The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

Reading Room Digital Limited is a private company limited by shares incorporated in England and Wales. The registered office is Harling House, 47-51 Great Suffolk Street, London, SE1 0BS.

The company changed its name from Fat Media Limited to Reading Room Digital Limited on 24 July 2024.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

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.

Although the company reported a loss for the year, trading in the 8 months following the year-end up to the date of approving the accounts has been positive. During this period, the company has been profitable, with growing revenues and improved gross margins. Based on a review of the cash flow forecasts for the next 12 months, the directors expect the company to continue being profitable. true

The financial statements have been prepared on a going concern basis, which the directors consider appropriate for the following reasons:

The company shares cash resources with fellow group companies throughout the year to meet cash requirements. Based on the review of the group cash flow forecasts, the directors expect the company to have access to sufficient access to cash over the next 12 months.

Despite the breach of covenants in December 2024 for the bank loan, discussions with the bank have led the directors to believe that this will not result in the withdrawal of the loan facility. The company maintains a good relationship with the lending bank, which understands the long-term investments being undertaken to create further value within the Group. In the first relevant period after the year-end, the requirements of the bank covenants have been met.

There is a loan owed to a director and the ultimate controlling shareholder. The directors have received a letter from the director indicating their intention not to demand repayment of the loan for the foreseeable future or until the company has sufficient liquidity to make repayments without impacting its operations.

Based on the above, at the time of approving the financial statements, the directors have a reasonable expectation that the Company have 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.

Turnover represents amounts receivable for services net of VAT to the extent that the business has the right to consideration arising from the performance of its contractual arrangements. Turnover is recognised based on the date the service is provided. Any income invoiced in advance is deferred until the service is provided, with income recognised based on the percentage completeness of any ongoing projects.

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:

Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:

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 credited or charged to profit or loss.

At each reporting period 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.

Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs. Financial assets classified as receivable within one year are not amortised.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors, are initially recognised at transaction price. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. Trade creditors are recognised initially at transaction price.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account 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.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing 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 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 fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

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.

The average monthly number of persons (including directors) employed by the company during the year was:

The amounts owed by group undertakings are classified as current assets as they are repayable on demand. Whilst these balances are classified as current assets, the directors do not expect them to be received within 12 months of the balance sheet date.

Bank loans totalling £200,000 (2023: £200,000) are secured by way of a cross company guarantee and debenture as detailed in note 9. Other creditors totalling £Nil (2023: £371,081) have been secured by a debenture containing a fixed and floating charge over all current and future assets of the company. Hire purchase balances totalling £15,822 (2023: £15,822) are secured against the assets to which they relate.

Bank loans totalling £300,000 (2023: £500,000) are secured by way of a cross company guarantee and debenture as detailed in note 9. Other creditors totalling £2,026,081 (2023: £1,000,000) have been secured by a debenture containing a fixed and floating charge over all current and future assets of the company. Hire purchase balances totalling £8,577 (2023: £26,619) are secured against the assets to which they relate.

At the year end the group owed a director £2,026,081 (2023: £1,371,081). The loan is repayable on demand and interest free. There is a letter of postponement in place which prescribes that £600,000 of the loan balance must not be repaid until the bank loans have been settled. Additionally, the directors are in receipt of a letter confirming that repayment of the balance will not be demanded until at least 1 January 2026. On this basis the loan is presented within creditors falling due after more than one year.

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

A cross-company guarantee and debenture is in place in favour of Barclays Bank UK plc between the company, Ronin International Limited and Rippleffect Group Limited.

At the balance sheet date, group borrowings totalled £500,000 (2023: £700,000) and are included in the financial statements of the company.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

At the year end, a balance of £2,026,081 (2023: £1,371,081) was owed to a director and ultimate controlling shareholder. The loan is repayable on demand and interest free. The loan is secured by a debenture containing a fixed and floating charge over all current and future assets of the company.

The company has taken advantage of the exemption permitted under Section 1AC.35, namely from disclosing any transactions entered into between two or more members of the group, provided that any subsidiary which is a party to the transaction is a wholly owned group member.

The company is a wholly owned subsidiary of Reading Room International Limited, a company incorporated in England and Wales.

The ultimate parent company is Rippleffect Group Limited, a company incorporated in England and Wales. The registered office of Rippleffect Group Limited is Harling House, 47-51 Great Suffolk Street, London, SE1 0BS.

The largest and smallest group in which the results of the company are consolidated is that headed by Rippleffect Group Limited. Copies of the accounts can be obtained from Companies House, Crown Way, Cardiff CF14 3UZ.