TIDMHOYE
RNS Number : 0175H
Honye Financial Services Ltd
30 November 2020
30 November 2020
Honye Financial Services Ltd
Final Results for the year ended 31 July 2020
The Directors of Honye are pleased to announce the Company's
audited final results for the year ended 31 July 2020.
The Annual Report will be available on the Company's website:
www.honyefinance.com
The Directors accept responsibility for this announcement.
Enquiries:
Honye Financial Services Ltd garethmedwards@gmail.com
Gareth Edwards
Peterhouse Capital Limited Tel: 020 7469 0933
Heena Karani
The Company's financial statements have been extracted, without
material change, from the Company's Annual Report.
FINANCIAL AND OPERATIONAL SUMMARY
The loss for the year to 31 July 2020 was GBP427,385. This
primarily reflects the day-to-day administrative expenses and due
diligence into prospective targets.
The loss per share was GBP0.017.
At 31 July 2020, the Company had cash of GBP1.575 million,
derived from the subscription and admission to the Standard Listing
segment of the London Stock Exchange in December 2018.
CHAIRMAN'S STATEMENT
Honye Financial Services Ltd ("Honye") was formed as a special
purpose company ("SPAC") to undertake one or more acquisitions of a
company or businesses in the financial services and in particular
the fintech sector principally in Europe and Asia.
The Company has been actively searching for and analysing
potential acquisitions but has not, so far, found one which
satisfies our criteria. Honye will continue to explore other
possibilities and as news of our area of focus has become more
widely known, potential opportunities are being brought to the
Company's attention.
The fintech sector has continued to grow since Honye's Admission
and with it the number of potential acquisition targets. As per the
Prospectus, in the event that the Company is not able to complete a
reverse takeover before its second anniversary, the Board will
recommend to Shareholders that the Company continues to pursue an
Acquisition for a further 24 months from the date of its second
anniversary. The Board's recommendation will then be put to a
Shareholder vote (from which the Directors will abstain).
The impact of COVID 19 still continues and its effect on the UK
economy is still hard to gauge due to the beneficial effects of the
various government support schemes. However widespread job losses
in the UK are widely predicted for late 2020 into early 2021. Your
Board is also conscious of the impending 31 December 2020 deadline
for the end of the transition period to leave the European Union.
At the time of writing no trade deal has been agreed with the
European Union. Therefore it is difficult to predict precisely what
is to happen on 1 January 2021. While leaving the European Union
with or without a deal may influence the types of businesses Honye
is prepared to acquire it will not affect the Company's day to day
functioning. As a result of Honye's cautious approach to investment
and identification of suitable acquisition candidates its running
costs are low and its main assets is cash in the bank.
We are optimistic but will approach any prospective companies to
invest in or acquire with renewed caution.
Gareth Edwards
Non-Executive Chairman
30 November 2020
DIRECTORS' REPORT
The Directors present this report on the Company, together with
the audited financial statements of the Company for the year from 1
August 2019 to 31 July 2020.
Principal activities
The Company was formed to undertake acquisitions in a company or
businesses principally in Europe and Asia.
Dividends
The Directors do not propose a dividend for the year ended 31
July 2020.
Post balance sheet events
There have been no material events that have occurred since the
year end that require further disclosure.
Directors
The Directors of the Company who have served during the year and
at the date of this report are:
Director Name Role Date of Appointment
Xu, Wanbao Executive Director 18 July 2018
-------------------------- --------------------
Gareth Maitland Independent Non-executive 7 December 2018
Edwards Director
-------------------------- --------------------
Shaun Carew-Wootton Independent non-executive 7 December 2018
director
-------------------------- --------------------
Yu Xing Liu Executive Director 7 April 2020
-------------------------- --------------------
Donations
No political or charitable donations have been made in the
year.
Provision of information to auditors
Each of the persons who are Directors at the time when this
Directors' Report is approved has confirmed that:
-- so far as that Director is aware, there is no relevant audit
information of which the Company's auditor is unaware, and;
-- each Director has taken all the steps that ought to have been
taken as a director in order to be aware of any relevant audit
information and to establish that the Company's auditor is aware of
that information.
Independent auditors
The Company's auditor is BDO LLP, 55 Baker Street, London W1U
7EU.
By order of the board
Wanbao Xu
Executive Director
30 November 2020
CORPORATE GOVERNANCE REPORT
Introduction
The Board recognises the importance and value for the Company
and its shareholders of good corporate governance. The Company
Statement on Corporate Governance is set out below.
Board
The Board is currently comprised of:
Gareth Edwards, Independent Non-Executive Chairman
Shaun Carew-Wootton, Independent Non-Executive Director
Wanbao Xu, Executive Director
Yu Xing Liu, Executive Director
Mr Wanbao Xu is also considered as a main shareholder by virtue
of his indirect significant securities in the Company as at 31 July
2020.
The terms and conditions of appointment of the non-executive
directors are available for inspection at the Company's registered
office.
For the year ending 31 July 2020 there were five Board Meetings
and all directors were in attendance and Mr Yu Xing Li has attended
all Board Meetings since his appointment on 6(th) April 2020. There
were no separate committee meetings during the year.
The Executive Directors work full time for the Company
committing such time as may be required to service the needs of the
Company. The Non-Executive Directors are contractually committed to
one day per month to fulfil their obligations to the Company but
would commit such other time as may be necessary to service the
needs of the Company.
The Company has no business or trade and so the skills required
for the directors to carry out their duties,at this stage, are
limited to corporate governance.
Gareth Edwards, the Non-Executive Chairman, is a solicitor and
has practised Corporate law relating to publicly listed companies
for 35 years and as part of the annual renewal of his practising
certificate is required to undertake "Continuing Professional
Development" which keeps his knowledge of the law and corporate
governance requirements current. The other directors undertake such
research, reading and courses necessary to keep themselves up to
date.
In his capacity as Non-Executive Chairman, Gareth Edwards has
assumed responsibility for leading the Board effectively and
ensuring the Company has appropriate corporate governance in place
and that these standards are observed and applied in the Company.
When the Company makes an acquisition the Board will review the
corporate governance to ensure it adapts to take account of the
newly acquired business.
Corporate Governance Statement
As a company with a Standard Listing the Company is not required
to comply with the provisions of the UK Corporate Governance Code.
Nevertheless, the Directors are committed to maintaining high
standards of corporate governance and propose, so far as is
practicable given the Company's size and nature, to voluntarily
adopt and comply with the QCA Code (available on the QCA's website
(www.theqca.com)). However at present, due to the size of the
Company, the Directors acknowledge that adherence to certain other
provisions of the QCA Code may be delayed until such time as the
Directors are able to fully adopt them. In particular, action will
be required in the following areas:
-- in keeping with the QCA Code provisions on board composition,
the Company has separated the roles of chairman and executive
director. As the Company grows, the Board will seek to appoint
additional independent directors, one of whom will be appointed as
senior independent director;
-- the Company is currently too small to have an audit
committee, a remuneration committee or a nominations committee
established and the appointments to such committees will be
revisited upon the completion of an Acquisition along with
incorporating terms of reference for them;
-- the QCA Code recommends that companies publish key
performance indicators which align with strategy and feedback
through regular meetings with shareholders and directors. The
Company will not comply with this provision until after such time
as it has made an Acquisition; and
-- given the Company's size, it has not yet developed a
corporate and social responsibility policy or diversity policy. One
will be put in place at the appropriate time.
In line with the QCA Code, the Company holds timely board
meetings as issues arise which require the attention of the Board.
The Board is responsible for the management of the business of the
Company, setting the strategic direction of the Company and
establishing the policies of the Company. It is the Directors'
responsibility to oversee the financial position of the Company and
monitor the business and affairs of the Company, on behalf of the
Shareholders, to whom they are accountable. The primary duty of the
Directors is to act in the best interests of the Company at all
times. The Board also addresses issues relating to internal control
and the Company's approach to risk management.
The Board as a whole will be responsible for sourcing
Acquisitions and ensuring that opportunities are in conformity with
the Company's strategy. The Board will meet periodically to: (i)
discuss possible Acquisition opportunities for the Company; (ii)
monitor the deal flow and acquisitions in progress; and (iii)
review the Company's strategy and ensure that it is up-to-date and
appropriate for the Company and its aims.
The Directors are responsible for internal controls in the
Company and for reviewing effectiveness. Due to the size of the
Company, all key decisions are made by the Board. The Directors
have reviewed the effectiveness of the Company's internal controls
during the year under review and consider that there have been no
material losses, contingencies or uncertainties due to weaknesses
in the controls.
Share Dealings
The Company has voluntarily adopted a dealing code and
procedures manual which complies with the Market Abuse Regulation
(EU) No 596/2014 and will take all reasonable steps to ensure
compliance by the Directors and any relevant individuals.
Annual General Meeting
Normally at every AGM individual shareholders are given the
opportunity to put questions to the Chairman and to other members
of the Board that may be present. However under the provisions of
the Corporate Insolvency and Governance Act 2020, the AGM this year
will be a closed meeting. This means shareholders must not attend
the AGM in person and anyone attempting to do so will be refused
entry.
The Company will ensure a quorum is present to allow the formal
business of the AGM to be transacted. Voting on all resolutions
will be taken by way of a poll whereby shareholder votes are
counted according to the number of shares held by each shareholder.
Notice of the AGM will be sent to shareholders before the meeting,
which is planned to be on 11 January 2021 at 201 Bishopsgate,
Spitalfields, London EC2M 3AB. Details of proxy votes for and
against each resolution, together with the votes withheld are
announced to the London Stock Exchange and are published on the
Company's website as soon as practical after the meeting.
Gareth Edwards
Non-Executive Chairman
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the financial
statements in accordance with applicable law and regulations.
Cayman Islands Company law requires the Directors to prepare
financial statements for each financial period. Under that law the
Directors have elected to prepare the financial statements in
accordance with International Financial Reporting Standards as
adopted by the European Union ("IFRS"). The Directors must not
approve the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that
period.
In preparing these financial statements, the directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and estimates that are reasonable and prudent;
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business
The Directors are responsible for causing to be kept proper
books of account with respect to:
-- all sums of money received and expensed by the Company and
the matters in respect of which the receipt and expenditure takes
place;
-- all sales and purchases of goods by the Company; and
-- the assets and liabilities 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.
Independent auditor's report to the members of Honye Financial
Services Limited
Opinion
We have audited the financial statements of Honye Financial
Services Limited (the 'Company') for the year ended 31 July 2020
which comprise of the statement of comprehensive income, the
statement of changes in equity, the statement of financial
position, the statement of cash flows, and notes to the financial
statements, including a summary of significant accounting
policies.
The financial reporting framework that has been applied in their
preparation is applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the European Union
In our opinion the financial statements:
-- give a true and fair view of the state of the Company's
affairs as at 31 July 2020 and of its loss for the year then ended;
and
-- have been properly prepared in accordance with IFRSs as adopted by the European Union.
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 as
applied to listed entities, 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 the ISAs (UK) require us to report to you
where:
-- the Directors' use of the going concern basis of accounting
in the preparation of the financial statements is not appropriate;
or
-- the Directors have not disclosed in the 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 financial statements are authorised for
issue.
Key audit matters
Key audit matters are those matters that, in our professional
judgment, 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 including 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.
This matter was 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 this
matter.
Key audit matter How we addressed the key audit
matter in the audit
Completeness, existence and
accuracy of expenditure Audit procedures were designed
to mitigate the risk of misstatement
relating to the completeness,
The Company has not started existence and accuracy of administrative
earning any revenue and hence expenses. Audit Procedures
administrative expenses form include:
the most significant assessed
risk of material misstatements -- For accuracy, we tested
in the financial statements. 100% of all administrative
expenses including director
There are no significant areas fees above performance materiality.
of estimation, uncertainty Transactions recorded in the
and critical judgements in accounting system were traced
applying accounting policies to expense invoices or supporting
related to expenditure that documentation to ensure that
have significant effect on the amounts on the invoices
the amount recognised in the agreed with the expenses ledger.
financial statements.
-- For directors' fees we traced
Therefore, completeness, existence expenditure paid to service
and accuracy of administrative level agreements signed by
expenses is considered to directors and traced any payments
be a significant risk and made to the bank statements
key audit matter.
-- For completeness, the full
period of bank transactions
was obtained (e.g. from the
bank statements) and checked
against expense ledger to ensure
all transactions have been
recorded. Additionally we have
reviewed post year end payments
and unpaid invoices to ensure
expenditure cut off is correct.
-- For existence we obtained
supplier listing from management;
and for all expenses incurred
in the year that were charged
by a third party supplier,
we obtained the respective
invoices and checked the names
of all suppliers against the
supplier listing
Key observations
Based on our procedures performed
we did not identify any unadjusted
material misstatement relating
to administrative expenses.
----------------------------------------------
Our application of materiality
We apply the concept of materiality both in planning and
performing our audit, and in evaluating the effect of
misstatements. We consider materiality to be the magnitude by which
misstatements, including omissions, could influence the economic
decisions of reasonable users that are taken on the basis of the
financial statements. In order to reduce to an appropriately low
level the probability that any misstatements exceed materiality we
use a lower materiality level, performance materiality, to
determine the extent of testing needed. Importantly, misstatements
below these levels will not necessarily be evaluated as immaterial
as we also take account of the nature of identified misstatements,
and the particular circumstances of their occurrence, when
evaluating their effect on the financial statements.
The application of these key considerations gives rise to two
levels of materiality, the quantum and purpose of which are
tabulated below.
Materiality Measure Purpose Quantum (GBP)
Financial statement Assessing whether GBP5,500(2019: GBP33,900)
materiality was set the financial statements
at 1.5 % of gross as a whole present
expenditure(2019: a true and fair view.
5% of loss before
tax), prior to consideration
of qualitative factors
(as listed below)
------------------------------ -----------------------------
Performance materiality Lower level of materiality GBP4,100(2019: GBP23,000)
was set at 75%(2019:68%) applied in performance
of financial statement of the audit when
materiality determining the nature
and extent of testing
applied to individual
balances and classes
of transactions.
------------------------------ -----------------------------
The Company is still in its early stages of development and has
not yet made any investment therefore the Company has no income and
has limited transactions.
- Financial statement materiality was set at 1.5% of gross
expenditure (2019:5%of loss before tax) as the Company is still in
its early stages of development and incurring costs relating to
potential investments opportunities. In addition, it has not earned
any income and hence gross expenditure has been considered the most
appropriate measure as it is the main factor of particular interest
to the users of the financial statements.
- Performance materiality was set at 75% of financial statement
materiality (2019:68%) due to the fact that there are relatively
few financial statement accounts. In setting performance
materiality, we had regard to the financial statement materiality
and risk and control environment.
We agreed with the Board that we would report all audit
differences in excess of GBP100 (2019: GBP1,670) as well as
differences below that threshold that, in our view, warranted
reporting on qualitative grounds.
An overview of the scope of our audit
We designed our audit by determining materiality and assessing
the risks of material misstatements in the financial statements. In
particular, we looked at where the directors make subjective
judgements. We also addressed the risk of management override of
internal controls, including assessing whether there was evidence
of bias by the directors that represented a risk of material
misstatement due to fraud.
The Company and accounting records are based in the United
Kingdom and all audit work was conducted in the United Kingdom by
BDO LLP.
Other information
The Directors are responsible for the other information. The
other information comprises the information included in the annual
report and financial statements, 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. In
connection with our audit of the financial statements, 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
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 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 the other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of Directors
As explained more fully in the statement of Directors'
responsibilities statement set out on page 6, the Directors are
responsible for the preparation of the financial statements and for
being satisfied that they give a true and fair view, and for such
internal control as the Directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are
responsible for assessing the Company's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Company or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
A further description of our responsibilities for the audit of
the 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.
Use of our report
This report is made solely to the Company's members, as a body,
in accordance with the terms of our engagement letter dated 2
October 2020. 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, for our audit work, for this report, or for the opinions
we have formed.
BDO LLP
Chartered Accountants
London, UK
30 November 2020
BDO LLP is a limited liability partnership registered in England
and Wales (with registered number OC305127).
STATEMENT OF COMPREHENSIVE INCOME
Period from
Year Ended 31/07/2020 25/04/2018
Continuing operations Note GBP to 31/07/2019
GBP
Administrative expenses (427,385) (678,195)
--------------------------- --------------
Operating loss (427,385) (678,195)
--------------------------- --------------
(678 ,195
Loss before taxation (427,385) )
--------------------------- --------------
Taxation 10 - -
--------------------------- --------------
Total comprehensive loss attributable
to equity holders of the Company
for the period (427,385) (678 ,195 )
--------------------------- --------------
Loss per share - basic and diluted
(pence per share) 11 1.7 5.4
STATEMENT OF FINANCIAL POSITION
Note As at As at
31/07/2020 31/07/2019
GBP GBP
Assets
Current assets
Cash and cash equivalents 12 1,575,076 1,863,098
Prepayments 28,536 -
------------- --------------
Total current assets 1,603,612 1,863,098
------------- --------------
Total assets 1,603,612 1,863,098
============= ==============
Equity and liabilities
Capital and reserves
attributable to owners
of the company
Ordinary shares 14 246,714 246,414
Share premium 2,252,892 2,248,692
Accumulated losses (1,105,580) (678,195)
------------- --------------
Total equity 1,394,026 1,816,911
------------- --------------
Current liabilities
Trade and other payables 13 209,586 46,187
Total current liabilities 209,586 46,187
------------- --------------
Total equity and liabilities 1,603,612 1,863,098
============= ==============
These financial statements were authorised for
issue by the Board of Directors on 30 November
2020 and signed on behalf by:
Wanbao Xu
Executive Director
STATEMENT OF CHANGES IN EQUITY FOR THE
YEARED 31 JULY 2020
Note Share capital Share Accumulated
premium Losses Total equity
GBP GBP GBP GBP
Issue of shares on
incorporation
on 25 April 2018 14 35,970 - - 35,970
Share capital
repurchase (35,970) - - (35,970)
Issue of new share
capital
on admission
subscription 14 246,414 2,248,692 - 2,495,106
Total comprehensive
loss
for the year - - (678,195) (678,195)
====================== ==================== ================== ===============
Balance as at 31
July
2019 246,414 2,248,692 (678,195) 1,816,911
New shares issued 14 300 4,200 - 4,500
Total comprehensive
loss
for the financial
year - - (427,385) (427,385)
---------------------- -------------------- ------------------ ---------------
Balance as at 31
July
2020 246,714 2,252,892 (1,047,277) 1,394,026
====================== ==================== ================== ===============
STATEMENT OF CASH FLOWS
Period from
Year Ended 31/07/2020 25/04/2018
to 31/07/2019
GBP GBP
Cash flows from operating activities
Loss before taxation (427,385) (678,195)
Increase in receivables (28,536) -
Increase in payables 163,399 46,189
--------------------------------- ----------------------
Net cash used in operating activities (292,522) (632,006)
--------------------------------- ----------------------
Cash flows from financing activities
Proceeds from issue of ordinary shares 4,500 2,495,105
Net cash generated from financing activities 4,500 2,495,105
--------------------------------- ----------------------
Net (decrease)/increase in cash and cash
equivalents (288,022) 1,863,098
Cash and cash equivalents at beginning
of the period 1,863,098 -
--------------------------------- ----------------------
Cash and cash equivalents at end of the
year 1,575,07 6 1,863,098
================================= ======================
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL INFORMATION
The Company was incorporated and registered in the Cayman
Islands as a private company limited by shares on 25 April 2018
under the Companies Law (as revised) of The Cayman Islands, with
the name Honye Financial Services Limited, and registered number
336262.
The Company's registered office is located at Ogier Global
(Cayman) Limited, 89 Nexus Way, Camana Bay, Grand Cayman, KY1-9901,
Cayman Islands.
2. PRINCIPAL ACTIVITIES
The principal activity of the Company is to undertake
acquisitions in a company or businesses principally in Europe and
Asia.
3. RECENT ACCOUNTING PRONOUNCEMENTS
There are a number of standards and interpretations which have
been issued by the International Accounting Standards Board that
are effective for periods beginning subsequent to 31 July 2020 that
the Company has decided not to adopt early:
-- Amendments to IAS 1 and IAS 8
-- Amendments to IFRS 3
-- Amendments to IFRS 16
-- Amendments to IAS 37
-- Amendments to IAS 1
-- Amendments to IFRS 10 and IAS 28
-- Amendments to IFRS 17 Insurance Contracts
The Directors do not believe these standards and interpretations
will have a material impact on the financial statements once
adopted.
4. SIGNIFICANT ACCOUNTING POLICIES
a) Basis of preparation
The financial information has been prepared in accordance with
International Financial Reporting Standards ("IFRS") as adopted by
the European Union and prepared on a going concern basis, under the
historic cost convention.
The financial information is presented in Pounds Sterling (GBP),
which is the Company's functional currency.
A summary of the principal accounting policies of the Company
are set out below.
b) Going concern
The Company has assessed the Covid-19 impact on its ability to
continue as a going concern. The Company considers that the events
arising from the Covid-19 outbreak do not impact on its use of the
going concern basis of preparation nor do they cast significant
doubt over the company's ability to continue as a going concern for
the period of at least twelve months from the date when the
financial statements are authorised for issue.
The Company meets its day-to-day working capital requirements
through cash generated from the capital it has raised on admission
to the London Stock Exchange and subsequently it has GBP1.6 million
in cash as at 31 July 2020 which is sufficient for its present
needs. The Company is likely to need to raise additional funds for
planned acquisitions and this will likely be obtained through
further transactions through the market.
Taking its cash position into account, the Directors are
satisfied that the Company has adequate resources to continue in
operational existence for the foreseeable future and for a period
of not less than 12 months from the date of signing the financial
statements. Thus they continue to adopt the going concern basis of
accounting in preparing the financial statements.
c) Foreign currency translation
The financial statements of the Company are presented in the
currency of the primary environment in which the Company operates
(its functional currency).
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year
end exchange rates of monetary assets and liabilities denominated
in foreign currencies are recognised in profit and loss.
d) Financial instruments
A financial asset or a financial liability is recognised only
when the Company becomes a party to the contractual provisions of
the instrument. Financial assets and financial liabilities are
initially measured at fair value.
Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial liabilities
(other than financial assets and financial liabilities at fair
value through profit or loss) are added to or deducted from the
fair value of the financial assets or financial liabilities, as
appropriate, on initial recognition.
Transaction costs directly attributable to the acquisition of
financial assets or financial liabilities at fair value through
profit or loss are recognised immediately in profit or loss.
Financial assets
All financial assets are recognised and derecognised on a trade
date where the purchase or sale of a financial asset is under a
contract whose terms require delivery of the financial asset within
the timeframe established by the market concerned, and are
initially measured at fair value.
Financial assets are subsequently classified into the following
specified categories: Financial assets measured at fair value
through profit and loss (FVTPL), Financial assets measured at
amortised cost and Financial assets measured at fair value through
other comprehensive income .The Company's financial assets measured
at amortised cost comprise cash and cash equivalents in the
statement of financial position
Financial liabilities
The Company's financial liabilities include other payables and
accruals. Financial liabilities are recognised when the Company
becomes a party to the contractual provision of the instrument. All
financial liabilities are recognised initially at their fair value,
net of transaction costs, and subsequently measured at amortised
cost, using the effective interest method, unless the effect of
discounting would be insignificant, in which case they are stated
at cost.
The Company derecognises financial liabilities when, and only
when, the Company's obligation are discharged, cancelled or they
expire.
4. SIGNIFICANT ACCOUNTING POLICIES (Continued)
e) Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held on
call with banks and other short term (having maturity within 3
months) highly liquid investments that are readily convertible into
known amounts of cash and which are subject to an insignificant
risk of changes in value.
5. ACCOUNTING ESTIMATES AND JUDGEMENTS
Preparation of financial information in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported
amounts of assets, liabilities, income and expenses. 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
judgements about carrying values of assets and liabilities that are
not readily apparent from other sources.
It is the Directors' view that there are no significant areas of
estimation, uncertainty and critical judgements in applying
accounting policies that have significant effect on the amount
recognised in the financial information for the period.
6. FINANCIAL RISK MANAGEMENT
a) Objectives and policies
The Company is exposed to a variety of financial risks: market
risk, credit risk and liquidity risk. The risk management policies
employed by the Company to manage these risks are discussed below.
The primary objectives of the financial risk management function
are to establish risk limits, and then ensure that exposure to risk
stays within these limits. The operational and legal risk
management functions are intended to ensure proper functioning of
internal policies and procedures to minimise operational and legal
risks.
b) Currency risk
Currency risk is not considered to be material to the Company as
majority of bank transactions were incurred in Pounds Sterling
(GBP),
c) Credit risk
Credit risk refers to the risk that a counterparty will default
on its contractual obligations resulting in financial loss to the
Company.
Concentrations of credit risk exist to the extent that the
Company's cash were all held with DBS bank. Per Standard &
Poor's - the Short Term Deposit Rating is A-1+.
Updated
d) Liquidity risk
Liquidity risk is the risk that the Company will encounter
difficulty in meeting the obligations associated with its financial
liabilities. The Company's approach to managing liquidity is to
ensure, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or
risking damage to the Company's reputation.
e) Interest rate risks
The Company has limited exposure to interest rate risk on its
cash positions. Such exposures are managed as efficiently as
possible, given that working capital needs to be maintained. The
effect of a 100 basis points increase/decrease in interest rates
would not have a material impact on pre-tax profits or equity.
7. SEGMENT REPORTING
IFRS 8 defines operating segments as those activities of an
entity about which separate financial information is available and
which are evaluated by the Board of Directors to assess performance
and determine the allocation of resources. The Board of Directors
are of the opinion that under IFRS 8 the Company has only one
operating segment and one geographic market in the UK. The Board of
Directors assess the performance of the operating segment using
financial information which is measured and presented in a manner
consistent with that in the Financial Statements. Segmental
reporting will be reviewed and considered in light of the
development of the Company's business over the next reporting
period.
Honey Financial Services Limited has no activities at present
other than reviewing possible investment opportunities.
8. AUDITORS' REMUNERATION
The following remuneration was received by the Company's
auditors:
Year ended Period ended
31 July 2020 31 July 2019
GBP GBP
Remuneration for the
audit of the Company's
financial statements 37,500 35,000
Non-audit services 2,250 27,300
9. DIRECTORS' EMOLUMENTS
Year Ended Period from
31/07/2020 07/12/2018
to
GBP 31/07/2019
GBP
Key management emoluments
Remuneration 135,700 68,316
---------------- ------------------
The annual remuneration of the key management was as follows, with
no other cash or non-cash benefits.
Year Ended Period from
31/07/2020 07/12/2018
to 31/07/2019
GBP GBP
Executive Directors
Wanbao Xu 50,000 33,333
Yu Xing Liu 15,700 -
Non-executive Directors
Gareth Edwards 35,000 19,435
Shaun Carew-Wootton 35,000 15,548
Included within accruals is GBP58,922, which relates to unpaid
directors' remuneration.
10. TAXATION
The Company is incorporated in the Cayman Islands, and its
activities are subject to taxation at a rate of 0%.
11. LOSS PER SHARE
The Company presents basic and diluted earnings per share
information for its ordinary shares. Basic earnings per share are
calculated by dividing the profit attributable to ordinary
shareholders of the Company by the weighted average number of
ordinary shares in issue during the reporting period. Diluted
earnings per share are determined by adjusting the profit
attributable to ordinary shareholders and the weighted average
number of ordinary shares outstanding for the effects of all
dilutive potential ordinary shares.
There is no difference between the basic and diluted earnings
per share, as the Company has no potential ordinary shares.
Year Ended 31/07/2020 Period Ended
GBP 31/07/2019
GBP
Loss attributable to ordinary shareholders
(GBP) ( 427,385) (678,195)
Weighted average number of shares 24,650,227 12,610,613
--------------------- ------------
Loss per share (expressed as pence per share) (1.7) (5.4)
12. CASH AND CASH EQUIVALENTS
31/07/2020 31/07/2019
GBP GBP
Cash at bank 1,575,076 1,863,098
------------------------------- ----------
Cash at bank earns interest at floating rates based
on daily bank deposit rates.
13. TRADE AND OTHER PAYABLES
31/07/2020 31/07/2019
GBP GBP
Other payables 209,585 46,187
---------------- ----------
14. SHARE CAPITAL
Number Nominal
Value
GBP
Authorised
Ordinary shares of GBP0.01 each 1,000,000,000 10,000,000
Issued and fully paid
On Admission and at 31 July 2019 - GBP0.01
each 24,641,350 246.414
Issue of shares 30,000 300
-------------- -----------
As at 31 July 2020 24,671,350 246,714
============== ===========
The Company was incorporated and registered in The Cayman
Islands as a private company limited by shares on 25 April 2018. On
incorporation, the Company had an authorised share capital of
US$50,000 divided into 50,000 ordinary shares of a par value of
US$1 each. This has been converted to Pounds Sterling (GBP) using
the closing exchange rate GBP/US$ 1.39 on the date of incorporation
on 25 April 2018.
Pursuant to special resolution passed on 29th November 2018, the
Company resolved:
-- to redenominate its share capital from US$ to GBP;
-- to increase its authorised share capital to GBP10,000,000
divided into 1,000,000,000 Ordinary Shares (GBP0.01 each at Par
value);
-- a further 50,000 Ordinary Shares were issued for $50,000, the
proceeds of which were used to buy back the 50,000 shares of US$1
each at Par value in connection with redenomination of share
capital.
As at admission on 7 December 2018, GBP246,414 of Ordinary
Shares in nominal value has been issued and fully paid (divided
into 24,641,350 issued Ordinary Shares of GBP0.01 each at Par
value).
On 15.04.2020, a further 30,000 ordinary shares were issued at
GBP0.15 per share following a warrant being exercised.
All of the issued Ordinary Shares are in registered form and the
Registrar is responsible for maintaining the Company's share
register. There are no restrictions on the distribution of
dividends and the repayment of capital.
The ISIN number of the Ordinary Shares is KYG4598W1024 and SEDOL
number is BGR5JO2.
15. SUBSEQUENT EVENTS
There have been no material events that have occurred since the
year end that require further disclosure.
16. CAPITAL MANAGEMENT
The Company actively manages the capital available to fund the
Company, comprising equity and reserves. The Company's objectives
when maintaining capital is to safeguard the entity's ability to
continue as a going concern, so that it can continue to provide
returns for shareholders.
The capital structure of the Company as at 31 July 2020
consisted of Ordinary Shares and equity attributable to the
shareholders of the Company, totalling GBP1,394,026 (disclosed in
the statement of changes in equity).
The Company reviews the capital structure on an on-going basis.
As part of this review, the directors consider the cost of capital
and the risks associated with each class of capital. The Company
will balance its overall capital structure through the payment of
dividends, new share issues and the issue of new debt or the
repayment of existing debt.
17. RELATED PARTY TRANSACTIONS
The remuneration of the Directors and the key management
personnel of the Company, is set out in note 9.
18. ULTIMATE CONTROLLING PARTY
There is no ultimate controlling party
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END
FR FDDESSESSELF
(END) Dow Jones Newswires
December 01, 2020 02:00 ET (07:00 GMT)
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