Annual Financial Report
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, WITHIN, INTO OR IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN.
GRAND FORTUNE HIGH GRADE LIMITED (LSE: GFHG)
("Company")
Reports and financial statements for the period ended 30 April 2017
31 August 2017
The Company is pleased to announce its reports and financial statements for the period ended 30 April 2017.
GRAND FORTUNE HIGH GRADE LIMITED
REPORTS AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 APRIL 2017
GRAND FORTUNE HIGH GRADE LIMITED
CHAIRMAN'S STATEMENT
FOR THE PERIOD ENDED 30 APRIL 2017
I am pleased to present the accounts for the period from 1 October 2016 to 30 April 2017. During the period, the Company reported a loss of £172,584 (loss of £136,134 for the period from incorporation of 10 November 2015 to 30 September 2016) which arose from professional fees in connection with the listing and general administration expenses. As at the date of signing this report the Company has approximately £3.8m of cash balances.
Following its listing on the London Stock Exchange on 22 May 2017, the Company has been focused on the development, by organic growth, of its financial training business in order to satisfy the significant demand for financial sector specialists in China. The Company is in its early stages of development but working towards running its first financial training courses by December 2017.
As the business activities develop, the Company will keep shareholders advised of its activities. We appreciate the assistance of our officers, directors and advisors as we work towards the development of our business.
KIT LING LAW
CHAIRMAN
30 AUGUST 2017
GRAND FORTUNE HIGH GRADE LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 APRIL 2017
Directors' report
The directors present their report together with the audited financial statements for the period ended 30 April 2017.
Principal activity and future developments
The company is focused on the development, by organic growth, of its financial training business in order to satisfy the significant demand for financial sector specialists in China.
Business review and management report
The loss on ordinary activities for the period from 1 October 2016 to 30 April 2017 was of £172,584 (loss of £136,134 for the period from incorporation of 10 November 2015 to 30 September 2016).
The company had cash at bank and in hand of £31,947 at 30 April 2017. The principal risks and uncertainties that the company faces are in developing its financial training business in China, which is a new market. The company is aiming to tailor and deliver courses that are appropriate for the market but there is no guarantee there will be a sufficient demand for the courses offered.
The company has not carried out any activities in the field of research and development.
Events that have occurred since the end of the financial period are detailed in note 15 to the accounts.
Dividends
The directors do not recommend the payment of a final dividend for the period.
Directors
The following directors served during the period to 30 April 2017:
KIT LING LAW - CHAIRMAN
HONG LIN CAO - CHIEF EXECUTIVE OFFICER
YAN WING LAURENCE CHEUNG - CHIEF FINANICAL OFFICER
YAN XU - BUSINESS DEVELOPMENT DIRECTOR
YONG YAN - TRAINING DIRECTOR
SANDY JADEJA - NON-EXECUTIVE DIRECTOR
ANGUS SIGURD IRVINE - NON-EXECUTIVE DIRECTOR
GRAND FORTUNE HIGH GRADE LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 APRIL 2017
(CONTINUED)
Substantial shareholdings
Except for the interests of those persons set out below, the Directors are not aware of any interest (other than the interests of the Directors) which, at the date of this document (including those who participated in the placing of 43,000,000 shares at £0.10 per share for gross proceeds of £4,300,000, as disclosed in note 15), would amount to 3% or more of the Company's issued share capital:
|
Name |
Number of Ordinary Shares |
Approximate % Holding |
|
|
|
|
|
Kit Ling Law |
46,800,000 |
29.25% |
|
Yan Wing Laurence Cheung |
38,996,100 |
24.37% |
Directors' interests
The directors' interests in the share capital of the company are shown below. All interests are beneficial.
|
Name |
Number of Ordinary Shares |
|
|
|
|
Kit Ling Law |
46,800,000 |
|
Hong Lin Cao |
- |
|
Yan Wing Laurence Cheung |
38,996,100 |
|
Yan Xu |
- |
|
Yong Yan |
- |
|
Sandy Jadeja |
- |
|
Angus Sigurd Irvine |
- |
Directors' emoluments are detailed in Notes 8, 9 and 16 to the accounts.
Auditors
A resolution proposing that Crowe Clark Whitehill LLP be re-appointed as auditors of the company will be put to the annual general meeting.
Share capital and voting rights
There are no movement of share capital during the period ended 30 April 2017.
GRAND FORTUNE HIGH GRADE LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 APRIL 2017
(CONTINUED)
Going concern
The company is focused on the development, by organic growth, of a financial training business in China, and, apart from a small amount of interest receivable, currently has no income stream. Until the training business has been adequately developed and is generating revenue, it is therefore dependent on its cash reserves to fund ongoing costs. At 30 April 2017, the Company's cash position was £31,947 (with additional gross proceeds of £4,300,000 from the completion of the Placing subsequent to 30 April 2017 - see note 15 to the accounts).
After reviewing the company's budget for the period ending 30 October 2018 and its medium term plans (including the completion of the Placing in May 2017 - see note 15 to the accounts), the directors have a reasonable expectation that the company will have adequate resources to continue in operational existence for the foreseeable future.
For this reason, they continue to adopt the going concern basis in preparing the accounts.
Financial risk management
The company's financial risk management objective is to minimise, as far as possible, the company's exposure to such risk as detailed in note 13 to the accounts.
Corporate governance
As a company with a Standard Listing, the Company is not required to comply with the provisions of the Corporate Governance Code. Although, the Company does not comply with the UK Corporate Governance Code, the Company intends to adopt corporate governance procedures as are appropriate for the size and nature of the Company and the size and composition of the Board. These corporate governance procedures have been selected with due regard to for the provisions of the Corporate Governance Code insofar as is appropriate. A description of these procedures is set out below:
· as the Company is a start-up it will not have separate risk, compliance or nomination committees. The Board as a whole will instead review risk, compliance and nominations matters, as well as the Board's size, structure and composition, taking into account the interests of the Shareholders and the performance of the Company. Once the Company has achieved sufficient growth, the Board intends to put in place risk, compliance and nomination committees.
GRAND FORTUNE HIGH GRADE LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 APRIL 2017
(CONTINUED)
· One-third of Directors (or, where their number is not divisible by three, the nearest number not exceeding one-third) will be required to retire and seek re-elections on an annual basis.
Directors' responsibility statement
The directors are responsible for preparing the annual report and the non-statutory financial statements. The directors are required to prepare financial statements for the Company in accordance with International Financial Reporting Standards as adopted by the EU (together, "IFRS").
International Accounting Standard 1 requires that financial statements present fairly for each financial year the Company's financial position, financial performance and cash flows. This requires the faithful representation of transactions, other events and conditions in accordance with the definitions and recognition criteria for the assets, liabilities, income and expenses set out in the International Accounting Standards Board's "Framework for the Preparation and Presentation of Financial Statements". In virtually all circumstances, a fair representation will be achieved by compliance with all IFRS. Directors are also required to:
- select suitable accounting policies and then apply them consistently;
- present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information; and
- provide additional disclosures when compliance with the specific requirements in IFRS is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Company's financial position and financial performance.
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time, the financial position of the Company. 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.
The maintenance and integrity of the Grand Fortune High Grade Limited website is the responsibility of the Directors; work carried out by the auditors does not involve the consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred in the accounts since they were initially presented on the website.
Legislation in the Cayman Islands governing the preparation and dissemination of the accounts and the other information included in annual reports may differ from legislation in other jurisdictions.
The Directors are responsible for preparing the Financial Statements in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority ('DTR') and with International Financial Reporting Standards (IFRS) as adopted by the European Union.
GRAND FORTUNE HIGH GRADE LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 APRIL 2017
(CONTINUED)
The directors confirm, to the best of their knowledge that:
· the financial statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company;
· the financial statements include a fair review of the development and performance of the business and the financial position of the Company, together with a description of the principal risks and uncertainties that it faces; and
· the annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the company's performance, business model and strategy.
By order of the board
KIT LING LAW
CHAIRMAN
30 AUGUST 2017
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GRAND FORTUNE HIGH GRADE LIMITED
Opinion
We have audited the non-statutory financial statements of Grand Fortune High Grade Limited (the "Company") for the period ended 30 April 2017, which comprise:
· the Company statement of comprehensive income for the period ended 30 April 2017;
· the Company statements of financial position as at 30 April 2017;
· the Company statements of cash flows and statements of changes in equity for the period then ended; and
· the notes to the financial statements, which include a summary of significant accounting policies and other explanatory information.
The financial reporting framework that has been applied in the preparation of the Company non-statutory financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.
In our opinion:
· the non-statutory financial statements give a true and fair view of the state of the Company's affairs as at 30 April 2017 and of the Company's profit for the period then ended; and
· the non-statutory financial statements have been properly prepared in accordance with International Financial Reporting Standards as adopted by the European Union.
This report is made solely to the company's members. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them 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 members as a body, for our audit work, for this report, or for the opinions we have formed.
Basis for opinion
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
We have nothing to report in respect of the following matters in relation to which ISAs (UK) require us to report to you when:
· The directors' use of the going concern basis of accounting in the preparation of the non-statutory financial statements is not appropriate; or
· The directors have not disclosed in the non-statutory financial statements any identified material uncertainties that may cast significant doubt about the Company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the non-statutory financial statements are authorised for issue.
Overview of our audit approach
Materiality
· In planning and performing our audit we applied the concept of materiality. An item is considered material if it could reasonably be expected to change the economic decisions of a user of the financial statements. We used the concept of materiality to both focus our testing and to evaluate the impact of misstatements identified.
· Based on our professional judgement, we determined overall materiality for the Company non-statutory financial statements as a whole to be £3,500, based on a percentage of the net assets.
· We use a different level of materiality ('performance materiality') to determine the extent of our testing for the audit of the financial statements. Performance materiality is set based on the audit materiality as adjusted for the judgements made as to the entity risk and our evaluation of the specific risk of each audit area having regard to the internal control environment.
· Where considered appropriate performance materiality may be reduced to a lower level, such as, for related party transactions and directors' remuneration.
· We agreed with the Audit Committee to report to it all identified errors in excess of £175. Errors below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required on qualitative grounds.
Overview of the scope of our audit
· The Company is in the early stages of its development and is currently administered from one central operating location, which is the Company's registered office. Our audit work was conducted on records held at that location.
Key Audit Matters
· Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
· This is not a complete list of all risks identified by our audit.
|
Key audit matter |
How the scope of our audit addressed the key audit matter |
|
Treatment of share issue costs The company has incurred costs in relation to its post year end listing on the London Stock Exchange and a concurrent issue of shares. We considered the risk that costs had been incurred at the balance sheet date but either not recognised or incorrectly held as a prepayment. |
During the period to 30 April 2017 the company incurred professional fees in relation to the post period end listing on the main market of the stock exchange and also with regards to the issue of new shares. We have reviewed post period end invoices to assess the cut off of liabilities. We have considered the accounting of the costs and whether the costs to be taken to equity relate to the issue of new shares. Where a portion of the costs have been recognised in equity and profit and loss we have reviewed management's methodology in splitting the costs. |
Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole. They were not designed to enable us to express an opinion on these matters individually and we express no such opinion.
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the non-statutory financial statements and our auditor's report thereon. Our opinion on the non-statutory 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.
In connection with our audit of the non-statutory financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the non-statutory financial statements or our knowledge obtained in 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 there is a material misstatement in the non-statutory financial statements or a material misstatement of the other information. 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.
Responsibilities of the directors for the non-statutory financial statements
As explained more fully in the directors' responsibilities statement set out on pages 6 and 7, the directors are responsible for the preparation of the non-statutory 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 non-statutory financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the non-statutory 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 non-statutory financial statements
Our objectives are to obtain reasonable assurance about whether the non-statutory 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 non-statutory financial statements.
A further description of our responsibilities for the audit of the non-statutory financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Other matters which we are required to address
We were appointed by the Board on 6 June 2017 to audit the non-statutory financial statements for the period ending 30 April 2017. Our total uninterrupted period of engagement is 7 months, covering the period from 1 October 2016 to 30 April 2017.
The non-audit services prohibited by the FRC's Ethical Standard were not provided to the Company and we remain independent of the Company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit committee.
Matthew Stallabrass (Senior Statutory Auditor)
for and on behalf of
Crowe Clark Whitehill LLP
Statutory Auditor
London
30 August 2017
GRAND FORTUNE HIGH GRADE LIMITED
FOR THE PERIOD ENDED 30 APRIL 2017
FINANCIAL STATEMENTS OF THE COMPANY
STATEMENT OF COMPREHENSIVE INCOME
The statement of comprehensive income of the Company is stated below:
|
|
Note |
1 October 2016 to 30 April 2017
£ |
10 November 2015 to 30 September 2016 £ |
|
|
|
|
|
|
Revenue |
|
- |
- |
|
Administrative expenses |
4 |
(172,586) |
(136,136) |
|
Operating Loss |
|
(172,586) |
(136,136) |
|
Finance income |
|
2 |
__ 2 |
|
Loss before tax |
|
(172,584) |
(136,134) |
|
Taxation |
5 |
- |
______ - |
|
Total comprehensive loss for the period attributable to the equity holders of the Company |
|
(172,584) |
(136,134) |
|
Loss per Ordinary Share: |
|
|
|
|
Basic and diluted (pence) |
6 |
(0.15) |
(0.26) |
|
|
|
|
|
The notes to the financial statements form an integral part of these financial statements. |
||
GRAND FORTUNE HIGH GRADE LIMITED
FOR THE PERIOD ENDED 30 APRIL 2017
STATEMENT OF FINANCIAL POSITION
The statement of financial position of the Company is stated below:
|
|
Note |
At as 30 April 2017 £ |
As at 30 September 2016 £ |
|
Assets |
|
|
|
|
Current assets |
|
|
|
|
Other receivables |
7 |
7,055 |
43,250 |
|
Cash and cash equivalents |
|
31,947 |
31,915 |
|
Total assets |
|
39,002 |
75,165 |
|
|
|
|
|
|
Equity and liabilities |
|
|
|
|
Capital and reserves |
|
|
|
|
Share capital |
10 |
11,700 |
11,700 |
|
Accumulated losses |
|
(308,718) |
(136,134) |
|
Total equity attributable to equity holders of the Company |
|
(297,018) |
(124,434) |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
Amounts owing to Directors |
11 |
324,020 |
199,599 |
|
Other payables |
8 |
_ 12,000 |
______- |
|
Total liabilities |
|
336,020 |
199,599 |
|
|
|
__ ___ |
___ |
|
Total equity and liabilities |
|
39,002 |
75,165 |
The notes to the financial statements form an integral part of these financial statements.
This report was approved by the board and authorised for issue on 30 August 2017 and signed on its behalf by;
……………………………………Kit Ling Law - Chairman
GRAND FORTUNE HIGH GRADE LIMITED
FOR THE PERIOD ENDED 30 APRIL 2017
STATEMENT OF CHANGES IN EQUITY
The statements of changes in equity of the Company for period from incorporation on 10 November 2015 to 30 April 2017 are set out below:
|
|
Share capital £ |
Accumulated losses £ |
Total £ |
|
Balance on incorporation on 10 November 2015 |
- |
- |
- |
|
Loss for the period after taxation |
- |
(136,134) |
(136,134) |
|
Total comprehensive loss for the period |
- |
(136,134) |
(136,134) |
|
|
|
|
|
|
Ordinary Shares issued |
11,700 |
- |
11,700 |
|
Transactions with owners |
11,700 |
- |
11,700 |
|
Balance as at 30 September 2016 |
11,700 |
(136,134) |
(124,434) |
|
|
|
|
|
|
Balance on 30 September 2016 |
11,700 |
(136,134) |
(124,434) |
|
Loss for the period after taxation |
- |
(172,584) |
(172,584) |
|
Total comprehensive balances |
11,700 |
(308,718) |
(297,018) |
|
|
|
|
|
|
Transactions with owners |
- |
- |
- |
|
Balance as at 30 April 2017 |
11,700 |
(308,718) |
(297,018) |
The share capital comprises the Ordinary Shares of the Company.
Accumulated losses represent the aggregate retained loss of the Company since incorporation.
The notes to the financial statements form an integral part of these financial statements.
GRAND FORTUNE HIGH GRADE LIMITED
FOR THE PERIOD ENDED 30 APRIL 2017
CASH FLOW STATEMENT
The cash flow statement of the Company is set out below:
|
|
1 October 2016 to 30 April 2017
£ |
10 November 2015 to 30 September 2016 £ |
|
Cash flows from operating activities |
|
|
|
Loss for the period before taxation |
(172,584) |
(136,134) |
|
Finance income |
(2) |
(2) |
|
Adjustments for non-cash items: |
|
|
|
Foreign currency loss |
(172) |
1,598 |
|
Foreign currency loss (Bank Charges) |
16 |
- |
|
Working capital adjustments: |
|
|
|
Increase in other receivables
Increase in other payables |
36,195
132,400 |
(43,250)
103,200 |
|
Net cash used in operating activities |
(4,147) |
(74,588) |
|
|
|
|
|
Cash flows from investing activities |
|
|
|
Interest received |
2 |
2 |
|
Net cash flow from investing activities |
2 |
2 |
|
|
|
|
|
Cash flows from financing |
|
|
|
Receipt of Director's loan |
4,177 |
94,801 |
|
Proceeds from the issue of Ordinary Shares |
- |
11,700 |
|
Net cash inflow from financing activities |
4,177 |
106,501 |
|
|
|
|
|
Increase in cash |
32 |
31,915 |
|
Cash and cash equivalents, beginning of the period |
31,915 |
- |
|
Cash and cash equivalents, end of the period |
31,947 |
31,915 |
NOTES TO THE FINANCIAL STATEMENTS
1. General Information
The Company is a company incorporated under the laws of the Cayman Islands under the Companies Law. The Company was incorporated 10 November 2015 as an exempted company. The Company's registered number is 305700 and its registered office is at Willow House, Cricket Square, PO Box 709, Grand Cayman KY1-1107, Cayman Islands
The Company's objective is to take advantage of opportunities to establish a financial training business.
This financial information has been prepared in accordance with IFRS as adopted by the European Union ("EU"). The standards have been applied consistently during the period under review.
2. Accounting Policies
Basis of preparation
The principal accounting policies adopted by the Company in the preparation of the financial information are set out below.
The financial information has been presented in pound sterling, being the functional currency of the Company.
The financial information has been prepared in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS"), including interpretations made by the International Financial Reporting Interpretations Committee (IFRIC) issued by the International Accounting Standards Board (IASB). The standards have been applied consistently.
Comparative figures
The financial information presents the comparative figures for the period from incorporation on 10 November 2015 to 30 September 2016 and the financial information for the period from 1 October 2016 to 30 April 2017. These comparatives are not comparable due to the differing period lengths.
NOTES TO THE FINANCIAL STATEMENTS (continued)
2. Accounting Policies (continued)
Standards and interpretations issued but not yet applied
A number of new standards and amendments to standards and interpretations have been issued but are not yet effective and in some cases have not yet been adopted by the European Union.
The directors do not expect that the adoption of these standards will have a material impact on the financial statements of the company in future periods.
Going concern
The company is focused on the development, by organic growth, of a financial training business in China, and, apart from a small amount of interest receivable, currently has no income stream. Until the training business has been adequately developed and is generating revenue, it is therefore dependent on its cash reserves to fund ongoing costs. At 30 April 2017, the Company's cash position was £31,947 (with additional gross proceeds of £4,300,000 from the completion of the Placing subsequent to 30 April 2017 - see note 15 to the accounts).
After reviewing the company's budget for the period ending 31 October 2018 and its medium term plans (including the completion of the Placing in May 2017 - see note 15 to the accounts), the directors have a reasonable expectation that the company will have adequate resources to continue in operational existence for the foreseeable future.
The financial information does not include any adjustments that would result if the Company were unable to continue as a going concern.
Taxation
The tax currently payable is based on the taxable profit for the period. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.
NOTES TO THE FINANCIAL STATEMENTS (continued)
2. Accounting Policies (continued)
Financial instruments
Financial assets and financial liabilities are recognised on the statement of financial position when the Company becomes a party to the contractual provisions of the instrument.
Financial assets
Financial assets within the scope of IAS 39 are classified as either:
· financial assets at fair value through profit or loss;
· loans and receivables;
· held-to-maturity investments; or
· available-for-sale financial assets.
The classification depends on the purpose for which the financial assets were acquired. The Directors determine the classification of its financial assets at initial recognition and re-evaluate this classification at every reporting date.
The Company has classified cash and cash equivalents as "loans and receivables".
As at the balance sheet date, the Company did not have any "financial assets at fair value through profit or loss", "held-to-maturity investments" or "available-for-sale financial assets".
Financial liabilities and equity instruments
Classification as debt or equity
Financial liabilities and equity instruments issued by the Company are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.
NOTES TO THE FINANCIAL STATEMENTS (continued)
2. Accounting Policies (continued)
Financial liabilities
Financial liabilities are classified as either financial liabilities at fair value through profit or loss or financial liabilities measured at amortised cost.
Financial liabilities are classified as at fair value through profit or loss if the financial liability is either held for trading or it is designated as such upon initial recognition.
Other financial liabilities
The Director's loan is initially measured at amortised cost, net of transaction costs, and are subsequently measured at amortised cost, where applicable, using the effective interest method, with interest expense recognised on an effective yield basis.
Derecognition of financial liabilities
The Company derecognises financial liabilities when, and only when, the Company's obligations are discharged, cancelled or they expire.
Foreign currencies
Profit and loss account transactions denominated in foreign currencies are translated into sterling and recorded at the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date.
All differences are taken to the profit and loss account.
Cash and cash equivalents
The Company considers any cash on short-term deposits and other short-term investments to be cash equivalents.
NOTES TO THE FINANCIAL STATEMENTS (continued)
3. Critical accounting estimates and judgement
The preparation of the financial information in conformity with IFRS requires the Directors to make estimates and assumptions that affect the reported amounts of income, expenditure, assets and liabilities. Estimates and judgements are continually evaluated, including expectations of future events to ensure these estimates to be reasonable.
The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
The Company's nature of operations is to develop and run financial training courses in China. The only significant accounting judgement is that costs incurred in relation to the potential admission have been recognised as an asset until such a time that admission has occurred as in the directors opinion it is probable that a transaction will occur.
4. Administrative expenses
|
|
1 October 2016 to 30 April 2017
£ |
10 November 2015 to 30 September 2016 £ |
|
Directors remuneration
Legal and professional fees |
120,400
50,282 |
103,200
28,515 |
|
Bank charges |
76 |
2,823 |
|
Foreign currency (gain) / loss |
(172) |
1,598 |
|
|
172,586 |
136,136 |
Audit fees of £12,000 (2016: £nil) were recognised in the period and an additional £6,250 non-audit service fees were recognised for corporate finance fees relating to acting as reporting accountants to the Company.
5. Taxation
The Company is incorporated in the Cayman Islands. All costs have been incurred by this Company and, as such, the loss incurred in the period is subject to Cayman Islands taxation legislation. The prevailing taxation rate is 0%.
NOTES TO THE FINANCIAL STATEMENTS (continued)
6. Loss per Ordinary Share
The calculation for earnings per Ordinary Share (basic and diluted) for the relevant period is based on the profit after income tax attributable to equity holder is as follows:
|
|
1 October 2016 to 30 April 2017 |
10 November 2015 to 30 September 2016 |
|
Loss attributable to equity holders (£) |
(172,584) |
(136,134) |
|
Weighted average number of Ordinary Shares |
117,000,000 |
53,285,446 |
|
Earnings per share (pence) |
(0.15) |
(0.26) |
7. Other receivables
|
|
As at 30 April 2017 £ |
As at 30 September 2016 £ |
|
Prepayments |
7,055 |
43,250 |
|
|
7,055 |
43,250 |
8. Other payables
|
|
As at 30 April 2017 £ |
As at 30 September 2016 £ |
|
Accruals |
12,000 |
_______-_ |
|
|
12,000 |
- |
NOTES TO THE FINANCIAL STATEMENTS (continued)
9. Key management personnel
Directors are considered the only key management personnel and the following directors' remuneration was accrued in the periods below.
|
|
As at 30 April 2017
£
|
As at 30 September 2016 £
|
|
Hong Lin Cao Yan Wing Laurence Cheung Kit Ling Law Yan Xu Yong Yang Sandy Jadeja Angus Irvine |
17,500 15,400 10,500 10,500 17,500 24,500 24,500 |
15,000 13,200 9,000 9,000 15,000 21,000 21,000 |
|
|
120,400 |
103,200 |
10. Share capital
|
|
As at 30 April 2017
£
|
As at 30 September 2016 £
|
|
117,000,000 Ordinary Shares of £0.001 each, fully paid |
11,700 |
11,700 |
|
|
11,700 |
11,700 |
On 10 November 2015, the Company was incorporated and on incorporation, the issued share capital of the Company was £0.0001 comprising 1 Ordinary Share of £0.0001 which was issued to Kit Ling Law at par for cash.
NOTES TO THE FINANCIAL STATEMENTS (continued)
10. Share capital (continued)
On 10 November 2015, the Company allotted a further 9,999 Ordinary Shares at par for cash consideration of £1.
On 6 May 2016, the Company allotted a further 116,990,000 Ordinary Shares at par for cash consideration of £11,699.
11. Amounts owing to Directors
|
|
As at 30 April 2017
£ |
As at 30 September 2016 £ |
|
Kit Ling Law |
100,420 |
96,399 |
|
Directors Fees |
223,600 |
103,200 |
|
|
324,020 |
199,599 |
During the period from incorporation 10 November 2015 to the period ended 30 September 2016, Kit Ling Law loaned the Company £96,399 to provide initial working capital. During the period from 1 October 2016 to the period ended 30 April 2017, Kit Ling Law loaned the Company an additional £4,021.
The loan is unsecured, interest free and is repayable on demand.
The maximum amount owing to Kit Ling Law during the period ended 30 April 2017 was £119,920.
Kit Ling Law is a related party by virtue of her being Chairman and shareholder of the Company.
The above Directors fees payable relates to directors' remuneration between April 2016 and the respective periods listed above. As of 30 April 2017 none of these amounts have been paid out and are shown as having been accrued.
NOTES TO THE FINANCIAL STATEMENTS (continued)
12. Financial instruments
|
Financial assets |
As at 30 April 2017
£ |
As at 30 September 2016 £ |
|
Loans and receivables |
|
|
|
Cash and cash equivalents |
31,947 |
31,915 |
|
Total financial assets |
31,947 |
31,915 |
|
Financial liabilities at amortised cost |
|
|
|
Amounts owing to Directors |
324,020 |
199,599 |
|
Other payables |
12,000 |
______ ___-_ |
|
Total financial liabilities |
336,020 |
199,599 |
13. Financial risk management
The Company uses a limited number of financial instruments, comprising cash and amounts owing to Directors, which arise directly from operations. The Company does not trade in financial instruments.
General objectives, policies and processes
The Directors have overall responsibility for the determination of the Company's risk management objectives and policies. Further details regarding these policies are set out below:
Currency risk
As the Company operates internationally, its exposure to foreign exchange risk relates to transactions and balances that are denominated in currencies other than £. The Directors manage the Company's exposure to currency risk by operating foreign currency bank accounts, being £, HKD, RMB and USD. It is the Directors' view that the size and complexity of the Company's trade does not warrant financial hedging arrangements currently, although this view will be regularly reviewed as the Company develops.
NOTES TO THE FINANCIAL STATEMENTS (continued)
14. Financial risk management (continued)
Credit risk
Credit risk is the risk that a counter party will not meet its obligations under a contract, leading to a financial loss. The Company had cash and cash equivalents of £31,947 as at 30 April 2017. The credit risk from its liquid funds is limited as the counter parties are banks with high credit ratings which have not experienced any losses in such accounts.
Liquidity risk
Liquidity risk arises from the Directors' management of working capital. It is the risk that the Company will encounter difficulty in meeting its financial obligations as they fall due.
The Directors' policy is to ensure that the Company will always have sufficient cash to allow it to meet its liabilities when they become due. To achieve this aim, the Directors seek to maintain a cash balance sufficient to meet expected requirements.
The Directors have prepared cash flow projections on a monthly basis through to 31 March 2018. At the end of the period under review, these projections indicated that the Company expected to have sufficient liquid resources to meet its obligations under all reasonably expected circumstances.
15. Capital risk management
The Directors' objectives when managing capital are to safeguard the Company's ability to continue as a going concern in order to provide returns for Shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. At the date of this financial information, the Company had been financed by equity and Directors' loans. In the future, the capital structure of the Company is expected to consist of equity attributable to equity holders of the Company, comprising issued share capital and reserves.
NOTES TO THE FINANCIAL STATEMENTS (continued)
16. Subsequent events
The Company has committed to £303,200 of costs in relation to the Admission and Placing, of which £43,250 have already been paid.
On 22 May 2017, the Company completed the Placing of 43,000,000 ordinary shares issued at a price of £0.10 per ordinary share for gross proceeds of £4,300,000. In connection with the Placing, the Ordinary Shares of the Company were admitted by the Financial Conduct Authority (FC) to a Standard Listing on the Official List in accordance with Chapter 14 of the Listing Rules and commenced trading on the London Stock Exchange's main market for listed securities.
17. Related party transactions
During the period from incorporation 10 November 2015 to the period ended 30 September 2016, Kit Ling Law loaned the Company £96,399 to provide initial working capital. During the period from 1 October 2016 to the period ended 30 April 2017, Kit Ling Law loaned the Company an additional £4,021 bringing the total loan to £100,420. Kit Ling Law is a related party by virtue of her being Chairman and shareholder of the Company. The maximum amount owing to Kit Ling Law during the period ended 30 April 2017 was £119,920, being the balance outstanding as at 30 April 2017.
All other amounts owing to directors relate to directors' remuneration accrued between April 2016 and the period ended 30 April 2017, see note 8 and 9 for a summary.
18. Ultimate controlling party
As at 30 April 2017, the Company did not have any one identifiable controlling party.
For further information, please contact:
Nick Bealer
Cornhill Capital
Corporate Broking
4th Floor, 18 St Swithins Lane
London
EC4N 8AD
Tel: 020 3700 2500
This information is provided by RNS
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