TIDMSURE
RNS Number : 0565H
Sure Ventures PLC
30 July 2021
Sure Ventures plc
Annual Report and Audited Financial Statements
For the year ended 31 March 2021
Company Number: 10829500
Table of Contents
1 Investment Objective, Policy and Performance Summary1
2 Chairman's
Statement..........................................................................
3
3 Investment Manager's Report.............................................................. 7
4 Strategic
Report.................................................................................
10
Business Review11
Principal Risks and Uncertainties13
Key Performance Indicators5
Promoting the Success of the Company
5 Directors' Report 7
Board of Directors8
Statutory Information19
Corporate Governance Statement4
Report of the Audit Committee31
Statement of Directors' Responsibilities
Directors' Remuneration Report5
6 Independent Auditors' Report............................................................ 39
7 Financial Statements 6
Income Statement7
Statement of Financial Position8
Statement of Changes in Equity9
Statement of Cash Flows0
Notes to the Financial Statements
8 Alternative Performance Measures (APMs)
9 Glossary
10 Shareholders' Information
Directors, Portfolio Manager and Advisers68
11 Investment Policy
1 Investment Objective, Policy and Performance Summary
Investment Objective
The investment objective of the Company is to achieve capital
growth for investors.
Investment Policy
The Company's Investment Policy can be found at page 68 of this
Annual Report.
Performance Summary
31 March 2021 31 March 2020
Number of ordinary shares in
issue 5,350,725 4,869,956
Market capitalisation
- Ordinary shares (in sterling) 5,618,000 5,120,000
Net asset value ("NAV") attributable
to ordinary shareholders
- Ordinary shares GBP 4,925,764 GBP 4,509,919
NAV per share attributable to
ordinary shareholders
- Ordinary shares (in sterling) 92.06p 92.61p
Ordinary share price (bid price)
in sterling 105.00p 105.13p
Ordinary share price premium
to NAV
in sterling 14.06% 13.52%
Investments held at fair value
through profit and loss GBP 3,724,611 GBP 3,078,560
Cash and cash equivalents GBP 1,255,199 GBP 1,700,601
Dividend History
There were no dividends paid during the period (2020 -
None).
Listing Information
The Company's shares are admitted to trading on the Specialist
Fund Segment (SFS) of the London Stock Exchange.
The ISIN number for the GBP shares is GB00BYWYZ460, Ticker:
SURE.
Website
The Company's website address is http://www.sureventuresplc.com
.
2 Chairman's Statement
Chairman's Statement
Dear Shareholders.
On behalf of my fellow directors, I am delighted to present the
annual results of Sure Ventures plc (the 'Company') for the year
ended 31 March 2021.
FINANCIAL Performance
The Company's performance for the year to 31 March 2021 was
broadly in line with expectations, returning a net asset value
('NAV') total return per share of -0.58% (31 March 2020 +11.54%).
In a year that witnessed a strong recovery in public markets from
the March 2020 COVID-19 crisis sell-off, global private equity and
venture capital activity dropped dramatically in the Spring and
Summer of 2020, to then follow the public markets' positive
recovery into the second half of 2020. Given that the overall
private market deal count remained low in most sectors last year,
it is anticipated that 2021 will be a strong year of pent-up demand
as capital is put to work in the private markets, and particularly
in high-growth technology sectors. Against this backdrop it has
been a year of consolidation for the Company in which the portfolio
has seen some exciting new additions to its seasoned mix of
investee companies, many of which are preparing for their next
funding rounds that are anticipated to generate significant
valuation uplifts into the remainder of the current financial
year.
In the period to 31 March 2021 the Company's NAV attributable to
shareholders grew steadily by GBP425k to GBP4.92m with only a
limited marketing activity being employed by the Investment
Manager.
The Company's share price continues to trade at a healthy
premium to its last published NAV, which the Company believes
supports the continued growth potential of its investments and
demonstrates an understanding among shareholders of the investment
rationale and investment horizon.
Portfolio Update
The Company's holdings comprise its 25.9% investment in Sure
Valley Ventures. This is a Sub-Fund of Suir Valley Fund ICAV (the
'Fund') to which the Company has made a total commitment of EUR7m
(increasing its initial commitment from EUR4.5m in September 2019).
As well as these investments the Company directly holds - Immotion
Group plc ('Immotion'), which is a listed immersive virtual reality
('VR") entertainment group and VividQ Limited, a privately owned
deep technology company pioneering the application of holography in
augmented reality ('AR') and VR. The Fund portfolio includes one
listed entity, VR Education Holdings plc ('VR Education') a
developer of VR software and immersive experiences with a specific
focus on education, and as at the year end, a further twelve
privately held companies in the AR, VR, internet of things ('IoT')
and artificial intelligence ('AI') space, having concluded its
first successful portfolio company exit in the previous financial
year for x5 return of the original investment.
During the year the Fund announced the following additional
investments:
-- Buymie (April 2020), an AI app-based on-demand home grocery
delivery service available in Dublin and Bristol allowing customers
to order groceries from Tesco, Co-op and Asda, and have them
delivered by a personal shopper within as little as an hour
-- Volograms (July 2020), an AR capture and volumetric video
company enabling users to capture volumetric holograms of real
people for use in apps, social media and VR headsets
-- Virtex (January 2021), a VR application that enables eSports
organisers to host their exisiting formats on a 3D entertainment
platform
-- Polience, t/a PreCog (March 2021), an InfoSec company that
has developed a proprietary system to counter terrorism, by
supporting border control agencies to prevent people
trafficking
Each of these investments brings its own unique qualities and
adds to the diverse and well-balanced composition of the Fund's
portfolio of investee companies.
The year also featured a Series A follow-on investment for
Buymie led by a new investor, Wheatcroft Group, the food and
agricultural arm of the Grosvenor Estate. The funding round closed
in June 2020 and provided the Company with a 200% uplift from its
original investment in only three months.
In January 2021 the Company announced a Series A follow-on round
for CameraMatics, the IoT fleet and vehicle safety technology
specialist. Led by Puma Investments, an investment consortium of
original investors including the Fund raised in excess of EUR4m,
representing a fourfold uplift from the original investment made in
November 2017.
Both of the Company's listed investment holdings, Immotion and
VRE Education (held by the Fund) , suffered bouts of volatility
throughout the year with Immotion's share price trading in the 2p
to 6p range, closing at 5p at the year end and VRE trading in the
5p to 23p range, closing at 10p at the year end. Shortly after 31
March 2021, the Company reduced its holding of Immotion shares
whilst retaining a level of exposure equivalent to its initial
investment, thus benefitting from any potential upside from
Immotion's concerted efforts to diversify its revenue streams.
During the financial year the Fund decided to sell sufficient VRE
shares to recoup its initial investment and the strategy for now is
to maintain the current level of holdings given the further
possible momentum from the investment by HTC in VRE.
Further information on the investment portfolio is provided in
the report of the Investment Manager which follows this
statement.
COMMITMENTS AND FUNDING
As previously mentioned, in 2019 the Company announced an
increase in subscription to the Fund of EUR2.5m taking its total
commitment to EUR7m, thereby increasing its share in the Fund from
21.6% to 25.9%. This commitment was made shortly before the Fund
closed to new subscribers validating the Company's belief that the
Fund portfolio is at a mature stage and, with a number of investee
companies preparing for further funding rounds, there is
demonstrable potential for further uplifts to occur from initial
valuations. Several of these funding rounds are currently in the
negotiation stage and the Company expects to announce further
updates in the next one-two quarters.
The Company believes that it will have sufficient access to
funding to meet its commitments to the Fund over the term of the
Fund's investment cycle, through a combination of available cash,
anticipated subscriptions and access to undrawn facilities.
Investment Environment
The Company is impressed by how the Investment Manager has
navigated through a challenging investment environment as it has
steadily grown the investment portfolio with other complimentary
businesses in diverse sectors. Its experienced team has been on
hand to provide advice and guidance to its investee companies and
it is a testament to the Investment Manager's comprehensive
investment filter processes that the performance of the portfolio
has largely been unaffected to the downside by COVID-19, and
certain companies such as Buymie, Admix and Ambisense have
benefitted from accelerated growth as a consequence of the COVID-19
environment. The post-pandemic world will change enormously with
businesses increasingly improving efficiencies with AI and IoT
technology as consumer behaviour experiences a significant change
towards online consumption and the global commercial environment
embraces technological changes at a faster pace than ever
previously envisaged. However, whilst the portfolio has largely
been insulated by the effects of COVID-19, the Company and the
Investment Manger continue to remain vigilant of the risks
associated with the pandemic.
Dividend
During the year to 31 March 2021, the Company has not declared a
dividend (31 March 2020: GBPnil). Pursuant to the Company's
dividend policy the directors intend to manage the Company's
affairs to achieve shareholder returns through capital growth
rather than income. The Company does not expect to receive a
material amount of dividends or other income from its direct or
indirect investments. It should not be expected that the Company
will pay a significant annual dividend, if any.
Gearing
The Company may deploy gearing of up to 20% of net asset value
(calculated at the time of borrowing) to seek to enhance returns
and for the purposes of capital flexibility and efficient portfolio
management. The Company's gearing is expected to primarily comprise
bank borrowings but may include the use of derivative instruments
and such other methods as the Board may determine. During the
period to 31 March 2021 the Company did not employ any borrowing
(31 March 2020: GBPnil).
The Board will continue to review the Company's borrowing, in
conjunction with the Investment Manager on a regular basis pursuant
with the Company's overall cash management and investment
strategy.
CAPITAL RAISING
On 1 April 2020 and 3 July 2020, the Company announced placings
of 250,000 and 230,769 ordinary shares respectively, which were
admitted to trading on the Specialist Fund Segment of the London
Stock Exchange, under the existing ISIN: GB00BYWYZ460, taking the
total shares in admission as at 31 March 2021 to 5,350,725.
Post year end, on 8 June 2021, the Company announced a placing
of 662,500 ordinary shares that were admitted to trading on the
Specialist Fund Segment of the London Stock Exchange on 14 June
2021, under the existing ISIN: GB00BYWYZ460, taking the total
shares in admission as at 14 June 2021 to 6,013,225
The Investment Manager's Report following this Statement gives
further detail on the affairs of the Company. The Board is
confident of the long-term prospects for the Company in pursuit of
its investment objectives.
Outlook
Several portfolio companies are at different stages of further
fundraising rounds and upon completion the Company anticipates
further positive announcements to this effect within the next
one-two quarters.
The portfolio construction of the Fund is expected to be
completed and reach the optimum number of companies within the
current financial year with other potential investment targets
currently undergoing the rigorous due diligence process.
Additionally, the Company continues to explore its robust pipeline
of potential direct investments.
With a now well established, diverse portfolio of exciting,
early-stage, high-growth technology companies, the Company believes
that this next year to eighteen months will be a transformational
period as the efforts of the Investment Manager in assembling this
high-quality portfolio translate into shareholder rewards from
valuation uplifts and, ultimately, future exits at significant
premiums to current valuations.
Perry Wilson
Chairman
29 July 2021
3 Investment Manager's Report
Investment Manager's Report
The company
Sure Ventures plc (the "Company") was established to enable
investors to gain access to early stage technology companies in the
three exciting and expansive market verticals of augmented reality
and virtual reality (AR/VR), artificial intelligence (AI) and the
internet of things (IoT).
The Company gains access to deal flow ordinarily reserved for
venture capital funds and ultra-high net worth angel investors,
establishing a diversified software-centric portfolio with a clear
strategy. Listing the fund on the London Stock Exchange offers
investors:
-- Relative liquidity
-- A quoted share price
-- A high level of corporate governance.
It is often too expensive, too risky and too labour intensive
for investors to build a portfolio of this nature themselves. We
are leveraging the diverse skillsets of an experienced management
team who have the industry network to gain access to quality deal
flow, the expertise to complete extensive due diligence in target
markets and the entrepreneurial skills to help these companies to
mature successfully. Those investing in the Company will get
exposure to Sure Valley Ventures which in turn makes direct
investments in the above sectors in the UK & Ireland.
Augmented Reality & Virtual Reality
The AR/VR market is evolving at a rapid pace. The market is
expected to grow into a US$298 billion industry by 2023 , growing
at a CAGR of over 60% during the forecast time frame [1].
Significant investment in hardware capability and headset
development has been made by major industry players such as
Facebook (through its Oculus division), Microsoft, Sony (through
its PlayStation division), HTC, Samsung and others. This investment
has ignited a new and exciting industry within the technology
sector. Hardware manufacturers and AR/VR users are now searching
for software capabilities/support and content, and we believe that
exposure to this industry via the Fund and direct investment into
software companies in the space will offer significant upside
potential for investors. Through our network of technology
accelerators, angel investor partners and industry contacts in the
AR/VR space, we expect to have a strong chance of discovering the
industry leaders of tomorrow.
Internet of Things
The Internet of Things (IoT) as a segment of the market is a
broad investment area; it is defined as the interconnection, via
the internet, of computing devices embedded in everyday objects,
enabling them to send and receive data. The market was estimated to
be worth US$212 billion dollars by the end of 2019 and is predicted
to reach a size of US$1.6 trillion by 2025[2]. The global growth
and advancement of internet coverage, the increased speed and
capability of connectivity and the mass market penetration of
smartphones/tablet sales has created significant opportunities for
software companies. Businesses from many industries are embracing
the efficiencies, cost savings and the "direct to consumer"
penetration this technological advancement has offered. We see
continued growth in this area and believe that investor returns
will benefit from exposure to the space.
Artificial Intelligence
According to the market research firm Tractica, the global
artificial intelligence software market is expected to experience
massive growth in the coming years, with revenues increasing from
around US$9.5 billion in 2018 to an expected US$118.6 billion by
2025[3]. The overall AI market includes a wide array of
applications such as natural language processing, robotic process
automation, and machine learning. McKinsey did an analysis
comparing the value created by advanced analytics versus AI and
machine learning across common enterprise use cases. McKinsey found
that 82% of enterprises adopting machine learning and AI have
gained a financial return from their investments. For companies
across all industries, the median return on investment from
cognitive technologies is 17%. AI and machine learning have the
potential to create an additional US$2.6T in value by 2020 in
Marketing and Sales, and up to US$2.0T in manufacturing and supply
chain planning.
[[1] ARC market research Sep 2019
[2] Statista 2019
[3] Tractica 2019
PORTFOLIO BREAKDOWN
On 6 February 2018 the Company entered into a EUR4.5m commitment
to Sure Valley Ventures (the "Fund"), the sole sub-fund of Suir
Valley Funds ICAV and its investment was equalised into the Fund at
that date. On 31 August 2019 a further EUR2.5m was committed to the
Fund, taking the total investment in Sure Valley Ventures to EUR7m.
The first drawdown was made on 5 March 2018 and as at 31 March
2021, a total of EUR3,717,320 had been drawn down against this
commitment.
On 26 April 2019 the Company made a direct investment of
GBP500,000 into VividQ Limited, a deep tech start up with world
leading expertise in 3D holography. This investment represents the
second direct investment of the Company, alongside Immotion Group
PLC, which was announced on 24th April 2018. As detailed in the
Statement of Position included in the following financial
statements, these two investments alongside the Fund investment
represent the entire portfolio of Sure Ventures plc as at 31 March
2021.
On 3 July 2020, the Company announced a placing of 230,769
ordinary shares. The ordinary shares were admitted to trading on
the Specialist Fund Segment of the London Stock Exchange on 9 July
2020, under the existing ISIN: GB00BYWYZ460, taking the total
shares in admission as at 31 March 2021 to 5,350,725.
suir valley Funds ICAV
Suir Valley Funds ICAV (the "ICAV") is a close-ended Irish
collective asset-management vehicle with segregated liability
between sub-funds incorporated in Ireland pursuant to the Irish
Collective Asset-management Vehicles Act 2015 and constituted as an
umbrella fund insofar as the share capital of the ICAV is divided
into different series with each series representing a portfolio of
assets comprising a separate sub-fund.
The ICAV was registered on 18 October 2016 and authorised by the
Central Bank of Ireland as a qualifying investor alternative
investment fund ("QIAIF") on 10 January 2017. The initial sub-fund
of the ICAV is Sure Valley Ventures, or the Fund, which had an
initial closing date of 1 March 2017. The Fund invests in a broad
range of software companies with a focus on companies in the AR/VR,
AI and IoT sectors.
As at 31 March 2021 the Fund had commitments totaling EUR27m and
had made fifteen direct investments into companies spanning the
AR/VR, AI and IoT sectors. One of these investments was sold in the
prior year, giving the Fund its first realised gain on exit of
around 5X return on investment. On 12 March 2018, Immersive VR
Education Limited, the Fund's first investment, completed a
flotation on the London Stock Exchange (AIM) and the Dublin Stock
Exchange (ESM). The public company is now called VR Education
Holdings PLC - ticker VRE. VRE was the first software company to
list on the ESM since that market's inception. In July 2020,
following an improvement in share price, the sub-Fund decided to
sell sufficient shares to recover its initial investment. This
resulted in a realised gain of EUR73k being payable to Sure
Ventures PLC, along with its share of the initial investment, and
some Escrow Funds from the aforementioned exit. Total capital
distributions from the sub-Fund to the PLC for the year ended March
2021 was EUR166k.
performance
In the year to 31 March 2021 the Company's performance was
broadly in line with expectations, returning a net asset value of
GBP0.92 per unit, which is materially unchanged from the 31 March
2020 audited year end figure. The NAV has been helped by the share
price improvement of Immotion Group PLC, closing the year at 5.05p
(2020: 1.85p) which has recovered from the initial impact of the
Covid-19 pandemic. The share price has continued to improve since
year end and is now trading around 6p. Given the lack of revenue to
support the ongoing operational costs of the PLC, these unrealised
gains are key to maintaining a steady NAV, until the point that we
see more exits and realised gains.
FutuRe Investment OUTLOOK
The Fund has achieved one very positive realised gain, recovered
its full investment in its listed portfolio company, as well as
seeing a number of unrealised gains across the portfolio. The Fund
continues to have access to quality deals in our chosen high growth
sectors. The portfolio of current investments is continuing to
mature and approaching series A funding rounds, which if
successful, will begin to provide the NAV growth that was set out
to achieve from inception.
We remain confident in the future outlook of the Company in the
forthcoming financial year and in line with the prospectus, reserve
the right to make further direct investments provided there is
sufficient working capital to do so.
Shard Capital AIFM LLP
Investment Manager
2 June 2021
4 Strategic Report
Business Review
The strategic report on pages 10 to 16 has been prepared to help
shareholders assess how the Company operates and how it has
performed. The strategic report has been prepared in accordance
with the requirements of Section 414 A-D of the Companies Act 2006
(the "Act") and best practice. The business review section of the
strategic report discloses the Company's risks and uncertainties as
identified by the board, the key performance indicators used by the
board to measure the Company's performance, the strategies used to
implement the Company's objectives, the Company's environmental,
social and ethical policy and the Company's future
developments.
PrincipaL activity
The Company carries on business as an investment trust and its
principal activity is to invest in companies in accordance with the
Company's investment policy with a view to achieving its investment
objective.
Strategic and investment policy
Investment Policy
The Company's Investment Policy can be found at page 68 of this
Annual Report.
Future developments
While the future performance of the Company is dependent, to a
large degree, on the performance of the Fund which, in turn, is
subject to many external factors, the board's intention is that the
Company will continue to pursue its stated investment objective as
outlined on page 2. The Company's future developments and outlook
are discussed in more detail in the Chairman's Statement on page 4
and the Investment Manager's Report on page 7 - 9.
Premium/Discount management
The board closely monitors the premium or discount at which the
Company's ordinary shares trade in relation to the Company's
underlying net asset value and takes action accordingly. Throughout
the period under review the Company's ordinary shares traded at a
premium or discount to its underlying net asset value. The board is
of the view that an increase of the Company's ordinary shares in
issue provides benefits to shareholders, including a reduction in
the Company's administrative expenses on a per share basis and
increased liquidity in the Company's shares.
The board believes that it is in shareholders' best interests to
prevent the Company's shares trading at a discount to net asset
value because shareholders will be unable to realise the full value
of their investments.
Corporate and operational structure
Operational and portfolio management
The Company has outsourced its operations and portfolio
management to various service providers as detailed below:
-- Shard Capital AIFM LLP is appointed as the Company's manager
(the "Manager") and Alternative Investment Fund Manager ("AIFM")
for the purposes of the Alternative Investment Fund Managers
Directive ("AIFMD");
-- Apex Fund Services (Ireland) Limited is appointed to act as the Company's administrator;
-- Effective from 1 January 2021, Throgmorton Secretaries LLP is
appointed as the Company's secretary. Up to 31 December 2020, Apex
Fund Services (Ireland) Limited was Company secretary of the
Company;
-- Indos Financial Limited is appointed as the Company's depositary;
-- Computershare Investor Services plc is appointed as the Company's share registrar;
-- Shard Capital Partners LLP is appointed to act as the Company's placing agent; and
-- PKF Littlejohn LLP is appointed to act as the Company's auditors.
Alternative Investment Fund Managers Directive
In accordance with the AIFMD, the Company has appointed Shard
Capital AIFM LLP to act as the Company's AIFM for the purposes of
the AIFMD. The AIFM ensures that the Company's assets are valued
appropriately in accordance with the relevant regulations and
guidance. In addition, the Company has appointed Indos Financial
Limited as depositary, to provide depositary services to the
Company as required by the AIFMD.
Donations
The Company made no political or charitable donations during the
period under review to organisations either within or outside the
EU (2020 - none).
Environment, human rights, employee, social and community
issues
The Company is required by law to provide details of
environmental matters (including impact of the Company's business
on the environment), employee, human rights, social and community
issues (including information about any policies it has in relation
to these matters and the effectiveness of those policies). The
Company does not have any employees and the board comprises
non-executive directors. As an investment trust, its activities do
not have a direct impact on the environment. The Company aims to
minimise any detrimental effect that its actions may have by
adhering to applicable social legislation, and as a result does not
maintain specific policies in relation to these matters.
The Company has no operations and therefore no greenhouse gas
emissions to report nor does it have responsibility for any other
emissions producing sources under the Companies Act 2006 (Strategic
Report and Directors Reports) Regulations 2013, including those
within its underlying investment portfolio. However, the Company
believes that high standards of corporate social responsibility
such as the recycling of paper waste will support its strategy and
make good business sense.
In carrying out its investment activities and in relationships
with suppliers, the Company aims to conduct itself responsibly,
ethically and fairly.
Modern slavery
Due to the nature of the Company's business, the board does not
consider the Company to be directly within the scope of modern
slavery regulations. The board considers the Company's supply
chains, being with professional service providers within the UK or
the EU to be low risk in relation to this matter.
Anti-bribery and corruption
It is the Company's policy to conduct its business in an ethical
manner. The Company takes a zero tolerance approach to bribery and
corruption and is committed to acting professionally, fairly and
with integrity in its business dealings.
Principal Risks and Uncertainties
The board has carried out a robust assessment of its risks and
controls as detailed below. The day-to-day risk management
functions of the Company have been delegated to Shard Capital AIFM
LLP, which reports to the board.
OperationaL Risks
Third Party Service Providers
The Company has no employees and the directors have all been
appointed on a non-executive basis. Whilst the Company has taken
all reasonable steps to establish and maintain adequate procedures,
systems and controls to enable it to comply with its obligations,
the Company is reliant upon the performance of third-party service
providers for its executive function. In particular, the manager,
depositary, administrator and registrar amongst others, will be
performing services which are integral to the day-to-day operation,
including IT, of the Company.
The termination of service provision by any service provider, or
failure by any service provider to carry out its obligations to the
Company, or to carry out its obligations to the Company in
accordance with the terms of its appointment, could have a material
adverse effect on the Company's operations and its ability to meet
its investment objective.
Mitigation
Day-to-day oversight of third-party service providers is
exercised by the Manager and reported to the board on a quarterly
basis. As appropriate to the function being undertaken, each of the
service providers is subject to regular performance and compliance
monitoring. The performance of Shard Capital AIFM LLP (the
'Manager') in its duties to the Company is subject to ongoing
review by the board on a quarterly basis as well as formal annual
review by the Company's management engagement committee.
The appointment of each service provider is governed by
agreements which contain the ability to terminate each of these
counterparties with limited notice should they continually or
materially breach any of their obligations to the Company.
Reliance on key individuals
The Company will rely on key individuals at the Manager to
identify and select investment opportunities and to manage the
day-to-day affairs of the Company. There can be no assurance as to
the continued service of these key individuals at the Manager. The
departure of key individuals from the Manager without adequate
replacement may have a material adverse effect on the Company's
business prospects and results of operations. Accordingly, the
ability of the Company to achieve its investment objective depends
heavily on the experience of the Manager's team, and more generally
on the ability of the Manager to attract and retain suitable
staff.
Mitigation
The interests of the Manager are closely aligned with the
performance of the Company through the management and performance
fee structures in place and direct investment by certain key
individuals of the Manager. Furthermore, investment decisions are
made by a team of professionals, mitigating the impact loss of any
single key professional within the Manager's organisation. The
performance of the Manager in its duties to the Company is subject
to ongoing review by the board as well as formal annual review by
the management engagement committee.
Fluctuations in the market price of Issue Shares
The market price of the issued shares may fluctuate widely in
response to different factors and there can be no assurance that
the issued shares will be repurchased by the Company even if they
trade materially below their net asset value. Similarly, the shares
may trade at a premium to net asset value whereby the shares can
trade on the open market at a price that is higher than the value
of the underlying assets. There can be no assurance, express or
implied, that shareholders will receive back the amount of their
investment in the issued shares.
Mitigation
The Manager and the board closely monitor the level of discount
or premium at which the shares trade on the open market. Subject to
Shareholders' approval, the Company may purchase the shares in the
market with the intention of enhancing the net asset value per
ordinary share, however there can be no assurance that any
purchases will take place or that any purchases will have the
effect of narrowing any discount to net asset value at which the
ordinary shares may trade. When the shares trade at a premium the
Company may issue shares to reduce the premium at which shares
trade. As at 31 March 2021 the shares were trading at a premium to
net asset value.
Investments
Achievement of the Investment Objective
There can be no assurance that the Manager will continue to be
successful in implementing the Company's investment objective.
Mitigation
The Company's investment decisions are delegated to the Manager.
Performance of the Company against its investment objectives is
closely monitored on an ongoing basis by the Manager and the board
and is reviewed in detail at each board meeting. Any action
required to mitigate underperformance is taken as deemed
appropriate by the Manager.
Borrowing
The Company may use borrowings in connection with its investment
activities including, where the Manager believes that it is in the
interests of shareholders to do so, for the purposes of seeking to
enhance investment returns. Such borrowings may subject the Company
to interest rate risk and additional losses if the value of its
investments falls. Whilst the use of borrowings should enhance the
net asset value of the issued shares when the value of the
Company's underlying assets is rising, it will have the opposite
effect where the underlying asset value is falling. In addition, in
the event that the Company's income falls for whatever reason, the
use of borrowings will increase the impact of such a fall on the
Company's return and accordingly will have an adverse effect on the
Company's ability to pay dividends to shareholders.
Mitigation
The Manager and the board closely monitor the level of gearing
of the Company. The Company has a maximum limitation on borrowings
of 20% of net asset value (calculated at the time of borrowing)
which the Manager may affect at its discretion. As at the date of
this report, the Company had no current borrowings outstanding.
Liquidity of Investments
The Company expects to have a material level of exposure to
unquoted companies that are aligned with the Company's strategy and
that present opportunities to enhance the Company's return on its
investments. Such investments, by their nature, involve a higher
degree of valuation and performance uncertainties and liquidity
risks than investments in listed and quoted securities and they may
be more difficult to realise. The illiquidity of such investments
may make it difficult for the Company to sell them if the need
arises and may result in the Company realising significantly less
than the value at which it had previously recorded such
investments. Investments in unlisted equity securities, by their
nature, involve a higher degree of valuation and performance
uncertainties and liquidity risks than investments in listed
securities and therefore may be more difficult to realise.
Mitigation
The Company has established investment restrictions on the
extent to which it can invest up to 15% of net asset value in a
single investment. However, this restriction does not apply to
investments in the Fund or any Further Funds or collective
investment vehicles managed by third parties. Compliance with these
restrictions is monitored by the Manager and by the board on an
ongoing basis.
Regulations
Tax
Any changes in the Company's tax status or in taxation
legislation could affect the value of investments held by the
Company, affect the Company's ability to provide returns to
shareholders and affect the tax treatment for shareholders of their
investments in the Company.
Mitigation
The Company intends at all times to conduct its affairs so as to
enable it to qualify as an investment trust for the purposes of
Chapter 4 of Part 24 of the Corporation Tax Act 2010. Both the
board and the Manager are aware of the requirements which are to be
fulfilled in any accounting period for the Company to maintain its
investment trust status. Adherence to the conditions required to
satisfy the investment trust criteria are monitored by the
compliance function of the Manager and reviewed by the board on a
regular basis.
Breach of applicable legislative obligations
The Company and its third-party service providers are subject to
various legislation and regulations, including, but not limited to
the Data Protection Act 2018 and the General Data Protection
Regulation. Any breach of applicable legislative obligations could
have a negative impact on the Company and impact returns to
shareholders.
Mitigation
The Company engages only with third party service providers
which hold the appropriate regulatory approvals for the function
they are to perform, and can demonstrate that they can adhere to
the regulatory standards required of them. Each appointment is
governed by agreements which contain the ability to terminate each
of these counterparties with limited notice should they continually
or materially breach any of their legislative obligations, or their
obligations to the Company more broadly. Additionally, each of the
counterparties is subject to regular performance and compliance
monitoring by the Manager, as appropriate to their function, to
ensure that they are acting in accordance with applicable
regulations and are aware of any upcoming regulatory changes which
may affect the Company. Performance of third party service
providers is reported to the board on a quarterly basis, whilst the
performance of the Manager in its duties to the Company is subject
to ongoing review by the board on a quarterly basis as well as
formal annual review by the management engagement committee.
Key Performance Indicators
The board monitors success in implementing the Company's
strategy against a range of key performance indicators ("KPIs"),
which are viewed as significant measures of success over the longer
term. Although performance relative to the KPIs is also monitored
over shorter periods, it is success over the long term that is
viewed as more important, given the inherent volatility of
short-term investment returns. The principal KPIs are set out
below:
KPI Performance
Year ended 31 Year ended 31
March 2021 March 2020
-------------------- --------------------
Movement in net asset value Decreased by Increased by
per ordinary share 0.58% 11.54%
-------------------- --------------------
Premium/discount (after deducting Traded at a premium Traded at a premium
borrowings at fair value) of 14.05% at of 13.52% at
the year end the year end
-------------------- --------------------
Movement in the share price Decreased by Decreased by
0.12% 0.41%
-------------------- --------------------
The Company does not currently follow any benchmark. Similarly,
Sure Valley Ventures does not follow any benchmark. Accordingly,
the portfolio of investments held by the Company and Sure Valley
Ventures will not mirror the stocks and weightings that constitute
any particular index or indices, which may lead to the Company's
shares failing to follow either the direction or extent of any
moves in the financial markets generally (which may or may not be
to the advantage of shareholders).
Promoting the success of the Company
Under Section 172 of the Companies Act 2006, the board has a
duty to promote the long-term success of the Company for the
benefit of its shareholders as a whole and, in doing so, have
regard to the likely consequences of its decisions in the long-term
upon the Company's other stakeholders and the environment.
The Company's objective is to achieve capital growth for
investors through exposure to early stage technology companies,
with a focus on software-centric businesses in its chosen target
markets.
The board believes that the values of integrity, accountability
and transparency form the basis of the Company's corporate culture
and promote good standards of governance.
The board has identified the Company's main stakeholders to be
its shareholders, investment manager and other key service
providers. The board seeks to understand the priorities of its
stakeholders and engages with them through the communication and
governance processes that it has put in place.
Shareholders
The board believes that transparent communication with
shareholders is important. In addition to the Annual Report and the
Half-yearly Report, the Company publishes quarterly portfolio
updates which are available on the Company's website together with
other information that the board believes shareholders will find
useful. The board welcomes feedback from shareholders and the
Investment Manager provides such feedback to the board on a regular
basis.
During the year, the Company issued 480,769 new ordinary shares
in response to investor demand. The board believes that share
issues are in the interests of shareholders as a whole as they
provide additional finance for investment opportunities, enable the
Company's fixed costs to be spread over a wider base and provide a
source of liquidity in the Company's shares.
Investment Manager
The Investment Manager has a fundamental role in promoting the
long-term success of the company. The board regularly reviews the
performance of the investment portfolio at quarterly board meetings
and performs a formal annual evaluation of the performance of the
Investment Manager. This contact enables constructive regular
dialogue between the Investment Manager and the board.
Other key service providers
The board believes that strong relationships with its other key
service providers (Company Secretary, Administrator, Depositary and
Registrar) are also important for the long-term success of the
Company. There is regular contact between the board and the
Company's other key service providers. The board performs an annual
review of the services provided by the Company Secretary,
Administrator, Depositary and Registrar to ensure that these are in
line with the Company's requirements.
Environmental, Social and Governance ("ESG")
The board and the Investment Manager recognise the importance of
the impact of the Company's decisions and ESG factors are
integrated in the investment process.
Approval
The Strategic Report was approved by the board of directors on
29 July 2021 and signed on its behalf by:
Perry Wilson
Chairman
5 Directors' Report
Bo a rd of Directors
Perry Wilson
Chairman of the board and the management engagement committee
and a member of the audit committee
Perry Wilson (Chairman) (independent)
Perry Wilson is a financial services professional with over 25
years' experience in investment banking and fund management,
responsible for running portfolio risk positions in global markets.
He started his career in accountancy before joining the asset
trading group at Lazard in 1987, focusing on illiquid credit and
structured products and going on to become a director of the
bank.
In 2003 Mr Wilson joined Argo Capital as executive director, an
AIM listed alternative investment fund management firm and was part
of a small team of portfolio managers that oversaw the group's
fiftyfold AUM growth to US$1.3bn at it's height. After leaving Argo
in 2010 Mr Wilson joined Integra Capital to implement a liquid
credit strategy before setting up a fixed income sales and trading
operation for a Central Asian investment bank, Visor Capital in
2013.
Since 2015 Mr Wilson has been on the board of a number of UK and
offshore financial services firms and investment funds, as
independent non-executive director, and also acts as chair of
trustees for a UK pension plan, providing corporate governance and
oversight utilising his extensive financial markets background and
experience.
St John Agnew
St John Agnew
St.John trained as a solicitor and was an in-house Commercial
and Banking Counsel for TSB Bank. His responsibilities included
drafting and negotiating legal documentation in relation to all
Bank lending and commercial arrangements. This included many types
of commercial contracts and involved a close working relationship
with the technology team who required advice on a steady flow of
technology contracts.
He became an Investment Manager in 2000 and set up a fund in the
Cayman Islands in 2004 based on Technical Analysis which he
successfully operated and closed in late 2007. He continues to
advise on investment and is currently an Investment Manager
registered with Credo Capital with his own private clients.
St.John has also served as Trustee on a Pension fund for a
Charity and, using his legal and investment knowledge, he helped to
restructure the Board to allow it to recognise and meet its
extensive ongoing Pension obligations. He is also currently a
Non-Executive Director of a food company, The Big Prawn Company,
where he uses his knowledge and experience to help guide this
company.
gareth burchell
Gareth Burchell
Gareth Burchell began his career in the insurance industry and
spent three years at RBS Insurance prior to beginning his career in
investment advice and management. Mr. Burchell is currently Head of
Shard Capital Stockbrokers and chairs an investment committee that
specialises in providing funding for both listed and unlisted small
companies. Mr Burchell has had a focus on the small cap arena for
15 years and he and his team have provided GBP90 million of funding
across 221 companies. He has an in-depth knowledge of the UK
listing process of various small cap exchanges.
Statutory information
Board members, and directors' and officers' insurance
The names and biographical details of the board members who
served on the board as at the year end can be found on page 18.
During the year under review the Company's directors' and
officers' liability insurance for its directors and officers as
permitted by section 233 of the Companies Act 2006 were covered and
maintained by Shard Capital AIFM LLP.
Status of the Company
The Company is an investment company within the meaning of
section 833 of the Companies Act 2006.
The Company operates as an investment trust in accordance with
Chapter 4 of Part 24 of the Corporation Tax Act 2010 and the
Investment Trust (Approved Company) (Tax) Regulations 2011. The
Company has obtained its initial approval as an investment trust
from HM Revenue & Customs. In the opinion of the directors, the
Company has conducted its affairs since its initial approval as an
investment trust so that it is able to maintain its status as an
investment trust.
The Company is an externally managed closed-ended investment
company with an unlimited life and has no employees.
Internal controls and risk management
Details of the Company's principal risks and uncertainties can
be found in the Strategic Report on pages 13 to 15 inclusive of
details of the Company's internal controls. Details of the
Company's application of hedging arrangements are set out on page
70, the Investment Policy section of these financial
statements.
Share capital - voting and dividend
As at 31 March 2021, the Company had 5,350,725 (2020: 4,869,956)
ordinary shares in issue. There are no other classes of shares in
issue and no shares are held in treasury.
At the Company's last Annual General Meeting held on 24
September 2020, the board was granted authorities to issue up to
48,000,000 ordinary shares of 0.01 each in the capital of the
Company and the right to subscribe for or to convert any security
into ordinary shares for any purpose, up to an aggregate nominal
amount of up to 98.56% of current shares in issue, such authority
to apply until the end of next year's Annual General Meeting (or,
if earlier, until the close of business on 30 September 2021).
The maximum number of shares which can be admitted to trading on
the LSE without the publication of a prospectus is 20% of the
ordinary shares in issue on a rolling 12 month basis at the time of
admission of the shares.
The price of any Ordinary Shares issued to Shard Capital Limited
("SCL") under the SCL Agreement will be not less than the NAV per
Ordinary Share at the time of issue plus a premium to cover the
expenses of such issue.
During the year under review a total of 480,769 (2020: 305,208)
ordinary shares were issued as detailed below:
Shares issued Price paid per Premium to
share (pence) net asset value
(%) (1)
============== ===============
1 April 2020 250,000 100.00 7.98%
============== ============== =============== =================
1 July 2020 230,769 97.50 -1.42%
============== ============== =============== =================
(1) Last published NAV at time of issue
As at 31 March 2021 there were 5,350,725 ordinary shares of 1p
in issue. Since the year end a further 662,500 ordinary shares have
been issued.
The ordinary shares carry the right to receive dividends and
have one voting right per ordinary share. There are no shares which
carry specific rights with regard to the control of the Company.
The shares are freely transferable. There are no restrictions or
agreements between shareholders on the voting rights of any of the
ordinary shares or the transfer of shares.
The Company has been incorporated with an unlimited life.
On a winding up or a return of capital by the Company, the
ordinary shareholders are entitled to the capital of the
Company.
No final dividend is being recommended. The Company's policy is
to pay dividends, if any, on an annual basis, as set out in the
Company's prospectus dated 17 November 2017 and the supplementary
prospectus dated 2 January 2018 (the "Prospectus"). There were no
dividends paid in respect of the year ended 31 March 2021 (2020 -
None).
The Company will pay out such dividends as are required for it
to maintain its investment trust status.
Substantial share interests
The Company has received the following notification in
accordance with the Disclosure and Transparency Rule 5.1.2R of an
interest in the voting rights attaching to the Company's issued
share capital.
The Company received a notification on 8 March 2021 that Pires
Investments plc had acquired an interest in 1,500,000 ordinary
shares in the Company, representing 28.0% of the Company's ordinary
shares in issue at 31 March 2021.
Independent auditor
The Company's independent auditor, PKF Littlejohn LLP ("PKF"),
was appointed in the prior year and has expressed its willingness
to continue to act as the Company's auditor for the forthcoming
financial year. The audit committee has carefully considered the
auditor's appointment, as required in accordance with its terms of
reference, and, having regard to its effectiveness and the services
it has provided the Company during the period under review, has
recommended to the board that the independent auditor be appointed
at the forthcoming AGM. At the AGM resolutions will be proposed for
the appointment of the independent auditor and to authorise the
directors to agree its remuneration for the forthcoming financial
year. In reaching its decision, the audit committee considered the
points detailed on pages 31 to 33 of the Audit Committee's
report.
Audit information
As r equi r e d b y section 4 1 8 o f t h e C om p ani e s A c t
2 0 06, t h e directors wh o he l d offi ce a t t h e d a te o f t
hi s repor t each confir m that , s o far as the y are awar e ,
there is no rele vant aud i t information o f w hich the C om p an
y 's au d itor is un aware a n d e ac h director ha s t a k e n al
l t h e s t ep s r e qui r e d o f a director to ma k e t h e m s
elve s a w a r e o f a n y r e l ev a n t a u d i t i n f o r m a t
io n a n d t o e s t ablish tha t t h e C om p an y ' s audi t o r
is awa re of that info r ma t ion.
Articles of Association
An y amendmen t s to t h e C om p an y ' s ar t icle s of a s so
cia t io n mus t b e mad e b y spe cia l r e s ol u t ion.
brexit
The broader impacts of Brexit may have an effect on the
financial statements and operations in the future, though it is not
possible to quantify likely impacts at this stage, any effects will
be reflected in the Company's underlying investments future price
movements. The board and all relevant parties continue to monitor
the implications for the Company and implement certain internal
controls to mitigate any risks that may arise in the future.
COVID-19 Pandemic
There has been a global outbreak of a coronavirus disease 2019
(COVID-19), which the World Health Organization has declared a
"Public Health Emergency of International Concern". The impact of
COVID-19 may adversely affect the Company's investments, given that
the Company's operations and profitability could be negatively
impacted by the regional and global outbreak of COVID-19. The
extent of the impact to the financial performance of the Company
will depend on future developments, which are highly uncertain and
cannot be predicted, including new information which may emerge
concerning the severity of COVID-19 and actions taken to contain
COVID-19 or its impact.
The announcement of vaccines of 95% efficacy to combat COVID-19
rebounded the market. The world leaders are executing necessary
procedures to vaccinate their citizens in an attempt to overcome
the coronavirus.
Going concern
The directors have reviewed the financial projections of the
Company from the date of this report, which shows that the Company
will be able to generate sufficient cash flows in order to meet its
liabilities as they fall due. Accordingly, the directors are
satisfied that the going concern basis remains appropriate for the
preparation of the financial statements. The Company also has
detailed policies and processes for managing the risks, set out in
the Investment Policy on pages 68 to 69.
Viability statement
In accordance with the revised Association of Investment
Companies Code of Corporate Governance published in February 2020
and revised UK Corporate Governance Code, published by the
Financial Reporting Council in July 2018, the directors have
assessed the prospects of the Company over a three-year period
ending March 2023. The board believes this period to be appropriate
taking into account the current trading position and the potential
impact of the principal risks that could affect the viability of
the Company. At 31 March 2021, the Company had cash balances of
GBP1,201,153 (2020: GBP1,412,739) in excess of all liabilities.
There are therefore limited risks to the viability of the
Company.
Analysis to assess viability has focused on the risks in
delivery of the growth of the business and a series of projections
have been considered changing funding levels and the performance of
the assets acquired.
The analysis demonstrates that, the Company would be able to
withstand the impact of the risks identified. Based on the robust
assessment of the principal risks, prospects and viability of the
Company, the board confirms that they have reasonable expectation
that the Company will be able to continue in operation and meet its
liabilities as they fall due over the three-year period ending
March 2023.
Management and administration
Company Secretary
Effective from 1 January 2021, Throgmorton Secretaries LLP (the
"Company Secretary") is the company secretary of the Company. Up to
31 December 2020, Apex Fund Services (Ireland) Ltd (the "Company
Secretary") was the company secretary of the company.
Administrator
Apex Fund Services (Ireland) Ltd (the 'Administrator'), is the
administrator of the Company. The Administrator provides the
day-to-day administration of the Company. The Administrator is also
responsible for the Company's general administrative functions,
such as the calculation of the net asset value and maintenance of
the Company's accounting records.
Under the terms of the administration agreement, the
Administrator is entitled to an annual administration fee equal to
the greater of: (i) EUR28,000 per annum; and (ii) an amount equal
to 0.08% of the portion of NAV up to and including EUR100 million,
0.06% of the portion of NAV between EUR100 million and EUR200
million and 0.05% of the portion of NAV above EUR200 million
(exclusive of VAT and out of pocket expenses). The Administrator is
also entitled to reimbursement of all reasonable out of pocket
expenses incurred by it in connection with the performance of its
duties. The administration agreement can be terminated by either
party by providing 90 days' written notice.
Manager
Shard Capital AIFM LLP (the 'Manager'), a UK-based company
authorised and regulated by the Financial Conduct Authority, is the
Company's manager and alternative investment fund manager ("AIFM")
for the purposes of the Alternative Investment Fund Managers
Directive ("AIFMD"). The Manager is responsible for the
discretionary management of the Company's assets and ensures that
these are valued appropriately in accordance with the relevant
regulations and guidance.
Under the terms of the management agreement, the Manager is
entitled to a management fee and a performance fee together with
reimbursement of reasonable expenses incurred by it in the
performance of its duties. From the period from first admission,
the management fee payable was based on 1.25% of the net asset
value. The Manager is also entitled to receive a performance fee
equal to 15% of any excess returns over a high watermark, subject
to achieving a hurdle rate of 8% in respect of each performance
period. Further details on the management fee and the performance
fee can be found in Note 4 to the financial statements. The
management agreement can be terminated by either party providing
twelve months' written notice.
Depositary
The Company's depositary is Indos Financial Limited (the
"Depositary"), a company authorised and regulated by the Financial
Conduct Authority. Under the terms of the depositary services
agreement the Depositary is entitled to a monthly depositary fee
equal to the greater of: (i) GBP2,000 and GBP2,917 per month
(depending on the activity of the Company); and (ii) an amount
equal to 1/12 of 0.03% of NAV (exclusive of VAT and out of pocket
expenses). The depositary services agreement can be terminated by
either party by providing 90 days' written notice.
Change of control
There are no agreements which the Company is party to that might
be affected by a change of control of the Company.
Subsequent events
There have been no other subsequent events for the year ended 31
March 2021.
Future developments
Indications of likely future developments in the business of the
Company are set out in the Strategic Report on pages 10-16.
regulatory disclosures
The disclosures below are made in compliance with the
requirements of Listing Rule 9.8.4.
Listing Rule
9.8.4 (1) - capitalised The Company has not capitalised any interest
interest in the year under review.
======================== ====================================================
9.8.4(2) - unaudited The Company has not published any unaudited
financial information financial information in either a class 1 circular
or a prospectus or in respect of any profit
forecast or profit estimate in accordance with
listing rule 9.2.18.
======================== ====================================================
9.8.4 (3) - deleted This provision has been deleted.
======================== ====================================================
9.8.4 (4) - incentive The Company has no long-term incentive schemes
schemes in operation.
======================== ====================================================
9.8.4 (5) and (6) No director of the Company has waived or agreed
- waiver to waive any current or future emoluments from
the Company.
======================== ====================================================
9.8.4 (7), (8) and During the year under review, the Company issued
(9) a total of 480,769 (2020: 305,208) ordinary
shares with a nominal value of GBP0.01 and
an average price of 98.75 pence per share for
a total consideration of GBP475,000 (2020:
GBP293,000) excluding commission and issue
costs. Further details can be found on page
47.
======================== ====================================================
9.8.4 (8) and 9.8.4 The Company is not part of a group of companies.
(9) - relate to These Listing Rules therefore, do not apply.
companies that are
part of a group
of companies
======================== ====================================================
9.8.4 (10) - contract During the year under review, there were no
of significance contracts of significance subsisting to which
the Company is a party and in which a director
of the Company is or was materially interested
or between the Company and a controlling shareholder.
9.8.4 (11) The Company is not party to any contracts for
the provision of services to the Company by
a controlling shareholder.
====================== =======================================================
9.8.4 (12) and (13) During the year under review, there were no
- arrangements under which a shareholder has
waiving dividends waived or agreed to waive any dividends or
future dividends.
====================== =======================================================
9.8.4 (14) As set out in the prospectus dated 17 November
2017, the Company has not voluntarily adopted
Listing Rule 9.8.4(14).
====================== =======================================================
By order of the board
Throgmorton Secretaries LLP
Company Secretary
Date: 29 July 2021
Corporate governance statement
The corporate governance statement explains how the board has
sought to protect shareholders' interests by protecting and
enhancing shareholder value. The directors are ultimately
responsible for the stewardship of the Company and this section
explains how they have fulfilled their corporate governance
responsibilities. This corporate governance statement forms part of
the directors' report.
As set out in the Prospectus, the Company has adopted certain
key provisions of the UK Listing Rules in accordance with the
London Stock Exchange (LSE) listings. Pursuant to the Listing Rules
as voluntarily adopted by the Company, companies must "comply or
explain" against each of the provisions of the UK Corporate
Governance Code (the "UK Code") published by the Financial
Reporting Council ("FRC"). The board is committed to high standards
of corporate governance. The Listing Rules and the Disclosure
Guidance and Transparency Rules ("DTR") require companies to
disclose how they have applied the principles and provisions of the
UK Code. A copy of the UK Code is available from the website of the
Financial Reporting Council at
https://www.frc.org.uk/directors/corporate-governance-and-stewardship/uk-corporate-governance-code
.
The Association of Investment Companies ("AIC") has published
its own Code on Corporate Governance (the "AIC Code"). The FRC has
confirmed that AIC member companies who report against the AIC Code
will be meeting their obligations in relation to the UK Code and
the associated disclosure requirements of the DTR. The AIC Code is
available from the AIC's website at www.theaic.co.uk.
The board has considered the principles and provisions of the
AIC Code. The AIC Code addresses the principles and provisions set
out in the UK Code, as well as setting out additional principles
and provisions on issues that are of specific relevance to the
Company.
The board considers that voluntarily reporting against the
principles and provisions of the AIC Code, which has been endorsed
by the Financial Reporting Council, provides more relevant
information to shareholders.
Statement of compliance
The Company has complied with the recommendations of the AIC
Code and the relevant provisions of the UK Code, except as set out
below.
The UK Code includes provisions relating to:
-- The role of the chief executive;
-- Executive directors' remuneration;
-- The appointment of a senior independent director; and
-- The need for an internal audit function.
The board considers these provisions are not relevant to the
Company, being an externally managed investment company with no
executive directors. In particular, all of the Company's day-to-day
management and administrative functions are outsourced to third
parties. As a result, the Company has no executive directors,
employees or internal operations. The Company has therefore not
reported further in respect of these provisions.
In addition, the board does not, at present, consider that
separate nomination and remuneration committees would be
appropriate given the board's size, being three members in total.
Currently, decisions concerning the board's remuneration,
nomination and board appraisals are undertaken by the board as a
whole. However, the need for separate nomination and remuneration
committees and an internal audit function will be kept under
review.
The Board of Directors
The board consists of three directors, all of whom are
non-executive directors. Biographies of the directors are shown on
page 18 and demonstrate the wide range of skills and experience
that they bring to the board. The directors possess business and
financial expertise relevant to the direction of the Company and
consider themselves to be committing sufficient time to the
Company's affairs.
None of the directors has a service contract with the Company,
nor are any such contracts proposed. Each director has been
appointed pursuant to a letter of appointment entered into with the
Company. The directors' appointment can be terminated in accordance
with the articles of association and without compensation. There
are no agreements between the Company and any director which
provide for compensation for loss of office in the event that there
is a change of control of the Company.
Copies of the letters of appointment will be available at the
AGM.
The Chairman, Perry Wilson, is independent and considers himself
to have sufficient time to commit to the Company's affairs. The
Chairman's other commitments are detailed in his biography on page
18.
The directors have determined that the size of the Company's
board does not warrant the appointment of a senior independent
director at this time. All of the directors are available to
address shareholder queries or engage in consultation as
required.
The operation of the Board
The board of directors meets at least four times a year and more
often if required.
The table below sets out the directors' attendance at board and
audit committee meetings held in the financial year ended 31 March
2021, against the number of meetings each board or audit committee
member was eligible to attend.
Director Board Audit Committee
======
Perry Wilson 7/7 2/2
================= ====== ================
Gareth Burchell 7/7 2/2
================= ====== ================
St John Agnew 7/7 2/2
================= ====== ================
No individuals other than the committee or board members are
entitled to attend the relevant meetings unless they have been
invited to attend by the board or relevant committee.
Directors are provided with a comprehensive set of papers for
each board or committee meeting, which equips them with sufficient
information to prepare for the meetings.
The board has a formal schedule of matters specifically reserved
to it for decision to ensure effective control of strategic,
financial, operational and compliance issues, which includes:
-- The Company's structure including share issues and setting a
discount/premium management programme;
-- Risk management
-- Appointing the Manager and other service providers and setting their fees;
-- Approving board changes including the audit committee and management engagement committee;
-- Considering and authorising board conflicts of interest;
-- Approving the Company's annual accounts and half yearly
accounts including accounting policies;
-- Approving the Company's level of gearing;
-- The approval of terms of reference and membership of board committees; and
-- Approving liability insurance.
There is a procedure in place for the directors to take
independent professional advice at the expense of the Company. No
such professional advice has been taken by the directors during the
period under review.
The directors' and officers' liability insurance covered by
Shard Capital AIFM LLP shall be maintained for the full term of
each director's appointment.
Division of Responsibilities
The Chairman leads the board and is responsible for its overall
effectiveness in directing the Company. He ensures that the
directors' views are taken into consideration as part of the
board's decision making process. The Chairman promotes a culture of
openness and debate at the Company's board meetings and ensures
that an appropriate amount of time is devoted to each matter on the
agenda for the board's consideration. He ensures that the board
receives accurate, timely and clear information in order for the
directors to discharge their duties. The Chairman is also available
to facilitate the board's relations with shareholders and the
Company's other stakeholders.
The Company has established audit and management engagement
committees which deal with matters determined by terms of reference
issued by the board.
The board ensures that an appropriate amount of time is spent on
board matters. The board receives papers ahead of board meetings,
which are reviewed by the directors to enable them to participate
effectively and efficiently at meetings. Other information is
received by the board between meetings and input is provided by
board members as required.
Independence of Directors
Each of Perry Wilson and St John Agnew were considered, on
appointment, to be independent of Shard Capital AIFM LLP and free
from any business or other relationship that could materially
interfere with the exercise of his independent judgement and
remained so throughout the financial year under review.
Gareth Burchell is a member of the Shard Capital AIFM LLP
investment committee and is therefore not considered to be
independent. Mr. Burchell is also currently Head of Shard Capital
Stockbrokers and chairs an investment committee that specialises in
providing funding for both listed and unlisted small companies. The
board believes that having Mr. Burchell on the board is beneficial
to the board as it provides the board with added insight on the
Company's investment portfolio. Mr. Burchell does not participate
in discussions on, or vote on, matters where there would be a
conflict or potential conflict of investment, including but not
limited, the evaluation of the Investment Manager.
There are no other relationships or circumstances relating to
the Company that are likely to affect the judgement of any of the
directors.
Composition
The board believes that during the year ended 31 March 2021, its
composition was appropriate for an investment company of the
Company's nature and size. Care will be taken at all times to
ensure that the board is composed of members who, as a whole, have
the required knowledge, abilities and experience to properly fulfil
their role and are sufficiently independent.
Directors' interests
No director holds shares in the Company.
Board evaluation
The most recent board evaluation was completed in July 2021. The
results of the evaluation were reviewed by the Chairman and
discussed with the board. The conclusions from the board evaluation
demonstrated that the directors showed the necessary commitment for
effective fulfilment of their duties.
Board training and induction
The Company Secretary, the board or the Manager upon request of
the board or any director individually, will offer induction
training to new directors about the Company, its key service
providers, the directors' duties and obligations and other matters
as may be relevant from time to time.
The board members are encouraged to keep up to date and attend
training courses on matters which are directly relevant to their
involvement with the Company.
Board appointment, election and tenure
The rules concerning the appointment and replacement of
directors are contained in the Company's articles of association
and the Companies Act 2006.
The board takes into account the requirements of the AIC Code
with regards to tenure. The board recognises the benefits to the
Company of having longer serving directors together with
progressive refreshment of the Board. None of the directors
consider length of service as an impediment to independence or good
judgement but, if they felt that this had become the case, the
relevant director would stand down. The Company was incorporated in
June 2017, therefore no director has served for more than nine
years. The board is currently developing a succession plan.
The Directors of the Company and their biographies are set out
on page 18. At the forthcoming AGM, in accordance with the AIC
Code, all members of the board will put themselves forward for
re-election.
The board considers that all of the current directors contribute
effectively to the operation of the board and the strategy of the
Company. The board has considered each board member's independence
of the Company and Manager. As such the board believes that it is
in the best interests of shareholders that each of the directors be
re-elected.
Basis of Directors' appointment
Consideration is given to the recommendations of the AIC Code on
diversity. The board seeks to appoint new directors on the basis of
merit as a primary consideration, with the aim of bringing an
appropriate range of skills, diversity and experience together.
Management agreement and continuing appointment
Details of the Manager's agreement and fees are set out in note
4 to the financial statements.
The board keeps the performance of the Manager under continual
review through the Company's management engagement committee. The
most recent evaluation of the Manager was completed on 21 July
2021, following which the board has concluded that due to its
specialist knowledge of the sectors in which the Company invests
and the Company's performance to date, the continuing appointment
of the Manager is in the best interests of shareholders as a
whole.
Conflicts of interest
The articles of association provide that the directors may
authorise any actual or potential conflict of interest that a
director may have, with or without imposing any conditions that
they consider appropriate on the director. Directors are not able
to vote in respect of any contract, arrangement or transaction in
which they have a material interest, and, in such circumstances,
they are not counted in the quorum at the relevant board meeting. A
process has been developed to identify any of the directors'
potential or actual conflicts of interest. This includes declaring
any potential new conflicts before the start of each board
meeting.
Audit Committee
The board has delegated certain responsibilities to its audit
committee. The committee comprises two or more independent
directors. The Chairman of the board may be a member of the
committee and due to the size of the Board, the Chairman of the
board, Perry Wilson acts as chairman of the Audit Committee. The
board has established formal terms of reference for the audit
committee which are available from the Company Secretary upon
request. An outline of the remit of the audit committee and its
activities during the year are set out below.
The audit committee is chaired by Perry Wilson and meets at
least twice a year. It is responsible for ensuring that the
financial performance of the Company is properly reported and
monitored and provides a forum through which the Company's external
auditor may report to the board. The audit committee reviews and
recommends to the board the annual and half-yearly reports and
financial statements, financial announcements, internal control
systems, risk metrics, decisions requiring a significant element of
judgement and procedures and accounting policies of the
Company.
Further details on the work of the audit committee can be found
in the report of the audit committee on pages 31 - 33.
Management Engagement Committee
The Chairman of the Company acts as chairman of the management
engagement committee. The management engagement committee meets
once a year. Its principal duties are to formally review the
actions and judgements of the Manager, the terms of its management
agreement and to review the performance and services of the
Company's other key service providers. The committee reports to the
board on its proceedings after each meeting.
The most recent evaluation of the Manager and other key service
providers was completed July 2021.
The terms of reference of the committee are available from the
Company Secretary.
Company secretary
The board has direct access to the advice and services of the
Company Secretary, which is responsible for ensuring that the board
and Committee procedures are followed, and that applicable rules
and regulations are complied with. The Company Secretary is also
responsible for ensuring good information flows between all
parties.
Review of shareholder profile
The board reviews reports provided by qualified independent
industry consultants and Shard Capital Partners LLP on the
Company's shareholder base and its underlying beneficial owners.
The Manager and Shard Capital Partners LLP disclose any concerns
raised by shareholders to the board.
Stewardship responsibilities and the use of voting rights
The Financial Reporting Council (FRC) introduced a Stewardship
Code which sets out the responsibilities of institutional
shareholders in respect of investee companies. Under the
Stewardship Code, managers should:
-- Publicly disclose their policy on how they will discharge
their stewardship responsibilities to their clients;
-- Disclose their policy on managing conflicts of interest;
-- Monitor their investee companies;
-- Establish clear guidelines on how they escalate Evaluation;
-- Be willing to act collectively with other investors where appropriate;
-- Have a clear policy on proxy voting and disclose their voting record; and
-- Report to clients.
The Company recognises that with respect to its equity assets
one of the important obligations that it has as a shareholder is
the right to vote on issues submitted to shareholders. These issues
may include the election of directors and other important matters
that affect the structure of the investee company. The Manager acts
on behalf of the Company in these matters and will exercise its
voting rights, supported by independent providers, if considered
appropriate, ahead of voting.
Relations with shareholders
All shareholders have the opportunity to attend and vote, in
person or by proxy, at the AGM. However, given the current
restrictions as a result of COVID-19, it is recommended that
shareholders vote by proxy as attendance at the AGM may not be
possible.
The notice of Annual General Meeting ("AGM") will be sent out
separately in due course. The notice of the AGM, which is sent out
at least 21 clear days in advance of the AGM, sets out the business
of the meeting and any item not of an entirely routine nature is
explained in the directors' report. Separate resolutions are
proposed in respect of each substantive issue.
Any questions that shareholders wish to raise at the AGM can be
emailed to info@sureventuresplc.com and the board and/or the
Manager will respond as appropriate.
Proxy voting figures will be published on the Company's website
following the AGM.
The Manager holds regular discussions with major shareholders,
the feedback from which is provided to and greatly valued by the
board. The directors are available to enter into dialogue and
correspondence with shareholders regarding the progress and
performance of the Company. Further information about the Company
can be found on the Company's website
http://www.sureventuresplc.com .
Internal control review
The board has elected not to have an internal audit function as
the Company delegates its operations to third-party service
providers and does not employ any staff. Instead it has been agreed
that the Company will rely on the internal controls which exist
within its third-party providers.
The administrator, depositary and manager have established
internal control frameworks to provide reasonable assurance on the
effectiveness of the internal controls operated on behalf of their
clients. The manager, the administrator, the depositary and the
Company Secretary will report on any breaches of law or regulation,
if and when they arise, periodically in scheduled board reports.
The audit committee considers annually whether there is any need
for an internal audit function, and it has agreed that it is
appropriate for the Company to rely on the internal audit controls
which exist within its third-party providers.
The board keeps under review the effectiveness of the
Administrator and the Manager's systems of internal control and
risk management. During the period under review, the board has not
identified any significant failings or weaknesses in the internal
control systems of its service providers. Details of the Company's
risks can be found on pages 13 to 15 of the Strategic Report,
together with an explanation of the controls that have been
established to manage each risk. The risk matrix provides a basis
for the audit committee and the board to regularly monitor the
effective operation of the controls and to update the matrix when
new risks are identified.
The system of internal control and risk management is designed
to meet the Company's particular needs and the risks to which it is
exposed. The board recognises that these control systems can only
be designed to manage, rather than eliminate, the risk of failure
to achieve business objectives and to provide reasonable, but not
absolute, assurance against material misstatement or loss.
Alternative Investment Fund Management Directive Disclosure
Quantitative remuneration disclosure
In accordance with 3.3.5 (5) of the Financial Conduct
Authority's Investment Funds Sourcebook ("FUND") and in accordance
with the Financial Conduct Authority's Finalised guidance - General
guidance on the AIFM Remuneration Code (SYSC 19B) ('the
Guidelines'), dated January 2014, the total amount of remuneration
paid by or paid to Shard Capital AIFM LLP, for the financial period
to the 31 March 2021 in respect of the Company was GBP.63,311. The
Shard Capital AIFM LLP out of its own resources decided to pay
rebates out of the management fee. For the financial period to the
31 March 2021, the Company incurred rebate income from Shard
Capital AIFM LLP GBP63,311. There was no performance fee payable in
respect of the year ended 31 March 2020. Shard Capital AIFM LLP
does not consider that any individual member of staff or partner of
Shard Capital AIFM LLP has the ability to materially impact the
risk profile of the Company.
Other disclosures
The AIFMD requires that Shard Capital AIFM LLP ensures that
certain other matters are actioned and or reported to investors.
Each of these is set out below.
-- Provision and content of an annual report (FUND 3.3.2 and
3.3.5). The publication of the annual report and accounts of the
Company satisfies these requirements.
-- Material change of information. The AIFMD requires certain
information to be made available to investors in the Company before
they invest and requires that material changes to this information
be disclosed in the annual report.
Periodic disclosure (FUND 3.2.5 and 3.2.6)
There are no assets subject to special arrangements due to their
illiquid nature and no new arrangements for the managing of the
liquidity of the Company.
There is no change to the arrangements, as set out in the
Prospectus, for managing the Company's liquidity.
The current risk profile of the Company is set out in the
Strategic Report: Principal Risks and Uncertainties on pages 13 to
15 and in note 15 of the Financial Statements, 'Financial Risk
Management'.
The Company is permitted to be leveraged and the table below
sets out the current maximum permitted and actual leverage.
As a percentage of net asset Gross Commitment
value method method
========
Maximum l e ve l of l e verage 100% 150%
================================ ======== ===========
Le verage as at 3 1 March 2021 75.61% 101.10%
================================ ======== ===========
There have been no breaches of the permitted leverage limits
within the reporting period and no changes to maximum level of
leverage employed by the Company.
Other matters
Shard Capital AIFM LLP has confirmed that all required reporting
to the Financial Conduct Authority has been undertaken in
accordance with FUND 3.4.
Approval
This Report was approved by the board of directors on 29 July
2021.
On behalf of the board
Perry Wilson
Chairman
Report of the Audit Committee
As chairman of the audit committee I am pleased to present the
audit committee report for the year ended 31 March 2021.
Membership of the Audit Committee
As the board is small with only three members, St John Agnew and
Perry Wilson are both appointed members of the audit committee. As
chairman of the audit committee, I can confirm that I have relevant
financial experience to fulfil my obligations in this capacity.
The role of the Audit Committee
The role of the audit committee is defined in its terms of
reference, which can be obtained from the Company Secretary.
In summary, the role of the audit committee includes the
following:
-- To monitor the financial reporting process;
-- To review and monitor the integrity of the half-year and
annual financial statements and review and challenge where
necessary the accounting policies and judgements of the manager and
administrator;
-- To review the adequacy and effectiveness of the Company's
internal financial and internal control and risk management
systems;
-- To make recommendations to the board on the re-appointment or
removal of the external auditor and to approve its remuneration and
terms of engagement;
-- To review and monitor the external auditor's independence and objectivity; and
-- To review and consider on an annual basis the need for an internal audit function.
Matters considered during the year
The audit committee has met twice during the year under review
and considered the following items:
-- The Company's audit plan with the external auditor;
-- The policy on non-audit services;
-- The dividend policy; and
-- The accounting restatement of the Income Statement for the year ended 31 March 2020.
The Audit Committee also reviewed the following items:
-- Whether there was a requirement for an internal audit function;
-- The Company's risk matrix and the internal controls implemented to manage those risks; and
-- The appropriateness of the Company's accounting policies and
whether appropriate estimates and judgements have been made.
UK non-audit services
In relation to non-audit services, the audit committee has
reviewed and implemented a policy on the engagement of the auditor
to supply non-audit services and this will be reviewed on an annual
basis. All requests or applications for other services to be
provided by the auditor are submitted to the audit committee and
will include a description of the services to be rendered and an
anticipated cost. The Company's policy follows the requirements of
the Financial Reporting Council's Revised Ethical Standard 2019.
The policy specifies a number of prohibited services which it is
not permitted for the auditor to provide under the revised Ethical
Standard.
For the year ended 31 March 2021, there were no non-audit fees
services rendered to the Company and none for the year ended 31
March 2020.
The audit committee reviewed the level of non-audit services and
were satisfied that the auditors maintained their independence.
Significant accounting matters
The audit committee met on 21 July 2021 to review the report and
accounts for the year to 31 March 2021. The audit committee
considered the following significant issues, including principal
risks and uncertainties in light of the Company's activities and
issues communicated by the auditors during their review, all of
which were satisfactorily addressed:
Issues considered How the issue was addressed
Retention of investment The aud it comm i ttee rece i v ed assu rance
trust status from t he C om p an y 's Investment Manager
t hat the Company has remained compliant
with the requirements to maintain its investment
trust status. The directors regularly review
the investments and their mix to ensure they
remain diversified, its retained income levels
to ensure sufficient distributions are made
and the Company's shareholdings to determine
if the Company has become a close company.
============================== ====================================================
R isk of mi s a pp T h e audit com mit t e e r e v ie w s r
r o p r i at io n e p o r t s fr o m it s s e r v i ce p r
of a s se t s a nd o v id ers on k e y cont rols ove r the as
owner shi p o f inve sets o f the Com p any . Any si g n ific
s tment s ant i s s ues a re r e p o rted to t he bo
ard by t he manager and/ or t he C om p an
y 's depositary. T he Manager h as p ut in
p l ace proce du r es to e n su re t h at
i nve s t m e n ts c an on ly be m ade to
t he e xte nt t h at t he appropr iate contractual
and legal a rran g ements a re in place to
p r o t e c t t h e C om p an y ' s assets.
The Company's depositary issues a quarterly
report on the status of the assets to the
directors for review.
============================== ====================================================
The r i sk t h at The board regularly reviews income forecasts.
i n c o me is ov e The external audit includes checks on the
r s t a t ed, incomplete completeness and accuracy of income and also
or in a c c u ra te checks that this has been recognised in accordance
t h r o u gh f ailu with stated accounting policies.
re to r e c o g ni
se p r o p er i n
c o me e nt i tl e
m e n ts or to app
ly t he approp r i
ate acco u n t ing
t r e atm e n t for
r e c o g n i t i
on of i n c o m e.
============================== ====================================================
The r i sk t h at The aud it comm i ttee rece i v es assu rance
valuation of the Investments from t he C om p an y 's admini s trators
held may be not be and manager t hat the Company's valuation
correct. policy is followed at all times.
============================== ====================================================
The accounting restatement Through restatement in current year.
of the Income Statement
for the year ended
31 March 2020.
============================== ====================================================
External auditor
The Company's external auditor, PKF Littlejohn LLP ("PKF"), was
appointed pursuant to the engagement letter dated 17 June 2021. The
audit committee intends to re-tender within the timeframe set by
the Financial Reporting Council.
The individual at PKF who acts as the Company's appointed audit
partner is Ian Cowan, whose appointment is reviewed annually. In
accordance with UK legislation, the audit partner must rotate at
least every five years. As this is Ian Cowan's fourth year as audit
partner, he will be due to rotate out of this role following the
completion of the audit for the year ended 31 March 2022.
The audit fees for the period under review can be found in note
5 to the financial statements on page 54.
The audit committee monitors the auditor's objectivity and
independence on an ongoing basis. In determining PKF's
independence, the audit committee has assessed all relationships
with PKF and received confirmation from PKF that it is independent
and that no issues of conflicts arose during the period. The audit
committee is therefore satisfied that PKF is independent.
The audit committee monitors and reviews the effectiveness of
the external audit process on an annual basis and makes
recommendations to the board on its re-appointment, remuneration
and terms of engagement of the auditor. The audit committee has met
with the audit partner and assessed PKF's performance to date and
to discuss the Company's audit and other matters concerning the
Company. I can confirm that Ian Cowan did not raise any issues of
concern during our meeting. The review has involved an examination
of the auditor's remuneration, the quality of its work including
the quality of the audit report, the quality of the audit partner
and audit team, the expertise of the audit firm and the resources
available to it, the identification of audit risk, the planning and
execution of the audit and the terms of engagement.
The audit committee has direct access to the Company's auditor
and provides a forum through which the auditor reports to the
board. Representatives of PKF attend the audit committee meetings
at least twice annually.
Internal audit
The audit committee believes that the Company does not require
an internal audit function, principally because the Company
delegates its day-to-day operations to third parties, which are
monitored by the audit committee, and which provide control reports
on their operations at least annually.
This report was approved by the audit committee on 29 July
2021.
Perry Wilson
C hai r m a n of t he Au d it C om m i ttee
Statement of Directors' Responsibilities
The directors are responsible for preparing the Annual Report,
the directors' Remuneration Report and the financial statements in
accordance with applicable law and regulations.
Applicable law requires the directors to prepare financial
statements for each financial year. As such the directors have
prepared the financial statements in accordance with international
accounting standards in conformity with the requirements of the
Companies Act 2006. 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 year. In preparing these financial
statements, the directors are required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- state whether applicable international accounting standards
have been followed, subject to any material departures disclosed
and explained in the financial statements; and
-- 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 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 and the directors' Remuneration Report
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.
The directors are responsible for the maintenance and integrity
of the Company's website. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
The directors consider that the Annual Report and financial
statements, taken as a whole, is fair, balanced and understandable
and provides the information necessary for shareholders to assess a
company's performance, business model and strategy.
Each of the directors, whose names and functions are listed in
the Directors' Report, confirms that, to the best of their
knowledge:
-- the financial statements, which have been prepared in
accordance with international accounting standards in conformity
with the requirements of the Companies Act 2006, give a true and
fair view of the assets, liabilities, financial position and profit
of the Company;
-- the Strategic Report includes a fair review of the
development and performance of the business and the position of the
Company, together with a description of the principal risks and
uncertainties that it faces;
-- so far as the director is aware, there is no relevant audit
information of which the Company's auditors are unaware; and
-- they have taken all the steps that they ought to have taken
as a director in order to make themselves aware of any relevant
audit information and to establish that the Company's auditors are
aware of that information.
Directors' Remuneration Report
Statement from the Chairman
I am pleased to present the directors' remuneration report for
the year ended 31 March 2021, prepared in accordance with The Large
and Medium-sized Companies and Groups (Accounts and Reports)
(Amendment) Regulations 2013 and the Companies Act 2006. The
Company's auditor is required to verify certain information within
this report subject to statutory audit by the Companies Act 2006.
Where information set out below has been audited it is indicated as
such.
We are required to seek shareholder approval of the directors'
remuneration policy at least every third year and the remuneration
report annually. Any changes to the directors' remuneration policy
will require shareholder approval. The Company's remuneration
policy is set out below and was last approved by shareholders at
the AGM held in September 2020. An ordinary resolution to approve
the directors' remuneration policy will be put to shareholders at
least once every three years. At the AGM, shareholders will also be
asked to consider an advisory resolution on the contents of the
directors' remuneration report.
As at 31 March 2021, the board comprised three non-executive
directors, two of whom are independent of the manager.
Given the size of the board, and as the Company has no
employees, it is not considered appropriate for the Company to
establish separate remuneration and nomination committees. It is,
therefore, the Company's practice for the board to consider and
approve directors' remuneration. Prior to the Company's
incorporation, directors' fees were set at the rate of GBP24,000
per director per annum for Perry Wilson. Gareth Burchell has agreed
to waive his director's fee.
As the board's fees were considered prior to its listing as an
investment company, the appointment of external remuneration
consultants was not considered necessary. Furthermore, the board
took the decision not to revise the board's fees because they did
not feel it was appropriate, given the Company's short existence.
Many parts of the Large and Medium-sized Companies and Groups
(Accounts and Reports) (Amendment) Regulations 2013 do not apply to
the Company as the board is comprised entirely of non-executive
directors and the Company has no employees.
Directors' remuneration policy
The remuneration policy was approved at the Company's Annual
General Meeting held on 24 September 2020, with all shareholders
present voting in favour of the resolution on a show of hands.
The maximum fees for the board as a whole are limited by the
Company's Articles of Association to GBP300,000 per annum. Subject
to this limit, the board's policy is that remuneration of
non-executive directors should reflect the experience of the board
member and the time commitment required by board members to carry
out their duties, and is determined with reference to the
appointment of directors of similar investment companies. The level
of remuneration has been set with the aim of promoting the future
success of the Company. With this in mind the board considers
remuneration in order to attract individuals of a calibre
appropriate to promote the long-term success of the Company and to
reflect the specific circumstances of the Company and its field of
investment, the duties and responsibilities of the directors and
the value and amount of time commitment required of directors to
the Company's affairs.
Due regard is taken of the board's requirement to attract and
retain individuals with suitable knowledge and experience and the
role that individual directors fulfil. There are no specific
performance-related conditions attached to the remuneration of the
board and the board members are not eligible for bonuses, pension
benefits, share options, long-term incentive schemes or other
non-cash benefits or taxable expenses. No other payments are made
to directors other than reasonable out-of-pocket expenses which
have been incurred as a result of attending to the affairs of the
Company.
In addition to the board's remuneration, board members are
entitled to such fees as they may determine in respect of any extra
or special services performed by them, having been called upon to
do so. Such fees would only be incurred in exceptional
circumstances. An example of such a circumstance would be if the
Company was to undertake a corporate action, which would require
the board to dedicate additional time to review associated
documents and to attend additional meetings. Such fees would be
determined at the board's absolute discretion and would be set at a
similar rate to other comparable investment companies who have
undertaken equivalent activities. The fees would be set with the
Company's long-term success in mind and the interests of the
Company's members as a whole would be considered prior to the
setting of such fees.
The directors are entitled to be paid all expenses properly
incurred by them in attending meetings with shareholders or other
directors or otherwise in connection with the discharge of their
duties as directors. Shareholders have the opportunity to express
their views in respect of directors' remuneration at the Company's
AGM. The Company has not sought shareholder views on its
remuneration policy. Any comment volunteered by shareholders on the
remuneration policy will be carefully considered and appropriate
action taken. No communications have been received from
shareholders on the Company's remuneration policy.
The Company's remuneration policy and its implementation are
reviewed by the board as a whole on an annual basis. Directors do
not vote on their own fees. Reviews are based on third parties'
information on the fees of other similar investment trusts.
None of the directors has a service contract with the Company,
nor are any such contracts proposed. Instead, directors are
appointed pursuant to a letter of appointment entered into with the
Company. There is no notice period specified in the letters of
appointment or articles of association for the removal of
directors. Directors are not appointed for a specific term. Copies
of the directors' letters of appointment are available at each of
the Company's AGMs.
The directors are not entitled to exit payments and are not
provided with any compensation for loss of office.
As with most investment trusts there is no chief executive
officer and no employees. The Company's remuneration policy will
apply to new board members, who will be paid the equivalent amount
of fees as current board members holding similar roles.
Voting at Annual General Meeting
As stated above an ordinary resolution for the approval of the
proposed directors' remuneration policy was last approved by
shareholders at the AGM held in September 2020.
The directors' remuneration report, including the implementation
of the directors' remuneration policy, is subject to an annual
advisory vote via an ordinary resolution. An advisory vote is a
non-binding resolution. At the last Annual General Meeting of the
Company held on 24 September 2020, the vote to approve the
Directors' Remuneration Report was passed with all shareholders
presented voted in favour of the relation by a show of hand and the
resolution was passed.
Directors' fees (audited)
Single total aggregate directors' remuneration for the year
under review was GBP52,200 (2020 GBP55,609). The directors who
served during the year under review received the following
emoluments:
Director Fees paid during Taxable Non-taxable Total year
the benefits benefits to
year under review 31 March 2021
(1 April 2020
to 31 March 2021)
=================== ========== ============
John St Agnew GBP26,100 GBP- GBP- GBP26,100
(1)
===================== =================== ========== ============ ===============
Perry Wilson (Chair) GBP26,100 GBP- GBP- GBP26,100
===================== =================== ========== ============ ===============
Total GBP52,200 GBP- GBP- GBP52,200
===================== =================== ========== ============ ===============
Director Fees paid during Taxable Non-taxable Total year
the benefits benefits to
year under review 31 March 2020
(1 April 2019
to 31 March 2020)
=================== ========== ============
Chris Boody (1) GBP8,315 GBP- GBP- GBP8,315
===================== =================== ========== ============ ===============
John St Agnew GBP21,173 GBP- GBP- GBP21,173
(1)
===================== =================== ========== ============ ===============
Perry Wilson (Chair) GBP26,121 GBP- GBP- GBP26,121
===================== =================== ========== ============ ===============
Total GBP55,609 GBP- GBP- GBP55,609
===================== =================== ========== ============ ===============
(1) Chris Boody resigned on 14 June 2019. John St Agnew
appointed on 14 June 2019.
No payments were made to past directors for loss of office. In
the absence of further major increases in the workload and
responsibility involved, the board does not expect fees to increase
significantly over the next three years. The overall remuneration
of each director will continue to be monitored by the board, taking
into account those matters referred to in the annual statement
above. The Company did not pay any other benefits including
bonuses, pension benefits, share options, long-term incentive
schemes or other non-cash benefits or taxable benefits.
The Company has not made any loans to the directors, nor has it
ever provided any guarantees for the benefit of any director or the
directors collectively nor does it intend to.
Company Performance
The board is responsible for the Company's investment strategy
and performance, although day-to-day management of the Company's
affairs, including the management of the Company's portfolio, has
been delegated to third-party service providers. An explanation of
the performance of the Company is given in the Chairman's statement
and the Investment Manager's report on pages 4 and 9.
Expenditure by the Company on Directors' remuneration compared
with distributions to shareholders
The following table is provided in accordance with The Large and
Medium-sized Companies and Groups (Accounts and Reports)
(Amendment) Regulations 2013 which sets out the relative importance
of spend on pay in respect of the year ended 31 March 2021. The
table shows the remuneration paid to directors for the period under
review, compared to the distribution payments to shareholders.
Year from
1 April 2020 to 31 March 2021
Total remuneration paid to Directors GBP52,200
===================================== ===============================
Shareholder distribution - dividends GBP-
or share buybacks
===================================== ===============================
Year from
1 April 2019 to 31 March 2020
Total remuneration paid to Directors GBP55,609
===================================== ===============================
Shareholder distribution - dividends GBP-
or share buybacks
===================================== ===============================
Directors' interests (audited)
The Company does not have any requirement for any director to
own shares in the Company.
As at 31 March 2021, the directors do not hold shares in the
Company.
There have been no changes to any holdings between 31 March 2021
and the date of this report.
Approval of the Annual Report on remuneration and the Directors'
remuneration policy
The Annual Report on remuneration was approved by the board on
29 July 2021 and signed on its behalf by:
Perry Wilson
Chairman
6 Independent Auditors' Report
INDEPENT AUDITOR'S REPORT TO THE MEMBERS OF SURE VENTURES
PLC
Opinion
We have audited the financial statements of Sure Ventures PLC
(the 'company') for the year ended 31 March 2021 which comprise the
Income Statement, the Statement of Financial Position, the
Statement of Changes in Equity, 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 accounting standards in conformity with the
requirements of the Companies Act 2006.
In our opinion, the financial statements:
-- give a true and fair view of the state of the company's
affairs as at 31 March 2021 and of its profit for the year then
ended;
-- have been properly prepared in accordance with international
accounting standards in conformity with the requirements of the
Companies Act 2006; and
-- 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 as applied to listed public interest
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
In auditing the financial statements, we have concluded that the
director's use of going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the directors' assessment of the company's ability to
continue to adopt the going concern basis of accounting
included:
a. Reviewing management's assessment of going concern, including
reviewing and challenging any management forecasts over the twelve
months immediately following the approval of the financial
statements
b. Reviewing management's assessment of the Covid-19 impact on the realisation of investments.
c. Determining if all relevant information has been included in
the assessment of going concern.
d. Reviewing the Company's ongoing maintenance of investment trust status.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
company's ability to continue as a going concern for a period of at
least twelve months from when the financial statements are
authorised for issue.
Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.
Our application of materiality
We apply the concept of materiality both in planning and
performing our audit, and in evaluating the effect of
misstatements. For planning, we consider materiality to be the
magnitude by which misstatements, including omissions, either
individually or in aggregate, could reasonably be expected to
influence the economic decisions of users that are taken on the
basis of the financial statements. Importantly, misstatements below
this level will not necessarily be evaluated as immaterial as we
also take account of the nature of identified misstatements, and
the particular circumstance 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 Amount Key considerations and benchmarks
-------------------------------------------------------------------- -------------------------------------------- ------------------- -----------------------------------------------------------------------
Overall financial statement materiality-Based on 1.5% of net assets Assessing whether the financial statements, GBP49,250 We used net assets as benchmark given the nature of the business,
as a whole present a true and fair view. which is asset focused,
particularly in respect of the following:
(2020: GBP67,600) * The value of the invested assets
* The level of judgment inherent in the valuation
* The range of reasonable alternative valuations
-------------------------------------------------------------------- -------------------------------------------- ------------------- -----------------------------------------------------------------------
We also determine a level of performance materiality which we
use to assess the extent of testing needed to reduce to an
appropriately low level the probability that the aggregate of
uncorrected and undetected misstatements exceeds materiality for
the financial statements as a whole. Performance materiality was
set at GBP34,475, being 70% of materiality for the financial
statements as a whole.
There were also no revisions in materiality in the course of the
audit.
We have agreed with the audit committee that we would report to
the committee as individual audit differences in excess of GBP2,462
(2020: GBP3,400) as well as differences below these thresholds
that, in our view, warranted reporting on qualitative grounds.
Our approach to the audit
Our audit approach was developed by obtaining an understanding
of the company's activities and the overall control environment.
Based on this understanding we assessed those aspects of the
company's transactions and balances which were most likely to give
rise to a material misstatement and were most susceptible to
irregularities including fraud or error. We looked at areas
involving significant accounting estimates and judgement by the
directors and considered future events that are inherently
uncertain. We also addressed the risk of management override of
internal controls, including evaluating whether there was evidence
of bias by the directors that represented a risk of material
misstatement due to fraud. We identified what we considered to be
key audit matters in the next section and planned our audit
approach accordingly.
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) 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. 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.
Key Audit Matter How the scope of our audit addressed
the key audit matter
The valuation of investments held We considered the design and
at fair value through implementation of
profit or loss. (Note 8). controls in place over the valuation
of investments
The valuation of investments at and also reviewed the assumptions
31 March 2021 was and underlying
GBP3,724,611 (2020 - GBP3,078,560) evidence supporting the year
consisting of a portfolio of listed, end valuations to
unlisted and fund investments. ensure that they are in line
with IFRS.
The valuation of the assets held
in the investment We obtained an understanding
portfolio is the key driver of of the valuation
the Company's net asset process applied by the company.
value. Incorrect investment valuations
could We agreed the value of the company's
materially affect the overall investment
investment portfolio in the Sure Valley Ventures Fund
valuation and subsequently the to the Fund's
return generated for audited financial statements
the shareholders. for the year ended 31
March 2021.
The investments valued at fair
value through profit or We reviewed the valuation methodology
loss in the Company's Non-Current applied for
assets at the each investment to consider whether
period end, are largely driven it was
by the audited Net Asset appropriate based on the investment's
Value ("NAV") of the investee individual
Fund's portfolio. circumstances and not inconsistent
with observed
The Investee Fund has holdings industry best practice and the
in private equity provisions of the
companies being Level 3 investments International Private Equity
that are valued and Venture Capital
according to a specific investment Valuation Guidelines.
methodology.
We agreed the inputs which drive
As the investments are material the overall
to the overall valuation to source documentation.
performance of the Company and
significant We considered the appropriateness
judgement is applied in valuing and relevance
these, there is a risk of disclosures in accordance
that the underlying investments with relevant
are inappropriately accounting standards.
valued.
We concluded that the valuations
attributed to the
Company's investments were appropriate.
=========================================
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 themselves. 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.
Corporate governance statement
The Listing Rules require us to review the directors' statement
in relation to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to the company's
compliance with the provisions of the UK Corporate Governance
Statement specified for our review.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements or our knowledge obtained during the audit:
-- Directors' statement with regards the appropriateness of
adopting the going concern basis of accounting and any material
uncertainties identified [set out on page 21];
-- Directors' explanation as to its assessment of the entity's
prospects, the period this assessment covers and why they period is
appropriate [set out on page 21].
-- Directors' statement that they consider the annual report and
the financial statements, taken as a whole, to be fair, balanced
and understandable [set out on page 34];
-- Board's confirmation that it has carried out a robust
assessment of the emerging and principal risks [set out on page
13];
Opinions on other matters prescribed by the Companies Act
2006
In our opinion, the part of the directors' remuneration report
to be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of
the audit:
-- the information given in the strategic report and the
directors' report for the financial period for which the financial
statements are prepared is consistent with the financial
statements;
-- the strategic report and the directors' report have 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 strategic report or
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 and the part of the directors'
remuneration report to be audited are not in agreement with the
accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made;
-- a corporate governance statement has not been prepared by the company; or
-- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Statement of Directors'
Responsibilities, 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.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud is detailed below:
-- We obtained an understanding of the company and the sector in
which it operates to identify laws and regulations that could
reasonably be expected to have a direct effect on the financial
statements. We obtained our understanding in this regard through
discussions with management, industry research, application of
cumulative audit knowledge and experience of the sector.
-- We determined the principal laws and regulations relevant to
the company in this regard to be those arising from taxation, the
Listing Rules and the Companies Act 2006.
-- We designed our audit procedures to ensure the audit team
considered whether there were any indications of non-compliance by
the company with those laws and regulations. These procedures
included, but were not limited to:
o Reviewing the financial statement disclosures and testing to
supporting documentation to assess compliance with relevant laws
and regulations discussed above;
o Using appropriate checklists and our experience to assess the
Company's compliance with the Companies Act 2006 and the Listing
Rules;
o Reading minutes of meetings of those charged with governance;
and
o Reviewing any legal or regulatory correspondence
All engagement team members were briefed on relevant laws and
regulations and potential fraud risks at the planning stage of the
audit. However, the primary responsibility for the prevention and
detection of fraud rest with those charged with governance of the
Company.
-- We also identified the risks of material misstatement of the
financial statements due to fraud. We considered, in addition to
the non-rebuttable presumption of a risk of fraud arising from
management override of controls, that a potential management bias
was identified in relation to the following areas:
o Valuation of the investments
o Revenue recognition
o We addressed the risk of bias by challenging the assumptions
and judgements made by management in each of the above noted
areas.
o As in all of our audits, we addressed the risk of fraud
arising from management override of controls by performing audit
procedures which included, but were not limited to: the testing of
journals; reviewing accounting estimates for evidence of bias; and
evaluating the business rationale of any significant transactions
that are unusual or outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk
that we will not detect all irregularities, including those leading
to a material misstatement in the financial statements or
non-compliance with regulation. This risk increases the more that
compliance with a law or regulation is removed from the events and
transactions reflected in the financial statements, as we will be
less likely to become aware of instances of non-compliance. The
risk is also greater regarding irregularities occurring due to
fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
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.
Other matters which we are required to address
We were appointed by the members on 16 April 2018 to audit the
financial statements for the period ending 31 March 2018 and
subsequent financial periods. Our total uninterrupted period of
engagement is four years covering the periods ending 31 March 2018
to 31 March 2021.
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.
We identified areas of laws and regulations that could
reasonably be expected to have a material effect on the financial
statements from our sector experience and through discussion with
the directors. We have identified the requirements of the
Disclosure Guidance and Transparency Rules, the UK Corporate
Governance Code and the Companies Act 2006 to be significant in the
context of this entity. We considered the extent of compliance with
those laws and regulations as part of our procedures on the related
financial statements items.
We communicated laws and regulations throughout our audit team
and remained alert to any indications of non-compliance throughout
the audit.
As with any audit, there remained a higher risk of non-detection
of irregularities, as these may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of
internal controls. Our audit opinion is consistent with the
additional report to the audit committee.
Use of our report
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.
Ian Cowan (Senior Statutory Auditor) 15 Westferry Circus
For and on behalf of PKF Littlejohn LLP Canary Wharf
Statutory Auditor
London E14 4HD
30 July 2021
7 Financial Statements
Income Statement
For the year ended 31 March 2021
2021 2020 Restated
====== =================================
Notes Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
======================================= ====== ========== ========= ========== ========== ========== ==========
Income
======================================= ====== ========== ========= ========== ========== ========== ==========
Gains on disposal of investments - 79,883 79,883 - 946,817 946,817
======================================= ====== ========== ========= ========== ========== ========== ==========
Other net changes in fair value
on financial assets at fair value
through profit or loss - 178,793 178,793 - (237,271) (237,271)
======================================= ====== ========== ========= ========== ========== ========== ==========
Rebate management fee 63,311 - 63,311 55,495 - 55,495
======================================= ====== ========== ========= ========== ========== ========== ==========
Total net income 63,311 258,676 321,987 55,495 709,546 765,041
======================================= ====== ========== ========= ========== ========== ========== ==========
Expenses
======================================= ====== ========== ========= ========== ========== ========== ==========
Management fee 4 (47,869) (15,442) (63,311) (37,881) (17,614) (55,495)
======================================= ====== ========== ========= ========== ========== ========== ==========
Custodian, secretarial and
administration
fees (98,625) - (98,625) (94,785) - (94,785)
======================================= ====== ========== ========= ========== ========== ========== ==========
Other expenses 5 (195,456) - (195,456) (169,280) - (169,280)
======================================= ====== ========== ========= ========== ========== ========== ==========
Total operating expenses (341,950) (15,442) (357,392) (301,946) (17,614) (319,560)
======================================= ====== ========== ========= ========== ========== ========== ==========
(Loss) / profit before Taxation
and after finance costs (278,639) 243,234 (35,405) (246,451) 691,932 445,481
======================================= ====== ========== ========= ========== ========== ========== ==========
Taxation 6 - - - - - -
======================================= ====== ========== ========= ========== ========== ========== ==========
(Loss) / profit after taxation (278,639) 243,234 (35,405) (246,451) 691,932 445,481
======================================= ====== ========== ========= ========== ========== ========== ==========
Earnings per share 7 (5.21) 4.55 (0.66) (5.06) 14.21 9.15
======================================= ====== ========== ========= ========== ========== ========== ==========
The total column of this statement represents the Income
statement prepared in accordance with international accounting
standards in conformity with the requirements of the Companies Act
2006. The supplementary revenue return and capital return columns
are both prepared under guidance issued by the Association of
Investment Companies. All items in the above statement derive from
continuing operations.
The Company does not have any income or expense that is not
included in net loss for the year. Accordingly, the net (loss) /
profit for the year is also the Total Comprehensive Income for the
year, as defined in IAS1 (revised).
The notes on pages 50 to 63 form an integral part of the
financial statements.
Statement of Financial Position
As at 31 March 2021 Company No. 10829500
Notes 31 March 31 March
2021 2020
GBP GBP
====== ============
Non-current assets
======================================== ====== ============ ==========
Investments held at fair value through
profit or loss 8 3,724,611 3,078,560
======================================== ====== ============ ==========
3,724,611 3,078,560
======================================== ====== ============ ==========
Current assets
======================================== ====== ============ ==========
Receivables 9 - 18,620
======================================== ====== ============ ==========
Cash and cash equivalents 1,255,199 1,700,601
======================================== ====== ============ ==========
1,255,199 1,719,221
======================================== ====== ============ ==========
Total assets 4,979,810 4,797,781
======================================== ====== ============ ==========
Current liabilities
======================================== ====== ============ ==========
Other payables 10 (54,046) (287,862)
======================================== ====== ============ ==========
(54,046) (287,862)
======================================== ====== ============ ==========
Total assets less current liabilities 4,925,764 4,509,919
======================================== ====== ============ ==========
Total net assets 4,925,764 4,509,919
======================================== ====== ============ ==========
Shareholders' funds
======================================== ====== ============ ==========
Ordinary share capital 11 53,507 48,699
======================================== ====== ============ ==========
Share premium 5,146,030 4,699,588
======================================== ====== ============ ==========
Revenue reserves (1,026,510) (747,871)
======================================== ====== ============ ==========
Capital reserves 752,737 509,503
======================================== ====== ============ ==========
Total shareholders' funds 4,925,764 4,509,919
======================================== ====== ============ ==========
Net asset value per share 12 92.06p 92.61p
======================================== ====== ============ ==========
The notes on pages 50 to 63 form an integral part of the
financial statements.
The financial statements on pages 46 to 63 were approved by the
board of directors and authorised for issue on 29 July 2021. They
were signed on its behalf by:
Perry Wilson, Chairman
Statement of Changes in Equity
For the year ended 31 March 2021
Ordinary Share Revenue Capital Total Total
Share Premium Reserves Reserves Reserves Equity
Capital GBP GBP GBP GBP GBP
GBP
========= ========== ============ ========== ==========
Balance
at
1
April
2020 48,699 4,699,588 (747,871) 509,503 (238,368) 4,509,919
===================== ========= ========== ============ ========== ========== ==========
Ordinary shares
issued 4,808 470,192 - - - 475,000
===================== ========= ========== ============ ========== ========== ==========
Ordinary
shares
issue
costs - (23,750) - - - (23,750)
===================== ========= ========== ============ ========== ========== ==========
(Loss)/profit after
taxation - - (278,639) 243,234 (35,405) (35,405)
===================== ========= ========== ============ ========== ========== ==========
Dividends - - - - - -
paid
in
the
year
===================== ========= ========== ============ ========== ========== ==========
Balance at 31 March
2021 53,507 5,146,030 (1,026,510) 752,737 (273,773) 4,925,764
===================== ========= ========== ============ ========== ========== ==========
For the year ended 31 March 2020
Ordinary Share Revenue Capital Total Total
Share Premium Reserves Reserves Reserves Equity
Capital GBP GBP GBP GBP GBP
GBP
========= ========== ========== ========== ==========
Balance at 1 April
2019 45,647 4,428,290 (501,420) (182,429) (683,849) 3,790,088
===================== ========= ========== ========== ========== ========== ==========
Ordinary shares
issued 3,052 289,948 - - - 293,000
===================== ========= ========== ========== ========== ========== ==========
Ordinary shares
issue costs - (18,650) - - - (18,650)
===================== ========= ========== ========== ========== ========== ==========
Profit/(loss) after
taxation - - (246,451) 691,932 445,481 445,481
===================== ========= ========== ========== ========== ========== ==========
Dividends paid - - - - - -
in the year
===================== ========= ========== ========== ========== ========== ==========
Balance at 31 March
2020 48,699 4,699,588 (747,871) 509,503 (238,368) 4,509,919
===================== ========= ========== ========== ========== ========== ==========
As at 31 March 2021 the Company had distributable revenue
reserves of GBPnil (2020: GBPnil) for the payment of future
dividends. The distributable reserves are the revenue reserves
GBPnil (2020: GBPnil) capital reserves GBP752,737 (2020:
GBP509,503).
The notes on pages 50 to 63 form an integral part of the
financial statements.
Statement of Cash Flows
For the year ended 31 March 2021
Notes For the year For the year
ended ended
31 March 31 March
2021 2020
GBP GBP
====== =============
Cash flows from operating activities:
=========================================== ====== ============= =============
Loss/(profit) after taxation (35,405) 445,481
=========================================== ====== ============= =============
Adjustments for:
=========================================== ====== ============= =============
Gain on sale on investment (79,883) (946,817)
=========================================== ====== ============= =============
Decrease/(increase) in receivables 18,620 (18,620)
=========================================== ====== ============= =============
(Decrease)/increase in payables 10 (233,816) 237,208
=========================================== ====== ============= =============
Unrealised loss/(gain) on foreign
exchange 8 119,496 (76,430)
=========================================== ====== ============= =============
Net changes in fair value on financial
assets at fair value through profit
or loss 8 (298,289) 313,482
=========================================== ====== ============= =============
Net cash (outflow) from operating
activities (509,277) (45,696)
=========================================== ====== ============= =============
Cash flows from investing activities:
=========================================== ====== ============= =============
Purchase of investments 8 (534,171) (1,894,014)
=========================================== ====== ============= =============
Sales of investments 8 146,796 1,226,119
=========================================== ====== ============= =============
Net cash (outflow) investing activities (387,375) (667,895)
=========================================== ====== ============= =============
Cash flows from financing activities*:
=========================================== ====== ============= =============
Proceeds from issue of ordinary shares 475,000 293,000
=========================================== ====== ============= =============
Share issue costs (23,750) (18,650)
=========================================== ====== ============= =============
Net cash inflow from financing activities 451,250 274,350
=========================================== ====== ============= =============
Net change in cash and cash equivalents (445,402) (439,241)
=========================================== ====== ============= =============
Cash and cash equivalents at the
beginning of the year 1,700,601 2,139,842
=========================================== ====== ============= =============
Net cash and cash equivalents 1,255,199 1,700,601
=========================================== ====== ============= =============
*The Company has no borrowings or liabilities from financing
activities.
The notes on pages 50 to 63 form an integral part of the
financial statements.
Notes to the Financial Statements
1) Principal Accounting Policies
Basis of accounting
The financial statements of Sure Ventures plc (the "Company")
have been prepared in accordance with international accounting
standards and interpretations in conformity with the requirements
of the Companies Act 2006.
The principal accounting policies adopted by the Company are set
out below. Where presentational guidance set out in the Statement
of Recommended Practice ('SORP') for investment trusts issued by
the Association of Investment Companies ('AIC') in October 2019 is
consistent with the requirements of the applicable international
accounting standards, the directors have sought to prepare the
financial statements on a basis compliant with the recommendations
of the SORP.
The financial statements have been prepared on a going concern
basis under the historical cost convention, as modified by the
inclusion of investments and financial instruments at fair value
through profit or loss.
All values are rounded to the nearest pound unless otherwise
indicated.
Foreign Currency
The presentation currency of the Company is pounds sterling, the
financial statements are prepared in this currency in accordance
with the Company's prospectus. The Company is required to nominate
a functional currency, being the currency in which the Company
predominantly operates. The board has determined that sterling is
the Company's functional currency.
Foreign exchange gains and losses relating to the financial
assets and liabilities carried at fair value through profit or loss
are presented in the income statement within 'other net changes in
fair value on financial assets and financial liabilities at fair
value through profit or loss'.
Presentation of Income statement
In order to better reflect the activities of an investment trust
company and in accordance with guidance issued by the AIC,
supplementary information which analyses the Income statement
between items of a revenue and capital nature has been presented
alongside the Income statement.
Income
Dividend income from investments is recognised when the
Company's right to receive payment has been established, normally
the ex-dividend date.
Interest income in profit or loss in the Income statement
includes bank interest. Interest income is recognised on an
accruals basis.
Capital distributions and all changes in fair value of
investments held at fair value through profit or loss are
recognised in the capital coloumn of the Income statement.
Expenses
All expenses are accounted for on the accruals basis. In respect
of the analysis between revenue and capital items presented within
the Income statement, all expenses have been presented as revenue
items except as follows:
Transaction costs which are incurred on the purchases or sales
of investments designated as fair value through profit or loss are
expensed to capital in the Income statement.
Expenses are split and presented partly as capital items where a
connection with the maintenance or enhancement of the value of the
investments held can be demonstrated and, accordingly, the
management fee for the financial year has been allocated 75.61%
(2020: 68.26%) to revenue and 24.39% (2020: 31.74%) to capital, in
order to reflect the directors' long term view of the nature of the
expected investment returns of the Company.
Capital Reserves
Increases and decreases in the valuation of investments and
realised/unrealised foreign exchange gain/(loss) held at the year
end are accounted for in the capital reserves.
Taxation
In line with the recommendations of the SORP, the allocation
method used to calculate tax relief on expenses presented against
capital returns in the supplementary information in the Income
statement is the 'marginal basis'. Under this basis, if taxable
income is capable of being entirely offset by expenses in the
revenue column of the Income statement, then no tax relief is
transferred to the capital return column.
Deferred tax is the tax expected to be payable or recoverable on
differences between the carrying amounts of assets and liabilities
in the financial statements and the corresponding tax bases used in
the computation of taxable profit and is accounted for using the
Statement of Financial Position liability method. Deferred tax
liabilities are recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which
deductible temporary differences can be utilised.
Deferred tax is calculated at the tax rates that are expected to
apply in the period when the liability is settled or the asset is
realised. Deferred tax is charged or credited in the revenue return
column of the Income statement, except when it relates to items
charged or credited directly to equity, in which case the deferred
tax is also dealt with in equity.
Investment trusts which have approval under Part 24, Chapter 4
of the Corporation Tax Act 2010 are not liable for taxation on
capital gains.
Classification
Financial assets and financial liabilities
In accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006., the
Company has designated its investments as financial assets at fair
value through profit or loss.
i) Financial assets at fair value through profit or loss
The Company has designated all of its investments upon initial
recognition as "financial assets at fair value through profit or
loss". Their performance is evaluated on a fair value basis, in
accordance with the risk management and investment strategies of
the Company.
ii) Financial assets at amortised cost
Financial assets that are classified as "financial assets at
amortised cost" include cash and cash equivalents and
receivables.
iii) Financial liabilities at fair value through profit or loss
Financial liabilities that are not at fair value through profit
or loss include other payables.
Derecognition
Financial assets are derecognised when the rights to receive
cash flows from the financial assets have expired or where the
group has transferred substantially all risks and rewards of
ownership. If substantially all the risks and rewards have been
neither retained nor transferred and the group has retained
control, the assets continue to be recognised to the extent of the
group's continuing involvement. Financial liabilities are
derecognised when they are extinguished.
Investments
All investments held by the Company have been designated at fair
value through profit or loss ('FVPL') but are also described in
these financial statements as investments held at fair value, and
are valued in accordance with the International Private Equity and
Venture Capital Valuation Guidelines ('IPEVCV') issued in December
2018 as endorsed by the British Private Equity and Venture Capital
Association.
Purchases and sales of unlisted investments are recognised when
the contract for acquisition or sale becomes unconditional.
Receivables
Receivables do not carry any interest and are short term in
nature. They are initially stated at their nominal value and
reduced by appropriate allowances for estimated irrecoverable
amounts (if any).
Cash and cash equivalents
Cash and cash equivalents (which are presented as a single class
of asset on the Statement of Financial Position) comprise cash at
bank and in hand and deposits with an original maturity of three
months or less. The carrying value of these assets approximates
their fair value.
Payables
Payables are non-interest bearing.
Dividends
Interim dividends are recognised in the year in which they are
paid. Final dividends are recognised when they have been approved
by shareholders.
New standards, amendments and interpretations effective from 1
January 2020
The following standards, amendments and interpretations, which
became effective in January 2020, are relevant to the Company.
IAS 1 - Presentation of Financial Statements, IAS 8 - Accounting
Policies, Changes in Accounting Policies
The International Accounting Standards Board has issued
'Definition of Material (Amendments to IAS 1 and IAS 8)' to clarify
the definition of 'material' and to align the definition used in
the Conceptual Framework and the standards themselves. The amended
definition is; Information is material if omitting, misstating or
obscuring it could reasonably be expected to influence decisions
that the primary users of general purpose financial statements make
on the basis of those financial statements, which provide financial
information about a specific reporting entity.
The amendment is effective from 1 January 2020 and the Company
has adopted the amendment and it has not resulted in any change to
the presentation of these financial statements.
Adoption of New and Revised Standards
There are no standards, amendments to standards or
interpretations that are effective for annual periods beginning on
or after 1 January 2021 that are expected to have a material effect
on the financial statements of the Company.
CAPITAL STRUCTURE
Share Capital
Ordinary shares are classed as equity. The ordinary shares in
issue have a nominal value of one penny and carry one vote
each.
Share Premium
This reserve represents the difference between the issue price
of shares and the nominal value of shares at the date of issue, net
of related issue costs.
Capital Reserve
Unrealised gains and losses on investments held at the year end
arising from movements in fair value, gains on disposal of
investments are taken to the capital reserve.
Revenue Reserve
Net revenue profits and losses of the Company.
2) Significant Accounting Judgements, Estimates and
Assumptions
The preparation of financial statements in conformity with
international accounting standards in conformity with the
requirements of the Companies Act 2006. requires the Company to
make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting
year. Although these estimates are based on the directors' best
knowledge of the amount, actual results may differ ultimately from
those estimates.
The areas requiring a higher degree of judgement or complexity
and areas where assumptions and estimates are significant to the
financial statements are in relation to investments at fair value
through profit or loss described below.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected.
Equity Investments
The unquoted equity assets are valued on a periodic basis using
techniques including a market approach, costs approach and/or
income approach. The valuation process is collaborative, involving
the finance and investment functions within the manager with the
final valuations being reviewed by the manager's valuation
committee.
Shareholders should note that increases or decreases in any of
the inputs in isolation may result in higher or lower fair value
measurements. Changes in fair value of all investments held at fair
value are recognised in the Income statement as a capital item. On
disposal, realised gains and losses are also recognised in the
Income statement.
3) Segmental Reporting
The Company's board and the Investment Manager consider
investment activity in selected Equity Assets as the single
operating segment of the Company, being the sole purpose for its
existence. No other activities are performed.
The directors are of the opinion that the Company is engaged in
a single segment of business and operations of the Company are
wholly in the United Kingdom.
4) Management and Performance Fee
Management Fee
The management fee is payable quarterly in advance at a rate
equal to 1/4 of 1.25% per month of net asset value (the "Management
Fee"). The aggregate fee payable on this basis must not exceed
1.25% of the net assets of the Company in any year.
During the year the Company incurred GBP63,311 (2020: GBP55,495)
of fees and at 31 March 2021, there was GBPnil (2020: GBPnil)
payable to the Manager.
Management fee is allocated to revenue and capital expenses in
order to reflect the directors' long term view of the nature of the
expected investment returns of the Company. The revenue expense is
the percentage of investment held at fair value through profit or
loss to the net asset value of the Company. The management fee for
the financial year has been allocated 75.61% (2020: 68.26%) to
revenue and 24.39% (2020: 31.74%) to capital.
Performance Fee
The Manager is entitled to a performance fee, which is
calculated in respect of each twelve month period starting on 1
April and ending on 31 March in each calendar year ('Calculation
Period'), and the nal Calculation Period shall end on the day on
which the management agreement is terminated or, if earlier, the
business day immediately preceding the day on which the Company
goes into liquidation.
The Manager is entitled to receive a performance fee equal to
15% of any excess returns over a high watermark, subject to
achieving a hurdle rate of 8% in respect of each performance
period. There is no performance fee charged during the year ended
31 March 2021. (2020: GBPnil)
5) Other Expenses
For the For the
year year
ended ended
31 March 31 March
2021 2020
GBP GBP
==========
Auditor's remuneration - audit fees 22,700 29,940
===================================== ========== ==========
Directors' fees 52,200 55,609
===================================== ========== ==========
VAT Expense 26,954 12,285
===================================== ========== ==========
Legal and other professional 19,039 7,270
===================================== ========== ==========
Listing fees 50,689 24,433
===================================== ========== ==========
Service Fee Expense 8,987 8,879
===================================== ========== ==========
Other expenses 14,887 30,864
===================================== ========== ==========
Total Other expenses 195,456 169,280
===================================== ========== ==========
All expenses are inclusive of VAT where applicable. Further
details on directors' fees can be found in the directors'
remuneration report on page 35.
6) Taxation
As an investment trust the Company is exempt from corporation
tax on capital gains. The Company's revenue income is subject to
tax, but offset by any interest distribution paid, which has the
effect of reducing that corporation tax to nil (2020: nil). This
means the interest distribution may be taxable in the hands of the
Company's shareholders.
Any change in the Company's tax status or in taxation
legislation generally could affect the value of investments held by
the Company, affect the Company's ability to provide returns to
shareholders, lead the Company to lose its exemption from UK
Corporation tax on chargeable gains or alter the post-tax returns
to shareholders. It is not possible to guarantee that the Company
will remain a non-close company, which is a requirement to maintain
status as an investment trust, as the ordinary shares are freely
transferable. The Company, in the event that it becomes aware that
it is a close company, or otherwise fails to meet the criteria for
maintaining investment trust status, will as soon as reasonably
practicable, notify shareholders of this fact.
The Company has obtained initial approval of investment trust
status from HM Revenue & Customs and the directors believe that
the Company has met the ongoing investment trust requirements since
the date of initial approval.
Factors affecting taxation charge for the year
The taxation charge for the year is lower than the standard rate
of UK corporation tax of 19.00% (2020: 19.00%). A reconciliation of
the taxation charge based on the standard rate of UK corporation
tax to the actual taxation charge is shown below.
31 March 2021 Revenue Capital Total
GBP GBP GBP
========== =========
Return on ordinary activities
before taxation (278,639) 243,234 (35,405)
======================================== ========== ========= =========
Return on ordinary activities
before taxation multiplied by
the standard rate of UK corporation
tax of 19% (52,941) 46,214 (6,727)
======================================== ========== ========= =========
Effects of:
======================================== ========== ========= =========
Excess management expenses (utilised)/
not utilised 52,941 (46,214) 6,727
======================================== ========== ========= =========
Interest distributions paid in
respect of the year - - -
======================================== ========== ========= =========
Total tax charge in income statement - - -
======================================== ========== ========= =========
31 March 2020 Restated Revenue Capital Total
GBP GBP GBP
========== ==========
Return
on
ordinary
activities
before
taxation (246,451) 691,932 445,481
====================================== ========== ========== =========
Return
on
ordinary
activities
before
taxation
multiplied
by
the
standard
rate
of
UK
corporation
tax
of
19% (46,826) 131,467 84,641
====================================== ========== ========== =========
Effects
of:
====================================== ========== ========== =========
Excess
management
expenses
not
utilised 46,826 (131,467) (84,641)
====================================== ========== ========== =========
Interest distributions paid in
respect of the year - - -
====================================== ========== ========== =========
Total tax charge in income statement - - -
====================================== ========== ========== =========
Overseas taxation
The Company may be subject to taxation under the tax rules of
the jurisdictions in which it invests, including by way of
withholding of tax from interest and other income receipts.
Although the Company will endeavour to minimise any such taxes this
may affect the level of returns to shareholders.
Factors that may affect future tax charges
At 31 March 2021, the Company had unrelieved losses of
GBP809,433 (2020: GBP515,352) available to offset future taxable
revenue. A deferred tax asset of GBP153,792 (2020: GBP97,917) has
not been recognised because the Company is not expected to generate
sufficient taxable income in future periods in excess of the
available deductible expenses and accordingly, the Company is
unlikely to be able to reduce future tax liabilities through the
use of existing surplus losses.
Deferred tax is not provided on capital gains and losses arising
on the revaluation or disposal of investments because the Trust
meets (and intends to continue for the foreseeable future to meet)
the conditions for approval as an Investment Trust company.
7) Earnings per Share
For the financial year ended 31 Revenue Capital Total
March 2021 pence pence pence
======== ========
Earnings per ordinary share (5.21)p 4.55p (0.66)p
================================= ======== ======== ========
The calculation of the above is based on revenue returns of
(GBP278,639) capital returns of GBP243,234 and total returns of
(GBP35,405) and the weighted average number of ordinary shares of
5,350,725 as at 31 March 2021.
For the financial period ended Revenue Capital Total
31 March 2020 Restated pence pence pence
======== ========
Earnings per ordinary share (5.06)p 14.21p 9.15p
================================ ======== ======== =======
The calculation of the above is based on revenue returns of
(GBP246,451) capital returns of GBP691,932 and total returns of
GBP445,481 and the weighted average number of ordinary shares of
4,869,956 as at 31 March 2020.
8) Fair Value Measurements
(a) Movements in the year
As of 31 As of 31
March 2021 March 2020
GBP GBP
============
Opening cost
============================================== ============ ============
Opening fair value 3,078,560 1,700,900
============================================== ============ ============
Purchases at cost 534,171 1,894,014
============================================== ============ ============
Sale (66,913) (279,301)
============================================== ============ ============
Realised (loss) (1,790) (22,136)
============================================== ============ ============
Unrealised gain/(loss) 300,079 (291,347)
============================================== ============ ============
Unrealised (loss)/gain on foreign exchange (119,496) 76,430
============================================== ============ ============
Closing fair value at 31 March 2021 and 2020 3,724,611 3,078,560
============================================== ============ ============
(b) Accounting classifications and fair values
IFRS 13 requires the Company to classify its financial
instruments held at fair value using a hierarchy that reflects the
significance of the inputs used in the valuation methodologies.
These are as follows:
-- Level 1 - quoted prices in active markets for identical investments;
-- Level 2 - other significant observable inputs (including
quoted prices for similar investments, interest rates, prepayments,
credit risk, etc.); and
-- Level 3 - significant unobservable inputs (including the
Company's own assumptions in determining the fair value of
investments).
The following sets out the classifications used as at 31 March
2021 in valuing the Company's investments:
Carrying amount Fair value
------------------------------------------------------- ----------------------------------------
Financial
assets at Total
Mandatorily amortised Other financial carrying Level
31 March 2021 at FVTPL cost liabilities amount Level 1 2 Level 3 Total
----------------- ------------ ----------- ---------------- ---------- -------- ------ ---------- ----------
GBP GBP GBP GBP GBP GBP GBP GBP
------------ ----------- ---------------- ---------- -------- ------ ---------- ----------
Investments in
quoted equity
assets 406,172 - - 406,172 406,172 - - 406,172
Investments in
unquoted equity
assets 3,318,439 - - 3,318,439 - - 3,318,439 3,318,439
3,724,611 - - 3,724,611 406,172 - 3,318,439 3,724,611
----------------- ------------ ----------- ---------------- ---------- -------- ------ ---------- ----------
Financial assets
not measured
at fair value
Cash and cash
equivalents - 1,255,199 - 1,255,199
- 1,255,199 - 1,255,199
----------------- ------------ ----------- ---------------- ----------
Financial
liabilities not
measured at fair
value
Other payables - - 54,045 54,045
- - 54,045 54,045
----------------- ------------ ----------- ---------------- ----------
Carrying amount Fair value
------------------------------------------------------- ----------------------------------------
Financial
assets at Total
Mandatorily amortised Other financial carrying Level
31 March 2020 at FVTPL cost liabilities amount Level 1 2 Level 3 Total
----------------- ------------ ----------- ---------------- ---------- -------- ------ ---------- ----------
GBP GBP GBP GBP GBP GBP GBP GBP
------------ ----------- ---------------- ---------- -------- ------ ---------- ----------
Investments in
quoted equity
assets 148,796 - - 148,796 148,796 - - 148,796
Investments in
unquoted equity
assets 2,929,764 - - 2,929,764 - - 2,929,764 2,929,764
3,078,560 - - 3,078,560 148,796 - 2,929,764 3,078,560
----------------- ------------ ----------- ---------------- ---------- -------- ------ ---------- ----------
Financial assets
not measured
at fair value
Cash and cash
equivalents - 1,700,601 - 1,700,601
Receivables - 18,620 - 18,620
----------------- ------------ ----------- ---------------- ----------
- 1,719,221 - 1,719,221
----------------- ------------ ----------- ---------------- ----------
Financial
liabilities not
measured at fair
value
Other payables - - 287,862 287,862
- - 287,862 287,862
----------------- ------------ ----------- ---------------- ----------
9) Receivables
31 March 31 March
2021 2020
GBP GBP
==========
Prepayments - 18,620
=================== ========== =========
Total receivables - 18,620
=================== ========== =========
The above receivables do not carry any interest and are short
term in nature. The directors consider that the carrying values of
these receivables approximate their fair value.
10) Other Payables
31 March 31 March
2021 2020
GBP GBP
=========
Accruals and deferred income 54,046 37,863
============================== ========= =========
Other creditors - 250,000
============================== ========= =========
Total other payables 54,046 287,863
============================== ========= =========
Other Creditors represents cash subscriptions received in
advance, which were issued as new shares by the company on 1 April
2020.
The above payables do not carry any interest and are short term
in nature. The directors consider that the carrying values of these
payables approximate their fair value.
11) Ordinary Share Capital
The table below details the issued share capital of the Company
as at the date of the Financial Statements.
Issued and allotted No. of shares GBP No. of shares
31 March 31 March GBP
2021 2020
============== ======= ==============
Ordinary shares of 1
penny each 5,350,725 53,507 4,869,956 48,699
====================== ============== ======= ============== =======
The following table details the subscription activity for the
year ended 31 March 2021.
31 March 31 March
2021 2020
==========
Balance as at 1 April 2020 4,869,956 4,564,748
============================= ========== ==========
Ordinary shares issued 480,769 305,208
============================= ========== ==========
Balance as at 31 March 2021 5,350,725 4,869,956
============================= ========== ==========
During the year ended 31 March 2021 and 2020, all proceeds from
this issue was received.
12) Net Asset Value per Ordinary Share
Year ended 31 March Year ended 31 March 2020
2021
===========================
Year ended 31 March Net asset Net assets Net asset Net assets
2021 value per attributable value per attributable
ordinary GBP ordinary GBP
share share
Pence Pence
===================== =========== ============== =========== ==============
Ordinary shares of
1 penny each 92.06p 4,925,764 92.61p 4,509,919
===================== =========== ============== =========== ==============
The net asset value per ordinary share is based on net assets at
the year ended of GBP4,925,764 (2020: GBP4,509,919) and on
5,350,725 (2020: 4,869,956) ordinary shares in issue at the year
end.
13) Contingent Liabilities and Capital Commitments
The Company may invest in Sure Valley Ventures or other
collective investment vehicles, subscriptions to which are made on
a commitment basis. The Company will be expected to make a
commitment that may be drawn down, or called, from time to time at
the discretion of the manager of the Fund or other collective
investment vehicle. The Company will usually be contractually
obliged to make such capital call payments and a failure to do so
would usually result in the Company being treated as a defaulting
investor by the Fund or other collective investment vehicle.
The Company has to satisfy capital calls on its commitments and
will do through a combination of reserves, and where applicable the
realisation of Cash and Cash Equivalents and Liquid Investments (as
each expression is defined in the prospectus dated 17 November
2017), anticipated future cash flows to the Company, the use of
borrowings and, potentially, further issues of Shares.
As of 31 March 2021, the Company had outstanding commitments in
relation to the Fund in the amount of EUR 3.3 million (2020: EUR
3.9 million).
14) Related Party Transactions and Transactions with the
Manager
Directors - The remuneration of the directors is set out in the
directors' Remuneration Report on page 35. There were no contracts
subsisting during or at the end of the year in which a director of
the Company is or was interested and which are or were significant
in relation to the Company's business. There were no other
transactions during the year with the directors of the Company. The
directors do not hold any ordinary shares of the Company.
At 31 March 2021, there was GBP1,441 (2020: GBP1,473) payable to
the directors for fees and expenses.
Manager - Shard Capital AIFM LLP (the 'Manager'), a UK-based
company authorised and regulated by the Financial Conduct
Authority, has been appointed the Company's manager and authorised
investment fund manager for the purposes of the Alternative
Investment Fund Managers Directive. Details of the services
provided by the manager and the fees paid are given in Note 4.
During the year the Company incurred GBP63,311 (2020: GBP55,495)
of fees and at 31 March 2021, there was GBPnil (2020: GBPnil)
payable to the Manager.
During the year the Company paid GBP23,750 (2020: GBP18,650) of
placement fees to Shard Capital Partners LLP.
The Company paid Corporate Broking Retainer fees of GBP12,000
(excluding VAT) to Shard Capital Partners LLP during the year ended
31 March 2021.
15) Financial Risk Management
The Company's investment objective is to achieve capital growth
for investors pursuant to the investment policy outlined in the
prospectus, this involves certain inherent risks. The main
financial risks arising from the Company's financial instruments
are market risk, credit risk and liquidity risk. The board reviews
and agrees policies for managing each of these risks as summarised
below.
Market risk
Market risk is the risk that the fair value of future cash flows
of a financial instrument will fluctuate. Market risk comprises
three types of risk, price risk, interest rate risk and currency
risk.
-- Price risk - the risk that the fair value or future cash
flows of financial instruments will fluctuate because of changes in
market prices (other than those arising from interest rate risk or
currency risk);
-- Interest rate risk - the risk that the fair value or future
cash flows of financial instruments will fluctuate because of
changes in market interest rates; and
-- Currency risk - the risk that the fair value or future cash
flows of financial instruments will fluctuate because of changes in
foreign exchange rates.
The Company's exposure, sensitivity to and management of each of
these risks is described below. Management of market risk is
fundamental to the Company's investment objective. The investment
portfolio is continually monitored to ensure an appropriate balance
of risk and reward within the parameters of the investment
restrictions outlined in the prospectus.
(a) Price risk
Price risk arises mainly from uncertainty about future prices of
financial instruments used in the Company's business. It represents
the potential loss the Company might suffer through holding market
positions in the face of price movements (other than those arising
from interest rate risk or currency risk) specifically in equity
investments purchased in pursuit of the Company's investment
objective, held at fair value through the profit and loss.
As at 31 March 2021 the Company held two direct private equity
investments in the participating shares of Sure Valley Ventures
(formerly Suir Valley Ventures), a sub-fund of Suir Valley Funds
ICAV and VividQ Limited. (2020: the Company held two direct private
equity investment in the participating shares of Sure Valley
Ventures (formerly Suir Valley Ventures), a sub-fund of Suir Valley
Funds ICAV).
As at 31 March 2021 and 2020 the investment in Sure Valley
Ventures (formerly Suir Valley Ventures) is valued at the net asset
value of the sub-fund, as calculated by its administrator.
At 31 March 2021, had the fair value of investments strengthened
by 10% with all other variables held constant, net assets
attributable to holders of participating shares would have
increased by GBP372,461 (2020: GBP307,856). A 10% weakening of the
market value of investments against the above would have resulted
in an equal but opposite effect on the above financial statement
amounts to the amounts shown above, on the basis that all other
variables remain constant. Actual trading results may differ from
this sensitivity analysis and the difference may be material.
(b) Interest rate risk
Interest rate risk arises from the possibility that changes in
interest rates will affect future cash flows or the fair values of
financial instruments.
The Company currently employs no borrowings.
The Company finances its operations mainly through its share
capital and reserves, including realised gains on investments.
Exposure of the Company's financial assets and liabilities to
floating interest rates (giving cash flow interest rate risk when
rates are reset) and fixed interest rates (giving fair value risk)
as at 31 March 2021 and 31 March 2020 is shown below:
31 March 2021 31 March 2020
======================================
Financial instrument Fixed or Fixed or
Floating Administered Floating Administered
Rate Rate Total Rate Rate Total
GBP GBP GBP GBP GBP GBP
====================== ========== ============== ========== ========= ============== ==========
Cash and cash
equivalents - 1,255,199 1,255,199 - 1,700,601 1,700,601
======================= ========= ============== ========== ========= ============== ==========
Total exposure - 1,255,199 1,255,199 - 1,700,601 1,700,601
======================= ========= ============== ========== ========= ============== ==========
An administered rate is not like a floating rate, movements in
which are directly linked to LIBOR. The administered rate can be
changed at the discretion of the counterparty.
(c) Currency risk
As at 31st March 2021 the Company's largest investment is
denominated in Euros whereas its functional and presentation
currency is Pounds sterling. Consequently, the Company is exposed
to risks that the exchange rate of its currency relative to Euros
may change in a manner that has an adverse effect on the fair value
of the Company's assets.
At the reporting date the carrying value of the Company's
financial assets and liabilities held in individual foreign
currencies as a percentage of its net assets were as follows:
Foreign currency exposure as a percentage 31 March 31 March
of net assets 2021 2020
=========
Euros 57% 54%
=========================================== ========= =========
Sensitivity analysis
If the Euro exchange rates increased/decreased by 10% against
Pounds sterling, with all other variables held constant, the
increase/decrease in the net asset attributable to the Company
arising from a change financial assets at fair value through profit
or loss, which are denominated in Euros, would have been +/-
GBP281,844 (2020: GBP242,976).
16) Credit risk
Credit risk is the risk that one party to a financial instrument
will cause a financial loss for the other party by failing to
discharge an obligation.
The Company's credit risks arise principally through cash
deposited with banks, which is subject to risk of bank default.
The Company ensures that it only makes deposits with
institutions with appropriate financial standing.
Due to the low credit risk of the financial assets at amortised
cost, the Expected credit loss ("ECL") was determined to be
immaterial and no impairment was recognised on the Fund in the year
ended 31 March 2021.
Liquidity risk
Liquidity risk is the risk that the Company will have difficulty
in meeting its obligations in respect of financial liabilities as
they fall due.
The Company manages its liquid resources to ensure sufficient
cash is available to meet its expected contractual commitments. It
monitors the level of short-term funding and balances the need for
access to short-term funding, with the long-term funding needs of
the Company.
Capital Management
The Company's capital is represented by ordinary shares and
reserves.
The Company's primary objectives in relation to the management
of capital are:
-- to maximise the long-term capital growth for its shareholders
pursuant to its investment objective;
-- to ensure its ability to continue as a going concern.
The Company manages its capital structure and liquidity
resources to meet its obligations as described above.
Borrowing limits
Pursuant to the prospectus dated 17 November 2017 the Company
can deploy gearing up to 20% of the net asset value of the Company
(calculated at the time of borrowing) to seek to enhance returns
and for the purpose of capital flexibility and efficient portfolio
management. During the year ended 31st March 2021 and 2020 the
Company employed no gearing.
17) Prior year restatements
There is an adjustment to the classification of Income within
the Financial Statements for the year ending 31 March 2020. Sure
Ventures owns units in Sure Valley Ventures (SVV) which is an Irish
fund. SVV sold its stake in Artomatix for EUR 6.2m, with an initial
cash payment of EUR 5.65m on completion, resulting in a capital
distribution of EUR 1.4m payable to Sure Ventures.
An amount of GBP946,817 in respect of the above capital
distribution was allocated to the revenue column of the Income
Statement contained in the audited financial statements of the
Company for the year ended 31 March 2020. Following a review of the
position, the Board considers that this treatment does not
accurately reflect the capital nature of the Artomatix
distribution. The comparative figures for the year ended 31 March
2020 will be restated to reflect the above distribution as capital
rather than revenue.
Management fee distribution of 24.24% and 75.76% revenue and
capital expenses respectively have been restated as 68.26% and
31.74% to revenue and capital expenses respectively.
The above restatement had no impact on the Net Asset Value of
the Company.
18) Ultimate Controlling Party
It is the opinion of the directors that there is no ultimate
controlling party.
19) Events after the Reporting Period
Subsequent to the year end up till the date of signing these
financial statements, the Company had the following significant
events:
-- 662,500 ordinary shares at GBP1 per share have been issued
-- investments of GBP261,361 in Immotion Group plc were sold.
8 Alternative Performance Measures (APMs)
APMs are often used to describe the performance of investment
companies although they are not specifically defined under IFRS.
Calculations for APMs used by the Company are shown below.
Ongoing charges
A measure expressed as a percentage of average net assets, of
the regular, recurring annual costs of running an investment
company, calculated in accordance with the AIC methodology.
Year ended 31 March 2021 Page
Average NAV (GBP'000) a not applicable GBP5,059
----- ---------------- ---------
Recurring costs (GBP'000) b 47 GBP231
----- ---------------- ---------
b/a 4.6%
----------------------- -------------------------- ---------
Premium
The amount, expressed as a percentage, by which the share price
is more than the NAV per share.
As at 31 March 2021 Page
NAV per ordinary share a not applicable 92.06p
--------- ---------------- -------
Share price b not applicable 105p
--------- ---------------- -------
(b-a)/a 14.06%
--------------------------- ----------------------- -------
Total return
A measure of performance that includes both income and capital
returns. This takes into account capital gains and reinvestment of
any dividends paid out by the Company, with reinvestment on
ex-dividend date
Year ended 31 March Page NAV Share price
2021
Opening as at 1 April
2020 (p) a 2 92.61 105.13
--------- ----- ------- ------------
Closing at 31 March
2021 (p) b 2 92.06 105.00
--------- ----- ------- ------------
Dividend reinvestment
factor c n/a 1 1
--------- ----- ------- ------------
Adjusted closing (d
= b x c ) d 92.06 105.00
--------- ----- ------- ------------
(d-a) /
Total return a -0.59% -0.12%
--------- ----- ------- ------------
9 Glossary
AIC Association of Investment Companies
Alternative Investment An investment vehicle under AIFMD. Under
Fund or AIFMD (see below) Sure Ventures plc is classified
"AIF" as an AIF.
---------------------------------------------------
Alternative Investment A European Union directive which came into
Fund force on 22 July 2013 and has been implemented
Managers Directive in the UK.
or "AIFMD"
---------------------------------------------------
Annual General Meeting A meeting held once a year which shareholders
or "AGM" can attend and where they can vote on resolutions
to be put forward at the meeting and ask
directors questions about the company in
which they are invested.
---------------------------------------------------
the Company Sure Ventures plc
---------------------------------------------------
Custodian An entity that is appointed to safeguard
a company's assets.
---------------------------------------------------
Discount The amount, expressed as a percentage, by
which the share price is less than the net
asset value per share.
---------------------------------------------------
Depositary Certain AIFs must appoint depositaries under
the requirements of AIFMD. A depositary's
duties include, inter alia, safekeeping
of a company's assets and cash monitoring.
Under AIFMD the depositary is appointed
under a strict liability regime.
---------------------------------------------------
Dividend Income receivable from an investment in
shares.
---------------------------------------------------
Ex-dividend date The date from which you are not entitled
to receive a dividend which has been declared
and is due to be paid to shareholders.
---------------------------------------------------
Financial Conduct Authority The independent body that regulates the
or financial services industry in the UK.
"FCA"
---------------------------------------------------
Gearing effect The effect of borrowing on a company's returns.
---------------------------------------------------
Index A basket of stocks which is considered to
replicate a particular stock market or sector.
---------------------------------------------------
Investment company A company formed to invest in a diversified
portfolio of assets.
---------------------------------------------------
Investment Trust An investment company which is based in
the UK and which meets certain tax conditions
which enables it to be exempt from UK corporation
tax on its capital gains. The Company is
an investment trust.
---------------------------------------------------
Liquidity The extent to which investments can be sold
at short notice.
---------------------------------------------------
Net assets or net asset An investment company's assets less its
value ('NAV') liabilities
---------------------------------------------------
NAV per Ordinary Share Net assets divided by the number of Ordinary
Shares in issue (excluding any shares held
in treasury)
---------------------------------------------------
Ordinary Shares The Company's ordinary shares in issue.
---------------------------------------------------
Portfolio A collection of different investments held
in order to deliver returns to shareholders
and to spread risk.
---------------------------------------------------
Relative performance Measurement of returns relative to an index.
---------------------------------------------------
Share buyback A purchase of a company's own shares. Shares
can either be bought back for cancellation
or held in treasury.
---------------------------------------------------
Share price The price of a share as determined by a
relevant stock market.
---------------------------------------------------
Treasury shares A company's own shares which are available
to be sold by a company to raise funds.
---------------------------------------------------
Volatility A measure of how much a share moves up and
down in price over a period of time.
---------------------------------------------------
10 Shareholders' Information
Directors, portfolio manager and advisers
Directors Administrator
Perry Wilson Apex Fund Services (Ireland) Limited
Gareth Burchell 2nd Floor, Block 5
John St Agnew Irish Life Centre
Abbey Street Lower
Dublin 1
DO1 P767
Ireland
Registered Office Company Secretary
23(rd) Floor From 1 January 2021
20 Fenchurch Street Throgmorton Secretaries LLP
London EC3M 3BY 6th Floor, 125 Wood Street
England London
EC2V 7AN
Manager and AIFM United Kingdom,
Shard Capital AIFM LLP
23(rd) Floor Upto 31 December 2020
20 Fenchurch Street Apex Fund Services (Ireland) Limited
London EC3M 3BY 2nd Floor, Block 5
England Irish Life Centre
Abbey Street Lower
Placing Agent Dublin 1
Shard Capital Partners LLP DO1 P767
23rd Floor Ireland
20 Fenchurch Street
London EC3M 3BY Registrar
England Computershare Investor Services PLC
The Pavilions, Bridgewater Road
Website Bristol BS99 6ZZ
http://www.sureventuresplc.com England
Depositary
INDOS Financial Limited
27-28 Clements Lane
London EC4N 7AE
United Kingdom
Independent Auditor
Share Identifiers PKF Littlejohn LLP
ISIN: G B 0 0 BYWYZ460 15 Westferry Circus
Sedol: BYWYZ46 Canary Wharf
Ticker: SURE London E14 4HD
England
11 Investment Policy
Investment Policy
Asset allocation
The investment policy of the Company is to seek exposure to
early stage technology companies, with a focus on software-centric
businesses in four chosen target markets:
* Augmented reality and virtual reality (AR/VR)
* Financial technology (FinTech)
* The internet of things (IoT)
* Artificial Intelligence (AI)
The Company may invest directly in investee companies or obtain
exposure to such companies through investment in collective
investment vehicles, including Sure Valley Ventures (the "Fund")
and any further funds, which have investment policies that are
complementary to that of the Company. Investments may be made using
such instruments as the Company in conjunction with Shard Capital
AIFM LLP ("SCAIFM") may determine but are expected to predominantly
comprise equities and equity-linked securities (including shares,
preference shares, convertible debt instruments, payment-in-kind
notes, debentures, warrants and other similar securities) and may
include derivative instruments, contractual rights and other
similar interests that grant the Company rights equivalent or
similar to those conferred by equity and equity-linked
securities.
The Company may implement its investment policy by investing in
class A shares of the Fund and by investing in any further funds
and collective investment vehicles managed by third parties. The
Company will have discretion as to how to make investments,
although it is anticipated that investments in the Fund will
represent between 10 and 100%. of the Company's portfolio at any
given time, and that investments in any further funds and
collective investment vehicles managed by third parties may
similarly constitute a material proportion of the Company's net
asset value subject to the Company's investment restrictions.
Diversification
The Company will seek to hold a diversified portfolio of
investments and, once the assets of the Company, the Fund and any
other collective investment vehicles through which the Company
invests are each fully invested, expects to have a direct or
indirect holding of between 20 and 30 investments. It is intended
that the Company would ordinarily acquire a significant interest,
consisting generally of between 20% and 50% of an investee
company's equity capital. The Company does not envisage taking
management control of a portfolio company other than in exceptional
circumstances and on a temporary basis, and only if it is
considered that such action would be necessary to secure the
interests of the Company. The Company has the option to invest
directly in quoted companies. Furthermore, a portfolio company may
seek a flotation in which case: (i) the Company may continue to
hold such investments without restriction; and (ii) the Company may
make follow-on investments in such portfolio companies.
The Company's investments will not be constrained by
geographical limits. However, it is expected that the Company's
portfolio will predominantly be exposed to companies that have
their principal operations in the UK, Republic of Ireland or
elsewhere in the EEA. In addition, the Company will aim to satisfy
the following guideline criteria for its portfolio:
-- no more than 15% of the Company's NAV in a single investment
no more than 60% of the Company's NAV invested in a further fund or
collective investment vehicle managed by a third party
-- invest in a further fund or collective investment vehicle
managed by a third party only if such further fund or collective
investment vehicle has an investment policy that is consistent with
the investment policy of the Company
-- no investment in companies whose primary business is
acquisition or development of real estate
-- no investments in real estate assets
-- no more than 15% of the Company's NAV to a counterparty in
relation to the utilisation of derivatives (including for
investment and hedging purposes)
Borrowing
The Company may borrow (through bank or other facilities) a
maximum of 20% of net asset value in aggregate (calculated at the
time of borrowing) to seek to enhance returns and for the purpose
of capital flexibility and efficient portfolio management. The
Company's gearing is expected to primarily comprise bank borrowings
but may include the use of derivative instruments and such other
methods as the board may determine. The board will review the
Company's borrowing policy, in conjunction with Shard Capital AIFM
LLP, on a regular basis.
Hedging
Fluctuations in interest rates are influenced by factors outside
the Company's control, and can adversely affect the Company's
results and profitability in a number of ways. The Company's
investment in the Fund will be denominated in euros. The Company
may use derivatives, including forward foreign exchange contracts
and contracts for difference, to seek to hedge against any currency
risk between the currency of the Company's investment in the Fund
and sterling, the base currency of the Company. Shareholders should
note that there is no guarantee that such hedging arrangements will
be utilised or, if so, will be successful.
Cash management
The Company may hold cash on deposit and may invest in cash
equivalent investments, including short-term investments in money
market type funds, tradeable debt securities and government bonds
and securities ("Cash and Cash Equivalents"). There is no
restriction on the amount of Cash and Cash Equivalents that the
Company may hold and there may be times when it is appropriate for
the Company to have a significant cash or cash equivalent position
instead of being fully or near fully invested. In order to
efficiently allocate all of the Company's available funds, the
Company may make short and medium term investments in relatively
liquid assets that are in accordance with the Company's investment
policy ("Liquid Investments"). Such Liquid Investments may include
shares, bonds and other debt instruments issued by companies as
well as shares, units or other interests in collective investment
schemes, other investment funds, exchange traded funds and fixed
income investments. Prior to the full drawdown of the Company's
commitment to the Fund, the cash held by the Company will be
utilised in accordance with the Company's stated investment policy
and cash management policy. The directors, on advice from the
Manager, consider that it is the interests of shareholders for the
cash held by the Company in respect of its commitment to the Fund
to potentially be available for investment in suitable investment
opportunities pending drawdown by the Fund.
Website
The Company's website can be found at
http://www.sureventuresplc.com. The site provides visitors with
Company information and literature downloads.
The Company's profile is also available on third-party sites
such morningstar.co.uk.
Annual report
Copies of the annual report may be obtained from the Company
Secretary or by visiting www.sureventuresplc.com.
Share prices and net asset value information
The Company's ordinary shares of 1p each are quoted on the
London Stock Exchange:
-- SEDOL number: BYWYZ46
-- ISIN number: G B 0 0 BYWYZ460
-- EPIC code: SURE
The codes above may be required to access trading information
relating to the Company on the internet.
Electronic communications with the Company
The Company's Annual Report and Accounts, half-yearly reports
and other formal communications are available on the Company's
website. To reduce costs the Company's half-yearly accounts are not
posted to shareholders but are instead made available on the
Company's website.
Whistleblowing
As the Company has no employees, the Company does not have a
whistleblowing policy. The Audit Committee reviews the
whistleblowing procedures of the manager and administrator to
ensure that the concerns of their staff may be raised in a
confidential manner.
Warning to shareholders - share fraud scams
Fraudsters use persuasive and high-pressure tactics to lure
investors into scams. They may offer to sell shares that turn out
to be worthless or non-existent, or to buy shares at an inflated
price in return for an upfront payment. While high profits are
promised, if you buy or sell shares in this way, you will probably
lose your money.
How to avoid share fraud
-- Keep in mind that firms authorised by the Financial Conduct
Authority are unlikely to contact you out of the blue with an offer
to buy or sell shares
-- Do not get into a conversation, note the name of the person
and firm contacting you and then end the call
-- Check the Financial Services Register from www.fca.org.uk to
see if the person and firm contacting you is authorised by the
Financial Conduct Authority
-- Beware of fraudsters claiming to be from an authorised firm,
copying its website or giving you false contact details
-- Use the firm's contact details listed on the register
maintained by the Financial Conduct Authority if you want to call
it back
-- Call the Financial Conduct Authority on 0800 111 6768 if the
firm does not have contact details on the register or you are told
they are out of date
-- Search the list of unauthorised firms to avoid at www.fca.org.uk/scams
-- Consider that if you buy or sell shares from an unauthorised
firm you will not have access to the Financial Ombudsman Service or
Financial Services Compensation Scheme.
-- Think about getting independent financial and professional
advice before you hand over any money
-- Remember: if it sounds too good to be true, it probably is!
5,000 people contact the Financial Conduct Authority about share
fraud each year, with victims losing an average of GBP20,000.
Report a scam
If you are approached by fraudsters, please tell the FCA using
the share fraud reporting form at fca.org.uk /scams, where you can
find out more about investment scams.
You can also call the FCA Consumer Helpline on 0800 111
6768.
If you have already paid money to share fraudsters, you should
contact Action Fraud on 0300 123 2040.
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END
FR RMMRTMTIJMFB
(END) Dow Jones Newswires
July 30, 2021 04:05 ET (08:05 GMT)
Sure Ventures (LSE:SURE)
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