Company Registration No. 03818070 (England and Wales)
Citation Capital Management Limited
Annual report and financial statements
for the year ended 31 July 2023
Citation Capital Management Limited
Company information
Directors
Gaspard Boot
Richard Reinert
Secretary
Richard Reinert
Company number
03818070
Registered office
71 Queen Victoria Street
London
EC4V 4BE
Independent auditor
Saffery LLP
71 Queen Victoria Street
London
EC4V 4BE
Bankers
Revolut Payments UAB
Konstitucijos ave.
21B
Vilnius
Republic of Lithuania
LT-08130
Citation Capital Management Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 21
Citation Capital Management Limited
Strategic report
For the year ended 31 July 2023
1
The directors present the strategic report for the year ended 31 July 2023.
Fair review of the business
The principal activities of the company are the sourcing of investment capital for Private Equity opportunities mainly in the Natural Resource and Real Estate sectors.
For Private Equity Brokerage we have an experienced Commodity, Finance and Project Management team of professionals that we can call upon, covering every aspect of the natural resources sector from banking through to trading and risk management.
We were provided through the year with good global deal flow and applied comprehensive due diligence on mandated investment opportunities. These efforts have led to a steady flow of fee income during the past year and we are confident that our turnover in the coming year will continue to be positive year on year.
The company's operations do not expose it directly to the effects of changes in credit, liquidity and interest rate risks.
The company has no exposure to derivative financial instruments and or interest rate costs so as such even though we have a risk management policy there is no need to manage interest rate costs, and therefore no hedge accounting is applied.
The Key Performance Indicator (KPI) for the company financially is more and more related to the number of projects that we are introduced to for the purpose of raising investment capital as this increases the possibility of obtaining both retainer and success fees. In this regard we have experienced increased deal flow during 2022/2023. An important non-financial KPI for the company is to achieve recurring deal flow from the same sources as this indicates that we are meeting the project provider's expectations in a professional and timely manner.
Given the size of the company, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the Board, choosing instead to deal with this at Board level.
In the 2022-23 financial year, the Company made a gross profit of £25,514 (2022: £100,796) and a total comprehensive loss of £60,169 (2022: £3,438).
Principal risks and uncertainties
Credit risk:
The company has implemented policies that require appropriate due diligence on potential customers we accept to work with. The company currently has no clients introduced to any third-party derivative broker.
The amount of exposure to any individual counterparty is limited, and is assessed continually by the Board.
Liquidity and cash flow risk:
The company maintains sufficient cash in the bank to meet budgeted expenses. The company does not intend to take credit lines from its bank. Any debt finance would have to be approved by the Board of directors before it was taken on.
Interest rate risk:
The company has an interest-bearing asset, but no such liabilities. Interest bearing assets include only cash balances.
Price risk:
Expenditure made by the company is authorised prior to it being made by management in order to ensure that goods and services are not obtained at a higher price than necessary.
Citation Capital Management Limited
Strategic report (continued)
For the year ended 31 July 2023
2
Results and dividends
The results for the year are set out on page 9.
Future developments
The company does not intend to enter any new business sectors but rather concentrate its efforts on consolidating its current activities in the Private Equity Brokerage sector; this is due to the current uncertain global economic environment including rampant inflation and the war between Russia and Ukraine.
Richard Reinert
Director
20 November 2023
Citation Capital Management Limited
Directors' report
For the year ended 31 July 2023
3
The directors present their annual report and financial statements for the year ended 31 July 2023.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Gaspard Boot
Richard Reinert
Auditor
Saffery LLP have expressed their willingness to continue in office.
Energy and carbon report
As the company has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Richard Reinert
Director
20 November 2023
Citation Capital Management Limited
Directors' responsibilities statement
For the year ended 31 July 2023
4
The directors are responsible for preparing the Directors' Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the 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 company and of the profit or loss of the company 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;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the 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 company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Citation Capital Management Limited
Independent auditor's report
To the members of Citation Capital Management Limited
5
Opinion
We have audited the financial statements of Citation Capital Management Limited (the 'company') for the year ended 31 July 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the 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).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 July 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’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.
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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
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.
Citation Capital Management Limited
Independent auditor's report (continued)
To the members of Citation Capital Management Limited
6
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 year 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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
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.
Citation Capital Management Limited
Independent auditor's report (continued)
To the members of Citation Capital Management Limited
7
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 specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.
Identifying and assessing risks related to irregularities:
We assessed the susceptibility of the company’s financial statements to material misstatement and how fraud might occur, including through discussions with the directors, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the company by discussions with directors and by updating our understanding of the sector in which the company operates.
Laws and regulations of direct significance in the context of the company include The Companies Act 2006, UK Tax legislation and The Financial Services and Markets Act 2000, on which The Financial Conduct Authority (FCA) Handbook is based.
Audit response to risks identified
We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the company's records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance.
During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.
The company is regulated by the FCA. We discussed the company’s authorisation and permitted activities with the SMF16 and obtained evidence of this from the FCA register. We obtained additional evidence about compliance by discussing any breaches with the SMF16 and SMF17 and reviewing correspondence with the FCA.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the 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 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 company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Citation Capital Management Limited
Independent auditor's report (continued)
To the members of Citation Capital Management Limited
8
Timothy Gregory
Senior Statutory Auditor
For and on behalf of Saffery LLP
21 November 2023
Chartered Accountants
Statutory Auditors
71 Queen Victoria Street
London
EC4V 4BE
Citation Capital Management Limited
Statement of comprehensive income
For the year ended 31 July 2023
9
2023
2022
Notes
£
£
Turnover
3
316,546
235,969
Cost of sales
(291,032)
(135,173)
Gross profit
25,514
100,796
Administrative expenses
(91,224)
(92,348)
Operating (loss)/profit
4
(65,710)
8,448
Interest receivable and similar income
7
735
341
(Loss)/profit before taxation
(64,975)
8,789
Tax on (loss)/profit
8
10,907
(12,227)
Loss for the financial year
(54,068)
(3,438)
The income statement has been prepared on the basis that all operations are continuing operations.
Citation Capital Management Limited
Statement of financial position
As at 31 July 2023
10
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
4,689
14,653
Current assets
Debtors
10
96,696
149,410
Cash at bank and in hand
14,995
20,683
111,691
170,093
Creditors: amounts falling due within one year
11
(23,242)
(35,049)
Net current assets
88,449
135,044
Total assets less current liabilities
93,138
149,697
Provisions for liabilities
Provisions
12
4,111
4,111
Deferred tax liability
13
1,172
3,663
(5,283)
(7,774)
Net assets
87,855
141,923
Capital and reserves
Called up share capital
14
250,000
250,000
Profit and loss reserves
(162,145)
(108,077)
Total equity
87,855
141,923
The financial statements were approved by the board of directors and authorised for issue on 20 November 2023 and are signed on its behalf by:
Richard Reinert
Director
Company Registration No. 03818070
Citation Capital Management Limited
Statement of changes in equity
For the year ended 31 July 2023
11
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 August 2021
250,000
(104,639)
145,361
Year ended 31 July 2022:
Loss and total comprehensive income for the year
-
(3,438)
(3,438)
Balance at 31 July 2022
250,000
(108,077)
141,923
Year ended 31 July 2023:
Loss and total comprehensive income for the year
-
(54,068)
(54,068)
Balance at 31 July 2023
250,000
(162,145)
87,855
Citation Capital Management Limited
Statement of cash flows
For the year ended 31 July 2023
12
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
16
6,342
(17,679)
Income taxes paid
(12,765)
(5,007)
Net cash outflow from operating activities
(6,423)
(22,686)
Investing activities
Receipts arising from loans made
43,028
Interest received
735
341
Net cash generated from investing activities
735
43,369
Net (decrease)/increase in cash and cash equivalents
(5,688)
20,683
Cash and cash equivalents at beginning of year
20,683
Cash and cash equivalents at end of year
14,995
20,683
Citation Capital Management Limited
Notes to the financial statements
For the year ended 31 July 2023
13
1
Accounting policies
Company information
Citation Capital Management Limited is a private company limited by shares incorporated in England and Wales. The registered office is 71 Queen Victoria Street, London, EC4V 4BE.
1.1
Accounting convention
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.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover represents amounts receivable for consultancy services and commission income relating to investment advice provided, net of VAT.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is provided at rates calculated to write off the cost less estimated residual value of each asset over its expected useful life, as follows:
Plant and machinery
straight line over 3 years
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 credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
1
Accounting policies (continued)
14
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.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors, 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
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.
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
1
Accounting policies (continued)
15
Impairment of financial assets
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.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
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.
Other financial liabilities
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.
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
1
Accounting policies (continued)
16
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.8
Equity instruments
Equity instruments issued by the company 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 company.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
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. Where items recognised in other comprehensive income or equity are chargeable to or deductible for tax purposes, the resulting current or deferred tax expense or income is presented in the same component of comprehensive income or equity as the transaction or other event that resulted in the tax expense or income. Deferred tax assets and liabilities are offset when the company has 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.
1.10
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.11
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
17
2
Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
Areas of judgement include the recognition of a deferred tax asset on the company's accumulated taxable losses. The directors believe the company will be profitable in the future and that the deferred tax asset will be released in the future.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Commission Income
316,546
235,969
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
31,655
1,099
Europe
-
47,111
United States of America
253,236
156,627
Australia
31,655
21,132
UAE
-
10,000
316,546
235,969
2023
2022
£
£
Other revenue
Interest income
735
341
4
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
4,402
(1,155)
Depreciation of owned tangible fixed assets
9,964
9,964
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
18
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
14,220
13,640
For other services
All other non-audit services
10,769
13,513
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
2
2
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
735
341
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
13,241
Adjustments in respect of prior periods
(8,416)
Total current tax
(8,416)
13,241
Deferred tax
Origination and reversal of timing differences
(2,491)
(2,491)
Changes in tax rates
1,477
Total deferred tax
(2,491)
(1,014)
Total tax (credit)/charge
(10,907)
12,227
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
8
Taxation (continued)
19
The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
(Loss)/profit before taxation
(64,975)
8,789
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 21.01% (2022: 19.00%)
(13,651)
1,670
Tax effect of expenses that are not deductible in determining taxable profit
11,618
11,571
Tax effect of utilisation of tax losses not previously recognised
2,033
Adjustments in respect of prior years
(8,416)
Deferred tax movement
(2,491)
(1,014)
Taxation (credit)/charge for the year
(10,907)
12,227
9
Tangible fixed assets
Plant and machinery
£
Cost
At 1 August 2022 and 31 July 2023
29,892
Depreciation and impairment
At 1 August 2022
15,239
Depreciation charged in the year
9,964
At 31 July 2023
25,203
Carrying amount
At 31 July 2023
4,689
At 31 July 2022
14,653
10
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
11,876
59,856
Corporation tax recoverable
7,940
Other debtors
76,880
89,554
96,696
149,410
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
20
11
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
3,952
6,315
Corporation tax
13,241
Accruals and deferred income
19,290
15,493
23,242
35,049
12
Provisions for liabilities
2023
2022
£
£
4,111
4,111
Movements on provisions:
£
At 1 August 2022 and 31 July 2023
4,111
13
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2023
2022
Balances:
£
£
ACAs
1,172
3,663
2023
Movements in the year:
£
Liability at 1 August 2022
3,663
Credit to profit or loss
(2,491)
Liability at 31 July 2023
1,172
Citation Capital Management Limited
Notes to the financial statements (continued)
For the year ended 31 July 2023
21
14
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
250,000 Ordinary share capital of £1 each
250,000
250,000
15
Related party transactions
As at 31 July 2023 there is an amount due from Mr Reinert of £76,881 (2022: £76,881) included within other debtors. This relates to a historic loan that Mr Reinert was a guarantor for on behalf of another company that has since been wound up.
As at 31 July 2023 there is an amount owed to the company of £nil (2022: £12,674) in respect of a short term loan to a close member of Mr Reinert's family.
16
Cash generated from operations
2023
2022
£
£
(Loss)/profit for the year after tax
(54,068)
(3,438)
Adjustments for:
Taxation (credited)/charged
(10,907)
12,227
Investment income
(735)
(341)
Depreciation and impairment of tangible fixed assets
9,964
9,964
(Decrease)/increase in provisions
516
Movements in working capital:
Decrease/(increase) in debtors
60,654
(38,059)
Increase in creditors
1,434
1,452
Cash generated from/(absorbed by) operations
6,342
(17,679)
17
Analysis of changes in net funds
1 August 2022
Cash flows
31 July 2023
£
£
£
Cash at bank and in hand
20,683
(5,688)
14,995
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