Registered number:
Rees Pollock
Chartered Accountants
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COMPANY INFORMATION
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GROUP STRATEGIC REPORT
For the Year Ended 31 March 2020
The OxFORD Group (the “Group”) comprises The OxFORD Asset Management Company Limited (the “Company”) and OxFORD Asset Management LLP (the “LLP”). The Company is the holding company and managing member of, and also provides services to, the LLP. The principal activity of the LLP to date has been to provide investment advisory services to OxAM Quant Fund Limited (the “Fund”).
The sole shareholder of the Company is also a director of the Company who is actively involved in its management. As a result, he is conversant with the performance and financial position of the business and, consequently, only limited details are provided in this review.
Performance during the year was disappointing with falling assets under management leading to reduced fee income and consequently lower Group profits.
The Covid-19 outbreak led to unprecedented market conditions during March 2020. In light of the uncertainty facing the fund the LLP had been managing, and to preserve investor value, it was decided that the portfolio should be liquidated and monies returned to investors in the Fund. That took place in several tranches over the course of the following months. The business continued to operate remotely while government measures were put in place to restrict the spread of Covid-19. The Group conducted a review of its operations and reduced the number of staff and re-focused its attention on advising new funds, the first of which was launched in July 2020.
The Group will focus on the development of its advisory mandate to new funds with a view to commencing marketing activity when conditions faced by the Group are considered appropriate.
The directors recognise the major challenges faced by the Group as it begins to advise new funds at a time of significant economic uncertainty. The Group will require additional capital in the forthcoming period to support the business during the start-up phase of the new funds which the shareholder is committed to providing.
The Group considers a number of financial indicators in judging its performance including assets under management, returns and fees generated and cost levels. The Group recognises that its prospects and performance cannot be measured solely by reference to financial indicators. While non-financial measures are typically more subjective in nature, the directors consider such aspects as the effectiveness of the staff who deliver the Group’s research efforts (especially in view of the current restrictions), the impact of the changing economic and regulatory environment on the Group’s business and the nature and composition of investors in the funds it manages.
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GROUP STRATEGIC REPORT (CONTINUED)
For the Year Ended 31 March 2020
The directors’ focus is on the long-term success of the Group. They consider that this depends on delivering consistent strong performance for the funds it advises for the benefit of their investors while maintaining a reputation for operating with high standards of business conduct. This requires the Group to maintain a first class team of committed employees working with state of the art infrastructure supported by input from a range of professional industry service providers and other suppliers. Key to this is building long term relationships with all parties involved with the Group. Success in this objective is seen as benefiting both the Group and its employees.
This report was approved by the board on 26 March 2021
and signed on its behalf.
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DIRECTORS' REPORT
For the Year Ended 31 March 2020
The directors present their report and the financial statements for the year ended 31 March 2020.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the
consolidated
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year
. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙
select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙
make judgements and accounting estimates that are reasonable and prudent;
∙
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation and minority interests, amounted to £
141,003
(2019:
£
631,235
)
.
The directors recommended and paid a dividend of £nil
(2019: £4,706)
to the shareholders in respect of the
year ended 31 March 2019.
The directors who served during the year were:
Information on the Group's future developments is given in the Group Strategic Report.
Information on the Group's engagement with suppliers, customers and others is given in the Group Strategic Report.
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DIRECTORS' REPORT (CONTINUED)
For the Year Ended 31 March 2020
The auditors, Rees Pollock, will be proposed for reappointment in accordance with
section 485 of the Companies Act 2006.
This report was approved by the board on
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF
THE OXFORD ASSET MANAGEMENT COMPANY LIMITED
We have audited the financial statements of The OxFORD Asset Management Company Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2020, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group and Company Statement of Changes in Equity, the Group Statement of Cash Flows,
and the notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards,
including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
∙
the directors
' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
∙
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Group's or the parent Company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
The directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditors' Report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF
THE OXFORD ASSET MANAGEMENT COMPANY LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙
the information given in the Group Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙
the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms part of our Auditors' Report.
This report is made solely to the Company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditors 35 New Bridge Street
EC4V 6BW
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the Year Ended 31 March 2020
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CONSOLIDATED BALANCE SHEET
As at
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 13 to 23 form part of these financial statements.
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COMPANY BALANCE SHEET
As at
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 13 to 23 form part of these Financial Statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended
31 March 2020
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended
31 March 2019
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COMPANY STATEMENT OF CHANGES IN EQUITY
For the Year Ended
31 March 2020
COMPANY STATEMENT OF CHANGES IN EQUITY
For the Year Ended
31 March 2019
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CONSOLIDATED STATEMENT OF CASH FLOWS
For the Year Ended 31 March 2020
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
The OxFORD Asset Management Company Limited is a private company incorporated in the United Kingdom and registered in England and Wales at OxAM House, 6 George Street, Oxford, OX1 2BW.
2.
Accounting policies
The Financial Statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard (FRS) 102, the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland and the Companies Act 2006.
The preparation of Financial Statements in compliance with FRS 102 requires the use of certain critical accounting estimates. Management do not consider there are any key accounting estimates or assumptions made that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year. It also requires management to exercise judgement in applying the Group's accounting policies. Due to the straightforward nature of the business, management consider that no critical judgements have been made in applying the Group's accounting policies. The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these Financial Statements. The following accounting policies have been applied:
The consolidated Financial Statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
In accordance with the transitional exemption available in FRS 102, the group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102.
The directors have prepared forecasts which indicate that the business will require additional capital in order to support its operations and to meet the regulatory requirements of the FCA during the start-up period of this new fund. The shareholder has expressed his willingness to provide such additional funding as may be required to support the business for a period of at least twelve months from the date of signing of these financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
2.
Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
The estimated useful lives range as follows:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
The Group holds but does not actively trade in financial instruments. The financial instruments that it holds arise directly from operations. All trade and other debtors are initially recognised at transaction value, as none contain in substance a financing transaction. Thereafter trade and other debtors are reviewed for impairment where there is objective evidence based on observable data that the balance may be impaired. The Group does not hold collateral against its trade and other receivables so its exposure to credit risk is the net balance of trade and other debtors after allowance for impairment. The Group's cash holdings comprise on demand balances. All cash is held with banks with strong external credit ratings. Trade and other creditors and accruals are initially recognised at transaction value as none represent a financing transaction. They are only derecognised when they are extinguished. As the Group has primarily short term receivables and payables, its net current asset position is a reasonable measure of its liquidity at any given time.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
2.
Accounting policies (continued)
The Group's functional and presentational currency is the pound sterling.
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions. At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined. Exchange gains and losses are recognised in the Profit and Loss account.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
2.
Accounting policies (continued)
The turnover and operating profit for the year was derived from the Group's principal continuing activity which was carried out wholly within the United Kingdom.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
The Company has unpaid employee remuneration of £11,686,140 (2019: £10,969,835) relating to investments in the share based compensation agreement, available to offset against future profits subject to HM Revenue and Customs approval. No deferred tax asset has been recognised in 2020 due to the unpredictability of the future profit streams.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these Financial Statements. The profit after tax of the parent Company for the year was £
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
Investments in subsidiary undertakings represents the Company's investment in 100% of a dormant subsidiary undertaking, OxAM Nominees Limited.
Other fixed asset investments represent amounts invested in the OxAM Quant Fund as part of a share based compensation arrangement with the Company's employees. The shares are held by the Company according to the terms of the arrangement. The proceeds on disposal of the investments will be payable to the employees and a liability equal to the value of the investment in the Fund (based on the Fund's net assets) at the balance sheet date has been included within accruals.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
Accruals falling due after more than one year represent unvested bonus payments due under the terms of a share based compensation scheme as more fully detailed in noted 2.12 and 10.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
The Group makes contributions into an independently administered pension scheme on behalf of its employees. The pension cost charge represents contributions payable by the Group to the fund and amounted to £1,183,519 (2019: £1,099,330). Contributions totalling £nil (2019: £4,497) were payable to the fund at the balance sheet date.
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NOTES TO THE FINANCIAL STATEMENTS
For the Year Ended 31 March 2020
The Company's directors consider Andre Stern to be the ultimate controlling party.
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