STIRLING_SQUARE_CAPITAL_P - Accounts

The members present their report and financial statements of Stirling Square Capital Partners LLP (the "LLP") for the year ended 31 December 2019.

The principal activity of the LLP continues to be the provision of investment advice.

The profit for the year available for distribution to members was £5,311,112 (2018: £4,133,717).

The LLP is exposed to financial risk through its assets and liabilities. Due to the LLP's business and the assets and liabilities contained in the LLP's balance sheet, the only financial risks that the members consider relevant are currency risk, liquidity risk and cash flow risk.

Currency risk is mitigated by the LLP through the holding of cash in the respective currencies of the LLP's underlying obligations. Liquidity and cash flow risk are mitigated by the LLP through the regular reviewing of its current and future liquidity and cash flow requirements. The LLP has contractual agreements with its main customers, which are related entities with which it has close working relationships that enables it to draw down advisory fees as they are earned.

The following designated members have held office since 1 January 2019:

Each of the members in office at the date of approval of this annual report confirms that:

•     so far as the members are aware, there is no relevant audit information of which the LLP's auditor is unaware; and

•     the members have taken all the steps that they ought to have taken as members in order to make themselves aware of any relevant audit information and to establish that the LLP's auditor is aware of that information.

The members are responsible for preparing the financial statements in accordance with applicable law and regulations.

Company law (as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with UK Accounting Standards and applicable law (Financial Reporting Standard 102 Section 1A - Small Entities).

Under company law (as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members 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 LLP and of the profit or loss of the LLP for that year. In preparing those financial statements, the members are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and estimates that are reasonable and prudent;

• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the LLP will continue in business.

The members are responsible for keeping adequate accounting records that are sufficient to show and explain the LLP's transactions and disclose with reasonable accuracy at any time the financial position of the LLP and to enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the LLP and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The members of the limited liability partnership have elected not to include a copy of the profit and loss account within the financial statements.

These financial statements have been prepared and delivered in accordance with the provisions applicable to limited liability partnerships subject to the small limited liability partnerships regime.

These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in July 2014, together 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 have also been prepared in accordance with the provisions applicable to limited liability partnerships subject to the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008 and in accordance with the provision of Financial Reporting Standard 102 Section 1A - Small Entities.

The financial statements are prepared in sterling, which is the functional and presentational currency of the LLP. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared on the historical cost convention. The principal accounting policies adopted are set out below.

The members regularly review cash flow forecasts to determine the cash requirements of the LLP and have a reasonable expectation that the LLP will have adequate resources to continue in operational existence for the foreseeable future, being a period of at least twelve months from the date of this report.

The members continue to monitor the impact of COVID-19 and potential implications on future operations. The members have performed rigorous stress testing to fully test the potential impact on the business and remain satisfied that the LLP is able to meet its liabilities as they fall due over the next 12 months.

Thus the members have adopted the going concern basis in preparing these financial statements.

The turnover shown in the Profit and Loss Account represents amounts earned during the year, in respect of the provision of investment advice, exclusive of Value Added Tax.

All tangible fixed assets are initially recorded at cost.

Depreciation is calculated so as to write off the cost of an asset less its estimated residual value, over the useful economic life of that asset as follows:

Equipment         - 20% straight line

Fixtures and Fittings    - 20% straight line

The LLP 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 are recognised in the LLP's Balance Sheet when the LLP becomes party to the contractual provisions of the instrument. Basic financial assets, which include amounts owed from undertakings, other receivables 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, less any impairment.

Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.

Financial liabilities, including amounts owed to affiliated undertakings and other creditors, are initially measured at transaction price. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method, except for short-term payables when the recognition of interest would be immaterial.

The LLP operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the LLP. The annual contributions payable are charged to the Profit and Loss Account.

Rentals under operating leases are charged on a straight-line basis over the term of the lease.

Cash flow statement

The members have taken advantage of the exemption in Financial Reporting Standard Section 1A (Para 1A.7) from including a cash flow statement in the financial statements on the grounds that the LLP is small.

Tax provisions

The taxation payable on profits is the personal liability of the members during the year.

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 using the average rate for the period. Exchange differences are taken to the Profit and Loss Account in arriving at operating profit.

In the opinion of the members, there are no significant estimates or judgements included in these financial statements.

An analysis of the LLP's turnover is as follows:

The average number of persons (excluding members) employed by the LLP during the year was:

Staff costs during the year were as follows:

The LLP operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the LLP in an independently administered fund.

The charge to profit or loss in respect of defined contribution schemes was £118,784 (2018: £102,976).

At 31 December 2019, the LLP was committed to making payments totalling £1,048,860 (2018: £1,048,860) under non-cancellable operating leases in the year to 31 December 2020.

In the event of a winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors.

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.

The Partnership acts as a joint guarantor over Stirling Square Capital Partners Second Fund (Scotland) Limited Partnership and Stirling Square Capital Partners Third Fund (Jersey) Separate Limited Partnership's bridging loans with Investec in the event that the respective entities cannot meet the liabilities as and when they fall due. The maximum liability that may be incurred by the Partnership is capped at the level of funds available in the current bank account of each guarantor.

During the year, the LLP provided advisory services with a value of £628,936 (2018: £370,120) to Stirling Square Capital Partners Second Fund Advisers Limited ("SSCP Second Fund Advisers"), a related company registered in Jersey in which some of the members of the LLP have an interest. At 31 December 2019, the balance owed to SSCP Second Fund Advisers was £nil (2018: £nil).

During the year, the LLP provided advisory services with a value of £4,026,607 (2018: £4,496,014) to Stirling Square Capital Partners Third Fund Advisers Limited ("SSCP Third Fund Advisers"), a related company registered in Jersey in which some of the members of the LLP have an interest. At 31 December 2019, the balance owed to SSCP Third Fund Advisers was £1,063,024 (2018: £963,345).

During the year, the LLP provided advisory services with a value of £2,798,414 (2018: £1,622,059) to Stirling Square Capital Partners (Advisers) LLP ("SSCP (Advisers) LLP"), a related partnership registered in Jersey in which some of the members of the LLP have an interest. At 31 December 2019, the balance owed from SSCP (Advisers) LLP was £nil (2018: £nil).

During the year, the LLP provided advisory services with a value of £4,323,880 (2018: £3,434,602) to Stirling Square Capital Partners Jersey AIFM Limited ("SSCP Jersey AIFM Limited"), a related company registered in Jersey in which some of the members of the LLP have an interest. At 31 December 2019, the balance owed from SSCP Jersey AIFM Limited was £nil (2018: £nil).

During the year, the LLP incurred £1,824 (2018: £1,998) of costs from Stirling Square Capital Partners Services Limited ("SSCP Services"), a company registered in England and Wales and of which the LLP is a corporate director. At 31 December 2019, the balance owed by SSCP Services was £4,604 (2018: £4,740).