My1login Limited - Accounts to registrar (filleted) - small 18.2

REGISTERED NUMBER: 06361491 (England and Wales)

REPORT OF THE DIRECTORS AND

UNAUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2020

FOR

MY1LOGIN LIMITED

Page

Company Information

1

Report of the Directors

2

Balance Sheet

4

Notes to the Financial Statements

6

DIRECTORS:

M Newman

D Cameron

K J Fraser

SECRETARY:

Davidson Chalmers Stewart (Secretarial Services) Limited

REGISTERED OFFICE:

3rd Floor

207 Regent Street

London

W1B 3HH

REGISTERED NUMBER:

06361491 (England and Wales)

ACCOUNTANTS:

Haines Watts

Chartered Accountants

Q Court

3 Quality Street

Edinburgh

EH4 5BP

The directors present their report with the financial statements of the company for the year ended 30 June 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the development of internet based software products.

REVIEW OF BUSINESS

We are delighted to report a year of accelerating revenue growth with our business customer base larger than ever. At the time of filing, annual recurring revenue has grown by 30% despite the challenges of the pandemic and recent developments give us confidence of even more rapid growth in the year ahead. We continue to attract household brands as enterprise customers and have this year enjoyed particular success with the UK policing and defence sectors.

Our focus continues to be on the enterprise market which will deliver higher value contracts. Notwithstanding the particular areas of success above, our customer base now covers a wide breadth of business sectors and we are confident that this will continue to deliver cost effective growth. Opportunities already established with large organisations and an ever increasing pool of qualified prospects has also enabled our revenues to build rapidly through the year and and beyond.

Importantly, our business continues to grow in a growing market. Global Market Insights forecast the Identity and Access Management (IAM) market size will grow at a CAGR of 15% through to 2022 and will be valued at over $26 billion by the end of the period.

The picture that Gartner paints, and the advice we have from them, drives our continuing product development and we have invested heavily in this area to deliver a compelling set of products and services. The breadth of our product range is a key part of the sales pitch that is gaining significant traction with large enterprises and it is particularly satisfying that our UK base and differentiated approach to security is winning customers in highly secure sectors such as Defence, Policing and Financial Services.

From the beginning, we have pursued the process of securing the legal protection for our technology so as to enhance the value of the business. Currently we have patents granted in the US, Canada, Australia, New Zealand, UK and a number of other, strategically important EU countries.

Accelerating our growth in this expanding market has the potential to create substantial value for shareholders. We are delighted to see the benefits of their continued support being reflected in our very real progress.

EVENTS SINCE THE END OF THE YEAR

Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 October 2017 to the date of this report.

M Newman

D Cameron

K J Fraser

R A Gibb - resigned 31 December 2019

N J Roden resigned as a director after 30 June 2020 but prior to the date of this report.

This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small companies.

ON BEHALF OF THE BOARD:

M Newman - Director

30 June 2021

FIXED ASSETS

Intangible assets

4

290,312

249,688

Tangible assets

5

19,666

7,391

309,978

257,079

CURRENT ASSETS

Debtors

6

174,561

146,114

Cash at bank

259,382

474,699

433,943

620,813

CREDITORS

Amounts falling due within one year

7

666,737

610,170

NET CURRENT (LIABILITIES)/ASSETS

(232,794

)

10,643

TOTAL ASSETS LESS CURRENT LIABILITIES

77,184

267,722

CAPITAL AND RESERVES

Called up share capital

9

457,262

420,288

Share premium

3,110,521

2,779,216

Retained earnings

(3,490,599

)

(2,931,782

)

SHAREHOLDERS' FUNDS

77,184

267,722

The company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 30 June 2020.

The members have not required the company to obtain an audit of its financial statements for the year ended 30 June 2020 in accordance with Section 476 of the Companies Act 2006.

The directors acknowledge their responsibilities for:

(a)	ensuring that the company keeps accounting records which comply with Sections 386 and 387 of the Companies Act 2006 and

(b)

preparing financial statements which give a true and fair view of the state of affairs of the company as at the end of each financial year and of its profit or loss for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the company.

The financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the Board of Directors and authorised for issue on 30 June 2021 and were signed on its behalf by:

M Newman - Director

1.	STATUTORY INFORMATION

My1login Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

BASIS OF PREPARING THE FINANCIAL STATEMENTS

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The company generated a trading loss after tax for the financial period of £558,817 (2019 - £377,583). At the period end the company had net current liabilities of £232,794 (2019 - net current assets £10,643) and net assets of £77,184 (2019 - £267,722). The company has convertible loan notes which can be converted at any point in time at the request of a majority of not less than 75% of the notes in issue and, in accordance with accounting standards, the loan notes have therefore been classified within creditors falling due within one year.

The company has raised funding of £404,042 post year end from an issue of shares. On this basis the directors believe there will be sufficient funding in place to provide the working capital required by the company for a period of at least 12 months from the date of signing the financial statements.

The financial statements have been prepared on a going concern basis. The Directors have reviewed and considered relevant information, including the annual budget and future cash flows in making their assessment. In particular, in response to the COVID-19 pandemic, the Directors have tested their cash flow analysis to take into account the impact on their business of possible scenarios brought on by the impact of COVID-19, alongside the measures that they can take to mitigate the impact. Based on these assessments, given the measures that could be undertaken to mitigate the current adverse conditions, and the current resources available, the Directors have concluded that they can continue to adopt the going concern basis in preparing the annual report and accounts.

TURNOVER

Turnover is measured when services are performed on a straight-line basis over the specified period unless there is evidence that some other method better represents the stage of completion. When a specific act is much more significant than any other act, the entity postpones recognition of revenue until the significant act is executed.

OTHER INTANGIBLE ASSETS

Expenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally generated intangible asset can be recognised, development expenditure is expensed in the period as incurred.

An intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of the following have been demonstrated:

-the technical feasibility of completing the intangible asset so that it will be available for use or sale;

-the intention to complete the intangible asset and use or sell it;

-the ability to use or sell the intangible asset;

-how the intangible asset will generate probable future economic benefits;

-the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

-the ability to measure reliably the expenditure attributable to the intangible asset during its development.

The amount initially recognised for internally generated intangible assets is the sum of expenditure incurred from the date when the intangible asset first meets the recognition criteria listed above.

Subsequent to the initial recognition, internally generated intangible assets are reported at cost less accumulated amortisation and accumulated impairment losses.

Internally generated assets are amortised over their estimated lifespan depending on each asset. The asset lifespan is estimated by management based on experience of similar assets in the past.

Other intangible assets that are acquired are stated at cost less accumulated amortisation and less accumulated impairment losses.

Amortisation

Amortisation is charged on a straight-line basis over the estimated useful lives of intangible assets. Other intangible assets are amortised from the date they are available for use. The estimated useful lives are as follows:

- internally generated development costs over estimated lifespan, currently three years.

TANGIBLE FIXED ASSETS

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Fixtures and fittings

-

33% per annum on cost

Computer equipment

-

33% per annum on cost

GOVERNMENT GRANTS

Government grants are recognised when it is reasonable to expect that the grants will be received and that all related conditions will be met. Grants of a revenue nature are credited to income so as to match them with the expenditure to which they relate.

Job Retention Scheme grants relates to staff that have been furloughed due to Covid-19. The Small Business Grant relates to assistance with business costs due to Covid-19.

FOREIGN CURRENCIES

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

HIRE PURCHASE AND LEASING COMMITMENTS

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

PENSION COSTS AND OTHER POST-RETIREMENT BENEFITS

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 19 (2019 - 16 ) .

4.	INTANGIBLE FIXED ASSETS

Other

intangible

assets

£

COST

At 1 July 2019

1,188,382

Additions

249,908

At 30 June 2020

1,438,290

AMORTISATION

At 1 July 2019

938,694

Charge for year

209,284

At 30 June 2020

1,147,978

NET BOOK VALUE

At 30 June 2020

290,312

At 30 June 2019

249,688

Intangible fixed assets relate to costs and salaries incurred in developing the company's software product.

5.	TANGIBLE FIXED ASSETS

Fixtures

and

Computer

fittings

equipment

Totals

£

£

£

COST

At 1 July 2019

6,457

20,475

26,932

Additions

8,471

15,484

23,955

At 30 June 2020

14,928

35,959

50,887

DEPRECIATION

At 1 July 2019

4,930

14,611

19,541

Charge for year

3,921

7,759

11,680

At 30 June 2020

8,851

22,370

31,221

NET BOOK VALUE

At 30 June 2020

6,077

13,589

19,666

At 30 June 2019

1,527

5,864

7,391

6.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Trade debtors

64,081

82,701

Other debtors

110,480

63,413

174,561

146,114

7.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Trade creditors

48,238

34,819

Social security and other taxes

60,812

43,105

VAT

2,981

728

Other creditors

5,147

4,742

Credit card

6,908

6,043

Convertible loan notes

307,599

291,560

Deferred income

218,009

210,626

Accrued expenses

17,043

18,547

666,737

610,170

The convertible loan notes are repayable on 5 May 2022 or, if earlier, an event of default (which includes an exit event) or can be converted into shares at any time at the request of a majority of not less than 75% of the notes in issue (which must include Scottish Enterprise). The notes are, therefore, presented within creditors falling due within one year.

The noteholders have no rights to call for repayment prior to 5 May 2022, other than in the circumstances of an event of default.

On conversion, the whole of the amount due to noteholders would immediately be applied in paying up new shares to be issued to them and no amount would be repaid in cash to noteholders.

8.	LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

2020

2019

£

£

Within one year

47,486

15,526

Between one and five years

40,702

-

88,188

15,526

9.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2020

2019

value:

£

£

420,288

Ordinary Share Capital

£1

457,262

420,288

36,974 Ordinary Share Capital shares of £1 each were allotted as fully paid at a premium of £10.04 per share during the year.

The total consideration received was £408,193 and fees incurred in connection with the issues totalling £39,914 have been debited to the Share Premium Reserve.

Share Options

Share options have been granted to 'Employees' and to 'Others' to subscribe for ordinary shares of My1login Limited.

The number of shares granted in the current scheme for 'Employees' is (depending on future employment status) 26,018 ordinary £1 shares with an exercise price of £1.03, £1.20 or £1.69.

The 'Employee' options are exercisable in the event of the company achieving an exit event with Exit Proceeds not less than £2,774,424.

The number of shares granted for 'Others' is 6,920 ordinary £1 shares with an exercise price of £9.375 and £11.54.

Share options in respect of 'Others' apply to investors who have undertaken work for the company and were granted on 28 January 2013, 8 February 2013, 15 January 2015 and 3 June 2016. 3,200 of these options are exercisable at any time and do not have an expiry date; 3,720 of these options are exercisable in the event of the company achieving an exit event. The exercise price is £9.375 and £11.54.

Warrants

Warrants have been granted to Equity Gap Limited and Tri Capital Limited by virtue of an instrument dated 22 October 2019 replacing the previous instrument dated 14 February 2013. The warrants give Equity Gap Limited and Tri Capital Limited the option to subscribe for up to 0.5% of the fully diluted equity share capital of the Company subject to a maximum value equal of £25,000.

10.	POST BALANCE SHEET EVENTS

After the year end, the company raised £404,042 by issuing shares to investors.