Company Registration No. 12071484 (England and Wales)
Get Back Pictures Limited
Annual report and financial statements
for the period ended 31 December 2022
Get Back Pictures Limited
Company information
Director
Charles Light
Secretary
Abogado Nominees Limited
Company number
12071484
Registered office
100 New Bridge Street
London
EC4V 6JA
Independent auditor
Saffery LLP
71 Queen Victoria Street
London
EC4V 4BE
Get Back Pictures Limited
Contents
Page
Strategic report
1 - 3
Director's report
4 - 8
Independent auditor's report
9 - 12
Statement of comprehensive income
13
Statement of financial position
14
Statement of changes in equity
15
Notes to the financial statements
16 - 24
Get Back Pictures Limited
Strategic report
For the period ended 31 December 2022
Page 1
The director presents the strategic report and audited financial statements of the Company for the period ended 31 December 2022.
Fair review of the business
The principal activity of the Company is that of film production activities. The director does not envisage any change in the principal activity during the forthcoming year.
The profit for the year, after taxation, amounted to of £12,230 during the year (May 2022: £19,057). The director does not recommend the payment of a dividend in respect of the financial period ended 31 December 2022.
Principle risks and uncertainties
The Netflix group manages business and financial risk and uncertainties at group level, rather than on an individual company basis and for this reason the director believes that the Company has reduced exposure to business and financial risks.
Key performance indicators
The director considers the company's key financial performance indicator to be whether the programmes is produced in line with the production budget. At the year end, the production had an estimated final cost in line with the agreed budget.
SECTION 172 (1) Statement
The Director is cognisant of his duties under the Companies Act 2006, and throughout the year he has acted in the way that he considers, in good faith, will be most likely to promote the long-term success of the Company. The Director has had regard to the matters set out in s.172(1)(a)-(f) of the Companies Act. The below paragraphs describe how the Director has specifically considered the matters set out in s.172:
a. The likely consequences of any decision in the long term:
Netflix operates globally and our unique culture gives teams the freedom and responsibility to make decisions with confidence. As such, direction and decision-making are decentralised allowing the business to move fast. The Director has regard to how the likely long-term consequences of any decision will impact the Company’s key stakeholders being its employees, other Netflix Group companies (the ‘Netflix Group’), shareholders, the community, environment and suppliers.
b. The interests of the Company's employees:
Get Back Pictures Limited has a dedicated production HR lead from the Netflix Group who meets with the Executive Producers prior to the production start date to determine what is needed from a HR perspective.
Production HR works with productions to ensure the safest and most respectful production experience for all teams working on Netflix productions. Once the show is in production then HR are on set on a regular basis. There is also a confidential reporting hotline that production employees can use for all employee-related matters.
Get Back Pictures Limited
Strategic report (continued)
For the period ended 31 December 2022
Page 2
Workplace options are available to anyone working on a Netflix production which offer wellbeing support. There are options focused on emotional, physical and practical wellbeing which include up to 6 sessions with a counsellor virtually, family resources and advice and help for staying fit and healthy. Options focused on areas of support include resources for financial well-being, legal resources, inclusion and belonging, legal resources, stress and anxiety and a healthy lifestyle.
As per the Company’s Commitment to Respect, it’s critically important that employees are treated equally, respectfully and feel safe in the workplace. We’re committed to inclusion and diversity in every aspect of the production, including recruitment, hiring, placement, job assignment, compensation, promotion, transfer, benefits and training. As part of our policy and Commitment to Respect, the production receive the following:
Training and Development - access to a variety of different coaching and training materials for those who work on the production. This ranges from leadership training, to inclusion on set. Production HR will also be made aware of any non english language requirements or accessibility needs, so that they can accommodate them.
Filmmaker Introduction - a session for the Senior Leadership on the Production, which includes Netflix Creatives and Production Execs, and covers: how we work together, respect in the workplace, and the importance of inclusion and diversity.
Heads of Department (HoD) Training - a workshop style session aimed at HoDs and supervisors which covers leadership skills, the importance of leading inclusively, and respect in the workplace.
Respect@ training - a focused session on Anti-Harassment, Discrimination, Bullying/Abusive conduct, Inclusion and Diversity issues and Retaliation. This is given to cast and non supervisory crew members.
c. The need to foster the Company's business relationships with suppliers and customers
In line with the Group’s decentralised approach, authority for operational decision making is delegated to management on a day-to-day basis. Management builds and develops relationships with suppliers and other key stakeholders by maintaining communication and good practice based on the Netflix Group Code of Ethics (available here: https://ir.netflix.net/governance) and the Netflix Supplier Code of Conduct (available here: https://netflix.com/supplier-code-of-conduct).
The team receives a production manual, in which there is global ethics and compliance information and anti-corruption training. Furthermore, HoDs will also have live anti-corruption training.
d. Community engagement and the impact of the Company's operations on the environment
The Netflix Group are committed to investing in the UK creative industry by playing a leading role in bridging the skills gap, upskilling the UK creative community, and improving diversity head-on. The Grow Creative Initiative was started toward the end of 2019, and Netflix is now investing £1.2m a year in a training programme for the screen sector that will help develop and support the careers and training of up to 1,000 people across the UK through our own productions, our partners and educational institutions. Grow Creative UK’s focus is on upskilling below-the-line new and emerging British talent, especially those from diverse backgrounds. The programme forms part of Netflix's long term ambition to provide the most impactful training opportunities across High End TV and Film in the UK.
We are also developing a more inclusive pipeline of upcoming creatives across the entire production process and creating additional opportunities for diverse emerging talent and underrepresented stories and voices, through initiatives like our Documentary Talent Fund and the Netflix Screenwriters Fellowship.
Get Back Pictures Limited
Strategic report (continued)
For the period ended 31 December 2022
Page 3
Globally, Netflix also focuses its efforts in this sphere through the Fund for Creative Equity, a five year programme, to invest $100 million dollars to help build new opportunities for underrepresented communities within entertainment. Through the fund, Netflix supports external organisations committed to creating equitable opportunities in the TV and film industries, as well as bespoke Netflix programs that help us to identify, train and provide job placement for up-and-coming talent globally.
The Company reports the environmental impact of its business in the United Kingdom through its streamlined energy and carbon reporting (“SECR”). This report is available in full in the Director's Report.
e. The desirability of the Company's maintaining a reputation for high standards of business conduct:
We are committed to managing our business ethically and with integrity. Our Code of Ethics sets out our expectations for conduct among our employees and Board members. We encourage reporting of breaches of our Code or any unethical or inappropriate conduct to the Production HR lead, Line Producer, UPM or Executive Producer. We also provide a confidential reporting hotline to production employees.
As part of our commitment to managing our business ethically and with integrity, we seek to identify and mitigate risks that could lead to potential legal and/or regulatory violations. Our Global Anti-Corruption Policy requires our employees and contractors to abide by global anti-corruption and anti-bribery laws. A copy of our practices and policies, which includes the Global Anti-Corruption Policy and Code of Ethics, has been translated into numerous languages and remains available to all employees throughout their employment with us.
f. The need to act fairly as between members of the Company:
The Company is a wholly owned subsidiary within the Netflix Group, with Netflix, Inc. being the ultimate parent company. All interactions with other Group companies are governed by established intercompany arrangements.
Charles Light
Director
25 September 2023
Get Back Pictures Limited
Director's report
For the period ended 31 December 2022
Page 4
The director presents his annual report and audited financial statements of the Company for the period ended 31 December 2022.
Principal activities
The principal activity of the Company during the year was the production of broadcast content for distribution throughout the world.
Results and dividends
The results for the period are set out on page 13.
No ordinary dividends were paid (May 2022: £nil). The director does not recommend payment of a final dividend (May 2022: £nil).
Director
The director who held office during the period and up to the date of signature of the financial statements was as follows:
Charles Light
Future developments
No changes are expected to the Company's principal activities.
Auditor
Saffery LLP were appointed as 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.
Get Back Pictures Limited
Director's report (continued)
For the period ended 31 December 2022
Page 5
Streamlined energy and carbon reporting
To entertain the world, we need a habitable planet to entertain. We are working to meet our climate commitments by making our operations more sustainable, including behind the camera in our productions, and to support creators who want to highlight sustainability on screen.
In March of 2021, the Netflix Group set two near-term climate targets:
Science-Based Emissions Reduction Target: Reduce absolute Scope 1 and 2 emissions by 46% by 2030, as validated by the Science Based Targets Initiative (SBTi);
Net Zero Target: Bring our remaining net emissions from 2022 onwards to zero, in support of global net zero goals, by investing in nature-based solutions that retain and capture carbon.
To meet these objectives we are focused on four key levers:
Energy Efficiency: Identifying cost-effective efficiency improvements for energy used in our offices and studios;
Vehicle Electrification: Transitioning from vehicles that use fossil fuels to fully electric and/or hydrogen powered alternatives;
Clean Mobile Power: Using alternatives to diesel generators on productions; and
Renewable Energy: Using renewable electricity and fuels.
We approach these four levers using an OED framework — i.e., optimizing energy use first, then electrifying where possible, and decarbonizing the rest.
Optimize (O): We are conducting energy efficiency audits, including for our stages, studios and offices, so we can optimize vehicle fleet operations, right-size vehicles and mobile power and give preference to more efficient equipment.
Electrify (E): We are working to electrify the equipment that uses the most fuel, like vehicles, buildings and generators. Where available, we use electric motors, which are more efficient and because electricity is more easily decarbonized. We’ve successfully piloted the use of mobile batteries and hydrogen-battery powered generators in lieu of fossil-fuel powered generators in our productions. And we are also replacing fossil-fuel vehicles with electric, plug-in hybrid and hybrid vehicles.
Decarbonize (D): When optimization and electrification aren’t possible, we decarbonize the remaining emissions by installing and purchasing renewable energy. This means matching renewable electricity to any grid-connected power that isn’t carbon-free and shifting to lower-carbon or zero-carbon fuel options when that isn’t possible. Last year, we procured renewable electricity to match our global electricity demand and we’re exploring more direct investments.
Each year we continually develop and further refine our 2030 science-based emissions reduction target transition strategy.
Get Back Pictures Limited
Director's report (continued)
For the period ended 31 December 2022
Page 6
To supplement our decarbonization work, we delivered on our promise to net all remaining emissions to zero, across all three scopes, in 2022. We did this by investing in nature to retain and remove carbon (nature-based carbon credits) and match remaining electricity use to like-for-like renewable energy credits. Our 2022 carbon credit portfolio spans four continents, six countries, and 25+ on-the-ground partners, with 100% third-party certification for carbon measurement. Netflix does extensive due diligence before including a project in our portfolio, using a rigorous five step evaluation process to select the highest quality credits, all of which need to demonstrate their value beyond the carbon, including social impact, community and biodiversity benefits. Nature-based projects make up 64% of our portfolio because of their ecosystem benefits and potential to bring economic value to the region, including indigenous people or those disproportionately affected by climate change.
In the year to 31st December 2022, Get Back Pictures Limited falls under the scope of the UK Streamlined Energy and Carbon Reporting (SECR) framework. Below we have disclosed our energy and emissions data:
CY 2022 - Get Back Pictures Limited
Energy consumption used to calculate emission (kWh)
6,123,925
Emissions from activities for which the company own or control including combustion of fuel & operation of facilities - Scope 1 (tCO2e)
2,335
Emissions from purchase of electricity, heat, steam and cooling purchased from own use - Scope 2 / (tCO2e) - location based
178
Total gross Scope 1 & Scope 2 emissions (tCO2e)
2,513
Intensity ratio
Total gross Scope 1 & Scope 2 emissions (tCO2e) / per production shooting day
35.90
Methodology Applied
Netflix’s GHG emissions reporting is consistent with the operational control approach as set out by the GHG Protocol Corporate Accounting and Reporting Standard: Revised Edition (2004).
The methodology applied to estimate annual carbon footprint totals for both market-based and location-based emissions are the accounting methods as defined by the GHG Protocol Scope 2 Guidance. The location-based figures are calculated based on the emissions intensity of the locations where the electricity consumption occurs. A market-based method incorporates electricity procurement decisions that companies have chosen, such as provider-specific electricity supply and contractual instruments such as renewable energy certificates (RECs).
The organizational and operational boundary applies to Get Back Pictures Limited as well as owned and controlled corporate assets and administrative facilities, and leased facilities which are operationally controlled by Netflix through its leasing agreements.
The operational control approach best reflects Netflix’s ability to direct operational policies and therefore generate emission reductions (as well as obtain access to accurate and reliable data).
Get Back Pictures Limited
Director's report (continued)
For the period ended 31 December 2022
Page 7
Emission Reduction Activities
Netflix operates a global sustainability programme. For the purpose of this section of the report we have summarised key initiatives related to Get Back Pictures Limited:
Netflix is a member of the albert Directorate and Consortium, which supports the global Film and TV industry to reduce the environmental impacts of production and to create content that supports a vision for a sustainable future. Netflix participates in the albert certification scheme for both our self-managed and partner-managed shows.
Netflix actively partners with the entertainment industry to empower the industry to create content that supports a vision for a sustainable future through BAFTA and albert.
Netflix has committed globally to a Science-Based Target of 46% reduction below 2019 levels across scopes 1 and 2 by 2030 and is implementing the purchase of renewable energy and fuels across its key markets, including the U.K.
We are piloting clean mobile power options on our productions such as hydrogen power units and batteries, using clean mobile power in 60% of productions Netflix manages in 2022
Netflix studios in Shepperton procure zero carbon energy
We maintain BREEAM compliance at our facilities
Further information on our sustainability progress can be found in our 2022 Environmental, Social and Governance (ESG) Report on our investor relations website at https://ir.netflix.net/governance/ESG.
Statement of director's responsibilities
The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is 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. He is 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.
Get Back Pictures Limited
Director's report (continued)
For the period ended 31 December 2022
Page 8
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.
Going Concern
In preparing the financial statements of Get Back Pictures Limited the director has made an assessment of the next twelve months' performance from signing and consider preparation on going concern basis to be appropriate.
On behalf of the board
Charles Light
Director
25 September 2023
Get Back Pictures Limited
Independent auditor's report
To the member of Get Back Pictures Limited
Page 9
Opinion
We have audited the financial statements of Get Back Pictures Limited (the 'Company') for the period ended 31 December 2022 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity 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 101 Reduced Disclosure Framework (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 2022 and of its profit for the period then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice including FRS101; 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 director's 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 director with respect to going concern are described in the relevant sections of this report.
Get Back Pictures Limited
Independent auditor's report (continued)
To the member of Get Back Pictures Limited
Page 10
The director is 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.
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 the audit:
the information given in the strategic report and the director's report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
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 director's 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 director
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Get Back Pictures Limited
Independent auditor's report (continued)
To the member of Get Back Pictures Limited
Page 11
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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.
Identifying and assessing risks related to irregularities:
We assessed the susceptibility of the Company’s financial statements to material misstatement and how fraud might occur, including through discussions with the director, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the Company by discussions with director and by updating our understanding of the sector in which the Company operates.
Laws and regulations of direct significance in the context of the Company include The Companies Act 2006 and UK Tax legislation, specifically legislation relating to creative industry tax credits.
Audit response to risks identified:
We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the Company's records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the Company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance. We have reviewed management's assessment of how the Company, and production, comply with the relevant laws and regulations governing access to the creative industry tax credits.
During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.
Get Back Pictures Limited
Independent auditor's report (continued)
To the member of Get Back Pictures Limited
Page 12
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.
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.
Nigel Walde (Senior Statutory Auditor)
For and on behalf of Saffery LLP
27 September 2023
Chartered Accountants
Statutory Auditors
71 Queen Victoria Street
London
EC4V 4BE
Get Back Pictures Limited
Statement of comprehensive income
For the period ended 31 December 2022
Page 13
Period
Year
ended
ended
31 December
31 May
2022
2022
Notes
£
£
Revenue
2.1
40,112,367
73,238,457
Cost of sales
(46,967,451)
(87,912,540)
Gross loss
(6,855,084)
(14,674,083)
Administrative expenses
158,198
(81,420)
Loss before taxation
2.2
(6,696,886)
(14,755,503)
Tax on loss
2.4
6,709,116
14,774,560
Profit and total comprehensive income for the financial period
12,230
19,057
There were no recognised gains and losses for the period other than those passing through the statement of comprehensive income.
The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
The notes on pages 16 to 24 form an integral part of these financial statements
Get Back Pictures Limited
Statement of financial position
As at 31 December 2022
31 December 2022
Page 14
31 December 2022
31 May 2022
Notes
£
£
£
£
Current assets
Trade and other receivables
3.2
15,588,143
18,861,074
Current tax recoverable
21,483,676
14,774,560
Cash and cash equivalents
64,507
609,300
37,136,326
34,244,934
Current liabilities
Trade and other payables
3.3
37,105,038
34,225,876
Total assets less current liabilities
31,288
19,058
Net assets
31,288
19,058
Equity
Called up share capital
4.1
1
1
Retained earnings
31,287
19,057
Total equity
31,288
19,058
The financial statements were approved and signed by the director and authorised for issue on 25 September 2023.
Charles Light
Director
Company registration number 12071484
The notes on pages 16 to 24 form an integral part of these financial statements
Get Back Pictures Limited
Statement of changes in equity
For the period ended 31 December 2022
Page 15
Share capital
Retained earnings
Total
Notes
£
£
£
Balance at 1 June 2021
1
1
Year ended 31 May 2022:
Profit and total comprehensive income for the year
-
19,057
19,057
Balance at 31 May 2022
1
19,057
19,058
Period ended 31 December 2022:
Profit and total comprehensive income for the period
-
12,230
12,230
Balance at 31 December 2022
4.1
1
31,287
31,288
The notes on pages 16 to 24 form an integral part of these financial statements
Get Back Pictures Limited
Notes to the financial statements
For the period ended 31 December 2022
Page 16
1
About this report
1.1
Activities
Get Back Pictures Limited (hereafter 'the Company') is a private limited liability company limited by shares. The Company is part of the Netflix group, one of the world’s leading entertainment services. The main activity of the Company is that of the production of broadcast content for distribution throughout the world.
Netflix Worldwide Productions, LLC, is the direct parent of the Company and the ultimate parent of the Company is Netflix, Inc., both incorporated in the United States of America. The registered office of Netflix, Inc., is located at 121 Albright Way, Los Gatos, California 95032, United States of America and the consolidated financial statements are available at this address.
Get Back Pictures Limited is a private company limited by shares incorporated in England and Wales. The registered office is 100 New Bridge Street, London, EC4V 6JA.
The current period financial statements have been presented for a period of less than one year from 1 June 2022 to 31 December 2022. The prior period financial statements were presented for the year to 31 May 2022 and as such the comparatives are not directly comparable.
1.2
Basis of preparation
The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.
In preparing the financial statements, the Company applies the recognition, measurement and disclosure requirement of International Financial Reporting Standards as adopted by the EU (“adopted IFRSs”), but makes amendments where necessary in order to comply with the Companies Act 2006 and has set out below where advantage of the FRS 101 disclosure exemptions has been taken.
The Company is a qualifying entity for the purposes of FRS 101. Note 1.1 gives details of the Company's parent and from where its consolidated financial statements prepared in accordance with US GAAP may be obtained.
The Company has taken advantage of the following disclosure exemptions under FRS 101:
the requirements of IAS 7 Statement of Cash Flows;
the requirements of paragraph 17 and 18A of IAS 24 Related Party Disclosures;
the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member;
disclosure of information in relation to new standards not yet applied; and
disclosures in respect of capital management.
Details of the Company's accounting policies are included within the relevant note where applicable, or disclosed in Note 4.3.
1.3
Basis of measurement
These financial statements have been prepared on a historical cost basis, unless otherwise stated.
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
1
About this report (continued)
Page 17
1.4
Functional and presentation currency
These financial statements are presented in British Pound Sterling (GBP), which is the Company's functional currency.
1.5
Current or non-current classification
Current assets include assets that are consumed or realised as part of the normal operating cycle, being 12 months, other assets are classified as non-current. Current liabilities include all liabilities unless the Company has a contractual or unconditional right to defer settlement of the liability for at least 12 months after the reporting period.
1.6
Critical accounting estimates and judgements
In preparing these financial statements, management has made judgements and estimates that affect the application of the Company’s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised prospectively.
Details of the judgements and estimates made are included in the following notes:
2
Business Performance
2.1
Revenue
Revenue arises principally from the sale of programme rights. The classification and geographical analysis of revenue is as follows:
31 December
31 May
2022
2022
£
£
Revenue analysed by class of business
Sale of programme rights
40,100,137
73,219,400
Production services fee
12,230
19,057
40,112,367
73,238,457
31 December
31 May
2022
2022
£
£
Revenue analysed by geographical market
United States of America
40,112,367
73,238,457
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
2
Business Performance (continued)
Page 18
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable, and represents amounts receivable for the sale of programme rights, stated net of discounts, returns and value added taxes. The Company recognised revenue over time as the relevant performance obligation is satisfied. There is one performance obligation with the customer, being the production of broadcast content.
The transaction price is allocated in full to the single distinct performance obligation and is set out in the contract between the Company and the customer. Payment is received before or as work is completed and therefore no discounting is required.
As the Company’s activity creates and enhances the programme that the customer controls, revenue is recognised over time as the Company satisfies performance obligations by transferring the promised rights to its customer in accordance with paragraph 35(b) of IFRS 15. The amount of revenue to recognise is determined based on the input method that calculates actual costs incurred relative to the estimated total costs for the project based upon a “percentage of completion” calculation.
Estimates of revenues, costs or the extent of progress towards completion are revised if circumstances change. Any resulting increases or decreases in estimated revenues of costs are reflected in the statement of comprehensive income in the period in which the circumstances that give rise to the revision become known.
The Company has only one operating segment, the whole of revenue is attributable to this segment. All revenues are from related parties.
Estimation uncertainty of revenue
There are a number of judgements in respect of the recognition of revenue on contracts with customers, including:
The determination of the number of distinct separate performance obligations in a contract. This is based upon judgement around whether the customer can benefit from the use of the service on its own or together with other resources that are readily available to it, and also whether the promise to transfer the rights is separately identifiable from other promises in the contract. As explained in the accounting policy for revenue, there is generally one distinct performance obligation, being the production of broadcast content;
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
2
Business Performance (continued)
Page 19
Whether the Company transfers control of the programme over time, and therefore satisfies the performance obligation and recognises revenue over time. This requires judgement as to whether the customer controls the programme as it is created and enhanced. As the customer approves the production of the programme as it progresses, and is involved in directing the production activity, it is generally considered that control is transferred over time and revenue is recognised accordingly;
Recognition over time is determined based upon judgement and estimates on the overall contract margin and percentage of completion of the contract at each period end. These judgements are based on contract value, historical experience and forecasts of future outcomes. These include specific judgement in respect of contracts for which variations may be in the process of being negotiated, and so the contracts are accounted for on the basis of the best estimate of the revenue expected to be received on the contract.
2.2
Operating loss
31 December
31 May
2022
2022
£
£
Operating loss for the period is stated after charging:
Exchange (gains)/losses
(182,698)
56,920
Fees payable to the Company's auditor for the audit of the Company's financial statements
17,000
17,000
Fees payable to the Company's auditor for non-audit services
7,500
7,500
2.3
Employees
31 December
31 May
2022
2022
£
£
Wages and salaries
3,352,933
5,431,398
Social security costs
440,515
663,075
Pension costs
41,249
46,175
3,834,697
6,140,648
No directors remuneration was paid or is payable during the year for services provided to the Company. The director is remunerated by the ultimate parent as an employee, with no recharge to the Company.
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.
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
2
Business Performance (continued)
Page 20
During the period, the average monthly number of employees calculated on a full-time equivalent basis was 117 (31 May 2022: 127).
2.4
Income tax expense
31 December
31 May
2022
2022
£
£
Current tax expense
UK corporation tax on losses for the current period
(6,709,116)
(14,774,560)
Total UK current tax
(6,709,116)
(14,774,560)
The credit for the year can be reconciled to the loss per the income statement as follows:
31 December
31 May
2022
2022
£
£
Loss before tax
(6,696,886)
(14,755,503)
Change in income tax due to:
Expected tax credit based on a corporation tax rate of 19%
(1,272,408)
(2,803,546)
Television tax credit at 25%
(6,709,116)
(3,545,894)
Adjustment to trading result in line with television production company tax rules
(77,100)
(11,247,269)
Deferred tax not recognised
1,349,508
2,822,149
Income tax expense
(6,709,116)
(14,774,560)
Tax charged in the financial statements
(6,709,116)
(14,774,560)
A key accounting estimate within the financial statements for this Company is the valuation of the high-end television tax credit available. The estimate is based on the assessment of the value of qualifying expenditure as per HMRC legislation and guidance plus assessment of the qualification of the underlying programme as eligible for the tax relief.
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
2
Business Performance (continued)
Page 21
Current tax
Current tax is based on relievable losses arising as a result of high-end television tax relief legislation. Relievable losses differ from net losses as reported in the profit and loss account because they include an additional deduction relating to qualifying production expenditure and exclude items of income or expense that are deductible in other years, as well as items that are never taxable or deductible. The Company's tax position is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.
Current and deferred tax assets and tax liabilities are offset only if certain criteria are met.
3
Operating assets and liabilities
3.1
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, bank overdrafts, and amounts in transit from payment processors for credit card and debit card transactions.
All cash and cash equivalents are at the Company’s free disposal.
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
3
Operating assets and liabilities (continued)
Page 22
3.2
Trade and other receivables
31 December 2022
31 May 2022
£
£
Other receivables
13,639,370
14,227,335
VAT recoverable
226,117
4,565,616
Amount owed by parent undertaking
1
1
Prepayments
1,722,655
68,122
15,588,143
18,861,074
Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less a provision for impairment when applicable.
The receivables are short-term in nature.
The receivables due from group companies bear no interest, are short-term in nature and are periodically settled.
3.3
Trade and other payables
31 December 2022
31 May 2022
£
£
Trade payables
482,440
7,657,412
Amounts owed to fellow group undertakings
36,370,268
22,088,264
Accruals
252,330
2,858,498
Other payables
-
1,621,702
37,105,038
34,225,876
These amounts represent liabilities for goods and services provided to the Company prior to the end of the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost.
The payables due to group companies bear no interest, are short-term in nature and are periodically settled.
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
Page 23
4
Other
4.1
Equity
The authorised share capital of the Company of £1 is divided into 1 Ordinary shares, fully paid-up, with a par value of £1 each.
Ordinary shares issued by the Company are classified as equity and 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.
4.2
Commitments and contingencies
At the reporting end date the Company had outstanding commitments for future minimum payments under a non-cancellable license to occupy agreement, which fall due as follows:
31 December 2022
31 May 2022
£
£
Within one year
-
95,539
The Company is due to make total payments of £16,842,018 to various contracted individuals involved in the production once the programme has been delivered.
4.3
Significant accounting policies and new accounting standards
Financial assets
Financial assets are recognised in the Company's statement of financial position when the Company becomes party to the contractual provisions of the instrument.
Financial assets are classified into specified categories. The classification depends on the nature and purpose of the financial assets and is determined at the time of recognition.
Financial assets are initially measured at fair value plus transaction costs, other than those classified as fair value through profit and loss, which are measured at fair value.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
Get Back Pictures Limited
Notes to the financial statements (continued)
For the period ended 31 December 2022
4
Other (continued)
Page 24
Financial liabilities
Basic financial liabilities, including trade and other payables, 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 a 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 or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if payment is due within one period 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 interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into British Pound Sterling at the rates of exchange ruling at the date of the Statement of Financial Position. Trading results are translated at the average rate over the period in which the transactions were incurred. Foreign exchange differences are dealt with through the statement of comprehensive income.
The exchange rates ruling at the date of the Statement of Financial Position £1 = $1.202 and £1 = €1.133 (May 2022: £1 = $1.260 and £1 = €1.176)
Production costs incurred are recognised in the statement of comprehensive income as cost of sales in the period in which they are incurred.
Revenues, expenses and assets are recognised net of the associated VAT, unless the tax incurred is not recoverable from the relevant tax authority. In this case, it is recognised as part of the cost of acquisition of the asset or part of the expense. Receivables and payables are stated inclusive of the amount of VAT receivable or payable. The net amount of VAT recoverable from, or payable to, the tax authority is included within other receivables or payables in the balance sheet.
4.4
Events after the reporting date
No other events after the reporting period have occurred that are deemed material to the users of these financial statements.
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