New Signature (UK) Limited Company accounts

COMPANY REGISTRATION NUMBER: 04972823

New Signature (UK) Limited

Financial Statements

30 June 2018

New Signature (UK) Limited

Financial Statements

Year ended 30 June 2018

Contents	Page

Directors' report	1

Independent auditor's report to the members	4

Statement of income and retained earnings	7

Statement of financial position	8

Notes to the financial statements	9

New Signature (UK) Limited

Directors' Report

Year ended 30 June 2018

The directors present their report and the financial statements of the company for the year ended 30 June 2018 .

Directors

The directors who served the company during the year were as follows:

M van Klink
J Tench
D Scarfe
P Cosgrave
P Hendy	(Resigned 30 August 2017)
N Hobbs	(Resigned 30 August 2017)
J Siegel	(Resigned 30 August 2017)

Business review

New Signature is a cloud-first, full-service Microsoft partner committed to delivering innovative technology solutions that solve human challenges. Behind every interaction is our dedication to provide outstanding experiences and to build authentic relationships with those around us. We are passionate about driving transformational results for clients across all company sizes, geographies and industries. The New Signature team delivers full lifecycle solutions - from project inception and planning, through deployment to ongoing support and maintenance. New Signature is a recognised expert at the forefront of Microsoft advancements and couples these powerful technologies with exceptional services to empower our customers, colleagues and community.

Good governance is ensured by holding weekly internal meetings of senior management at both local level and international level to discuss the key areas of sales and marketing, delivery and operations, finance and administration and personnel. The Group company holds regular meetings of its board of directors. During the financial year, New Signature UK integrated the people, operations and customer base of Paradigm Systems Limited (a UK based company) and its subsidiary, Paradigm Technologies Pty Ltd (a South African based entity). The acquisition of Paradigm by New Signature's UK parent, Vega Technologies Limited, elevated the existing portfolio of offerings by providing scale and expertise in the delivery of infrastructure and application managed services.

The last financial year was one of very strong revenue growth in the UK aided in part by the acquisition of Paradigm but mostly achieved via organic growth. Top line revenues have increased by 57% to £10.8m, year over year. At the organic level this growth was achieved by the substantial investment the Company has made over the last few years in its business development and solutions teams. Including the ex-Paradigm employees at the end of June we employed 81 permanent staff compared to 72 permanent staff at the same time last year. During the year we recognised revenue across 109 customers which was similar in number to the prior year but of considerably greater value in the 85 new customers we gained. Importantly, we extended our managed service offering to a number of them, thereby greatly enhancing our recurring revenue stream by over 140% year over year.

To finance this growth our parent company continued to make available financial support via a long-term loan, the balance outstanding of which has increased to £3.54m from £3.15m. Further, our net working capital decreased from £261k to (£1.3m) as a result of borrowings made under a replacement Accounts Receivable financing facility orchestrated at Group level with Comerica Bank.

We anticipate further strong growth in the upcoming full year particularly as we look to further develop our current markets, pursue strategic acquisitions, broaden existing capabilities and leverage our joined expertise with our North American and South African team. We are anticipating an improved financial result as our rate of people investment slows somewhat in comparison to what has been seen in the last few years and we now have the resources to scale and drive operational efficiencies.

Directors' responsibilities statement

The directors are responsible for preparing the directors' report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the 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 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 judgments and accounting estimates that are reasonable and prudent.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. 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.

Auditor

Each of the persons who is a director at the date of approval of this report confirms that:

- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.

Small company provisions

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.

This report was approved by the board of directors on 23 January 2019 and signed on behalf of the board by:

M van Klink

Director

Registered office:

Laxmi Building

57 Bermondsey Street

London

SE1 3XJ

New Signature (UK) Limited

Independent Auditor's Report to the Members of New Signature (UK) Limited

Year ended 30 June 2018

Opinion

We have audited the financial statements of New Signature (UK) Limited (the 'company') for the year ended 30 June 2018 which comprise the statement of income and retained earnings, statement of financial position and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the company's members, as a body, in accordance with chapter 3 of part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's 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. In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 30 June 2018 and of its loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.

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 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.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. 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 this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

- the information given in the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

- the directors' report has been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit; or - the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the directors' report and from the requirement to prepare a strategic report.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Thomas McManners ACA Bsc ACMI

(Senior Statutory Auditor)

For and on behalf of

TTCA Ltd

Chartered accountant & statutory auditor

269 Farnborough Road

Farnborough

Hampshire

GU14 7LY

23 January 2019

New Signature (UK) Limited

Statement of Income and Retained Earnings

Year ended 30 June 2018

	2018	2017
Note	£	£
Turnover	10,773,156	6,876,614

Cost of sales	6,742,288	4,187,992
	-------------	------------
Gross profit	4,030,868	2,688,622

Administrative expenses	5,583,263	3,215,441
Other operating income	39,766	49,999
	------------	------------
Operating loss	( 1,512,629)	( 476,820)

Interest payable and similar expenses		252,130	266,644
		------------	------------
Loss before taxation	6	( 1,764,759)	( 743,464)

Tax on loss	( 158,855)	( 57,291)
	------------	---------
Loss for the financial year and total comprehensive income	( 1,605,904)	( 686,173)
	------------	---------

Retained losses at the start of the year	( 2,117,221)	( 1,431,048)
	------------	------------
Retained losses at the end of the year	( 3,723,125)	( 2,117,221)
	------------	------------

All the activities of the company are from continuing operations.

New Signature (UK) Limited

Statement of Financial Position

30 June 2018

	2018	2017
Note	£	£

Fixed assets

Intangible assets	7	1,011,035	698,981
Tangible assets	8	130,920	69,936
		------------	---------
		1,141,955	768,917

Current assets

Stocks		5,000	5,000
Debtors	9	3,693,571	2,581,181
Cash at bank and in hand		47,505	18,918
		------------	------------
		3,746,076	2,605,099

Creditors: amounts falling due within one year	10	5,074,740	2,344,094
		------------	------------
Net current (liabilities)/assets		( 1,328,664)	261,005
		------------	------------
Total assets less current liabilities		( 186,709)	1,029,922

Creditors: amounts falling due after more than one year	11	3,535,416	3,146,143
		------------	------------
Net liabilities		( 3,722,125)	( 2,116,221)
		------------	------------

Capital and reserves

Called up share capital	1,000	1,000
Profit and loss account	( 3,723,125)	( 2,117,221)
	------------	------------
Shareholders deficit	( 3,722,125)	( 2,116,221)
	------------	------------

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies' regime and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.

These financial statements were approved by the board of directors and authorised for issue on 23 January 2019 , and are signed on behalf of the board by:

M van Klink

Director

Company registration number: 04972823

New Signature (UK) Limited

Notes to the Financial Statements

Year ended 30 June 2018

1. General information

The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Laxmi Building, 57 Bermondsey Street, London, SE1 3XJ.

2. Statement of compliance

These financial statements have been prepared in compliance with Section 1A of FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.

3. Accounting policies

Basis of preparation

The financial statements have been prepared on the historical cost basis The financial statements are prepared in sterling, which is the functional currency of the entity.

Going concern

The Business Review in the directors' report on page 1 explains that the company has used long term loan finance from its parent to build an established and highly regarded cloud-based service business. The costs of creating specialist teams and new products and processes have largely been written off in the Profit and Loss Account, leading to a further operating loss in the year. In addition to Parent Company funding, the company has the ability to access funds via a USD$7.5m debt facility financed by the Accounts Receivable positions existing across the trading entities of the Group. The directors have reviewed the company's financial projections for the next 12 months and are satisfied that its existing sources of finance will provide sufficient cash to meet the company's needs. The parent company's major shareholder has confirmed its continuing financial support and its intention to expand our current markets, broaden and deepen existing capabilities and to deliver strong continued growth in the execution of our next financial year plan and beyond. On the basis of their assessment of the company's financial position and the enquiries made of the directors of Vega Technologies Limited, the directors have a reasonable expectation that the company will be able to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

Revenue recognition

The Company recognises revenue in the period in which it was earned. Revenue from consulting services is based on the percentage-of-completion method, which involves calculating the percentage of services provided during the reporting period compared to the total estimated service to be provided over the duration of the contract. This method is followed where reasonably dependable estimates of revenues and costs can be made. Estimates of total contract revenue and costs are continuously monitored during the term of the contract, and recorded revenue and estimated costs are subject to revision as the contract progresses. Such revisions may result in increases or decreases to revenues and income and are reflected in the accounts in the periods in which they are first indentified. If the Company's estimates indicate that a contract loss will occur, a loss provision is recorded in the period in which the loss first becomes probable and reasonably estimable. Contract losses are determined to be the amount by which the estimated total direct and indirect costs of the contract exceed the estimated total revenues that will be generated by the contract and included in cost of services and classified in other accrued liabilities. Revenue recognised in excess of billings are recorded as unbilled services. Billings in excess of revenue recognised are recorded as deferred revenues until revenue recognition criteria are met. Client prepayments (even if nonrefundable) are deferred and recognised over future periods as services are delivered or performed. Non-consulting revenues include the margin earned on computer hardware, software, and related services resale, as well as revenues from alliance agreements. Reimbursements include billings for travel and other out-of-pocket expenses and third-party costs.

Income tax

Tax is recognised in the Income Statement, except that a change 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 reporting date in the countries where the Company operates and generates income.

Foreign currencies

Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.

Goodwill

Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.

Intangible assets

Intangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated amortisation and impairment losses.

Amortisation

Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:

Goodwill	-	5 years
Development costs	-	33% straight line

If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.

Research and development

Research expenditure is written off in the period in which it is incurred. Development expenditure incurred is capitalised as an intangible asset only when all of the following criteria are met: - It is technically feasible to complete the intangible asset so that it will be available for use or sale; - There is the intention to complete the intangible asset and use or sell it; - There is the ability to use or sell the intangible asset; - The use or sale of the intangible asset will generate probable future economic benefits; - There are adequate technical, financial and other resources available to complete the development and to use or sell the intangible asset; and - The expenditure attributable to the intangible asset during its development can be measured reliably. Expenditure that does not meet the above criteria is expensed as incurred.

Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at historical cost less any accumulated depreciation and 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.

Depreciation

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

	Equipment	-	25% straight line

Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.

Stocks

Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.

Financial instruments

A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost.

4. Auditor's remuneration

	2018	2017
	£	£
Fees payable for the audit of the financial statements	6,800	6,600
	-------	-------

5. Employee numbers

The average number of persons employed by the company during the year amounted to 75 (2017: 52 ).

6. Profit before taxation

Loss before taxation is stated after charging:

	2018	2017
	£	£
Amortisation of intangible assets	332,929	44,971
Depreciation of tangible assets	50,402	38,285
Interest payable to group undertakings	217,413	236,978
	---------	---------

7. Intangible assets

	Goodwill	Development costs	Total
	£	£	£
Cost
At 1 July 2017	264,856	479,096	743,952
Additions	–	–	–
Additions from internal developments	–	638,905	638,905
Transfers	–	28,804	28,804
Other movements	( 5,548)	–	( 5,548)
	---------	------------	------------
At 30 June 2018	259,308	1,146,805	1,406,113
	---------	------------	------------
Amortisation
At 1 July 2017	–	44,971	44,971
Charge for the year	51,862	281,067	332,929
Transfers	–	17,178	17,178
	---------	------------	------------
At 30 June 2018	51,862	343,216	395,078
	---------	------------	------------
Carrying amount
At 30 June 2018	207,446	803,589	1,011,035
	---------	------------	------------
At 30 June 2017	264,856	434,125	698,981
	---------	------------	------------

8. Tangible assets

	Equipment
	£
Cost
At 1 July 2017	228,055
Additions	129,794
Disposals	( 18,583)
Transfers	( 28,804)
	---------
At 30 June 2018	310,462
	---------
Depreciation
At 1 July 2017	158,119
Charge for the year	50,402
Disposals	( 11,801)
Transfers	( 17,178)
	---------
At 30 June 2018	179,542
	---------
Carrying amount
At 30 June 2018	130,920
	---------
At 30 June 2017	69,936
	---------

9. Debtors

	2018	2017
	£	£
Trade debtors	2,479,196	1,557,282
Other debtors	1,214,375	1,023,899
	------------	------------
	3,693,571	2,581,181
	------------	------------

10. Creditors: amounts falling due within one year

	2018	2017
	£	£
Bank loans and overdrafts	1,150,000	–
Trade creditors	1,278,697	619,351
Amounts owed to group undertakings and undertakings in which the company has a participating interest	594,540	210,008
Social security and other taxes	557,959	293,864
Invoice discounting facility (secured)	–	480,229
Other creditors	1,493,544	740,642
	------------	------------
	5,074,740	2,344,094
	------------	------------

11. Creditors: amounts falling due after more than one year

	2018	2017
	£	£
Amounts owed to group undertakings and undertakings in which the company has a participating interest	3,535,416	3,146,143
	------------	------------

12. Financial instruments at fair value

	2018	2017
	£	£

Financial assets measured at fair value through profit or loss

Financial assets measured at fair value through profit or loss	47,505	18,918
	--------	--------

Financial liabilities measured at fair value through profit or loss

Financial liabilities measured at fair value through profit or loss	1,150,000	480,229
	------------	---------

13. Controlling party

The company is a subsidiary of Vega Technologies Limited which is the immediate parent company incorporated in the United Kingdom. BSI Platform Holdings LLC, a company incorporated in the USA, was the ultimate parent undertaking of the largest group for which the company was a member and group financial statements were drawn.