SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

1.         GENERAL INFORMATION

 

Sealand Capital Galaxy Limited (the "Company") was incorporated in the Cayman Islands on 22 May 2015 as an exempted company with limited liability under the Companies Law of the Cayman Islands. The Company's registered office is at Willow House, PO Box 709, Cricket Square, Grand Cayman, KY1-1107, Cayman Islands. These consolidated financial statements comprise the Company and its subsidiaries (together referred to as the "Group")

 

The Company's nature of operations is to act as a special purpose acquisition company.

 

The Group engaged in digital marketing and other IT and e-Commerce related businesses.

 

2.         BASIS OF PREPARATION

 

These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRSs") and IFRIC interpretations applicable to companies reporting under IFRSs.

 

These financial statements are presented in Great British Pounds ("£") rounded to the nearest Great British Pound, except for otherwise indicated, and have been prepared under the historical cost convention.

 

These financial statements have been prepared on a going concern basis.

 

3.         STANDARDS AND INTERPRETATIONS

 

(i)         New standards, amendments and interpretations adopted by the Group and Company

 

The following IFRS or IFRIC interpretations were effective for the first time for the financial year beginning 1 January 2022. Their adoption has not had any material impact on the disclosures or on the amounts reported in these financial statements:

 

Standard / Interpretation                           Application

                                                                                                                                     

IAS 1 & IAS 8 amendments                         Definition of Material

IFRS 3 amendments                                    Business Combinations - Reference to Conceptual Framework

Amendments to IAS 16                                Property, Plant and Equipment

Amendments to IAS 37                                Provisions, Contingent Liabilities and Contingent Assets

Annual Improvements to IFRS Standards   2018-2020 cycle

 

(ii)        New standards, amendments and interpretations not yet adopted

 

Standard / Interpretation                              Application                                                                           

IAS 1 amendments                                         Presentation of Liabilities as Current or Non-current

                                                                        Effective: Annual periods beginning on or after 1 January 2023

IAS 1 amendments                                         Classification of Liabilities as Current or Non-current

                                                                        Effective: Annual periods beginning on or after 1 January 2023

IAS 1 amendments                                         Presentation of Financial Statements and IFRS Practice Statement 2: Disclosure of Accounting Policies

IAS 8 amendments                                        Accounting policies Changes in Accounting Estimates and Errors - Definition of Accounting Estimates

IAS 12 amendments                                      Income Taxes - Deferred Tax related to Assets and Liabilities arising from a Single Transaction

 

There are no IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Company or Group.

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES

 

(a)        Basis of consolidation

 

These financial statements comprise the financial statements of the Company and entities controlled by the Company (its subsidiaries) for the year ended 31 December 2022.

 

Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if, and only if, the Group has:

 

Ÿ    Power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee)

Ÿ   Exposure, or rights, to variable returns from its involvement with the investee

Ÿ   The ability to use its power over the investee to affect its returns

 

Generally, there is a presumption that a majority of voting rights results in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

 

Ÿ    The contractual arrangement(s) with the other vote holders of the investee

Ÿ    Rights arising from other contractual arrangements

Ÿ    The Group's voting rights and potential voting rights

 

(i)         Business combinations

 

The Group accounts for business combinations using the acquisition method when control is transferred to the Group. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately. Transaction costs are expensed as incurred, except if related to the issue of debt or equity securities.

 

The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognised in profit or loss.

 

Any contingent consideration is measured at fair value at the date of acquisition. If an obligation to pay contingent consideration that meets the definition of a financial instrument is classified as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, other contingent consideration is remeasured at fair value at each reporting date and subsequent changes in the fair value of the contingent consideration are recognised in profit or loss. 

 

(ii)        Subsidiaries

 

Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date on which control ceases.

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(a)        Basis of consolidation (Continued)

 

(iii)       Loss of control

 

When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related NCI and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.

 

(iv)       Transactions eliminated on consolidation

 

Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated. Unrealised gains arising from transactions with equity-accounted investee are eliminated against the investment to the extent of the Group's interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

 

(b)        Revenue recognition

 

Revenue is recognised to depict the transfer of services to customers in an amount that reflects the consideration to which the Group expects to be entitled in exchange for those goods or services. Specifically, the Group uses a 5-step approach to revenue recognition:

 

Step 1:    Identify the contract(s) with a customer;

Step 2:    Identify the performance obligations in the contract;

Step 3:    Determine the transaction price;

Step 4:    Allocate the transaction price to the performance obligations in the contract; and

Step 5:    Recognise revenue when (or as) the entity satisfies a performance obligation.

 

The Group recognises revenue when (or as) a performance obligation is satisfied, i.e. when "control" of the goods or services underlying the particular performance obligation is transferred to customers.

 

A performance obligation represents a good or service (or a bundle of goods or services) that is distinct or a series of distinct goods or services that are substantially the same.

 

Control is transferred over time and revenue is recognised over time by reference to the progress towards complete satisfaction of relevant performance obligation if one of the following criteria is met:

 

-     the customer simultaneously receives and consumes the benefits provided by the entity's performance as the Group performs;

-     the Group's performance creates and enhances an asset that the customer controls as the Group performs; or

-     the Group's performance does not create an asset with an alternative use to the Group and the Group has an enforceable right to payment for performance completed to date.

 

Otherwise, revenue is recognised at a point in time when the customer obtains control of the distinct good or service.

 

A contract asset represents the Group's right to consideration in exchange for services that the Group has transferred to a customer that is not unconditional. It is assessed for impairment in accordance with IFRS 9. In contrast, a receivable represents the Group's unconditional right to consideration, i.e. only the passage of time is required before payment of that consideration is due.

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(b)        Revenue recognition (Continued)

 

A contract liability represents the Group's obligation to transfer services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer.

 

A contract asset and a contract liability relating to a contract are accounted for and presented on a net basis.

 

Revenue from marketing service and e-commerce service is recognised when the performance obligation is satisfied.

 

Interest income from a financial asset is accrued on a time basis using the effective interest method.

 

(c)        Government grants

 

Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. When the grant relates to an expense item, it is recognised as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. When the grant relates to an asset, it is recognised as income in equal amounts over the expected useful life of the related asset.

 

When the Group receives grants of non-monetary assets, the asset and the grant are recorded at nominal amounts and released to profit or loss over the expected useful life of the asset, based on the pattern of consumption of the benefits of the underlying asset by equal annual instalments.

 

(d)        Foreign currency transactions

 

(i)         Functional and presentational currency

 

Items included in the Financial Statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates ("functional currency"), being British Pound Sterling ("GBP" or "£"), Chinese Yuan ("CNY") and Hong Kong Dollar ("HKD"). The Group Financial Statements are presented in GBP.

 

(ii)        Transactions and balances

 

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated at the rates of exchange ruling at the Statement of Financial Position date. Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies, are recognised in the Statement of Comprehensive Income.

 

 

 

 

 

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(d)        Foreign currency transactions (Continued)

 

(iii)       Group companies

 

The results and financial position of all the Group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

 

-     assets and liabilities for each statement of financial position presented are translated at the closing exchange rate at the date of that statement of financial position;

-     income and expenses for each statement of comprehensive income are translated at average exchange rates; and

-     all resulting exchange differences are recognised in other comprehensive income (loss).

 

(e)        Goodwill and intangible assets

 

Goodwill

 

Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment losses, if any.

 

For the purposes of impairment testing, goodwill is allocated to each of the Group's cash-generating units (or groups of cash-generating units) that is expected to benefit from the synergies of the combination.

 

A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is indication that the unit may be impaired. For the goodwill arising on an acquisition in a reporting period, the cash-generating unit to which goodwill has been allocated is tested for impairment before the end of that reporting period. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit on a pro rata basis based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.

 

On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the amount of profit or loss on disposal.

 

Intangible assets - Customer contract

 

The acquired customer contracts in a business combination are recognised at fair value at the acquisition date. They have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the percentage of revenue recognised of the corresponding contract.

 

(f)         Property, plant and equipment

 

Property, plant and equipment is measured on the cost basis and therefore stated at historic cost less accumulated depreciation. Historic cost includes expenditure that is directly attributable to the acquisition of the items.

 

All repairs and maintenance expenditure is charged to the Consolidated Statement of Profit or Loss during the financial period in which they are incurred.

 

Depreciation is calculated using the straight-line method to allocate their cost over their estimated useful lives, as follows:

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(f)         Property, plant and equipment (Continued)

 

Owned assets

Office equipment                           36 - 60 months

Leasehold improvement                lower of 36 months and the lease term

 

Right-of-use assets

Buildings                                           Over the lease term

 

The assets' useful lives are reviewed, and, if appropriate, asset values are written down to their estimated recoverable amounts, at each reporting date. Gains and losses on disposals are determined by comparing proceeds with the carrying amounts, and are included in profit or loss.

 

(g)        Impairment of non-financial assets

 

Goodwill and intangible assets with indefinite useful lives or those not yet available for use are not subject to amortisation and are tested for impairment at least annually, irrespective of whether there is any indication that they are impaired. All other assets are tested for impairment whenever there are indications that the asset's carrying amount may not be recoverable. An impairment loss is recognised as an expense immediately for the amount by which the asset's carrying amount exceeds its recoverable amount. Recoverable amount is the higher of fair value, reflecting market conditions less costs of disposal, and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of time value of money and the risk specific to the asset. For the purposes of assessing impairment, where an asset does not generate cash inflows largely independent from other assets, the recoverable amount is determined for the smallest group of assets that generate cash inflows independently (i.e. a cash-generating unit). As a result, some assets are tested individually for impairment and some are tested at cash-generating unit level. Goodwill in particular is allocated to those cash-generating units that are expected to benefit from synergies of the related business combination and represent the lowest level within the Group at which the goodwill is monitored for internal management purpose and not be larger than an operating segment.

 

Impairment losses recognised for cash-generating units, to which goodwill has been allocated, are credited initially to the carrying amount of goodwill. Any remaining impairment loss is charged pro-rata to the other assets in the cash generating unit, except that the carrying value of an asset will not be reduced below its individual fair value less cost of disposal, or value in use, if determinable. An impairment loss on goodwill is not reversed in subsequent periods. In respect of other assets, an impairment loss is reversed if there has been a favourable change in the estimates used to determine the asset's recoverable amount and only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Impairment losses recognised in an interim period in respect of goodwill are not reversed in a subsequent period. This is the case even if no loss, or a smaller loss, would have been recognised had the impairment been assessed only at the end of the financial year to which the interim period relates.

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(h)        Financial instruments

 

Financial assets and financial liabilities are recognised in the statements of financial position when a group entity becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities within the scope of IFRS 9 are initially measured at fair value and transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition.

 

The Group's financial assets, including deposits, receivables, contract assets and cash and cash equivalents, are subsequently measured at amortised cost using the effective interest method, less identified impairment charges (see Note 4(i)) as the assets are held within a business model whose objective is to hold assets in order to collect contractual cash flows and the contractual terms of the financial assets give rise on specific dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

 

Financial liabilities include lease liabilities, trade payables, amount due to a director, other payables and accruals. All financial liabilities are subsequently measured at amortised cost using the effective interest method.

 

(i)         Impairment of financial assets

 

The Group recognises loss allowances for expected credit loss on the financial instruments that are not measured at fair value through surplus or deficit. The Group considers the probability of default upon initial recognition of financial assets and assesses whether there has been a significant increase in credit risk on an ongoing basis.

 

The Group considers the credit risk on a financial instrument is low if the financial instrument has a low risk of default, the debtor has a strong capacity to meet its contractual cash flow obligations in the near term and adverse changes in economic and business conditions in the longer term may, but will not necessarily, reduce the ability of the debtor to fulfill its contractual cash flow obligations.

 

The carrying amount of the receivables is reduced through the use of the receivable impairment charges account. Changes in the carrying amount of the receivable impairment charges account are recognised in surplus or deficit. The receivable is written off against the receivable impairment charges account when the Group has no reasonable expectations of recovering the receivable.

 

If, in a subsequent period, the amount of expected credit losses decreases, the reversal would be adjusted to the receivable impairment charges account at the reporting date. The amount of any reversal is recognised in surplus or deficit.

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(j)         Derecognition of financial assets and financial liabilities

 

Financial assets are derecognised when the contractual rights to receive the cash flows of the financial assets expire; or where the Group transfers the financial assets and either (i) it has transferred substantially all the risks and rewards of ownership of the financial assets; or (ii) it has neither transferred nor retained substantially all the risks and rewards of ownership of the financial assets but has not retained control of the financial assets.

 

Financial liabilities are derecognised when they are extinguished, i.e. when the obligation is discharged, cancelled or expires.

 

(k)        Inventories

 

Inventories are stated at the lower of cost or net realisable value, with cost determined using the first-in, first-out ("FIFO") cost method. Net realisable value is the estimated selling price in the ordinary course of business, less estimated cost necessary to make the sale. Allowances are established to reduce the cost of excess and obsolete or damaged inventories to their estimated net realiable value.

 

(l)         Trade Receivables

 

In determining the recoverability of trade receivables, the Group considers any change in the credit quality of the trade receivables from the initial recognition date to the end of each of the reporting period. In the opinion of the directors of the Company, apart from those balances for which allowances have been provided, other trade receivables at the end of each reporting period are of good credit quality which considering the high credibility of these customers, good track record with the Group and subsequent settlement, the management believes that no impairment allowance is necessary in respect of unsettled balances.

 

The Group applied the simplified approach to provide the expected credit losses ("ECL") prescribed by IFRS 9. The impairment methodology is set out in Note 4 and Note 5(iii) respectively. As part of the Group's credit risk management, the Group assesses the impairment for its customers based on different group of customers which share common risk characteristics that are representative of the customers' abilities to pay all amounts due in accordance with the contractual terms.

 

(m)      Cash and cash equivalents

 

Cash and cash equivalents include cash in hand and deposits held at call with banks.

 

(n)        Current and deferred income tax

 

Income tax comprises current and deferred tax. Current income tax is recognised in the profit or loss, except to the extent that it relates to items recognised directly in equity. In this case the tax is also recognised directly in other comprehensive income or directly in equity, respectively.

 

Current income tax is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company's subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.      SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(n)        Current and deferred income tax (Continued)

 

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the Consolidated Financial Statements. However, the deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted, or substantially enacted, by the end of the reporting period and are expected to apply when the related deferred income tax asset is utilised, or the deferred income tax liability is settled.

 

Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

 

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities, and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

 

(o)        Leases

 

Lessee

 

All leases with a term of more than 12 months are recognised as an asset representing the right to use of the underlying asset and a liability representing the obligation to make lease payments, unless the underlying asset is of low value. Both the asset and the liability are initially measured on a present value basis. Right-of-use assets are recognised under fixed assets and are measured at cost less any accumulated depreciation and impairment losses and adjusted for any remeasurement of the lease liabilities. Right-of-use assets are depreciated on a straight-line basis over the shorter of the useful life of the assets and the lease term. Lease liabilities are initially measured at the present value of unpaid lease payments and subsequently adjusted by the effect of the interest on and the settlement of the lease liabilities, and the re-measurement arising from any reassessment of the lease liabilities or lease modifications.

 

Lessor

 

Leases where substantially all the risks and rewards of ownership of assets remain with the Group are classified as operating leases. Assets leased under operating leases are included in fixed assets and rentals receivable are credited to surplus or deficit on the straight-line basis over the lease term.

 

(p)        Going Concern

 

The director's cash-flow projections for the forthcoming 12 months conclude there will be the need for additional cash resources to fully implement the business plans. The directors are in discussions with a number of individuals that may lead to further equity and/or loans being raised. There is no certainty that any such funds will be forthcoming or the price and other terms being acceptable.

 

(q)        Employee benefits

 

Salaries, wages, paid annual leave, bonuses and non-monetary benefits are accrued in the Year in which the associated services are rendered by the employees of the Group.

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

4.         SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(r)        Share capital

 

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

 

(s)        Share-based payments

 

Equity-settled share-based payment transactions in exchange for services of goods are measured at the fair value of the goods or services received, except where that fair value cannot be estimated reliably, in which case they are measured at the fair value of the equity instruments granted, measured at the date the entity obtains the goods or the counterparty renders the service. The fair value excludes the effect of non-market-based vesting conditions. Details regarding the determination of the fair value of equity-settled share-based transactions are set out in Note 22.

 

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group's estimate of the number of equity instruments that will eventually vest. At each reporting date, the Group revises its estimate of the number of equity instruments expected to vest as a result of the effect of non-market-based vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to reserves.

 

5.         FINANCIAL RISK MANAGEMENT

 

The Board's overall risk management strategy seeks to assist the Group in meeting its financial targets, while minimising potential adverse effects on financial performance. Its functions include the review of future cash flow requirements.

 

The Group's activities expose it to a variety of financial risks as below.

 

(i)         Interest rate risk

 

The Group has floating rate financial assets in the form of deposit accounts with major banking institutions of £35,567. Apart from the abovementioned amount, no other financial instrument is subjected to interest rate risk. If the interest rate increases or decreases for 100 basis points, the effect in profit and loss will increase or decrease for £356.

 

(ii)        Foreign exchange risk

 

Foreign currency risk is the risk to earnings or capital arising from movements in foreign exchange rates. The Group's foreign currency risk primarily arises from currency exposures originating from its foreign exchange dealings and other investment activities.

 

The Group monitors the relative foreign exchange positions of its assets and liabilities to minimise foreign currency risk. The foreign currency risk is managed and monitored on an ongoing basis by senior management of the Group.

 

The following table demonstrates the sensitivity at the end of the reporting period to a reasonably possible change in CNY with all other variables held constant, of the Group's loss before tax (due to changes in the fair value of monetary assets and liabilities).

 

		Increase/(decrease) in loss before tax
		2022		2021
		£		£
CNY strength/weakened against GBP for 1 per cent		347/(347)		718/(718)

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

5.         FINANCIAL RISK MANAGEMENT (CONTINUED)

 

(iii)       Credit risk

 

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The carrying amount of financial assets and contract assets recognised on the consolidated statement of financial position, which is net of impairment losses, represents the Group's exposure to credit risk without taking into account the value of any collateral held or other credit enhancements. The Group's maximum exposure to credit risk is summarised in Note 24.

 

Most of the Group's cash in banks have been deposited with reputable and creditworthy banks in Hong Kong. Management considers there is minimal credit risk associated with those balances.

 

(iv)       Liquidity risk

 

Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations associated with financial liabilities. The responsibility for liquidity risk management rests with the Board of Directors.

 

As at the reporting date, the Group was in a net current liabilities positions. The Group is currently obtaining cash advances from one of a director to meet its temporary operating needs. Further, the Board of Directors is sourcing alternatives for the Group's future capital needs include the issue of equity instruments and external borrowing. These alternatives are evaluated to determine the optimal mix of capital resources for our capital needs.

 

(v)        Market risk

 

Market risk is the risk that changes in market prices, such as interest rates and foreign exchange rates, will affect the Group's income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. The Group does not hedge these risk exposures due to the lack of any market to purchase financial instruments.

 

(vi)       Capital risk management

 

The Company manages its capital to ensure that the Company will be able to continue as a going concern while maximising the return to shareholder through the optimisation of the debt and equity balances.

 

The capital structure of the Company consists of debt, which includes equity attributable to the owners of the Company, comprising share capital, share premium and accumulated losses.

 

The directors of the Company review the capital structure regularly. As part of this review, the directors of the Company consider the cost of capital and the associated risks, and take appropriate actions to adjust the Company's capital structure. The overall strategy of the Company remained unchanged.

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2021

 

 

6.         CRITICAL ACCOUNTING JUDGEMENTS AND KEY UNCERTAINTIES OF ESTIMATION UNCERTAINTY

 

The preparation of the Group's financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and their accompanying disclosures and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amounts of the assets or liabilities affected in the future.

 

The estimates and underlying assumption are reviewed 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 in the period of the revision and future periods if the revision affects both current and future periods.

 

Key source of estimation uncertainty

 

Trade receivables and contract assets

 

The Group's customer base consists of a wide range of clients and the trade receivables and contract assets are categorised by common risk characteristics that are representative of the customers' abilities to pay all amounts due in accordance with the contractual terms. The Group applies a simplified approach in calculating ECL for trade receivables and contract assets and recognises a loss allowance based on lifetime ECL at each reporting date and has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The expected loss rate used in the provision matrix is calculated for each category based on actual credit loss experience over the prior years and adjusted for current and forward-looking factors to reflect differences between economic conditions during the period over which the historical data has been collected, current conditions and the Group's estimate on future economic conditions over the expected lives of the receivables. There was no change in the estimation techniques or significant assumptions made during the Year.

 

At 31 December 2022, a provision for impairment loss on trade receivables and contract assets of £Nil (2021: £91,757) was recognised according to the management expected loss rate on the ageing group. The Group's trade receivables which are past due but which the Group has not impaired as there have not been any significant changes in credit quality of customers and the management believes that the amounts are fully recoverable. Receivables that were neither past due nor impaired at 31 December 2022 relate to a wide range of customers for whom there was no history of default.

 

The Group does not hold any collateral over trade receivables and contract assets at 31 December 2022 (2021: Nil).

 

Allowance for obsolete inventories

 

Allowance for obsolete inventories is made for those identified obsolete and slow-moving inventories and inventories with a carrying amount higher than net realisable value. The assessment of the allowance involves management's judgement and estimates on which are influenced by assumptions concerning future sales and judgements in determining the appropriate level of inventory allowance against identified surplus or obsolete items. Where the actual outcome in future is different from the original estimate, such difference will impact the carrying value of inventories and allowance charge/write-back in the period in which such estimate has been changed.

 

At 31 December 2022 and 2021, no allowance for obsolete inventories was recognised.

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

7.         SEGMENT INFORMATION

 

The Chief Operating Decision Maker ("CODM") has been identified as the executive directors of the Company who reviews the Group's internal reporting in order to assess performance and allocate resources. The CODM has determined the operating segments based on these reports.

 

For management purposes, the Group is organised into business units based on their products and services, and has reportable operating segments as follows:

 

(a)        The digital marketing and payment segment includes services on enlisting merchants to mobile payment gateways and providing digital advertising services;

 

(b)        The software development and support segment includes sales and distribution of mobile game and all other I.T. related development and support services; and

 

(c)        The e-commerce segment includes sales of goods through internet and provision for consultancy services related to e-commerce.

 

	Digital marketing and payment	Software development and support	e-Commerce	Unallocated	Total
	£	£	£	£	£
Year ended 31 December 2022
Revenue	887	-	225,863	-	226,750
Segment (loss)/profit	(53,128)	(7,920)	4,534	(123,055)	(179,569)
Depreciation	-	-	-	34,746	34,746
Assets	443	-	196,419	74,319	271,181
Liabilities	21,767	-	125,892	1,016,365	1,164,024
Year ended 31 December 2021
Revenue	148,530	-	29,137	-	177,667
Segment (loss)/Profit	(162,520)	24,641	(174,093)	(721,741)	(1,033,713)
Depreciation	-	-	137	31,204	31,341
Provision for impairment loss on trade and other receivables	78,881	-	12,876	-	91,757
Assets	30,402	200	99,161	57,551	187,314
Liabilities	258,425	43,484	96,713	812,857	1,211,479

          

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

7.         SEGMENT INFORMATION (CONTINUED)

 

Geographical information:

		2022		2021
Revenue by Geography		£		£
Macau		-		148,192
Hong Kong		226,750		21,103
Mainland China		-		8,372
		226,750		177,667

Information about major customers

 

For the years ended 31 December 2022, no external customer contributed more than 10% to the Group revenue (2021: one external customer, amounting to £144,839 (approximately 82% to the Group revenue)).

 

8.        REVENUE AND OTHER INCOME

			2022	2021
			£	£
REVENUE
Advertising services			887	148,530
Commission income			1,301	1,670
eCommerce sales			224,562	27,467
			226,750	177,667
OTHER INCOME
Bank interest income			10	9
Gain on reversal of overprovision of expenses			-	6,660
Government subsidy			2,730	65,995
Others			17,744	15,434
			20,484	88,098

          

9.        LOSS BEFORE TAX

	2022	2021
	£	£
Loss before tax has been arrived at after charging:
Depreciation - Owned assets	1,387	2,772
Depreciation - Right of use assets	33,359	28,568
Cost of inventories sold	133,462	16,903
Exchange gain, net	(125,886)	(22,907)
Provision for impairment losses on trade and contract assets	-	91,757
Staff cost (including Director Remuneration)	307,105	352,036
Share-based payment expense	-	357,417
Audit fees
-    for the year	52,241	19,411
-    underprovision for prior years	-	1,276

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

10.       EMPLOYEES

 

The average number of employees during the Year was made up as follows:

 

		2022	2021
Directors		2	3
Staff		7	11

 

		2022	2021
		£	£
Staff costs, including directors' costs comprise:
Wages, salaries and other staff costs		307,105	352,036
Share-based remuneration		-	357,417
		307,105	709,453

          

Key Management Remuneration

 

The directors' emoluments in respect of qualifying services, which all related to short-term employee benefits, were as follows:

			2022	2021
			£	£
Chung Lam Nelson Law
Salaries and fees - paid in cash			180,000	180,000
Share-based payment			-	119,139
Geoffrey John Griggs
Salaries and fees - paid in cash			18,000	18,000
Share-based payment			-	119,139
			198,000	436,278

 

No pension contributions were made on behalf of the directors of the Company.

 

No share options were granted to directors during the year. Share options to the value of £238,278 were granted to directors during year ended 31 December 2021.

 

Mr. Mark Barney Battles resigned as director of the Company on 31 March 2021.

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

11.     INCOME TAX

 

No provision for profits tax has been made in these consolidated financial statements as the Group did not have any assessable profits. The profits tax rate for Hong Kong is currently at 16.5% (2021: 16.5%) of the estimated assessable profits for the Year.

 

A reconciliation of income tax expense applicable to the loss before tax at the statutory tax rate of Hong Kong to the income tax expense at the effective tax rate of the Group is as follows:

 

		2022	2021
		£	£
Loss before tax		(179,569)	(1,033,713)
Tax at the statutory tax rate of 16.5%		(29,629)	(182,715)
Effect of different tax rates in other jurisdictions		51,135	836
Income not subject to tax		(178,623)	(4,129)
Expenses not deductible for tax		157,216	130,090
Tax losses not recognized for the year		4,856	55,918
Utilisation of tax losses not recognised for the year		(4,955)	-
		-	-

          

Potential deferred tax assets arising from operating loss carryforward totalling approximately £570,000 (2021: £924,000) have not been recognised due to uncertainty as to when taxable profits will be generated.

 

12.     BASIC AND DILUTED LOSS PER SHARE

 

Basic loss per share is calculated by dividing the loss attributable to the Company's owners of £177,096 (2021: £962,473) by the weighted average number of 602,495,699 ordinary shares (2021: 595,695,385) in issue during 2022.

 

The following potential ordinary shares are anti-diluted and therefore excluded from the weighted average number of ordinary shares for the purpose of diluted loss per share.

 

		2022	2021
		£	£
Effect of potential ordinary shares
Employee share options (Note 22(a))		105,122,539	105,122,539

Diluted loss per share was the same as basic loss per share as no potential dilutive ordinary shares were outstanding for both the years ended 31 December 2022 and 2021.

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

13.     PROPERTY, PLANT AND EQUIPMENT

	Office equipment	Leasehold improvement	Right-of-use Assets	Total
	£	£	£	£
At 1 January 2022	-	1,159	14,491	15,650
Additions for the year	-	-	59,721	59,721
Depreciation for the year	-	(1,387)	(33,359)	(34,746)
Exchange differences	-	228	3,938	4,166
At 31 December 2022	-	-	44,791	44,791
At 1 January 2021	489	3,461	43,300	47,250
Depreciation for the year	(489)	(2,283)	(28,568)	(31,340)
Exchange differences	-	(19)	(241)	(260)
At 31 December 2021	-	1,159	14,491	15,650

14.       INVENTORIES

 

		2022	2021
		£	£
Finished goods		106,088	81,823

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

15.     TRADE RECEIVABLES, DEPOSIT, PREPAYMENT AND OTHER RECEIVABLES

 

(a)        Trade receivables

		2022	2021
		£	£
Trade receivables - billed		26,430	28,186
Trade receivables - unbilled		-	54,827
Less: Provision for impairment loss		-	(67,890)
		26,430	15,123

 

During the year, the Group has recognised a provision for impairment loss on trade receivables of Nil (2021: £66,918). The Group normally grants credit periods of up to 90 days to its customers as approved by the management on a case by case basis.

 

The ageing analysis of trade receivables - billed (net of loss allowance) based on invoice date at the end of the reporting period is as follows:

		2022	2021
		£	£
Within 30 days		9,305	4,010
31 to 60 days		6,134	3,651
61 to 90 days		2,006	1,822
91 to 180 days		8,985	5,640
		26,430	15,123

 

At the reporting period end, all the trade receivables - billed are past due but not impaired at the reporting date. The directors of the Company considered that the ECL for trade receivables is insignificant as at 31 December 2022 (2021: same) since the ageing of all the trade receivables is within 180 days.

 

The carrying amount of the Group's trade receivables as at 31 December 2022 and 2021 was denominated in Hong Kond Dollars.

 

(b)       Deposit,prepayments and other receivables

 

		2022	2021
		£	£
Prepayments		35,814	51,577
Deposit and other receivables		22,491	14,943
		58,305	66,520

 

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

16.       TRADE PAYABLES

 

The following is an ageing analysis of trade payables presented based on the invoice date at the end of each reporting period:

		2022	2021
		£	£
Within 30 days		-	36,110
31 to 60 days		-	-
61 to 90 days		-	-
91 to 180 days		-	-
181 to 365 days		-	2,213
More than 365 days		36,110	79,530
		36,110	117,853

 

 

17.       AMOUNT DUE TO A DIRECTOR

 

The amount was unsecured, interest-free and had no fixed terms of repayment.

 

18.     LEASE LIABILITIES

 

The total minimum lease liabilities under finance leases and their present values at the reporting date are as follows:

 

		2022	2021
		£	£
Current portion:
Gross finance lease liabilities		30,544	14,823
Finance expense not recognised		(686)	(73)
		29,858	14,750
Non-current portion:
Gross finance lease liabilities		15,272	-
Finance expense not recognised		(75)	-
		15,197	-
		45,055	14,750

 

		2022	2021
		£	£
The net finance lease liabilities are analysed as follows:
-     Not later than 1 year		29,858	14,750
-     Later than 1 year but not more than 5 years		15,197	-
Net finance lease liabilities		45,055	14,750

The interest on lease liabilities for the year ended 31 December 2022 was £738 (2021: £656). The Group does not recognise right-of-use assets and lease liabilities for short-term leases and leases where the underlying asset is of low value. The expenses for these leases for the year ended 31 December 2022 were £Nil (2021: £6,940).

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

19.     SHARE CAPITAL

	2022					2021
	Number of shares					Number of shares
		£					£
Ordinary shares issued and fully paid
At 1 January	595,694,385	59,569				509,830,346	50,983
Issue of shares	120,120,695	12,012				85,864,039	8,586
At 31 December	715,815,080	71,581				595,694,385	59,569

 

On 20 December 2022, the Company has issued 115,211,604 new ordinary shares of 0.21 pence each to Mr. Nelson Law, the Company's Chairman and Chief Financial Officer, for the conversion of the loan owned to him of £241,944.

 

On 4 April 2022, the Company has issued 4,909,091 new ordinary shares of the Company in lieu of professional service provided.

 

On 30 March 2021, Mr Nelson Law, the Company's Chairman and Chief Financial Officer, subscribed for 6,206,896 new ordinary shares of the Company of 1.45 pence each for a cash consideration of £90,000 in aggregate. 

 

On 26 July 2021, the Company entered into an advisory and consultancy agreement with an independent third party and settled the service fee of £22,500 by issuing 1,800,000 ordinary of 1.25 pence each.   

 

On 19 October 2021, the Company issued 77,142,857 new ordinary shares of 0.7 pence each to Mr. Nelson Law, the Company's Chairman and Chief Financial Officer, for the conversion of the loan owned to him of £540,000.

 

On 19 October 2021, the Company entered into a service agreement with an entity related to Mr. Geoffrey John Griggs, a director of the Company, and settled the service fee by issuing 714,286 ordinary shares of 0.7 pence each.  

 

20.       CAPITAL AND RESERVES

 

The nature and purpose of equity and reserves are as follows:

 

Share capital comprises the nominal value of the ordinary issued share capital of the Company.

 

Share Premium represents consideration less nominal value of issued shares and costs directly attributable to the issue of new shares.

 

 

 

 

 

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

21.       BUSINESS COMBINATION

 

During the year ended 31 December 2021, the Company have acquired additional interest in Hyrax from 40% to 100%. Hyrax had no material impact on the Group's consolidated financial statements of comprehensive income, both from the date of the acquisition as well as assuming its acquisition had been effected as at 1 January 2021.

 

The fair value of the identifiable assets acquired and liabilities recognised at the date of acquisition as follows:

			£
Trade and other receivables			13,298
Due from immediate holding company			257
Cash and bank balance			43,428
Trade and other payables			(50,433)
Total identifiable net assets at fair value			6,550
Amount previously accounted for as an associate			(2,620)
Gain on bargain purchase			(3,930)
Net assets acquired			-
Payment of nominal cash consideration			-
Total purchase consideration			-
Assumption of receivable from immediate holding company			257
Cash and bank balance acquired			43,428
Net cash flow on acquisition of a subsidiary			43,685

The fair value of the identifiable assets acquired and liabilities recognised at the date of acquisition in this annual report was assessed by the management with their reasonable estimation. The Group did not engage any professional party to perform a detailed purchase price allocation exercise due to the size of the acquisition and the consideration of cost-saving.

 

22.       SHARE-BASED PAYMENTS

 

(a)        Share Options

 

During the year ended 31 December 2021, the Group has implemented a stock option plan (the "Plan") for the employees and directors, which awards options over the ordinary share of the Company. The Board of Directors (the "Board") approves all grants and the terms of all grants. Options awarded under the Plan generally vest on issue and exercisable over a period from one year after the grant date to four years after the grant date.

 

The fair value of each option granted is estimated on grant date using the Black-Scholes option-pricing model by applying the following assumptions:

 

Share price                                                                                                                                             £0.0007

Risk-free interest rate                                                                                                                         0.0022%

Expected life of warrant (years)                                                                                                                      4

Expected annualised volatility                                                                                                                  0.66

Expected dividend yield                                                                                                                                Nil

 

For the year ended 31 December 2021, the Company recorded share-based compensation expenses in the amount of £357,417.

 

 

 

 

 

           SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

22.       SHARE-BASED PAYMENTS (CONTINUED)

 

(a)        Share Options (Continued)

 

At 31 December 2022 and 2021, the Group had 105,122,539 share options outstanding as follows.

 

Date of            Exercise         Expiry                 Exercise         Number            Exercisable at

Grant               start date      date                   price                granted             31 December 2021

 

19/10/2021   19/10/2021   18/10/2025      0.7p                 Nil                        105,122,539

                        

(b)      Shares issued for services

 

On 4 April 2022, the Company has issued 4,909,091 new ordinary shares of the Company in lieu of professional service provided.

 

On 26 July 2021, the Company entered into an advisory and consultancy agreement with an independent third party and settled the service fee of £22,500 by issuing 1,800,000 ordinary of 1.25 pence each.  

 

On 19 October 2021, the Company entered into a service agreement with an entity related to Mr. Geoffrey John Griggs, a director of the Company, and settled the service fee by issuing 714,286 ordinary of 0.7 pence each.  

 

23.       RELATED PARTY TRANSACTIONS

 

(a)     Details of the compensation of key management personnel was disclosed in Note 10 to the financial statements.

 

(b)     Apart from the balances with related parties at the end of the reporting period disclosed elsewhere in the financial statements, the Company had not entered into any significant related party transactions for the Year.

 

24.       FINANCIAL INSTRUMENTS BY CATEGORY

 

The totals for each category of financial instruments is as follows:

			2022	2021
Financial assets			£	£
Financial assets at amortised cost
Trade receivables			26,430	15,123
Deposit and other receivables			22,491	14,943
Cash and cash equivalents			35,567	8,198
			84,488	38,264
Financial liabilities
Liabilities at amortised cost
Trade payables			36,110	117,853
Other payables and accrued expense			480,213	429,255
Amounts due to directors			602,646	649,621
Lease liabilities			45,055	14,750
			1,164,024	1,211,479

Prepayments are excluded from the summary above.

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

25.       CHANGES IN LIABILITIES ARISING FROM FINANCING ACTIVITIES

 

		Lease liabilities
		2022	2021
		£	£
At 1 January		14,750	43,556
New lease		59,721	-
Financing cash flows		(33,582)	(28,566)
Exchange adjustment		4,166	(240)
At 31 December		45,055	14,750

26.       CAPITAL COMMITMENTS

 

There were no capital commitments as at the year ended 31 December 2022 (2021: Nil).

 

27.       MAJOR NON-CASH TRANSACTIONS

 

During the year ended 31 December 2022, the Group had entered the following major non-cash transactions:

 

(a)   The issuance of 4,909,091 shares of the Company of approximately £27,000 was settled against the amount due to a director in relation to the professional service paid on behalf (Note 17).

(b)   The issuance of 115,211,604 shares of the Company of approximately £242,000 was settled against the amount due to a director (Note 17).

 

28.     DISPOSAL OF SUBSIDIARIES

 

On 16 March 2022 and 16 December 2022, the Group entered into sales and purchase agreements pursuant to which the Group agreed to transfer its equity interests in the following subsidiaries at aggregate consideration of HK$2 to independent third parties.

 

Name of subsidiaries

GZ Ruiyou Information Technologies Co., Limited

Hyrax Holdings Limited

ecWay Group Limited

ecWay (UK) Limited

ecWay (France) Limited

New Sky Global Media Limited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEALAND CAPITAL GALAXY LIMITED

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 

 

28.     DISPOSAL OF SUBSIDIARIES (CONTINUED)

 

The following summarises the aggregate consideration and the carrying amount of the assets and liabilities at the date of disposal:

 

			£
Net liabilities disposed of
Deposit, prepayment and other receivables			24,446
Cash and cash equivalent			1,018
Amount due to a director			(13,649)
Trade and other payables			(356,891)
			(345,076)
Derecognition of reserves upon disposal of subsidiaries			105,574
Derecognition of non-controlling interest upon disposal of subsidiaries			107,806
Exchange difference			(21,304)
Gain on disposal of subsidiaries			153,000
			-
Net cash flow on disposal of subsidiaries
Cash consideration			-
Cash and cash equivalents disposed of			(1,018)
Net outflow of cash and cash equivalents			(1,018)

29.     DEREGISTRATION OF SUBSIDIARIES

 

In November 2022, the Group deregistered the subsidiaries of Tengbafong Holdings Limited, Tengbayang Holdings Limited and ePurse (China) Limited. The principal activities of the subsidiaries are inactive.

 

The following summarises the carrying amount of the assets and liabilities at the date of deregistration:

 

			£
Net liabilities of the deregistered subsidiaries
Trade and other payables			(2,764)
			(2,764)
Derecognition of reserves upon deregistration of subsidiaries			(1,212)
Derecognition of non-controlling interest upon deregistration of subsidiaries			72
Gain on deregistration of subsidiaries			3,904
			-
Net cash flow on deregistration of a subsidiary			-
Net outflow of cash and cash equivalents			-