Registered number: 08479948
NKK FINANCE LTD
UNAUDITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 DECEMBER 2022
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NKK FINANCE LTD
CHARTERED ACCOUNTANTS' REPORT TO THE BOARD OF DIRECTORS ON THE PREPARATION OF THE UNAUDITED STATUTORY FINANCIAL STATEMENTS OF NKK FINANCE LTD
FOR THE YEAR ENDED 31 DECEMBER 2022
In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of NKK Finance Ltd for the year ended 31 December 2022 which comprise the Balance Sheet, the Statement of Changes in Equity and the related notes from the Company's accounting records and from information and explanations you have given us.
As a practising member firm of the Institute of Chartered Accountants in England and Wales (ICAEW), we are subject to its ethical and other professional requirements which are detailed at https://www.icaew.com /regulation.
This report is made solely to the Board of Directors of NKK Finance Ltd, as a body, in accordance with the terms of our engagement letter. Our work has been undertaken solely to prepare for your approval the financial statements of NKK Finance Ltd and state those matters that we have agreed to state to the Board of Directors of NKK Finance Ltd, as a body, in this report in accordance with ICAEW Technical Release TECH07/16AAF. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than NKK Finance Ltd and its Board of Directors, as a body, for our work or for this report.
It is your duty to ensure that NKK Finance Ltd has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and loss of NKK Finance Ltd. You consider that NKK Finance Ltd is exempt from the statutory audit requirement for the year.
We have not been instructed to carry out an audit or review of the financial statements of NKK Finance Ltd. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements.
Wisteria Limited
The Grange Barn
Pike's End
Pinner
Middlesex
HA5 2EX
27 September 2023
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NKK FINANCE LTD
REGISTERED NUMBER: 08479948
BALANCE SHEET
AS AT 31 DECEMBER 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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NKK FINANCE LTD
REGISTERED NUMBER: 08479948
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
The directors consider that the Company is entitled to exemption from audit under section 477 of the Companies Act 2006 and members have not required the Company to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
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.
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The Company has opted not to file the profit and loss account in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
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Gerry Jennings
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The notes on pages 5 to 12 form part of these financial statements.
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NKK FINANCE LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
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Comprehensive income for the year
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Currency translation differences
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Convertible preference shares - equity
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Shares issued during the year
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Comprehensive income for the year
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Currency translation differences
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Shares issued during the year
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The notes on pages 5 to 12 form part of these financial statements.
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
NKK Finance Limited is a private company limited by share capital, incorporated in England & Wales, registration number 08479948. The address of the registered office is Unit 16 Clacton Enterprise Centre, 1-2 Davy Road, Gorse Lane Industrial Estate, Clacton-On-Sea, Essex, United Kingdom, CO15 4XD.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The following principal accounting policies have been applied:
The financial statements are prepared on a going concern basis.
The directors acknowledge the significant level of liabilities on the balance sheet and have sought external advice in managing these appropriately. The directors have prepared budgets and cashflows for a period of at least twelve months from the date of approval of the financial statements which demonstrates that there is no material uncertainty regarding the Company's ability to meet its liabilities as they fall due and to continue as a going concern. Accordingly the directors consider it appropriate to prepare the financial statements on a going concern basis.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is Euros.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Interest income is recognised in profit or loss using the effective interest method.
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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Current and deferred taxation
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The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Balance Sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Balance Sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Profit and Loss Account.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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.
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Convertible preference shares
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NKK Finance Limited had issued 21,238 of 8% convertible preference shares. Upon redemption, the convertible preference shares give the holder the right to convert the preference shares to ordinary shares at no additional cost. Dividends are payable upon redemption and rank in priority to any dividends declared on ordinary shares.
NKK Finance Limited has issued convertible loan notes. Interest accrues as 12% annually (non-compounding), however interest is only paid out at the board's discretion. The Company can redeem the loan notes after completion of an investment round by paying the principal, together with all accrued interest.
NKK Finance Limited has received an amount of €Nil (2021: €Nil) in relation to share subscriptions not yet issued.
Dividends on shares recognised as liabilities are recognised as expenses and classified within interest payable.
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The average monthly number of employees, including directors, during the year was 2 (2021 - 2).
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Investments in subsidiary companies
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Amounts owed by group undertakings
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Prepayments and accrued income
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Amounts owed by group undertakings are interest-free and repayable on demand.
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Accruals and deferred income
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Creditors: Amounts falling due after more than one year
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Convertible preference shares
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Convertible preference shares are explained in detail in note 13.
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NKK FINANCE LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Convertible Preference Shares
NKK Finance Limited had issued 12,136 of 8% convertible preference shares redeemable upon the maturity date of 9 April 2023 for £14.33 per share. The Company has also issued 9,102 of 8% convertible preference shares redeemable upon the maturity date of 5 March 2024 at £14.33. Upon redemption, the convertible preference shares give the holder the right to convert the preference shares to ordinary shares at no additional cost. Dividends are payable upon redemption and rank in priority to any dividends declared on ordinary shares.
Convertible Loan Notes
NKK Finance Limited has issued convertible loan notes. Interest accrues as 12% annually (non-compounding), however interest is only paid out at the board's discretion. The Company can redeem the loan notes after completion of an investment round by paying the principal, together with all accrued interest.
Share subscriptions
NKK Finance Limited does not hold any amounts in relation to share subscriptions not yet issued as at 31 December 2022 (€nil was held in this category as at 31 December 2021).
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Related party transactions
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Included in other creditors less than 1 year, the director Jeremy Davies was owed €105,000 (2021: €105,000). Gerry Jennings was owed €Nil (2021: €Nil). David McNamara was owed €64,420 (2021: €Nil).
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Post balance sheet events
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There have been no significant events affecting the company since the year end.
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NKK FINANCE LTD
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