9 May 2024
Supply@ME Capital
plc
(the
"Company", "Supply@ME" or "SYME" and, together with its
subsidiaries, the "Group")
Independent Auditor's
Report
SYME, the fintech business which
provides an innovative fintech platform (the "Platform") for use by manufacturing and
trading companies to access Inventory Monetisation© ("IM") solutions enabling their
businesses to generate cashflow, following the announcement of and
with reference to its 2023 Annual Report and Accounts provided on
the 1 May 2024, provides the full independent auditor's report
received from its auditors, Crowe U.K. LLP, dated 30 April 2024.
SYME expects to publish the full Annual Report and Accounts on its
website shortly.
Independent auditor's report to the members of Supply@ME
Capital plc
Opinion
We have audited the financial
statements of Supply@ME Capital plc (the "Company") and its subsidiaries (the
"Group") for the year ended
31 December 2023 which comprise the consolidated statement of
comprehensive income, the consolidated and company statements of
financial position, the consolidated and company statements of
changes in equity, the consolidated statement of cashflows and
notes to the financial statements, including significant accounting
policies. The financial reporting framework that has been applied
in the preparation of the group financial statements is applicable
law and UK-adopted international accounting standards. The
financial reporting framework that has been applied in the
preparation of the parent company financial statements is
applicable law and United Kingdom Accounting Standards, including
Financial Reporting Standard 102 The Financial Reporting Standard
applicable in the UK and Republic of Ireland (United Kingdom
Generally Accepted Accounting Practice).
In our opinion:
·
the financial statements give a true and fair view
of the state of the Group's and of the Company's affairs as at 31
December 2023 and of the Group's loss for the year then
ended;
·
the Group financial statements have been properly
prepared in accordance with UK-adopted international accounting
standards;
·
the parent company financial statements have been
properly prepared in accordance with United Kingdom Generally
Accepted Accounting Practice; and
·
the financial statements 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 group and 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.
Material uncertainty relating to going
concern
We draw your attention to note 2
which indicates the existence of uncertainties in relation to
assumptions about future trading and the quantum and timing of
financing transactions that support the going concern basis of
preparation. As stated in note 2, these events or conditions, along
with other matters as set forth in note 2 indicate that a material
uncertainty exists that may cast significant doubt on the Group's
and company's ability to continue as a going concern. Our opinion
is not modified in respect of this matter.
In auditing the financial
statements, we have concluded that the directors' use of the going
concern basis of accounting in the preparation of the financial
statements is appropriate. Our evaluation of the directors'
assessment of the group and company's ability to continue to adopt
the going concern basis of accounting included:
·
we reviewed and challenged the forecast revenues
and agreed, where possible, to underlying term sheets. The
resulting cash flows within the assessment period are uncertain and
this fact is disclosed in note 2;
·
we challenged management over the forecast of cash
inflows from financing activities, the receipt of which the going
concern assumption is reliant on. We removed these cashflows from
the model to ascertain whether they were
material to the model. The reliance on the model to these inflows
and the uncertainty over the quantum and timing are disclosed in
note 2;
·
we tested the mathematical accuracy of the
model;
·
we reviewed forecast cost assumptions having
regard to historic experience and current trading
levels;
·
we agreed the appropriateness of the time period
covered by the assessment; and
·
we reviewed the appropriateness of the disclosure
made and its consistency with our review of the going concern
assessment.
Our responsibilities and the
responsibilities of the directors with respect to going concern are
described in the relevant sections of this report.
Overview of our audit
approach
Materiality
In planning and performing our audit
we applied the concept of materiality. An item is considered
material if it could reasonably be expected to change the economic
decisions of a user of the financial statements. We used the
concept of materiality to both focus our testing and to evaluate
the impact of misstatements identified.
Based on our professional judgement,
we determined overall materiality for the financial statements as a
whole to be £208,000 (2022 £600,000), based on
approximately 5% of the loss before tax for the year. Materiality
for the parent company financial statements as a whole was set at
£190,000 (2022: £310,000) based on 4% of its individual
result.
We use a different level of
materiality ('performance materiality') to determine the extent of
our testing for the audit of the financial statements.
Performance materiality is set based on the audit materiality as
adjusted for the judgements made as to the entity risk and our
evaluation of the specific risk of each audit area having regard to
the internal control environment. We
determined performance materiality to be £124,800 (2022 £360,000) for
the Group and £114,000 (2022: £186,000) for the parent
company. Where considered appropriate
performance materiality may be reduced to a lower level, such as,
for related party transactions and directors'
remuneration.
We agreed with the Audit Committee
to report to it all identified errors in excess of £10,000 (2022:
£7,200). Errors below that threshold would also be reported to it
if, in our opinion as auditor, disclosure was required on
qualitative grounds.
Overview of the
scope of our
audit
As at 31 December 2023, the group
consists of three components, Supply@ME Capital plc, a holding
company based in London, United Kingdom and its trading
subsidiaries, Supply@ME Srl and Supply@ME Technologies Srl both
based in Italy. Supply@ME Capital plc was audited by us and was
conducted from the UK. Audit work on the significant non-UK
components being Supply@ME Srl, and Supply@ME Technologies Srl were
carried out by a member of the Crowe Global network as component
auditor. Limited procedures were performed by a member of the Crowe
Global network on disclosures relating to TradeFlow Capital
Management Pte Ltd, which is based in Singapore, a component which
was disposed of in the year.
In establishing our overall approach
to the Group audit, we determined the type of work that needed to
be undertaken at each of the components by us, as the primary audit
engagement team. For the full scope components in Italy, where the
work was performed by component auditors,
we determined the appropriate level of involvement to enable us
to ensure that sufficient appropriate audit evidence had been
obtained as a basis for our opinion on the Group as a
whole.
The primary team led by the Senior
Statutory Auditor was ultimately responsible for the scope and
direction of the audit process. The primary team, using technology,
interacted regularly with the component teams where appropriate
during various stages of the audit, reviewed working papers
and were responsible for the scope and direction of the audit
process. This, together with the additional procedures
performed at Group level, gave us appropriate evidence for our
opinion on the Group financial statements.
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 year 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.
In addition to the matter described
in the material uncertainty relating to going concern above, we
have determined the matter described below to be the key audit
matter to be communicated in our report.
|
Key
audit matter
|
How
our scope addressed the key audit matter
|
|
Disposal of TradeFlow Capital Management Pte
Ltd
As disclosed in note 26 to the
financial statements, during the year the group disposed of 81%
of TradeFlow Capital Management Pte Ltd.
The conditions for discontinued operations were met and this has
had a pervasive impact across the primary financial statements and
related notes.
In addition, linked to this
transaction, the group was left with a 19% residual interest that
is accounted for at fair value, which is inherently judgmental and
the consideration for the transaction was novated to The
AvanteGarde Group and was not settled by 31 December
2023.
Given the size and importance of the
disposal of TradeFlow Capital Management Pte Ltd and the additional
accounting considerations that arose this was a key area of focus
for our audit.
|
To assess the adequacy of the
accounting for the presentation as Assets held for sale and
Discontinued operations:
·
We agreed the sale transaction to the signed share
purchase agreement, noting the key terms.
·
We reviewed the disclosures having regard to the
requirements of IFRS 5.
·
We considered the criteria for significant
influence to exist which could impact the accounting for the
residual interest.
·
We challenged managements calculation of the Fair
value of the residual interest at the disposal and reporting date
and a downward fair value adjustment was recorded following our
challenge.
·
We performed specified procedures on the result of
the entity prior to disposal and the assets and liabilities at the
disposal date.
·
We recalculated the associated gain on disposal,
including agreeing the consideration to the share purchase
agreement and agreeing the net assets disposed to supporting
documentation.
·
We assessed the recoverability of the
consideration receivable.
Key
observation:
We concluded that the accounting for
the sale of TradeFlow Capital Management Pte Ltd was
appropriate.
|
Our audit procedures in relation to
these matters were designed in the context of our audit opinion as
a whole. They were not designed to enable us to express an opinion
on these matters individually and we express no such
opinion.
Other information
The 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 contained within the annual
report.
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. 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 course of 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 this gives rise to 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.
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 our audit
·
the information given in the strategic report and
the directors' report for the financial year for which the
financial statements are prepared is consistent with the financial
statements; and
·
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 Group and the Company and their 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 by
the company, or returns adequate for our audit have not been
received from branches not visited by us; or
·
the company 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; or
·
we have not received all the information and
explanations we require for our audit.
Responsibilities of the
directors for the
financial statements
As explained more fully in the
statement of directors' responsibilities set out on page 114, 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 Group's
and the parent 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 Group or the parent 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:
·
enquiry of management and those charged with
governance about the Company's policies, procedures and related
controls regarding compliance with laws and regulations and if
there are any known instances of non-compliance; the laws and
regulations we considered in this context were relevant company law
and taxation legislation;
·
examining supporting documents for all material
balances, transactions and disclosures;
·
review of the Board of directors and the Audit
Committee minutes;
·
enquiry of management about litigations and claims
and inspection of relevant correspondence;
·
evaluation of the selection and application of
accounting policies related to subjective measurements and complex
transactions;
·
analytical procedures to identify any unusual or
unexpected relationships;
·
testing the appropriateness of journal entries
recorded in the general ledger and other adjustments made in the
preparation of the financial statements;
·
review of accounting estimates for biases;
and
·
Communications with component auditors to request
identification of any instances of non-compliance with laws and
regulations that could give rise to a material misstatement of the
group financial statements.
Owing to the inherent limitations of
an audit, there is an unavoidable risk that some material
misstatements of the financial statements may not be detected, even
though the audit is properly planned and performed in accordance
with the ISAs (UK). The potential effects of inherent limitations
are particularly significant in the case of misstatement resulting
from fraud because fraud may involve sophisticated and carefully
organized schemes designed to conceal it, including deliberate
failure to record transactions, collusion or intentional
misrepresentations being made to us.
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 management on
22 September 2020 to audit the financial statements for the period
ending 31 December 2019. Our total uninterrupted period of
engagement is 5 years, covering the periods ending 31 December 2019
to 31 December 2023.
The non-audit services prohibited by
the FRC's Ethical Standard were not provided to the group or the
company and we remain independent of the group and the company in
conducting our audit.
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.
Leo Malkin
Senior Statutory Auditor
For and on behalf of
Crowe U.K. LLP
Statutory Auditor
London
30 April 2024
Contact information
Alessandro Zamboni, CEO, Supply@ME
Capital plc, investors@supplymecapital.com
Notes
SYME and its operating subsidiaries
provide its Platform for use by manufacturing and trading companies
to access inventory trade solutions enabling their businesses to
generate cashflow, via a non-credit approach and without incurring
debt. This is achieved by their existing eligible inventory
being added to the Platform and then monetised via purchase by
third party Inventory Funders. The inventory to be monetised
can include warehoused goods waiting to be sold to end-customers or
goods that are part of a typical import/export
transaction.