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Registered number: 13217038
PEMBRIDGE PRIVATE CAPITAL LTD
DIRECTOR'S REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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PEMBRIDGE PRIVATE CAPITAL LTD
Company Information
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PEMBRIDGE PRIVATE CAPITAL LTD
Contents
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Independent Auditors' Report
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Consolidated Statement of Comprehensive Income
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Consolidated Balance Sheet
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Consolidated Statement of Changes in Equity
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Company Statement of Changes in Equity
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Consolidated Statement of Cash Flows
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Consolidated Analysis of Net Debt
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Notes to the Financial Statements
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PEMBRIDGE PRIVATE CAPITAL LTD
Group Strategic Report
For the Year Ended 31 December 2022
The director presents his strategic report for the year ended 31 December 2022.
Pembridge Private Capital Ltd ("the Company") and its group are investment companies. During the year the group invested in property, listed and unlisted investments with a view to generating future gains. The director is happy with the performance of the overall portfolio in the year, both in respect of dividends received, amounting to £25m (period ended 31 December 2021: £21m), but also gains in market value, amounting to £93m (period ended 31 December 2021: £106m).
Principal risks and uncertainties
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The group's main risks are:
Foreign Currency risk
The group operates in Sterling and Euros, and monitors fluctuations in foreign exchange rates regularly. The director does not consider it necessary to hedge against this risk.
Investment risk
The company is subject to fluctuations in the value of listed investments. The director manages the company's portfolio of investments carefully, and is open to further investment opportunities to continue to diversify the company's portfolio and manage this risk.
Liquidity risk
The group is not significantly exposed to liquidity risk, due to the maintenance of sufficient cash and equivalents to meet the necessary outflows of the business.
Financial key performance indicators
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The key performance indicator of the group is return on investment. This is measured by way of dividend yield and market value of the investments held.
This report was approved by the board on 26 September 2023 and signed on its behalf.
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PEMBRIDGE PRIVATE CAPITAL LTD
Director's Report
For the Year Ended 31 December 2022
The director presents his report and the financial statements for the year ended 31 December 2022.
The profit for the year, after taxation, amounted to £153,187 thousand (2021 - £129,515 thousand).
No ordinary dividends were paid. The director does not recommend the payment of a final dividend.
The director who served during the year was:
Director's responsibilities statement
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The director is responsible for preparing the Group Strategic Report, the Director's Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 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 the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the director is required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments 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 Group 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 the Group and to enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Post year-end the group continued to actively manage its investment portfolio and continues to investigate new investment opportunities as they arise.
Matters covered in the Group Strategic Report
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Items of strategic nature which would normally be included in the director's report have been set out in the strategic report.
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PEMBRIDGE PRIVATE CAPITAL LTD
Director's Report (continued)
For the Year Ended 31 December 2022
Disclosure of information to auditors
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The director at the time when this Director's Report is approved has confirmed that:
∙so far as he is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and
∙he has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.
Post balance sheet events
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Significant events affecting the Group since the year-end have been disclosed in note 21.
The auditors, Moore Kingston Smith LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board on 26 September 2023 and signed on its behalf.
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PEMBRIDGE PRIVATE CAPITAL LTD
Independent Auditors' Report to the Members of Pembridge Private Capital Ltd
We have audited the financial statements of Pembridge Private Capital Ltd (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2022, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity, the Consolidated Statement of Cash Flows and notes to the financial statements, including 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 Group's and of the parent Company's affairs as at 31 December 2022 and of the Group's 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 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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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
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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 Group's or the parent 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.
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PEMBRIDGE PRIVATE CAPITAL LTD
Independent Auditors' Report to the Members of Pembridge Private Capital Ltd (continued)
The other information comprises the information included in the Annual Report other than the financial statements and our thereon. The director is responsible for the other information contained within the Annual Report. 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.
Opinion on other matters prescribed by the Companies Act 2006
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In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group 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 Group Strategic Report and the Director's Report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
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In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
∙the parent Company 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.
Responsibilities of directors
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As explained more fully in the Director's Responsibilities Statement set out on page 2, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.
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PEMBRIDGE PRIVATE CAPITAL LTD
Independent Auditors' Report to the Members of Pembridge Private Capital Ltd (continued)
Auditors' responsibilities for the audit of the financial statements
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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 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 Group financial statements.
As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the
group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the group’s or the parent company’s ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the group or the parent company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures,
and whether the financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the group to express an opinion on the consolidated financial statements. We are responsible for
the direction, supervision and performance of the group audit. We remain solely responsible for our audit
opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
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PEMBRIDGE PRIVATE CAPITAL LTD
Independent Auditors' Report to the Members of Pembridge Private Capital Ltd (continued)
Explanation as to what extent the audit was considered 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:
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.
Our approach was as follows:
• We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that the most significant are the Companies Act 2006, UK financial reporting standards as issued by the Financial Reporting Council, and UK taxation legislation
• We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.
• We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
• We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.
• Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, 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 or intentional misrepresentations, or through collusion.
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PEMBRIDGE PRIVATE CAPITAL LTD
Independent Auditors' Report to the Members of Pembridge Private Capital Ltd (continued)
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 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.
Ian Matthews (Senior Statutory Auditor)
for and on behalf of
Moore Kingston Smith LLP
Betchworth House
57 - 65 Station Road
Redhill
RH1 1DL
26 September 2023
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PEMBRIDGE PRIVATE CAPITAL LTD
Consolidated Statement of Comprehensive Income
For the Year Ended 31 December 2022
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Share of profit of associates
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Profit on disposal of investments
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Interest receivable and similar income
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Interest payable and similar expenses
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Profit for the financial year
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Currency translation differences arising on consolidation
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Other comprehensive income for the year
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Profit for the year attributable to:
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Owners of the parent Company
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The notes on pages 18 to 32 form part of these financial statements.
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PEMBRIDGE PRIVATE CAPITAL LTD
Registered number: 13217038
Consolidated Balance Sheet
As at 31 December 2022
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Debtors: amounts falling due after more than one year
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Provisions for liabilities
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Equity attributable to owners of the parent Company
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The financial statements were approved and authorised for issue by the board and were signed on its behalf on 26 September 2023.
The notes on pages 18 to 32 form part of these financial statements.
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PEMBRIDGE PRIVATE CAPITAL LTD
Registered number: 13217038
Company Balance Sheet
As at 31 December 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Provisions for liabilities
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Profit and loss account brought forward
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PEMBRIDGE PRIVATE CAPITAL LTD
Registered number: 13217038
Company Balance Sheet (continued)
As at 31 December 2022
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 26 September 2023.
The notes on pages 18 to 32 form part of these financial statements.
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PEMBRIDGE PRIVATE CAPITAL LTD
Consolidated Statement of Changes in Equity
For the Year Ended 31 December 2022
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Comprehensive income for the period
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Total comprehensive income for the period
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Comprehensive income for the year
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Currency translation differences arising on consolidation
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Total comprehensive income for the year
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The notes on pages 18 to 32 form part of these financial statements.
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PEMBRIDGE PRIVATE CAPITAL LTD
Company Statement of Changes in Equity
For the Year Ended 31 December 2022
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Comprehensive income for the period
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Total comprehensive income for the period
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Comprehensive income for the period
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Total comprehensive income for the year
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The notes on pages 18 to 32 form part of these financial statements.
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PEMBRIDGE PRIVATE CAPITAL LTD
Consolidated Statement of Cash Flows
For the Year Ended 31 December 2022
Cash flows from operating activities
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Profit for the financial year
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Profit on disposal of investments
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Net fair value gains recognised in P&L
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Share of operating (loss) in associates
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Corporation tax repayable
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Net cash generated from operating activities
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PEMBRIDGE PRIVATE CAPITAL LTD
Consolidated Statement of Cash Flows (continued)
For the Year Ended 31 December 2022
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Cash flows from investing activities
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Purchase of investment properties
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Sale of listed investments
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Net cash from investing activities
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Cash flows from financing activities
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Net cash used in financing activities
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Net increase in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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PEMBRIDGE PRIVATE CAPITAL LTD
Consolidated Analysis of Net Debt
For the Year Ended 31 December 2022
The notes on pages 18 to 32 form part of these financial statements.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
Pembridge Private Capital Ltd. (the "Company") is a private company limited by share capital, incorporated in the United Kingdom, registered in England and Wales with registration number 13217038. The registered office address is The Scalpel, 18th Floor, 52 Lime Street, London, United Kingdom, EC3M 7AF.
The principal activity of the group was that of investment.
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 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 Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
Financial reporting standard 102 - reduced disclosure exemptions in preparing the separate financial statements of the parent company, advantage has been taken of the following disclosure exemptions available in FRS 102:
•Only one reconciliation of the number of shares outstanding at the beginning and end of the year has been presented as the reconciliation for the group and the parent company would be identical;
• No statement of Cash Flows has been presented for the parent company;
• Disclosures in respect of the parent company's financial instruments have not been presented as equivalent disclosures have been provided in respect of the group as a whole; and
• No disclosures have been given for the aggregate remuneration of the key management personnel of the parent company as their remuneration is included in the totals for the group as a whole.
The following principal accounting policies have been applied:
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
2.Accounting policies (continued)
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
PPC Racing Holdings Ltd., PPC Energy Ltd., and PPC Art Limited have claimed exemption from audit under the provisions of section 479A of the Companies Act 2006. Pembridge Private Capital Ltd. has provided a guarantee over the liabilities of PPC Racing Holdings Ltd., PPC Energy Ltd., and PPC Art Limited under section 479C of the Act.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP. These accounts have been prepared rounding to the nearest thousand.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
On consolidation the results of group companies are translated into sterling using the average rate for the year. All assets and liabilities of group companies are translated at the rate ruling at the reporting date. Exchange differences arising on the retranslation of opening net assets at opening rate, and the results of the group companies at average rate, are recognised in other comprehensive income.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable. Turnover represents dividends received from investments, and is recognised once their is a legal obligation for the dividend to be paid.
Rental income is recognised in accordance with the underlying lease, net of Value Added Tax.
Interest income is recognised in profit or loss using the effective interest method.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
2.Accounting policies (continued)
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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 and the Group operate and generate 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;
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
∙Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.
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.
Investment property is carried at fair value determined annually by the director derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.
Investments in subsidiaries and unlisted investments whose market value cannot be reliably determined are measured at cost less accumulated impairment.
Investments in unlisted Group shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.
Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in profit or loss for the period.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
2.Accounting policies (continued)
An entity is treated as an associated undertaking where the Group exercises significant influence in that it has the power to participate in the operating and financial policy decisions.
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The Consolidated Statement of Comprehensive Income includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated Balance Sheet, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
The Group enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
2.Accounting policies (continued)
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Financial instruments (continued)
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Investments in non-derivative instruments that are equity to the issuer are measured:
∙at fair value with changes recognised in the Consolidated Statement of Comprehensive Income if the shares are publicly traded or their fair value can otherwise be measured reliably;
∙at cost less impairment for all other investments.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Statement of Comprehensive Income.
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.
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 income as appropriate. The company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.
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Judgments in applying accounting policies and key sources of estimation uncertainty
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In the application of the group’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and 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 review on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or the period of the revision an future periods if the revision affects both current and future periods.
The estimates and assumptions which have a risk of causing a material adjustment to the carrying value of assets are liabilities are outlined below.
Critical judgements
Carrying value of investments
When assessing the carrying value of investments in subsidiaries and associates, the directors consider the ability of entity to generate profits in the longer term and consider any subsequent impairment to carrying value deemed necessary.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Dividends from UK listed investments
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All turnover arose within the United Kingdom.
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The operating profit is stated after charging:
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During the year, the Group obtained the following services from the Company's auditors:
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Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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The average monthly number of employees, including the director, during the year was as follows:
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Other interest receivable
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Interest payable and similar expenses
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Current tax on profits for the period
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Origination and reversal of timing differences
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Taxation on profit on ordinary activities
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Factors affecting tax charge for the year/period
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The tax assessed for the year/period is higher than (2021 - lower than) the standard rate of corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021 - 19%)
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Total tax charge for the year/period
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Factors that may affect future tax charges
On 24 May 2021, proposals to increase the main rate of corporation tax from 19% to 25% with effect from 1 April 2023 were enacted into UK law.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Investments in associates
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On 16 February 2022, a subsidiary issued a loan to the entity included in unlisted investments above for the sum of €5m. The loan is repayable in full in two years from the date of the agreement, as shown in note 13.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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The following are subsidiaries of the Company.
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The Scalpel, 18th Floor, 52 Lime Street, London, United Kingdom, EC3M 7AF
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The Scalpel, 18th Floor, 52 Lime Street, London, United Kingdom, EC3M 7AF
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12 Gough Square, London, United Kingdom, EC4A 3DW
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Freehold investment property
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The 2022 valuations were made by the director, on an open market value for existing use basis.
There is no difference between the year-end valuation and historic cost.
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Due after more than one year
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Amounts owed by group undertakings
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Cash and cash equivalents
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Accruals and deferred income
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On 1 March 2021 the Company issued 552,330,000 £1 unsecured loan notes to the director and shareholder of the Company. The loan notes are redeemable by the Company with 10 business days' notice to the noteholder. No interest is charged on the loan notes. By the year end, 300,730,170 (2021: 62,029,546) loan notes had been redeemed.
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Financial assets measured at fair value through profit or loss
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Derivative financial instruments measured at fair value through profit or loss held as part of a trading portfolio
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Financial assets measured at fair value through profit or loss comprise listed investments detailed in note 11. The total amount recognised in the profit and loss relating to fair value gains on those financial assets was £75.4m (2021: £123.6m).
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Other financial liabilities measured at fair value through profit and loss comprise derivative equity put options over the listed investments held by the Company. The total amount recognised in the profit and loss relating to fair value gains (2021: losses) on those financial liabilities was £17.1m (2021: £17.8m).
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Charged to profit or loss (see note 10)
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The provision for deferred taxation is made up as follows:
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Unrecognised gains on investments
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Allotted, called up and fully paid
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1 (2021 - 1) Ordinary share of £1.00
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19.Other financial commitments
A subsidiary entered an agreement on 2 December 2021 to purchase warrant shares in an unrelated entity. The warrants allow the subsidiary to provide a loan facility of up to £9m to the issuer.
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Related party transactions
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The Company has adopted the exemption permitted by paragraph 33.1A of FRS 102 and has not disclosed transactions with other group members, where the group members are wholly owned.
As detailed in note 15, the Company issued loan notes to the sole director and shareholder during the prior period, some of which were redeemed during the year.
The company operates a directors current account. The director paid the company interest amounting to £37.5k during the year (2021: £9.6k). £27.4k was repaid during the year (2021: £nil). The balance outstanding at the year end was £1.9m (2021: £1.9m).
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PEMBRIDGE PRIVATE CAPITAL LTD
Notes to the Financial Statements
For the Year Ended 31 December 2022
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Post balance sheet events
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Following the year end, in April 2023, warrant share were purchased in relation to the agreement mentioned in note 19, amounting to £3.5m.
Following the year end, in May 2023, a subsidiary company increased its investment in the entity included in investments in associates in note 11 by €2.2m.
The ultimate controlling party of the Company is A F Beard.
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