Company registration number SC358996 (Scotland)
NOVA INNOVATION LTD
FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022
PAGES FOR FILING WITH REGISTRAR
NOVA INNOVATION LTD
CONTENTS
Page
Balance sheet
1 - 2
Statement of changes in equity
Notes to the financial statements
3 - 10
NOVA INNOVATION LTD
BALANCE SHEET
AS AT 31 DECEMBER 2022
31 December 2022
- 1 -
31 December 2022
31 August 2021
as restated
Notes
£
£
£
£
Fixed assets
Intangible assets
3
14,756,216
10,652,078
Tangible assets
4
26,469
325,959
Investments
5
2,090
1,090
14,784,775
10,979,127
Current assets
Debtors
7
3,507,743
2,452,584
Cash at bank and in hand
2,906,856
1,590,657
6,414,599
4,043,241
Creditors: amounts falling due within one year
8
(1,258,785)
(1,623,069)
Net current assets
5,155,814
2,420,172
Total assets less current liabilities
19,940,589
13,399,299
Creditors: amounts falling due after more than one year
9
(385,431)
(935,858)
Provisions for liabilities
10
(162,000)
(162,000)
Deferred income
11
(68,231)
(2,974,375)
Net assets
19,324,927
9,327,066
Capital and reserves
Called up share capital
12
1,533
1,278
Share premium account
9,893,657
2,504,288
Profit and loss reserves
9,429,737
6,821,500
Total equity
19,324,927
9,327,066
The directors of the company have elected not to include a copy of the profit and loss account 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.
NOVA INNOVATION LTD
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
31 December 2022
- 2 -
The financial statements were approved by the board of directors and authorised for issue on 14 July 2023 and are signed on its behalf by:
Dr D S Forrest
Director
Company Registration No. SC358996
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 3 -
1
Accounting policies
Company information
Nova Innovation Ltd is a private company limited by shares incorporated in Scotland. The registered office is 45 Timber Bush, Edinburgh, EH6 6QH.
1.1
Reporting period
The profit and loss account presented reflects a 16 month period following a change in the accounting year end to better suit the business. The comparative profit and loss account reflects a 12 month period, as such the two periods are not entirely comparable.
1.2
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 £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received towards tidal turbine projects, including invoiced sales, including consulting income and charges to subsidiary companies, and grant income. Turnover is recognised at the point where the company obtains the right to consideration and is stated net of VAT.
Where the company recognises income from Research and Development Expenditure Credits (RDEC), it is classified as other income.
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
Development expenditure is written off as incurred, except where the Directors are satisfied as to the technical, commercial and financial viability of individual projects. In such cases the identifiable expenditure is deferred and amortised over the period during which the company is expected to benefit. As such, there is no amortisation included this year. Intangible assets are reviewed annually for any impairments and provisions are made for any such impairment.
Patents and trademarks are capitalised at cost.
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.
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 4 -
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:
Leasehold improvements
8% straight line
Plant and equipment
20% straight line
Fixtures and fittings
25% straight line
Computers
33% 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.
The carrying value of tangible assets are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.
1.7
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
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 balance sheet 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.
Debtors
Debtors with no stated interest rate and payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account.
Creditors
Creditors with no stated interest rate and payable within one year are recorded at transaction price.
All interest bearing loans and borrowings which are basic financial instruments are initially recognised at the present value of cash payable. After initial recognition they are measured at amortised cost.
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.
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 5 -
1.11
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 profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The 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 profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset 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
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.13
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.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
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.
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 6 -
1.16
Grants
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.
2
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2022
2021
Number
Number
Total
36
30
3
Intangible fixed assets
Other
£
Cost
At 1 September 2021
11,215,347
Additions
4,104,138
At 31 December 2022
15,319,485
Amortisation and impairment
At 1 September 2021 and 31 December 2022
563,269
Carrying amount
At 31 December 2022
14,756,216
At 31 August 2021
10,652,078
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 7 -
4
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 September 2021
10,101
1,934,261
1,944,362
Additions
21,192
21,192
At 31 December 2022
10,101
1,955,453
1,965,554
Depreciation and impairment
At 1 September 2021
3,773
1,614,630
1,618,403
Depreciation charged in the period
1,077
319,605
320,682
At 31 December 2022
4,850
1,934,235
1,939,085
Carrying amount
At 31 December 2022
5,251
21,218
26,469
At 31 August 2021
6,328
319,631
325,959
5
Fixed asset investments
2022
2021
£
£
Shares in group undertakings and participating interests
2,090
1,090
Movements in fixed asset investments
Shares in subsidiaries
£
Cost or valuation
At 1 September 2021
1,090
Additions
1,000
At 31 December 2022
2,090
Carrying amount
At 31 December 2022
2,090
At 31 August 2021
1,090
6
Subsidiaries
Details of the company's subsidiaries at 31 December 2022 are as follows:
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
6
Subsidiaries
(Continued)
- 8 -
Name of undertaking
Address
Nature of business
Class of
% Held
shares held
Direct
Nova Innovation CAN Ltd
1
Tidal turbine projects
Ordinary shares
100.00
Enlli Tidal Ltd
2
Dormant
Ordinary shares
100.00
Nova Innovation (Ireland) Ltd
3
Dormant
Ordinary shares
100.00
Oran Na Mara Ltd
4
Dormant
Ordinary shares
100.00
Yell Tidal Energy
4
Dormant
Ordinary shares
100.00
Registered office addresses (all UK unless otherwise indicated):
1
Conrad Dillon Robinson Law, 820-33 Alderney Drive, Dartmouth, Nova Scotia, B2Y 2N4
2
Menai Science Park, Gaerwen, Anglesey, LL60 6AG
3
Lewis and Co, 8 Priory Office Park, Stillorgan Road, Blackrock, Co Dublin
4
45 Timber Bush, Leith, Edinburgh, EH6 6QH
7
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
100,211
44,164
Corporation tax recoverable
376,979
515,179
Amounts owed by group undertakings
2,501,502
1,123,086
Other debtors
529,051
770,155
3,507,743
2,452,584
8
Creditors: amounts falling due within one year
2022
2021
£
£
Trade creditors
181,881
106,998
Taxation and social security
62,028
34,264
Other creditors
1,014,876
1,481,807
1,258,785
1,623,069
Included within other creditors is £256,954 (2021 - £256,954) of secured loan notes carrying an interest rate of 4.7% per annum. The company has granted securities over these loan notes in the form of a floating charge over the first three turbines in the Shetland Tidal Array and their associated assets to Scottish Enterprise.
9
Creditors: amounts falling due after more than one year
2022
2021
£
£
Other creditors
385,431
935,858
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
9
Creditors: amounts falling due after more than one year
(Continued)
- 9 -
Included within other creditors is £385,431 (2021 - £770,862) of secured loan notes carrying an interest rate of 4.7% per annum. The company has granted securities over these loan notes in the form of a floating charge over the first three turbines in the Shetland Tidal Array and their associated assets to Scottish Enterprise.
10
Provisions for liabilities
2022
2021
£
£
Decommissioning provision
162,000
162,000
Included within provisions are the costs of restoring the sea bed that the Tidal Array is situated on to its original state in the event of decommissioning.
11
Deferred income
2022
2021
£
£
Grant income
68,231
2,974,375
12
Called up share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £0.001 each
1,533,178
1,278,120
1,533
1,278
During the period there were various allotments of shares by which an additional 255,058 of Ordinary shares of £0.001 each were allotted at par. Consideration of £7,428,929 was received by the company for these shares, against which £39,305 of legal fees was offset.
13
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
£
£
111,675
161,508
14
Related party transactions
The directors are of the opinion that all related party transactions are conducted under normal market conditions and on an arm's length basis and therefore do not need to be disclosed under FRS 102 section 1A appendix C.
NOVA INNOVATION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 10 -
15
Prior period adjustment
Reconciliation of changes in equity
1 September
31 August
2020
2021
Notes
£
£
Adjustments to prior period
RDEC step 2 offset recognition 2020
1
185,259
185,259
R&D relief adjustment 2021
1
-
(110,394)
Total adjustments
185,259
74,865
Equity as previously reported
7,911,931
9,252,201
Equity as adjusted
8,097,190
9,327,066
Analysis of the effect upon equity
Profit and loss reserves
-
74,865
Reconciliation of changes in profit for the previous financial period
2021
Notes
£
Adjustments to prior period
RDEC step 2 offset recognition 2020
1
-
R&D relief adjustment 2021
1
(110,394)
Profit as previously reported
1,340,270
Profit as adjusted
1,229,876
Notes to reconciliation
1. Treatment of R&D tax reliefs
The directors have considered the accounting treatment previously applied to their RDEC step 2 offset amount and consider it appropriate to include this in the company's financial statements given its availability to be utilised against taxable profits. The company utilised £52,345 of the RDEC step 2 off set amount against taxable profits in the year ended 31 August 2021. An adjustment was also made to release net over provision of SME tax credits of £58,049 in the year ended 31 August 2021.
16
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:
Iain Binnie
Statutory Auditor:
Geoghegans
2022-12-312021-09-01false14 July 2023CCH SoftwareCCH Accounts Production 2023.100No description of principal activityThis audit opinion is unqualifiedDr D S ForrestDr G ConnorMr J MeagherMr O J G BontemsSir M C FallonMr C R L PhillipsMr B R AirdDr D S ForrestSC3589962021-09-012022-12-31SC3589962022-12-31SC3589962021-08-31SC358996core:IntangibleAssetsOtherThanGoodwill2022-12-31SC358996core:IntangibleAssetsOtherThanGoodwill2021-08-31SC358996core:LandBuildings2022-12-31SC358996core:OtherPropertyPlantEquipment2022-12-31SC358996core:LandBuildings2021-08-31SC358996core:OtherPropertyPlantEquipment2021-08-31SC358996core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-31SC358996core:CurrentFinancialInstrumentscore:WithinOneYear2021-08-31SC358996core:Non-currentFinancialInstrumentscore:AfterOneYear2022-12-31SC358996core:Non-currentFinancialInstrumentscore:AfterOneYear2021-08-31SC358996core:CurrentFinancialInstruments2022-12-31SC358996core:CurrentFinancialInstruments2021-08-31SC358996core:ShareCapital2022-12-31SC358996core:ShareCapital2021-08-31SC358996core:SharePremium2022-12-31SC358996core:SharePremium2021-08-31SC358996core:RetainedEarningsAccumulatedLosses2022-12-31SC358996core:RetainedEarningsAccumulatedLosses2021-08-31SC358996bus:CompanySecretaryDirector12021-09-012022-12-31SC358996core:IntangibleAssetsOtherThanGoodwill2021-09-012022-12-31SC358996core:LeaseholdImprovements2021-09-012022-12-31SC358996core:PlantMachinery2021-09-012022-12-31SC358996core:FurnitureFittings2021-09-012022-12-31SC358996core:ComputerEquipment2021-09-012022-12-31SC3589962020-09-012021-08-31SC358996core:IntangibleAssetsOtherThanGoodwill2021-08-31SC358996core:LandBuildings2021-08-31SC358996core:OtherPropertyPlantEquipment2021-08-31SC3589962021-08-31SC358996core:LandBuildings2021-09-012022-12-31SC358996core:OtherPropertyPlantEquipment2021-09-012022-12-31SC358996core:Subsidiary12021-09-012022-12-31SC358996core:Subsidiary22021-09-012022-12-31SC358996core:Subsidiary32021-09-012022-12-31SC358996core:Subsidiary42021-09-012022-12-31SC358996core:Subsidiary52021-09-012022-12-31SC358996core:Subsidiary112021-09-012022-12-31SC358996core:Subsidiary222021-09-012022-12-31SC358996core:Subsidiary332021-09-012022-12-31SC358996core:Subsidiary442021-09-012022-12-31SC358996core:Subsidiary552021-09-012022-12-31SC358996core:WithinOneYear2022-12-31SC358996core:WithinOneYear2021-08-31SC358996core:Non-currentFinancialInstruments2022-12-31SC358996core:Non-currentFinancialInstruments2021-08-31SC358996bus:PrivateLimitedCompanyLtd2021-09-012022-12-31SC358996bus:SmallCompaniesRegimeForAccounts2021-09-012022-12-31SC358996bus:FRS1022021-09-012022-12-31SC358996bus:Audited2021-09-012022-12-31SC358996bus:Director12021-09-012022-12-31SC358996bus:Director22021-09-012022-12-31SC358996bus:Director32021-09-012022-12-31SC358996bus:Director42021-09-012022-12-31SC358996bus:Director52021-09-012022-12-31SC358996bus:Director62021-09-012022-12-31SC358996bus:Director72021-09-012022-12-31SC358996bus:CompanySecretary12021-09-012022-12-31SC358996bus:FullAccounts2021-09-012022-12-31xbrli:purexbrli:sharesiso4217:GBP