ACCOUNTS - Final Accounts preparation
ACCOUNTS - Final Accounts preparation
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FOR THE YEAR ENDED 31 DECEMBER 2021
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FILMS @ 59 HOLDINGS LIMITED
COMPANY INFORMATION
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FILMS @ 59 HOLDINGS LIMITED
CONTENTS
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FILMS @ 59 HOLDINGS LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
The purpose of this report is to provide an analysis of the Group and company's past performance and to provide insight into the Group's main objectives, strategies, future prospects, the principal risks it faces moving forward and to provide information to assess how the directors have performed their duty to promote the success of the Group.
Films at 59 Holdings Limited was incorporated in April 2020, and became active in February 2021, to act as a vehicle for the establishment of an Employee Management Incentive (EMI) scheme, and to transfer controlling interest in the group to an Employee Benefit Trust (EBT). The Trust is in place to manage the company for the benefit of all current and future employees.
Films at 59 is an award winning media support company based in the Bristol, UK. The company has gained both national and international recognition for its work in a variety of genres, but always in partnership with other businesses both within our region and beyond. We are fiercely proud of our Bristol heritage and the creative city we live and work within, and have always strived to work collaboratively to bring success not only to ourselves, but to the city and region as a whole.
Our Business Model and Company Philosophy
We provide end-to-end solutions: crews, location equipment hire, workflow consultancy, post-production finishing and completed programme quality assurance and delivery. In our ever-growing and over-crowded world of media content creation, we know that our clients require flexibility, responsiveness, creative flair and budgetary “peace of mind”. We strive to meet and exceed their expectations with every project we work on.
Our company mission statement is this: “By delivering personal, flexible and innovative solutions, we enable our clients to achieve their ambitions, creatively and within budget. We are committed to being a sustainable business which treats everybody with respect.”
It is thanks to the hard work, talent and commitment of all of our staff that we are able to achieve success and continually rank amongst the top 15 post-production houses in the nation. We have been nominated multiple times for the industry recognised Broadcast Magazine ‘Best Post Production Facility’ award, and were immensely proud to finally bring this home to Bristol and the South West in early 2018.
Our Strategy
The Group has a strong management team with excellent commercial, technical and financial skills and entrepreneurial flair. We appreciate our creative, operational and support talent who commit fully to our clients and their projects. This customer-focused work ethic across all activities has, over the long term, built trust and an enviable reputation in our sector.
We are a business that invests in new technology to ensure we are creative and forward-thinking. We have nurtured strong relationships with key suppliers and manufacturers to ensure we are always ‘ahead of the curve’ and our collaborative nature means that we always view these relationships as a two way street. We are active participants in beta tests and field trials, and pride ourselves on providing real world feedback to manufacturers so that they can produce the best equipment for ourselves and our clients.
A key part of our strategy is maintaining and strengthening relationships with our clients, working collaboratively with them to win commissions and bring in confirmed work. We sometimes offer our services to help pilot or test new ideas, and get involved in the pre-production planning as early as possible to help identify innovative and cost-effective workflows. In the digital age, workflow is king.
The media industry – particularly in the broadcast and film sector – can suffer turbulence due to high level changes at broadcaster and commissioner levels. We pride ourselves on keeping ahead of these changes and working with our clients to maximise our collective potential.
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FILMS @ 59 HOLDINGS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
Business Activities and Performance
Following the restructure, turnover in the year to December 2021 totalled £15m. This was a very pleasing result and confirmed the underlying strength of the business, coming as it did after the severe disruption due to COVID-19 in 2020.
Investment in 2021 returned to normal levels as strong demand for both equipment hire and post production drove the need for additional resources. In particular, we now have a far stronger offering in the market for drama equipment, with a growing reputation for quality and flexibility.Films at 59 is an award winning media support company based in the Bristol, UK. The company has gained both national and international recognition for its work in a variety of genres, but always in partnership with other businesses both within our region and beyond. We are fiercely proud of our Bristol heritage and the creative city we live and work within, and have always strived to work collaboratively to bring success not only to ourselves, but to the city and region as a whole.
As well as being a good employer (the majority of our staff have grown with the business for over 10 years), having created many full time jobs, championed the local freelance economy and provided business opportunities to our various clients and suppliers, the company's prime directive has always been 'customer satisfaction' - getting good products to people at fair prices and providing excellent after sales support. Most of our business is repeat business from long established relationships or via word of mouth. Our customers know we stand behind what we do.
The Group endorses the active application of equal opportunities policies to provide fair and equitable conditions for all employees regardless of sex, family status, religion, creed, colour, ethnic origin, age, disability or sexual orientation.
Consultation with employees has continued at all levels, with the aim of ensuring their views are taken into account when decisions are made that are likely to affect their interests and that all employees are aware of the performance of the company and issues in the wider industry
The directors have reviewed and agreed policies for managing the financial risks, and these are summarised below:
1/ COVID-19
The film and television sector faced a number of unique challenges as it navigated through the changing landscape of the COVID-19 pandemic. Our strategy of maintaining close contact with our clients meant we were in a position to provide the services they required during and beyond lockdown in the UK and elsewhere.
As restrictions began to slowly ease in 2021, broadly speaking, the measures we adopted in 2020 helped to steer us through the worse of the lockdowns, and we were well positioned to restart and grow our operations when required. During the year it became more evident that there is a strong demand for the type of content that we work on, and the underlying growth trend of the SVOD marketplace was strengthened during 2020 and early 2021 as significant numbers of people were forced to stay at home and needed distraction and entertainment.
We are reliant on our clients to win commissions from the broadcasters and SVOD services, and it is in our best interests to help them achieve that, against the background of the ongoing effects of the pandemic, whether through the use of new technology on location and in production, or by changes to the way we work to deliver those commissions.
2/ The Marketplace
The changes to our market continue as technology evolves and new ways of producing and consuming content become popular. There has been further growth in “Subscription Video on Demand” (SVOD) streaming services in 2021, primarily out of the USA, and these new broadcasters have generated strong demand for high quality content, both in factual and entertainment genres. An interesting facet of this trend is that their customer base is generally global, and as such they are commissioning content globally as well.
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FILMS @ 59 HOLDINGS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
The traditional broadcasters are not unaware of these changes in the marketplace, and many have launched their own SVOD services to complement their traditional broadcast channels. BBC Studios – the independent, commercial production company spun out of the BBC – continues to find its feet, and as it is outside of the public service BBC organisation, it is able to take advantage of other commercial opportunities with different broadcasters and the SVOD services.
In Bristol, SVOD broadcasters such as Netflix, Disney+ and Apple continue to commission work from our clients as they seek to build genre libraries, primarily natural history and drama, and a marked acceleration of their activity in 2020/2021 was a key factor driving our recovery from the effects of the pandemic. 4K (UHD) and High Dynamic Range (HDR) content is becoming much more common, particularly for the SVOD services.
Moving forward, we face the following risks in the marketplace:
Ongoing Market Disruption Risk
We are ultimately dependent on our clients winning commissions from broadcasters and high level changes continue to be disruptive. We are, however, aware of these factors and work hard with our clients to deliver that ‘little bit extra’ that hopefully helps their programmes attract the audiences that provide future commissions. There is continuing pressure across the public broadcasters for increased investment in the nations and regions which brings opportunities that will be approached with enthusiasm and care. Similarly, the SVOD services are a major market disruptor, supporting a secular shift in viewing habits which is generational in scope.
Price risk
We continue to compete effectively and are regularly monitoring our services. We are in a competitive market and feel that global uncertainty, as well as flux in broadcaster commissions, has forced rates down. In an industry with a high level of ‘value add’, we are also unfortunately facing some competition based on ‘price’ rather than ‘value for money’. We continue to work with our clients to maintain a balance that ensures they receive the creative and technical expertise they demand whilst keeping the business sustainable.
Interest rate risk
Group bank borrowings incur interest at market rates. The Group mitigates its exposure through the ongoing monitoring of the rates being applied. We continue to keep our borrowings at a sustainable level that allows for a sensible amount of ongoing investment.
Credit risk
Customer credit risk is addressed through a mixture of credit worthiness checks and a proactive approach to credit control. Through the COVID-19 pandemic, we will be paying particular attention to at-risk accounts and act in advance to put in place payment plans or limit exposure.
3/ The Technology
Technology moves ever onward, with 4K (UHD) replacing high definition (HD) as the high-end format of choice and an increasing number of programmes being delivered in High Dynamic Range (HDR) formats. New camera technology is coming to market all the time, and a strategic approach is needed to ensure that our finite resources are invested wisely. File-based delivery over the Internet is now the norm and continual investment is needed in connectivity, storage and the technology to secure our systems and processes. Our investment in previous years has put us in a good position to take advantage of these developments, and we continue to pursue relationships with manufacturers and suppliers that provide us with insight into their future direction.
4/ The Operation
We work closely with our project management and workflow teams to ensure we have a transparent and accurate way of managing projects, and ensure new learning is applied easily to new projects. Our internal (bespoke) booking system has been further enhanced to focus on revenue prediction, cost reconciliation and workload management.
We also continue to work closely with our clients to provide in-house training of their teams to help ensure efficiencies are made across the board. We have worked hard to continue to invest in our staff to meet ever-changing creative, technical, and cultural changes in the business.
We are continually watchful of sales revenue and costs in these tough and unprecedented economic times.
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FILMS @ 59 HOLDINGS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
5/ Other Macro-Economic Factors
Whilst it may be argued that the direct effects of the COVID-19 pandemic have moved into the background, the indirect effects are potentially more of a long term threat to the stability of the current global economic system. In particular, the notion of very non-redundant, global supply chains is being challenged, as ongoing disruption to shipping, offshore manufacturing and raw material supply provides an argument for unwinding the decade’s long shift towards significant consolidation and offshoring of key manufacturing activities.
In particular, our industry has a high reliance on technology, and the concentration of key parts of the technology supply chain into the hands of a very small number of global players, has seen shortages and supply disruptions which have had a negative impact on the availability of everything, from cars through to graphics cards.
We are also facing unprecedented challenges to global energy and food supplies, exacerbated by geopolitical developments but fundamentally underscored by the need to move away from fossil fuels to satisfy the drive to combat man-made climate change.
We are already seeing our energy costs increase, and upward pressure on wages continues as domestic economic conditions make it more difficult for households to make ends meet. It is also certain that as disposable incomes reduce – both in the UK and worldwide – maintaining subscriptions to multiple SVOD services will no longer be sustainable, and we may well see a reduction in production activity or consolidation in the sector as those services unable to attract sufficient subscribers are swept up by more dominant players.
We have also experienced difficulty securing new equipment due to global shortages, although we have mitigated the impact of this by careful planning and making sure that we factor in the potential for delays to supply. In equipment hire, it is interesting that our clients are now also aware of the possibility of shortages, and are more proactive in planning their bookings as a result.
All of these factors are, of course, out of our control, however we are not unaware of their significance, and make sure that all of our decision making is in line with our best predictions for the macro-economic conditions within which the business operates.
The company uses a variety of metrics to assess performance, including turnover, profit before tax, cash and cost of sales.
FINANCIAL KEY PERFORMANCE INDICATORS
Profit before tax for the year ending December 2021 was £3.9m, a continuing reflection of the results of our efforts to restructure the group for sustainability and profitability during a very difficult period. Turnover for the year ending December 2021 was £15m.
Closing cash balance for the year ending December 2021 was £5.7m, which is largely due to the restructure of the business removing surplus assets. Beyond that, however, our underlying cash balance increased, reflecting our cautious approach to investment and control of operating costs.
Cost of sales as a percentage of turnover for the year ending December 2021 was 28%.
NON-FINANCIAL KEY PERFORMANCE INDICATORS
Client retention is an important KPI for us. Almost all of the clients present in our top twenty customer list from the year ending December 2020 are present in or around the top twenty list for the year ending December 2021.
Attracting new clients and new business is also very important. We have seen steady growth in new accounts this year, with over 130 account openings across both post production and equipment hire.
Employee retention is also key across creative, support and administration areas, although we promote a regular throughput of runners and junior trainee positions to bring new talent into the industry. In the year ending December 2021, our non-runner employee retention rate was 88%.
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FILMS @ 59 HOLDINGS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
Consultation with employees has continued at all levels, with the aim of ensuring their views are taken into account when decisions are made that are likely to affect their interests and that all employees are aware of the performance of the company and issues in the wider industry.
It was always an ambition of the original shareholders to implement an employee share ownership scheme. Progress was made with this in 2020, but it was ultimately put on hold due to the uncertainty of the COVID-19 pandemic.
However, as the situation clarified in 2021, clearance from HMRC was sought and obtained and the scheme came into existence in February 2021. As a result, Films at 59 has transitioned to an Employee Owned Company, with an Employee Benefit Trust and an EMI Scheme the mechanism used to implement this change.
Thanks to robust trading activity and a windfall return on investment in 2019, the company was in a strong financial position at the start of the COVID-19 pandemic. The Directors have considered the principle risks to the Group and feel that as restrictions are eased and different ways of working are adopted, that there is an underlying strong demand that will underpin future trading. Our record results in 2021 seem to support that view. Certainly, the sector as a whole is reporting strong trading conditions and there is a feeling that we are currently in a ‘golden age’ for content production as the SVODs continue to disrupt the market.
This is a structural change in viewing habits, accelerated by the pandemic, which puts the producers of quality content on a strong footing going forward. The UK and Bristol in particular has a global reputation for producing such content, and inward investment into the UK will benefit our clients, which in turn provides us with a positive trading outlook for the next few years.
COVID-19 has caused widespread economic disruption but its impact is hopefully now diminishing, although supply chain disruption is still evident and the availability of some technical equipment is restricted. Post production activity is largely office based, and as such, adherence to government guidelines and adoption of industry best practice should restrict ongoing operational disruption. Production teams out on location have in place protocols to avoid adverse impact due to COVID-19 infections and this appears to be largely successful.
However, a key risk is a resurgence of the virus causing significant staff absences, both for us and our clients, or that travel and access restrictions could significantly disrupt filming of new content. This would not only directly affect the equipment hire arm of the company, it would also feed through into reduced post production revenues.
The management are continuing to take a number of mitigating measures to reduce the impact of COVID-19 infections, including :
∙Use of testing where an infection is suspected, with a 5 day minimum ‘work from home’ recommendation.
∙Implementation of a strong sanitising regime, liberal use of floor markings to help with social distancing, and a strong message of safety and consideration given to both our staff and clients who come into our buildings.
∙Setting of capacity limits for operational areas such that we can work safely with the required social distancing measures in place.
∙Home working for staff, where appropriate, is being flexibly used to reduce risk at our offices.
∙Clients have the option of remote editing, where appropriate, to reduce their exposure and lessen the risks to our staff.
We are also entering a difficult period of global instability, as a number of factors conspire to disrupt supply chains, increase the cost of energy, and generally raise inflation to uncomfortable levels. These factors are all outside of our control, however a careful and prudent approach to investment, as well as maintaining strong cost controls, are seen as a sensible response. We always work closely with our clients to maximise their production budgets, and with upward pressure on prices, this is more important than ever.
Taking these factors into consideration, and also with reference to the strength of the Group’s balance sheet and forward order book, the directors believe the Group will be able to continue to trade for the foreseeable future.
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FILMS @ 59 HOLDINGS LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
This report was approved by the board and signed on its behalf.
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FILMS @ 59 HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
The directors present their report and the financial statements for the year ended 31 December 2021.
The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments 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 Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £3,035,261.
During the period no dividends (2020: £Nil) on ordinary shares were recommended or paid. The company has accrued £17,808 for the preferential dividend relating to the 2021 financial year.
The directors who served during the year were:
The future developments of the business are included within the Strategic Report.
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FILMS @ 59 HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
There have been no significant events affecting the Group since the year end.
The auditors, Bishop Fleming LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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FILMS @ 59 HOLDINGS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FILMS @ 59 HOLDINGS LIMITED
We have audited the financial statements of Films @ 59 Holdings Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2021, which comprise the Group Statement of comprehensive income, the Group and Company Statements of financial position, the Group Statement of cash flows, the Group and Company Statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
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 Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the 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 Auditors' 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.
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FILMS @ 59 HOLDINGS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FILMS @ 59 HOLDINGS LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the Directors' report.
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FILMS @ 59 HOLDINGS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FILMS @ 59 HOLDINGS LIMITED (CONTINUED)
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 Auditors' 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 Group 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.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and noncompliance with laws and regulations, we have considered the following:
∙The nature of the industry and sector, control environment and business performance;
∙Results of our enquires of management and directors in relation to their own identification and assessment of the risks of irregularities within the Group; and
∙any matters we identified having obtained and reviewed the Group’s documentation of their policies and procedures relating to: identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; the internal controls established to mitigate risks of fraud or noncompliance with laws and regulations.
As a result of these procedures, we have considered the opportunities and incentives that may exist within the organisation for fraud and identified the area of high risk to be in relation to revenue recognition, with a particular risk in relation to year-end cut-off. In common with all audits under ISAs (UK) we are also required to perform specific procedures to respond to the risk of management override.
We have also obtained an understanding of the legal and regulatory frameworks that the Group operates in, focussing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures within the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and UK tax legislation. In additions we considered provision of other laws and regulations that do not have a direct effect on the financial statements but compliance with may be fundamental for the Group’s ability to operate or avoid a material penalty. These included health and safety regulations, employment legislation and data protection laws.
Our audit procedures performed to respond to the risks identified included, but were not limited to:
∙Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
∙Reviewing the financial statement disclosures and testing to supporting documentation to assess the recognition of revenue;
∙Challenging assumptions and judgments made by management in their significant accounting estimates;
∙Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulation and fraud;
∙Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
∙Reviewing board minutes; and
∙Identifying and testing journal entries, evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
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FILMS @ 59 HOLDINGS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF FILMS @ 59 HOLDINGS LIMITED (CONTINUED)
Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from an error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Auditors' 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.
for and on behalf of
Chartered Accountants
Statutory Auditors
10 Temple Back
BS1 6FL
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FILMS @ 59 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021
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FILMS @ 59 HOLDINGS LIMITED
REGISTERED NUMBER:12550376
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 20 to 39 form part of these financial statements.
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FILMS @ 59 HOLDINGS LIMITED
REGISTERED NUMBER:12550376
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 20 to 39 form part of these financial statements.
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FILMS @ 59 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
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FILMS @ 59 HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
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FILMS @ 59 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2021
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FILMS @ 59 HOLDINGS LIMITED
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 19
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Films at 59 Holdings Limited is a company limited by shares incorporated in England and Wales. The registered office is 59 Cotham Hill, Clifton, Bristol, BS6 6JR.
2.ACCOUNTING POLICIES
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of financial position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.ACCOUNTING POLICIES (continued)
Functional and presentation currency
Transactions and balances
Rentals paid under operating leases are charged to the statement of comprehensive income on a straight line basis over the lease term.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.ACCOUNTING POLICIES (continued)
Grants of a revenue nature are recognised in the Consolidated statement of comprehensive income in the same period as the related expenditure.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.ACCOUNTING POLICIES (continued)
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.ACCOUNTING POLICIES (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, SELECT OR ENTER METHOD.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.ACCOUNTING POLICIES (continued)
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Statement of financial position. The annual amortisation charge is sensitive to any changes in the estimated useful life and residual values of the intangible asserts. The useful economic lives and residual value is assessed on an annual basis and are amended only when evidence shows a change in the estimated economic lives or residual life. Criteria used to assess the economic life and residual value includes technological advancement, economic utilisation condition the asset and future investments. The company holds significant fixed asset across a range of categories. The rates of depreciation applied to fixed assets are based on management's estimate of the useful economic life of these assets and estimate of the period over which economic benefits are likely to flow to the company from their use. Tangible fixed assets are impaired where management consider their net book value to be greater than their recoverable amount. The recoverable amount is assessed as the higher of management's best estimate, given available information, of the future economic benefits to the company from using the asset and the price which could be obtained in an orderly sale of the asset.
Page 25
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Analysis of turnover by country of destination:
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 28
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 29
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
12.TAXATION (CONTINUED)
The UK corporation tax rate will rise from 19% to 25% in 2023 and this was substantively enacted on 24
May 2021. Accordingly, this rate will be used to measure any deferred tax assets and liabilities in future reporting periods.
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Page 31
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
14.TANGIBLE FIXED ASSETS (CONTINUED)
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 33
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 34
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 35
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
During the year 117,999 Ordinary shares and 100,000,000 preference shares were issued for a total consideration of £1,180 and £1,000,000 respectively.
Ordinary shares rank equally for voting purposes, dividends declared on for distributions made on winding up. The shares are not redeemable. Preference shares do not carry voting rights and are entitled to a fixed cumulative preferential dividend at an annual rate of 2%. The shares are not redeemable.
The company has accrued £17,808 for the preferential dividend relating to the 2021 financial year.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Profit and loss account
Page 37
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
26.BUSINESS COMBINATIONS (CONTINUED)
During the period the Group made pension contributions to defined contribution pension schemes on behalf of employees of £253,901 (2020: £nil). At the period end, the Group owed £33,895 (2020: £nil). This is included within other creditors.
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FILMS @ 59 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Page 39
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