COUPA_SOFTWARE_UK_LIMITED - Accounts

The director presents the strategic report for the year ended 31 January 2022.

Coupa Software UK Limited is a 100% owned subsidiary of Coupa Software Inc (CSI). involved in provision of marketing and support activities.

We derive our revenues primarily from revenues from services provided to our parent company Coupa Software Inc. along with license fees, subscription fees and professional services fees from external customers. The reported intergroup revenue represents 75% of our total revenue while external revenues represents 25% of our total revenue.

The results of our operations can be seen on page 10 below, further details in notes to Financial Statements starting on page 13 and below. Considering the remuneration received from the parent company, it is expected that our company will always have a profit position.

The Covid-19 pandemic, aggravated by the Brexit implementation brought huge amount of uncertainty for the UK economy, however, due to the business model in operation, directors are confident that Coupa Software UK Limited will continue to play a vital role as we increase our global footprints including but not limited to the UK. The spread of COVID-19 has also caused us to modify our business practices. We have reopened our offices globally and held in person conference events.

As Coupa UK operates under the transfer pricing model and is shielded from market fluctuations and or adverse factors, directors believe general economic risks facing the parent entity CSI are somewhat appropriate to all of its international operations, including Coupa Software UK Limited. To name the few are, Russia/Ukraine war, Brexit challenges, Covid-19 pandemic, raising global inflation, currency fluctuations, our inability to attract new customers or retail the existing ones and the very competitive market in which we operate.

With attention to our stable financial situation and forward-looking management, there are no known extraordinary risks that could endanger the existence of Coupa Software UK Limited and its business model.

Our parent entity business model focuses on maximizing the lifetime value of our customer relationships and we need to make investments in order to add new customers to grow our customer base. As of January 31st, 2022 our US parent entity has acquired Exari, Llamasoft and Bellin group with operations in the UK. These entities have been merged into Coupa Software UK Limited which will increase our future revenues, headcount, operating costs and the overall size of our UK operations.

Coupa uses multiple financial and non-financial KPIs when measuring performance of its international operations namely;

Revenues increased by 9.6% from £21.4m in the prior year to £23.4m in the current year as a result of increased intercompany revenue.

The average headcount in the current fiscal year (134 employees) has increased by 15% compared to the previous year (117 employees).

Coupa Software UK Limited had moved from net liability position at 31 January 2021 to a net asset position at 31 January 2022. The change from net liability position to a net asset position is due to the recognition of a previously unrecognised deferred tax asset.

The entity had an operating profit in the year ended 31 January 2022 of £1.65m (2021: £1.53m).

Overall, we are aiming for positive results in the coming financial year due to the increased cooperation with our parent company Coupa Software Inc. and the consolidated personnel structures. We expect a positive EBITDA and positive net profit for the year.

We expect our UK operations to continue to grow and play a pivotal role in our non-US operations and our global footprint in general. Our UK entity will become one or our largest entities outside of United States once we integrate the acquired entities into this subsidiary.

On behalf of the board

The director presents his annual report and financial statements for the year ended 31 January 2022.

The financial statements have been prepared in accordance with the provisions of Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

The company is registered in England and Wales. The main activity of the company is to provide sales and marketing support to the parent company Coupa Software US.

The results for the year are set out on page 10. No ordinary dividends were paid. The director does not recommend payment of a final dividend.

The director who held office during the year and up to the date of signature of the financial statements was as follows:

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial instruments and future developments.

In accordance with the company's articles, a resolution proposing that BDO LLP be reappointed as auditor of the company will be put at a General Meeting.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

At the time of approving the financial statements, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Coupa Software UK Limited had

moved from net liability position at 31 January 2021 to a net asset position at 31 January 2022.

The Director has made specific consideration of the impact of the global Covid-19 pandemic in the going concern assessment. The external customers contracted with this entity are generally large ‘blue chip’ companies. The principal activity of the entity has been able to continue, without disruption, throughout the current Covid-19 pandemic, as employees are able to work remotely.

Nearly all of the external revenue is from recurring annuity contracts that are billed upfront in advance. The majority of the cost base is payroll and related expenses and is therefore predictable to forecast base values and timing of outflow. Therefore, it is considered that any costs/outflows incurred that are in excess of the cash generated by the external revenues, will be covered by the contractual intercompany arrangement and settled as required to enable the company to meet these obligations.

The Director has assessed that Coupa Software Inc is able to meet the amounts that will fall due under this arrangement as evidenced by its publicly available results that includes forward looking statements for the quarter ahead and full fiscal year for total revenues, non-GAAP income and other relevant financial metrics. The Director also has access to the latest forecast data and has made their assessment for the foreseeable future, covering a period of at least twelve months from when the 2022 financial statements are authorised for issue or at least up to 31 December 2023.

Thus, the Director continues to adopt the going concern basis of accounting in preparing the financial statements.

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland". Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the director is required to:

•     select suitable accounting policies and then apply them consistently;

•     make judgements 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 company will continue in business.

The director is 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 enable them to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In our opinion the financial statements:

•     give a true and fair view of the state of the Company’s affairs as at 31 January 2022 and of its profit for the year then ended;

•     have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

•     have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements of Coupa Software UK Limited (“the Company”) for the year ended 31 January 2022 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and the Notes to the Financial Statements, 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).

Basis for opinion

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 Auditor’s responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the Director’s 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 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 Director with respect to going concern are described in the relevant sections of this report.

Other information

The director is responsible for the other information. The other information comprises the information included in the annual report other than the financial statements and our auditor’s report thereon. 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.

Other Companies Act 2006 reporting

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the Strategic report and the Director’s report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the Strategic report and the Director’s report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the Director’s report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

• the financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of Director’s remuneration specified by law are not made; or

• we have not received all the information and explanations we require for our audit.

As explained more fully in the Director’s responsibilities statement, the Director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Director is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Director either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

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 auditor’s 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 financial statements.

Extent to which the audit was capable of detecting irregularities, including fraud

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:

Identifying and assessing potential risks related to irregularities, including fraud

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

•     obtaining an understanding of the legal and regulatory frameworks that the company operates in, focusing on those laws and regulations that had a direct effect on the financial statements or that had a fundamental effect on the operations of the company. The significant laws and regulations we considered in this context included the UK Companies Act, the accounting framework, and relevant tax legislation.

•     enquiring of management, including obtaining and reviewing supporting documentation, concerning the company’s 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; and

•     the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.

•     discussing among the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in revenue recognition, specifically external revenue, as well as management override of controls through manual journals and abnormal contra entries to revenue.

Audit response to risks identified

Our procedures to respond to risks identified included the following:

• Reading the financial statement disclosures and testing and agreeing to supporting documentation to assess compliance with relevant laws and regulations;

• Enquiry of management around actual and potential litigation and claims and review of legal and professional general ledger accounts;

• Reading minutes from board meetings of those charged with governance to identify any instances of non-compliance with laws and regulations;

• In addressing the risk for fraud in revenue recognition, specially pertaining to external revenue, testing the existence of revenue by agreeing to the signed contract/order form, invoice and cash, as well as recalculating the expected revenue and deferred revenue balance.

• In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments, specifically unexpected contra entries to revenue, deferred revenue, intercompany and cash; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We 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.

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 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 are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council’s website at:

https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our 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 auditor’s 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.

The income statement has been prepared on the basis that all operations are continuing operations.

Coupa Software UK Limited is a private company limited by shares incorporated and registered in England and Wales. The registered office is 3 Forbury Place, 23 Forbury Road, Reading, RG1 3JH.

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.

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.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares;

• Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 26 ‘Share based Payment’ – Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

• Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel.

At the time of approving the financial statements, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.true Coupa Software UK Limited had moved from a net liability position at 31 January 2021 to a net asset position as at 31 January 2022. The entity had an operating profit in the year ended 31 January 2021 and the year ended 31 January 2022. The entity has access to support from its ultimate parent company, Coupa Software Inc. primarily via a contractual transfer pricing arrangement to ensure it receives a remuneration for the services performed, at an arm's length.

The Director has assessed that Coupa Software Inc is able to meet the amounts that will fall due under this arrangement. Thus, the Director continues to adopt the going concern basis of accounting in preparing the financial statements.

The majority of the external revenue is from recurring annuity contracts that are billed upfront in advance. The majority of the cost base is payroll and related expenses and is therefore predictable to forecast base values and timing of outflow. Any reduction in external revenue would be offset by an increase in transfer pricing revenue from the ultimate parent company, as per the current Group policy.

Accordingly, the entity has a reasonable expectation for a continued operating profit result in the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.

Revenue is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. For long term support, hosting and license contracts, revenue is recognised in equal instalments over the period of the contract.

Revenue from contracts for the provision of professional services is recognised over the period to which the service relates.

The company qualifies for the UK Research and Development Expenditure Credit "RDEC" scheme. Income received under this scheme is recorded as other operating income.

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.

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

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.

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.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include trade and 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 unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including trade and other payables and loans from fellow group companies, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

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.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax 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 income statement, 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.

The costs of short-term employee benefits are recognised as a liability and an expense.

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.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Share based payment charges incurred by and recharged from the ultimate parent are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest.

When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.

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.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

In the application of the company’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

In calculating the R&D taxation credits due to the Group, judgement is required in determining if engineering and development projects qualify as innovative, involve outcome uncertainty and advance the overall knowledge in line with the relevant taxation literature. The classifications and conclusions are performed by employees knowledgeable about the relevant scientific and technological principles involved and reviewed by finance and management.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:

In recognising a deferred tax asset an element of inherent uncertainty exists, as this depends on forecasting sufficient future profit levels within this entity that allow the asset to be utilised. The current Group transfer pricing policy along with additional new sources of income provides a degree of confidence with which to forecast a range of reasonable profit levels. Based on the forecasted profitability, the deferred tax asset has been recognised in full during the current year. However, in achieving the forecasted profit levels, there is uncertainty as to when the asset will be utilised due to the potential future large tax deductions available in relation to share options in Coupa Software Inc, by employees of this entity.

An analysis of the company's revenue is as follows:

Total qualifying Research and Development cost for the period was calculated £nil (2021: £1.04m at a blended RDEC rate of 12.83%) resulting in other income of £Nil (2021: £0.13m).

The above analysis excludes revenue from services provided to other Coupa entities.

The average monthly number of persons (including directors) employed by the company during the year was:

Their aggregate remuneration comprised:

As of 31 January 2021 and 31 January 2022, the company did not have any equity-settled plans or transactions. However, the company's ultimate parent Coupa Software Inc, a company listed on NASDAQ, issued their 'Stock Based Compensation Incentive Plan' based on which the parent provided the employees an opportunity to take part in an employee incentive scheme which included issue of restricted stock units and stock options. Additionally there is an Employee Stock Purchase Plan "ESPP".

Under this plan, the company's ultimate parent issues shares of Coupa Software Inc upon vesting of restricted stock units (RSUs). The issuance of shares and cash received upon exercise or sale is undertaken solely by Coupa Software Inc. These incentives have been expensed to the company in the current year (see note 4).

The actual (credit)/charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

No interest is paid on the intercompany balances and they are repayable on demand.

No interest is paid on the intercompany balances and they are repayable on demand.

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

The deferred tax asset set out above is expected to reverse within 49 months and relates to the utilisation of tax losses against future expected profits of the same period.

In the Spring Budget 2021, the government announced that from 1 April 2023 the headline corporation tax rate will increase to 25%. This was substantively enacted on 24 May 2021 and therefore the deferred tax assets and liabilities arising after 1 April 2023 have been recognised using a rate of 25%.

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

The ordinary shareholders are entitled to attend all meetings of the company, to vote on all resolutions, and to receive dividends or other distributions.

On 1st April 2020, Coupa Software UK Limited purchased the trade and assets of Exari Solutions (Europe) Limited and Coupa Operations Inc (UK branch), companies that are also 100% owned by Coupa Software Inc. The consideration for Exari Solutions (Europe) Limited was £6.59m and resulted in the transfer of a net asset of £1.43m, resulting in an other reserve created of £5.16m.  The consideration for Coupa Operations Inc (UK branch) was equal to the book values of a net asset of $5.54m, creating no additional other reserves. The acquisitions have been brought into the accounts using hybrid accounting and as such the current and comparative period results have not been included in the results of this entity. 

Operating lease payments represent rentals payable for the company's office.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

The following amounts were outstanding at the reporting end date:

The following amounts were outstanding at the reporting end date:

The company has taken advantage of the exemption available in Paragraph 33.1A of FRS 102 whereby it has not disclosed transactions with other companies that are wholly owned within the group.

The immediate parent undertaking until 21 December 2021 was Exari Group Inc, of 3500 S DuPont Highway, Dover, Delaware 19901, USA. On this date the immediate parent undertaking transferred to Coupa Operations Inc. After the period end, on 1 February 2022, there was an internal transfer and the immediate parent company since that date is Llamasoft Inc, 201 South Division, Suite 300, Ann Arbor, MI, 48104, United States.

Consolidated accounts including this entity are prepared by Coupa Software Incorporated, registered in Delaware, USA with an address of 1855 S Grant Street, San Mateo, CA, 94402, USA. Coupa Software Incorporated are the smallest and largest entity that the company is consolidated into and their consolidated accounts are filed with the SEC in the USA.

The Coupa group is undertaking an entity rationalization project and as part of this process it is intended that a number of UK related parties will transfer its business assets to Coupa Software UK Limited. After the period ended, on 1 February 2022, Llamasoft Inc transferred the shares in Llamasoft Europe Holdings Ltd to Coupa Software UK Limited, in exchange for shares in Coupa Software UK Limited. On 4 February 2022, the business assets of Llamasoft Europe Holdings Limited were transferred to Coupa Software UK Limited. Subsequently, the shares of Bellin Treasury Alliance Limited were transferred to Coupa Software UK Limited, and on June 30 2022, the business assets of Llamasoft Europe Limited, Optimiza Limited, and Bellin Treasury Alliance Limited were transferred to Coupa Software UK Limited.