Company registration number 11632462 (England and Wales)
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
COMPANY INFORMATION
Directors
S Kulechov
N Butler
(Appointed 1 August 2023)
P D Kerr
(Appointed 1 August 2023)
Company number
11632462
Registered office
128 City Road
London
EC1V 2NX
Auditor
BKL Audit LLP
Chartered Accountants
5 Fleet Place
London
EC4N 7RD
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 22
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Fair review of the business
A summary of the period's trading results is given on 9. The company's turnover has decreased from prior year by 26% because of changes in the wider group's structure. This has led to a reduced number of expenses being incurred by Push Labs Limited (formerly Aave Limited) that are then recharged out to group companies and therefore reducing revenue received into Push Labs Limited.
The company continued to design and build its electronic money issuing solution following the grant by the FCA of an Electronic Money Institute (EMI) licence in July 2020.
In August 2023, two new directors were appointed to the Board.
During 2023, 3 ordinary shares were issued for total consideration of £8,318,505.
Principal risks and uncertainties
Aside from the risks that exist in the software development sector, the key business risks facing the company are:
Credit Risk
As the company’s revenue is entirely derived from a small number of group clients, there is a risk of default in the receipt of revenue from that counter party. This risk is managed through regular dialogue to ensure the company maintains sufficient working capital to meet its liabilities as they fall due.
Currency Risk
The company is exposed to fluctuations of sterling against other currencies or cryptocurrencies. Management review this risk on a regular basis.
Key performance indicators
Key performance indications are as follows:
2023 2022
£ £
Revenue 3,285,806 4,440,908
Profit/(loss) for the financial year (3,783,143) (1,632,870)
Net assets/(liabilities) 3,089,459 (1,445,903)
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Statement by the directors in performance of their duties in accordance with s172(1) Companies Act 2006
The directors of the company, as those of all UK companies, must act in accordance with a set of general duties. These duties are detailed in section 172 of the UK Companies Act 2006 and include a duty to promote the success of the company and are summarised as follows:
'A director of a company must act in the way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:
the likely consequences of any decision in the long term,
the interests of the company's employees,
the need to foster the company's business relationships with suppliers, customers and others,
the impact of the company's operations on the community and the environment,
the desirability of the company maintaining a reputation for high standards of business conduct, and
the need to act fairly as between members of the company.’
The following paragraphs summarise how the directors fulfil their duties:
Risk Management
We provide software development services to our clients across multiple jurisdictions. As we grow, our business and our risk environment also becomes more complex. It is therefore vital that we effectively identify, evaluate, manage and mitigate the risks we face, and that we continue to evolve our approach to risk management. Alongside the principal risks set out on page 1 we engage external consultants and advisors to ensure that we monitor and maintain an effective oversight of regulatory changes and compliance with our ongoing legal and regulatory requirements.
Our People
The company is committed to being a responsible business. Our behaviour is aligned with the expectations of our people, clients and the community as a whole. People are fundamental to our business so, in order to succeed, we need to manage our people’s performance and develop their talent whilst rewarding them appropriately and ensuring we operate as efficiently as possible. Alongside this we look to share common values that inform and guide our behaviour so that we achieve our goals in the right way. Being a relatively small company with just over 10 employees we achieve this through regular dialogue and events with employees which allows all staff to share our common values.
Business Relationships
As a key requirement for building the business of the company, the Board is very aware of the need to foster good relationships with clients, the community and other important stakeholders. The Board looks to discharge these duties by engaging in regular dialogue with both customers and service providers and attending industry events to further build and gain new relationships with key people within the industry.
Community and Environment
The company’s approach is to use our position as a software developer to ensure that we interact with our local communities in a beneficial and environmentally friendly manner. The company also looks to make a positive impact on under privileged parts of society through regular charitable donations.
Maintaining a reputation for high standards of business conduct
As directors, our intention is to behave responsibly and ensure that management operate the business in a responsible manner, operating within the high standards of business conduct and good governance expected for a business such as ours and, which in doing so, will help the business grow over the coming years.
S Kulechov
Director
12 April 2024
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of software development.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
S Kulechov
N Butler
(Appointed 1 August 2023)
P D Kerr
(Appointed 1 August 2023)
Energy and carbon report
As the company has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the 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 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; and
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.
Strategic report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial risk management.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
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
S Kulechov
Director
12 April 2024
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF PUSH LABS LIMITED
- 5 -
Opinion
We have audited the financial statements of Push Labs Limited (the 'company') for the period ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including 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).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its loss 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
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF PUSH LABS LIMITED
- 6 -
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 identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which 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 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Capability of the audit in detecting irregularities, including fraud:
Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to the failure to comply with tax regulations, health and safety regulations, anti-bribery and anti-corruption laws, and Electronic Money Regulations and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management's incentives and opportunities for fraud manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries and management bias in accounting estimates. Audit procedures performed by the auditors included:
There are inherent limitations in the audit procedures described above, and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF PUSH LABS LIMITED
- 7 -
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Katherine Rose FCCA (Senior Statutory Auditor)
For and on behalf of BKL Audit LLP
16 April 2024
Chartered Accountants and Statutory Auditor
5 Fleet Place
London
EC4N 7RD
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
2
3,285,806
4,440,908
Cost of sales
(2,644,792)
(2,513,319)
Gross profit
641,014
1,927,589
Administrative expenses
(4,437,608)
(3,962,132)
Other operating income
1,696
444,079
Operating loss
3
(3,794,898)
(1,590,464)
Interest payable and similar expenses
7
(62,738)
Other gains and losses
8
11,755
20,332
Loss before taxation
(3,783,143)
(1,632,870)
Tax on loss
9
Loss for the financial year
(3,783,143)
(1,632,870)
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
11,240
11,240
Tangible assets
12
7,714
18,954
11,240
Current assets
Debtors
13
1,847,958
2,732,118
Cash at bank and in hand
2,371,823
1,343,963
4,219,781
4,076,081
Creditors: amounts falling due within one year
14
(1,149,276)
(5,533,224)
Net current assets/(liabilities)
3,070,505
(1,457,143)
Net assets/(liabilities)
3,089,459
(1,445,903)
Capital and reserves
Called up share capital
16
308,815
308,814
Share premium account
8,318,504
Profit and loss reserves
(5,537,860)
(1,754,717)
Total equity
3,089,459
(1,445,903)
The financial statements were approved by the board of directors and authorised for issue on 12 April 2024 and are signed on its behalf by:
S Kulechov
Director
Company registration number 11632462 (England and Wales)
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2022
308,814
(121,847)
186,967
Year ended 31 December 2022:
Loss and total comprehensive income
-
-
(1,632,870)
(1,632,870)
Balance at 31 December 2022
308,814
(1,754,717)
(1,445,903)
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
(3,783,143)
(3,783,143)
Issue of share capital
16
1
8,318,504
-
8,318,505
Balance at 31 December 2023
308,815
8,318,504
(5,537,860)
3,089,459
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
20
(7,288,160)
679,251
Interest paid
(62,738)
Net cash (outflow)/inflow from operating activities
(7,288,160)
616,513
Investing activities
Purchase of intangible assets
(8,990)
Purchase of tangible fixed assets
(14,240)
(4,280)
Net proceeds from additions and disposals of crypto currency
11,755
20,332
Net cash (used in)/generated from investing activities
(2,485)
7,062
Financing activities
Proceeds from issue of shares
8,318,505
Net cash generated from/(used in) financing activities
8,318,505
-
Net increase in cash and cash equivalents
1,027,860
623,575
Cash and cash equivalents at beginning of year
1,343,963
788,061
Effect of foreign exchange rates
(67,673)
Cash and cash equivalents at end of year
2,371,823
1,343,963
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
Push Labs Limited is a private company limited by shares incorporated in England and Wales. The registered office is 128 City Road, London, EC1V 2NX.
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.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts 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
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover consists of intercompany services performed in respect of software development. Revenue for the period is based on project related costs recharged at a mark-up of 10%.
Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
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 where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
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:
Patents and licences
20% on cost
1.5
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:
Plant and equipment
2 years on a straight line basis
Fixtures and fittings
25% reducing basis
Computers
25% reducing basis
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
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 statement of income.
1.6
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.
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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through the statement of income, 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 statement of income.
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 the statement of income.
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.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
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.
Basic financial liabilities
Basic financial liabilities, including creditors and loans from fellow group companies, 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 payments 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. Amounts 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.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract 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.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
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.
1.9
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
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.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
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
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Software development
3,285,806
4,440,908
2023
2022
£
£
Turnover analysed by geographical market
Europe
260,184
419,148
Rest of World
2,907,376
3,838,866
United Kingdom
118,246
182,894
3,285,806
4,440,908
2023
2022
£
£
Other revenue
Sale of IP
-
444,079
In the prior year, as part of an intra-group internal reorganisation, Push Labs Limited sold the IP of 'Social Graph' to its parent Avara Labs Cayman Holdings SEZC for consideration of £444,079.
3
Operating loss
2023
2022
Operating loss for the year is stated after charging:
£
£
Exchange losses
113,663
56,183
Depreciation of owned tangible fixed assets
6,526
-
Impairment of owned tangible fixed assets
45,307
All items are included within administrative expenses.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
34,000
28,500
For other services
Taxation compliance services
2,500
2,500
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Software development
7
13
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
2,140,966
2,411,480
Social security costs
278,175
315,941
Pension costs
77,659
59,168
2,496,800
2,786,589
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
824,004
693,503
Company pension contributions to defined contribution schemes
32,559
18,532
856,563
712,035
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
433,138
693,503
Company pension contributions to defined contribution schemes
32,559
18,532
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest payable to group undertakings
62,738
8
Other gains and losses
2023
2022
£
£
Profit/(loss) from cryptocurrency exchange
11,755
20,332
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
9
Taxation
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(3,783,143)
(1,632,870)
Expected tax credit based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
(889,039)
(310,245)
Tax effect of expenses that are not deductible in determining taxable profit
709
19,156
Unutilised tax losses carried forward
888,973
291,089
Permanent capital allowances in excess of depreciation
(2,060)
Provisions movement timing difference
1,417
Taxation charge for the year
-
-
The company has estimated UK tax losses of £5,470,000 (2022 £1,680,000) available for carry forward against future profits.
10
Impairments
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
2023
2022
Notes
£
£
In respect of:
Property, plant and equipment
12
45,307
Recognised in:
Administrative expenses
-
45,307
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
11
Intangible fixed assets
Patents and licences
£
Cost
At 1 January 2023 and 31 December 2023
13,990
Amortisation and impairment
At 1 January 2023 and 31 December 2023
2,750
Carrying amount
At 31 December 2023
11,240
At 31 December 2022
11,240
12
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computers
Total
£
£
£
£
Cost
At 1 January 2023
8,291
44,047
52,338
Additions
14,240
14,240
Disposals
(8,291)
(44,047)
(52,338)
At 31 December 2023
14,240
14,240
Depreciation and impairment
At 1 January 2023
8,291
44,047
52,338
Depreciation charged in the year
6,526
6,526
Eliminated in respect of disposals
(8,291)
(44,047)
(52,338)
At 31 December 2023
6,526
6,526
Carrying amount
At 31 December 2023
7,714
7,714
At 31 December 2022
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
13
Debtors
2023
2022
£
£
Amounts falling due within one year:
Amounts owed by group undertakings
1,476,240
2,442,989
Other debtors
292,982
199,190
Prepayments and accrued income
78,736
89,939
1,847,958
2,732,118
14
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
51,023
63,701
Amounts owed to group undertakings
467,692
4,862,866
Other creditors
630,561
606,657
1,149,276
5,533,224
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
77,659
59,168
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.
16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of €0.35 each
1,000,003
1,000,000
308,815
308,814
Ordinary shares have attached to them full voting rights, dividend and capital distribution (including on winding up) rights; they do not confer any rights of redemption.
On 13 January 2023, 1 ordinary share was issued for total consideration of £3,818,505.
On 13 June 2023, 1 ordinary share was issued for total consideration of £2,500,000.
On 8 December 2023, 1 ordinary share was issued for total consideration of £2,000,000.
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
17
Financial commitments, guarantees and contingent liabilities
In the normal course of the company's business, claims, disputes and legal proceedings may be brought against the company arising out of current or past operations. Legal proceedings have been commenced against the company by three former group employees. The company is defending the claims. At the present time, it is not clear what, if any, claim will be settled and the legal representatives of the company are not currently able to estimate the quantum of such claims.
18
Related party transactions
Transactions with related parties
During the year, the parent company was Avara Labs Cayman Holdings SEZC whose ultimate controlling party is the director S Kulechov. The company entered into transactions with companies whose ultimate controlling party is also S Kulechov and are therefore related party transactions.
The company has taken advantage of the exemption available in accordance with Section 33.1A of Financial Reporting Standard 102 whereby it has not disclosed transactions entered into between two or more members of a group, as the company is a wholly owned subsidiary undertaking of the group to which it is party to the transactions.
19
Ultimate controlling party
The company's immediate parent company is Avara Labs Cayman Holdings SEZC, a company incorporated in the Cayman islands with registered office 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008.
The company's ultimate parent company is Bear Holdings (Cayman) Limited, a company incorporated in the Cayman islands with registered office 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008.
The smallest and largest group for which consolidated accounts have been prepared is that headed by Avara Labs Cayman Holdings SEZC. Copies of the consolidated accounts are available from 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008.
The ultimate controlling party is S Kulechov.
20
Cash (absorbed by)/generated from operations
2023
2022
£
£
Loss for the year after tax
(3,783,143)
(1,632,870)
Adjustments for:
Finance costs
62,738
Depreciation and impairment of tangible fixed assets
6,526
45,307
Foreign exchange gains on cash equivalents
-
67,673
Other gains and losses
(11,755)
(20,332)
Movements in working capital:
Decrease/(increase) in debtors
884,160
(1,611,822)
(Decrease)/increase in creditors
(4,383,948)
3,988,956
Decrease in deferred income
-
(220,399)
Cash (absorbed by)/generated from operations
(7,288,160)
679,251
PUSH LABS LIMITED
(FORMERLY AAVE LIMITED)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
21
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
1,343,963
1,027,860
2,371,823
2023-12-312023-01-01falseCCH SoftwareCCH Accounts Production 2024.100S KulechovN ButlerP D Kerrfalsetruefalse116324622023-01-012023-12-3111632462bus:Director12023-01-012023-12-3111632462bus:Director22023-01-012023-12-3111632462bus:Director32023-01-012023-12-3111632462bus:RegisteredOffice2023-01-012023-12-31116324622023-12-31116324622022-01-012022-12-3111632462core:RetainedEarningsAccumulatedLosses2022-01-012022-12-3111632462core:RetainedEarningsAccumulatedLosses2023-01-012023-12-3111632462core:OtherResidualIntangibleAssets2023-12-3111632462core:OtherResidualIntangibleAssets2022-12-3111632462core:PatentsTrademarksLicencesConcessionsSimilar2023-12-3111632462core:PatentsTrademarksLicencesConcessionsSimilar2022-12-31116324622022-12-3111632462core:PlantMachinery2023-12-3111632462core:FurnitureFittings2023-12-3111632462core:ComputerEquipment2023-12-3111632462core:PlantMachinery2022-12-3111632462core:FurnitureFittings2022-12-3111632462core:ComputerEquipment2022-12-3111632462core:CurrentFinancialInstrumentscore:WithinOneYear2023-12-3111632462core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-3111632462core:CurrentFinancialInstruments2023-12-3111632462core:CurrentFinancialInstruments2022-12-3111632462core:ShareCapital2023-12-3111632462core:ShareCapital2022-12-3111632462core:SharePremium2023-12-3111632462core:SharePremium2022-12-3111632462core:RetainedEarningsAccumulatedLosses2023-12-3111632462core:RetainedEarningsAccumulatedLosses2022-12-3111632462core:ShareCapital2021-12-3111632462core:SharePremium2021-12-3111632462core:RetainedEarningsAccumulatedLosses2021-12-3111632462core:ShareCapital2023-01-012023-12-3111632462core:SharePremium2023-01-012023-12-31116324622022-12-31116324622021-12-3111632462core:IntangibleAssetsOtherThanGoodwill2023-01-012023-12-3111632462core:PatentsTrademarksLicencesConcessionsSimilar2023-01-012023-12-3111632462core:PlantMachinery2023-01-012023-12-3111632462core:FurnitureFittings2023-01-012023-12-3111632462core:ComputerEquipment2023-01-012023-12-3111632462core:UKTax2023-01-012023-12-3111632462core:UKTax2022-01-012022-12-311163246212023-01-012023-12-311163246212022-01-012022-12-3111632462core:PatentsTrademarksLicencesConcessionsSimilar2022-12-3111632462core:PlantMachinery2022-12-3111632462core:FurnitureFittings2022-12-3111632462core:ComputerEquipment2022-12-3111632462bus:PrivateLimitedCompanyLtd2023-01-012023-12-3111632462bus:FRS1022023-01-012023-12-3111632462bus:Audited2023-01-012023-12-3111632462bus:FullAccounts2023-01-012023-12-31xbrli:purexbrli:sharesiso4217:GBP