Interim / Quarterly Report • Sep 29, 2017
Interim / Quarterly Report
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REPORT AND FINANCIAL STATEMENTS Period from 1 January 2017 to 30 June 2017
| Board of Directors and other officers | |
|---|---|
| Management Report | $\overline{2}$ |
| Statement of profit or loss and other comprehensive income | 3 |
| Statement of financial position | $\overline{4}$ |
| Statement of changes in equity | 5 |
| Cash flow statement | 6 |
| Notes to the financial statements | $7 - 23$ |
PAGE
| Board of Directors: | Alexandros Sinos Serapheim Charalampidis Panagiotis Brouskaris Stephanos Kazantzis Evangelos Drympetas Gloria Chrysafi |
|---|---|
| Company Secretary: | Gloria Chrysafi |
| Independent Auditors: | C&N AUDITORS LTD Certified Public Accountants 10 Yianni Kranidioti 1065 Nicosia |
| Registered office: | Andrea Kalvou 5 Elladio Building, Flat 201 3085, Limassol |
| Bankers: | Pireos Bank (Greece) Alpha Bank (Greece) Hellenic Bank Public Company Ltd Eurobank Cyprus Ltd |
Registration number:
HE 304867
The Board of Directors presents its report and audited financial statements of the Company for the period from 1 January 2017 to 30 June 2017.
The Company is a Cyprus Investment Firm ("C.I.F") and in accordance with the license no.177/12 granted by the Cyprus Securities and Exchange Commission ("CySEC") on 4 September 2012.
The principal activities of the company comprise the provision of investment services, including reception and transmission of orders in relation to one or more financial instruments and execution of orders on behalf of clients in relation to one or more financial instruments.
In addition, the Company provides ancillary services, which comprise the safekeeping and administration of financial instruments, including custondianship and related services, advice to undertakings on capital structure, industrial strategy and related matters and advice and services related to mergers and the purchase of undertakings, foreign exchange services where these are connected to the provision of investment services, services related to underwriting, and investment services and activities as well as ancillary services where these are connected to the provision of investment or ancillary services.
The Company's development to date, financial results and position as presented in the financial statements are considered satisfactory.
The Company's results for the period are set out on page 3. The Board of Directors, following consideration of the availability of profits for distribution as well as the liquidity position of the Company, does not recommend the payment of a dividend and the net profit for the period is retained.
There were no changes in the share capital of the Company during the period under review.
The members of the Company's Board of Directors as at 30 June 2017 and at the date of this report are presented on page 1. All of them were members of the Board of Directors throughout the period from 1 January 2017 to 30 June 2017.
In accordance with the Company's Articles of Association all Directors presently members of the Board continue in office.
There were no significant changes in the assignment of responsibilities and remuneration of the Board of Directors.
By order of the Board of Directors,
Gloria Chrysafi
Secretary
Nicosia, 25 September 2017
| Note | $01/01/2017-3$ 0/06/2017 € |
2016 € |
|
|---|---|---|---|
| Revenue Cost of sales |
56 | 391.362 (202.881) |
737.549 (393.290) |
| Gross profit | 188.481 | 344.259 | |
| Other operating income Selling and distribution expenses Administration expenses Other expenses |
7 8 9 10 |
3.711 (10.746) (131.338) (48) |
9.561 (8.566) (308.980) (1.032) |
| Operating profit | 50.060 | 35.242 | |
| Finance costs | 12 | (4.779) | (8.305) |
| Profit before tax | 45.281 | 26.937 | |
| Net profit for the period/year | 45.281 | 26,937 |
| 2017 | 2016 | ||
|---|---|---|---|
| ASSETS | Note | € | € |
| Non-current assets | |||
| Property, plant and equipment | 14 | 47.493 | 47.493 |
| Intangible assets | 15 | 3.415 | 3.415 |
| Investments in subsidiaries | 16 | 2.000 | |
| Investors Compensation Fund | 19 | 73.056 | 73.056 |
| 125.964 | 123.964 | ||
| Current assets | |||
| Trade and other receivables/Clients | 17 | 4.510.825 | 1.444.022 |
| Other investments (own) | 18 | 33.480 | 33.480 |
| Cash at bank and in hand | 20 | 90.935 | 223.197 |
| 4.635.240 | 1.700.699 | ||
| Total assets | 4.761.204 | 1.824.663 | |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Share capital | 21 | 600.000 | 600,000 |
| Accumulated losses | (163.265) | (208.546) | |
| Total equity | 436.735 | 391.454 | |
| Current liabilities | |||
| Trade and other payables/Clients | 22 | 4.324.469 | 1.433.209 |
| 4.324.469 | 1.433.209 | ||
| Total equity and liabilities | 4.761.204 | 1.824.663 |
On 25 September 2017 the Board of Directors of AEONIC SECURITIES C.I.F. PLC authorised these financial statements for issue.
Francesco . . . . . . . .
Alexandros Sinos Director
Seraphem Charalampidis
| Share capital € |
Accumula-t ed losses € |
Total € |
|
|---|---|---|---|
| Balance at 1 January 2016 | 600,000 | (235.483) | 364.517 |
| Comprehensive income Net profit for the year |
26.937 | 26.937 | |
| Transactions with owners | |||
| Balance at 31 December 2016 | 600,000 | (208.546) | 391.454 |
| Balance at 31 December 2016/ 1 January 2017 | 600,000 | (208.546) | 391.454 |
| Comprehensive income Net profit for the period |
45.281 | 45.281 | |
| Balance at 30 June 2017 | 600,000 | (163.265) | 436.735 |
Companies which do not distribute 70% of their profits after tax, as defined by the relevant tax law, within two years after the end of the relevant tax year, will be deemed to have distributed as dividends 70% of these profits. Special contribution for defence at 17% will be payable on such deemed dividends to the extent that the ultimate shareholders are both Cyprus tax resident and Cyprus domiciled. The amount of deemed distribution is reduced by any actual dividends paid out of the profits of the relevant year at any time. This special contribution for defence is payable by the Company for the account of the shareholders.
Period from 1 January 2017 to 30 June 2017
| $01/01/2017-3$ 0/06/2017 |
2016 | ||
|---|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES | Note | € | € |
| Profit before tax Adjustments for: |
45.281 | 26.937 | |
| Depreciation of property, plant and equipment Unrealised exchange profit |
14 | (1.918) | 12.450 (1.269) |
| Amortisation of computer software | 15 | 3.869 | |
| Interest income Interest expense |
$\overline{7}$ 12 |
(99) 47 |
(1.518) |
| 43.311 | 40.470 | ||
| Changes in working capital: Increase in trade and other receivables Increase in trade and other payables |
(3.066.803) 2.891.260 |
(136.246) 80.464 |
|
| Cash used in operations | (132.232) | (15.312) | |
| CASH FLOWS FROM INVESTING ACTIVITIES | |||
| Payment for purchase of property, plant and equipment Payment for purchase of investments in subsidiaries Payment for purchase of other investments |
14 16 18 |
(2.000) | (19.982) (33.480) |
| Interest received | 99 | 1.518 | |
| Net cash used in investing activities | (1.901) | (51.944) | |
| CASH FLOWS FROM FINANCING ACTIVITIES | |||
| Unrealised exchange profit Interest paid |
1.918 (47) |
1.269 (1) |
|
| Net cash generated from financing activities | 1.871 | 1.268 | |
| Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of the period/year |
(132.262) 223.197 |
(65.988) 289.185 |
|
| Cash and cash equivalents at end of the period/year | 20 | 90.935 | 223.197 |
The Company AEONIC SECURITIES C.I.F. PLC (the "Company") was incorporated in Cyprus on 19th of April 2012 as a private limited liability company under the provisions of the Cyprus Companies Law, Cap. 113. On 18th of December 2015, the Company changed from being a private limited liability company to public limited company. Its registered office is at Andrea Kalvou 5, Elladio Building, Flat 201, 3085, Limassol.
The Company is a Cyprus Investment Firm ("C.I.F") and in accordance with the license no.177/12 granted by the Cyprus Securities and Exchange Commission ("CySEC") on 4 September 2012.
The principal activities of the company comprise the provision of investment services, including reception and transmission of orders in relation to one or more financial instruments and execution of orders on behalf of clients in relation to one or more financial instruments.
In addition, the Company provides ancillary services, which comprise the safekeeping and administration of financial instruments, including custondianship and related services, advice to undertakings on capital structure, industrial strategy and related matters and advice and services related to mergers and the purchase of undertakings, foreign exchange services where these are connected to the provision of investment services, services related to underwriting, and investment services and activities as well as ancillary services where these are connected to the provision of investment or ancillary services.
The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented in these financial statements unless otherwise stated.
The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and the requirements of the Cyprus Companies Law, Cap. 113.
The Company is not required by the Cyprus Companies Law, Cap.113, to prepare consolidated financial statements because the Company and its subsidiaries constitute a medium sized group as defined by the Law and the Company does not intend to issue consolidated financial statements for the period from 1 January 2017 to 30 June 2017.
The European Union has concluded that since its 4th Directive requires parent companies to prepare separate financial statements, and since the Cyprus Companies Law, Cap. 113, requires the preparation of such financial statements in accordance with IFRS as adopted by the European Union, the provisions of International Financial Reporting Standard 10 'Consolidated Financial Statements' that require the preparation of consolidated financial statements in accordance with IFRS do not apply.
The financial statements have been prepared under the historical cost convention.
The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates and requires Management to exercise its judgment in the process of applying the Company's accounting policies. It also requires the use of assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on Management's best knowledge of current events and actions, actual results may ultimately differ from those estimates.
During the current period the Company adopted all the new and revised International Financial Reporting Standards (IFRS) that are relevant to its operations and are effective for accounting periods beginning on 1 January 2017. This adoption did not have a material effect on the accounting policies of the Company.
At the date of approval of these financial statements, standards and interpretations were issued by the International Accounting Standards Board which were not yet effective. Some of them were adopted by the European Union and others not yet. The Board of Directors expects that the adoption of these accounting standards in future periods will not have a material effect on the financial statements of the Company.
Subsidiaries are entities controlled by the Company. Control exists where the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
Investments in subsidiary companies are stated at cost less provision for impairment in value, which is recognised as an expense in the period in which the impairment is identified.
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable products provided in the normal course of business, net of discounts and sales related taxes. Revenues earned by the Company are recognised on the following bases:
Sales of products are recognised when significant risks and rewards of ownership of the products have been transferred to the customer, which is usually when the Company has sold or delivered the products to the customer, the customer has accepted the products and collectability of the related receivable is reasonably assured.
Sales of services are recognised in the accounting period in which the services are rendered by reference to completion of the specific transaction assessed on the basis of the actual service provided as a proportion of the total services to be provided.
Dividend from investments in securities is recognised when the right to receive payment is established. Withheld taxes are transferred to profit or loss. Interest from investments in securities is recognised on an accruals basis.
Profits or losses from the sale of investments in securities represent the difference between the net proceeds and the carrying amount of the investments sold and is transferred to profit or loss.
The difference between the fair value of investments at fair value through profit or loss as at 30 June 2017 and the mid cost price represents unrealised gains and losses and is included in profit or loss in the period in which it arises. Unrealised gains and losses arising from changes in the fair value of available-for-sale financial assets are recognised in equity. When available-for-sale financial assets are sold or impaired, the accumulated fair value adjustments are included in profit or loss as fair value gains or losses on investments, taking into account any amounts charged or credited to profit or loss in previous periods.
Commission income is recognised when the right to receive payment is established.
Interest income is recognised on a time-proportion basis using the effective interest method.
The Company and its employees contribute to the Government Social Insurance Fund based on employees' salaries. The Company's contributions are expensed as incurred and are included in staff costs. The Company has no legal or constructive obligations to pay further contributions if the scheme does not hold sufficient assets to pay all employees benefits relating to employee service in the current and prior periods.
Interest expense and other borrowing costs are charged to profit or loss as incurred.
Items included in the Company's financial statements are measured using the currency of the primary economic environment in which the entity operates ('the functional currency'). The financial statements are presented in Euro $(\epsilon)$ , which is the Company's functional and presentation currency.
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Translation differences on non-monetary items such as equities held at fair value through profit or loss are reported as part of the fair value gain or loss.
Current tax liabilities and assets are measured at the amount expected to be paid to or recovered from the taxation authorities, using the tax rates and laws that have been enacted, or substantively enacted, by the reporting date.
Property, plant and equipment are stated at historical cost less accumulated depreciation and any accumulated impairment losses.
Depreciation is calculated on the straight-line method so as to write off the cost of each asset to its residual value over its estimated useful life. The annual depreciation rates used are as follows:
| $\frac{9}{2}$ | |
|---|---|
| Motor vehicles | |
| Furniture, fixtures and office equipment | |
| Computer Software | 33,33 |
The assets residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
Where the carrying amount of an asset is greater than its estimated recoverable amount, the asset is written down immediately to its recoverable amount.
Expenditure for repairs and maintenance of property, plant and equipment is charged to profit or loss of the year in which it is incurred. The cost of major renovations and other subsequent expenditure are included in the carrying amount of the asset when it is probable that future economic benefits in excess of the originally assessed standard of performance of the existing asset will flow to the Company. Major renovations are depreciated over the remaining useful life of the related asset.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. Internally generated intangible assets, excluding capitalised development costs, are not capitalised and expenditure is reflected in profit or loss in the year in which the expenditure is incurred. The useful lives of intangible assets are assessed to be either finite or indefinite.
Intangible assets with finite lives are amortised over the useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life is reviewed at least at each financial year end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset is accounted for by changing the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in profit or loss in the expense category consistent with the function of the intangible asset.
Intangible assets with indefinite useful lives are tested for impairment annually either individually or at the cash generating unit level. Such intangibles are not amortised. The useful life of an intangible asset with an indefinite life is reviewed annually to determine whether indefinite life assessment continues to be supportable. If not, the change in the useful life assessment from indefinite to finite is made on a prospective basis.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is derecognised.
Costs that are directly associated with identifiable and unique computer software products controlled by the Company and that will probably generate economic benefits exceeding costs beyond one year are recognised as intangible assets. Subsequently computer software is carried at cost less any accumulated amortisation and any accumulated impairment losses. Expenditure which enhances or extends the performance of computer software programs beyond their original specifications is recognised as a capital improvement and added to the original cost of the computer software. Costs associated with maintenance of computer software programs are recognised as an expense when incurred. Computer software costs are amortised using the straight-line method over their useful lives, not exceeding a period of three years. Amortisation commences when the computer software is available for USP.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset, are recognised in profit or loss when the asset is derecognised.
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to depreciation or amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).
Financial assets and financial liabilities are recognised in the Company's statement of financial position when the Company becomes a party to the contractual provisions of the instrument.
Trade receivables are measured at initial recognition at fair value and are subsequently measured at amortised cost using the effective interest rate method. Appropriate allowances for estimated irrecoverable amounts are recognised in profit or loss when there is objective evidence that the asset is impaired. The allowance recognised is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows discounted at the effective interest rate computed at initial recognition.
The Company classifies its financial assets in the following categories: financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments and available for-sale financial assets. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of financial assets at initial recognition.
Regular way purchases and sales of financial assets are recognised on trade-date which is the date on which the Company commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially recognised at fair value and transaction costs are expensed in profit or loss. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all risks and rewards of ownership. Loans and receivables are carried at amortised cost using the effective interest method.
Gains or losses arising from changes in the fair value of the "financial assets at fair value through profit or loss" category are presented in profit or loss in the period in which they arise. Dividend income from financial assets at fair value through profit or loss is recognised in the profit or loss when the Company's right to receive payments is established.
The fair values of quoted investments are based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the Company establishes fair value by using valuation techniques. These include the use of recent arm's length transactions, reference to other instruments that are substantially the same and discounted cash flow analysis, making maximum use of market inputs and relying as little as possible on entity specific inputs. Equity investments for which fair values cannot be measured reliably are recognised at cost less impairment.
Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale are analysed between translation differences resulting from changes in amortised cost of the security and other changes in the carrying amount of the security. The translation differences on monetary securities are recognised in profit or loss, while translation differences on non-monetary securities are recognised in other comprehensive income. Changes in the fair value of monetary and non-monetary securities classified as available-for-sale are recognised in other comprehensive income.
When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments recognised in other comprehensive income are included in profit or loss as gains and losses on available-for-sale financial assets.
Interest on available-for-sale securities calculated using the effective interest method is recognised in the profit or loss. Dividends on available-for-sale equity instruments are recognised in profit or loss when the Company's right to receive payments is established.
The Company assesses at each reporting date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity securities classified as available for sale, a significant or prolonged decline in the fair value of the security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available-for-sale financial assets the cumulative loss which is measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss, is removed from equity and recognised in profit or loss.
For financial assets measured at amortised cost, if in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.
In respect of available for sale equity securities, impairment losses previously recognised in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognised in other comprehensive income and accumulated under the heading of investments revaluation reserve. In respect of available for sale debt securities, impairment losses are subsequently reversed through profit or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss.
For the purpose of the cash flow statement, cash and cash equivalents comprise cash at bank and in hand.
Trade payables are initially measured at fair value and are subsequently measured at amortised cost, using the effective interest rate method.
A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is derecognised when:
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.
Financial assets and financial liabilities are offset and the net amount reported in the statement of financial position if, and only if, there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the asset and settle the liability simultaneously. This is not generally the case with master netting agreements, and the related assets and liabilities are presented gross in the statement of financial position.
Ordinary shares are classified as equity.
Where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year.
The Company is exposed to interest rate risk, credit risk, liquidity risk, currency risk and capital risk management arising from the financial instruments it holds. The risk management policies employed by the Company to manage these risks are discussed below:
Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest rates. The Company's income and operating cash flows are substantially independent of changes in market interest rates as the Company has no significant interest-bearing assets. The Company is exposed to interest rate risk in relation to its non-current borrowings. Borrowings issued at variable rates expose the Company to cash flow interest rate risk. Borrowings issued at fixed rates expose the Company to fair value interest rate risk. The Company's management monitors the interest rate fluctuations on a continuous basis and acts accordingly.
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company does not provide margin accounts or offers any form of credit to its clients and especially for large accounts, the BoD has decided to employ the Delivery Versus Payment method (DVP) thus eliminating credit or counterparty risk.
Liquidity risk is the risk that arises when the maturity of assets and liabilities does not match. An unmatched position potentially enhances profitability, but can also increase the risk of losses. The Company has procedures with the object of minimising such losses such as maintaining sufficient cash and other highly liquid current assets and by having available an adequate amount of committed credit facilities.
Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates. Currency risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the Company's measurement currency. The Company is exposed to foreign exchange risk arising from various currency exposures primarily with respect to the US Dollar and the Euro. The Company's management monitors the exchange rate fluctuations on a continuous basis and acts accordingly.
The legal and regulatory framework under which the Company operates stipulates that the Company must maintain a minimum capital adequacy ratio of 8%. The method of calculation is set up by the regulatory authority based on Interntional Basell II capital adequacy requirement directives. The Company aims to always maintain a high capital adequacy ratio well above the required minimum. The capital adequacy ratio is reported to the Company's regulatory authority on a quarterly basis.
The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce cost of capital.
The capital adequacy ratio for the year ended 31 December 2016 was 34,66% (2015; 22.15%)
Capital requirements are derived from credit risk, operational risk and counterparty risk considerations.
The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates and requires Management to exercise its judgment in the process of applying the Company's accounting policies. It also requires the use of assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on Management's best knowledge of current events and actions, actual results may ultimately differ from those estimates.
Estimates and judgments are continually evaluated and are based on historical experience and other factors. including expectations of future events that are believed to be reasonable under the circumstances.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:
The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. The Company uses its judgment to select a variety of methods and make assumptions that are mainly based on market conditions existing at each reporting date. The fair value of the financial assets available for sale has been estimated based on the fair value of these individual assets.
The Company periodically evaluates the recoverability of investments in subsidiaries whenever indicators of impairment are present. Indicators of impairment include such items as declines in revenues, earnings or cash flows or material adverse changes in the economic or political stability of a particular country, which may indicate that the carrying amount of an asset is not recoverable. If facts and circumstances indicate that investment in subsidiaries may be impaired, the estimated future discounted cash flows associated with these subsidiaries/associates would be compared to their carrying amounts to determine if a write-down to fair value is necessary.
ACONTO OFOIIDITION A.T. BLA
| $01/01/2017-3$ 0/06/2017 |
2016 | |
|---|---|---|
| € | € | |
| Interest income Exchange profit Net profit from investment activities Sundry operating income |
99 3.269 239 104 |
1.518 1.345 6.698 |
| 3.711 | 9.561 | |
| Interest income is analysed as follows: | ||
| Bank deposits | 01/01/2017-3 0/06/2017 € 99 |
2016 € 1.518 |
| 99 | 1.518 | |
| 8. Selling and distribution expenses | ||
| $01/01/2017-3$ 0/06/2017 |
2016 | |
| Motor vehicle running costs Inland travelling |
10.746 | € 970 7.596 |
| 10.746 | 8.566 |
| $01/01/2017-3$ | ||
|---|---|---|
| 0/06/2017 | 2016 | |
| € | € | |
| Staff costs | 66.160 | 149.241 |
| Rent | 4.305 | 8.308 |
| Common expenses | 250 | 500 |
| Licenses and taxes | 406 | 3.315 |
| Municipality taxes | 1.144 | |
| Annual levy | 350 | |
| Electricity | 1.027 | 2.800 |
| Water supply and cleaning | 27 | 103 |
| Insurance | 2.025 | 1.868 |
| Repairs and maintenance | 434 | |
| Sundry expenses | 14.092 | 6.984 |
| Telephone and postage | 1.683 | 5.401 |
| Stationery and printing | 216 | 1.840 |
| Subscriptions and contributions | 20.965 | 42.910 |
| Staff training | 600 | 3.883 |
| Computer supplies and maintenance | 1.530 | 3.216 |
| Auditors' remuneration | 2.975 | |
| Accounting fees | 1.200 | 11.863 |
| Other professional fees | 1.750 | 6.000 |
| Inland travelling and accommodation | 4.361 | 9.397 |
| Entertaining | 7.429 | 11.049 |
| Motor vehicle running costs | 809 | 1.829 |
| Other expenses | 2.503 | 15.251 |
| Consulting fees | 2.000 | |
| Amortisation of computer software | 3.869 | |
| Depreciation | 12.450 | |
| 131.338 | 308,980 |
| $01/01/2017-3$ | ||
|---|---|---|
| 0/06/2017 | 2016 | |
| € | ||
| Net loss from operating activities | 48 | 32 |
| Net loss from insurance received | 1.000 | |
| 48 | 1.032 |
| $01/01/2017-3$ | ||
|---|---|---|
| 0/06/2017 | 2016 | |
| € | ||
| Salaries | 59.460 | 135.001 |
| Social security costs | 5.562 | 11.696 |
| Social cohesion fund | 1.138 | 2.544 |
| 66.160 | 149.241 |
| 01/01/2017-3 0/06/2017 |
2016 |
|---|---|
| € | |
| 1.730 | 2.228 |
| 47 | |
| 3.002 | 6.076 |
| 4.779 | 8.305 |
The tax on the Company's profit before tax differs from theoretical amount that would arise using the applicable tax rates as follows:
| Profit before tax | $01/01/2017 - 3$ 0/06/2017 45.281 |
2016 € 26.937 |
|---|---|---|
| Tax calculated at the applicable tax rates | 5.660 | 3.367 |
| Tax effect of expenses not deductible for tax purposes | 656 | 3.924 |
| Tax effect of allowances and income not subject to tax | (42) | (569) |
| Tax effect of tax losses brought forward | (6.274) | (6.722) |
| Tax charge | ||
The corporation tax rate is 12,5%.
Under certain conditions interest income may be subject to defence contribution at the rate of 30%. In such cases this interest will be exempt from corporation tax. In certain cases, dividends received from abroad may be subject to defence contribution at the rate of 17%.
The Company's chargeable income for the period amounted to €50.188 which has been set off against tax losses brought forward. Under current legislation, tax losses may be carried forward and be set off against taxable income of the five succeeding years.
APOLITA APALIBURERA A H = $-$
| Balance at 1 January Additions |
2017 € 2.000 |
2016 € |
||
|---|---|---|---|---|
| Balance at 30 June/31 December | 2.000 | |||
| The details of the subsidiaries are as follows: | ||||
| Name | Country of incorporation |
Principal activities | Holding $\frac{9}{6}$ |
2017 € |
| Aeonic Investments Ltd | Cyprus | Investment Activities |
100 | 2.000 |
| 2,000 |
| 2017 | 2016 | |
|---|---|---|
| € | ||
| Trade receivables | 4,488,825 | 1.427.780 |
| Deposits and prepayments | 3.200 | 3.435 |
| Other receivables | 4.229 | 2.289 |
| Refundable VAT | 14.571 | 10.518 |
| 4,510,825 | .444.02 |
The fair values of trade and other receivables due within one year approximate to their carrying amounts as presented above.
The exposure of the Company to credit risk and impairment losses in relation to trade and other receivables is reported in note 3 of the financial statements.
On the date that these financial statements are issued, the company has executed but not yet cleared transactions amounted to $\epsilon$ 2,437,197 that involved a series of debt instruments sale orders by an institutional client with custodian account held in Eurobank Cyprus. These transactions are due to be cleared on the 4th of July. The company has employed the DVP (Delivery vs Payment) method for large transactions thus eliminating credit or counterparty risk. The above amount would have been deducted from trade and other receivables account and trade and other payables account accordingly providing a true and fair view of the financial accounts.
| 2017 | 2016 | |
|---|---|---|
| € | ||
| Balance at 1 January | 33.480 | |
| Additions | 33.480 | |
| Balance at 30 June/31 December | 33.480 | 33,480 |
| 19. Investors Compensation Fund | ||
| 2017 | 2016 | |
| € | ||
| Balance at 1 January | 73.056 | 73.056 |
| Balance at 30 June/31 December | 73.056 | 73.056 |
Cash balances are analysed as follows
| Cash at bank and in hand | 2017 | 2016 |
|---|---|---|
| € | ||
| 90.935 | 223.197 | |
| 90.935 | 223.197 |
The exposure of the Company to credit risk and impairment losses in relation to cash and cash equivalents is reported in note 3 of the financial statements.
| 2017 Number of |
2017 | 2016 Number of |
2016 | |
|---|---|---|---|---|
| Authorised | shares | € | shares | € |
| Ordinary shares of $E1$ each | 1,000,000 | 1.000.000 | 1,000,000 | 1,000,000 |
| Issued and fully paid | ||||
| Balance at 1 January | 600,000 | 600.000 | 600,000 | 600.000 |
| Balance at 30 June/31 December | 600,000 | 600,000 | 600,000 | 600,000 |
| 2017 | 2016 | |
|---|---|---|
| € | ||
| Trade payables | 4.316.933 | 1.393.749 |
| Social insurance and other taxes | 2.343 | 3.022 |
| Accruals | 4.254 | |
| Other creditors | 5.189 | 32.184 |
| 4.324.469 | 433,209 |
The fair values of trade and other payables due within one year approximate to their carrying amounts as presented above.
On the date that these financial statements are issued, the company has executed but not yet cleared transactions amounted to €2,437,197 that involved a series of debt instruments sale orders by an institutional client with custodian account held in Eurobank Cyprus. These transactions are due to be cleared on the 4th of July. The company has employed the DVP (Delivery vs Payment) method for large transactions thus eliminating credit or counterparty risk. The above amount would have been deducted from trade and other receivables account and trade and other payables account accordingly providing a true and fair view of the financial accounts.
Following a long and relatively deep economic recession, the Cyprus economy began to record positive growth in 2015 which accelerated during 2016. The restrictive measures and capital controls which were in place since March 2013 were lifted in April 2015 and on the back of the strength of the economy's performance and the strong implementation of required measures and reforms, Cyprus exited its economic adjustment programme in March 2016. In recognition of the progress achieved on the fiscal front and the economic recovery, as well as the enactment of the foreclosure and insolvency framework, the international credit rating agencies have proceeded with a number of upgrades of the credit ratings for the Cypriot sovereign, and although the rating continues to be 'non-investment grade', the Cyprus government has regained access to the capital markets. The outlook for the Cyprus economy over the medium term remains positive, however, there are downside risks to the growth projections emanating from the high levels of non performing exposures, uncertainties in the property markets, as well as potential deterioration in the external environment for Cyprus, including continuation of the recession in Russia in conditions of protracted declines in oil prices; weaker than expected growth in the euro area as a result of worsening global economic conditions; slower growth in the UK with a weakening of the pound as a result of uncertainty regarding the result of the Brexit referendum; and political uncertainty in Europe in view of Brexit and the refugee crisis.
This operating environment may have a significant impact on the Company's operations and financial position. Management is taking necessary measures to ensure sustainability of the Company's operations. However, the future effects of the current economic situation are difficult to predict and management's current expectations and estimates could differ from actual results.
The Company's management is unable to predict all developments which could have an impact on the Cyprus economy and consequently, what effect, if any, they could have on the future financial performance, cash flows and financial position of the Company.
On the basis of the evaluation performed, the Company's management has concluded that no provisions or impairment charges are necessary. The Company's management believes that it is taking all the necessary measures to maintain the viability of the Company and the smooth conduct of its operations in the current business and economic environment.
The Company had no contingent liabilities as at 30 June 2017.
The Company had no capital or other commitments as at 30 June 2017.
For the provision of a true and fair view of the financial position of the company, the Board of Directors has decided to maintain all cash held by clients, off balance sheet. As a result, the trade and other receivables represent only the non-cash, invested positions of clients' assets. For comparability purposes, the balances of the previous comparative year have been amended accordingly, as shown in the Statement of Financial Position.
There were no material events after the reporting period, which have a bearing on the understanding of the financial statements.
Significant events that occurred after the end of the reporting period are described in note 23 to the financial statements.
| Page | $01/01/2017 - 3$ 0/06/2017 € |
2016 € |
|
|---|---|---|---|
| Revenue | |||
| Commissions receivable Sales of goods Cost of sales |
391.362 (202.881) |
732.549 5.000 (393.290) |
|
| Gross profit | 188.481 | 344.259 | |
| Other operating income Bank interest Unrealised foreign exchange profit Sundry operating income Net profit from investment activities |
99 3.269 104 239 |
1.518 1.345 6.698 |
|
| 192.192 | 353.820 | ||
| Operating expenses Administration expenses Selling and distribution expenses |
25 25 |
(131.338) (10.746) 50.108 |
(308.980) (8.566) 36.274 |
| Other operating expenses Net loss from operating activities Net loss from insurance received |
(48) | (32) (1.000) |
|
| Operating profit Finance costs |
50.060 (4.779) |
35.242 (8.305) |
|
| Net profit for the period/year before tax | 45.281 | 26,937 |
Period from 1 January 2017 to 30 June 2017
| 01/01/2017-3 0/06/2017 € |
2016 € |
|
|---|---|---|
| Administration expenses | ||
| Directors' remuneration | 1.200 | 98.715 |
| Staff salaries | 58.260 | 36.286 |
| Social insurance | 5.562 | 11.696 |
| Social cohesion fund | 1.138 | 2.544 |
| Rent | 4.305 | 8.308 |
| Common expenses | 250 | 500 |
| Licenses and taxes | 406 | 3.315 |
| Municipality taxes | $\blacksquare$ | 1.144 |
| Annual levy | 350 | |
| Electricity | 1.027 | 2.800 |
| Water supply and cleaning | 27 | 103 |
| Insurance | 2.025 | 1.868 |
| Repairs and maintenance | 434 | |
| Sundry expenses | 14.092 | 6.984 |
| Telephone and postage | 1.683 | 5.401 |
| Stationery and printing | 216 20.965 |
1.840 42.910 |
| Subscriptions and contributions Staff training |
600 | 3.883 |
| Computer supplies and maintenance | 1.530 | 3.216 |
| Auditors' remuneration | 2.975 | |
| Accounting fees | 1.200 | 11.863 |
| Other professional fees | 1.750 | 6.000 |
| Inland travelling and accommodation | 4.361 | 9.397 |
| Entertaining | 7.429 | 11.049 |
| Motor vehicle running costs | 809 | 1.829 |
| Other expenses | 2.503 | 15.251 |
| Consulting fees | i. | 2.000 |
| Amortisation of computer software | $\overline{a}$ | 3.869 |
| Depreciation | 12.450 | |
| 131.338 | 308.980 | |
| $01/01/2017-3$ 0/06/2017 |
2016 | |
| € | € |
Selling and distribution expenses
Motor vehicle running costs
Inland travelling
970 10.746 7.596 10.746 8.566
Period from 1 January 2017 to 30 June 2017
| $01/01/2017-3$ 0/06/2017 € |
2016 € |
|
|---|---|---|
| Finance costs | ||
| Interest expense | ||
| Bank overdraft interest | 47 | $\mathbf{1}$ |
| Sundry finance expenses | ||
| Bank charges | 3.002 | 6.076 |
| Net foreign exchange losses | ||
| Realised foreign exchange loss | 379 | 2.152 |
| Unrealised foreign exchange loss | 1.351 | 76 |
| 4.779 | 8.305 |
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