Brecher Connect LLP is a limited liability partnership incorporated in England and Wales. The registered office is 4th Floor, 64 North Row, London, W1K 7DA.
The limited liability partnership's principal activities are disclosed in the Members' Report.
These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in May 2024, together 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 limited liability partnerships subject to the small limited liability partnerships 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 limited liability partnership. 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.
Turnover represents the amounts recoverable for the services provided to clients, excluding value added tax, under contractual obligations which are performed gradually over time.
Revenue comprises sales of goods or services provided to customers net of value added tax and other sales taxes, less an appropriate deduction for actual and expected returns and discounts. Revenue is recognised when performance obligations are satisfied and the control of goods or services is transferred to the buyer. Where the performance obligation is satisfied over time, revenue is recognised in accordance with its progress towards complete satisfaction of that performance obligation.
When cash inflows are deferred and represent a financing arrangement, the promised consideration is adjusted for the effects of the time value of money, which is recognised as interest income.
The LLP does not have a written members’ agreement. The members have agreed that profits are divided by joint decision of the members, and that no individual member is entitled to payment of profits unless and until that decision is made. This arrangement displaces the default statutory profit-sharing provisions.
Members’ participation rights in the earnings and assets of the LLP are analysed between financial liabilities and equity in accordance with Section 22 of FRS 102 and the Statement of Recommended Practice, Accounting by Limited Liability Partnerships.
The profit and loss account ends with the profit or loss for the financial year available for discretionary division among members. Profits and losses retained pending a decision to divide them are included within members’ other interests in equity. Amounts due to members that are classified as liabilities are presented within creditors as loans and other debts due to members. Amounts recoverable from members are presented within debtors as amounts due from members and are shown in the analysis of members’ interests.
Where there is both an asset and a liability in respect of an individual member’s participation rights, the amounts are presented gross, unless the LLP has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis or to settle and realise the amounts simultaneously, in which case they are presented net.
The division of profits is subject to a joint decision of the members. The LLP retains discretion over whether profits are divided and, until a decision to divide profits is made, has an unconditional right to refuse payment of those profits. Amounts allocated to members following a discretionary division of profits are recognised directly in members’ interests when the decision to divide is made. Where a division creates a present obligation for the LLP to pay amounts to members, the corresponding liability is recognised within loans and other debts due to members.
During the year, the members decided to divide the profit for the year equally.
Losses are divided only after a joint decision of the members and therefore remain in equity until such a decision is made.
Once an unavoidable obligation has been created in favour of members through allocation of profits or other means, any undrawn profits remaining at the reporting date are shown as 'Loans and other debts due to members' to the extent they exceed debts due from a specific member.
The members’ participation rights that are classified as liabilities are repayable upon demand or at short notice (eg upon termination of membership), and as such whilst they are financing transactions, the effect of discounting is considered immaterial and so they are not discounted to present value.
The members do not provide substantive services to the LLP other than in their capacity as members, so no amounts are treated as remuneration for services. No amounts were fixed before profit was determined, and no members’ remuneration was charged to the profit and loss account as an expense.
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks.
The limited liability partnership 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 limited liability partnership's statement of financial position when the limited liability partnership becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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 assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the limited liability partnership transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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 limited liability partnership after deducting all of its liabilities.
Basic financial liabilities, including creditors, 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.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the limited liability partnership’s obligations expire or are discharged or cancelled.
The average number of persons (excluding members) employed by the limited liability partnership during the year was:
In the event of a winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors.