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Registered number: 12475228
KKV INVESTMENT MANAGEMENT LTD
UNAUDITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 DECEMBER 2021
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KKV INVESTMENT MANAGEMENT LTD
REGISTERED NUMBER: 12475228
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2021
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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Capital redemption reserve
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KKV INVESTMENT MANAGEMENT LTD
REGISTERED NUMBER: 12475228
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2021
The directors consider that the Company is entitled to exemption from audit under section 477 of the Companies Act 2006 and members have not required the Company to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 13 April 2022.
The notes on pages 3 to 12 form part of these financial statements.
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
KKV Investment Management Ltd is a Company incorporated in England and Wales.
The address of the Company's registered office and principal place of business is 25 Upper Brook Street London W1K 7QD.
The Company's principal activity is the provision of business consultancy services.
The financial statements are presented in pound sterling which is the functional currency of the company and have been rounded to the nearest £.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The following principal accounting policies have been applied:
During the year ended 31 December 2021, the Company incurred losses in the amount of £2,145,863 (2020: £1,346,322). At the balance sheet date, the Net liabilities exceeded its assets by £2,532,187 (2020: £386,322).
The Board of Directors have considered the foreseeable future of the entity and assessed the circumstances at the year end date. Due to the significant debt owing and the material uncertainties of future revenue opportunities, the Board have deemed it not appropriate to prepare the financial statements on a going concern basis. The financial statements have therefore been prepared on a break-up basis and as a result any long-term liabilities have been recognised as short-term obligations and assets have been restated for their recoverability.
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.Accounting policies (continued)
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:
Rendering of services
Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of turnover can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.Accounting policies (continued)
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
Interest income is recognised in profit or loss using the effective interest method.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the over its useful economic life.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
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.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line 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.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company 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 Company only enters into basic financial instrument transactions that result in the recognition of
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.Accounting policies (continued)
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Financial instruments (continued)
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financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Investments in non-derivative instruments that are equity to the issuer are measured:
∙at fair value with changes recognised in the Statement of Comprehensive Income if the shares are publicly traded or their fair value can otherwise be measured reliably;
∙at cost less impairment for all other investments.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the reporting date.
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The number of employees, including directors, at the end of the financial year was 9 (2020: 25).
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The average monthly number of employees, including directors, during the year was 12 (2020 - 17).
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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The individual intangible asset related to transaction fee paid to obtain a contractual right to act as the Portfolio Manager of KKV Secured Loan Fund (KSLF), inclusive of costs directly attributable relating to this contractual agreement. During the year, the contractual agreement to act as Portfolio Manager ceased through mutual agreement and the intangible asset has been fully amortised.
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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Charge for the year on owned assets
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Prepayments and accrued income
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Cash and cash equivalents
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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Creditors: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Loans from ultimate parent company
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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Hire purchase and finance leases
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Minimum lease payments under hire purchase fall due as follows:
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Financial assets measured at fair value through profit or loss
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Financial assets measured at fair value through profit or loss comprise cash at bank.
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Allotted, called up and fully paid
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860,000 (2020 - 960,000) Ordinary shares of £1.00 each
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During the year, the company redeemed 50,000 ordinary shares at £1 each on 31 August 2021 and another 50,000 ordinary shares at £1 each on 31 December 2021.
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KKV INVESTMENT MANAGEMENT LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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Commitments under operating leases
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At 31 December 2021 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Related party transactions
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Kvika Securities Limited (KSL) owns 87.209% of KKV Investment Management Ltd (KKV), creating a related party relationship. KSL entered into a contractual agreement with KKV to provide the following services: Monitoring, Appointed Representative, AIFM and Non-Executive Directors and KKV pays a quarterly fee of £71,250 to KSL for these services. The total fees paid in the financial year were £285,000 (2020: £90,750). At the year end date, the amount due to KSL was £76,250 and a loan of £1,022,507 (2020: £4,367)
The ultimate parent company of KKV is Kvika Banki, as a result of its 100% ownership of Kvika Securities Limited. Kvika Banki provided a loan facility to KKV during the financial year of £1,368,170 (2020: £824,862). The loan facilities falls due on 31January 2022.
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Kvika Securities Limited (KSL) owns 87.209% of KKV. KSL is a wholly owned subsidiary of Kvika Banki hf., an Icelandic financial institution which is regulated by the Icelandic Financial Supervisory Authority. Therefore KSL's consolidated accounts (which includes KKV) are included in the consolidated financial statements of Kvika Banki hf within KSL, a copy of which are available at www.kvika.is. Kvika banki hf. is a limited liability company incorporated and domiciled in Iceland, with its registered office at Katrínartún 2, Reykjavík.
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