The results of subsidiaries acquired or disposed in the period are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

The results and net assets of subsidiaries whose accounts are denominated in foreign currencies are retranslated into Sterling at average rates and year-end rates respectively.

Where the Group has the power to participate in (but not control) the financial and operating policy decisions of another entity, it is classified as an associate. Associates are initially recognised in the consolidated statement of financial position at cost. Subsequently associates are accounted for using the equity method, where the Group's share of post-acquisition profits and losses and other comprehensive income is recognised in the consolidated statement of profit and loss and other comprehensive income (except for losses in excess of the Group's investment in the associate unless there is an obligation to make good those losses).

Business combinations

The Group applies the acquisition method of accounting for business combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated as the sum of the acquisition date fair values of assets transferred, liabilities incurred and equity interests issued by the Group. Acquisition costs are expensed as incurred.

Revenue recognition

Revenue represents the amount of consideration to which the Group expects to be entitled in exchange for the provision of it's services to the client, net of discounts and sales taxes.

 

For the year ended 30 June 2022, the Group used the five-step model as prescribed under IFRS15 on the Group's revenue transaction. This included the identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligations and recognition of revenue. The point of recognition arises when the Group satisfies the performance obligation by transferring control of a promised service to the customer which could occur over time or at a point in time. Provision is made for all foreseeable losses where the Company believes that a contract will deem to be unprofitable, or a client fails to remunerate the Company for services provided.

Revenue that has been billed to the client, but which is yet to be paid is accrued within trade receivables.

Discontinued operations

Discontinued operations represent major operations of the business that the Group have decided to terminate. The post-tax profit or loss of the discontinued operations is presented as a single line on the face of the consolidated income statement. The presentation of discontinued operations within prior periods is restated to reflect consistent classification of discontinued operations across all periods presented.

Foreign currency

Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. 

Non-monetary items in a foreign currency that are measured based on historical cost are translated using the exchange rate at the date of the transaction.

Foreign currency differences arising on retranslation are recognised in the statement of comprehensive income.

Retirement benefit costs

The Group operates defined contribution retirement benefit schemes. Payments to these schemes are charged as an expense in the period to which they relate. The assets of the scheme are held separately from those of the Group in independently administered funds.

             Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.  The tax currently payable is based on taxable profit for the year.  Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible.  

Deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method.  Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.  Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit. 

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is measured on an undiscounted basis using the tax rates that are expected to apply in the period when the liability is settled or the asset is realised.  Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Intangible fixed assets

Intangible assets comprise capitalised computer software which are initially recognised at cost.

Amortisation is provided so as to write off their carrying value over their expected useful economic lives. It is provided at the following rates:

Computer software -

33% straight line basis

Intangible assets also comprise intellectual property which is initially measured at cost. The useful economic life of the asset is considered to be such that any amortisation charge would be immaterial to the financial statements. The directors have therefore decided that an annual impairment review rather than an systematic amortisation is more appropriate for this asset.

Impairment of non-current assets

At each reporting date the Group reviews the carrying amounts of its non-current assets to determine whether there is any indication that those assets have suffered an impairment loss.  If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). 

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount.  An impairment loss is recognised as an expense immediately, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Financial assets

Financial assets are recognised when the Group becomes a party to the contractual provisions of the financial asset.

Financial assets are derecognised when the contractual rights to the cash flows from the financial assets expire, or when the financial asset and substantially all of the risks and rewards are transferred.

The financial assets of the Group are initially measured at fair value adjusted for transaction costs (where applicable).

Financial assets are classified into the following categories:

-      Amortised cost

-      Fair value through profit or loss (FVTPL)

-      Fair value through other comprehensive income (FVOCI)

The classification is determined by both:

-      The Group's business model for managing the financial asset

-      The contractual cash flow characteristics of the financial asset

All income and expenses relating to financial assets that are recognised in profit or loss are presented within finance costs and finance income.

Financial assets are measured at amortised cost if the assets meet the following conditions (and are not designated as FVTPL):

-     They are held within a business model whose objective is to hold the financial assets and collect its contractual cash flows

-     The contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding

After initial recognition, these are measured at amortised cost using the effective interest method.  Discounting is omitted where its effect is immaterial.  The Group's cash and cash equivalents, trade and other receivables fall into this category. 

An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset's original effective interest rate.  Losses are recognised in profit or loss and reflected in an allowance against trade and other receivables.  When an event occurring after the impairment was recognised causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.

Trade and other receivables

The group makes use of a simplified approach in accounting for trade and other receivables and records the loss allowance as lifetime expected credit losses.  These are the expected shortfalls in contractual cash flows, considering the potential for default at any point during the life of the financial instrument.  In calculating, the Group uses its historical experience, external indicators and forward-looking information to calculate the expected credit losses using a provision matrix.

The Group assesses impairment of trade and other receivables on a collective basis.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits. These are initially and subsequently recorded at fair value.

Financial liabilities

The Group's principal financial liabilities include trade and other payables and convertible debt none of which would be classified as fair value through profit or loss.

Therefore, these financial liabilities are classified as financial liabilities at amortised cost, as defined below:

Other financial liabilities include the following items:

·      Borrowings are initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument. Such interest-bearing liabilities are subsequently measured at amortised cost using the effective interest method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the statement of financial position. Interest expense in this context includes initial transaction costs and premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

·      Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at amortised cost using the effective interest method.

Convertible loan notes

Convertible loan notes issued by the Group comprise loan notes that can be converted to ordinary shares at the option of the holder.

The liability component of the convertible loan notes is recognised on the date of inception and is determined using a market interest rate for an equivalent non-convertible instrument. The equity element is recognised as the difference between the value of the financial instrument as a whole and the value of the liability component. Any directly attributable transaction costs are allocated to the equity and liability components in proportion to their initial carrying amounts.

Subsequently, the liability component of a compound financial instrument is measured at amortised cost using the effective interest rate method.

Leased assets

The company applies IFRS 16 Leases. Accordingly leases are all accounted for in the same manner:

·      A right of use asset and lease liability is recognised on the statement of financial position, initially measured at the present value of future lease payments;

·      Depreciation of right-of-use assets and interest on lease liabilities are recognised in the statement of comprehensive income;

·      The total amount of cash paid is recognised in the statement of cash flows, split between payments of principal (within financing activities) and interest (also within financing activities)

The initial measurement of the right of use asset and lease liability takes into account the value of lease incentives such as rent free periods.

The costs of leases of low value items and those with a short term at inception are recognised as incurred.

Share capital

The group's ordinary shares are classified as equity instruments.

New standards adopted

From 1 January 2021 the company has applied UK-adopted IAS. At the date of application, the UK-adopted IAS and EU-adopted IFRS were the same.

The following accounting pronouncements and standards became effective from 1 January 2021 and have been adopted but did not have a significant impact on the Group's financial results or position:

·      Covid-19 related rent concessions beyond 30 June 2021 (amendments to IFRS 16)

·      Interest Rate Benchmark Reform Phase 2 (Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16)

New standards, interpretations and amendments not yet effective

At the date of authorisation of these financial statements, the company has not early adopted the following amendments to Standards and Interpretations that have been issued but are not yet effective and have not been adopted early by the Group.

Standard or Interpretation                                                                 

·      Narrow scope amendments to IFRS 3, IAS 16 and IAS 37 (effective 1 January 2022)

·      Annual improvements to IFRS Standards 2018-2020 (effective 1 January 2022)

·      Amendments to IAS 1: Classification of Liabilities as Current or Non-current (effective 1 January 2023)

·      Amendments to IAS 1 and IFRS Practice Statement 2: Disclosure of Accounting Policies and classification of liabilities as Current or Non-current (effective 1 January 2023)

·      Amendments to IAS 8: Definition of Accounting Estimates (effective 1 January 2023)

·      Amendments to IAS 12: Deferred Tax Related to Assets and Liabilities arising from a Single Transaction (effective 1 January 2023)

As yet, none of these have been endorsed for use in the UK and will not be adopted until such time as endorsement is confirmed. The directors do not expect any material impact as a result of adopting the standards and amendments listed above in the financial year they become effective.

2.   Critical Accounting Estimates and Judgements

The group makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. Significant management judgements are as follows:

Legacy Issues

·      Due to the change in the Board, key management and operations of the Group that took place in March 2021, it is possible that there are unrecorded liabilities relating to the now discontinued activities about which the Board are unaware. The Board have undertaken, to the extent possible, a thorough review of the creditor position of the Parent Company and the Group, with a core focus on the legacy business operations. Notwithstanding the Board's assessment, there is a residual risk unforeseen liabilities may arise. However, due to the publicity around the new business, shutting down the old one and drawing down on the EHGOS facility, a number of claims were made against the company. Since the period end, no additional creditors have made a claim against the Group or the Parent Company. While it is important to consider these liabilities in these accounts the Board have however made a judgment that the risk of unrecorded actual or contingent liabilities is now low.

 

·      The Group's former Board under through its Cellplan subsidiary was promoting bespoke stem cell medical insurance and launched a website to market the product. After due enquiry, the new Board is not aware that any such policies were issued. There does however remain a residual risk that policies may have been issued. The board consider that the incidence and financial impact is now low.

3.            Loss from Operations

	Year ended 30 June 2022 £	Year ended 30 June 2021 £
The loss for the period is stated after charging:
Depreciation	-	2,504
Auditors remuneration - audit services	50,000	50,000

 

Expenses by nature:	£	£
Legal and professional fees	(7,102)	911,787
Consultancy fees	255,254	1,053,856
Other supplies and external services	86,027	444,473
Staff costs	-	1,164,975
Total operating expenses	334,179	3,575,091
Depreciation, amortisation and impairment of assets Writing down of subsidiary undertakings	- (130,249)	2,504 -
Total administrative expenses	203,930	3,577,595
Direct costs incurred in connection with EHGOF financing facility	585,000	70,000
Other penalties	-	4,593,154
	788,930	8,240,749

4.            Staff Costs

	Year ended 30 June 2022 £					Year ended 30 June 2021 £
Staff costs (including directors) comprise:
Wages and salaries	-					1,128,545
Defined contribution pension cost	-					(150)
Social security contributions and similar taxes	-					36,580
	-					1,164,975
Employee Numbers
The average number of staff employed by the group during the period amounted to:
General and administration			4		3
			4		3

Key management personnel compensation

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities, and are the directors of the company.

Remuneration of the directors and highest paid director is shown in the Remuneration Committee Report.

 

5.         Discontinued operations

In March 2019 the Board made the decision to discontinue the stem cell research operations. The operating loss until the date of discontinuation of the operations is summarised as follows:

 

	Year ended 30 June 2022	Year ended 30 June 2021
	£	£
Administrative expenses - write back of creditor balances	-	(3,673)
Operating profit/(loss)	-	(3,673)
Taxation	-	-
Profit/(loss) for the period	-	(3,673)
Other comprehensive expense	-	-
Total comprehensive profit/(loss) for the period	-	(3,673)

6.         Finance Costs

	Year ended 30 June 2022 £	Year ended 30 June 2021 £
Finance costs
Other loan penalties	-	4,592,522
Interest on leases	-	632
Total finance expense	-	4,593,154

 

7.         Taxation

	Year ended 30 June 2022 £	Year ended 30 June 2021 £
Current tax	-	-
Total current tax	-	-

 

The reason for the difference between the actual tax charge for the period and the standard rate of corporation tax in the United Kingdom applied to losses for the period are as follows:

	Year ended 30 June 2022 £	Year ended 30 June 2021 £
Loss before taxation	(762,107)	(7,697,306)
Tax using the parent company's domestic tax rate of 19% (2021: 19%)	(144,800)	(1,462,488)
Effects of:
Unrelieved tax losses and other deductions arising in the period	144,800	1,462,488
Expenses not deductible for taxation purposes	-	-
Total tax charged in the income statement	-	-

Deferred taxation attributable to losses arising in the year and for losses carried forward has not been recognised in these accounts due to the uncertainty over whether this will be recovered.

8.           Loss per share

	Year ended 30 June 2022 £	Year ended 30 June 2021 £
Numerator
Loss for the period	(762,107)	(7,697,306)
Denominator
Weighted average number of ordinary shares used in basic EPS	37,405,248,039	22,750,589,218
Basic and diluted loss per share         -  continuing operations         -  discontinued operations	(0.00) (0.00)	(0.00) (0.00)

 

9.         Intangible Assets

Group

						Intellectual Property £	Computer software £	Total £
Cost
Balance at 30 June 2020						21,600	139,106	160,706
Disposals						-	(139,106)	(139,106)
Balance at 30 June 2021 and 30 June 2022						21,600	-	21,600
Amortisation
Balance at 30 June 2020						-	139,106	139,106
Impairment Eliminated on disposal						21,599 -	- (139,106)	21,599 (139,106)
Balance at 30 June 2021 and 30 June 2022						21,599	-	21,599
Carrying amounts
Balance at 30 June 2022						1	-	1
Balance at 30 June 2021						1	-	1

 

10.       Investments

 

Company

	30 June 2022 £	30 June 2021 £
Investments in subsidiaries	2	2
	2	2

     

 

 

         Subsidiaries as at 30 June 2022:

Entity	Registered office address	Country of incorporation	Nature of business	Notes
WideCells International Limited	7 Bell Yard, London, WC2A 2JR	United Kingdom	Holding company	(c)
WideCells Limited	3 Field Court, Gray's Inn, London, WC1R 5EF	United Kingdom	In liquidation	(a)
WideCells Portugal SA	Rua Da Casa Branca, 97 Coimbra 3030-109, Portugal	Portugal	Trading company	(a)
WideCells Espana SL	Calle Castillo de Fuensaldana, 4, 28232 Las Rozas, Madrid	Spain	In liquidation	(a)
CellPlan Limited	7 Bell Yard, London, WC2A 2JR	United Kingdom	Dormant company	(a)
CellPlan International Lda	Edificio Tower Plaza Rotunda Eng, Edgar Cardoso, no. 23, 11 F, 4400-676 Vila Nova de Gaia, Portugal	Portugal	Dormant company	(b)
Iconic Labs IP Limited	7 Bell Yard, London, WC2A 2JR	United Kingdom	Trading company	(c)
Nuuco Media Limited	7 Bell Yard, London, WC2A 2JR	United Kingdom	Trading company	(c)

 

Notes:     (a) 100% owned by WideCells International Limited    (b) 100% owned by CellPlan Limited

                                   (c) 100% owned by Iconic Labs plc                                  

                                                                  

During the 2022 financial year, the following subsidiary undertakings and associated undertakings were dissolved:

-       Iconic Labs UK Limited (subsidiary);

-       Wideacademy Limited (subsidiary);

-       Coalition Media Limited (subsidiary); and

-       Medium Channel Media Limited (associate)

 

In September 2019, Widecells Limited was placed liquidation. The company was dissolved in August 2022.

In August 2022, Iconic Labs IP Limited was dissolved.

In November 2019, Widecells Espana was placed into liquidation.

 

11.       Trade and other receivables

 

Group

	30 June 2022 £	30 June 2021 £
Trade receivables	-	100,000
Other receivables	-	3,126
Total receivables	-	103,126

 

Trade and other receivables

Trade and other receivables do not contain any impaired assets. The group does not hold any collateral as security and the maximum exposure to credit risk at the consolidated statement of financial position date is the fair value of each class of receivable.

Book values approximate to fair value at 30 June 2022 and 30 June 2021.

Company

	30 June 2022 £	30 June 2021 £
Amounts due from group companies	-	398,185
Other receivables	-	2,610
	-	400,795

 

12.       Cash and cash equivalents

             Group

	30 June 2022 £	30 June 2021 £
Cash at bank available on demand	5	50,929
Bank overdraft	-	-
Total cash and cash equivalents	5	50,929

Company

	30 June 2022 £	30 June 2021 £
Cash at bank available on demand	-	838
Total cash and cash equivalents	-	838

 

13.       Share Capital

	30 June 2022		30 June 2021
	Number	£	Number	£
Authorised, allotted and fully paid - classified as equity
Ordinary shares of £0.00001 each	37,405,248,039	374,052	37,405,248,039	374,052
Deferred shares of £0.00249 each	1,637,129,905	4,076,454	1,637,129,905	4,076,454
Total	39,042,377,944	4,450,506	39,042,377,944	4,450,506

 

At 30 June 2021 and 30 June 2022, the company had 37,405,248,039 Ordinary shares of £0.00001 in issue.

In accordance with the Companies Act 2006, the company has no limit on its authorised share capital.

Pursuant to a resolution passed on 16 June 2016, the Company resolved that:

·        The directors be generally authorised in accordance with the Articles to exercise all powers of the company to allot Ordinary shares, or grant rights to subscribe for, or convert any security into Ordinary shares, up to a maximum aggregate nominal value of £500,000, provided always that such authority conferred on the directors shall (unless previously renewed, varied or revoked prior to that time) expire at the conclusion of the company's next annual general meeting or on the date falling 18 months after the date of the passing of the resolution, whichever is the sooner. The company may make an offer or agreement which would or might require Ordinary shares to be allotted pursuant to the resolution referred to in paragraph 3.6.1 of the listing prospectus before the expiry of their authority to do so, but allot the Ordinary shares pursuant to any such offer or agreement after that expiry date.

·        All pre-emption rights in the Articles to be waived; (i) for the purposes of, or in connection with, the Placing, the issue of the Conversion shares and the issue of the Warrant shares; (ii) generally for such purposes as the directors may think fit (including the allotment of equity securities for cash) up to a maximum aggregate amount of £40,543.54; and (iii) for the purposes of the issue of securities offered (by way of a rights issue, open offer or otherwise) to existing holders of Ordinary share, but subject to the directors having a right to make such exclusions or other arrangements in connection with the offering as they deem necessary or expedient; (A) to deal with the equity securities representing fractional entitlements; and (B) to deal with legal or practical problems in the laws of any territory, or the requirements of any regulatory body; on the basis that the authorities conferred under the resolution referred to in paragraph 3.6.2 of the listing prospectus shall (unless previously renewed, varied or revoked prior to that time) expire at the conclusion of the company's next annual general meeting or on the date falling 18 months after the date of the passing of the resolution, whichever is the sooner. The company may make an offer or agreement which would or might require equity securities to be issued before the expiry of its power to do so, but allot the equity securities pursuant to any such offer or agreement after that expiry date.

The holders of Ordinary shares have full voting, dividend and capital distribution rights. The Ordinary shares do not confer any rights of redemption.

On or following the occurrence of a change of control the receipts from the acquirer shall be applied to the holders of the Ordinary shares pro rata to their respective holdings.

Ordinary shares and deferred shares are recorded as equity.

 

14.       Reserves

The following describes the nature and purpose of each reserve within equity:

 

Reserve	Description and purpose
Share premium	Amount subscribed for share capital in excess of nominal value
Retained deficit	All other net gains and losses and transactions with owners (e.g. dividends) not recognised elsewhere

    

15.       Trade and other payables

Group

		30 June 2022 £	30 June 2021 £
Trade payables		809,844	821,249
Other payables		5,574,562	4,660,251
Accruals		139,120	95,621
Tax and social security		-	304,348
Total		6,523,526	5,881,469

Book values approximate to fair values at 30 June 2022 and 30 June 2021.

Company

		30 June 2022 £	30 June 2021 £
Trade payables		809,380	775,376
Other payables		5,574,562	4,657,060
Accruals		139,120	89,121
Tax and social security		-	-
		6,523,062	5,521,557

Book values approximate to fair values at 30 June 2022 and 30 June 2021.

16.       Loans and borrowings

Group

Current		30 June  2022 £	30 June 2021 £
Convertible loans		2,415,000	2,415,000
Total		2,415,000	2,415,000

 

Book values approximate to fair values at 30 June 2022 and 30 June 2021.

Company

Current		30 June  2022 £	30 June 2021 £
Convertible loans		2,415,000	2,415,000
Total		2,415,000	2,415,000

 

17.       Provisions

 

		30 June  2022 £	30 June 2021 £
Provisions brought forward Provision reversed in year		34,000 (34,000)	34,000 -
Provisions carried forward		-	34,000

 

18.       Financial Instruments - Risk Management

The group is exposed through its operations to the following financial risks:

 

·      Credit risk

·      Market risk

·      Liquidity risk

 

In common with other businesses, the group is exposed to risks that arise from use of financial instruments. This note describes the group's objectives, policies and processes for managing those risks and the methods used to measure them.

 

The principal financial instruments used by the group, from which the financial instrument risks arise, are as follows:

 

·      Cash and cash equivalents

·      Trade and other payables

·      Loans and borrowings

 

A summary of the financial instruments held by category is provided below:

 

·      Financial assets - amortised cost

·    Financial liabilities - amortised cost

 

 

 

 

 

Group:

	2022 £	2021 £
Cash and cash equivalents	5	50,929
Trade and other receivables	-	103,126
Total financial assets - amortised cost	5	154,055

 

	2022 £	2021 £
Trade and other payables	6,523,526	5,881,469
Loans and borrowings	2,415,000	2,415,000
Total liabilities - amortised cost	8,938,526	8,296,469

 

 

Company:	2022 £	2021 £
Cash and cash equivalents	-	838
Trade and other receivables	-	400,795
Total financial assets - amortised cost	-	401,633

 

	2022 £	2021 £
Trade and other payables	6,523,062	5,521,557
Loans and borrowings	2,415,000	2,415,000
Total liabilities - amortised cost	8,938,062	7,936,557

 

The Board has overall responsibility for the determination of the group's risk management objectives and policies.

 

The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Groups' competitiveness and flexibility. Further details regarding these policies are set out below:

 

Credit risk

Credit risk is the risk of financial loss to the Group if a counterparty to the financial instrument fails to meet its contractual obligations. It is Group policy to assess the credit risk of new customers before entering into contracts.

 

Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions. For banks and financial institutions, only independently rated parties with high credit status are accepted.

 

The Group does not enter into derivatives to manage credit risk.

 

Cash in bank

Group

	2022 £	2021 £
Cash held at HSBC - S&P Rating AA	5	46,746
Cash held at Santander - S&P rating A	-	4,183
Total financial assets	5	50,929

 

 

Company

	2022 £	2021 £
Cash held at HSBC - S&P Rating AA	-	838
Total financial assets	-	838

 

Market risk

 

Foreign exchange risk

Foreign exchange risk arises because the group has operations in Portugal and Spain, whose functional currency is not the same as the functional currency of the group. The group's net assets arising from such overseas operations are exposed to currency risk resulting in gains or losses on retranslation into sterling.

 

As of 30 June 2022 the group's exposure to foreign exchange risk was not material as the overseas operations had been discontinued.

 

Liquidity risk

Liquidity risk arises from the Group's management of working capital. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.

The Board will continue to monitor long term cash projections and will consider raising funds as required.

 

The following table sets out the contractual maturities (representing undiscounted contractual cash-flows) of financial liabilities:

 

Group:

2022	Up to 3 months  £	Between  3 and 12  months  £	Between 1 and 2  years £	Between 2 and 5 years  £	Over 5 years £
Trade and other payables	6,523,526	-	-	-	-
Borrowings	2,415,000	-	-	-	-
Total	8,938,526	-	-	-	-

 

 

2021	Up to 3 months  £	Between  3 and 12  months  £	Between 1 and 2  years £	Between 2 and 5 years  £	Over 5 years £
Trade and other payables	5,881,469	-	-	-	-
Borrowings	2,415,000	-	-	-	-
Total	8,296,469	-	-	-	-

 

More details in regard to the line items are included in the respective notes:

 

·      Trade and other payables - note 15

·      Loan and borrowings - note 16

 

At the balance sheet date, the Group had liabilities due for settlement within 3 months of £8,938,526, compared to a cash balance of £5. Since the year end, the Group have renegotiated repayment terms with suppliers and have arranged a further funding agreement to ensure that operating costs and legacy liabilities can be settled.

 

£2,415,000 of borrowings are convertible loan notes which can be settled by way of an issue of share capital.

 

Capital risk management

The group monitors capital which comprises all components of equity (i.e. share capital, share premium and accumulated deficit).

 

The directors are aware of the need for the Company to obtain capital in order to fund the growth of the business and are in continual discussions with providers of both debt and equity capital.  The directors regularly review the status of such discussions and aim at all times to have offers of capital funding available to the Company which more than exceed the needs of the Company over the coming period.

 

In the medium term and in addition to the need to safeguard the entity's ability to continue as a going concern, the directors are aware of the views of members on certain financing structures and therefore have set an objective to move towards a conventional, simplified capital structure based on equity capital.

 

Further details about the directors' assessment of the Group's ability to continue as a going concern and the key considerations there to are set out in the Corporate Governance Report.

 

 

At present the directors do not intend to pay dividends but will reconsider the position in future periods, as the group becomes profitable.

 

Reconciliation of movement in net cash

	Net cash at 01 July 2021	Cash flow	Loan notes issued in the  period	Loan notes converted in the period	Repayment of borrowings (continuing activities)	Net cash at 30 June 2022
	£	£	£	£	£	£
Cash at bank and in hand	50,929	(50,924)	-	-	-	5
Borrowings	(2,415,000)	-	-	-	-	(2,415,000)
Total financial liabilities	(2,364,071)	(50,924)	-	-	-	(2,414,995)

 

	Net cash at 01 July 2020		Cash flow		Loan notes issued in the  period		Loan notes converted in the period		Repayment of borrowings (continuing activities)		Net cash at 30 June 2021
	£		£		£		£		£		£
Cash at bank and in hand	180,397		(129,468)		-		-		-		50,929
Borrowings	(1,739,594)		-		(720,000)		-		44,594		(2,415,000)
Total financial liabilities	(1,559,197)		(129,468)		(720,000)		-		44,594		(2,364,071)

19.       Capital Commitments

The group had no capital commitments at 30 June 2022 or 30 June 2021.

20.       Related party Transactions

Details of directors' remuneration are given in the Remuneration Committee Report.

 

There are no other related party transactions.

21.       Contingent Liabilities

The group had no contingent liabilities at 30 June 2022 or 30 June 2021.

22.       Post Balance Sheet Events

In the fourth quarter of 2022 exited administration.       Further details can be found in the Chief Executive and Chairmans' Statement.

23.       Ultimate Controlling Party

The directors do not consider that there is an ultimate controlling party of the group.