Information
Contents
Members' report
For the year ended 31 March 2025
The members present their report together with the audited financial statements of Horizon3 Investment Management LLP ('the LLP') for the year ended 31 March 2025.
Principal activity
The principal activity of the LLP is the provision of investment management and advisory services. Horizon3 Investment Management LLP is an investment management firm that has been regulated by the Financial Conduct Authority ('the FCA') in the UK since 28 April 2005 and is regulated as a commodity trading advisor by the Commodity Futures Trading Commission ('the CFTC') and the National Futures Association ('the NFA') in the United States of America.
Designated Members
The designated members of the LLP during the year were:
Paul Netherwood
Sanjeev Lakhanpal
Paul Netherwood
Sanjeev Lakhanpal
Business review and future developments
The CTA strategy continued to have a difficult year in performance in line the CTA sector as a whole. Global events, particularly in the US, have made it challenging for trend following strategies in terms of performance and asset raising. Asset levels dropped over the period which placed further emphasis on finding new strategies and investment partners. In future developments, the firm is developing a number of arbitrage strategies including one based on US Treasuries and Repos. These strategies are market neutral and expected to have wide investor appeal particularly with investors looking for wealth preservation.
Regulatory and Governance Disclosures
All regulatory, privacy and governance disclosures are available on https://h3im.com/disclosures/
Members' capital and interests
Each member's subscription to the capital of the LLP is determined by their capital contribution and is repayable following a crystallisation event in the LLP.
Details of members' capital at the year ended 31 March 2025 are set out in the Reconciliation of members' interests.
The Management Committee allocates profits to members in accordance with the Limited Liability Partnership Deed ('the Deed') dated 8 November 2018. In summary, members shall be eligible to take out such amounts of drawings that do not exceed the members' annual profit allocation for the relevant financial year. The drawings are made by way of regular monthly payment such that they do not cause the regulatory capital requirement of the LLP to be breached. The drawings are approved in advance at a minuted meeting of the Management Committee. Losses are allocated to members on a discretionary basis decided upon in the Management Comittee meetings.
Details of members' capital at the year ended 31 March 2025 are set out in the Reconciliation of members' interests.
The Management Committee allocates profits to members in accordance with the Limited Liability Partnership Deed ('the Deed') dated 8 November 2018. In summary, members shall be eligible to take out such amounts of drawings that do not exceed the members' annual profit allocation for the relevant financial year. The drawings are made by way of regular monthly payment such that they do not cause the regulatory capital requirement of the LLP to be breached. The drawings are approved in advance at a minuted meeting of the Management Committee. Losses are allocated to members on a discretionary basis decided upon in the Management Comittee meetings.
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Members' report (continued)
For the year ended 31 March 2025
Members' responsibilities statement
The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law, as applied to LLPs, requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102, ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law, as applied to LLPs, the members 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 LLP and of the profit or loss of the LLP for that period.
In preparing these financial statements, the members 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;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the LLP will continue in business.
The members are responsible for keeping adequate accounting records that are sufficient to show and explain the LLP's transactions and disclose with reasonable accuracy at any time the financial position of the LLP and to enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of the Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the LLP and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
This report was approved by the members on 24 July 2025 and signed on their behalf by:
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Independent auditor's report to the members of Horizon3 Investment Management LLP
For the year ended 31 March 2025
We have audited the financial statements of Horizon3 Investment Management LLP ('the LLP') for the year ended 31 March 2025, which comprise the Statement of comprehensive income, the Statement of financial position, the Reconciliation of members' interests, the Statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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 LLP in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In auditing the financial statements, we have concluded that the members' 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 LLP'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 members 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 members are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
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Independent auditor's report to the members of Horizon3 Investment Management LLP (continued)
For the year ended 31 March 2025
Other information (continued)
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.
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.
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.
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:
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Independent auditor's report to the members of Horizon3 Investment Management LLP (continued)
For the year ended 31 March 2025
Auditor's responsibilities for the audit of the financial statements (continued)
How the audit was considered capable of detecting irregularities including fraud
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud
and non-compliance with laws and regulations, was as follows:
How the audit was considered capable of detecting irregularities including fraud
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud
and non-compliance with laws and regulations, was as follows:
∙the Senior Statutory Auditor ensured that the engagement team collectively had the appropriate competence,
capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
∙we made enquiries of management as to where they considered there was susceptibility to fraud, and their
knowledge of actual, suspected and alleged fraud;
knowledge of actual, suspected and alleged fraud;
∙we identified the laws and regulations that could reasonably be expected to have a material effect on the financial
statements of the LLP through discussions with members and other management at the planning stage;
statements of the LLP through discussions with members and other management at the planning stage;
∙the audit team held a discussion to identify any particular areas that were considered to be susceptible to
misstatement, including with respect to fraud and non-compliance with laws and regulations; and
misstatement, including with respect to fraud and non-compliance with laws and regulations; and
∙we focused our planned audit work on specific laws and regulations which we considered may have a direct material
effect on the financial statements or the operations of the LLP including Companies Act 2006 as applied to LLPs, The
Financial Services and Markets Act 2000, employment legislation and taxation legislation.
effect on the financial statements or the operations of the LLP including Companies Act 2006 as applied to LLPs, The
Financial Services and Markets Act 2000, employment legislation and taxation legislation.
We assessed the extent of compliance with the laws and regulations identified above through:
∙making enquiries of management;
∙inspecting legal expenditure and correspondence throughout the year for any potential litigation or claims; and
∙considering the internal controls in place that are designed to mitigate risks of fraud and non-compliance with laws
and regulations.
and regulations.
To address the risk of fraud through management bias and override of controls, we:
∙determined the susceptibility of the LLP to management override of controls by checking the implementation of
controls and enquiring of individuals involved in the financial reporting process;
controls and enquiring of individuals involved in the financial reporting process;
∙reviewed journal entries throughout the year to identify unusual transactions;
∙performed analytical procedures to identify any large, unusual or unexpected transactions and investigated any large
variances from the prior period;
variances from the prior period;
∙reviewed accounting estimates and evaluated where judgements or decisions made by management indicated bias
on the part of the LLP's management;
on the part of the LLP's management;
∙tested the occurence of turnover by agreeing amounts in the nominal ledger to third party confirmation from the LLP's administrator and by reviewing the investment management agreements between the LLP and its managed funds; and
∙carried out substantive testing to check the occurrence and cut-off of expenditure.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which
included:
included:
∙agreeing financial statement disclosures to underlying supporting documentation; and
∙enquiring of management as to actual and potential litigation and claims.
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Independent auditor's report to the members of Horizon3 Investment Management LLP (continued)
For the year ended 31 March 2025
Auditor's responsibilities for the audit of the financial statements (continued)
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's report.
This report is made solely to the LLP's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, as applied by Part 12 of The Limited Liability Partnerships (Accounts and Audit) (Applications of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the LLP'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 LLP and the LLP's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Statutory auditor
130 Wood Street
EC2V 6DL
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Statement of comprehensive income
For the year ended 31 March 2025
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Statement of financial position
As at 31 March 2025
The financial statements were approved and authorised for issue by the members on 24 July 2025 and were signed on their behalf by:
The notes on pages 12 to 21 form part of these financial statements.
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Reconciliation of members' interests
For the year ended 31 March 2025
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Notes to the financial statements
For the year ended 31 March 2025
Reconciliation of members' interests (continued)
For the year ended 31 March 2025
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Statement of cash flows
For the year ended 31 March 2025
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Notes to the financial statements
For the year ended 31 March 2025
Horizon3 Investment Management LLP is a limited liability partnership incorporated in England and Wales with the registration number OC308135. The registered office and principal place of business is 48 Warwick Street, London, W1B 5AW.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' ('FRS 102'), the Companies Act 2006 and the requirements of the Statement of Recommended Practice "Accounting by Limited Liability Partnerships".
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the entity's accounting policies (see note 3).
The following principal accounting policies have been applied:
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the entity's accounting policies (see note 3).
The following principal accounting policies have been applied:
After reviewing the forecasts and projections the members have reasonable expectations that the LLP has adequate resources to continue in operational existence for the foreseeable future.
Post year end in April 2025, the firm signed an MOU to admit 3 new partners to the LLP who will acquire 45% of the LLP (subject to FCA approval). The three new partners bring sufficient financial resources to support the long-term growth of the firm as well as a new arbitrage strategy, and expertise in developing funds in Europe. In May 2025, £300,000 was injected as members' capital followed by a further £50,000 in July 2025.
Therefore, the members consider it appropriate to prepare the financial statements on a going concern basis.
Post year end in April 2025, the firm signed an MOU to admit 3 new partners to the LLP who will acquire 45% of the LLP (subject to FCA approval). The three new partners bring sufficient financial resources to support the long-term growth of the firm as well as a new arbitrage strategy, and expertise in developing funds in Europe. In May 2025, £300,000 was injected as members' capital followed by a further £50,000 in July 2025.
Therefore, the members consider it appropriate to prepare the financial statements on a going concern basis.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the LLP and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must
also be met before turnover is recognised:
Rendering of services
Turnover from a contract to provide services is recognised in the period in which the services are provided in
accordance with the stage of completion of the contract when all of the following conditions are satisfied:
• the amount of turnover can be measured reliably;
• it is probable that the LLP will receive the consideration due under the contract;
• the stage of completion of the contract at the end of the reporting period can be measured reliably,
and;
• the costs incurred and the costs to complete the contract can be measured reliably.
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Notes to the financial statements
For the year ended 31 March 2025
2.Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
The LLP adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the LLP. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
The LLP adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the LLP. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following bases:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
The LLP only enters into transactions that result in the recognition of basic financial instruments like trade and other debtors and creditors and loans to or from related parties.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of comprehensive income.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of comprehensive income.
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Notes to the financial statements
For the year ended 31 March 2025
2.Accounting policies (continued)
Functional and presentation currency
The LLP's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period-end, foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit or loss.
The LLP's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period-end, foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit or loss.
Defined contribution pension plan
The LLP operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the LLP pays fixed contributions into a separate entity. Once the contributions have been paid the LLP has no further payment obligations.
The contributions are recognised as an expense in the Statement of comprehensive income when they fall due. Amounts not paid are shown in other creditors as a liability in the Statement of financial position. The assets of the plan are held separately from the LLP in independently administered funds.
The LLP operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the LLP pays fixed contributions into a separate entity. Once the contributions have been paid the LLP has no further payment obligations.
The contributions are recognised as an expense in the Statement of comprehensive income when they fall due. Amounts not paid are shown in other creditors as a liability in the Statement of financial position. The assets of the plan are held separately from the LLP in independently administered funds.
Profits allocated to members arise from a division of profits that is discretionary on the part of the LLP. The
decision to divide the profits is made after the financial period. The LLP has the unconditional right to avoid
making payments to members, therefore division of profits is treated as an allocation of profit.
Losses made by the LLP are allocated to the members and are presented in a loss reserve which is included in 'other reserves'. The losses allocated to members are not recoverable by the LLP.
decision to divide the profits is made after the financial period. The LLP has the unconditional right to avoid
making payments to members, therefore division of profits is treated as an allocation of profit.
Losses made by the LLP are allocated to the members and are presented in a loss reserve which is included in 'other reserves'. The losses allocated to members are not recoverable by the LLP.
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Notes to the financial statements
For the year ended 31 March 2025
2.Accounting policies (continued)
Other operating income is made up of amounts received as compensation from class action settlements with banking entites. The compensation comes from legal firms who handle the settlements on the LLPs behalf. The income is recognised on receipt of each claim as that is when it becomes probable that the economic benefits will flow to the LLP.
that affect the amount reported for assets and liabilities as at the reporting date and the amounts reported for revenues and expenses during the year.
In preparing these financial statements, the main judgement and area of estimation uncertainty relate to:
Recoverability of the amounts due from members balance
Amounts due from members' totalling £51,018 is subject to estimation uncertainty over timing of receipt. The members have performed their assessment based on information available to them at the reporting date. The members have used their extensive knowledge and experience to determine the recoverability of this balance, and therefore the balance has been recognised as its recoverable amount.
The whole of the turnover is attributable to the principal activity of the LLP.
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Notes to the financial statements
For the year ended 31 March 2025
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Notes to the financial statements
For the year ended 31 March 2025
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Notes to the financial statements
For the year ended 31 March 2025
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Notes to the financial statements
For the year ended 31 March 2025
Page 19
Notes to the financial statements
For the year ended 31 March 2025
The LLP had no contingent liabilities at 31 March 2025 or 31 March 2024.
The LLP had no capital commitments at 31 March 2025 or 31 March 2024.
The LLP operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the entity in an independently administered fund. The pension cost charge represents contributions payable by the entity to the fund and amounted to £6,604 (2024 - £6,604). Contributions totalling £1,284 (2024 - £1,284) were payable to the fund at the reporting date and are included in 'other creditors'.
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Notes to the financial statements
For the year ended 31 March 2025
In the opinion of the designated members, there is no ultimate controlling party.
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