Company registration number 06738633 (England and Wales)
PDL FINANCE LIMITED T/A MR LENDER
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
PDL FINANCE LIMITED T/A MR LENDER
COMPANY INFORMATION
Directors
A Freeman
E Nisbet
J Grant
D Shrier
Company number
06738633
Registered office
30 City Road
London
EC1Y 2AB
Auditor
Gravita ABG LLP
30 City Road
London
EC1Y 2AB
PDL FINANCE LIMITED T/A MR LENDER
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Notes to the financial statements
11 - 21
PDL FINANCE LIMITED T/A MR LENDER
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
- 1 -
The directors present the strategic report for the year ended 31 December 2021.
Principal Activities and Business Review
The principal activity of the company is the provision of short-term loans.
Fair review of the business
The directors were pleased with the performance in 2021. In the early months the main focus was to continue to sustain the business through the Covid19 pandemic and in the latter part of the year transition back to normal operations, with minimal impact to the service levels to consumers and risks to the business.
In 2021 shows:
The 2021 financial results are in line with the directors expectations.
Financial Risk Management, Objectives and Policies
The company is exposed to a moderate level of price, credit, liquidity and cash flow risks. The company manages these risks by financing its operations through retained profits supplemented by borrowing where necessary to fund expansion or capital expenditure programmes.
The management objective is to retain sufficient liquid funds via retained earnings, thus enabling the company to meet its day to day funding requirements, whilst minimising the risk of fluctuating interest rates on external borrowings.
The company makes little use of financial instruments other than an operational bank account and the facility to loan from its parent company SDJ Enterprise Limited if required, therefore its exposure to price, credit, liquidity and cash flow risk is not material for the assessment of assets, liabilities, financial position and profit and loss of the company.
Regulatory, Political and Legal Risk Management and Policies
The company is regulated by the FCA, therefore has a high level of exposure to potential regulatory, political and legal risks.
If the company fail to comply with any laws, regulations, rules or codes relating to the consumer credit industry it could potentially be fined by the FCA or expose the company to negative publicity which would in turn have a negative impact on the business.
Controls, systems and processes have been developed to manage these risks. These include monitoring regulatory and legal changes, developing appropriate compliance policies, monitoring adherence to these policies and reporting accordingly, as well as regular monitored compliance training for all employees.
Going Concern
The company’s cash requirements for the next twelve months are adequately resourced to
continue their operations and to meet all liabilities.
PDL FINANCE LIMITED T/A MR LENDER
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 2 -
Future Development
The global COVID19 pandemic continued to govern the business operations in the early party of the year, however since the government restrictions have been lifted the business has made a smooth transition to operate normally and slowly implement the growth strategy that was placed on hold during the pandemic.
PDL are constantly innovating on technology and have developed all of their code that is used to run and manage the Loan Management System. The development team continues to advance and adapt the current platform and systems.
A Freeman
Director
21 December 2022
PDL FINANCE LIMITED T/A MR LENDER
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2021.
Principal activities
The principal activity of the company continued to be the provision of short term loans.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
A Freeman
E Nisbet
J Grant
D Shrier
Results and dividends
The results for the year are set out on page 8.
No final dividend has been recommended.
Research and development
The company continues to invest in the development of its website and software. The directors regard the investment in research and development as integral to the continuing success of the business and ensuring customers' needs and requirements as well as internal reporting needs are met.
Future developments
The company seeks continued growth through both marketing and enhanced service offering.
Statement of directors' responsibilities
The directors are responsible for preparing the annual 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.
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.
PDL FINANCE LIMITED T/A MR LENDER
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 4 -
Auditors
On 16 November 2022 our auditors changed their name to Gravita ABG LLP.
On behalf of the board
A Freeman
Director
21 December 2022
PDL FINANCE LIMITED T/A MR LENDER
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PDL FINANCE LIMITED T/A MR LENDER
- 5 -
Opinion
We have audited the financial statements of PDL Finance Limited t/a Mr Lender (the 'company') for the year ended 31 December 2021 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity 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 December 2021 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.
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.
However, because not all future events or conditions can be predicted this statement is not a guarantee as to the company's ability to continue as a going concern.
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.
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'
r
eport 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.
PDL FINANCE LIMITED T/A MR LENDER
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PDL FINANCE LIMITED T/A MR LENDER
- 6 -
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 identifie
d
material misstatements in the strategic report or the directors'
r
eport
.
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'
r
esponsibilities
s
tatement, 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
.
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
. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
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 of the sector in which the company 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 company, including, but not limited to, the Companies Act 2006, FCA legislation and relevant taxation legislation;
-
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; 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.
PDL FINANCE LIMITED T/A MR LENDER
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PDL FINANCE LIMITED T/A MR LENDER
- 7 -
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
-
understanding the business model as part of the control and business environment;
-
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;
-
reading the minutes of meetings of those charged with governance;
-
enquiring of management as to actual and potential litigation and claims; and
-
reviewing correspondence with HMRC, and enquiring with management if actual and potential non-compliance with laws and regulations.
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 by for example forgery, or intentional misrepresentation or through collusion.
Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.
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.
Sarah Wilson FCA (Senior Statutory Auditor)
For and on behalf of Gravita ABG LLP
22 December 2022
Chartered Accountants
Statutory Auditor
30 City Road
London
EC1Y 2AB
PDL FINANCE LIMITED T/A MR LENDER
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021
- 8 -
2021
2020
Notes
£
£
Turnover
3
12,813,031
13,478,430
Cost of sales
(747,646)
(699,530)
Gross profit
12,065,385
12,778,900
Administrative expenses
(12,140,345)
(13,309,735)
Other operating income
270,231
194,546
Operating profit/(loss)
4
195,271
(336,289)
Interest payable and similar expenses
7
(2,822)
(55,482)
Exceptional item
8
(7,444)
(1,747,050)
Profit/(loss) before taxation
185,005
(2,138,821)
Tax on profit/(loss)
9
126,022
283,287
Profit/(loss) for the financial year
311,027
(1,855,534)
The Statement Of Comprehensive Income has been prepared on the basis that all operations are continuing operations.
PDL FINANCE LIMITED T/A MR LENDER
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2021
31 December 2021
- 9 -
2021
2020
Notes
£
£
£
£
Fixed assets
Intangible assets
11
8,024
8,024
Tangible assets
12
138,363
199,156
146,387
207,180
Current assets
Debtors
13
9,335,673
6,841,218
Cash at bank and in hand
2,301,058
6,703,502
11,636,731
13,544,720
Creditors: amounts falling due within one year
14
(885,810)
(2,665,619)
Net current assets
10,750,921
10,879,101
Net assets
10,897,308
11,086,281
Capital and reserves
Called up share capital
16
2,250
2,250
Share premium account
17
1,701,727
1,701,727
Profit and loss reserves
9,193,331
9,382,304
Total equity
10,897,308
11,086,281
The financial statements were approved by the board of directors and authorised for issue on 21 December 2022 and are signed on its behalf by:
A Freeman
Director
Company Registration No. 06738633
PDL FINANCE LIMITED T/A MR LENDER
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
- 10 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2020
2,250
1,701,727
11,237,838
12,941,815
Year ended 31 December 2020:
Loss and total comprehensive income for the year
-
-
(1,855,534)
(1,855,534)
Balance at 31 December 2020
2,250
1,701,727
9,382,304
11,086,281
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
311,027
311,027
Dividends
10
-
-
(500,000)
(500,000)
Balance at 31 December 2021
2,250
1,701,727
9,193,331
10,897,308
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
- 11 -
1
Accounting policies
Company information
PDL Finance Limited t/a Mr Lender is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
30 City Road, London, EC1Y 2AB. The principal place of business is
Suite 105W, Sterling House, Langston Road
, Loughton, Essex, IG10 9EW.
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 a
mounts
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.
This 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
.
T
he company has
therefore
taken advantage of
e
xemptions from the following disclosure requirements:
-
Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares
;
-
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash
f
low and related notes and disclosures
;
-
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; 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 33 ‘Related Party Disclosures’ – Compensation for key management personnel
.
The financial statements of the company are consolidated in the financial statements of
SDJ Enterprises Limited
. These consolidated financial statements are available from its registered office,
2nd Floor Ashdon House, Moon Lane, Barnet. Herts, EN5 5YL
.
1.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
The turnover shown in the profit and loss account represents interest receivable on short term loans made during the period and amounts invoiced to affiliates on the sale of debts and customer leads. Turnover is recognised on an accruals basis.
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 12 -
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Website design and build
3 years on a straight line basis
Trademark
10 years on a straight line basis
1.5
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 recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Fixtures, fittings & equipment
33.3% on a straight line basis
Computer equipment
33.3% on a straight line basis
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
.
1.6
Impairment of fixed assets
At each reporting
period
end date, the
company
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.
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.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand, deposits held at call with banks
.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ 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
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.
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 13 -
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.
Impairment of financial assets
Financial assets 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
paymen
ts 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. A
m
ounts 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.
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 14 -
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
s
ubsequently 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 th
r
ough 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.9
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.
1.10
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. Deferred tax is charged or credited in the
income statement
, 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 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.
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 15 -
1.11
Employee benefits
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease
.
1.14
Government grants
Government grant represents the fair value of the income received or receivable from the furlough scheme introduced by the UK government due to the pandemic caused by COVID-19.
Income from the furlough scheme is recognised in the period the furlough income relates to and recorded as ‘grant income’.
1.15
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 are included in the
statement of comprehensive income
for the period.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make 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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are
as follows.
Loan capital written off
Loan capital is written off a set number of days after the missed due date. It is assumed that if a customer has not paid
by
this time the amount owing is unlikely to be paid. The directors review this in detail on a regular basis to ensure that it reasonably reflects the practical recoverability of loan capital issued.
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 16 -
3
Turnover and other revenue
2021
2020
£
£
Turnover analysed by class of business
Interest income on short term loans
12,059,878
12,782,014
Sale of debts and leads
753,153
696,416
12,813,031
13,478,430
2021
2020
£
£
Other revenue
Grants received
270,231
194,546
4
Operating profit/(loss)
2021
2020
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Exchange losses
2,301
18,981
Government grants
(270,231)
(194,546)
Fees payable to the company's auditor for the audit of the company's financial statements
51,050
66,758
Depreciation of owned tangible fixed assets
111,866
106,579
Operating lease charges
448,768
425,707
Grants received are in respect of claims under the Coronavirus Job Retention Scheme.
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2021
2020
Operations
76
108
Administrative
32
29
108
137
Their aggregate remuneration comprised:
2021
2020
£
£
Wages and salaries
4,136,215
4,712,739
Social security costs
441,791
490,033
Pension costs
56,835
65,883
4,634,841
5,268,655
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 17 -
6
Directors' remuneration
2021
2020
£
£
Remuneration for qualifying services
1,320,558
1,114,132
Company pension contributions to defined contribution schemes
5,275
5,240
1,325,833
1,119,372
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2020 - 4).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2021
2020
£
£
Remuneration for qualifying services
484,245
419,528
Company pension contributions to defined contribution schemes
1,310
1,310
7
Interest payable and similar expenses
2021
2020
£
£
Interest payable to group undertakings
2,822
55,482
8
Exceptional item
In 2019, the FCA carried out a review of the HCC and HCSTC sector. This review encompassed all lenders and was not specific to PDL Finance Limited. The review was finalised in 2020 and led to policy updates and customer redress which was satisfied by way of discounts or refunds. The total liability of £1.7m has been recognised in the profit and loss account in 2020 as an exceptional item. The liability was settled by May 2021. The £7,444 included in the accounts as an exceptional item relates to claims made after the deadline which the company intends to pay out.
9
Taxation
2021
2020
£
£
Current tax
UK corporation tax on profits for the current period
61,419
Adjustments in respect of prior periods
(187,441)
(283,287)
Total current tax
(126,022)
(283,287)
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
9
Taxation
(Continued)
- 18 -
The actual credit for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
2021
2020
£
£
Profit/(loss) before taxation
185,005
(2,138,821)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2020: 19.00%)
35,151
(406,376)
Tax effect of expenses that are not deductible in determining taxable profit
38,710
116,421
Adjustments in respect of prior years
(187,441)
(283,287)
Capital allowances in excess of depreciation
(12,442)
(17,845)
Tax losses carried back
307,800
Taxation credit for the year
(126,022)
(283,287)
10
Dividends
2021
2020
£
£
Final paid
500,000
11
Intangible fixed assets
Website design and build
Trademark
Total
£
£
£
Cost
At 1 January 2021 and 31 December 2021
246,446
8,024
254,470
Amortisation and impairment
At 1 January 2021 and 31 December 2021
246,446
246,446
Carrying amount
At 31 December 2021
8,024
8,024
At 31 December 2020
8,024
8,024
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 19 -
12
Tangible fixed assets
Fixtures, fittings & equipment
Computer equipment
Total
£
£
£
Cost
At 1 January 2021
631,795
532,830
1,164,625
Additions
32,816
18,257
51,073
At 31 December 2021
664,611
551,087
1,215,698
Depreciation and impairment
At 1 January 2021
507,450
458,019
965,469
Depreciation charged in the year
69,136
42,730
111,866
At 31 December 2021
576,586
500,749
1,077,335
Carrying amount
At 31 December 2021
88,025
50,338
138,363
At 31 December 2020
124,345
74,811
199,156
13
Debtors
2021
2020
Amounts falling due within one year:
£
£
Trade debtors
6,041,323
4,163,106
Unpaid share capital
1,500,000
1,500,000
Corporation tax recoverable
283,287
283,287
Other debtors
323,554
36,247
Prepayments and accrued income
1,187,509
858,578
9,335,673
6,841,218
14
Creditors: amounts falling due within one year
2021
2020
£
£
Trade creditors
277,257
281,050
Amounts owed to group undertakings
176,278
Corporation tax
69,191
195,213
Other taxation and social security
268,874
128,689
Other creditors
6,282
1,146,315
Accruals and deferred income
264,206
738,074
885,810
2,665,619
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 20 -
15
Retirement benefit schemes
2021
2020
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
56,835
65,883
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
16
Share capital
2021
2020
2021
2020
Ordinary share capital
Number
Number
£
£
Issued and not fully paid
Ordinary A of £1 each
500
500
500
500
Ordinary B of £1 each
1,500
1,500
1,500
1,500
Ordinary C of £1 each
250
250
250
250
2,250
2,250
2,250
2,250
All classes of shares have full rights in respect of voting, dividend and capital distribution (including on winding up). None of the classes of shares confers any right of redemption.
On 14 March 2018 the company issued 250 Ordinary C Shares of £1 each at £6,000 per share. This remains unpaid.
17
Share premium account
Consideration received for shares issued above their nominal value net of transaction costs.
18
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2021
2020
£
£
Within one year
493,800
442,241
Between two and five years
1,975,200
1,975,200
In over five years
1,332,584
1,975,200
3,801,584
4,392,641
PDL FINANCE LIMITED T/A MR LENDER
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 21 -
19
Related party transactions
During the year
,
the company
repaid £176,278 (2020: £534,206) on the loan provided by it's parent company.
Interest
is charged at 12% and
£
2,822
(20
20
: £
55,482
) in
interest
was
charged and
paid
in the year
.
At the year end, the company owed
£
nil
(20
20
: £
176,278
) to its parent
company, all of which is unsecured.
During the year, the company paid
£
132,721
(20
20
: £
175,912
) to entities in which the directors of the parent entity have an interest
for purchases made
. At the balance sheet date, the company owed £
22,459
(20
20
:
£33,084
) to these entities
and was owed £289,529 (2020: £36,208) by these entities
.
During the year, the company made donations of £4,334 (2020: £6,592) to Lenderhand, a charity in which two of the directors are trustees.
During the year, the company paid the following dividends;
• £
141,111
(20
20
: £
nil
) to directors and entities in which directors have an interest.
• £
358,889
(20
20
: £
nil)
to the parent company, SDJ Enterprises Limited.
20
Ultimate controlling party
The immediate and ultimate parent company is SDJ Enterprises Limited,
whose registered office is Ashdon House, Second Floor, Moon Lane, Barnet, EN5 5YL.
T
he smallest and largest group for which consolidated accounts including the company are prepared is the one headed by SDJ Enterprises Limited; these accounts are available from
the registered office.
2021-12-31
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