Company Registration No. 07630238 (England and Wales)
Prezola Limited
Financial statements
for the year ended 31 December 2022
Pages for filing with the registrar
Prezola Limited
Contents
Page
Statement of financial position
1
Statement of changes in equity
2
Notes to the financial statements
3 - 12
Prezola Limited
Statement of financial position
As at 31 December 2022
Page 1
2022
2021
Notes
£
£
£
£
Fixed assets
Intangible assets
5
63,414
126,699
Tangible assets
6
7,316
19,656
70,730
146,355
Current assets
Debtors - deferred tax
110,820
1,044,321
Debtors - other
7
115,679
1,961,971
Cash at bank and in hand
1,476,715
314,743
1,703,214
3,321,035
Creditors: amounts falling due within one year
8
(10,187,197)
(8,341,912)
Net current liabilities
(8,483,983)
(5,020,877)
Net liabilities
(8,413,253)
(4,874,522)
Capital and reserves
Called up share capital
313
313
Share premium account
3,144,878
3,144,878
Profit and loss reserves
(11,558,444)
(8,019,713)
Total equity
(8,413,253)
(4,874,522)
The directors of the company have elected not to include a copy of the income statement within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 11 July 2023 and are signed on its behalf by:
Pru Leary
Director
Company Registration No. 07630238 (England and Wales)
Prezola Limited
Statement of changes in equity
For the year ended 31 December 2022
Page 2
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2021
313
3,144,878
(7,322,524)
(4,177,333)
Year ended 31 December 2021:
Loss and total comprehensive income for the year
-
-
(697,189)
(697,189)
Balance at 31 December 2021
313
3,144,878
(8,019,713)
(4,874,522)
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
-
(3,538,731)
(3,538,731)
Balance at 31 December 2022
313
3,144,878
(11,558,444)
(8,413,253)
Prezola Limited
Notes to the financial statements
For the year ended 31 December 2022
Page 3
1
Accounting policies
Company information
Prezola Limited is a private company limited by shares incorporated in England and Wales. The registered office is 80-82 Glentham Road, Barnes, London, SW13 9JJ.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £1.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The Castelnau Group believe in the long term potential of the Group and remain committed to providing support for the business working capital and have therefore agreed to make a £7.5m facility available to the group with 0% interest and no convertible option.
As a conclusion we are confident that the company will continue to operate in the foreseeable future. The businesses have collectively grown consistently over the last 5 years, COVID19 aside, and the Directors believe that this growth will continue. However, there is always the threat of new entrants that can take away some of the growth or market share. The Directors monitor the competitive landscape.
Consequently the directors continue to adopt the going concern basis of account in preparing the financial statements and believe there is sufficient liquidity and support available in the Group to continue to grow the business into profitability.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
1
Accounting policies (continued)
Page 4
1.3
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discount.
Sales of goods and services are recognised as revenue at the point that the sales order has been finalised and ownership passes to the recipient.
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
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.
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
3 years straight line
1.6
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
3 - 6 years straight line
Motor vehicles
6 years straight line
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.
1.7
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).
1.8
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
1
Accounting policies (continued)
Page 5
1.9
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.
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.
1.10
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.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
1
Accounting policies (continued)
Page 6
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.
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
1
Accounting policies (continued)
Page 7
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the asset's fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to the income statement so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.15
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.16
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.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
Page 8
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.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The directors do not believe there are any critical accounting judgements or key sources of estimation uncertainty.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Deferred tax assets
A deferred tax asset is recognised when it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Recognition, therefore involves judgement regarding the forecasting of future taxable profits of the business. At the balance sheet date, gross tax losses of £4.2 million have been recognised based on the expectation that these will be utilised over the next five years.
3
Employees
The average monthly number of persons employed by the company during the year was:
2022
2021
Number
Number
Total
9
18
During the year Prezola reallocated the payroll function to another group company. This has caused a reduction in the contracted employee numbers in the year.
4
Directors' remuneration
Directors are now remunerated through other group companies.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
Page 9
5
Intangible fixed assets
Website
£
Cost
At 1 January 2022
1,584,806
Additions
44,110
At 31 December 2022
1,628,916
Amortisation and impairment
At 1 January 2022
1,458,107
Amortisation charged for the year
107,395
At 31 December 2022
1,565,502
Carrying amount
At 31 December 2022
63,414
At 31 December 2021
126,699
6
Tangible fixed assets
Fixtures, fittings & equipment
£
Cost
At 1 January 2022
104,499
Disposals
(49,835)
At 31 December 2022
54,664
Depreciation and impairment
At 1 January 2022
84,843
Depreciation charged in the year
12,340
Eliminated in respect of disposals
(49,835)
At 31 December 2022
47,348
Carrying amount
At 31 December 2022
7,316
At 31 December 2021
19,656
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
6
Tangible fixed assets (continued)
Page 10
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2022
2021
£
£
Plant, machinery & motor vehicles
7,881
Depreciation charge for the year in respect of leased assets
-
8,106
7
Debtors
2022
2021
Amounts falling due within one year:
£
£
Amounts owed by group undertakings
35,517
1,028,091
Other debtors
80,162
933,880
115,679
1,961,971
Deferred tax asset
110,820
1,044,321
226,499
3,006,292
8
Creditors: amounts falling due within one year
2022
2021
£
£
Bank loans
600,000
Trade creditors
70,408
Amounts owed to group undertakings
7,801,652
5,227,686
Taxation and social security
23,733
46,515
Other creditors
2,291,404
2,467,711
10,187,197
8,341,912
Included in other creditors are hire purchase liabilities of £nil (2021: £1,561) which are secured on the assets to which they relate.
Prezola Limited is a member of a VAT group of which its fellow group company, Cambium Operations Limited, is the representative member. Cambium Operations Limited allocates its VAT liability out to the group members based on trade over the previous quarter.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
Page 11
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Senior Statutory Auditor:
Neil Davies
Statutory Auditors:
Saffery Champness LLP
10
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2022
2021
£
£
Total
1,551
11
Related party transactions
Transactions with related parties
During the year, the company provided a revolving facility to Phoenix UK Fund Limited, a fellow group company, at an interest rate of 15%. At the year end the company was owed £nil (2021: £700,000) from Phoenix UK Fund Limited and £62,919 (2021: £42,328) interest income has been recognised.
The company has taken advantage of the exemption under paragraph 33.1a of FRS 102 from disclosing transactions entered into between two or more members of a group, where any subsidiary undertaking which is a party to the transaction is wholly owned by a member of that group.
The company has also taken advantage of the exemption under paragraph 1AC.35 of FRS 102 from disclosing transactions with related parties that have been carried out on an arm's length basis.
Prezola Limited
Notes to the financial statements (continued)
For the year ended 31 December 2022
Page 12
12
Parent company
The parent company of Prezola Limited is The Cambium Group UK Holdings Limited (formerly WLS Holdings Limited) and its registered office is 80-82 Glentham Road, London, United Kingdom, SW13 9JJ. Consolidated accounts are produced by the parent company which are available from Companies House.
The ultimate parent company is WLS International Limited, a company registered in Cayman Islands.
2022-12-312022-01-01false2023-07-11CCH SoftwareCCH Accounts Production 2022.300No description of principal activityThis audit opinion is unqualifiedAnne-Marie JenkinsPru Leary2023-07-11076302382022-01-012022-12-31076302382022-12-31076302382021-12-3107630238core:ComputerSoftware2022-12-3107630238core:ComputerSoftware2021-12-3107630238core:FurnitureFittings2022-12-3107630238core:FurnitureFittings2021-12-3107630238core:WithinOneYear2022-12-3107630238core:WithinOneYear2021-12-3107630238core:Non-currentFinancialInstruments2022-12-3107630238core:Non-currentFinancialInstruments2021-12-3107630238core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-3107630238core:CurrentFinancialInstrumentscore:WithinOneYear2021-12-3107630238core:CurrentFinancialInstruments2022-12-3107630238core:CurrentFinancialInstruments2021-12-3107630238core:ShareCapital2022-12-3107630238core:ShareCapital2021-12-3107630238core:SharePremium2022-12-3107630238core:SharePremium2021-12-3107630238core:RetainedEarningsAccumulatedLosses2022-12-3107630238core:RetainedEarningsAccumulatedLosses2021-12-3107630238core:ShareCapital2020-12-3107630238core:SharePremium2020-12-3107630238core:RetainedEarningsAccumulatedLosses2020-12-3107630238bus:CompanySecretaryDirector12022-01-012022-12-3107630238core:RetainedEarningsAccumulatedLosses2021-01-012021-12-31076302382021-01-012021-12-3107630238core:RetainedEarningsAccumulatedLosses2022-01-012022-12-3107630238core:IntangibleAssetsOtherThanGoodwill2022-01-012022-12-3107630238core:ComputerSoftware2022-01-012022-12-3107630238core:FurnitureFittings2022-01-012022-12-3107630238core:ComputerEquipment2022-01-012022-12-3107630238core:ComputerSoftware2021-12-3107630238core:ComputerSoftwarecore:ExternallyAcquiredIntangibleAssets2022-01-012022-12-3107630238core:FurnitureFittings2021-12-3107630238bus:PrivateLimitedCompanyLtd2022-01-012022-12-3107630238bus:SmallCompaniesRegimeForAccounts2022-01-012022-12-3107630238bus:FRS1022022-01-012022-12-3107630238bus:Audited2022-01-012022-12-3107630238bus:Director22022-01-012022-12-3107630238bus:FullAccounts2022-01-012022-12-31xbrli:purexbrli:sharesiso4217:GBP