TIDMTAU
RNS Number : 5712D
Tau Capital PLC
27 June 2019
27 June 2019
TAU CAPITAL PLC
(the "Company" or "Tau")
Final Results
Tau Capital Plc ("Tau" or the "Company"), today announces its
financial results for the year to 31 December 2018.
A copy of the Company's annual report and accounts for the year
to 31 December 2018 (the "Annual Report and Accounts") will be
posted to shareholders tomorrow and the Annual Report and Accounts
will be available from the Company's website,
www.taucapitalplc.com, shortly.
Trading in the Company's ordinary shares will remain suspended
until the completion of a Reverse Takeover, which requires the
publication of an admission document and the approval of such a
transaction at a general meeting of the Company, or the Company is
re-admitted to trading on AIM as an investing company under the AIM
Rules (which requires the raising of at least GBP6,000,000). If no
such transaction is completed within six months of the date of the
suspension, the Company's shares will be cancelled from trading on
AIM pursuant to AIM Rule 41.
For further information, please contact:
FIM Capital Limited
Philip Scales +44 (0) 1624 681250
Allenby Capital Limited (Nominated Adviser and Joint-Broker)
John Depasquale / Alex Brearley +44 203 328 5656
Peterhouse Corporate Finance Limited (Joint-Broker)
Lucy Williams / Eran Zucker +44 207 469 0933
Chairman's Statement
Since the last Chairman's Statement reported in the June 2018
Interim Financial Statements, there has been some significant
changes in the Company. On 8 April 2019, the Company held an
Extraordinary General Meeting at which it was agreed that
amendments be made to the Articles of Association, the denomination
of the share capital be changed, and that further new ordinary
shares be issued following a successful Placing undertaken by
Peterhouse Capital Limited. A distribution of US$1,186,000,
equivalent to US$0.0242 per share was also made to shareholders on
record at 5 April 2019 and, on 12 April 2019, Philip Lambert and
Terry Mahoney resigned from the Board and Nigel Burton and I were
appointed.
On 18 October 2018, the previous Board of the Company announced
that the disposal of its final asset, an indirect interest in
Stopharm LLP, had completed and under AIM Rule 15, the Company was
then classified as a cash shell. The result of this was that the
Company was required, within six months to make an acquisition
which constitutes a reverse takeover under AIM Rule 14 or be
re-admitted to trading on AIM as an investing company, failing
which the Company's ordinary shares would be suspended. The
Company's ordinary shares were suspended on 23 April 2019 and the
Company now has up to six months from the date of suspension of the
Company's ordinary shares to complete a reverse takeover or be
readmitted to trading on AIM as an investing company or the
Company's shares will be cancelled from trading on AIM pursuant to
AIM Rule 41.
Your Board is now working hard on identifying appropriate
targets as well as considering other options.
Philip Scales has remained as a Director and Company Secretary
of the Company and FIM Capital are continuing as Administrator. In
addition, Peterhouse Capital Limited remain as joint broker along
with Allenby Capital Limited who also remain as the Company's AIM
nominated advisor.
Meanwhile your Board is exercising tight control on expenditure
and looks forward to updating you as matters progress over the
course of the next few months.
Gerwyn Williams
Chairman
26 June 2019
Directors' Report
The Directors have pleasure in presenting the annual report and
audited financial statements of Tau Capital Plc (the "Company") for
the year ended 31 December 2018.
Principal activity and incorporation
The Company was incorporated in the Isle of Man on 3 April 2007
for the purpose of investing in public and private businesses that
are established in, operating in or have exposure to Kazakhstan and
neighbouring countries. The Company's ordinary shares were admitted
to trading on AIM on 3 May 2007.
On 25 July 2012, following the approval by shareholders, the
Company restated its Investing Policy and committed to realising
assets and distributing net proceeds as soon as practicable to
shareholders, subject to retaining sufficient cash to meet current
and future liabilities.
The Company disposed of all public equity investments during
2014.
On 18 October 2018, the Company completed the disposal of its
indirect interest in Stopharm LLP (see note 3).
The Company is now looking for opportunities for a reverse
takeover ("RTO") under AIM rule 14. Pending the completion of an
RTO, the Company's ordinary shares were suspended on 23 April
2019.
Results and dividends
The Company's results for the financial year ended 31 December
2018 are set out in the Statement of Comprehensive Income.
A review of the Company's activities is set out in the
Chairman's Statement.
The Directors do not recommend the payment of a final dividend
for the year ended 31 December 2018 (31 December 2017: US$ Nil),
leaving a loss of US$457,610 (31 December 2017: US$5,336,713 loss)
to be transferred from reserves.
A distribution of US$1,186,000, equivalent to US$0.0242 per
share was declared and paid subsequent to the financial year end,
see note 13.
Subsequent Events
Subsequent events have been detailed in note 13.
Going concern
On 12 April 2019, the Company made a distribution to
shareholders on record at 5 April 2019. On 9 April 2019 the Company
completed a Placing of ordinary shares to raise US$150,000. Funds
were retained to allow the Company to meet its on-going expenses
until October 2019, at which point the future of the Company will
be reconsidered by the Board (see note 2n). The Company was
initially established as an investment vehicle. In the current year
it disposed of its last investment and distributed the proceeds.
This resulted in the Company ceasing trade of its principal
activity and on that basis prepared the financial statements on a
basis other than of a going concern.
The Financial Statements have therefore been presented on a
non-going concern basis, which assumes that the Company will be
placed into liquidation, following the delisting of the Company's
ordinary shares, should an RTO not be completed or be readmitted to
trading on AIM as an investing company by the relevant date in
October 2019.
Directors
The Directors of the Company during the year and to the date of
this report were as follows:
Appointed Resigned
Philip Scales 3 April 2007
Gerwyn Williams 12 April 2019
Nigel Burton 12 April 2019
Philip Lambert 11 April 2007 12 April 2019
Terence Mahony 24 July 2012 12 April 2019
Directors' interests in the shares of the Company at 31 December
2018 are detailed in note 6.
Changes were made to the composition of the Board subsequent to
the financial year end, see note 13.
Company Secretary
The Secretary of the Company during the year ended 31 December
2018 and to the date of this report was Philip Scales.
Auditors
Deloitte LLP, being eligible, has indicated its willingness to
continue in office.
Approved on behalf of the Board of Directors
Gerwyn Williams Philip Scales
26 June 2019
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report
and financial statements in accordance with applicable Isle of Man
law and regulations.
Isle of Man company law requires the Directors to prepare
financial statements for each financial year. Under that law the
Directors have elected to prepare the financial statements in
accordance with International Financial Reporting Standards (IFRS)
as adopted by the European Union. Under company law, the Directors
must not approve the financial statements unless they are satisfied
that they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that period.
In preparing these financial statements, International Accounting
Standard 1 requires that Directors:
-- properly select and apply accounting policies;
-- present information, including accounting policies, in a
manner that provides relevant, reliable, comparable and
understandable information;
-- provide additional disclosures when compliance with the
specific requirements in IFRS are insufficient to enable users to
understand the impact of particular transactions, other events and
conditions on the Company's financial position and financial
performance; and
-- make an assessment of the Company's ability to continue as a going concern.
The Directors are responsible for keeping proper accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the financial statements comply with the Isle of Man Companies Act
2006. They are also responsible for the system of internal control,
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 corporate and financial information included on the
Company's website. Legislation in the Isle of Man governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
Corporate Governance Statement
The Board of Tau Capital Plc has adopted the Quoted Companies
Alliance 2018 Corporate Governance Code (the "QCA Code").
The Company is committed to the highest standards of corporate
governance, ethical practices and regulatory compliance. In
particular, the Board is committed to ensuring that the Company is
governed in a manner to allow efficient and effective decision
making, with robust risk management procedures.
As an AIM Rule 15 cash shell, the Company is reliant upon its
service providers for many of its operations and as such will
maintain an ongoing and rigorous review of these providers.
The Company's compliance with the QCA Code is on the Company's
website (www.taucapital.com). The Company will provide annual
updates on changes to compliance with the QCA Code.
Independent Auditor's Report to the Members of Tau Capital
Plc
Report on the audit of the financial statements
Opinion
In our opinion the financial statements of Tau Capital Plc (the
'Company'):
-- give a true and fair view of the state of the Company's
affairs as at 31 December 2018 and of its loss for the year then
ended;
-- have been properly prepared in accordance with International
Financial Reporting Standards (IFRSs) as adopted by the European
Union; and
-- have been prepared in accordance with the requirements of the
Isle of Man Companies Act 2006.
We have audited the financial statements which comprise:
-- the statement of comprehensive income;
-- the statement of financial position;
-- the statement of changes in equity;
-- the cash flow statement;
-- the related notes 1 to 13.
The financial reporting framework that has been applied in their
preparation is applicable law and IFRSs as adopted by the European
Union.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs(UK)) and applicable law. Our
responsibilities under those standards are further described in the
auditor's responsibilities for the audit of the financial
statements section of our report.
We are independent of the Company in accordance with the ethical
requirements that are relevant to our audit of the financial
statements in the UK, including the FRC's Ethical Standard, 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.
Emphasis of matter - financial statements prepared other than on
a going concern basis
We draw attention to note 2(n) in the financial statements,
which indicates that the financial statements have been prepared on
a basis other than that of a going concern. Our opinion is not
modified in respect of this matter.
Summary of our audit approach
Key audit matters
The key audit matter that we identified in the current year
were:
Net gain on financial assets at fair value through profit and
loss.
Materiality
The materiality that we used in the current year was US$40,200
which was determined on the basis of 3% of equity.
Scoping
The Company consisted of investments in a subsidiary and an
indirect investment in a subsidiary which held a level 3
investment. The level 3 investment was sold in the current year
resulting in one subsidiary being liquidated during the financial
year and the other post year end. We have identified the group and
performed risk assessment to identify areas of risk. Procedures
were tailored to address these risks.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) that we identified. These matters included those which had
the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the
engagement team.
These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these
matters.
In addition to the matter described in the going concern
section, we have determined matters to be communicated in our
report.
Net gain on financial assets at fair value through profit and
loss
Key audit matter description
The Company held one investment during the period through an
indirect subsidiary. The investment was disposed of during the year
following a significant impairment in the prior year. The
investment was not listed and classified as a level 3 investment on
the fair value hierarchy. Management had actively sought to dispose
of the investment for a number of years.
The Directors of the Company had estimated that the total fair
value of the direct and indirect subsidiaries in the prior year
based upon net assets, which was affected by the valuation of the
underlying private investment owned by the subsidiary. In the prior
year the entity revised their investment valuation following a post
year end sale agreement of the investment valued at US$1,100,000
based on agreed sale price, net of costs. In the current year this
sale was completed for Tenge 443,850,000 (US$1,202,512). Excess
cash following the sale of the underlying investment were
transferred through the group to the Company.
Following the disposal and related intercompany loan write-off,
the direct subsidiary was liquidated on 20 December 2018 and the
indirect subsidiary which held the investment began liquidation
proceedings with a net asset value of Nil at year end, formally
liquidating on 3 January 2019.
Following the settlement of expenses within the subsidiaries and
subsequent intercompany loan write-offs the Company realised a gain
on investment in subsidiaries of US$45,050. We therefore identified
a key audit matter related to the risk that the net gain was
incorrectly calculated due to the complexity of the disposal
transactions.
How the scope of our audit responded to the key audit matter
An evaluation of the design and implementation of the controls
over the recognition of realised gains and losses on investment in
subsidiaries was performed. An understanding of the gains/losses on
investment in subsidiaries methodology and underlying data was
obtained and further corroborated through supporting evidence.
We reviewed the sale agreement and receipt of cash consideration
into the Company's bank account and agreed this through to the net
gain on financial assets at fair value through profit or loss
calculations. We have also reviewed the transfer of sale proceeds
and cash via intercompany loan through the group subsidiaries to
the Company and the subsequent loan write-off which occurred when
liquidation proceedings occurred. These amounts have also been
agreed through to the minutes of the meetings of the Company's
Directors.
We considered the adequacy of the disclosure in note 3 to the
financial statement concerning the realised gain on investment in
subsidiary, particularly as regards to the accuracy of the
calculation.
Key observations
The realised gain on investment in subsidiaries disclosed in the
financial statement for the year ended 31 December 2018 appears to
be reasonable and in line with our substantive testing.
Our application of materiality
We define materiality as the magnitude of misstatement in the
financial statements that makes it probable that the economic
decisions of a reasonably knowledgeable person would be changed or
influenced. We use materiality both in planning the scope of our
audit work and in evaluating the results of our work.
Based on our professional judgement, we determined materiality
for the financial statements as a whole as follows:
Materiality US$40,200 (2017: US$54,000).
Basis for determining materiality 3% of equity (2017: prior year
3% of equity).
As a result of the decrease in subsidiary NAV prior to
intercompany loan write off and subsequent liquidation proceedings,
the equity balance has reduced significantly since the prior
year.
Rationale for the benchmark applied
The Company disposed of its single external investment in the
year, the Company is not 'income' generating and is in run-off thus
profit before tax is an inappropriate measure. As the Company is
no-longer a going concern, equity is the key balance within the
entity and thus we have chosen to use equity as our basis for
materiality.
We agreed with the Directors that we would report to them all
audit differences in excess of US$2,000 (2017: US$3,100), as well
as differences below that threshold that, in our view, warranted
reporting on qualitative grounds. We also report to the Directors
on disclosure matters that we identified when assessing the overall
presentation of the financial statements.
An overview of the scope of our audit
The audit was scoped by obtaining an understanding of the entity
and its environment, including internal controls and assessing the
risks of material misstatement.
As the Company was an investment entity we conducted the audit
through direct communication with the service provider. Assessment
of the service provider was performed including design and
implementation of internal controls over the financial reporting
process.
Other information
The Directors are responsible for the other information. The
other information comprises the information included in the annual
report, other than the financial statements and our auditor's
report thereon.
Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance conclusion
thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated.
If we identify such material inconsistencies or apparent
material misstatements, we are required to determine whether there
is a material misstatement in the financial statements or a
material misstatement of the other information. If, based on the
work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report
that fact.
We have nothing to report in respect of these matters.
Responsibilities of Directors
As explained more fully in the Directors' responsibilities
statement, the Directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true
and fair view, and for such internal control as the Directors
determine is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the Directors are
responsible for assessing the Company's ability to continue as a
going concern, disclosing as applicable, matters related to going
concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Company or to cease
operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
A further description of our responsibilities for the audit of
the financial statements is located on the FRC's website at:
www.frc.org.uk/auditorsresponsibilities. This description forms
part of our auditor's report.
Use of our report
This report is made solely for the exclusive use of the
Directors for the purpose of showing the results of management's
stewardship of the resources entrusted to it. Our report is not to
be used for any other purpose, rectified or referred to in any
document, copied or made available (in whole or in part) to any
other person without prior express consent. We accept no duty,
responsibility or liability to any other party in connections with
the report or this engagement.
Deloitte LLP
Isle of Man
Statement of Comprehensive Income
Year ended Year ended
31 Dec
31 Dec 2018 2017
Note US$ US$
Investment income
Interest income 7 7
Net gain/(loss) on financial
assets at fair value through
profit or loss 3 45,050 (4,966,852)
Total operating gain/(loss) 45,057 (4,966,845)
------------- ------------
Expenses
Operating expenses 7 (502,667) (369,868)
(502,667) (369,868)
Loss before tax (457,610) (5,336,713)
Taxation 8 - -
Loss for the year - -
Other comprehensive income - -
Total comprehensive loss for
the year attributable to the
shareholders (457,610) (5,336,713)
------------- ------------
Basic and diluted loss per share 12 ($0.01) ($0.11)
------------- ------------
All results derive from discontinued operations.
In both the current and prior years, there was no other
comprehensive income other than that dealt with above.
The accompanying notes form an integral part of these financial
statements.
Statement of Financial Position
As at As at
31 Dec 2018 31 Dec 2017
Note US$ US$
Assets
Current assets
Investment in subsidiaries 3 - 2,566,593
Loans to subsidiaries 5 - 111,574
Debtors and prepayments 22,224 15,143
Cash and cash equivalents 1,407,341 69,784
------------ ------------
Total assets 1,429,565 2,763,094
------------ ------------
Liabilities
Current liabilities
Creditors and accruals (63,808) (90,133)
Loan from subsidiaries 5 - (849,594)
Total liabilities (63,808) (939,727)
------------ ------------
Total current and net assets 1,365,757 1,823,367
============ ============
Shareholders' equity
Share capital 4 976,209 976,209
Distributable reserves 389,548 847,158
------------ ------------
Total shareholders' equity 1,365,757 1,823,367
============ ============
Net Asset Value per share $0.03 $0.04
------------ ------------
The accompanying notes form an integral part of these financial
statements.
Approved by the Board of Directors and signed on its behalf
by:
Gerwyn Williams Philip Scales
26 June 2019
Statement of Changes in Equity for the year ended 31 December
2018
Share Distributable
capital reserves Total
US$ US$ US$
Balance at 1 January 2018 976,209 847,158 1,823,367
Total comprehensive loss for
the year - (457,610) (457,610)
Balance at 31 December 2018 976,209 389,548 1,365,757
======== ============== ==========
Share Distributable
capital reserves Total
US$ US$ US$
Balance at 1 January 2017 976,209 6,183,871 7,160,080
Total comprehensive loss for
the year - (5,336,713) (5,336,713)
-------- -------------- ------------
Balance at 31 December 2017 976,209 847,158 1,823,367
========
Statement of Cash Flows
Year ended Year ended
31 Dec 2018 31 Dec 2017
US$ US$
Cash flows from operating activities
Loss for the year (457,610) (5,336,713)
Adjustments to reconcile loss for
the year to net cash provided by
operating activities:
Net (gain)/loss on financial assets
at fair value through profit or
loss (45,050) 4,966,852
Working capital adjustments:
Increase in debtors and prepayments (7,081) (113)
Decrease in creditors and accruals (26,325) (18,743)
------------ ------------
(536,066) (388,717)
Proceeds from the disposal of Stopharm 1,202,512 -
Receipts of payments from subsidiaries 671,111 367,154
------------ ------------
Net cash generated from/(used in)
operating activities 1,337,557 (21,563)
------------ ------------
Net increase/(decrease) in cash
and cash equivalents 1,337,557 (21,563)
Cash and cash equivalents at the
beginning of year 69,784 91,347
Cash and cash equivalents at the
end of year 1,407,341 69,784
============ ============
Notes to the Financial Statements for the year ended 31 December
2018
1. General
Tau Capital Plc (the "Company") is a closed-ended investment
company domiciled in the Isle of Man since 3 April 2007. The
Company was incorporated under the Isle of Man Companies Acts
1931-2004. Following approval at the AGM held on 24 July 2012, the
Company was re-registered under the Isle of Man Companies Act 2006
with registered number 008604V. The Company's ordinary shares are
admitted to trading on AIM, a market of that name operated by the
London Stock Exchange. The Company has no employees.
On 18 October 2018, the Company completed the disposal of the
Company's indirect interest in Stopharm LLP ("Stopharm") (see note
3). The direct subsidiary Tau (Cayman) L.P., is the intermediate
parent of Tau SPV 1 Cooperatief WA ("Tau SPV 1"), which holds no
private investments (31 December 2017: one) as at the year end
date. On 23 April 2019 trading of the Company's ordinary shares on
the AIM was suspended, see note 13.
2. Accounting Policies
The significant accounting policies and estimation techniques
adopted by the Company for the year ended 31 December 2018 are
consistent with those adopted by the Company for the annual
financial statements for the year ended 31 December 2017, with the
exception of those disclosed below.
a) Basis of Preparation
The financial statements are presented in US dollars. The
functional currency is also the US dollar. All references to net
assets throughout this document refer to net assets attributable to
holders of ordinary shares unless otherwise stated.
b) Standards and amendments which are first effective for the period beginning 1 January 2018
A number of new standards are effective from 1 January 2018 but
other than detailed below, they do not have a material effect on
the Company's financial statements.
IFRS 15 Revenue from Contracts with customers: Recognition and
Measurement ("IFRS 15") was effective from 1 January 2018. The
application of this standard has no impact on the Company or any
comparative disclosures.
The Company has applied IFRS 9 Financial Instruments:
Recognition and Measurement ("IFRS 9") from 1 January 2018. No
restatement of comparative information was required from the
adoption of this new accounting standard. IFRS 9 sets out
requirements for recognising and measuring financial assets. This
standard replaces IAS 39 Financial Instruments: Recognition and
Measurement ("IAS 39").
As a result of the adoption of IFRS 9, the Company has adopted
consequential amendments to IFRS:
- impairment of financial assets to be presented in a separate
line item in the Statement of Comprehensive Income; and
- separate presentation in the Statement of Comprehensive Income
of interest revenue calculated using the effective interest method.
Previously the Company disclosed this amount in the notes to the
financial statements.
Additionally, the Company has adopted consequential amendments
to IFRS 7 Financial Instruments: Disclosures, which are applied to
disclosures about the current financial year but have not generally
been applied to comparative information.
Under IAS 39, cash and cash equivalents and receivables were
classified as loans and receivables. Under IFRS 9 these are
classified as measured at amortised cost. Under IAS 39, equity
instruments were classified as at fair value through profit or loss
on initial recognition. Under IFRS 9 these are classified as
mandatorily at fair value through profit or loss.
IFRS 9 replaces the 'incurred loss' model in IAS 39 with an
'expected credit loss' ("ECL") model. The new impairment model
applies to financial assets measured at amortised cost and debt
investments at fair value through other comprehensive income, but
not to investments in equity instruments. Under IFRS 9, credit
losses are recognised earlier than under IAS 39. The Company held
no material financial assets at the financial year end on which the
ECL model would result in a material difference on the carrying
value.
Impairment on cash and cash equivalents and receivables have
been measured on a 12-month ECL basis and reflects the short
maturities of the exposures. The Company considers that these
exposures have low credit risk based on the external credit ratings
of the counterparties. The Company monitors changes in credit risk
on these exposures by tracking published external credit ratings of
the counterparties. 12-month and lifetime probabilities of default
are based on this data.
c) Financial instruments (new accounting policy under IFRS 9)
i) Recognition and initial measurement
The Company initially recognises financial assets at fair value
through profit or loss ("FVTPL") on the trade date, which is the
date on which the Company becomes a party to the contractual
provisions of the instrument. Other financial assets are recognised
on the date on which they are originated.
A financial asset is measured initially at fair value plus, for
an item not at FVTPL, transaction costs that are directly
attributable to its acquisition or issue.
ii) Classification and subsequent measurement
Classification of financial assets and liabilities
On initial recognition, the Company classifies financial assets
as measured at amortised cost or FVTPL.
A financial asset is measured at amortised cost if it meets both
the following conditions and is not designated as at FVTPL.
- it is held within a business model whose objective is to hold
assets to collect contractual cash flows; and
- its contractual terms give rise on specified dates to cash
flows that are solely payment of principal and interest
("SPPI").
All other financial assets of the Company are measured at
FVTPL.
Financial liabilities are classified as measured at amortised
cost or FVTPL.
A financial liability is classified as at FVTPL if it is
classified as held-for-trading or it is designated as such on
initial recognition. Financial liabilities at FVTPL are measured at
fair value and net gains and losses, including any interest
expense, are recognised in profit or loss.
Other financial liabilities are subsequently measured at
amortised cost using the effective interest method. Interest
expense and foreign exchange gains and losses are recognised in
profit or loss. Any gain or loss on derecognition is also
recognised in profit or loss.
Financial liabilities at amortised cost includes creditors and
accruals.
New standards and interpretations issued but not effective
A number of new standards and amendments to standards are
effective for annual periods beginning after 1 January 2019 and
earlier application is permitted. Two new standards potentially
relevant to the Company are IFRS 16 Leases and IFRS 17 Insurance
contracts. Application of either of these standards is not expected
to have an impact on the Company.
iii) Amortised cost measurement
The 'amortised cost' of a financial asset or financial liability
is the amount at which the financial asset or financial liability
is measured on initial recognition minus the principal repayments,
plus or minus the cumulative amortisation using the effective
interest method of any difference between that initial amount and
the maturity amount and, for financial assets, adjusted for any
loss allowance.
Business model assessment
In making an assessment of the objective of the business model
in which a financial asset is held, the Company considers all of
the relevant information about how the business is managed,
including:
- the documented investment strategy and the execution of this
strategy in practice. This includes realising cash flows through
the sale of assets;
- how the performance of the portfolio is evaluated and reported
to the Company's management; and
- the risks that affect the performance of the business model
(and the financial assets held within that business model) and how
those risks are managed.
Transfers of financial assets to third parties in transactions
that do not qualify for derecognition are not considered sales for
this purpose, consistent with the Company's continuing recognition
of the assets.
The Company has determined that it has two business models.
- Held-to-collect business model: this includes cash and cash
equivalents and receivables. These financial assets are held to
collect contractual cash flow.
- Other business model: this includes equity investments. These
financial assets are managed and their performance is evaluated, on
a fair value basis.
Assessment whether contractual cash flows are SPPI
For the purposes of this assessment, 'principal' is defined as
the fair value of the financial asset on initial recognition.
'Interest' is defined as consideration for the time value of money
and for the credit risk associated with the principal amount
outstanding during a particular period of time and for other basic
lending risks and costs (e.g. liquidity risk and administrative
costs), as well as a profit margin.
In assessing whether the contractual cash flows are SPPI, the
Company considers the contractual terms of the instrument. This
includes assessing whether the financial asset contains a
contractual term that could change the timing or amount of
contractual cash flows such that it would not meet this condition.
In making this assessment, the Company considers:
- contingent events that would change the amount or timing of cash flows;
- leverage features;
- prepayment and extension features;
- terms that limit the Company's claim to cash flows from
specified assets (e.g. non-recourse features); and
- features that modify consideration of the time value of money
(e.g. periodical reset of interest rates).
Reclassifications
Financial assets are not reclassified subsequent to their
initial recognition unless the Company were to change its business
model for managing financial assets, in which case all affected
financial assets would be reclassified on the first day of the
first reporting period following the change in the business
model.
Subsequent measurement of financial assets
Financial assets at FVTPL
These assets are subsequently measured at fair value. Net gains
and losses, including foreign exchange gains and losses, are
recognised in the Statement of Comprehensive Income.
Equity investments are included in this category.
Financial assets at amortised cost (2018: loans and
receivables)
These assets are subsequently measured at amortised cost using
the effective interest method. Interest income is recognised in
'interest income calculated using the effective interest method',
foreign exchange gains and losses are recognised in 'net foreign
exchange loss' and impairment is recognised in 'impairment losses
on financial instruments' in the Statement of Comprehensive Income.
Any gain or loss on derecognition is also recognised in profit or
loss.
Cash and cash equivalents and receivables are included in this
category.
iii) Amortised cost measurement
The 'amortised cost' of a financial asset is the amount at which
the financial asset is measured on initial recognition minus the
principal repayments, plus or minus the cumulative amortisation
using the effective interest method of any difference between that
initial amount and the maturity amount and, for financial assets,
adjusted for any loss allowance.
d) Interest (new accounting policy under IFRS 9)
Interest income and expense presented in the Statement of
Comprehensive Income comprise interest on financial assets measured
at amortised cost calculated on an effective interest basis. The
'effective interest rate' is the rate that exactly discounts
estimated future cash payments or receipts through the expected
life of the financial instrument to the gross carrying amount of
the financial asset.
In calculating interest income, the effective interest rate is
applied to the gross carrying amount of the asset (when the asset
is not credit-impaired). However, for financial assets that have
become credit-impaired subsequent to initial recognition, interest
income is calculated by applying the effective interest rate to the
amortised cost of the financial asset. If the asset is no longer
credit-impaired, then the calculation of interest income reverts to
the gross basis.
e) Statement of compliance
The annual financial statements of the Company are prepared in
accordance with International Financial Reporting Standards
("IFRS"), as adopted by the European Union and applicable legal and
regulatory requirements of Isle of Man law and the AIM Rules for
Companies of the London Stock Exchange.
f) Segment reporting
IFRS 8 requires operating segments to be identified on the basis
of internal reports about components of the Company that are
regularly reviewed by the Board of Directors in order to allocate
resources to the segment and assess its performance.
The Directors are of the opinion that over the year ended 31
December 2018, the Company was engaged in a single segment of
business, being investment business, in one geographical area,
being Kazakhstan.
g) Taxation
Current tax is provided at amounts expected to be paid (or
recovered) using the tax rates and laws that have been enacted, or
substantially enacted at the end of the financial year.
h) Expenses
All expenses are recognised in the Statement of Comprehensive
Income on an accruals basis.
i) Offsetting financial instruments
Financial assets and liabilities are offset and the net amount
reported in the Statement of Financial Position when there is a
legally enforceable right to offset the recognised amounts and
there is an intention to settle on a net basis, or realise the
asset and settle the liability simultaneously.
j) Foreign currency translation
i) Functional and presentation currency
Items included in the Company's financial statements are
measured and presented using the currency of the primary economic
environment in which it operates (the "functional currency"). This
is the US dollar, which reflects that the results of the Company
subsidiaries and private equity investment are presented in US
dollars.
ii) Foreign currency transactions
Monetary assets and liabilities and financial instruments
categorised as at fair value through profit or loss, denominated in
currencies other than the US dollar are translated into US dollars
at the closing rates of exchange at the date of the Statement of
Financial Position. Transactions during the year are translated at
the rate of exchange prevailing on the date of the transaction.
Foreign currency transaction gains and losses are included in
realised and unrealised gains and losses on financial assets and
liabilities designated at fair value through profit or loss.
k) Cash and cash equivalents
Cash and cash equivalents comprise of cash balances with a
maturity date of up to three months from the date of acquisition.
They are short-term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to
insignificant changes in value and are held for the purpose of
meeting short-term cash commitments rather than for investment or
other purposes.
l) Share capital
The Company's founder shares are classified as equity in
accordance with the Company's Articles of Association.
Ordinary shares are classified as equity. Incremental costs
attributable to the issue of new shares are shown in equity as a
deduction from the proceeds.
m) Critical accounting judgements and key sources of estimation
uncertainty
Critical judgements in applying the Company's accounting
policies
In assessing whether it meets the definition of an investment
entity, the Company must consider whether it has the typical
characteristics of an investment entity. The Company has been
deemed to meet the definition of an investment entity per IFRS 10
Consolidated Financial Statements as the following conditions
exist:
- The Company obtains funds from one or more investors for the
purpose of providing those investors with investment management
services;
- The Company commits to its investors that its business purpose
is to invest funds solely for returns from capital appreciation,
investment income or both;
- The Company measures and evaluates the performance of all of
its investments on a fair value basis; and
- The Company's investors are not a related party of the entity.
Key sources of estimation uncertainty
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates and
assumptions. It also requires the Board of Directors to exercise
its judgement in the process of applying the Company's accounting
policies. Key estimates, assumptions and judgements that have
significant risk of causing material adjustment to the carrying
amount of assets and liabilities within the next financial year are
outlined below.
Going concern
Following the liquidation of all subsidiaries as detailed in
note 3 and the suspension of trading of the Company's ordinary
shares on the AIM the Board have made an assessment of the
Company's going concern. In light of this, the financial statements
have been presented on a non-going concern basis.
n) Going concern
The Company's business activities, together with the factors
likely to affect its future development, performance and positions
are set out in the Chairman's Statement.
Following the liquidation of all subsidiaries as detailed in
note 3 and subsequent to 31 December 2018, the Company made a
distribution to shareholders and completed a Placing of ordinary
shares to raise US$150,000. Funds were retained to allow the
Company to meet its on-going expenses until October 2019, at which
point the future of the Company will be reconsidered by the
Board.
In light of this, the financial statements have been presented
on a non-going concern basis. The assets of the Company have been
stated at realisable value. The Company will continue running up
until 18 October 2019, by which time it is expected that either the
Board will arrange for a further capital raise or a liquidator of
the Company will be appointed following the delisting of the
Company's ordinary shares from trading on AIM.
3. Investment in Subsidiaries
The Company held the following investments in subsidiaries
during the financial year:
Principal investment
Name Country of incorporation activity Ownership interest
--------------------------
Tau (Cayman)
L.P.* Cayman Islands Investment holding 100%
Tau Cayman Ltd** Cayman Islands Administration 100%
------------------ -------------------------- ----------------------- -------------------
*Dissolved on 20 December 2018.
**Placed in liquidation 6 December 2018, dissolved on 31 January
2019.
Tau (Cayman) L.P. in turn held the following investment in a
subsidiary during the financial year:
Principal investment Ownership
Name Country of incorporation activity interest
----------------------
Tau SPV 1 * The Netherlands Investment holding 99%
------------- -------------------------- ----------------------
* Placed in liquidation 26 October 2018, dissolved on 3 January
2019.
On 18 October 2018, the Company completed the disposal of the
Company's indirect interest in Stopharm.
The fair values of the subsidiaries of the Company at 31
December 2018 and 31 December 2017 were as follows:
31 December
2018 31 December 2017
US$ US$
Tau (Cayman) L.P. (including its subsidiary
TAU SPV 1) - 2,566,593
Tau Cayman Limited - -
The Company classifies its investment in subsidiaries in
accordance with IFRS 9 and values its investment in subsidiaries in
accordance with IFRS 13 - Fair Value Measurements ("IFRS 13"). IFRS
13 defines fair value and establishes a framework for measuring
fair value.
Financial instruments included in each category are as
follows:
Level 1 - Quoted market price
Level 2 - Market observable inputs
Level 3 - Non-market observable inputs
All financial instruments recorded at fair value for the current
and prior financial year were measured using non-market observable
inputs (level 3).
The following is a reconciliation of the movement in financial
assets for which non-market observable inputs (level 3) were used
to determine fair value as at 31 December 2018 and 31 December
2017:
31 Dec 2018 31 Dec 2017
US$ US$
Opening balance at beginning of year 2,566,593 7,533,445
Opening loan balances netted off investments (738,020) -
--------------- ---------------
Net loans and investments 1,828,573 7,533,445
Receipts of payments from subsidiaries (671,111) -
Proceeds from the disposal of Stopharm (1,202,512) -
Net gain/(loss) on financial assets at
fair value through profit or loss 45,050 (4,966,852)
--------------- ---------------
(1,828,573) (4,966,852)
Closing balance at end of year - 2,566,593
--------------- ---------------
During the financial year the one remaining Group investment was
disposed of and the proceeds and the remaining assets were
transferred through to the group via the intercompany loan
balances. Previously the intercompany balances were included in the
value of investments in subsidiaries and after the disposal of
Stopharm, the subsidiaries were subsequently dissolved/liquidated
and the outstanding balances were written off once all
proceeds/cash was transferred to the Company. Therefore, the net
related party balances were included in the calculation of the net
gain on disposal in the current year.
Net gains/(losses) on investments is recognised as investment
income in the Statement of Comprehensive Income. There were no
transfers out of level 3 during the year (2017: none).
Fair value of the Company's level 3 financial assets that are
measured at fair value on a recurring basis
All of the Company's financial assets are measured at fair value
at the end of each reporting period. The following table gives
information about how the fair values of these financial assets are
determined (in particular, the valuation techniques and inputs
used).
Financial Fair value as Fair Valuation Significant unobservable Relationship
assets at value techniques input of unobservable
31 December 2018 hierarchy & key inputs to
inputs fair value
Investment 100% of investments Level Estimated At the year end The higher
in subsidiaries in direct and 3 recovery no realisable the valuation
indirect subsidiaries: value assets or liabilities of realisable
nil (2017: US$2,566,593) remained in any assets the
of the subsidiaries. higher the
fair value.
-------------------------- ----------- ------------ ------------------------- -----------------
If the value of unlisted private company investments held by Tau
SPV 1 were 10 per cent higher/lower while all the other variables
were held constant, the carrying amount of the investment held
would increase/decrease by US$ Nil (2017: US$110,000). Tau Cayman
Limited has no assets or liabilities and a fair value of US$ Nil
(2017: US$ Nil). A sensitivity analysis to changes in assumptions
has therefore not been prepared in respect of the investment in Tau
Cayman Limited.
Tau (Cayman) L.P.
The fair value of Tau (Cayman) L.P. was based on its net assets
including its investment in Tau SPV 1 as follows:
31 Dec 2018 31 Dec 2017
US$ US$
Cash - 756,461
Debtors and prepayments - 5,950
Loan to group - 849,594
Investment in subsidiary - Tau
SPV 1 - 1,079,772
Total assets - 2,691,777
Loan from group - (125,184)
Total liabilities - (125,184)
Total net assets - 2,566,593
------------ ------------
The total net assets of Tau (Cayman) L.P. included a loan to the
Company of nil (2017: US$849,594) for the payment of operating
expenses of the Company. The loan had no fixed payment terms and is
payable on demand (note 5).
Tau SPV 1- direct subsidiary of Tau (Cayman) L.P. and indirect
subsidiary of the Company
The fair value of Tau SPV 1 was based on its net assets as
follows:
31 Dec 2018 31 Dec 2017
US$ US$
Cash - 3,425
Financial assets at fair value
through profit or loss - 1,100,000
Total assets - 1,103,425
Accounts payable and accrued expenses - (23,652)
Total liabilities - (23,652)
Total net assets - 1,079,722
------------ ------------
At the year end, the investment portfolio of financial assets at
fair value through profit or loss held by the direct and indirect
subsidiaries of the Company comprised nil investments (31 December
2017: one investment).
Stopharm
Stopharm is a wholesale pharmaceuticals distributor operating in
Kazakhstan of which Tau SPV1 held 40.35 per cent of the equity. On
18 October 2018 the Company completed the disposal of the Company's
indirect interest in Stopharm. The receipt of sale proceeds by Tau
SPV1 has been accounted for through the movement in the fair value
of the Company's intercompany loans (see note 5), therefore no
realised gains or losses have been recognised by the Company in
respect of this transaction. The sale of Stopharm includes an
undertaking that should the Buyer transfer the holding in Stopharm
within 12 months of the closing date of the Share Purchase
Agreement, they will pay 25% of any excess consideration received
to the Company.
4. Share Capital
The authorised share capital of the Company is GBP3,502,000
comprising 350,199,998 ordinary shares of GBP0.01 each and two
founder shares of GBP0.01 each. The founder shares carry identical
rights and privileges to the ordinary shares of the Company which
includes a right to receive all dividends and other distributions
declared, made or paid. The share capital of the Company has been
allocated, called up and fully paid. The ordinary shares in issue
as at 31 December 2018 and 31 December 2017 were 48,984,680, the
founder shares in issue as at 31 December 2018 and 31 December 2017
were two. For changes in share capital subsequent to the year end
see note 13.
5. Loans to and from subsidiaries
During the year the Company received net funds from Tau (Cayman)
L.P. US$671,111. As at 31 December 2018, the Company held a net
balance due to Tau (Cayman) L.P. of US$1,409,131 (2017:
US$783,020). On 20 December 2018 the General Partner and Limited
Partner of Tau (Cayman) L.P. resolved to write off the loan balance
due from the Company. At 31 December 2018 the final loan balance
was US$ nil.
6. Related party items
Philip Scales is a Director of the Company and is the deputy
chairman of FIM Capital Limited, the Company's administrator (the
"Administrator").
As at 31 December 2018, Philip Lambert, a Director of the
Company, held 101,201 ordinary shares in the Company (31 December
2017, Philip Lambert held 101,201 ordinary shares in the
Company).
As at 31 December 2018, Terence Mahony, a Director of the
Company, held 102,424 ordinary shares (31 December 2017:
102,424).
On 12 April 2019, both Philip Lambert and Terence Mahony
resigned as Directors and Gerwyn Williams and Nigel Burton were
appointed to the Board (see note 13).
As at 31 December 2018, Richard Horlick, a previous Director of
the Company who was retained after his retirement on 1 January 2014
to act in a consultant capacity, held 12,684,221 ordinary shares
(31 December 2017: 12,684,221). Global Asset Tracking, a company to
whom Richard Horlick provides consultancy services, received fees
of GBP GBP47,000 from the Company during the financial year (31
December 2017: GBP GBP48,000).
7. Operating expenses
Included within operating expenses are the Directors'
remunerations, which are shown below:
31 Dec 2018 31 Dec 2017
US$ US$
Philip Lambert 39,744 39,365
Terence Mahony 26,892 26,186
Philip Scales 15,864 15,746
Total Directors' remuneration 82,500 81,297
------------ ------------
During the year ended 31 December 2018, none of the Directors
received any additional cash or non-cash benefits (year ended 31
December 2017: nil). During the year ended 31 December 2018, none
of the Directors held any share options or participated in any
long-term incentive plans (year ended 31 December 2017: nil).
During the year ended 31 December 2018, the Company did not make
any contributions to a pension scheme in respect of any of the
Directors (year ended 31 December 2017: nil).
Administrator fees
The Administrator is entitled to receive a fixed fee of
GBP35,000 per annum payable quarterly in arrears. The Administrator
is also entitled to receive an additional fixed fee of US$35,000
per annum payable quarterly in arrears for the provision of
accounting services.
The administration fee for the year ended 31 December 2018
amounted to US$91,154 (31 December 2017: US$91,539).
Audit fees
The auditors are entitled to an audit fee of GBP15,000 (31
December 2017: GBP25,000).
8. Taxation
The Company is resident for tax purposes in the Isle of Man and
its profits are subject to Isle of Man Corporate Income Tax at the
current rate of 0% (31 December 2017: 0%).
9. Financial instruments and associated Risks
Introduction
In accordance with the Company's accounting policy for
investment in subsidiaries (note 2c) these are designated at fair
value through profit or loss.
Risk is inherent in the Company's activities but is managed
through a process of ongoing identification, measurement and
monitoring, subject to risk limits and other controls. The process
of risk management is critical to the Company's continuing
existence. The Company is exposed to market risk (which includes
currency risk, interest rate risk and other price risk), credit
risk and liquidity risk arising from the financial instruments it
holds.
Risk management structure
The Board of Directors is ultimately responsible for identifying
and controlling risks and it monitors risks on an ongoing basis in
relation to the direct and indirect subsidiaries investments in the
private investments.
Risk measurement and reporting system
The Board of Directors assess the size and type of risks the
Company is exposed to.
Monitoring and controlling risks is primarily performed based on
limits established by the Board. These limits reflect the business
strategy and market environment of the Company as well as the level
of risk that the Company is willing to accept. In addition, the
Company monitors and measures the overall risk bearing capacity in
relation to the aggregate risk exposure across all risk types and
activities.
Risk mitigation
The Company has investment guidelines that set out its overall
business strategies, its tolerance for risk and its general risk
management philosophy.
Excessive risk concentration
Concentration arises when a number of counterparties are engaged
in similar business activities, or activities in the same
geographic region, or have similar economic features that would
cause their ability to meet contractual obligations to be similarly
affected by changes in economic, political or other conditions.
Concentration indicates the relative sensitivity of the Company's
performance to developments affecting a particular industry or
geographical location.
Capital risk
The Company manages its capital to ensure it is able to continue
as a going concern while maximising the return to shareholders
through the optimisation of the debt and equity balance. The
capital structure of the Company consists of loans from
subsidiaries (note 5) and equity, comprising share capital (note 4)
and distribution reserves.
The Company is not subject to any externally imposed capital
requirements.
Market risk
Market risk is the risk that the fair value, or future cash
flows of a financial instrument, will fluctuate because of changes
in market prices and includes interest rate risk, foreign currency
risk and "other price risks", such as equity and commodity
risk.
The Company's strategy on the management of investment risk is
driven by its investment objective as outlined in note 1 to the
financial statements.
Equity price and private investment risk
Equity price risk is the risk that the fair values of equities
decrease as a result of changes in the levels of equity indices and
the value of individual stocks. The equity and private investment
price risk exposure arises from the Company's direct and indirect
subsidiaries investment portfolio which is monitored by the Board
of Directors.
Currency risk
Currency risk is the risk that the value of a financial
instrument will fluctuate due to changes in foreign exchange rates.
The Company invests in assets denominated in currencies other than
its presentation currency, the US dollar. Consequently, the Company
is exposed to risks that the exchange rate of the US dollar,
relative to other currencies, may change in a manner which has an
adverse effect on the reported value of that portion of the
Company's assets which is denominated in currencies other than the
US dollar.
The Company's overall currency risk is monitored on a quarterly
basis by the Board of Directors during Board meetings.
At 31 December 2018 the Company's exposure to foreign currency
was as follows:
Financial Cash & cash Other assets
assets equivalents & liabilities Total
US$ US$ US$ US$
Euro - 322 - 322
Pound sterling 22,224 3,592 (99,519) (73,703)
22,224 3,914 (99,519) (73,381)
---------- ------------- --------------- ---------
At 31 December 2017 the Company's exposure to foreign currency
was as follows:
Financial Cash & cash Other assets
assets equivalents & liabilities Total
US$ US$ US$ US$
Euro - 841 - 841
Pound sterling 15,143 66,116 (50,700) 30,559
15,143 66,957 (50,700) 31,400
---------- ------------- --------------- --------
The following analysis discloses management's best estimate of
the effect of a reasonably possible movement in currency rates
against the US dollar, with all other variables held constant. A
negative amount in the table reflects a potential net reduction in
total comprehensive income or net assets, while a positive amount
reflects a net potential increase.
As at 31 December 2018:
Financial Cash & cash Other assets Effect on
assets equivalents & liabilities net assets
% change US$ US$ US$ US$
Euro 10% increase - 32 - 32
Pound sterling 10% increase 2,222 359 (9,952) (7,371)
2,222 391 (9,952) (7,339)
---------- ------------- --------------- ------------
As at 31 December 2017:
Financial Cash & cash Other assets Effect on
assets equivalents & liabilities net assets
% change US$ US$ US$ US$
Euro 10% increase - 84 - 84
Pound sterling 10% increase 1,514 6,612 (5,070) 3,056
1,514 6,696 (5,070) 3,140
---------- ------------- --------------- ------------
In practice the actual trading results may differ from this
change and the difference could be material.
Interest rate risk
The majority of the Company's financial assets are non-interest
bearing. As a result, the Company is not subject to significant
amounts of risk due to fluctuations in the prevailing levels of
market interest rates. Any excess cash and cash equivalents are
invested at short-term market interest rates.
Liquidity risk
Liquidity risk is the risk that the Company will encounter
difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another
financial asset.
The Company tries to ensure that as far as possible, it will
always have sufficient liquidity to meet its liabilities when due,
under both normal and stress conditions, without incurring
unacceptable losses or risking damage to the Company's reputation
or financial integrity.
The Company's liquidity is managed on a daily basis by the
Administrator.
As at 31 December 2018, the Company held no net assets in its
subsidiaries or private investments (31 December 2017: US$1,100,000
which represented 60.3% of the Company's net assets).
The table below analyses the Company's liabilities as at 31
December 2018 and 31 December 2017 into relevant maturity groupings
based on the remaining period at the date of the Statement of
Financial Position to the contractual maturity date. The amounts in
the table are the contractual undiscounted cash flows. Balances due
within 12 months equal their carrying balances as the impact of
discounting is not significant.
Less than 1
As at 31 December 2018: month 1-6 months
US$ US$
Creditors and accruals (63,608) -
(63,608) -
------------ -----------
Less than 1
As at 31 December 2017: month 1-6 months
US$ US$
Creditors and accruals (90,132) -
Loan from subsidiaries (849,594) -
(939,726) -
------------ -----------
Credit risk
Credit risk is the risk that a counterparty to a financial
instrument will fail to discharge an obligation or commitment that
it has entered into with the Company resulting in a financial loss
to the Company. It is the Company's policy to enter into financial
instruments with a range of reputable counterparties. Therefore,
the Company does not expect to incur material credit losses on its
financial instruments.
The Company's only credit risk is in relation to holding cash
and cash equivalents which are deposited with Barclays Bank Plc. At
the date when these financial statements were released Barclays
Bank Plc had a Standard and Poor's short term credit rating of
A-1.
Private investments risk
This is the risk that the fair value of financial instruments
will fluctuate as a result of changes in market prices (other than
those arising from interest rate risk or currency risk), whether
caused by factors specific to the individual investment or its
issuer or factors affecting the market in general.
The Company is no longer exposed to other price risk after the
disposal of Stopharm during the financial year (see note 3).
10. Exchange Rates
The following exchange rates were used to translate assets and
liabilities into US dollars at 31 December 2018 and 31 December
2017:
31 Dec 2018 31 Dec 2017
Euro 1.1467 1.20046
Pound sterling 1.2754 1.35127
11. Distributions
Subject to the provisions of the Articles, the Company may by
ordinary resolution, declare that out of profits available for
distribution, in accordance with Isle of Man law, dividends be paid
to members according to their respective rights and interests in
the profits of the Company. However, no dividend shall exceed the
amount recommended by the Board. There is no fixed date on which an
entitlement to dividend arises.
No dividends were declared or paid during the year ended 31
December 2018 and 31 December 2017. A distribution was made
subsequent to the year end (note 13).
12. Basic and diluted loss per share
Basic and diluted loss per share is calculated by dividing the
net profit or loss attributable to shareholders by the weighted
average number of ordinary shares outstanding during the year.
Year ended Year ended
31 Dec 2018 31 Dec 2017
Net loss attributable to
shareholders (US$457,610) (US$5,336,713)
Weighted average number of
ordinary shares in issue 48,984,680 48,984,680
Basic loss per share ($0.01) ($0.11)
There is no difference between the fully diluted earnings per
share and basic earnings per share.
13. Events after the reporting date
On 31 January 2019 Tau Cayman Ltd was dissolved.
On 8 April 2019 the Company held an Extraordinary General
Meeting ("EGM") at which three resolutions were passed that have
led to the changes detailed below:
- to approve the redenomination of each ordinary share of
GBP0.01 par value in the capital of the Company as an ordinary
share of no par value in the capital of the Company;
- to approve the alteration of the Company's Articles' as
described in the EGM notice dated 15 March 2019; and
- to authorise the Directors of the Company to allot New
Ordinary Shares for cash as if pre-emption rights did not
apply.
On 9 April 2019 the Company allotted and admitted to AIM
150,000,000 ordinary shares with one voting right each, raising
gross proceeds of US$150,000, via a placing.
On 12 April 2019 both Philip Lambert and Terence Mahony resigned
as Directors and Gerwyn Williams and Nigel Burton were appointed to
the Board. Gerwyn Williams was also appointed Chairman.
On 12 April 2019 the Company made a distribution of
US$1,186,000, equivalent to US$0.0242 per share to ordinary
shareholders on record at 5 April 2019.
On 23 April 2019 trading of the Company's ordinary shares on the
AIM was suspended. Trading in the Company's ordinary shares will
remain suspended until the completion of a Reverse Takeover, which
requires the publication of an admission document and the approval
of such a transaction at a general meeting of the Company, or the
Company is re-admitted to trading on AIM as an investing company
under the AIM Rules (which requires the raising of at least
GBPGBP6,000,000). If no such transaction is completed within six
months of the suspension the Company's shares will be cancelled
from trading on AIM pursuant to AIM Rule 41.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR PGUACQUPBPUQ
(END) Dow Jones Newswires
June 27, 2019 02:01 ET (06:01 GMT)
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