Company Registration No. 06751116 (England and Wales)
ACHIEVE PHARMA UK LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
PAGES FOR FILING WITH REGISTRAR
ACHIEVE PHARMA UK LIMITED
CONTENTS
Page
Balance sheet
1
Statement of changes in equity
2
Notes to the financial statements
3 - 8
ACHIEVE PHARMA UK LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2020
31 December 2020
- 1 -
2020
2019
Notes
£
£
£
£
Fixed assets
Tangible assets
3
4,194
3,206
Current assets
Debtors
4
25,885
12,672
Cash at bank and in hand
16,999
49,156
42,884
61,828
Creditors: amounts falling due within one year
5
(1,439,589)
(1,141,279)
Net current liabilities
(1,396,705)
(1,079,451)
Total assets less current liabilities
(1,392,511)
(1,076,245)
Capital and reserves
Called up share capital
6
1,087,468
1,087,468
Profit and loss reserves
(2,479,979)
(2,163,713)
Total equity
(1,392,511)
(1,076,245)
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.
true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 29 September 2021 and are signed on its behalf by:
Mr R. Stewart
Director
Company Registration No. 06751116
ACHIEVE PHARMA UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2020
- 2 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2019
1,087,468
(1,483,113)
(395,645)
Year ended 31 December 2019:
Loss and total comprehensive income for the year
-
(680,600)
(680,600)
Balance at 31 December 2019
1,087,468
(2,163,713)
(1,076,245)
Year ended 31 December 2020:
Loss and total comprehensive income for the year
-
(316,266)
(316,266)
Balance at 31 December 2020
1,087,468
(2,479,979)
(1,392,511)
ACHIEVE PHARMA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
- 3 -
1
Accounting policies
Company information
Achieve Pharma UK Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
10 Station Road, Henley on Thames, Oxfordshire, RG9 1AY. The business address is Century House, Wargrave Road, Henley on Thames, Oxfordshire. RG9 2LT.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in
sterling, the presentation currency. The
functional currency of the company
is United States Dollars
.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
At the year end t
true
he
C
ompany ha
d
Net Liabilities of £
1,392,511
. However,
the majority of the creditor balance relates to an amount owed to the Company's ultimate parent, Achieve Life Sciences Inc. who has confirmed that it is willing and able to provide continued support and funding to the Company to enable it to continue to operate for at least 12 months from the date of approval of these financial statements.
These accounts have therefore been prepared on a going concern basis.
The impact of the Covid-19 pandemic has also been considered and is not deemed to have had an adverse impact on the Company's future.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business
.
1.4
Tangible fixed assets
Tangible fixed assets
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:
Computer equipment
3 year straight line
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 profit or loss
.
1.5
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
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.
ACHIEVE PHARMA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 4 -
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 profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Cash at bank and in hand
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.
1.7
Financial instruments
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 balance sheet 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.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest
method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
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.
ACHIEVE PHARMA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 5 -
Basic financial liabilities
Basic financial liabilities, including creditors, 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
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts 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 creditors are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
1.8
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.9
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 fixed 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.
1.10
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.11
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the 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
in the period
are included in profit or loss.
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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
ACHIEVE PHARMA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 6 -
3
Tangible fixed assets
Plant and machinery etc
£
Cost
At 1 January 2020
4,797
Additions
1,874
At 31 December 2020
6,671
Depreciation and impairment
At 1 January 2020
1,591
Depreciation charged in the year
886
At 31 December 2020
2,477
Carrying amount
At 31 December 2020
4,194
At 31 December 2019
3,206
4
Debtors
2020
2019
Amounts falling due within one year:
£
£
Other debtors
25,885
12,672
5
Creditors: amounts falling due within one year
2020
2019
£
£
Amounts owed to group undertakings
1,028,031
751,154
Taxation and social security
24,550
40,757
Other creditors
387,008
349,368
1,439,589
1,141,279
ACHIEVE PHARMA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 7 -
6
Called up share capital
2020
2019
£
£
Ordinary share capital
Issued and fully paid
1,087,468 Ordinary £1 Shares of £1 each
1,087,468
1,087,468
7
Audit report information
As the income statement has been omitted from the filing copy of the financial statements
,
the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006
:
The auditor's report was unqualified.
The senior statutory auditor was Simon Thomas ACA and the auditor was Kench & Co Ltd.
8
Events after the reporting date
On 11th August 2021 the Company entered into a formal agreement to issue 2,251,593 Ordinary Shares at par value in exchange for the full and final settlement of amounts owed to Achieve Life Sciences Inc. in a debt for equity swap worth £2,251,593.
9
Related party transactions
At 1 January 20
20
, the
C
ompany owed Extab Corporation £
41,913
.
Extab Corporation is a minority shareholder of Achieve Pharma UK Limited.
During the year
a
n exchange
gain
of £
1,527
(201
9
:
gain
of £
1,163
) arose as a result of restatement of the balance at the year end. At 31 December 20
20
, the
C
ompany owed Extab Corporation £
40,386
.
At 1 January 2020, the Company owed Achieve Life Sciences Inc. £638,530. During the year, Achieve Life Sciences Inc., the Company's ultimate parent Company, made loans including interest to the Company of £1,323,318 (2019: £1,562,002), and Achieve Pharma UK Limited repaid £1,109,139 (2019: £979,786).
An exchange
loss
of £
39,449
(201
9: Loss of
£21,108
) arose as a result of restatement of the balance at the year end. At 31 December 20
20
, the
C
ompany owed
Achieve Life Sciences Inc.
£
892,158.
At 1 January 2020, the Company owed Achieve Life Sciences Technologies Inc. £70,711. Achieve Life Sciences Technologies Inc. is a related party as it's a fellow subsidiary of Achieve Life Sciences Inc. and a shareholder of Achieve Pharma UK Limited. During the year Achieve Life Sciences Technologies Inc. made loans to the Company of £27,353 (2019: £70,711).
An exchange
gain of £2,577 (2019:
loss
of £
36)
arose as a result of restatement of the balance at the year end.
At the year end, the Company owed Achieve Life Sciences Technologies Inc. £95,487.
10
Directors' transactions
During the year the company paid expenses on behalf of a director totalling £245. This amount is still outstanding at the year end.
ACHIEVE PHARMA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 8 -
11
Parent company
The immediate and ultimate parent Company is Achieve Life Sciences Inc. a Company registered in the United States of America, 520 Pike Street,
Suite 2
250, Seattle
, W
ashington,
98
101, USA.