For the financial period ended 31 December 2024 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The member has not required the company to obtain an audit of its financial statements for the period in question in accordance with section 476.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

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

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

Kraken Technology Group Limited is a private company limited by shares incorporated in England and Wales. The registered office is Zeeta House, 200 Upper Richmond Road, Putney, London, United Kingdom, SW15 2SH.

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.

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future and in the current period the convertible loan is converted as referenced in the subsequent event note. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

Cash and cash equivalents are basic financial assets and 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.

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 and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. 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, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. 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. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

The component parts of compound instruments issued by the company are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangement. At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument. This amount is recorded as a liability on an amortised cost basis using the effective interest method until extinguished upon conversion or at the instrument's maturity date. The equity component is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognised and included in equity net of income tax effects and is not subsequently remeasured.

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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

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

The Company has issued Simple Agreement for Future Equity (“SAFE”) which provides investors with the right to receive equity in a future qualifying financing event or other specified conversion events. The SAFE does not entitle the investor to a fixed number of equity instruments and contains potential settlement outcomes that include variable equity conversion. Accordingly, the SAFE does not meet the definition of an equity instrument under FRS 102 and is classified as a financial liability.

On initial recognition, the SAFE is measured at fair value, which is normally the consideration received. As the conversion terms are variable and linked to future financing valuations, the SAFE is classified as a non-basic financial instrument. Subsequent to initial recognition, the SAFE is measured at fair value through profit or loss, with changes in fair value recognised in the Statement of Comprehensive Income.

The SAFE is presented as a non-current liability, as the Company does not expect the instrument to be settled within 12 months of the reporting date.

On conversion of the SAFE into equity instruments, the financial liability is derecognised and the corresponding amount is credited to equity. No gain or loss is recognised on conversion.

On 3 May 2024 the company allotted 519193 series A ordinary shares, the aggregate nominal value of these shares was £519.193 and the consideration was by way of conversion of convertible loan notes in the sum of £6,999,922.

On 30 October 2024 there was a further allotment of shares being 31231 series A ordinary shares, the aggregate nominal value of these shares was £31.231 and the consideration was also by way of convertible loan notes in the sum of £1,000,0016.62.

On 22nd June 2022 the company had awarded share options to certain employees and others over the Ordinary shares in the company with further options issued in September 2024.

At the balance sheet date 118,841 share options had been awarded and 52,270 remained unallocated from a total pool of 171,111. Some of those awarded are under an approved Enterprise Management Incentive "EMI" scheme and others are non-qualifying options. These share options can only be exercised upon an agreed Exit event as per the scheme rules. These options vest equally over 4 full years of employment or satisfaction of contractual agreements where the options are non qualifying.

Given the group is currently loss making and the growth in the company was not certain at the date the options were granted, it is inherently difficult to assess the fair value of these option awards.

The directors have assessed that the quantum of any such adjustment is not likely to be material to these financial statements, as a consequence no adjustment has been made.

Consolidated financial statements have not been prepared as the company is taking advantage of the small companies exemption for group entities.