THE REAL ECONOMY EFFECT LTD


Director	GALANTINE HELLER, Stephanie Marie


Registered Address	68 Great Eastern Street
	London
	EC2A 3JT


Registered Number	13147519 (England and Wales)

Notes to the Financial Statements
for the year ended 31 December 2025

1.	Accounting policies

	Statutory information
	The company is a private company limited by shares and registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

	Statement of compliance
	The financial statements have been prepared in accordance with the Companies Act 2006 and FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland including Section 1A Small Entities. These financial statements are the company's first financial statements prepared in accordance with FRS 102 Section 1A. In the previous period, the company prepared its financial statements in accordance with FRS 105 The Financial Reporting Standard applicable to the micro-entities regime. On transition to FRS 102, the company recognised deferred taxation in respect of timing differences arising between the carrying value of fixed assets and the related tax written down values. Deferred taxation was not recognised under FRS 105.

Statement of compliance

The financial statements have been prepared in accordance with the Companies Act 2006 and FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland including Section 1A Small Entities.

These financial statements are the company's first financial statements prepared in accordance with FRS 102 Section 1A.  In the previous period, the company prepared its financial statements in accordance with FRS 105 The Financial Reporting Standard applicable to the micro-entities regime.

On transition to FRS 102, the company recognised deferred taxation in respect of timing differences arising between the carrying value of fixed assets and the related tax written down values.  Deferred taxation was not recognised under FRS 105.

	Basis of preparation
	The accounts have been prepared under the historical cost convention and in accordance with FRS 102, the financial reporting standard applicable in the UK and Republic of Ireland (as applied to small entities by section 1A of the standard).

	Functional and presentation currency
	The financial statements are presented in sterling and this is the functional currency of the company.

	Going concern
	After reviewing the company's forecasts and projections, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis of accounting in preparing its financial statements.

	Revenue from rendering of services
	Revenue from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. Turnover is only recognised to the extent of recoverable expenses when the outcome of a contract cannot be estimated reliably.

	Interest income
	Interest income is recognised using the effective interest rate method.

	Operating leases
	Where, substantially, all the risks and rewards of ownership of the asset do not transfer from the lessor to the company, the lease is treated as an operating lease. Rentals payable under operating leases are charged to the profit and loss account on a straight-line basis over the period of the lease.

	Employee benefits
	Short-term employee benefits are measured at the undiscounted amount expected to be paid in exchange for the employee's services to the company. Where employees have accrued short-term benefits which the entity has not paid by the balance sheet date, an accrual is recognised within creditors: amounts falling due within one year together with an associated expense in profit or loss. The liabilities are classified as current obligations in the statement of financial position because they are expected to be settled wholly within twelve months after the end of the period.

Employee benefits

Short-term employee benefits are measured at the undiscounted amount expected to be paid in exchange for the employee's services to the company. Where employees have accrued short-term benefits which the entity has not paid by the balance sheet date, an accrual is recognised within creditors: amounts falling due within one year together with an associated expense in profit or loss. The liabilities are classified as current obligations in the statement of financial position because they are expected to be settled wholly within twelve months after the end of the period.

	Defined contribution pension plan
	The company operates a defined contribution pension plan for the benefit of its employees. Contributions are recognised as expenses as they become payable. Differences between contributions payable in the year and those actually paid are recognised as either prepayments or accruals in the balance sheet. The assets of the defined contribution pension scheme are held separately from those of the company in an independently administered fund.

Defined contribution pension plan

The company operates a defined contribution pension plan for the benefit of its employees. Contributions are recognised as expenses as they become payable. Differences between contributions payable in the year and those actually paid are recognised as either prepayments or accruals in the balance sheet. The assets of the defined contribution pension scheme are held separately from those of the company in an independently administered fund.

	Finance costs
	Finance costs charged to the profit or loss include interest expense calculated using the effective interest method from FRS 102:11, finance charges on finance leases, and exchange differences on foreign currency borrowings where these are treated as an adjustment to interest costs.

	Foreign currency translation
	Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to profit or loss.

Foreign currency translation

Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to profit or loss.

	Current taxation
	Current tax is recognised in profit or loss, except for taxes related to revaluations of land and buildings which are recognised in other comprehensive income. Current tax represents the amount of tax payable (receivable) in respect of taxable profit (loss) for the current, or past, reporting periods. Current tax is measured at the amount expected to be paid (recovered) using the tax rates and laws which have been enacted, or substantively enacted, by the balance sheet date. Where payments to HM Revenue and Customs exceed liabilities owed, an asset is recognised to the extent of the amount of tax recoverable.

Current taxation

Current tax is recognised in profit or loss, except for taxes related to revaluations of land and buildings which are recognised in other comprehensive income.

Current tax represents the amount of tax payable (receivable) in respect of taxable profit (loss) for the current, or past, reporting periods. Current tax is measured at the amount expected to be paid (recovered) using the tax rates and laws which have been enacted, or substantively enacted, by the balance sheet date. Where payments to HM Revenue and Customs exceed liabilities owed, an asset is recognised to the extent of the amount of tax recoverable.

	Deferred tax
	Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.

Deferred tax

Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.

	Intangible assets
	Intangible assets are stated at cost less accumulated amortisation and accumulated impairment losses. The assets are reviewed for impairment if the above factors indicate that the carrying amount may be impaired. Amortisation is included in 'administrative expenses' in the profit and loss account. All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

Intangible assets

Intangible assets are stated at cost less accumulated amortisation and accumulated impairment losses. The assets are reviewed for impairment if the above factors indicate that the carrying amount may be impaired. Amortisation is included in 'administrative expenses' in the profit and loss account.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

	Tangible fixed assets and depreciation
	All fixed assets are initially recorded at cost. Property, plant and equipment is used in the company's principal activity for the production and supply of goods or for administrative purposes and is stated in the balance sheet under the historic cost model. This model requires the assets to be stated at cost less amounts in respect of depreciation and less any accumulated impairment losses. Depreciation is calculated so as to write off the cost of an asset, less its estimated residual value (which is the expected amount that would currently be obtained from disposal of an asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life), over the useful economic life of the respective asset as follows:

Tangible fixed assets and depreciation

All fixed assets are initially recorded at cost. Property, plant and equipment is used in the company's principal activity for the production and supply of goods or for administrative purposes and is stated in the balance sheet under the historic cost model. This model requires the assets to be stated at cost less amounts in respect of depreciation and less any accumulated impairment losses. Depreciation is calculated so as to write off the cost of an asset, less its estimated residual value (which is the expected amount that would currently be obtained from disposal of an asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life), over the useful economic life of the respective asset as follows:


		Straight line (years)
	Office Equipment	5

	Trade and other debtors
	Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.

Trade and other debtors

Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.

	Cash and cash equivalents
	Cash and cash equivalents comprise cash at bank and on hand, demand deposits with banks and other short-term highly liquid investments with original maturities of three months or less. Bank overdrafts are disclosed separately. For the purpose of the cash flow statement, bank overdrafts form an integral part of the company's cash management and are included as a component of cash and cash equivalents.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, demand deposits with banks and other short-term highly liquid investments with original maturities of three months or less.

Bank overdrafts are disclosed separately. For the purpose of the cash flow statement, bank overdrafts form an integral part of the company's cash management and are included as a component of cash and cash equivalents.

	Trade and other creditors
	Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method.

	Financial instruments
	The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

	Share capital
	Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.

	Related parties
	For the purposes of these financial statements, a related party could be a person or an entity. Careful consideration is given to the definition of a related party to ensure that all related party relationships, transactions and balances are identified.

	Government grants or assistance
	Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received. A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

Government grants or assistance

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received. 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

2.	Average number of employees


		2025		2024
	Average number of employees during the year	10		7

3.	Intangible assets

	Other	Total
	£	£
Cost or valuation
At 01 January 25	170	170
At 31 December 25	170	170
Amortisation and impairment
At 01 January 25	17	17
Charge for year	17	17
At 31 December 25	34	34
Net book value
At 31 December 25	136	136
At 31 December 24	153	153

4.	Tangible fixed assets

	Office Equipment	Total
	£	£
Cost or valuation
At 01 January 25	16,552	16,552
Disposals	(445)	(445)
At 31 December 25	16,107	16,107
Depreciation and impairment
At 01 January 25	3,235	3,235
Charge for year	3,258	3,258
On disposals	(117)	(117)
At 31 December 25	6,376	6,376
Net book value
At 31 December 25	9,731	9,731
At 31 December 24	13,317	13,317

5.	Debtors: amounts due within one year

	2025	2024
	£	£
Trade debtors / trade receivables	85,934	272,354
Other debtors	35,379	29,337
Prepayments and accrued income	38,153	33,939
Total	159,466	335,630

6.	Creditors: amounts due within one year

	2025	2024
	£	£
Trade creditors / trade payables	42,339	10,996
Bank borrowings and overdrafts	-	208
Amounts owed to related parties	4,200	4,200
Taxation and social security	67,117	40,519
Other creditors	13,488	35,243
Accrued liabilities and deferred income	251,946	381,116
Total	379,090	472,282

7.	Provisions for liabilities

	2025	2024
	£	£
Net deferred tax liability (asset)	1,305	2,616
Total	1,305	2,616

8.	Financial instruments
	Financial assets measured at fair value through profit or loss comprise of cash at the bank of £213,914 (2024: 123,283)

9.	Pension commitments
	The company operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £15,189 (2024 - £8,050) At the balance sheet date, unpaid contributions of £4,510 (2024 - £2,854) were due to the fund. They are included in other creditors.

Pension commitments

The company operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £15,189 (2024 - £8,050) At the balance sheet date, unpaid contributions of £4,510 (2024 - £2,854) were due to the fund. They are included in other creditors.

10.	Operating lease commitments
	At the balance sheet date, the company had total commitments under non-cancellable operating leases over the remaining life of those leases of £22,000 (2024: £77,000)

11.	Related party transactions
	During the year, the company received loans from, and made repayments of loans to, the director. At the balance sheet date, the company owed £8,977 (2024: £32,388) to the director. The loan is interest-free and repayable on demand. Included within turnover are sales and recharges to related companies of £446,515 for the period to 6th April 2025 (£1,927,923 for the year ended 31st December 2024). Following the acquisition of the company on 6 April 2025, the company became a wholly owned subsidiary. Accordingly, it has taken advantage of the exemption available under FRS 102 not to disclose transactions with fellow group undertakings. At the reporting date the company was owed £19,401 (2024: £295,165) by related parties and owed £4,200 (2024: £4,200) to related parties.

11.

Related party transactions

During the year, the company received loans from, and made repayments of loans to, the director.  At the balance sheet date, the company owed £8,977 (2024: £32,388) to the director.  The loan is interest-free and repayable on demand.

Included within turnover are sales and recharges to related companies of £446,515 for the period to 6th April 2025 (£1,927,923 for the year ended 31st December 2024). 

Following the acquisition of the company on 6 April 2025, the company became a wholly owned subsidiary.  Accordingly, it has taken advantage of the exemption available under FRS 102 not to disclose transactions with fellow group undertakings.

At the reporting date the company was owed £19,401 (2024: £295,165) by related parties and owed £4,200 (2024: £4,200) to related parties.

12.	Controlling party
	The immediate parent company is The Real Economy Effect GmbH, by virtue of its ownership of 100% of the issued share capital of the Company. The Real Economy Effect GmbH is incorporated in Switzerland, with its registered office at Grafenauweg 8, 6300 Zug, Switzerland. No consolidated financial statements are prepared for the group. The ultimate controlling party is Mrs Stephanie Galantine Heller by virtue of her shareholding in The Real Economy Effect GmbH.

12.

Controlling party

The immediate parent company is The Real Economy Effect GmbH, by virtue of its ownership of 100% of the issued share capital of the Company.  The Real Economy Effect GmbH is incorporated in Switzerland, with its registered office at Grafenauweg 8, 6300 Zug, Switzerland.  No consolidated financial statements are prepared for the group.

The ultimate controlling party is Mrs Stephanie Galantine Heller by virtue of her shareholding in The Real Economy Effect GmbH.

	Notes	2025		2024
		£	£	£	£
Fixed assets
Intangible assets	3		136		153
Tangible assets	4		9,731		13,317
			9,867		13,470
Current assets
Debtors	5	159,466		335,630
Cash at bank and on hand		213,914		123,283
		373,380		458,913
Creditors amounts falling due within one year	6	(379,090)		(472,282)
Net current assets (liabilities)			(5,710)		(13,369)
Total assets less current liabilities			4,157		101
Provisions for liabilities	7		(1,305)		(2,616)
Net assets			2,852		(2,515)
Capital and reserves
Called up share capital			100		100
Profit and loss account			2,752		(2,615)
Shareholders' funds			2,852		(2,515)