The directors present the strategic report for the period ended 31 December 2025.
The group operates in a market undergoing significant technological and regulatory change. Financial advice firms continue to seek solutions that improve operational efficiency, support compliance requirements and enhance the client experience.
The group has positioned itself as an AI-embedded software provider that replaces fragmented technology environments with an integrated platform designed specifically for financial advice businesses.
During the period, the group established the workforce, systems and corporate functions required to operate on a stand-alone basis, while continuing significant investment in its new technology platform.
The group benefits from the long-established reputation gained by the subsidiary within the sector, which has a heritage of supporting financial services organisations since 1993. The group has continued to maintain relationships with a number of significant financial institutions, demonstrating the resilience and quality of its technology solutions.
Strategy
The group's strategy is focused on four key objectives:
Product Innovation
Continuing investment in AI-enabled advice technology, automation and digital engagement tools to improve adviser productivity and consumer outcomes. Also transforming the level of straight through processing with the investment platforms.
Customer Growth
Expanding the customer base beyond the enterprise networks, banks and wealth managers to include the wider financial advice market, including unique tools to help consolidators.
System Consolidation
Supporting firms in replacing multiple disconnected systems with a single integrated advice management platform.
Partnership Development
Building long-term relationships with customers and strategic partners, leveraging the subsidiary's established track record in regulated financial services technology.
The principal risks and uncertainties facing the group are detailed below:
Technology and Cyber Security Risk
As a technology provider operating within the regulated financial services sector, the group maintains robust information security controls which protect sensitive customer and consumer data. The group mitigates this risk through ongoing investment in security infrastructure and operational controls. The group highlights its ISO 27001 certification and the long-term past operational resilience of its subsidiary as key strengths.
Regulatory Risk
Changes in financial services regulation may affect customer requirements and product development priorities. The group actively monitors regulatory developments to ensure its solutions continue to meet market and compliance needs.
Competitive Risk
The financial technology market remains highly competitive. The group's mitigation strategy is centred on product innovation, customer service, domain expertise and continued investment in AI-driven technology.
Growth and Delivery Risk
As the business expands, there is a risk associated with scaling operations and successfully delivering customer implementations. Management maintain a structured project governance and resource planning process to support growth.
Employees
The success of the group depends on the skills, expertise and commitment of its employees. Management recognise that attracting and retaining talented individuals is fundamental to maintaining product quality, customer satisfaction and innovation. The group seeks to foster a collaborative and inclusive working environment that supports professional development and continuous improvement.
Reputational risk
The group relies on its ability to deliver good service and fair client and customer outcomes, and there is a risk that it fails to achieve this through operational activities and the implementation of change programmes. This could lead to customer and client harm, reputational damage, and loss of income. Being client and customer-led is a commitment and will be an essential aspect of the group's future culture. This will mean continuous focus on client and customer outcomes is fundamentally important.
Evolving and emerging risks
The group is vigilant to risks that could crystallise over different horizons and impact its future strategy, operations and clients. These risks vary in nature as they cover geopolitical, economic, societal, technological, legal, regulatory and environmental themes. Internal and external research will be reviewed to consider how risks could emerge and evolve.
Third party management
The group relies on a number of third parties, including cloud, technology, data, development and operational service providers. Failure, disruption, security weakness, financial distress or service deterioration at a critical supplier could affect product delivery, service availability, customer commitments and regulatory compliance. The group manages this risk through supplier due diligence, contractual controls, ongoing performance and risk monitoring, information-security assessment, business-continuity planning and exit or substitution planning where
proportionate.
AI Risk Management
The increasing use of AI, automated decision support and optimisation technology creates risks relating to data quality, output accuracy, explainability, model governance, regulatory change and inappropriate reliance on automated outputs. The group applies development, testing, validation, change-control and security processes designed to ensure that technology is used within defined parameters and with appropriate customer and human oversight. The group also reviews its AI Policy on a regular basis.
Management monitors a range of operational and commercial performance indicators, including:
Customer acquisition and retention.
Adoption and usage of the group's software platform.
Delivery of implementation and migration projects.
Software reliability and service availability.
Product development milestones.
Revenue growth and recurring income generation.
The group reports significant efficiency improvements for customers using its platform, including reductions in adviser preparation time, improved case completion rates and increased client servicing capacity.
The group uses a number of financial KPIs to monitor the performance of the business throughout the financial period.
The company did not trade during the year but monitored the KPIs adopted by its subsidiary carefully throughout the period. Management monitors a range of operational and commercial performance indictors, including:
Customer acquisition and retention.
Adoption and usage of the Company's software platform.
Delivery of implementation and migration projects.
Software reliability and service availability.
Product development milestones.
Revenue growth and recurring income generation.
The group reports significant efficiency improvements for customers using its platform, including reductions in adviser preparation time, improved case completion rates and increased client servicing capacity.
The group uses a number of financial KPIs to monitor the performance of the business throughout the year. The KPIs are shown below relate to the subsidiary:
2025 2024
£ £
Revenue 5,282,333 5,527,640
Operating profit (loss) (2,230,796) 1,266,102
Equity attributable to shareholders 9,404,916 11,464,396
The change in profitability principally reflects the group's first full year operating independently following the
December 2024 management buyout, including the full-year cost of employees and stand-alone operating functions
previously borne or allocated through the Aberdeen Group. The result also reflects significant investment in the
development and launch of the group's new technology platform alongside a reduction in support revenue for
legacy solutions.
After consolidation adjustments, the group made an operating profit of £106,571 for the period and the equity attributable to shareholders of the parent company at the period end was £689,783.
Revenue
Revenue has decreased based on results prior to the formation of the group, largely as a result of a reduction in support revenue due to a large support from legacy solutions offset by an increase in licence revenue for the new Focus. Tech solutions.
Operating profit
Operating profit has decreased based on results prior to the formation of the group, driven by a combination of the decrease in revenue and increase in costs arising as a result of leaving the Aberdeen Group.
Equity attributable to shareholders
Equity attributable to shareholders has decreased a result of losses made during the year.
Environmental matters
As a software and services business, the group’s direct environmental impact is limited, but it recognises the environmental effects associated with office energy use, cloud infrastructure, business travel and its supply chain.
The group seeks to manage and reduce those impacts where practicable and is continuing to develop its approach to environmental measurement and reporting.
On behalf of the board
The directors present their annual report and financial statements for the period ended 31 December 2025.
The results for the period are set out on page 11.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
The auditor, Streets Audit LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
United Kingdom company law requires the directors to prepare financial statements for each financial year. Under that law, the directors have elected to prepare the group and parent company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the directors 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 group and parent company, and of the profit or loss of the group for that period.
In preparing these financial statements, the directors 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 United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and parent company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and parent company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and parent company, and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and parent company, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of Focus Advice Technology Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2025 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' 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 group's and parent company'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 directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
The information given in the strategic report and the directors' report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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:
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 engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the group through discussions with directors and other management, and from our commercial knowledge and experience of the group and the sector in which it operates;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group, including health and safety legislation, the Companies Act 2006, taxation legislation, employment and environmental legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the group's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates set out in Note 2 were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance; and
enquiring of management as to actual and potential litigation and claims.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
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.
Use of our report
This report is made solely to the parent company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the parent company’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 parent company and the parent company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
As permitted by section 408 of the Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £20.
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The notes on pages 17 to 36 form part of these financial statements.
The notes on pages 17 to 36 form part of these financial statements.
Focus Advice Technology Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 8 Hamilton Terrace, Leamington Spa, CV32 4LY.
The group consists of Focus Advice Technology Holdings Limited and its subsidiary, Focus Business Solutions Limited.
The company was incorporated on 5 November 2024. It extended its first accounting period to 31 December 2025 to be consistent with the accounting year end of its subsidiary.
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.
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.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company Focus Advice Technology Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 December 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.
If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.
Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.
At the time of approving the financial statements, the directors have a reasonable expectation that the group and parent 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.
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.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
The group’s key revenue activities are listed below:
Licence fees
The group offers a wide range of software solutions, from single subscription agreements to custom-build products. Revenue from these contracts are recognised either over time or at a point in time based on the recognition criteria set out in the Critical accounting judgements and key sources of estimation uncertainty later in accounting policies. Revenue from these contracts are subject to being rebased based on CPI/RPI. Amounts receivable on contracts relates to licence fees.
Professional Services
The professional services provided to the group’s customers are provided on a time and material basis or as a fixed-price contract, with contract terms generally ranging from less than one year to three years. Revenue from fixed-price professional services contracts is recognised under the input method. Progress is measured on the basis of the ratio of the costs incurred to date to satisfy a performance obligation over the total estimated amount of costs that will be incurred.
Revenue from variable professional services contracts is recognised at the contractual rates as labour hours are delivered.
Support and Maintenance and Hosting
Revenue from fixed-price contracts for support and maintenance and hosting are recognised over the time period to which the contract relates. This reflects the performance obligation to provide a service to the customer across the agreed time period.
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 recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
At each reporting period end date, the group 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. The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group 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 group's balance sheet when the group 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.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
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 impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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 group 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.
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 being measured at 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 group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group 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 group.
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 group’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 carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
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.
At inception, the group assesses whether a contract is, or contains, a lease. A lease arises where the
contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Control of the use of an asset occurs where the company has both the right to direct the use of the asset, and the right to obtain substantially all the economic benefits from that use.
Where a tangible asset is acquired through a lease, the group recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within the same line items on the Balance sheet as owned assets.
The right-of-use asset is initially measured at cost, which comprises the initial measurement of the lease liability adjusted for lease payments made at or before the commencement date less any lease incentives or grants received, plus initial direct costs and an estimate of the cost of obligations to dismantle, remove or restore the underlying asset and the site on which it is located.
The right-of-use asset is subsequently adjusted for remeasurements of the lease liability and applies the relevant cost model, fair value model or revaluation model as set out within the accounting policies for the applicable asset class. Where the cost model is applied, the asset is depreciated from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term, and is periodically reduced by impairment losses, if any.
The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the group's incremental borrowing rate or the group's obtainable borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be payable under residual value guarantees, the exercise price of any purchase options that the group is reasonably certain to exercise, and any penalties for early termination of a lease.
At each financial period end, the lease liability is adjusted to reflect payments made and interest accrued. Also, the lease liability is remeasured to reflect lease modifications and any changes to the factors considered at initial measurement, as set out above. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or recognised in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The group has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.
Amounts receivable on contracts and accrued income
Amounts receivable on contracts relates to licence fees. Licence fees are recognised in the profit and loss account and invoiced periodically over the duration of the contracted period. Any unbilled licence fees that have been recognised as revenue are accounted for as accrued income. Accrued income relates to support & maintenance, professional services, and hosting fees that are unbilled at the balance sheet date but revenue recognition requirements under FRS 102 have been met.
Deferred income
Where the group receives fees in advance (front-end fees) for services it is providing these fees are
initially recognised as a deferred income liability and released to the income statement over the period services are provided.
In the application of the group’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 following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Revenue from contracts with customers introduced a new five-step model for recognising
revenue. Part of this model requires the determination of the transaction price, allocation of the transaction price to the performance obligations in the contract and recognising revenue when or as the entity satisfies the performance obligation.
There is a critical accounting judgement in the determination of the amount and timing of revenue from contracts with customers. Contracts with customers are either settled over time or at a point in time. In order to achieve this for licence fees contracts, it needs to be determined if the contract is “distinct” from other goods and services offered in the contract and therefore constitutes a separate performance obligation. For distinct licence fee contracts, further consideration needs to be given around whether an entity’s promise in granting a licence is a promise to provide a right to access the entity’s intellectual property, or right to use. This will determine the over time or at a point in time recognition of the licence.
For contracts recognised at a point in time, judgement is applied to determine if the customer can direct the use of and obtain substantially all the remaining benefits from the licence at the point in time at which the licence transfers and revenue is recognised. In the case of point in time recognition on licence fees, there is also a significant accounting judgement concerning the date of the commencement of the licence. Management considers this based on the agreed contract and other facts and circumstances concerning when the licence is delivered to the customer.
During the period, the directors made a judgment concerning certain software project development costs that should be capitalised and amortised over ten years. The directors reached their decision after considering certain factors such as technical feasibility, intention to complete, ability to use or sell, probability of future economic benefits and adequate resources to complete. Having done this, they also needed to be able to reliably measure the costs associated with the projects. During the year, £3,602,672 costs were capitalised.
Negative goodwill relating to monetary assets of £8,847,154 arose upon consolidation. The directors have concluded that the period over which the company is expected to benefit from the acquisition to be four years. This is based upon the risks associated with the delivery of ongoing contracts, the delivery risks of new products and the period until when the subsidiary is expected to become profit making. Therefore, the negative goodwill relating to monetary assets recognised in the group's profit and loss account for the period is £2,211,788.
The average monthly number of persons (including directors) employed by the group and company during the period was:
Their aggregate remuneration comprised:
As at 31 December 2025, the group had a total of 67 employees (including 3 directors). For the majority of the previous year, there were no individuals directly employed by the subsidiary, Focus Business Solutions Limited. Following the management buy-out in December 2024, employees were transferred to Focus Business Solutions Limited under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”), and the company became the direct employer from that date onward.
The aggregate remuneration of the directors paid by the subsidiary was £694,812 (2024: £nil). No salaries were paid by the subsidiary in the previous year as all directors remained on the Aberdeen Group payroll throughout December 2024 as part of the deal after the management buy-out on 13 December 2024.
The subsidiary paid £67,370 (2024: £3,700) into defined contribution pension schemes. The previous year's amount relates solely to pension contributions accrued for the period from 14 December 2024 to 31 December 2024, following the transfer of employees under the management buy-out.
During the year retirement benefits accrued to no directors (2024: £nil) in respect of defined contribution pension schemes and there was no share options exercised during the year (2024: £nil).
The actual charge for the period can be reconciled to the expected charge/(credit) for the period based on the profit or loss and the standard rate of tax as follows:
Negative goodwill arose upon consolidation. It has been released to the consolidated profit and loss on the following basis:
Non-monetary assets
Right of use asset £255,554 - over four and a half years, the remaining period of the lease at acquisition
Deferred tax asset £68,809 - over one year, in accordance with the movement in 2025
Monetary assets
£8,847,153 - over four years, the period that it is expected the company will benefit from the acquisition
Software development costs represent expenditure incurred during the year on ongoing software projects that will generate benefits in the future. In reaching their decision, the directors have considered that the projects meet the following criteria; they are technically feasible; there is a clear intention to complete; there is an ability to use or sell the end product; there is a credible basis to expect the software to generate future income; there are adequate resources to complete the projects and the associated costs can be measured reliably.
In connection with the acquisition of 80% of Focus Business Solutions Limited (“FBS”), the company entered into a put and call option agreement with Aberdeen Holdings Ltd. Aberdeen Holdings Ltd may require the company to acquire its remaining interest in FBS at any time for a non-material amount. Following certain specified events Aberdeen Holdings Ltd may require the company to sell some or all its shares in FBS to Aberdeen Holdings Ltd for a non-material amount. The management are not aware of any circumstances that would give rise to either of these options being exercised.
Details of the company's subsidiaries at 31 December 2025 are as follows:
Balances relating to contract receivables at the year end, included in trade debtors, totalled £90,829.
Prior to acquisition the subsidiary acquired a lease for an office building. Leases are generally for fixed periods but may be subject to extensions or early termination clauses. The remaining period for the current lease is three and a half years at 31 December 2025. The subsidiary reviews its property use on an ongoing basis.
Lease liabilities maturity analysis
The following table provides analysis of the maturity analysis of the cash flows for the lease liabilities:
Year Rental payment PV of cash payment Interest
£ £ £
1 2024 0 0 11,492
2 2025 75,367 71,551 18,827
3 2026 98,840 88,600 13,525
4 2027 98,840 83,973 8,880
5 2028 98,840 79,588 4,978
6 2029 41,183 31,923 604
Totals 413,070 355,635 58,306
The following are the major deferred tax liabilities and assets recognised by the group and company:
Deferred tax assets are recognised to the extent it is probable that sufficient future taxable profits will be available for the group, against which the deferred tax assets can be recovered. Their recoverability is measured against anticipated taxable profits and gains based on business plans for the group. Due to uncertainty regarding recoverability, deferred tax assets have not been recognised in respect of the tax losses carried forward of £1,939,825.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
On 13 December 2024 the company acquired 80% of the issued capital of Focus Business Solutions Limited.
The negative goodwill arising on the acquisition of the business is attributable to the anticipated future losses and the risks associated with the success of bringing new products to the market.
Negative goodwill relating to non-monetary assets of £324,363 arose upon consolidation. £255,554 relates to a right of use asset which will be recognised in the profit and loss over the term of the lease, being four and a half years and £68,809 relates to a deferred tax asset which has been recognised in full in the current period.
Negative goodwill relating to monetary assets of £8,847,154 arose upon consolidation. The directors have concluded that the period over which the company is expected to benefit from the acquisition to be four years. This is based upon the risks associated with the delivery of ongoing contracts, the delivery risks of new products and the period until when the subsidiary is expected to become profit making.
The negative goodwill recognised in the group profit and loss account in the current period is £2,337,387, of which £125,599 relates to non-monetary assets and £2,211,788 relates to monetary assets.
To the knowledge of the Directors, there have been no material events after the reporting period.
Total compensation of key management personnel (including the directors) amounted to £762,182 including payments into defined contribution pension schemes.