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Registered number: 08964152
THE BIG EXCHANGE LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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THE BIG EXCHANGE LIMITED
CONTENTS
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Statement of changes in equity
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Notes to the financial statements
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THE BIG EXCHANGE LIMITED
COMPANY INFORMATION
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REGISTERED NUMBER:08964152
THE BIG EXCHANGE LIMITED
BALANCE SHEET
AS AT 31 MARCH 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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Net current (liabilities)/assets
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Total assets less current liabilities
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Provisions for liabilities
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REGISTERED NUMBER:08964152
THE BIG EXCHANGE LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 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 profit and loss account 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 by:
The notes on pages 5 to 13 form part of these financial statements.
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THE BIG EXCHANGE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2021
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Comprehensive loss for the year
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Loss for the financial year
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Total comprehensive loss for the year
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Shares issued during the year
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Total transactions with owners
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At 31 March 2020 and 1 April 2020
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Comprehensive loss for the year
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Loss for the financial year
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Total comprehensive loss for the year
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Shares issued during the year
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Total transactions with owners
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
The Big Exchange Limited is a private company limited by shares incorporated in England and Wales. The address of its registered office is 113-115 Fonthill Road, London, N4 3HH.
The financial statements are presented in Sterling (£).
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 preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the company's accounting policies (see note 3).
The company is the parent undertaking of a small group and as such is not required by the Companies Act 2006 to prepare group accounts. These financial statements therefore present information about the company as an individual and not about its group.
The following principal accounting policies have been applied:
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.Accounting policies (continued)
The company is subject to a number of risks similar to those of other development stage investment platform companies. These risks include, amongst others, generation of revenues from the successful build and launch of the investment platform together with an integrated mobile application. The platform has had a soft launch recently ahead of schedule in advance of the Individual Savings Account (ISA) transfer season. Ultimately, the realisation of profitable operations is dependent on future uncertain events which include obtaining adequate financing to fulfil the company’s commercial and development activities and generating a level of revenue adequate to support the company’s cost structure.
The company has reported an operating loss for the year. These losses will continue in the current accounting year to 31 March 2022.
The company has carried out regular fund-raising exercises to date in order to provide the necessary capital for the company. The directors expect to continue to raise additional funding as and when required to cover the company’s development, primarily from issue of further shares or convertible loans to finance the company’s work programme. Should future fund raisings be lower than anticipated the directors will reduce expenditure as necessary.
The directors have prepared financial forecasts and cash flows looking beyond twelve months from the date of the approval of these financial statements. In developing these forecasts, the directors have made assumptions based on their view of the current and future economic conditions that are expected to prevail over the forecast period. The directors estimate that the cash held by the company together with known receivables will be sufficient to support the current level of activities for not less than the twelve months from the date of approval of these financial statements. The directors are continuing to explore sources of finance available to the company and based upon initial discussions with a number of existing and potential investors they have a reasonable expectation that they will be able to secure sufficient cash inflows for the company. The directors have a reasonable expectation that the company will have adequate resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date of approval of these financial statements. Accordingly, they have therefore prepared the financial statements on a going concern basis.
Other income is recognised to the extent that it is probable that the economic benefits will flow to the company and the other income can be reliably measured. Other income comprises irrevocable gifts and is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Turnover includes management fees, calculated monthly on the actual value of assets under management.
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.
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.Accounting policies (continued)
Defined contribution pension plan
The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
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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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 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.
Investments in subsidiaries are measured at cost less accumulated impairment.
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.
The company has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.
Financial assets and financial liabilities are recognised when the company becomes party to the contractual provisions of the instrument.
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.
The company’s policies for its major classes of financial assets and financial liabilities are set out below.
Financial assets
Basic financial assets, including cash and bank balances are initially recognised at transaction price, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment.
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.Accounting policies (continued)
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Financial instruments (continued)
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Financial liabilities
Basic financial liabilities, including trade and other creditors, other loans 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Impairment of financial assets
Financial assets 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 profit and loss account.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the company would receive for the asset if it were to be sold at the reporting date.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the 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.
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.
Derecognition of financial assets and financial liabilities
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.Accounting policies (continued)
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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 balance sheet 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 balance sheet.
Ordinary shares are classified as equity.
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Judgments in applying accounting policies and key sources of estimation uncertainty
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Valuation of convertible loans
During 2021 the company issued £380,000 of convertible loan notes and the directors have concluded that the instrument qualifies as a complex financial instrument under FRS102 Sections 11 and 12. Accordingly, they are included in the Balance Sheet at fair value of £475,000, determined based on the actual market value of equity instruments upon conversion on 20 December 2021. The fair value movement has been recognised in the profit and loss account.
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The average monthly number of employees, including directors, during the year was 5 (2020 - 3).
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
5.Intangible assets (continued)
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The intangible asset relates to the development of a trading platform focused around sustainable investing. This was still in development at the year end and subsequently no amortisation has been applied. The intangible asset is expected to be ready for use during the year ending 31 March 2022.
The directors anticipate that the trading platform will generate revenues when ready for use, and therefore it is reasonable to carry the development expenditure as an intangible asset at cost, without impairment. The directors will continue to review the carrying value of the intangible asset going forward.
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Investments in subsidiary companies
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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Called up share capital not paid
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Prepayments and accrued income
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Creditors: amounts falling due within one year
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Amounts owed to group undertakings
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Accruals and deferred income
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Other creditors at 31 March 2021 comprise convertible loan notes issued by the company during the year and are stated at the fair value of equity instruments issued upon conversion on 20 December 2021 as set out in note 12.
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THE BIG EXCHANGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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Charged to profit or loss
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The deferred taxation balance is made up as follows:
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Accelerated capital allowances
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Shares classified as equity
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Allotted, called up and fully paid
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5,865,918 (2020 - 5,420,000) Ordinary shares of £ 0.0010
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The company issued 445,918 Ordinary shares of £0.001 each at £1 per share during the year, raising proceeds of £480,087.
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Post balance sheet events
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On 20 December 2021, convertible loan notes were converted into ordinary shares, and included within the issue of 613,513 ordinary shares for a consideration of £744,014.
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