are no forward contracts or hedging in place.
SYSTEMATICS INTERNATIONAL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 3 -
Key performance indicators
Key Performance Indicators (“KPIs”), which are set at Board level, have been devised to allow the Board and shareholders to monitor the Group as a whole. The Directors consider revenue, gross profit and operating profit to be the KPIs for the Company.
The cash position of the Group and its development are monitored and reported to the Board on a monthly basis with regard to annual cash budgets and forecasts.
| Year ended 30 September 2024 | | Period ended 30 September 2023 |
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Other information and explanations
Equal opportunity employment
The Company is an equal opportunities employer and is unreservedly opposed to any form of direct or indirect discrimination being practiced against its employees or prospective employees because of their age, sex, parental status, colour, race, religion, nationality, creed, ethnic/national origin or disability status.
Employee involvement
The directors value an inclusive work environment where open communication and the contributions of all employees are valued. Diversity represents the differences that make everyone unique. Inclusion leverages those differences to promote our ability to deliver on the company’s objectives. There is a direct relationship between the business results of an organisation and its culture.
Future developments
Systematics International Limited is now part of Kynetec which creates differentiation in many advantageous ways, ensuring a loyal and consistent client base. The options for growth come from Kynetec’s continued commitment in developing data and analytics solutions and extending our global reach in the machinery sector.
Environmental matters
The company is committed to practices that generate safe workplace actions, conditions and procedures. The company also protects and conserves the natural environment and complies with all accepted environmental standards.
PS McDowell
Director
5 June 2025
SYSTEMATICS INTERNATIONAL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 4 -
The directors present their annual report and financial statements for the year ended 30 September 2024.
Results and dividends
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £1,538,771. The directors do not recommend payment of a final dividend.
No preference dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
MM Bhatt
PA Walker
(Resigned 13 December 2024)
PS McDowell
Auditor
The auditor, Rickard Luckin Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of disclosure to auditor
Each director in office at the date of approval of this annual report confirms that:
so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware, and
the director has taken all the steps that he / she ought to have taken as a director in order to make himself / herself aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.
Events after the reporting date
The directors have assessed all post-balance sheet events up to the date of approval of the financial statements and consider that, other than as disclosed in note 22, no events have occurred that would require adjustment or additional disclosure.
On behalf of the board
PS McDowell
Director
5 June 2025
SYSTEMATICS INTERNATIONAL LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 5 -
The directors are responsible for preparing the annual report and the 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies 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; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company 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 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
SYSTEMATICS INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SYSTEMATICS INTERNATIONAL LIMITED
- 6 -
Opinion
We have audited the financial statements of Systematics International Limited (the 'company') for the year ended 30 September 2024 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 Reduced Disclosure Framework (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 30 September 2024 and of its 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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the directors' report has been prepared in accordance with applicable legal requirements.
SYSTEMATICS INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SYSTEMATICS INTERNATIONAL LIMITED
- 7 -
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 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, 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 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, 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 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 company or to cease operations, or have no realistic alternative but to do so.
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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Capability of the audit in detecting irregularity, including fraud
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our: general commercial and sector experience; through verbal and written communications with those charged with governance and other management; and via inspection of the company’s regulatory and legal correspondence.
We discussed with those charged with governance and other management the policies and procedures regarding compliance with laws and regulations.
We communicated identified laws and regulations to our team and remained alert to any indicators of non-compliance throughout the audit, we also specifically considered where and how fraud may occur within the company.
The potential effect of these laws and regulations on the financial statements varies considerably.
Firstly, the company is subject to laws and regulations that directly affect the financial statements, including: the company’s constitution, relevant financial reporting standards; company law, distributable profits legislation and tax legislation and we assess the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
Secondly the company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on the amounts or disclosures in the financial statements, for instance through the imposition of fines and penalties, or through losses arising from litigations. We identified the following areas as those most likely to have such an affect: employment legislation; health and safety legislation; Data Protection legislation; anti-bribery and anti-corruption legislation.
SYSTEMATICS INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SYSTEMATICS INTERNATIONAL LIMITED
- 8 -
ISAs (UK) limit the required procedures to identify non-compliance with these laws and regulations, and no procedures over and above those already noted are required. These limited procedures did not identify any actual or suspected non-compliance with laws and regulations that could have a material impact on the financial statements.
In relation to fraud, we performed the following specific procedures in addition to those already noted:
Challenging assumptions made by management in its significant accounting estimates in particular: depreciation;
Identifying and testing journal entries, in particular any entries posted with unusual nominal ledger account combinations and journal entries crediting any revenue account;
Performing analytical procedures to identify unexpected movements in account balances which may be indicative of fraud;
Ensuring that testing undertaken on both the performance statement, and the Statement of Financial Position includes a number of items selected on a random basis;
These procedures did not identify any actual or suspected fraudulent irregularity that could have a material impact on the financial statements.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with ISAs (UK). For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the procedures that we are required to undertake would identify it. In addition, as with any audit, there remains a high risk of non-detection of irregularities, as these might involve collusion, forgery, intentional omissions, misrepresentation, or the override of internal controls. We are not responsible for preventing non-compliance with laws and regulations or fraud, and cannot be expected to detect non-compliance with all laws and regulations or every incidence of fraud.
A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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.
Neil Brewer (Senior Statutory Auditor)
For and on behalf of Rickard Luckin Limited
12 June 2025
Chartered Accountants
Statutory Auditor
1st Floor
19 Clifftown Road
Southend-On-Sea
Essex
SS1 1AB
SYSTEMATICS INTERNATIONAL LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 9 -
Year
Period
ended
ended
30 September
30 September
2024
2023
Notes
£
£
Revenue
4
1,087,444
653,898
Cost of sales
(37,311)
(36,735)
Gross profit
1,050,133
617,163
Administrative expenses
(359,230)
(328,563)
Operating profit
5
690,903
288,600
Investment income
8
776
7,969
Finance costs
9
(2,089)
(1,045)
Profit before taxation
689,590
295,524
Tax on profit
10
28,592
(68,359)
Profit and total comprehensive income for the financial year
718,182
227,165
SYSTEMATICS INTERNATIONAL LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2024
30 September 2024
- 10 -
2024
2023
Notes
£
£
£
£
Non-current assets
Property, plant and equipment
12
9,573
6,656
Right-of-use assets
12
5,519
20,290
15,092
26,946
Current assets
Trade and other receivables
13
975,728
1,949,846
Cash and cash equivalents
294,550
100,300
1,270,278
2,050,146
Current liabilities
14
(319,319)
(284,202)
Net current assets
950,959
1,765,944
Total assets less current liabilities
966,051
1,792,890
Non-current liabilities
14
(6,250)
Provisions for liabilities
Deferred tax liabilities
17
(1,191)
(1,191)
Net assets
964,860
1,785,449
Equity
Called up share capital
20
950
950
Retained earnings
963,910
1,784,515
Balance sheet suspense
-
(16)
Total equity
964,860
1,785,449
The financial statements were approved by the board of directors and authorised for issue on 5 June 2025 and are signed on its behalf by:
PS McDowell
Director
Company registration number 06182332 (England and Wales)
SYSTEMATICS INTERNATIONAL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 11 -
Share capital
Retained earnings
Total
£
£
£
Balance at 1 January 2023
950
1,618,850
1,619,800
Period ended 30 September 2023:
Profit and total comprehensive income for the period
-
227,165
227,165
Transactions with owners in their capacity as owners:
Dividends
11
-
(61,500)
(61,500)
IFRS 16 transitional adjustment
-
(16)
(16)
Balance at 30 September 2023
950
1,784,499
1,785,449
Year ended 30 September 2024:
Profit and total comprehensive income for the year
-
718,182
718,182
Transactions with owners in their capacity as owners:
Dividends
11
-
(1,538,771)
(1,538,771)
Balance at 30 September 2024
950
963,910
964,860
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 12 -
1
Accounting policies
Company information
Systematics International Limited is a private company limited by shares incorporated in England and Wales. The registered office is Kynetec, Weston Court, Weston, Newbury, Berkshire, RG20 8JE. The company's principal activities and nature of its operations are disclosed in the directors' report.
1.1
Accounting convention
The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
As permitted by FRS 101, the company has taken advantage of the following disclosure exemptions from the requirements of IFRS
inclusion of an explicit and unreserved statement of compliance with IFRS;
presentation of a statement of cash flows and related notes;
disclosure of the objectives, policies and processes for managing capital;
disclosure of key management personnel compensation;
disclosure of the categories of financial instrument and the nature and extent of risks arising on these financial instruments;
the effect of financial instruments on the statement of comprehensive income;
comparative period reconciliations for the number of shares outstanding and the carrying amounts of property, plant and equipment, intangible assets, investment property and biological assets;
disclosure of the future impact of new International Financial Reporting Standards in issue but not yet effective at the reporting date;
a reconciliation of the number and weighted average exercise prices of share options, how the fair value of share-based payments was determined and their effect on profit or loss and the financial position;
comparative narrative information;
for financial instruments, investment property and biological assets measured at fair value and within the scope of IFRS 13, the valuation techniques and inputs used to measure fair value, the effect of fair value measurements with significant unobservable inputs on the result for the period and the impact of credit risk on the fair value; and
related party disclosures for transactions with the parent or wholly owned members of the group.
Where required, equivalent disclosures are given in the group accounts of Kynetec UK Topco Limited. The group accounts of Kynetec UK Topco Limited are available to the public and can be obtained as set out in note 23.
1.2
Going concern
The directors have at the time of approving the financial statements, a reasonable expectation that the truecompany has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Revenue
Revenue is recognised at the fair value of the consideration chargeable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.
Revenue from contracts that entitle the client to a continual service over a period of time is deferred and recognised over the period of the contract.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 13 -
1.4
Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings: Right of use asset
Shorter of the useful economic life or the lease term.
Computer & office equipment
25% straight line
Motor vehicles: Right of use asset
Shorter of the useful economic life or the lease term.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the income statement.
1.5
Impairment of tangible and intangible assets
At each reporting end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
Financial assets
Financial assets are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.
At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 14 -
Financial assets held at amortised cost
Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.
Impairment of financial assets
Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.
The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
1.8
Financial liabilities
The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.
Other financial liabilities
Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or non-current assets.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
At inception, the company assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the company recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.
The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the company's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the company is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 16 -
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the company's estimate of the amount expected to be payable under a residual value guarantee; or the company's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Adoption of new and revised standards and changes in accounting policies
There are no amendments to accounting standards, or IFRIC update June 2023 interpretation that are effective for the year ended 30 September 2024 that have a material impact on the company's financial statements.
3
Critical accounting estimates and judgements
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.
Critical judgements
Weighted average borrowing rate
IFRS16 ‘Leases’ requires the company to initially measure the lease liability at the present value of the lease payments not paid at that date. The interest rate used to discount the future rent payments is based on finance rates for underlying assets of a similar nature and the Bank of England base rate.
Key sources of estimation uncertainty
Depreciation
Depreciation has been calculated using an estimate of the assets useful economic life. The useful economic life of assets is based on industry standards for assets of a similar nature adjusted for directors experience of the historic lifetime of similar assets within the business.
Bad debt provision
The company monitors it's debtors listing and provides for bad debts when they no longer expect to receive the money. If the customer later pays this money, the provision will be reversed. If it is confirmed that the customer will not be making the payment, the debt is written off.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 17 -
4
Revenue
An analysis of the company's revenue is as follows:
2024
2023
£
£
Revenue analysed by class of business
Rendering of services
1,087,444
653,898
5
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
958
878
Fees payable to the company's auditor for the audit of the company's financial statements
18,950
18,500
Depreciation of owned property, plant and equipment
3,765
4,095
Depreciation on property, plant and equipment held under finance leases
14,771
8,354
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
5
6
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
231,744
162,900
Social security costs
16,459
13,904
Pension costs
9,751
16,816
257,954
193,620
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
50,000
24,461
Amounts receivable under long term incentive schemes
2,738
3,378
Company pension contributions to defined contribution schemes
2,500
11,007
55,238
38,846
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
7
Directors' remuneration
(Continued)
- 18 -
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2023 - 2).
8
Investment income
2024
2023
£
£
Interest income
Interest on bank deposits
776
7,969
9
Finance costs
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on late paid tax
1,777
Other finance costs:
Unwinding of discount on provisions
312
1,045
Total finance costs
2,089
1,045
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
-
68,359
Adjustments in respect of prior periods
(28,592)
-
Total UK current tax
(28,592)
68,359
The tax rate for the current year is higher than the prior year, due to changes in the UK corporation tax rate, which increased from 19% to 25% from 1 April 2023. Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statements.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
10
Taxation
(Continued)
- 19 -
The charge for the year can be reconciled to the profit per the income statement as follows:
2024
2023
£
£
Profit before taxation
689,590
295,524
Expected tax charge based on a corporation tax rate of 25.00% (2023: 23.02%)
172,398
68,030
Effect of expenses not deductible in determining taxable profit
458
1,256
Group relief
(173,460)
Permanent capital allowances in excess of depreciation
(927)
Under/(over) provided in prior years
(28,592)
-
Change in unrecognised deferred tax assets
604
-
Taxation (credit)/charge for the year
(28,592)
68,359
11
Dividends
2024
2023
2024
2023
Amounts recognised as distributions:
per share
per share
Total
Total
£
£
£
£
Ordinary shares
Final dividend paid
1,619.76
64.74
1,538,771
61,500
12
Property, plant and equipment
Land and buildings: Right of use asset
Computer & office equipment
Motor vehicles: Right of use asset
Total
£
£
£
£
Cost
At 1 October 2023
28,644
29,617
2,286
60,547
Additions
6,682
6,682
Disposals
(2,286)
(2,286)
At 30 September 2024
28,644
36,299
64,943
Accumulated depreciation and impairment
At 1 October 2023
8,354
22,961
2,286
33,601
Charge for the year
14,771
3,765
18,536
Eliminated on disposal
(2,286)
(2,286)
At 30 September 2024
23,125
26,726
49,851
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
12
Property, plant and equipment
Land and buildings: Right of use asset
Computer & office equipment
Motor vehicles: Right of use asset
Total
£
£
£
£
(Continued)
- 20 -
Carrying amount
At 30 September 2024
5,519
9,573
15,092
At 30 September 2023
20,290
6,656
26,946
Property, plant and equipment includes right-of-use assets, as follows:
Right-of-use assets
2024
2023
£
£
Net values at the year end
Property
5,519
20,290
Depreciation charge for the year
Property
14,771
8,354
13
Trade and other receivables
2024
2023
£
£
Trade receivables
64,369
71,423
Amount owed by parent undertaking
833,235
1,838,771
Other receivables
-
1,759
Prepayments and accrued income
78,124
37,893
975,728
1,949,846
14
Liabilities
Current
Non-current
2024
2023
2024
2023
Notes
£
£
£
£
Trade and other payables
15
305,045
192,678
Corporation tax
2,355
68,359
-
-
Other taxation and social security
5,402
8,477
-
-
Lease liabilities
16
6,517
14,688
6,250
319,319
284,202
-
6,250
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 21 -
15
Trade and other payables
2024
2023
£
£
Trade payables
13,008
4,471
Amounts owed to fellow group undertakings
1,493
-
Accruals and deferred income
260,115
186,890
Other payables
30,429
1,317
305,045
192,678
16
Lease liabilities
2024
2023
Maturity analysis
£
£
Within one year
6,517
15,000
In two to five years
-
6,250
Total undiscounted liabilities
6,517
21,250
Future finance charges and other adjustments
-
(312)
Lease liabilities in the financial statements
6,517
20,938
Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:
2024
2023
£
£
Current liabilities
6,517
14,688
Non-current liabilities
6,250
6,517
20,938
2024
2023
Amounts recognised in profit or loss include the following:
£
£
Unwinding of discount on lease liability
312
1,045
17
Deferred taxation
Liabilities
2024
2023
£
£
Deferred tax balances
1,191
1,191
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
17
Deferred taxation
(Continued)
- 22 -
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon during the current and prior reporting period.
Accelerated capital allowances
£
Liability at 1 October 2022
1,191
Liability at 1 October 2023 and 30 September 2024
1,191
18
Deferred revenue
2024
2023
£
£
Arising from deferred income
241,059
146,355
Deferred income is recognised when the performance obligations of the sale include performance obligations provided after the year end.
19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
9,751
16,816
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
950
950
950
950
21
Related party transactions
Other information
At the year end the company was owed £833,235 (2023: £1,838,771) by its 100% owned parent organisation Kynetec UK Ltd. During the year the company made sales totalling £43,185 (2023: £nil) to Kynetec UK Ltd.
During the year the company purchased services totalling £673 (2023: £820) from Kynetec Bidco UK Limited, a group company, and owed the same company £1,493 (2023: £820) as at 30 September 2023.
SYSTEMATICS INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 23 -
22
Events after the reporting date
On the 28 November 2024, a dividend of £869.47 per share was declared, resulting in a total dividend of £826,000
23
Controlling party
By virtue of voting rights, the ultimate controlling party is Paine Schwartz Food Chain Fund V GP Ltd, A Cayman Islands exempted company.
The immediate parent of the company is Kynetec UK Limited, a company registered in England and Wales. The ultimate parent company and controlling entity of the company is Kynetec UK Topco Limited, a company registered in England and Wales. Kynetec UK Topco Limited is the smallest and largest group which prepares consolidated financial statements of which the company forms a part.
The consolidated financial statements of the ultimate parent company are available to the public and may be obtained from Corporate Administration, Kynetec, Weston Court, Weston, Newbury, Berkshire, RG20 8JE.
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