Finglow Limited - Limited company accounts 20.1

REGISTERED NUMBER: 01623997 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 31 December 2020

for

Finglow Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Income Statement

9

Other Comprehensive Income

10

Balance Sheet

11

Statement of Changes in Equity

12

Cash Flow Statement

13

Notes to the Cash Flow Statement

14

Notes to the Financial Statements

15

DIRECTORS:

Ms C Marks

G Czegledy

REGISTERED OFFICE:

5th Floor 10 Finsbury Square

London

EC2A 1AF

REGISTERED NUMBER:

01623997 (England and Wales)

AUDITORS:

Fisher Michael Chartered Accountants

The Old Grange

Warren Estate

Lordship Road

Writtle

Essex

CM1 3WT

The directors present their strategic report for the year ended 31 December 2020.

Finglow is a supplier of software specialising in the industrial sector, specifically for pressure vessel and heat exchanger code compliance. The company has established a reputation for delivering high quality services to customers from both the private and public sector.

The company is committed to developing strong teams, both internally and with external organisations, to work collaboratively to deliver software to meet the demands of clients

REVIEW OF BUSINESS

Despite the effects of the on-going pandemic, the directors are pleased to report on a profitable year for the company with a pre-tax profit for the year of £230,112 when removing exceptional one off costs.

When reanalysing the 2019 16 month period as a comparable 12 month period, turnover fell by only 7.8% which is positive, considering the pandemic.

The company has managed to perform well throughout the course of the financial year as a direct result of significantly reducing overhead expenditure. This represents a clear change from the prior year where the company had pre-tax losses of £89,467.

The balance sheet and cash position remain strong, putting the group in a good position to continue with its development and operations.

The company's functions and controls are centrally operated by its parent company and therefore overhead costs have drastically reduced this year.

The company's customer base remains varied with no reliance on any one customer

The company continues to operate in a range of key market sectors including: Oil & Gas, Food & Pharmaceutical, Shipbuilding, Heavy Equipment and Heating & Cooling

PRINCIPAL RISKS AND UNCERTAINTIES

Principal Risks to the business can be categorised as follows:

Coronavirus: The uncertain nature of the virus provides a huge challenge across all aspects of the group. The management regimes implemented to minimise the risks to both health and safety of all stakeholders as well as productivity levels are being constantly reviewed and updated to reflect the changing nature of the risks.

Supply chain performance: As the rights to the software being sold, are held by the parent company, the supply chain has no significant risk.

Competition: The businesses current core market has had a relatively limited number of suppliers against whom the company competes with however, the strongest North American competitor lacks the PD5500 and EN13445 code depth that Finglow Ltd have. In Europe the strongest competitor's strength is in EN code, however, they are at least 50% engineering professional services and are an active customer of Finglow Ltd's PD5500 package.

Delivering sustained growth: Risk of not securing sufficient sales to meet Business Plan Growth objectives. Regular monitoring of Business Growth achievements and delivery for key customers will negate this by ensuring sufficient forward workload.

FUTURE DEVELOPMENTS

Although market conditions are extremely challenging, the directors are optimistic that the work carried out in recent years will enable the company to capitalise on the opportunities to grow the business whilst maintaining the requisite level of return.

To support growth plans the company has continued to invest and develop systems to support all aspects of the business.

CORPORATE SOCIAL RESPONSIBILITY

Finglow recognises the responsibilities it has in reducing the impact it has on the environment by minimising its office footprint and travel. The company supports remote work in the global community.

It promotes Safety, Health, Environment and Quality through the company ethos and this is reinforced by management systems which are compliant with UK governance.

Staff engagement, equality, diversity, training and development are all core values within the business, and these are reinforced by practices such as regular group meetings engaging all members, supervisor 1:1 meetings and performance reviews, blind hiring process, and existing diverse staff.

The directors believe that the shareholders will use the return provided to them to support the charities that are important to them and their localised needs.

ON BEHALF OF THE BOARD:

Ms C Marks - Director

22 December 2021

The directors present their report with the financial statements of the company for the year ended 31 December 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of software sales.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2020.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2020 to the date of this report.

Ms C Marks

G Czegledy

Other changes in directors holding office are as follows:

J Taub ceased to be a director after 31 December 2020 but prior to the date of this report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

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

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company 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 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Fisher Michael Chartered Accountants, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Ms C Marks - Director

22 December 2021

Opinion

We have audited the financial statements of Finglow Limited (the 'company') for the year ended 31 December 2020 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2020 and of its loss 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.

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

Conclusions relating to going concern

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 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.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors 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.

In connection with our audit of the financial statements, 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 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.

Opinions on other matters prescribed by the Companies Act 2006

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

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

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 Report of the Directors.

We have nothing to report in respect of the following matters where 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 directors' remuneration specified by law are not made; or

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are 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 directors determine 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 directors are 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 directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

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 a Report of the Auditors 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates and considered the risk of the company of not complying with such laws and regulations, including fraud, where non-compliance could have a material impact on the financial statements. This included those regulations directly related to the financial statements, including financial reporting and tax legislation.

The risks were discussed with the audit team and we remained alert to any indications of non-compliance throughout the audit. We carried out specific procedures to address the risks identified as follows:

- Review of the control environment

- Contacting key personal responsible for specific functions relating to laws and regulations

- Review of legal fees incurred

- Agreeing the financial statement disclosures to underlying supporting documentation

- Reviewing the key accounting policies and estimates

To address the risk of management override of controls, we carried out testing of journal entries and other adjustments for appropriateness and evaluated the business rationale of significant transactions outside of the normal course of business.

Because of the inherent limitations of an audit there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion and misrepresentation.

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 Report of the Auditors.

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 a Report of the Auditors 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.

Andrea Kaley (Senior Statutory Auditor)

for and on behalf of Fisher Michael Chartered Accountants

The Old Grange

Warren Estate

Lordship Road

Writtle

Essex

CM1 3WT

22 December 2021

TURNOVER

3

290,900

420,742

Cost of sales

-

312

GROSS PROFIT

290,900

420,430

Administrative expenses

60,620

534,415

230,280

(113,985

)

Other operating income

-

24,276

OPERATING PROFIT/(LOSS)

5

230,280

(89,709

)

Write off of intangible assets

6

263,079

-

(32,799

)

(89,709

)

Interest receivable and similar income

-

591

(32,799

)

(89,118

)

Interest payable and similar expenses

7

168

349

LOSS BEFORE TAXATION

(32,967

)

(89,467

)

Tax on loss

8

14,751

-

LOSS FOR THE FINANCIAL YEAR

(47,718

)

(89,467

)

LOSS FOR THE YEAR

(47,718

)

(89,467

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(47,718

)

(89,467

)

FIXED ASSETS

Intangible assets

10

-

222,514

CURRENT ASSETS

Debtors

11

297,695

132,883

Cash at bank

26,574

15,936

324,269

148,819

CREDITORS

Amounts falling due within one year

12

297,995

297,341

NET CURRENT ASSETS/(LIABILITIES)

26,274

(148,522

)

TOTAL ASSETS LESS CURRENT LIABILITIES

26,274

73,992

CAPITAL AND RESERVES

Called up share capital

13

100

100

Retained earnings

14

26,174

73,892

SHAREHOLDERS' FUNDS

26,274

73,992

The financial statements were approved by the Board of Directors and authorised for issue on 22 December 2021 and were signed on its behalf by:

Ms C Marks - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 September 2018

100

740,359

740,459

Changes in equity

Dividends

-

(577,000

)

(577,000

)

Total comprehensive income

-

(89,467

)

(89,467

)

Balance at 31 December 2019

100

73,892

73,992

Changes in equity

Total comprehensive income

-

(47,718

)

(47,718

)

Balance at 31 December 2020

100

26,174

26,274

Cash flows from operating activities

Cash generated from operations

1

266,921

13,518

Interest paid

(168

)

(349

)

Net cash from operating activities

266,753

13,169

Cash flows from investing activities

Purchase of intangible fixed assets

-

(263,079

)

Sale of tangible fixed assets

-

1,000

Sale of fixed asset investments

-

361,891

Interest received

-

591

Net cash from investing activities

-

100,403

Cash flows from financing activities

Movement on related party loans

(256,115

)

101,759

Movement on group loans

-

51,372

Amount withdrawn by directors

-

(14,154

)

Equity dividends paid

-

(577,000

)

Net cash from financing activities

(256,115

)

(438,023

)

Increase/(decrease) in cash and cash equivalents

10,638

(324,451

)

Cash and cash equivalents at beginning of year

2

15,936

340,387

Cash and cash equivalents at end of year

2

26,574

15,936

1.	RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Loss before taxation

(32,967

)

(89,467

)

Depreciation charges

(40,565

)

42,614

Loss on disposal of fixed assets

-

410

Disposal of intangibles

263,079

-

Finance costs

168

349

Finance income

-

(591

)

189,715

(46,685

)

Decrease/(increase) in trade and other debtors

25,189

(6,007

)

Increase in trade and other creditors

52,017

66,210

Cash generated from operations

266,921

13,518

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2020

31.12.20

1.1.20

£

£

Cash and cash equivalents

26,574

15,936

Period ended 31 December 2019

31.12.19

1.9.18

£

£

Cash and cash equivalents

15,936

340,387

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.20

Cash flow

At 31.12.20

£

£

£

Net cash

Cash at bank and in hand

15,936

10,638

26,574

15,936

10,638

26,574

Total

15,936

10,638

26,574

1.	STATUTORY INFORMATION

Finglow 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.

The company is part of a group.

The current period ended 31 December 2020 covers a 12 month period and the comparative information covers a 16 month period, therefore, the figures are not directly comparable.

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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Significant judgements and estimates

No significant judgements or estimations have been applied in the preparation of the financial statements.

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales tax.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2019, has been written off in full in the current financial year.

Intangible assets

Intellectual property and customer relationships, acquired in 2019 have been written off in full in the current financial year.

Financial instruments

The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, and loans to and from related parties.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

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.

Debtors

Short term debtors are measured at transaction price, less any impairment.

Creditors

Short term creditors are measured at transaction price.

3.

TURNOVER

The turnover and loss before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

United Kingdom

242,454

345,821

Europe

22,201

43,777

United States of America

8,315

8,142

South America

2,657

-

Asia

7,510

11,491

RoW

7,763

11,511

290,900

420,742

4.	EMPLOYEES AND DIRECTORS

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Wages and salaries

57,330

97,051

Social security costs

6,705

10,495

Other pension costs

4,587

7,127

68,622

114,673

The average number of employees during the year was as follows:

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

Directors

3

3

Admin

1

2

4

5

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Directors' remuneration

-

-

5.	OPERATING PROFIT/(LOSS)

The operating profit (2019 - operating loss) is stated after charging/(crediting):

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Depreciation - owned assets

-

2,048

Loss on disposal of fixed assets

-

410

Patents and licences amortisation

(40,565

)

40,565

Auditors' remuneration

2,500

-

Foreign exchange differences

5,560

(3,728

)

6.	EXCEPTIONAL ITEMS

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Write off of intangible assets

(263,079

)

-

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Bank charges and interest

168

349

8.

TAXATION

Analysis of the tax charge

The tax charge on the loss for the year was as follows:

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Current tax:

UK corporation tax

14,751

-

Tax on loss

14,751

-

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Loss before tax

(32,967

)

(89,467

)

Loss multiplied by the standard rate of corporation tax in the UK of 19% (2019 - 19%)

(6,264

)

(16,999

)

Effects of:

Depreciation in excess of capital allowances

44,084

14,020

Utilisation of tax losses

(23,069

)

-

Losses carried forward

-

2,979

Total tax charge

14,751

-

9.

DIVIDENDS

Period

1.9.18

Year Ended

to

31.12.20

31.12.19

£

£

Ordinary shares of £1 each

Interim

-

577,000

10.	INTANGIBLE FIXED ASSETS

Patents

and

Goodwill

licences

Totals

£

£

£

COST

At 1 January 2020

80,469

182,610

263,079

Disposals

(80,469

)

(182,610

)

(263,079

)

At 31 December 2020

-

-

-

AMORTISATION

At 1 January 2020

-

40,565

40,565

Amortisation for year

-

(40,565

)

(40,565

)

At 31 December 2020

-

-

-

NET BOOK VALUE

At 31 December 2020

-

-

-

At 31 December 2019

80,469

142,045

222,514