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Registration number: 10455960

Bud Systems Limited

Annual Report and Financial Statements

for the Year Ended 31 December 2024

 

Bud Systems Limited

Contents

Company Information

1

Strategic Report

2

Directors' Report

3

Statement of Directors' Responsibilities

4

Independent Auditor's Report

5 to 7

Profit and Loss Account

8

Balance Sheet

9

Statement of Changes in Equity

10

Statement of Cash Flows

11 to 12

Notes to the Financial Statements

13 to 23

 

Bud Systems Limited

Company Information

Directors

Ms H Frankham

Mr J P Ingram

Mr M H Whitby

Mr L Matthews

Registered office

40 Berkeley Square
Bristol
BS8 1HP

Auditors

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

Bud Systems Limited

Strategic Report for the Year Ended 31 December 2024

The directors present their strategic report for the year ended 31 December 2024.

Principal activity

The principal activity of the company is developing, hosting and distributing an online training and management platform.

Fair review of the business

Bud Systems Limited provides a market leading technology platform in the further education sector. Our principal activity is the development and support of a Software as a Service (SaaS) product used by employers, training organisations and learners as a key element of their digital transformation.

Growth and retention
This financial year has seen continued rapid growth. Revenue grew by 14% year-on-year. The business generates the majority of its income through recurring subscription revenues with client retention remaining high during the period.

Investment
We made significant investments across both technology and our team in the year:

• The further development of our platform, to ensure we can continue to capitalise on the transformative opportunity in our market and grow market share.
• Ensuring that we have a team who are capable of driving all aspects of business growth, product development and customer care.

The Directors consider this investment to be successful, with a decrease in loss by 23% year-on-year and planned profitability for the business within reach.

Opportunity and future developments
The results for the periods and financial position of the company are as shown in the financial statements. Turnover of £4,729,405 (2023: £4,131,823) is considered a strong performance within an competitive industry facing political and economic challenges.

The loss for the period of £1,016,399 (2023: £1,313,609) reflects the investment by the business to further develop the product and grow market share.

The business will continue to focus on client acquisition and revenue growth in the next period, with continuing positive momentum expected in line with the strategy developed and agreed with the Board. This includes planned delivery of a net profit for the business.

Principal risks and uncertainties

The directors consider the key risks and uncertainties facing the company are those arising from the generally held perception of difficulties with the UK economy; government policy regarding education, training, and employment; and the increasing sophistication of cybercrime and threat to information security from both criminal activity and geopolitical conflict.

Research and development

Software development costs have been capitalised in the year.

Financial key performance indicators
The directors use EBITDA and Annualised Recurring Revenue as key measures for the company with EBITDA of £217,605 (2023: Loss of £394,887) and ARR of £5.0m as at December 2024 (December 2023: £3.8m) that reflect the performance and position of the business.

Approved by the Board on 20 May 2025 and signed on its behalf by:


Mr J P Ingram
Director

 

Bud Systems Limited

Directors' Report for the Year Ended 31 December 2024

The directors present their report and the financial statements for the year ended 31 December 2024.

Directors of the company

The directors who held office during the year were as follows:

Ms H Frankham

Mr J P Ingram

Mr M H Whitby

Mr L Matthews

Financial instruments

The Company’s principal financial instruments comprise bank balances, a bank overdraft facility, trade creditors, trade debtors and third-party loans which provide finance for the Company’s operations. The main risk for the Company is credit risk and liquidity risk.

The Company’s finances are monitored by the directors on a continuous basis that include medium and long-term financial plans and cashflows. The directors will seek to employ the most affordable and suitable finance to mitigate any liquidity risk.

The Company’s Debtors are monitored regularly by the Directors through regular communication with customers; by utilising credit assessment services; and staying current on disclosures by funding and governing bodies.

Going Concern

During the year, further equity was introduced into the Company by the existing shareholders to support the development of the product. Recent and forecast performance demonstrates the Company can deliver its plan without the need for further investment. Any short term working capital requirements can be satisfied by the Company’s approved overdraft facility. The existing shareholders are committed to ensuring the longer-term financial stability of the Company.

On this basis, the directors conclude that it is appropriate to continue to use the going concern basis of preparation.

Information included in the Strategic Report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Sch. 7 to the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (SI 2008/410) to be contained in the directors' report. It has done so in respect of future developments and research and development.

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Approved by the Board on 20 May 2025 and signed on its behalf by:


Mr J P Ingram
Director

 

Bud Systems Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities 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 apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable United Kingdom 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.

 

Bud Systems Limited

Independent Auditor's Report to the Members of Bud Systems Limited

Opinion

We have audited the financial statements of Bud Systems Limited (the 'company') for the year ended 31 December 2024, which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, 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 company's affairs as at 31 December 2024 and of its loss for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor 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 original financial statements were 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.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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 matter prescribed by the Companies Act 2006

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

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

 

Bud Systems Limited

Independent Auditor's Report to the Members of Bud Systems Limited

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report and Directors' Report.

We have nothing to report in respect of the following matters where 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 Statement of Directors' Responsibilities set out on page 4, 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 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.

Extent to which the audit was capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We considered the nature of the company's industry and its control environment and reviewed the company's documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities.

We obtained an understanding of the legal and regulatory framework that the company operates in and identified the key laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements, including the UK Companies Act and tax legislation, and, those that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid material penalty.

We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.

In common with all audits conducted in accordance with ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override of controls. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgements made in accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.

In addition to the above, our procedures to respond to the risks identified included the following:

 

Bud Systems Limited

Independent Auditor's Report to the Members of Bud Systems Limited

• reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatements due to fraud;

• enquiring of management concerning actual and potential litigation and claims and instances of non-compliance with laws and regulations; and

• reading minutes of meetings of those charged with governance.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud my involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of this 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.





Felicity Sang (Senior Statutory Auditor)
For and on behalf of Hazlewoods LLP, Statutory Auditor

Staverton Court
Staverton
Cheltenham
GL51 0UX

19 June 2025

 

Bud Systems Limited

Profit and Loss Account for the Year Ended 31 December 2024

Note

2024
£

2023
£

Turnover

3

4,729,405

4,131,823

Cost of sales

 

(508,965)

(295,098)

Gross profit

 

4,220,440

3,836,725

Distribution costs

 

-

(41)

Administrative expenses

 

(5,451,011)

(5,580,424)

Operating loss

4

(1,230,571)

(1,743,740)

Interest receivable and similar income

2,753

6,978

Interest payable and similar expenses

8

(7,581)

(2,717)

Loss before tax

 

(1,235,399)

(1,739,479)

Tax on loss

9

(10,449)

425,870

Loss for the financial year

 

(1,245,848)

(1,313,609)

The above results were derived from continuing operations.

The company has no other comprehensive income for the year.

 

Bud Systems Limited

(Registration number: 10455960)
Balance Sheet as at 31 December 2024

Note

2024
£

2023
£

Fixed assets

 

Intangible assets

10

3,929,247

3,778,890

Tangible assets

11

17,887

26,407

 

3,947,134

3,805,297

Current assets

 

Debtors

12

933,404

1,179,971

Cash at bank and in hand

 

186,942

319,920

 

1,120,346

1,499,891

Creditors: Amounts falling due within one year

13

(859,062)

(863,309)

Net current assets

 

261,284

636,582

Total assets less current liabilities

 

4,208,418

4,441,879

Creditors: Amounts falling due after more than one year

13

(25,752)

(31,583)

Net assets

 

4,182,666

4,410,296

Capital and reserves

 

Called up share capital

16

19

18

Share premium reserve

19

17,014,688

16,435,689

Other reserves

19

778,724

339,506

Retained earnings

19

(13,610,765)

(12,364,917)

Shareholders' funds

 

4,182,666

4,410,296

Approved and authorised by the Board on 20 May 2025 and signed on its behalf by:
 


Mr J P Ingram
Director

 

Bud Systems Limited

Statement of Changes in Equity for the Year Ended 31 December 2024

Share capital
£

Share premium
£

Other reserves
£

Profit and loss account
£

Total
£

At 1 January 2024

18

16,435,689

339,506

(12,364,917)

4,410,296

Loss for the year

-

-

-

(1,245,848)

(1,245,848)

Other comprehensive income

-

-

439,218

-

439,218

Total comprehensive income

-

-

439,218

(1,245,848)

(806,630)

New share capital subscribed

1

578,999

-

-

579,000

At 31 December 2024

19

17,014,688

778,724

(13,610,765)

4,182,666

Share capital
£

Share premium
£

Other reserves
£

Profit and loss account
£

Total
£

At 1 January 2023

18

16,435,689

63,041

(11,051,308)

5,447,440

Loss for the year

-

-

-

(1,313,609)

(1,313,609)

Other comprehensive income

-

-

276,465

-

276,465

Total comprehensive income

-

-

276,465

(1,313,609)

(1,037,144)

At 31 December 2023

18

16,435,689

339,506

(12,364,917)

4,410,296

 

Bud Systems Limited

Statement of Cash Flows for the Year Ended 31 December 2024

Note

2024
£

2023
£

Cash flows from operating activities

Loss for the year

 

(1,245,848)

(1,313,609)

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

4

1,448,176

1,348,855

Finance income

(2,753)

(6,978)

Finance costs

8

7,581

2,717

Share based payment transactions

 

439,218

276,465

Income tax credit

9

10,449

(425,870)

 

656,823

(118,420)

Working capital adjustments

 

Increase in trade debtors

12

(179,303)

(32,075)

(Decrease)/increase in trade creditors

13

(4,247)

23,196

Cash generated from operations

 

473,273

(127,299)

Income taxes received

9

415,421

861,103

Net cash flow from operating activities

 

888,694

733,804

Cash flows from investing activities

 

Interest received

2,753

6,978

Acquisitions of tangible assets

11

(13,685)

(8,916)

Acquisition of intangible assets

10

(1,576,328)

(1,872,397)

Net cash flows from investing activities

 

(1,587,260)

(1,874,335)

Cash flows from financing activities

 

Interest paid

8

(7,581)

(2,717)

Proceeds from issue of ordinary shares, net of issue costs

 

579,000

-

Repayment of bank borrowing

 

(5,831)

(5,830)

Net cash flows from financing activities

 

565,588

(8,547)

Net decrease in cash and cash equivalents

 

(132,978)

(1,149,078)

Cash and cash equivalents at 1 January

 

319,920

1,468,998

Cash and cash equivalents at 31 December

 

186,942

319,920

 

Bud Systems Limited

Statement of Cash Flows for the Year Ended 31 December 2024

 

Analysis of changes in net debt

At 1 January 2024
£

Financing cash flows
£

At 31 December 2024
£

Cash and cash equivalents

Cash

319,920

(132,978)

186,942

Borrowings

Long term borrowings

(31,583)

5,831

(25,752)

Short term borrowings

(5,830)

-

(5,830)

(37,413)

5,831

(31,582)

 

282,507

(127,147)

155,360

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
40 Berkeley Square
Bristol
BS8 1HP

 

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Going concern

During the year, further equity was introduced into the Company by the existing shareholders to support the development of the product. Recent and forecast performance demonstrates the Company can deliver its plan without the need for further investment. Any short term working capital requirements can be satisfied by the Company’s approved overdraft facility. The existing shareholders are committed to ensuring the longer-term financial stability of the Company.
On this basis, the directors conclude that it is appropriate to continue to use the going concern basis of preparation.

Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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.
 

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

Judgements

The directors have concluded the judgement over the classification of the shares versus liability is a significant judgement within the financial statements. The disclosure within the share capital disclosure describes the conclusion around this judgement in more detail.

Going concern is a key judgement. The disclosure within accounting policies describes the processes undertaken around this judgement in more detail.

The company undertakes both research and development. Management have reviewed the costs incurred and consider that a significant proportion of these costs meet the definition of development costs. Consequently, these costs have been capitalised.

Key sources of estimation uncertainty

The key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are described below:

Software development costs are carried at cost less accumulated amortisation and impairment, which requires estimation as to the useful economic life of the software development costs. Amortisation for software developments are estimated based on expected life cycle of renewing the software. Changes to these assumptions and estimates in future periods reflecting the information available at that point in time may result in outcomes that are materially different. Software development cost are assessed annually for indication of impairment. The carrying amount is £3,929,247 (2023 - £3,778,890).

The company has put in place an EMI share option scheme. The options in existence at 31 December 2024 have been fair valued using the Black-Scholes option pricing model. There are a number of judgement and estimates made by management within this model. Further details are disclosed in Note 17.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.

The company recognises subscription based revenues on actual subscription levels in the relevant period at the contracted rate for each customer.

The company recognises revenue for any other consultancy as each economic benefit of the work in part or in full are delivered to the customer.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

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

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

Intangible assets

Intangible assets are stated in the balance sheet at cost, less any any subsequent accumulated amortisation.

Development of products is capitalised where there is expected to be a benefit to future periods and the following conditions are met:
(i) It is technically feasible to complete the research or development so that the product will be available for use or sale.
(ii) It is intended to use or sell the product being developed.
(iii) The company is able to use or sell the product.
(iv) It can be demonstrated that the product will generate probable future economic benefits.
(v) Adequate technical, financial and other resources exist so that product development can be completed and subsequently used or sold.
(vi) Expenditure attributable to the research and development work can be reliably measured.

Capitalised development expenditure is stated at cost less accumulated amortisation and impairment losses and amortised over its useful economic life. Assessment of its useful economic life is 5 years.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Software development costs

20% straight line

Other intangible asset

33% straight line

Amortisation charged to the profit and loss is recognised within administrative expenses.

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Office equipment

25% straight line

Computer equipment

33% straight line

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits.

Trade debtors

Trade debtors are amounts due from customers for services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

Financial instruments


Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

3

Turnover

The analysis of the company's revenue for the year from continuing operations is as follows:

2024
£

2023
£

Online Training Management Platform Services provided

4,729,405

4,131,823

The analysis of the company's Turnover for the year by market is as follows:

2024
£

2023
£

United Kingdom

4,729,405

4,131,823

 

4

Operating profit

Arrived at after charging/(crediting)

2024
£

2023
£

Depreciation expense

22,205

30,795

Amortisation expense

1,425,971

1,318,060

Foreign exchange losses

-

41

 

5

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2024
£

2023
£

Wages and salaries

3,733,048

2,375,253

Social security costs

355,447

362,541

Pension costs, defined contribution scheme

136,887

136,140

Redundancy costs

51,897

58,783

4,277,279

2,932,717

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2024
No.

2023
No.

Management and support

20

16

Development

26

27

Marketing, sales and client engagement

13

17

59

60

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

6

Directors' remuneration

The directors' remuneration for the year was as follows:

2024
£

2023
£

Remuneration

219,372

192,132

Contributions paid to money purchase schemes

61,278

48,448

280,650

240,580

During the year the number of directors who were receiving benefits and share incentives was as follows:

2024
No.

2023
No.

Accruing benefits under money purchase pension scheme

1

3

In respect of the highest paid director:

2024
£

2023
£

Remuneration

156,413

177,314

Company contributions to money purchase pension schemes

61,278

48,345

 

7

Auditors' remuneration

2024
£

2023
£

Audit of the financial statements

16,000

16,000

Other fees to auditors

Taxation compliance services

3,000

12,000

All other assurance services

3,500

3,000

6,500

15,000


 

 

8

Interest payable and similar expenses

2024
£

2023
£

Interest on bank overdrafts and borrowings

7,581

2,717

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

9

Taxation

Tax credited in the profit and loss account

2024
£

2023
£

Current taxation

UK corporation tax

-

(425,870)

UK corporation tax adjustment to prior periods

10,449

-

10,449

(425,870)

The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2023 - lower than the standard rate of corporation tax in the UK) of 25% (2023 - 19%).

The differences are reconciled below:

2024
£

2023
£

Loss before tax

(1,235,399)

(1,739,479)

Corporation tax at standard rate

(308,850)

(409,136)

Increase in UK and foreign current tax from adjustment for prior periods

10,449

-

Effect of expense not deductible in determining taxable profit (tax loss)

9,356

539

(Decrease)/increase from tax losses for which no deferred tax asset was recognised

304,744

(16,371)

R&D tax credit

-

(425,870)

Tax decrease from effect of adjustment in research and development tax credit

-

(465,506)

Other tax effects for reconciliation between accounting profit and tax expense (income)

(5,250)

892

Surrender of losses for R&D tax credit

-

889,582

Total tax charge/(credit)

10,449

(425,870)

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

10

Intangible assets

Software development costs
£

Other intangible assets
 £

Total
£

Cost or valuation

At 1 January 2024

9,207,602

633,676

9,841,278

Additions acquired separately

1,576,328

-

1,576,328

At 31 December 2024

10,783,930

633,676

11,417,606

Amortisation

At 1 January 2024

5,428,712

633,676

6,062,388

Amortisation charge

1,425,971

-

1,425,971

At 31 December 2024

6,854,683

633,676

7,488,359

Carrying amount

At 31 December 2024

3,929,247

-

3,929,247

At 31 December 2023

3,778,890

-

3,778,890

 

11

Tangible assets

Furniture, fittings and equipment
 £

Other tangible assets
£

Total
£

Cost or valuation

At 1 January 2024

13,685

105,283

118,968

Additions

560

13,125

13,685

Disposals

(9,329)

(20,264)

(29,593)

At 31 December 2024

4,916

98,144

103,060

Depreciation

At 1 January 2024

13,685

78,876

92,561

Charge for the year

31

22,174

22,205

Eliminated on disposal

(9,329)

(20,264)

(29,593)

At 31 December 2024

4,387

80,786

85,173

Carrying amount

At 31 December 2024

529

17,358

17,887

At 31 December 2023

-

26,407

26,407

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

12

Debtors

Note

2024
£

2023
£

Trade debtors

 

830,620

677,030

Other debtors

 

3,000

4,717

Prepayments

 

99,784

72,354

Corporation tax asset

9

-

425,870

 

933,404

1,179,971

 

13

Creditors

Note

2024
£

2023
£

Due within one year

 

Loans and borrowings

14

5,830

5,830

Trade creditors

 

316,928

292,409

Social security and other taxes

 

350,540

449,763

Other payables

 

69,644

37,456

Accruals

 

116,120

77,851

 

859,062

863,309

Due after one year

 

Loans and borrowings

14

25,752

31,583

 

14

Loans and borrowings

Current loans and borrowings

2024
£

2023
£

Bank borrowings

5,830

5,830

Non-current loans and borrowings

2024
£

2023
£

Bank borrowings

25,752

31,583

The £31,583 bank borrowings represent an unsecured CBILs loan from the company's bankers. The interest rate on the loan is 2.50% per annum, fixed for the duration of the loan.

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

15

Share-based payments

Option scheme

Scheme details and movements

Bud Systems Limited operates a share option scheme in which certain employees of Bud Systems Limited can participate.

The scheme is equity settled. The fair value of the options has been calculated using the Black Scholes model, it was considered that this approach would result in a materially accurate estimate of the fair value of the options granted. The key assumptions used to value the share options under the Black-Scholes model are as follows:
• Expected volatility 46.08%
• Risk-free interest rate 4.1%

The movements in the number of share options during the year were as follows:

2024
Number

2023
Number

Outstanding, start of period

454,472

106,000

Granted during the period

98,628

418,254

Forfeited during the period

(10,000)

(69,782)

Outstanding, end of period

543,100

454,472

The movements in the weighted average exercise price of share options during the year were as follows:

2024
£

2023
£

Outstanding, end of period

1.43

0.75

The total share option charge for the year was £439,218 (2023: £276,465). The charge has been credited to the share option reserve.

 

16

Share capital

Allotted, called up and fully paid shares

2024

2023

No.

£

No.

£

A Ordinary of £0.000005 each

1,598,022

7.99

1,472,499

7.36

B Ordinary of £0.000005 each

60,980

0.30

60,980

0.30

C Ordinary of £0.000005 each

262,624

1.31

262,624

1.31

D Ordinary of £0.000005 each

1,786,019

8.93

1,786,019

8.93

3,707,645

18.54

3,582,122

17.91

All shares have full voting and dividend rights. The A,B,C and D Shares have preferential rights on an exit. In all other aspects all shares rank pari pasu.

In the event of winding up, capital distribution will be made first to A Ordinary shareholders, followed by B Ordinary shareholders, followed by C Ordinary shareholders and depending on availability of distributable reserves this will followed by D Ordinary shareholders.

During the year, 125,523 A Ordinary shares were issued at a nominal value of £0.000005.

 

Bud Systems Limited

Notes to the Financial Statements for the Year Ended 31 December 2024

 

17

Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £136,887 (2023 - £136,140).

Contributions including employee salary sacrifice totalling £30,880 (2023 - £28,623) were payable to the scheme at the end of the year and are included in creditors.

 

18

Related party transactions

During the year the company made purchases from an entity connected by virtue of common control of £102,831 (2023 - £157,121) and sales of £nil (2023 - £1,837). At 31 December 2024 the balance owed was £nil (2023 - £7,396). No interest was paid on this balance.

During the year the company made purchases from an entity connected by virtue of common control of £83,846 (2023 - £76,314). At 31 December 2024 the balance owed was £43,058 (2023 - £32,296). No interest was paid on this balance.

Additionally, during the year the company was advanced a loan of £200,000 from an entity connected by virtue of common control. At the year end, the loan had been repaid in full, together with interest of £6,504.

 

19

Reserves

The company's capital and reserves are as follows:

Called up share capital
Called up share capital represents the nominal value of the shares issues.

Share premium
The share premium accounts include the premium issue of equity shares, net of any issue costs.

Other reserves
Other reserves represents share based payment reserves. A share based payments reserve arises to account for the credit entry for share based payments arrangements charged to the profit and loss.

Profit and loss account
The profit and loss account represents cumulative profits and losses, net of dividends paid and other adjustments.

 

20

Ultimate controlling party

The ultimate controlling party is H Frankham by virtue of majority shareholding of the company.