Company Registration No. 12340393 (England and Wales)
Merman-Frank Limited
Report and unaudited financial statements
for the period ended 31 December 2021
Merman-Frank Limited
Company information
Directors
Sharon Horgan
Rebecca Parkinson
Jacqueline Sidey
Clelia Christina Mountford
Company number
12340393
Registered office
202 Blackfriars Road
London
SE1 8NJ
Accountants
Saffery Champness LLP
71 Queen Victoria Street
London
EC4V 4BE
Merman-Frank Limited
Contents
Page
Directors' report
1
Profit and loss account
2
Balance sheet
3
Notes to the financial statements
4 - 10
Merman-Frank Limited
Directors' report
For the period ended 31 December 2021
Page 1
The directors present their report and financial statements for the period ended 31 December 2021.
Principal activities
The principal activity of the company continued to be that of television programme production.
Directors
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
Sharon Horgan
Jeremy Rainbird
(Resigned 17 January 2023)
Rebecca Parkinson
Jacqueline Sidey
Clelia Christina Mountford
Going concern
The directors have decided that the company will cease trading within 12 months of filing these financial statements as the production is now complete and there will be no further trading activity for this company. As a result of this, the directors have decided not to adopt the going concern principle within these financial statements. The directors do not believe that there is any impact of not adopting the going concern principle on the financial statements.
Small companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
On behalf of the board
Jacqueline Sidey
Director
16 March 2023
Merman-Frank Limited
Profit and loss account
For the period ended 31 December 2021
Page 2
Period
Period
ended
ended
31 December
30 June
2021
2020
Notes
£
£
Turnover
3
582,255
2,203,177
Cost of sales
(1,206,718)
(2,783,760)
Gross loss
(624,463)
(580,583)
Administrative expenses
(15,000)
(12,500)
Other operating income
400,862
122,744
Operating loss
(238,601)
(470,339)
Interest payable and similar expenses
(8,241)
Loss before taxation
(246,842)
(470,339)
Tax on loss
5
246,842
470,339
Profit for the financial period
Merman-Frank Limited
Balance sheet
As at 31 December 2021
31 December 2021
Page 3
31 December
30 June
2021
2020
Notes
£
£
£
£
Current assets
Debtors
6
1,173,350
641,175
Cash at bank and in hand
19,339
17,762
1,192,689
658,937
Creditors: amounts falling due within one year
7
(1,192,688)
(658,936)
Net current assets
1
1
Capital and reserves
Called up share capital
1
1
For the financial period ended 31 December 2021 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
T
he member has not required the company to obtain an audit of its financial statements for the period in question in accordance with section 476
.
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 16 March 2023 and are signed on its behalf by:
Jacqueline Sidey
Director
Company Registration No. 12340393
Merman-Frank Limited
Notes to the financial statements
For the period ended 31 December 2021
Page 4
1
Accounting policies
Company information
Merman-Frank Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
202 Blackfriars Road, London, SE1 8NJ.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The directors have decided that the company will cease trading within 12 months of filing these financial statements as the production is now complete and there will be no further trading activity for this company. As a result of this, the directors have decided not to adopt the going concern principle within these financial statements. The directors do not believe that there is any impact of not adopting the going concern principle on the financial statements.
1.3
Reporting period
The company's natural accounting reference date was extended from 30 June 2021 to 31 December 2021 so the financial statements are presented for a period of 18 months which is longer than a year. It was extended to align with the stage of production of the television programme that has been produced by the company.
1.4
Turnover
In respect of long-term contracts for ongoing services, turnover represents the value of work done in the period, including estimates for amounts not invoiced. Value of work done in respect of long-term contracts and contracts for ongoing services is determined by reference to the stage of completion.
The "percentage of completion method" is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the period in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.
Merman-Frank Limited
Notes to the financial statements (continued)
For the period ended 31 December 2021
1
Accounting policies (continued)
Page 5
1.5
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.
1.6
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, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including
creditors
, bank loans
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
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities.
Trade creditors
are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
Merman-Frank Limited
Notes to the financial statements (continued)
For the period ended 31 December 2021
1
Accounting policies (continued)
Page 6
1.7
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.
1.8
Taxation
The tax
credit
represents the sum of the tax currently
recoverable.
Current tax
The tax currently receivable is based on relievable losses arising as the 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.
1.9
Government grants
Government grants are recognised at the fair value of the asset receive
d
or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met
. Where a
grant does not specify performance conditions
it
is recognised in income when the proceeds are received or receivable
. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.10
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.
Merman-Frank Limited
Notes to the financial statements (continued)
For the period ended 31 December 2021
Page 7
2
Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Tax credit estimate
The key accounting estimate within the financial statements for this company is the valuation of the high-end TV tax credit available. The estimate is based on the assessment of the value of qualifying expenditure as per HMRC legislations and guidance plus assessment of the qualification of the underlying production as eligible for the tax relief.
A high-end TV tax credit of £246,842 has been recognised during the period (period ended 30 June 2020: £470,339).
In the directors opinion, there were no other critical judgements or other estimation uncertainties in these financial statements.
3
Turnover and other revenue
2021
2020
£
£
Turnover analysed by class of business
Sale of programme rights
582,255
2,203,177
2021
2020
£
£
Turnover analysed by geographical market
United Kingdom
582,255
2,203,177
Merman-Frank Limited
Notes to the financial statements (continued)
For the period ended 31 December 2021
3
Turnover and other revenue (continued)
Page 8
2021
2020
£
£
Other revenue
Grants received
131,511
122,744
Grants received in the period relates to grants received from the Government under the Job Retention Scheme. It has been recognised under the accruals model in relation to furlough costs for payroll staff in the period to 31 December 2021.
4
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2021
2020
Number
Number
Total
19
30
5
Taxation
2021
2020
£
£
Current tax
UK corporation tax on profits for the current period
(246,842)
(470,339)
Merman-Frank Limited
Notes to the financial statements (continued)
For the period ended 31 December 2021
5
Taxation (continued)
Page 9
The actual credit for the period can be reconciled to the expected credit for the period based on the profit or loss and the standard rate of tax as follows:
2021
2020
£
£
Loss before taxation
(246,842)
(470,339)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2020: 19.00%)
(46,900)
(89,364)
Enhanced losses arising from the HETV tax credit
(199,942)
(372,451)
Difference between the rate of corporation tax and the rate of relief under the HETV tax credit
(112,881)
Losses carried forward
104,357
Taxation credit for the period
(246,842)
(470,339)
6
Debtors
2021
2020
Amounts falling due within one year:
£
£
Corporation tax recoverable
717,316
470,339
Amounts owed by group undertakings
176,791
162,815
Other debtors
279,243
8,021
1,173,350
641,175
7
Creditors: amounts falling due within one year
2021
2020
£
£
Bank loans
617,193
Trade creditors
14,303
159,134
Amounts owed to group undertakings
247,414
169,227
Taxation and social security
175,905
89,532
Other creditors
137,873
241,043
1,192,688
658,936
Merman-Frank Limited
Notes to the financial statements (continued)
For the period ended 31 December 2021
Page 10
8
Charges
Coutts & Company hold a fixed charge, floating charge and negative pledge over all right, title and interest in the series owned by the company in respect of the obligation the company has for producing the series. They also have assignment of the benefit of all of the revenues relating to the series.
9
Related party transactions
The company has taken advantage of the exemption under paragraph 33.1a of FRS 102 from disclosing transactions entered into between two or more members of a group, where any subsidiary undertaking which is a party to the transaction is wholly owned by a member of that group.
10
Parent company
As of the reporting date, the company is a wholly owned subsidiary of Merman Television Limited, a company registered in England and Wales.