Company Registration No. 02948047 (England and Wales)
SYZYGY UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2017
SYZYGY UK LIMITED
COMPANY INFORMATION
Directors
Mr E Greiner
Mrs C Barber
Mr M A Ellis
Mr P A Stelter
Mr A Stevens (resigned 8 May 2018)
Secretary
Mr E Greiner
Company number
02948047
Registered office
Lacon House
84 Theobalds Road
London
WC1X 8NL
Auditor
KPSR LLP
Chartered Accountants & Registered Auditors
Ground Floor, 4 Churchill Court
58 Station Road
North Harrow
Middlesex
HA2 7SA
SYZYGY UK LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 5
Income statement
6
Statement of comprehensive income
7
Statement of financial position
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 23
SYZYGY UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2017
- 1 -
The directors present the strategic report for the year ended 31 December 2017.
Fair review of the business
In 201
7
we experienced
a marginal increase
in revenue to £
7,428k (2016: £7,327k) due to anticipated more repeat business with existing clients and some new business wins
.
The move of our head offices and delays on a major project has led to a fall in
operating profit by £
773k
to £
51
k. The directors consider the results to be satisfactory considering the
significant work-in-progress at the year-end and the effect of the move of headquarters
. In 201
8,
we anticipate more repeat business with existing clients and
we will
strive for new business wins to underpin stability and growth of the company.
Principal risks and uncertainties
The main financial risks arising from the company's activities are economic risk, currency risk and operating risk. These are stringently monitored by the board of directors and were not considered to be significant at the
end of the reporting period
.
The company's policy in respect of currency risk is to closely monitor exchange rate fluctuations between Sterling, Euro and other major currencies. This may impact the operating profit attained by the company.
The company's policy in respect of economic and operating risk is to manage projects efficiently and exercise tight control on costs.
The company has a high profile client base. However, a downturn could lead to reduced order levels which in turn may impact revenue generated.
Mr E Greiner
Director
18 June 2018
SYZYGY UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2017
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2017.
Principal activities
The principal activity of the company was that of provision of integrated portfolio of corporate internet solutions, from strategic consulting to project planning, concepts, designs and technical realisation.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr E Greiner
Mrs C Barber
Mr M A Ellis
Mr P A Stelter
Mr A Stevens (resigned 8 May 2018)
Results and dividends
The results for the year are set out on page 6.
The directors
did not recommend
a dividend
.
(201
6 - £800,000
).
Post reporting date events
There are no matters that give rise to a post balance sheet event.
Future developments
The directors are confident that the success of the business will continue and new awards of projects that commence in 201
8
will underpin the long term stability and growth of the company.
Auditor
KPSR LLP
were appointed auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Mr E Greiner
Director
18 June 2018
SYZYGY UK LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2017
- 3 -
The directors are responsible for preparing the
Annual
Report 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
- select suitable accounting policies 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 company 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 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
SYZYGY UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SYZYGY UK LIMITED
- 4 -
Opinion
We have audited the financial statements of Syzygy UK Limited
(the 'company')
for the year ended 31 December 2017 which comprise
the Income Statement, the Statement of Comprehensive Income, the Statement Of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and 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 FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
-
give a true and fair view of the state of the company's affairs as at 31 December 2017 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard
, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
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 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 auditor’s 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the 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 Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
SYZYGY UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SYZYGY UK LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the Strategic Report and the Directors' Report
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Directors' Responsibilities Statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
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 auditor’s 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: http://www.frc.org.uk/auditorsresponsibilities
.
This description forms part of our auditor’s 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 auditor's 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.
Kailesh Patel (Senior Statutory Auditor)
for and on behalf of KPSR LLP
18 June 2018
Chartered Accountants
Statutory Auditors
Ground Floor, 4 Churchill Court
58 Station Road
North Harrow, Middlesex
HA2 7SA
SYZYGY UK LIMITED
INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2017
- 6 -
2017
2016
Notes
£
£
Revenue
3
7,427,860
7,327,053
Cost of sales
(5,392,651)
(4,617,982)
Gross profit
2,035,209
2,709,071
Administrative expenses
(1,979,187)
(1,924,383)
Other operating (expenses)/income
(5,429)
39,772
Operating profit
4
50,593
824,460
Investment income
7
2,127
493
Profit before taxation
52,720
824,953
Tax on profit
8
(24,293)
(153,675)
Profit for the financial year
28,427
671,278
The Income Statement has been prepared on the basis that all operations are continuing operations.
SYZYGY UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2017
- 7 -
2017
2016
£
£
Profit for the year
28,427
671,278
Other comprehensive income
-
-
Total comprehensive income for the year
28,427
671,278
SYZYGY UK LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2017
31 December 2017
- 8 -
2017
2016
Notes
£
£
£
£
Fixed assets
Intangible assets
10
16,052
6,958
Property, plant and equipment
11
1,691,888
192,611
1,707,940
199,569
Current assets
Trade and other receivables
13
2,235,546
2,350,541
Cash and cash equivalents
787,685
831,303
3,023,231
3,181,844
Current liabilities
14
(3,004,465)
(1,707,427)
Net current assets
18,766
1,474,417
Total assets less current liabilities
1,726,706
1,673,986
Provisions for liabilities
16
(35,498)
(11,205)
Net assets
1,691,208
1,662,781
Equity
Called up share capital
17
1,000
1,000
Retained earnings
1,690,208
1,661,781
Total equity
1,691,208
1,662,781
The financial statements were approved by the board of directors and authorised for issue on 18 June 2018 and are signed on its behalf by:
Mr E Greiner
Mrs C Barber
Director
Director
Company Registration No. 02948047
SYZYGY UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2017
- 9 -
Share capital
Retained earnings
Total
Notes
£
£
£
Balance at 1 January 2016
1,000
1,790,503
1,791,503
Year ended 31 December 2016:
Profit and total comprehensive income for the year
-
671,278
671,278
Dividends
9
-
(800,000)
(800,000)
Balance at 31 December 2016
1,000
1,661,781
1,662,781
Year ended 31 December 2017:
Profit and total comprehensive income for the year
-
28,427
28,427
Balance at 31 December 2017
1,000
1,690,208
1,691,208
SYZYGY UK LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2017
- 10 -
2017
2016
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
22
1,801,579
1,468,427
Income taxes paid
(168,438)
(141,343)
Net cash inflow from operating activities
1,633,141
1,327,084
Investing activities
Purchase of intangible assets
(24,719)
(13,661)
Purchase of property, plant and equipment
(1,654,167)
(160,096)
Interest received
2,127
493
Net cash used in investing activities
(1,676,759)
(173,264)
Financing activities
Dividends paid
-
(800,000)
Net cash used in financing activities
-
(800,000)
Net (decrease)/increase in cash and cash equivalents
(43,618)
353,820
Cash and cash equivalents at beginning of year
831,303
477,483
Cash and cash equivalents at end of year
787,685
831,303
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2017
- 11 -
1
Accounting policies
Company information
Syzygy UK Limited
("the company")
is a limited company domiciled and incorporated in England and Wales.
The registered office is
Lacon House, 84 Theobalds Road, London, WC1X 8NL.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 and FRC Abstracts.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements are prepared on a going concern basis, under the historical cost convention.
The preparation of financial statements in conformity with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 2.
1.2
Going concern
A
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Revenue
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for services rendered, stated net of discounts and Value Added Tax. When the consideration receivable in cash or cash equivalents is deferred, and the arrangement constitutes in effect a financing transaction, the fair value of the consideration is measured at the present value of all future receipts determined using an imputed rate of interest, normally the rate that discounts the nominal amount of consideration to the cash sales price. In respect of the rendering of services, turnover represents revenue measured by reference to the stage of completion of the contract activity or the service transaction at the end of the reporting period.
Rendering of Services
When the outcome of a project contract can be estimated reliably in terms of completion, future costs to complete and collectability of billings, the Company recognises revenue and expenses on the contract by reference to the stage of completion of the contract at the end of the reporting period. The stage of completion is determined on the basis of the proportion of the contact costs incurred and time spent to date over the total contract.
Interest Income
Interest income is recognised using the effective interest method.
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
1
Accounting policies
(Continued)
- 12 -
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date if the fair value can be measured reliably.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software licences
Straight line over the life of the licence
1.5
Property, plant and equipment
Property, plant and equipment
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings short leasehold
Straight line over the life of the lease, over 10 years
Fixtures and fittings
33% on cost
Computer equipment
33% on cost
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to the income statement
.
1.6
Impairment of non-current assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
and intangible 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). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell 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 assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in
the income statement
, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
1
Accounting policies
(Continued)
- 13 -
1.8
Financial assets
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Loans and receivables
Trade receivables
, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through the income statement
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the income statement.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
1
Accounting policies
(Continued)
- 14 -
1.9
Financial liabilities
Basic financial liabilities
,
including trade and other payables, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at market rate of interest
.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective rate method.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Other financial liabilities
Derivatives, including interest swaps and foreign exchange contracts, are not financial instruments. Derivatives are initially recognised at fair value on the date a derivative is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.10
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current 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. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end 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 calculated at 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. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
The company operates a defined contribution scheme. Contributions payable are charged to the
income statement
in the year they are payable.
1.14
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
the income statement
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.
1.15
Foreign exchange
Transactions in currencies other than pound sterling are recorded at the rates of exchange prevailing at dates of the transactions
.
At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated
at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the income statement for the period.
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
- 16 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are 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.
3
Revenue
An analysis of the company's revenue is as follows:
2017
2016
£
£
Revenue analysed by class of business
Design and build revenue
7,427,860
7,327,053
2017
2016
£
£
Other significant revenue
Interest income
2,127
493
2017
2016
£
£
Revenue analysed by geographical market
United Kingdom
1,375,688
1,956,677
Europe
4,813,694
3,857,759
Rest of the World
1,238,478
1,512,617
7,427,860
7,327,053
4
Operating profit
2017
2016
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange losses/(gains)
5,429
(39,772)
Fees payable to the company's auditors for the audit of the company's financial statements
17,030
18,280
Depreciation of owned property, plant and equipment
154,892
148,164
Amortisation of intangible assets
15,625
12,189
Operating lease charges
1,043,196
533,339
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
- 17 -
5
Auditor's remuneration
2017
2016
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
17,030
18,280
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2017
2016
Number
Number
Administrative
1
2
Production and development
59
57
60
59
Their aggregate remuneration comprised:
2017
2016
£
£
Wages and salaries
3,412,820
3,559,394
Social security costs
384,405
395,377
Pension costs
60,239
54,333
3,857,464
4,009,104
7
Investment income
2017
2016
£
£
Interest income
Interest on bank deposits
2,127
493
Investment income includes the following:
Interest on financial assets not measured at fair value through profit or loss
2,127
493
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
- 18 -
8
Taxation
2017
2016
£
£
Current tax
UK corporation tax on profits for the current period
-
145,981
Adjustments in respect of prior periods
-
(2,386)
Total current tax
-
143,595
Deferred tax
Origination and reversal of timing differences
24,293
10,080
Total tax charge
24,293
153,675
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2017
2016
£
£
Profit before taxation
52,720
824,953
Expected tax charge based on the standard rate of corporation tax in the UK of 19.25% (2016: 20.00%)
10,149
164,991
Tax effect of expenses that are not deductible in determining taxable profit
35,754
1,554
Adjustments in respect of prior years
-
(2,386)
Group relief
17,197
(11,827)
Permanent capital allowances in excess of depreciation
(63,100)
(8,983)
Under/(over) provided in prior years
-
246
Deferred taxation
24,293
10,080
Taxation charge for the year
24,293
153,675
9
Dividends
2017
2016
£
£
Interim paid
-
800,000
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
- 19 -
10
Intangible fixed assets
Software
£
Cost
At 1 January 2017
55,028
Additions - separately acquired
24,719
At 31 December 2017
79,747
Amortisation and impairment
At 1 January 2017
48,070
Amortisation charged for the year
15,625
At 31 December 2017
63,695
Carrying amount
At 31 December 2017
16,052
At 31 December 2016
6,958
11
Property, plant and equipment
Land and buildings short leasehold
Fixtures and fittings
Computer equipment
Total
£
£
£
£
Cost
At 1 January 2017
105,486
669,796
469,134
1,244,416
Additions
1,252,319
167,862
233,986
1,654,167
Disposals
(80,486)
(649,380)
(305,576)
(1,035,442)
At 31 December 2017
1,277,319
188,278
397,544
1,863,141
Depreciation and impairment
At 1 January 2017
82,119
622,978
346,706
1,051,803
Depreciation charged in the year
28,875
50,634
75,383
154,892
Eliminated in respect of disposals
(80,486)
(649,380)
(305,576)
(1,035,442)
At 31 December 2017
30,508
24,232
116,513
171,253
Carrying amount
At 31 December 2017
1,246,811
164,046
281,031
1,691,888
At 31 December 2016
23,367
46,816
122,428
192,611
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
- 20 -
12
Financial instruments
2017
2016
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
1,912,346
2,008,694
Carrying amount of financial liabilities
Measured at amortised cost
2,885,009
1,516,031
Unless otherwise stated all financial instruments have been classified as level 2 on the fair value hierarchy. Level 2 means the inputs for the assets and liabilities are not quoted prices but are observable, either directly (that is, as prices) or indirectly (that is, derived from prices).
13
Trade and other receivables
2017
2016
Amounts falling due within one year:
£
£
Trade receivables
1,028,959
1,569,222
Corporation tax recoverable
107,613
-
Amounts owed by group undertakings
-
16,509
Other receivables
226,367
422,963
Prepayments and accrued income
872,607
341,847
2,235,546
2,350,541
14
Current liabilities
2017
2016
£
£
Trade payables
237,187
148,739
Amounts due to group undertakings
1,529,964
533,642
Corporation tax
-
60,825
Other taxation and social security
119,456
130,571
Accruals and deferred income
1,117,858
833,650
3,004,465
1,707,427
15
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2017
2016
Balances:
£
£
ACAs
35,498
11,205
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
15
Deferred taxation
(Continued)
- 21 -
2017
Movements in the year:
£
Liability at 1 January 2017
11,205
Charge to profit or loss
24,293
Liability at 31 December 2017
35,498
The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.
16
Provisions for liabilities
2017
2016
Notes
£
£
Deferred tax liabilities
15
35,498
11,205
17
Share capital
2017
2016
£
£
Ordinary share capital
Issued and fully paid
100,000 Ordinary shares of 1p each
1,000
1,000
18
Retirement benefit schemes
2017
2016
Defined contribution schemes
£
£
Charge to income statement in respect of defined contribution schemes
60,239
54,333
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Operating lease commitments
Lessee
The company entered into a 10 year operating lease for use of its current office space which expires in August 2027. A rent review date exists in August 2022. A rent free period was granted from the landlord until July 2019.
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
19
Operating lease commitments
(Continued)
- 22 -
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2017
2016
£
£
Within one year
-
397,500
Between two and five years
3,690,232
-
In over five years
4,832,447
-
8,522,679
397,500
20
Controlling party
The Company's immediate parent company is Unique Digital Marketing Limited, a company incorporated in England. Unique Digital Marketing is controlled by Syzygy AG, a listed company incorporated in Germany. The directors regard Syzygy AG as the ultimate parent company.
Copies of the financial statements of the parent company are available from Investor Relations at Syzygy AG, Horexstraße 28, 61352 Bad Homburg vor der Höhe, Germany
The ultimate controlling party is WPP Plc a company fully listed on the London Stock Exchange, copies of this company's financial statements are available from WPP Plc, Queenway House, Hilgrove Street, St.Helier, Jersey JE1 1ES.
21
Directors' remuneration
2017
2016
£
£
Remuneration for qualifying services
216,219
188,790
Company pension contributions to defined contribution schemes
5,198
5,136
221,417
193,926
Remuneration disclosed above include the following amounts paid to the highest paid director:
Remuneration for qualifying services
201,719
179,688
Company pension contributions to defined contribution schemes
4,950
4,406
Accrued lump sum at the end of the year
13,750
36,719
SYZYGY UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2017
- 23 -
22
Cash generated from operations
2017
2016
£
£
Profit for the year after tax
28,427
671,278
Adjustments for:
Taxation charged
24,293
153,675
Investment income
(2,127)
(493)
Amortisation and impairment of intangible assets
15,625
12,189
Depreciation and impairment of property, plant and equipment
154,892
148,164
Movements in working capital:
Decrease/(increase) in trade and other receivables
349,129
(433,364)
Increase in trade and other payables
1,231,341
916,979
Cash generated from operations
1,801,579
1,468,427
2017-12-31
2017-01-01
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