Warwick Audio Technologies Limited - Abbreviated accounts 16.3

REGISTERED NUMBER: 04451674 (England and Wales)

WARWICK AUDIO TECHNOLOGIES LIMITED

ABBREVIATED UNAUDITED ACCOUNTS

FOR THE YEAR ENDED 30 SEPTEMBER 2016

Page

Company Information

1

Abbreviated Balance Sheet

2

to

3

Notes to the Abbreviated Accounts

4

to

6

Chartered Accountants' Report

7

DIRECTORS:

Dr D R Billson

Dr M A Grant

R J Kendrick

Mercia Fund Management (Nominees) Limited

D S Mottershead

M A Roberts

REGISTERED OFFICE:

Forward House

17 High Street

Henley In Arden

Warwickshire

B95 5AA

REGISTERED NUMBER:

04451674 (England and Wales)

ACCOUNTANTS:

Duncan & Toplis Limited

The Gables

Bishop Meadow Road

Loughborough

Leicestershire

LE11 5RE

BANKERS:

Barclays Bank Plc

150 Parade

Leamington Spa

Warwickshire

CV32 4AG

FIXED ASSETS

Intangible assets

2

783,424

-

Tangible assets

3

40,993

3,974

Investments

4

-

824,417

3,974

CURRENT ASSETS

Stocks

99,819

43,000

Debtors

250,871

117,908

Cash at bank

122,281

57,809

472,971

218,717

CREDITORS

Amounts falling due within one year

5

305,703

476,666

NET CURRENT ASSETS/(LIABILITIES)

167,268

(257,949

)

TOTAL ASSETS LESS CURRENT LIABILITIES

991,685

(253,975

)

CAPITAL AND RESERVES

Called up share capital

6

74,981

13,930

Share premium

7,488,519

5,625,133

Profit and loss account

(6,571,815

)

(5,893,038

)

991,685

(253,975

)

The company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 30 September 2016.

The members have not required the company to obtain an audit of its financial statements for the year ended 30 September 2016 in accordance with Section 476 of the Companies Act 2006.

The directors acknowledge their responsibilities for:

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

(b)

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

The abbreviated accounts have been prepared in accordance with the special provisions of Part 15 of the Companies Act 2006 relating to small companies.

The financial statements were approved by the Board of Directors on 5 June 2017 and were signed on its behalf by:

Dr M A Grant - Director

1.	ACCOUNTING POLICIES

Accounting convention

The financial statements have been prepared under the historical cost convention and in accordance with the

Financial Reporting Standard for Smaller Entities (effective January 2015).

The company continues in its early stage strategy with the ultimate aim of delivering outstanding HiResTM

Audio experiences to the widest possible audience through the supply of a new type of low cost Electrostatic

planar speaker, the High Precision Electrostatic Laminate (HPEL) together with the associated electronic to

drive the speaker.

In line with this strategy the company identified its first target segment as the headphone market, and

specifically the audiophile segment. During 2016 they developed a high value marketable product which

gained a very positive response in the market place. The manufacture of this product commenced post year

end with the first sales being made in April 2017.

In January 2017 Warwick Audio Technologies successfully completed a structured funding round, including a

significant amount from new investors, having delivered key commercial objectives set by investors as a

condition for the completion of the round.

At present, they are in advanced discussions to secure further financing to support the next phase of the

company's strategy.

The directors considered a period in excess of 12 months from the date of approval of the financial statements

when making this assessment and consider that in preparing the financial statements, they have taken into

account all information that could reasonably be expected to be available.

On this basis they consider that it is appropriate to prepare the financial statements on the going concern

basis.

Turnover

Turnover represents net invoiced sales of goods, excluding value added tax.

Tangible fixed assets

Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates calculated to write

off the cost less estimated residual value of each asset over its expected useful life, as follows:

Office construction

Straight line over 24 months

Tooling

Straight line over 18 months

Other assets

Straight line over 36 months

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and

slow moving items.

Deferred tax

No deferred tax asset has been provided for on the basis that it is not anticipated that the asset will be realised

in the foreseeable future.

Research and development

Research expenditure is written off to the profit and loss account in the year in which it is incurred.

Development expenditure is written off in the same way unless the directors are satisfied as to the technical,

commercial and financial viability of individual projects. In this situation, the expenditure is deferred and

amortised over the period during which the company is expected to benefit.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the

balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange

ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating

result.

Compliance with accounting standards

The financial statements are prepared in accordance with applicable United Kingdom Accounting Standards

(United Kingdom Generally Accepted Accounting Practice), which have been applied consistently (except as

otherwise stated).

Share-based payments

The company has issued share options to certain directors and employees. These financial statements have

been prepared in accordance with Financial Reporting Standard for Small Entities which does not require

equity-settled share based payment arrangements to be recognised as an expense.

Intangible fixed assets

Intangible fixed assets are stated at cost less amortisation. Amortisation is provided at rates calculated to write

off the cost of each asset over its expected useful life, as follows:

Development costs

Straight line over 8 years

2.	INTANGIBLE FIXED ASSETS

Total

£

COST

Additions

783,424

At 30 September 2016

783,424

NET BOOK VALUE

At 30 September 2016

783,424

3.	TANGIBLE FIXED ASSETS

Total

£

COST

At 1 October 2015

120,456

Additions

49,009

At 30 September 2016

169,465

DEPRECIATION

At 1 October 2015

116,482

Charge for year

11,990

At 30 September 2016

128,472

NET BOOK VALUE

At 30 September 2016

40,993

At 30 September 2015

3,974

4.	FIXED ASSET INVESTMENTS

The company's investments at the Balance Sheet date in the share capital of companies include the following:

Zonarsound Limited which was incorporated on 15 March 2013, a 100% owned subsidiary. The year end of

Zonarsound is 31st March, which has not been updated because the company has been dormant since

incorporation.

Sonoma Acoustics Limited which was incorporated on 2 August 2016, a 100% owned subsidiary. The year end

of Sonoma Acoustics is 31st August, the company has been dormant since incorporation.

5.

CREDITORS

Creditors include an amount of £ 150,000 for which security has been given.

6.	CALLED UP SHARE CAPITAL

2016

2015

£

Allotted, called up and fully paid

70,865,892 Ordinary of £0.0001 each

7,087

5,072

88,592,958 A Ordinary of £0.0001 each

8,858

590,358,874 B Ordinary of £0.0001 each

59,036

-

74,981

13,930

During the year the company issued nil (2015: 2,596,732) A Ordinary, 590,358,874 (2015: nil) B Ordinary and

20,149,294 (2015: 22,026,759) Ordinary £0.00010 shares with a nominal value of £61,051 (2015: £2,462).

Consideration of £1,924,437 (2015: £457,999) was received which resulted in a share premium of £1,863,386

(2015: £455,537).

The following reproduces the text of the report prepared for the directors in respect of the company's annual

unaudited financial statements, from which the unaudited abbreviated accounts (set out on pages two to six) have

been prepared.

In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the

financial statements of Warwick Audio Technologies Ltd for the year ended 30th September 2016 which comprise the

Profit and Loss Account, the Balance Sheet and the related notes from the company's accounting records and from

information and explanations you have given us.

As a practising member firm of the Institute of Chartered Accountants in England and Wales (ICAEW), we are subject

to its ethical and other professional requirements which are detailed at icaew.com/membershandbook.

This report is made solely to the Board of Directors of Warwick Audio Technologies Ltd, as a body, in accordance with

our terms of engagement. Our work has been undertaken solely to prepare for your approval the financial statements

of Warwick Audio Technologies Ltd and state those matters that we have agreed to state to the Board of Directors of

Warwick Audio Technologies Ltd, as a body, in this report in accordance with AAF 2/10 as detailed at

icaew.com/compilation. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone

other than the company and its Board of Directors, as a body, for our work or for this report.

It is your duty to ensure that Warwick Audio Technologies Ltd has kept adequate accounting records and to prepare

statutory financial statements that give a true and fair view of the assets, liabilities, financial position and loss of

Warwick Audio Technologies Ltd. You consider that Warwick Audio Technologies Ltd is exempt from the statutory

audit requirement for the year.

We have not been instructed to carry out an audit or a review of the financial statements of Warwick Audio

Technologies Ltd. For this reason, we have not verified the accuracy or completeness of the accounting records or

information and explanations you have given to us and we do not, therefore, express any opinion on the statutory

financial statements.

Duncan & Toplis Limited

The Gables

Bishop Meadow Road

Loughborough

Leicestershire

LE11 5RE

9 June 2017