REGISTERED NUMBER: |
Strategic Report, Report of the Director and |
Audited Financial Statements for the Year Ended 30 April 2023 |
for |
SPRUNG STUDIOS LTD |
REGISTERED NUMBER: |
Strategic Report, Report of the Director and |
Audited Financial Statements for the Year Ended 30 April 2023 |
for |
SPRUNG STUDIOS LTD |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Contents of the Financial Statements |
for the year ended 30 April 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Director | 5 |
Report of the Independent Auditors | 7 |
Statement of Comprehensive Income | 11 |
Balance Sheet | 12 |
Statement of Changes in Equity | 13 |
Cash Flow Statement | 14 |
Notes to the Cash Flow Statement | 15 |
Notes to the Financial Statements | 16 |
SPRUNG STUDIOS LTD |
Company Information |
for the year ended 30 April 2023 |
DIRECTOR: |
REGISTERED OFFICE: |
BUSINESS ADDRESS: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditors |
Chartered Accountants |
Preston Park House |
South Road |
Brighton |
East Sussex |
BN1 6SB |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Strategic Report |
for the year ended 30 April 2023 |
The director presents his strategic report for the year ended 30 April 2023. |
REVIEW OF BUSINESS |
The company has had a strong trading performance in 2023 and continues to attract new talent and grow headcount which is a key driver of performance for the business. Average headcount at the year end is 75 staff across both UK and Canadian studios, an increase of 5 on average compared to the previous year. The company continues to be well placed to take advantage of the growing video games market and it has continued to trade satisfactorily since the balance sheet date. |
The results are as follows: |
Turnover: £9,016,891 (2022: £6,912,624) |
Gross Profit of £8,946,189 (2022: £6,769,542) |
Operating Profit of £2,586,868 (2022: £2,824,212) |
Net assets of £6,570,243 (2022: £5,814,190) |
The main financial highlights are as follows: |
Gross profit margin increased by 1.3% to 99.2%. |
Turnover increased by 30.4% to £9,016,891 |
The company is part of a group headed by Sprung Holdings Ltd, a company incorporated in Canada. The company is controlled by James Chaytor. |
Governance and risk management framework |
The leadership team is ensuring that robust processes are in place to identify, manage and report risks that threaten the business objectives of the company. |
These include Financial, Operational and Regulatory Compliance risks. The principal feature of the company's risk management regime is a strong control environment, which is founded on an appropriate organisational structure for planning, executing, controlling and monitoring business operations. It includes clearly defined responsibilities and accountabilities. |
Control procedures |
These include: budgetary systems and management controls to manage financial risk, timely and accurate management information in respect of key performance measures and procedures to ensure complete and accurate accounting, which are regularly reviewed by the leadership team. |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Strategic Report |
for the year ended 30 April 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
There are a number of risks and uncertainties that can impact the performance of the company, some of which are beyond the control of the company and its board. The principal risks and uncertainties facing the company, as well as how the company works to mitigate these are set out below: |
Client |
The risk of project cancellation and client confidence is managed by providing high quality products on time and to client specifications. Projects are managed through milestones and progress against these is reported to the operating board on a monthly basis and weekly at the project level. |
The risk of over reliance on key clients is managed through monitoring of the company's client concentration and actively seeking to work with other clients across the industry to diversify the client base. |
Staff |
The operations of the company depend upon the continuing employment of key staff and, due to the specialised sector in which it operates, the ability to recruit and retain people with the expertise and experience required. To achieve this, the company provides what it believes to be competitive remuneration commensurate with the industry plus best-in-class benefits across both studios. |
The company seeks to continually develop its recruitment and retention activities. |
Global Events |
Globally, countries are faced with cost of living and climate change challenges. In addition, the conflict between Russia and Ukraine remains ongoing. The impact of these challenges on the company have been considered and no material impact is anticipated. |
The impact of mass layoffs in the industry is being actively monitored and has the potential to either reduce workload or increase it. Continued and sustained marketing activities will offset the risk of project cancellations. |
IT security and stability |
Breach of IT security, unauthorised copying or software piracy could result in loss of business and reputational damage for the company, as well as associated negative financial impacts to revenue and costs from unauthorised copying of the intellectual property of clients. |
Complete protection cannot be guaranteed, and an IT security breach could cause significant disruption to the company's operations. |
Mitigating activities |
The company's project work is protected by copy protection technology intended to prevent piracy. |
The company conducts robust testing on systems and software, including penetration testing by external consultants. The implementation of action plans that arise from the results of testing is monitored by the leadership team. |
Disaster recovery plans have been developed to ensure the business can recover from any interruptions with minimal impact. |
Credit risk |
The company's credit risk arises primarily through trade debtors. The amounts presented in the balance sheet are net of bad debt provisions. A bad debt provision is recognised by the entity when there is objective evidence that a debtor has become impaired. |
Cash flow risk |
The company is exposed to the financial risk of changes in foreign exchange rates and interest rates. The company retains significant amount of cash and is all equity financed. |
Liquidity risk |
In order to maintain liquidity and to ensure that the company has sufficient funds available for ongoing operations and to meet its obligations, the company places surplus funds into fixed term deposit accounts. |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Strategic Report |
for the year ended 30 April 2023 |
FUTURE DEVELOPMENTS |
The Director feels that the company is well placed to continue its growth in subsequent years and continue to grow customer base and sales. |
ON BEHALF OF THE BOARD: |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Report of the Director |
for the year ended 30 April 2023 |
The director presents his report with the financial statements of the company for the year ended 30 April 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of engaging in user experience, user interface design, user research and development for the video game industry. |
DIVIDENDS |
Four interim dividends per Ordinary share were paid throughout the year as follows: |
1 February 2023 | £3,040.68 |
2 February 2023 | £3,070.67 |
6 February 2023 | £3,092.38 |
7 February 2023 | £3,097.80 |
£12,301.53 |
No dividends were paid in the year ended 30 April 2022. |
The director does not recommend the payment of a final dividend. |
RESEARCH AND DEVELOPMENT |
The company continues to invest in the development of Artificial Intelligence in relation to developing tools that |
assist the company in developing high quality products and ensure it is equipped to deal with continuing developments in this sector. This research and development will ensure that the company is able to evolve with the requirements of its customers. |
DIRECTOR |
POLITICAL DONATIONS AND EXPENDITURE |
The company made no political donations in the year ended 30 April 2023 (2022: £Nil). |
GOING CONCERN |
The director has a reasonable expectation that the company has adequate resources to continue in existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements. |
EXISTENCE OF BRANCHES OUTSIDE OF THE UK |
The company has a branch, as defined in s1046(3) of the Companies Act 2006, outside of the UK as follows: |
Canada | 1500 W Georgia St Suite 1400, Vancouver, BC V6G 2Z6 |
DIRECTORS INDEMNITIES |
The company has made no qualifying third party indemnity provisions for the benefit of the Director. |
DISCLOSURE IN THE STRATEGIC REPORT |
Certain matters required by regulation to be dealt with in the annual report have been dealt with in the Strategic Report rather than in the Director's Report. These include principle risks and uncertainties and future developments. |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Report of the Director |
for the year ended 30 April 2023 |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
The auditors, Feist Hedgethorne Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Sprung Studios Ltd |
Opinion |
We have audited the financial statements of Sprung Studios Ltd (the 'company') for the year ended 30 April 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 30 April 2023 and of its profit 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. |
Basis for opinion |
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 Auditors' 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 director's 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 director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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. |
Other matter |
The accounts for the year ended 30 April 2022 were not audited, however we have made all the necessary attempts to ensure that the comparative figures show a true and fair view and are therefore free from material misstatement. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
Sprung Studios Ltd |
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 Report of the Director. |
We have nothing to report in respect of the following matters where 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 director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on page six, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. |
Report of the Independent Auditors to the Members of |
Sprung Studios Ltd |
Auditors' 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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
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. |
The extent to which the audit was considered capable of detecting irregularities including fraud |
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: |
- | the 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 company through discussions with directors and other management, and from our commercial knowledge and experience; |
- | 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 company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety 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 company’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 to 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; |
- | enquiring of management as to actual and potential litigation and claims; and |
- | reviewing correspondence with HMRC and the company’s legal advisors. |
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. |
Report of the Independent Auditors to the Members of |
Sprung Studios Ltd |
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 Report of the Auditors. |
Use of our 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 a Report of the Auditors 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. |
for and on behalf of |
Statutory Auditors |
Chartered Accountants |
Preston Park House |
South Road |
Brighton |
East Sussex |
BN1 6SB |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Statement of Comprehensive |
Income |
for the year ended 30 April 2023 |
2023 | 2022 |
(Unaudited) |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Administrative expenses | ( |
) | ( |
) |
2,571,679 | 2,816,841 |
Other operating income |
OPERATING PROFIT | 5 |
Interest receivable and similar income |
PROFIT BEFORE TAXATION |
Tax on profit | 6 | ( |
) | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Balance Sheet |
30 April 2023 |
2023 | 2022 |
(Unaudited) |
Notes | £ | £ |
FIXED ASSETS |
Tangible assets | 8 |
CURRENT ASSETS |
Debtors | 9 |
Investments | 10 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 11 | ( |
) | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 13 | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 14 |
Retained earnings | 15 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the director and authorised for issue on |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Statement of Changes in Equity |
for the year ended 30 April 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 May 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 30 April 2022 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 30 April 2023 |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Cash Flow Statement |
for the year ended 30 April 2023 |
2023 | 2022 |
(Unaudited) |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Tax paid | ( |
) |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Fixed term deposits | ( |
) |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
Amount introduced by directors | 312 | 312 |
Amount withdrawn by directors | (2,479 | ) | (4,734 | ) |
Equity dividends paid | ( |
) |
Net cash from financing activities | ( |
) | ( |
) |
(Decrease)/increase in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
4,067,607 |
Cash and cash equivalents at end of year | 2 | 3,690,810 | 5,968,834 |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Cash Flow Statement |
for the year ended 30 April 2023 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
(Unaudited) |
£ | £ |
Profit before taxation |
Depreciation charges |
Profit on disposal of fixed assets | ( |
) |
(Gain)/ Loss on foreign exchange | 99,311 | (1,089 | ) |
Finance income | (39,669 | ) | (380 | ) |
2,791,119 | 2,927,391 |
Increase in trade and other debtors | ( |
) | ( |
) |
Increase in trade and other creditors |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 30 April 2023 |
30.4.23 | 1.5.22 |
£ | £ |
Cash and cash equivalents | 3,690,810 | 5,968,834 |
Year ended 30 April 2022 |
30.4.22 | 1.5.21 |
(Unaudited) |
£ | £ |
Cash and cash equivalents | 5,968,834 | 4,067,607 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.5.22 | Cash flow | At 30.4.23 |
£ | £ | £ |
Net cash |
Cash at bank | 5,968,834 | (2,278,024 | ) | 3,690,810 |
5,968,834 | ( |
) | 3,690,810 |
Liquid resources |
Current asset investments | - | 1,755,642 | 1,755,642 |
- | 1,755,642 | 1,755,642 |
Total | 5,968,834 | (522,382 | ) | 5,446,452 |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements |
for the year ended 30 April 2023 |
1. | STATUTORY INFORMATION |
Sprung Studios Ltd is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
The functional currency is Canadian Dollars (C$). The reason the financial statements are presented in as GBP (£) opposed to C$ is that the company is incorporated in the United Kingdom, with accounts filed with the UK registrar and hence the Director considers the presentation in £ to be more appropriate and more useful to users of the financial statements in the UK. |
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below. |
Monetary amounts in these financial statements are rounded to the nearest pound. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Significant judgements and estimates |
Preparation of the financial statements requires management to make significant judgements and estimates and these 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. |
The items in the financial statements where these judgements and estimates have been made include the useful economic life of tangible fixed assets, the depreciation of these assets and recoverability of debtors. |
Key sources of estimation uncertainty: |
The annual depreciation charge for tangible fixed assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are depreciation over the approved depreciation rates. The carrying amount of tangible fixed assets is £314,818 (2022: £313,173) as noted in note 8. |
No significant judgements have been made by management in preparing these financial statements. |
Turnover |
Revenue is measured at the fair value of the consideration received or receivable net of VAT and trade discounts, and is recognised as follows: |
Revenue from the sale of game development services is recognised on completion of the work, based on set criteria of budget and work agreed. |
Revenue for work that has been completed but not yet billed is included in debtors in the Balance Sheet and turnover in the Statement of Comprehensive Income. Revenue for work that has been billed in advance of the company satisfying the performance obligation is included in creditors in the Balance Sheet and recognised as turnover when the performance obligation has been satisfied. |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
Tangible fixed assets are stated at cost, or deemed cost, less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended by management. |
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life. |
Fixtures & fittings | - | 25% on reducing balance |
Motor Vehicles | - | 25% on reducing balance |
Computer equipment | - | 25% on reducing balance |
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 assets, 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 entity after deducting all of its financial liabilities. |
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument. |
Basic financial assets |
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. |
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 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. |
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. |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
2. | ACCOUNTING POLICIES - continued |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Impairment |
At each balance sheet date, the Company reviews the carrying amount of its assets to determine whether there is any indication that any items have suffered an impairment loss. If any such indication exists, the recoverable amount of an 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 asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. |
Current asset investments |
Current asset investments relate to fixed term deposits and are recognised at cost. Interest on the deposit is recognised as it accrued and interest earned but not yet received is included in debtors. |
Going concern |
The director has a reasonable expectation that the company has adequate resources to continue in existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements. |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
2. | ACCOUNTING POLICIES - continued |
Pension costs and other post-retirement benefits |
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid, the Company has no further payment obligations. |
The contributions are recognised as an expense in the Income Statement when they fall due. Amounts not paid are shown in accruals as a liability on the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds. |
Employee benefits |
Short-term employee benefits are recognised as an expense in the period in which they are incurred. |
In accordance with FRS 102, the company recognises the cost of any unused holiday entitlement in the period in which the employee's services are received. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
2023 | 2022 |
(Unaudited) |
£ | £ |
Europe |
United States of America |
Asia |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
(Unaudited) |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
(Unaudited) |
United Kingdom | 28 | 27 |
Canada | 47 | 43 |
2023 | 2022 |
(Unaudited) |
£ | £ |
Director's remuneration |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2023 | 2022 |
(Unaudited) |
£ | £ |
Other operating leases |
Depreciation - owned assets |
Profit on disposal of fixed assets | ( |
) |
Auditors' remuneration |
Foreign exchange differences | ( |
) | ( |
) |
Statutory interest |
Penalties |
6. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
(Unaudited) |
£ | £ |
Current tax: |
UK corporation tax |
Canadian taxes | 107,984 | 100,123 |
Total current tax |
Deferred tax |
Tax on profit |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
(Unaudited) |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Capital allowances in excess of depreciation | - | ( |
) |
Super deduction allowance | (5,023 | ) | - |
Prior year deferred tax charge at 25% | 78,293 | - |
Deferred tax movement at 5.51% | 90 | - |
Total tax charge | 640,332 | 500,473 |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
7. | DIVIDENDS |
2023 | 2022 |
(Unaudited) |
£ | £ |
Ordinary shares of £1 each |
Interim |
8. | TANGIBLE FIXED ASSETS |
Fixtures |
and | Computer |
fittings | equipment | Totals |
£ | £ | £ |
COST |
At 1 May 2022 |
Additions |
At 30 April 2023 |
DEPRECIATION |
At 1 May 2022 |
Charge for year |
At 30 April 2023 |
NET BOOK VALUE |
At 30 April 2023 |
At 30 April 2022 |
9. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
(Unaudited) |
£ | £ |
Trade debtors |
Other debtors |
Other taxation and social secu rity | 157,971 | - |
Directors' current accounts | 7,133 | 4,966 |
Prepayments & accrued income |
10. | CURRENT ASSET INVESTMENTS |
2023 | 2022 |
(Unaudited) |
£ | £ |
Fixed term deposits |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
11. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
(Unaudited) |
£ | £ |
Trade creditors |
Corporation tax |
Other creditors |
Other taxation and social secu rity | 41,046 | 57,236 |
Accrued expenses |
12. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
(Unaudited) |
£ | £ |
Within one year |
Between one and five years |
The total fixed lease payments recognised as an expense were £404,264 (2022: £370,093). |
13. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
(Unaudited) |
£ | £ |
Deferred tax | 78,705 | - |
Deferred |
tax |
£ |
Accelerated capital allowances | 78,705 |
Balance at 30 April 2023 |
14. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary | £1 | 100 | 100 |
SPRUNG STUDIOS LTD (REGISTERED NUMBER: 05420512) |
Notes to the Financial Statements - continued |
for the year ended 30 April 2023 |
15. | RESERVES |
Retained |
earnings |
£ |
At 1 May 2022 |
Profit for the year |
Dividends | ( |
) |
At 30 April 2023 |
16. | DIRECTOR'S ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to a director subsisted during the years ended 30 April 2023 and 30 April 2022: |
2023 | 2022 |
(Unaudited) |
£ | £ |
Balance outstanding at start of year |
Amounts advanced |
Amounts repaid | ( |
) | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year |
This loan is repayable on demand. Interest, where the loan exceeds £10,000, is charged at HMRC's official rate of interest of 2%. No interest was charged during the year (2022: £Nil). |
17. | ULTIMATE CONTROLLING PARTY |
Sprung Studios Ltd is a wholly owned subsidiary of Sprung Holdings Ltd, a company registered in Canada. The registered office is 937 Wentworth Avenue, North Vancouver, BC V7R 1R8. |
The Director of Sprung Holdings Ltd is James Chaytor, who is the sole director of Sprung Studios Ltd and is the ultimate controlling party. |