Registration number:
Zvilo Limited
for the Year Ended 31 December 2022
Zvilo Limited
Contents
Company Information |
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Balance Sheet |
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Notes to the Financial Statements |
Zvilo Limited
Company Information
Directors |
Ronald Leslie Boddy Shahem Nidal Samain Admir Imami |
Company secretary |
Avery Law Cosec Ltd |
Registered office |
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Auditors |
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Zvilo Limited
(Registration number: 11342079)
Balance Sheet as at 31 December 2022
Note |
2022 |
2021 |
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Fixed assets |
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Intangible assets |
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- |
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Tangible assets |
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Investments |
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Current assets |
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Debtors |
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Cash at bank and in hand |
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Creditors: Amounts falling due within one year |
( |
( |
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Net current assets |
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Total assets less current liabilities |
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Creditors: Amounts falling due after more than one year |
( |
- |
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Provisions for liabilities |
( |
- |
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Net assets |
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Capital and reserves |
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Called up share capital |
9 |
9 |
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Share premium reserve |
1,058,265 |
714,207 |
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Retained earnings |
(619,476) |
(270,286) |
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Shareholders' funds |
438,798 |
443,930 |
These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.
These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime. As permitted by section 444 (5A) of the Companies Act 2006, the directors have not delivered to the registrar a copy of the Profit and Loss Account.
Approved and authorised by the
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Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
United Kingdom
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A smaller entities - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' and the Companies Act 2006 (as applicable to companies subject to the small companies' regime).
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
Audit report
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Foreign currency transactions and balances
Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
Tax
The tax expense for the period comprises deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Office equipment |
25% straight line |
Business combinations
Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life. No amortisation have been provided for internally developed software which remained under development stage at year end.
Investments
Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Share based payments
The company operates growth shares scheme under the employee share option scheme. Growth shares are non- voting shares initially recognized at their nominal cost on the date of issuance. The growth shares are attached to vesting criteria and only 'vest' once criteria is met, otherwise it can be forfeited. The shares are assigned a 'hurdle rate' and the recipient of the growth shares only participate in value over and above the hurdle rate. At the year end none of the growth shares has been vested.
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Financial instruments
Classification
Recognition and measurement
However, in the specific context of Class B Notes held by the Company, the Board believes that recording these financial assets at face value, rather than discounted present value, provides a more accurate and fair representation of their economic reality. This departure from the standard practice is due to the following unique circumstances:
i) The Class B Notes are funded by an intercompany loan from Zvilo Factor LLC, a subsidiary of the Company. According to the intercompany agreement, Zvilo Factor LLC assumes all the risk on the Class B Notes. In the event of an underlying obligor default, both the Class B Note asset and the intercompany payable are written off simultaneously. Hence, the Company does not contribute any capital or bear any risk for these Notes, and accordingly does not expect a return necessitating discounting.
ii)When the Company reaches £3m of Class B Notes (at nominal face value), they become redeemable upon a 90 day notice. The Company expects that the Class B Notes will reach the £3m threshold by 31/12/2023. Upon reaching this threshold, the Notes will become redeemable, making any prior discounting inappropriate as all discounts would be credited to the Profit & Loss statement in a single instance.
The board therefore believes that discounting these Notes in line with the standard practices would distort the Company's true and fair view. Consequently, the Class B Notes are initially recognised at the transaction price (equivalent to face value) as per the loan agreement, and subsequently measured at amortised cost, excluding the effect of discounting.
Below is a comparison of the financial impact on the company's accounts under the applied policy (no discounting) versus the standard policy (discounting):
With Departure from Standard Policy (Actual)
Financial Asset (Balance Sheet) £222,324
Other Comprehensive Income (P&L) -£Nil
Without Departure from Standard Policy
Financial Asset (Balance Sheet) £181,076
Other Comprehensive Income (P&L) £41,248
Under the standard policy, the discounted amount of £41,248 would gradually unwind in subsequent years, increasing the value of the Financial Asset and crediting the P&L account.
This deviation from standard discounting practices is in accordance with the principle-based approach of FRS 102, ensuring that financial statements present a true and fair view. If circumstances surrounding the Class B Notes or the relevant accounting standards or interpretations change significantly, this accounting policy will be subject to review and possible revision.
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Staff numbers |
The average number of persons employed by the company (including directors) during the year, was
Intangible assets |
Other intangible assets |
Total |
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Cost or valuation |
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Additions internally developed |
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At 31 December 2022 |
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Amortisation |
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Carrying amount |
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At 31 December 2022 |
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Intangible assets includes internally developed software which remained under development phase at the year-end. Therefore, no amortisation has been charged for the year.
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Tangible assets |
Furniture, fittings and equipment |
Total |
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Cost or valuation |
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At 1 January 2022 |
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Additions |
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At 31 December 2022 |
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Depreciation |
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At 1 January 2022 |
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Charge for the year |
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At 31 December 2022 |
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Carrying amount |
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At 31 December 2022 |
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At 31 December 2021 |
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Investments |
2022 |
2021 |
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Investments in subsidiaries |
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Other investments |
222,324 |
- |
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Other investments include investment in Class B Notes issued by Fasanara Securitisation S.A. which have 0% interest rate. This investment is directly related to factoring activity of Zvilo Factor L.L.P in Kosovo which unlocks capital from the Fasanara Securitisation S.A..The notes will be reedeemable on 22 September 2024 in accordance with the Conditions of debt facility argreement, in particular the Principal and Accrued Interest, subject to availability of funds in accordance with the applicable Priority of Payments and to comply with the Conditions with respect to the Notes.
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Subsidiaries |
£ |
Cost or valuation |
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At 1 January 2022 |
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Additions |
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At 31 December 2022 |
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Provision |
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Carrying amount |
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At 31 December 2022 |
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At 31 December 2021 |
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Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Details of undertakings
Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
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2022 |
2021 |
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Subsidiary undertakings |
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Prishtina, Vicianum, Lgj Arberia, Llam. C27, Entrance 283, Floor 1/4 Kosovo |
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Subsidiary undertakings |
Zvilo Facor L.L.C. The principal activity of Zvilo Facor L.L.C. is |
Debtors |
Note |
2022 |
2021 |
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Amounts owed by related parties |
- |
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Other debtors |
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Prepayments |
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Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Creditors |
Creditors: amounts falling due within one year
2022 |
2021 |
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Due within one year |
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Trade creditors |
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- |
Taxation and social security |
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Accruals and deferred income |
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Other creditors |
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Creditors: amounts falling due after more than one year
2022 |
2021 |
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Due after one year |
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Amounts owed to group undertakings |
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- |
Zvilo Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Share capital |
Allotted, called up and fully paid shares
2022 |
2021 |
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No. |
£ |
No. |
£ |
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9.32 |
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8.96 |
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0.89 |
- |
- |
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Share issued during the period include 354,700 ordinary shares and 893,213 Vn shares. Vn shares represent growth shares, which are non- voting shares issued as a form of employee incentive scheme.
Related party transactions |
Summary of transactions with subsidiaries
Zvilo Factor L.L.C. At the balance sheet date, the amount due to/(from) Zvilo Fator L.L.C was £130,425 (2021: (£29,951)). The loan is directly related to purchase of 0% Class B loan notes from Fasanara Securitisation S.A on behalf of Zvilo Factor L.L.C. for factoring activity in Kosovo which unlocks capital from the debt facility for factoring of receivables of Zvilo Factor. Therefore, these loan are also recognised at face value and are repayable once the Class B loan notes are redeemed on 24 September 2024. |
Parent and ultimate parent undertaking |
The company's immediate parent is
The ultimate controlling party is
Off-balance sheet arrangements |
Guarantees
The Company has entered into debt facility arranagment with Fansanra securitasation S.A. acting for and behalf of its compartment AY. The parties of this agreement are Zvilo Limited as originator and guarantor for it's subsidiary Zvilo Factor LLC which acts as servicer.
These guarantees are provided to secure performance obligation required by the contract in the event subsidiary fails to perform it's obligation as servicers and then Zvilo Limited will act as servicer.
As of the balance sheet date, there are no issues regarding the performance of its obligations.