Source - LSE Regulatory
RNS Number : 4185L
Orient Telecoms PLC
10 September 2021
 

ORIENT TELECOMS PLC

 

("ORIENT" or the "Company")

 

FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2021

 

ORIENT is an information technology company that offers managed services as its core business, which include managed services in machine to machine networking, solutions for internet of things (IOT), cyber security, big data solutions as well as full spectrum of other managed services, announces its results for the year ended 31 March 2021

 

Highlights for the period:

·    The Group recorded an outstanding performance for the year ended 31 March 2021, which saw revenue increase by 34.4% to £807,000 (2020: £601,000) and the basic and diluted profit / (loss) per share increase from a loss per share of 0.14p to a profit per share of 0.84p.

 

·    Our strategy for the coming year is to continue to develop customer-led end-to-end hi-tech solutions not only to serve the B2B sector but also to attend to the government agencies and public work departments.

 

·    Cash position remains strong at £391,783 (2020: £350,692) with no borrowings.

 

The annual report and accounts is available on the Company's website at: www.orient-telecoms.com 


 For more information please contact: 

 

Orient Telecoms plc

 

 

Sayed Mustafa Ali

 

mustafa@orient-telecoms.com

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHAIRMAN'S STATEMENT

                 

 

 

 

On behalf of the Board of Directors, I have great pleasure in presenting the Annual Report and Audited Financial Statements of Orient Telecoms Plc (the "Company") and its subsidiary undertaking (together the "Group") for the financial year ended 31st March 2021.

 

 

OVERVIEW

 

Over the last year the Group has seen the movement of the premise-based Data or Network services to cloud based services continue at an accelerated pace. Working from home has become mainly mandatory, due to the Pandemic, and this requires secure, stable, and constant available connectivity at the servers for an uninterrupted working environment.

 

The Group recorded an outstanding performance for the year ended 31 March 2021, which saw revenue increase by 34.4% to £807,000 (2020: £601,000) and the basic and diluted profit / (loss) per share increase from a loss per share of 0.14p to a profit per share of 0.84p.

 

Cash at the end of the period was £391,783 (2020: £350,692) with no borrowings.

 

The Group has positioned itself as a fully managed overlay network service provider which makes the company noticeably light weight and one not requiring to invest heavily in building the network infrastructure which may later be at risk due to sudden change in technology.

 

With the continued introduction and deployment of 5G services across the region, Orient Telecoms finds itself in a very safe and secure place by having its approach to provide connectivity riding on 3rd party infrastructure. As fixed line telecommunication companies keep on growing their 5G reach, Orient Telecoms will follow their infrastructure to offer its services/platforms to its clients regionally.

During the period Orient Telecoms has continued to work with its in-house research and development team and external partners to introduce new solutions to the market. During the first quarter of the year, it has introduced its own in house developed solution called "Office Mate" a complete SME/SMI business connectivity and data management solution, which helps entrepreneurs start their business and bring it online instantaneously.

 

 

The technology teams have shown good commitment and operationally the Group has achieved excellent performance measured through the feedback from its customers.

 

Our strategy for the coming year is to continue to develop customer-led end-to-end hi-tech solutions not only to serve the B2B sector but also to attend to the government agencies and public work departments.

 

COVID-19 has adversely affected almost all industries and markets. However, the impact on telecommunication business was not as severe. As a result of this effect, the cycle time to convert an opportunity into sales has increased significantly. The sales team is having challenges meeting customers frequently and following up with the relevant people to ensure the deal is closed. The Group foresees this effect to continue in the coming year. The Group has put in place all the necessary tools, processes, and systems to reduce the cycle time as much as possible.

 

 

 

 

 

 

OUTLOOK

 

With the introduction and race to deploy 5G services across the region, Orient Telecoms finds itself in a very safe and secure place by having its approach to provide connectivity riding on 3rd party infrastructure. As the fixed line telecommunication companies keeps on growing their 5G reach, Orient Telecoms will follow their infrastructure to offer its services/platforms to its clients regionally.

 

The Group foresees its near future into AI (Artificial intelligence) driven network, connectivity, data management and smart solutions.

 

The Board views the future with confidence and expects to report another solid performance as it makes further progress towards its medium-term strategy of being a leading regional network telecommunications provider offering connectivity and selling network services across Southeast Asia.

 

 

 

 

 

 

Sayed Mustafa Ali

Director

09 September, 2021

 

 

 

 

 

Strategic Report

 

Strategy, objective and business model

 

The Group provides managed telecommunications services using the network infrastructure owned by other network operators to enable cost effective and rapid connectivity to large bandwidth consumers in Malaysia, Thailand and Singapore. Over time the Group aims to be a leading regional network telecommunications provider offering connectivity and selling managed network services across Southeast Asia. The Group's service offering and the construction of its overlay network requires low capital expenditure and management believe this will enable it to offer attractive pricing to customers in the region.

 

Fair review of business development and performance

 

The Group's cash resources are sufficient for general corporate purposes and its operational activities such as the Group's on-going operating costs and expenses including Directors' fees and salaries.

 

 

Principal risks and uncertainties

 

The Directors have identified the following as the key risks facing the business:

 

-    The Telecommunication sectors

 

The Group operates in a highly competitive and saturated market as the Group is not involved in building its own network infrastructure which would require significant capital expenditure. The Group will be dependent on entering into agreements with licensed network operators in the territories in which it operates in respect of their infrastructure in order to provide a managed service offering to customers and developing its own overlay network. The ability to establish a strong and diversified set of agreements with network operators is important to enable the Group to be able to offer competitive solutions for its customers.

In addition, the Group's operation can be disrupted by a variety of tasks and hazards which are beyond its control such as governmental delays, increase in costs and the availability of equipment or services.

 

-    The Group's relationship with the Executive Director

 

The Group is dependent on the Executive Director to identify potential business opportunities and to execute, and the loss of the services of the Executive Director could materially affect it.

 

-    The Group's existing customers & suppliers

 

The Group is currently dependent on the business from several major customers, as set out in note 16. The company has undertaken an initiative to resolve this issue by way of sourcing and negotiating with various new potential customers with the view to mitigating the risk factor.

The management is also actively looking into engaging more suppliers, which some of it now in final phase to commence the works.

 

 

 

 

 

-    

 

-    Business Strategy

 

The Group is an entity with around 3 years of operating history. The probability that the Group may fail to execute its business plan has been mitigated with experienced management, the recruitment of a high calibre sales team to secure revenue contracts and the board's regular review of the Group's business plan. The Group is also confident that its product has a better edge to support SMEs and will be able to support the target growth of the Group.

 

-    COVID-19 Pandemic

 

The COVID-19 virus led to movement control order in Malaysia from March 2020 onwards which have had the impact of including (i) staff being unable to attend their normal place of work and fulfil their normal duties due to falling ill or being required to self-isolate: (ii) reducing the efficiency of our operation; (iii) disrupting the services of the various providers of 3rd party infrastructure who used to supply our services who may be unable to cope with the increased demands placed upon them.

 

These are mitigated by: (i) the Group has proven technology to enable most employees to carry out their duties remotely; (ii) the Group has a balance sheet with no gearing and be able to access equity financing (if required) to cover any temporary pressure on working capital.

 

The Board seeks to mitigate and manage these risks through continual review, policy setting and enforcement of contractual rights and obligations.

 

Going concern

 

As described in note 2, these financial statements have been prepared on a going concern basis.  After making due enquiry, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for a period of at least 12 months from the date of approval of these financial statements. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

 

Capital and returns management

 

The Company expects that any returns for Shareholders would derive primarily from capital appreciation of the Ordinary Shares and in the medium-term dividends paid pursuant to the Group's dividend policy.

 

Section 172 Report

 

The revised UK Corporate Governance Code ('2018 Code') was published in July 2018 and applies to accounting periods beginning on or after January 1, 2019. The Companies (Miscellaneous Reporting) Regulations 2018 ('2018 MRR') require Directors to explain how they considered the interests of key stakeholders and the broader matters set out in section 172(1) (A) to (F) of the Companies Act 2006 ('S172') when performing their duty to promote the success of the Company under S172. This includes considering the interest of other stakeholders which will have an impact on the long-term success of the company. The S172 statement, explains how Directors:

 

·   have engaged with employees, suppliers, customers and others; and

·   have had regard to employee interests, the need to foster the company's business relationships with suppliers, customers and other, and the effect of that regards, including on the principal decisions taken by the company during the financial year.

 

 

 

The S172 statement focuses on matters of strategic importance to the Group, and the level of information disclosed is consistent with the size and the nature of the business.

The Board has a clear framework for determining the matters within its remit and has approved Terms of Reference for the matters delegated to its committees. Certain financial and strategic thresholds have been determined to identify matters requiring Board consideration and approval. The Manual of Authority sets out the delegation and approval process across the broader business. When making decisions, each Director ensures that he/she acts in the way he/she considers, in good faith, would most likely promote the Group's success for the benefit of its members as a whole, and in doing so have regard (among other matters) to:

 

The likely consequences of any decision in the long term

 

The Directors understand the business and the evolving environment in which the Group operates. The strategy set by the Board is intended to strengthen our position as a leading network services provider while keeping safety and social responsibility fundamental to our business approach. In 2020, to help achieve all strategic ambitions, the Board refreshed our strategy to further focus on developing the Group's business. However, while investing for the future, the Board also recognise we must meet today's connectivity and technology demand.

 

The interests of the company's employees

 

The Directors recognise that Orient employees are fundamental and core to our business and delivery of our strategic ambitions. The success of our business depends on attracting, retaining and motivating employees. In ensuring that we remain a responsible employer, including pay and benefits to our health, safety and workplace environment, the Directors factor the implications of decisions on employees and the wider workforce, where relevant and feasible.

 

The need to foster the company's business relationships with suppliers, customers and others

 

Delivering our strategy requires strong mutually beneficial relationships with suppliers, customers, and government agencies. Orient seeks the promotion and application of certain general principles in such relationships. The ability to promote these principles effectively is an important factor in the decision to enter into or remain in such relationships and this alongside other standards are described in The General Business Principles, which are reviewed and approved by the Board periodically. The Board also reviews and approves the Group's approach to suppliers which is set out in the Supplier Principles. The businesses continuously assess the priorities related to customers and those with whom we do business, and the Board engages with the businesses on these topics, for example, within the context of business strategy updates and investment proposals.

 

Moreover, the Directors receive information updates on a variety of topics that indicate and inform how these stakeholders have been engaged. These range from information provided from the Projects & Technology function to information provided by the businesses.

 

 

The impact of the company's operations on the community and the environment

 

This aspect is inherent in our strategic ambitions, most notably on our ambitions to thrive through the Telecommunication and Technology transition and to sustain a strong societal and business licence to operate. As such, the Board receives information on these topics to both provide relevant information for specific Board decisions (e.g. those related to specific strategic initiatives) and to provide ongoing overviews at the Orient group level (e.g., regular Safety & Environment Performance Updates, reports from the Chief Ethics & Compliance Officer and Chief Internal Auditor).

 

The desirability of the company maintaining a reputation for high standards of business conduct

 

Orient aims to meet the region's growing need of connectivity and cloud-based services with high performance solutions in ways which are economically, technologically, and socially responsible. The Board periodically reviews and approves clear frameworks, such as The General Business Principles, Company's Code of Conduct, specific Ethics & Compliance manuals, and its Modern Slavery Statements, to ensure that its high standards are maintained both within Orient Telecoms businesses and the business relationships we maintain. This, complemented by the ways the Board is informed and monitors compliance with relevant governance standards help assure its decisions are taken and that the Group acts in ways that promote high standards of business conduct.

 

The need to act fairly as between members of the company

 

After weighing up all relevant factors, the Directors consider which course of action best enables delivery of our strategy through the long-term, taking into consideration the impact on stakeholders. In doing so, our Directors act fairly as between the Company's members but are not required to balance the Company's interest with those of other stakeholders, and this can sometimes mean that certain stakeholder interests may not be fully aligned.

 

Culture

 

The Board recognises that it has an important role in assessing and monitoring that our desired culture is embedded in the values, attitudes, and behaviours we demonstrate, including in our activities and stakeholder relationships. The Board has established honesty, integrity, and respect for people as Orient Telecoms' core values. The General Business Principles, Code of Conduct, and Code of Ethics help everyone at Orient Telecoms act in line with these values and comply with relevant laws and regulations. The Commitment and Policy on Health, Safety, Security, Environment & Social Performance applies across the Group and is designed to help protect people and the environment. We relentlessly pursue Goal Zero, our safety goal to achieve no harm and no leaks across all our operations. We also strive to maintain a diverse and inclusive culture.

 

The Board considers the People Survey to be one of its principal tools to measure employee engagement, motivation, affiliation, and commitment to Orient Telecoms. It provides insights into employee views and has a consistently high response rate. The Board also utilises this engagement to understand how survey outcomes are being leveraged to strengthen the Group's culture and values.

 

Stakeholder engagement (including employee engagement)

 

The Board recognises the important role Orient Telecoms has to play in society and is deeply committed to public collaboration and stakeholder engagement. This commitment is at the heart of the Company's strategic ambitions. The Board strongly believes that Orient Telecoms will only succeed by working with customers, governments, business partners, investors, and other stakeholders.

 

We continue to build on our long track record of working with others, such as partners, industry and trade groups, universities, government agencies, and in some instances our competitors through mutually beneficial business dealings. We believe that working together and sharing knowledge and experience with others offers us greater insight into our business. We also appreciate our long-term relationships with our customers, investors and acknowledge the positive impact of ongoing engagement and dialogue.

 

 

 

 

 

 

 

 

To support strengthening the Board's knowledge of the significant levels of engagement undertaken by the broader business, guidance on information, proposals or discussion items provided to the Board was updated in 2021 to further promote and focus considerations of the views, interests and concerns of our stakeholders and how these were considered by Management. The Board also engaged with certain stakeholders directly, to understand their views.

 

 

 

 

 

 

 

Sayed Mustafa Ali

Director

09 September, 2021

 

 

 

 

Directors' report

 

The Directors present their report together with the audited financial statements of the Company and its subsidiary undertaking (together with the "Group") for the year ended 31 March 2021.

 

An indication of the likely future developments in the business of the Group are included in the Strategic Report.

 

Results and dividends

 

The results for the reporting year are set out in the Statement of Comprehensive Income on page 21. The Directors do not recommend the payment of a dividend on the ordinary shares.

 

Directors

 

The Directors of the Company during the year were:

 

Sayed Mustafa Ali

Ross Andrews

Leon Santos

Wong Chee Keong                                         

 

Directors' interest

 

None of the Directors held any interest and deemed interest in the share capital of the Company and its related corporation at the end of financial period.

 

No Director currently has any share options and no share options were granted to or exercised by a Director in the reporting period.

 

Share capital, restrictions on transfer of shares, arrangements affected by change of control and other additional information

 

The Company has one class of share capital, ordinary shares. All the shares rank pari passu. The articles of association of the Company contain provisions governing the transfer of shares, voting rights, the appointment and replacement of Directors and amendments to the articles of association. This accords with usual English company law provisions. There are no special control rights in relation to the Company's shares. There are no significant agreements to which the Company is a party which take effect, alter or terminate in the event of a change of control of the Company. There are no agreements providing for compensation for Directors or employees on change of control.

 

Liability insurance for Company officers

 

The Company has not obtained any third-party indemnity for its Directors.

 

 

 

 

 

Dividend policy

 

The Company's current intention is to retain any earnings for use in its business operations, and the Company does not anticipate declaring any dividends in the foreseeable future. The Company will only pay dividends to the extent that to do so is in accordance with all applicable laws.

 

Substantial shareholders

 

The Company has been notified of the following interests of 3 per cent or more in its issued share capital as at 31 March 2021.

 

Shareholder name

Number of ordinary shares

Percentage of share capital

 

 

 

VCB A.G.

1,000,000

10.00%

Nordic Alliance Holding Limited

600,000

6.00%

Eastman Ventures Limited

600,000

6.00%

Belldom Limited

450,000

4.50%

Link Summit Limited

425,000

4.25%

Infinity Mission Limited

400,000

4.00%

Peel Hunts Holdings Limited

300,000

3.00%

 

Financial risk management and future development

 

An explanation of the Group's financial risk management objectives, policies and strategies is set out in note 18.

 

Events after the reporting date

 

There were no subsequent events after the reporting period.

 

Employee and Greenhouse Gas (GHG) Emissions

 

The Company is trading with less than 20 employees including directors, and therefore has minimal carbon emissions. As the Group's annual energy consumption is below 40,000 kwh no energy and carbon report is presented.

 

The Company promotes a policy for the creation of equal and ethnically diverse employment opportunities including with respect to gender. The Company promotes and encourages employee involvement wherever practical as it recognises employees as a valuable asset and is one of the key contributions to the Company's success.

 

Corporate governance

 

The Company adopted corporate governance and follow its policies and practices that set out in Corporate Governance Statement.

 

 

 

 

Auditors

 

The auditors, Crowe U.K. LLP, have expressed their willingness to continue in office and a resolution to reappoint them will be proposed at the Annual General Meeting.

 

Auditors and disclosure of information

 

The directors confirm that:

·    there is no relevant audit information of which the Company's statutory auditor is unaware; and

·    each Director has taken all the necessary steps he ought to have taken as a Director in order to make himself aware of any relevant audit information and to establish that the Company's statutory auditor is aware of that information.

 

This confirmation is given and should be interpreted in accordance with the provisions of Section 418 of the Companies Act 2006.

 

This was approved by the Board of Directors on 09 September 2021 and is signed on its behalf by;

 

 

 

 

 

Sayed Mustafa Ali

Director

09 September 2021

 

 

 

 

 

Corporate governance

 

The board is committed to maintaining appropriate standards of corporate governance. The statement below explains how the Group has observed principles set out in The UK Corporate Governance Code ("the Code") as relevant to the Group and contains the information required by section 7 of the UK Listing Authority's Disclosure and Transparency Rules ("DTR").

 

Although the UK Corporate Governance Code is not compulsory for companies whose shares are admitted to trading on the Main Market (Standard Listing), the Board recognises the importance of sound corporate governance and have developed governance policies appropriate for the Group, given its current size and resources. The Group is a small group with modest resources. The Group has a clear mandate to optimise the allocation of limited resources to support its expansion and future plans. As such the Group strives to maintain a balance between conservation of limited resources and maintaining robust corporate governance practices. As the Group evolves, the board is committed to enhancing the Group's corporate governance policies and practices deemed appropriate to the size and maturity of the organisation.

 

Board of directors

 

The board currently consists of one executive director and three independent non-executive directors. Following its Admission, the board meets regularly throughout the year to discuss key issues and to monitor the overall performance of the Group. The board has a formal schedule of matters reserved for its decision. The board met three times during the year. The board, led by the independent non-executive directors, evaluates the annual performance of the board and the chairman.

 

The table below sets out the board meetings held by the Company for the year ended 31 March 2021 and attendance of each director:

 

 

Board meetings

Sayed Mustafa Ali

5 / 5

Ross Andrews

5 / 5

Leon Santos

5 / 5

Wong Chee Keong

5 / 5

 

Audit committee

 

The audit committee, which is chaired by Ross Andrews, comprises independent non-executive directors. The Board is satisfied that Ross Andrews has recent and relevant financial experience to guide the committee in its deliberations.

 

The Audit Committee determines the terms of engagement of the Group's auditors and will determine, in consultation with the auditors, the scope of the audit. The Audit Committee receives and reviews reports from management and the Group's auditors relating to the interim and annual accounts and the accounting and internal control systems in use throughout the Group. The ultimate responsibility for reviewing and approving the Annual Report and financial statements and the half-yearly reports remains with the Board.

 

 

The Audit Committee is responsible for:

·   monitoring in discussion with the auditors the integrity of the financial statements of the Company, any formal announcements relating to the Company's financial performance and reviewing significant financial reporting judgements contained in them;

·   reviewing the Company's internal financial controls and the Company's internal control and risk management systems;

·   considering annually whether there is a need for an internal audit function and make a recommendation to the Board;

·   making recommendations to the Board for it to put to the shareholders for their approval in the general meeting, in relation to the appointment, re-appointment and removal of the external auditor and to approve the remuneration and terms of engagement of the external auditor;

·   reviewing and monitoring the external auditor's independence and objectivity and the effectiveness of the audit process, taking into consideration relevant UK professional and regulatory requirements;

·   developing and implementing policy on the engagement of the external auditor to supply non-audit services, taking into account relevant external guidance regarding the provision of non-audit services by the external audit firm; and

·   reporting to the Board, identifying any matters in respect of which it considers that action or improvement is needed and making recommendations as to the steps to be taken.

 

For the year under review, there were no non- audit services rendered to the Group and the Company. The audit committee considered the nature, scope of engagement and remuneration paid were such that the independence and objectivity of the auditors were not impaired. Fees paid for audit are provided in Note 5.

 

Remuneration committee

 

The remuneration committee consists of both executive and non-executive directors and is chaired by Leon Santos. It meets when required to consider aspects of directors' and staff remuneration, share options and service contracts.

 

The Directors' Remuneration Report is presented on page 16 to 17.

 

Nominations committee

 

Mr Wong Chee Keong (Chairman) and the Nomination Committee which consists of both executive director and independent non-executive directors. The nomination committee meets, when required, to examine the selection and appointment practises in meeting the company's need. No such meeting took place during the year.

 

Internal financial control

 

Financial controls have been established to provide safeguards against unauthorised use or disposition of the assets, to maintain proper accounting records and to provide reliable financial information for internal use.

 

Key financial processes include:

·    the maintenance of proper records;

·    a schedule of matters reserved for the approval of the board;

·    evaluation, approval procedures and risk assessment required close involvement of the chief executive in the day-to-day operational matters of the company.

 

The directors consider the size of the company and the close involvement of executive directors in the day-to-day operations makes the maintenance of an internal audit function unnecessary. The directors will continue to monitor this situation.

 

Relations with shareholders

 

The Company maintains a corporate website at http://www.orient-telecoms.com/. This website is updated regularly and includes information on the Company's share price as well as other relevant information concerning the Company, which is available for downloading.

 

Statement of Directors' Responsibilities

 

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare the Group and the Company financial statements for each financial year. Under that law the directors have elected to prepare the Group financial statements in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulations (EC) No 1606/2002 as it applies in the European Union (IFRSs) and elected to prepare the Company financial statements under United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable laws including FRS 101 Reduced Disclosure Framework) and applicable law.

 

Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period. In preparing these financial statements, the directors are required to:

-     select suitable accounting policies and then apply them consistently;

-     make judgements and accounting estimates that are reasonable and prudent;

-     state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-     prepare the Strategic Report, Directors' report and Directors' Remuneration report which comply with the requirements of the Companies Act 2006;

-     prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the Company will continue in business.

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and the Company's transactions and disclose with reasonable accuracy at any time, the financial position of the Group and the Company to enable them to ensure that the financial statements comply with the requirements of the Companies Act 2006. They are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

 

 

 

Website publication

 

The directors are responsible for ensuring that the Strategic Report, Directors' report and other information included in the annual report and the financial statements are made in accordance with applicable law in the United Kingdom. The maintenance and integrity of the Orient Telecoms Plc website is the responsibility of the Directors.

 

Legislation in the United Kingdom governing the preparation and dissemination of the accounts and the other information included in annual reports may differ from legislation in other jurisdictions.

 

The Directors are responsible for preparing the Financial Statements in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority ("DTR") and with International Financial Reporting Standards as adopted by the European Union.

 

The directors confirm, to the best of their knowledge that:

·    the financial statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and Company;

·    the Strategic and Directors' Report include a fair review of the development and performance of the business and the financial position of the Group and the Company, together with a description of the principal risks and uncertainties that it faces; and

·    the annual report and financial statements, taken as a whole, are fair, balanced, and understandable and provide the information necessary for shareholders to assess the group's position, performance, business model and strategy.

 

 

 

 

Directors' Remuneration Report

 

The Directors' Remuneration Report sets out the Group's  policy on the remuneration of Directors together with the details of Directors' remuneration packages and services contracts for the period 1 April 2020 to 31 March 2021.

 

The Board as a whole will review the scale and structure of the Directors' fees, taking into account the interests of the shareholders and the performance of the Company and Directors.

 

The items included in this report are unaudited unless otherwise stated.

 

The Company maintains contact with its shareholders about remuneration in the same way as other matters and, as required by Section 439 of the Companies Act 2006, this remuneration report will be put to an advisory vote of the Company's shareholders at the forthcoming Annual General Meeting.

 

Statement of Orient Telecoms plc's policy on Directors' remuneration

 

As set out in the Company's Prospectus dated 18 October 2017, each of the Directors may be paid a fee at such rate as may from time to time be determined by the Board. However, the aggregate of all fees payable to the Directors must not exceed £150,000 a year or such higher amount as may from time to time be decided by ordinary resolution of the Company.

 

In addition, any fees payable to the Directors shall be distinct from any salary, remuneration or other amounts payable to a Director under any other provisions and shall accrue from day to day.

 

The Board may also make provisions for pension entitlement for Directors.

 

There have been no changes to the Directors' remuneration or remuneration policy since the publication of the Company's Prospectus dated 18 October 2017.

 

Terms of employment

 

Sayed Mustafa Ali has been appointed by the Company to act as an executive director under a service agreement dated 12 October 2017. His appointment commenced on 12 October 2017 and is terminable on six months' written notice on either side. He is entitled to a fee of £15,000 per annum.

 

Wong Chee Keong has been appointed by the Company to act as a non-executive director under a service agreement dated 9 April 2020. His appointment commenced on 9 April 2020 and is terminable on six months' written notice on either side. He is entitled to a fee of RM120,000 (approximately £19,900) per annum.

 

Ross Andrews has been appointed by the Company to act as a non-executive director under a service agreement dated 12 October 2017. His appointment commenced on 12 October 2017 and is terminable on three months' written notice on either side. He is entitled to a fee of £20,000 per annum.

 

Leon Santos has been appointed by the Company to act as a non-executive director under a service agreement dated 12 October 2017. His appointment commenced on 12 October 2017 and is terminable on three months' written notice on either side. He is entitled to a fee of £15,000 per annum.

 

 

 

 

 

 

Policy for new appointments

 

Base salary levels will take into account market data for the relevant role, internal relativities, the individual's experience and their current base salary. Where an individual is recruited below market norms, they may be re-aligned over time (e.g. two to three years), subject to performance in the role. Benefits will generally be in accordance with the approved policy.

 

Directors' emoluments and compensation

 

Directors' emoluments for the year ended 31 March 2021 are set out in note 15.

 

Statement of Directors' shareholding and share interest

 

The Directors who served during the year ended 31 March 2021, and their interests at that date, are disclosed on Page 9. There were no changes between the reporting date and the date of approval of this report.

 

None of the Directors has any potential conflicts of interest between their duties to the Company and their private interests or other duties they may also have.

 

Other Matters

 

The Company does not currently have any annual or long-term incentive schemes in place for any of the Directors and as such there are no disclosures in this respect.

 

The Company does not have any pension plans for any of the Directors and does not pay pension amounts in relation to their remuneration.

 

The Company has not paid out any excess retirement benefits to any Directors.

 

Approved on behalf of the Board of Directors.

 

 

 

 

 

 

 

Leon Santos

Chairman, Remuneration Committee

09 September 2021

 

 

 

 

INDEPENDENT AUDITOR'S REPORT

 

Opinion                             

We have audited the financial statements of Orient Telecoms Plc (the "Company") and its subsidiary (the "Group") for the year ended 31 March 2021, which comprise:

·    the consolidated statement of comprehensive income for the year ended 31 March 2021;

·    the consolidated and the Company statements of financial position as at 31 March 2021;

·    the consolidated statements of cash flows for the year ended 31 March 2021;

·    the consolidated and the Company statements of changes in equity for the year then ended 31 March 2021; and

·    notes to the financial statements, which include a summary of significant accounting policies and other explanatory information.

 

The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law and International Accounting Standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulations (EC) No 1606/2002 as it applies in the European Union (IFRSs). The financial reporting framework that has been applied in the preparation of the Company financial statements is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).     

In our opinion:

·    the financial statements give a true and fair view of the state of the Group's and the Company's affairs as at 31 March 2021 and of the Group's profit for the year then ended;

·    the Group financial statements have been properly prepared in accordance with IFRSs;

·    the Company financial statements have been properly prepared in accordance United Kingdom Accounting Standards; and

·    the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Company and the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the ability of the Group and the Parent Company continue to adopt the going concern basis of accounting included the following procedures:

We evaluated the Directors' assessment of the Group and the Parent Company's ability to continue as a going concern, including tested the integrity of the going concern model, reviewed and challenged the underlying data and key assumptions used to make the assessment. Additionally, we reviewed and challenged the results of management's stress testing, to assess the reasonableness of economic assumptions in light of the impact of COVID-19 on the Group's solvency and liquidity position.

Further details of the Directors' assessment of going concern is provided in Note 2.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the ability of the Group or the Parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Overview of our audit approach

Materiality

In planning and performing our audit we applied the concept of materiality. An item is considered material if it could reasonably be expected to change the economic decisions of a user of the financial statements. We used the concept of materiality to both focus our testing and to evaluate the impact of misstatements identified.

Based on our professional judgement, we determined overall materiality for the Group financial statements as a whole to be £13,000 (2020: £12,000), based on 3% of the Group's net assets at the year end.

We use a different level of materiality ('performance materiality') to determine the extent of our testing for the audit of the financial statements. Performance materiality is set based on the audit materiality as adjusted for the judgements made as to the entity risk and our evaluation of the specific risk of each audit area having regard to the internal control environment. We determined performance materiality to be £9,500 (2020: £9,000). 

Where considered appropriate performance materiality may be reduced to a lower level, such as, for related party transactions and directors' remuneration.

We agreed with the Audit Committee to report to it all identified errors in excess of £400 (2020: £360). Errors below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required on qualitative grounds.

Overview of the scope of our audit

The Company is accounted for from one central operating location based in Kuala Lumpur, Malaysia where all the Group's records were maintained.

In establishing our overall approach to the Group audit, we determined the type of work that needed to be undertaken at the significant component by us, as the primary audit engagement team. For the full scope component in Malaysia, where the work was performed by a member firm of Crowe Global Network, we determined the appropriate level of involvement to enable us to determine that sufficient audit evidence had been obtained as a basis for our opinion on the Group as a whole.

We engaged with the component auditors at all stages during the audit process and directed the audit work on the non-UK subsidiary undertakings. We directed the component auditor regarding the audit approach at the planning stage, issued instructions that detailed the significant risks to be addressed through the audit procedures and indicated the information we required to be reported on. At the planning stage we determined that the audit team, including the audit engagement partner, would visit the component auditors and the principal finance locations of the significant non-UK components in order to review the component auditors' working papers, discuss key findings directly with the component audit team and component auditor reporting partner and conclude on significant issues. This proved not to be possible because of the impact of the Covid-19 pandemic in relation to quarantine restrictions. We therefore determined that regular progress calls and remote audit file reviews were appropriate in the exceptional circumstances.

This, together with the additional procedures performed at Group level, gave us appropriate evidence for our opinion on the Group financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional 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.

Going concern was identified as a key audit matter and has been addressed within the "Conclusion relating to going concern" section of the audit report. We have determined that there are no other key audit matters to communicate in our report.

Our audit procedures in relation to the matter were designed in the context of our audit opinion as a whole. They were not designed to enable us to express an opinion on the matter individually and we express no such opinion.

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 this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, the part of the directors' remuneration report to be audited has been properly prepared in accordance with the Companies Act 2006.

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

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

·    the strategic report and directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In light of the knowledge and understanding of the Group and the Company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

·    we have not received all the information and explanations we require for our audit; or

·    adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or

·    certain disclosures of directors' remuneration specified by law are not made; or

·    the Company's financial statements and the part of the directors' remuneration report to be audited are not in agreement with the accounting records and returns.

 

Responsibilities of the directors for the financial statements

As explained more fully in the directors' responsibilities statement set out on page 14, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group and 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 Group or the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We obtained an understanding of the legal and regulatory frameworks within which the Group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were relevant company law and taxation legislation in the UK and Malaysia jurisdictions in which the Group operates.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be the override of controls by management. Our audit procedures to respond to these risks included enquiries of management about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals and reviewing accounting estimates for biases.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards.  We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Other matters which we are required to address

We were appointed by the Board on 10 July 2017 to audit the financial statements for the year ended 31 March 2017. Our total uninterrupted period of engagement is 4 years, covering the period ended 31 March 2017 until the year ended 31 March 2020.

The provision of non-audit services to the company is prohibited under the FRC's Ethical Standard.  We confirm that we have not provided any non-audit services to the Company during the financial year ended 31 March 2021 and we remain independent of the Company in conducting our audit.

Our audit opinion is consistent with the additional report to the audit committee.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

 

 

 

 

 

Leo Malkin

Senior Statutory Auditor

For and on behalf of

Crowe U.K. LLP

Statutory Auditor

London

 

09 September 2021

 

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 MARCH 2021

 

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

 

Notes

£

 

£

 

 

 

 

 

Revenue

4

807,133

 

600,596

Direct cost

 

(276,424)

 

(187,403)

GROSS PROFIT

 

530,709

 

413,193

Administrative expenses

5

(441,203)

 

(423,392)

OPERATING PROFIT / (LOSS)

 

89,506

 

(10,199)

Other income

 

2,972

 

-

Finance income

 

850

 

4,879

Finance cost

 

(9,756)

 

(8,595)

PROFIT / (LOSS) BEFORE TAXATION

 

83,572

 

(13,915)

Income tax expense

6

-

 

-

PROFIT / (LOSS) FOR THE YEAR ATTRIBUTABLE TO EQUITY HOLDERS

 

 

83,572

 

 

(13,915)

 

 

 

 

 

OTHER COMPREHENSIVE INCOME

 

 

 

 

Items that will or may be reclassified to profit or loss:

 

 

 

 

Translation of foreign operation

 

(27,785)

 

15,793

TOTAL COMPREHENSIVE PROFIT FOR THE YEAR

 

55,787

 

1,878

 

 

 

 

 

Basic and diluted profit/(loss) per share (pence)

7

0.84

 

(0.14)

 

 

The notes to the financial statements form an integral part of these financial statements.

 

All amounts are derived from continuing operations.

 

 

 

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 MARCH 2021

 

 

As at

31 March 2021

 

As at

31 March 2020

 

Notes

£

 

£

ASSETS

 

 

 

 

 

 

 

 

 

NON-CURRENT ASSET

 

 

 

 

Right-of -use asset

8

219,356

 

70,765

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

Trade and other receivables

9

306,455

 

229,092

Bank

10

391,783

 

350,692

 

 

698,238

 

579784

 

 

 

TOTAL ASSETS

 

917,594

 

650,549

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY

 

 

 

 

Share capital

11

1,000,000

 

1,000,000

Translation reserve

 

(23,713)

 

4,072

Accumulated loss

 

(521,247)

 

(604,819)

 

 

455,040

 

399,253

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

Trade and other payables

12

238,828

 

177,471

Lease liability

13

96,094

 

73,825

 

 

334,922

 

251,296

 

 

 

 

 

NON-CURRENT LIABILITIES

 

 

 

 

Lease liability

13

 

 

 

 

 

 

 

 

 

TOTAL EQUITY AND LIABILITIES

 

917,594

 

650,549

 

 

 

 

 

The notes to the financial statements form an integral part of these financial statements.

 

This report was approved by the board and authorised for issue on 09 September 2021 and signed on its behalf by;

 

 

 

………………………

Sayed Mustafa Ali

Director

 

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 MARCH 2021

 

 

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

 

£

 

£

 

 

 

 

 

Cash flow from operating activities

 

 

 

 

Profit/(loss) before tax

 

83,572

 

(13,915)

Adjustment for:

 

 

 

 

Unrealised exchange loss

 

5,927

 

15,793

Depreciation of right-of-use-assets

 

 

99,010

 

94,354

Gain on lease termination

 

(4,174)

 

-

Interest income

 

(850)

 

(4,879)

Interest on lease liabilities

 

9,756

 

8,595

 

 

193,241

 

99,948

Changes in working capital

 

 

 

 

Trade and other receivables

(77,362)

 

919

Trade and other payables

47,168

 

(184,785)

Cash flow from operations

 

163,046

 

(83,918)

Interest received

 

850

 

4,879

Net cash generated from/(used in) operating activities

 

163,896

 

(79,039)

 

 

 

 

 

Cash flow from financing activities

 

 

 

 

Interest paid

 

(9,756)

 

(8,595)

Repayment on lease liability

 

 

(90,885)

 

(92,690)

Net cash used in financing activities

 

(100,641)

 

(101,285)

 

 

 

 

 

 

 

 

 

 

Net movement in cash and cash equivalents

 

63,255

 

(180,324)

Cash and cash equivalents at beginning of period

 

350,692

 

529,278

Exchange gain on cash and cash equivalents

 

(22,164)

 

1,738

Cash and cash equivalents at end of period

 

391,783

 

350,692

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 MARCH 2021

 

 

 

Share capital

 

Translation reserve

 

Accumulated loss

 

Total

 

£

 

£

 

£

 

£

As at 31 March 2019

1,000,000

 

(11,721)

 

(590,904)

 

397,375

 

 

 

 

 

 

 

 

Translation of foreign operation

-

 

15,793

 

-

 

15,793

Loss for the year

-

 

-

 

(13,915)

 

(13,915)

Total comprehensive income for the year

-

 

15,793

 

(13,915)

 

1,878

 

 

 

 

 

 

 

 

As at 31 March 2020

1,000,000

 

4,072

 

(604,819)

 

399,253

 

Translation of foreign operation

-

 

(27,785)

 

-

 

(27,785)

Profit for the year

-

 

-

 

83,572

 

83,572

Total comprehensive income for the year

-

 

(27,785)

 

83,572

 

55,787

 

 

 

 

 

 

 

 

As at 31 March 2021

1,000,000

 

(23,713)

 

(521,247)

 

455,040

 

 

 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2021

 

1.   GENERAL INFORMATION

 

The Company was incorporated in England and Wales on 26 February 2016, as a public company limited by shares under the UK Companies Act 2006. The registered office of the Company is at the offices of London Registrar, Suite A, 6 Honduras St, London EC1Y 0TH United Kingdom.

 

The financial statements comprise of financial information of the Company and its subsidiary (together referred to as the "Group").

 

 

2.   ACCOUNTING POLICIES

 

The Board has reviewed the accounting policies set out below and considers them to be the most appropriate to the Group's business activities.

 

Basis of preparation

 

The financial statements have been prepared in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union (IFRSs). The financial statements have been prepared under the historical cost convention as modified for financial assets carried at fair value.

 

The financial information of the Company is presented in British Pound Sterling ("£") which is the functional currency of the Company.

 

Going concern

 

The Group meets its day to day working capital requirements through existing cash reserves. In undertaking this assessment, they have considered the principal risks and uncertainties as set out in the Strategic Report, and have assessed that the Group will have adequate working capital for the Company and the Group to be able to meet its liabilities as they fall due.

 

COVID-19 pandemic has affected the business and economic environments of the Group. Different measures taken by the governments and various private corporations to prevent the spread of the virus such as travel bans, closures of non-essential services, social distancing and home quarantine requirements may impact consumers' spending pattern and the Group's operations directly or indirectly which may affect operating cash flows and liquidity.

 

The directors have prepared financial projections and plans for a period of at least 12 months from the date of approval of these financial statements. In view of the prolonged Covid-19 global pandemic, the directors believe the Group has considerable financial resources together with a diverse corporate customer base and long-standing relationship with a number of key suppliers. As a consequence, the Group is well placed to manage its business risks.

 

For the year under review, the Group returned to profitability and was net cash generating from the operating activities. The Group had a cash balance of approximately £392,000 at the reporting date and the cash balance was approximately £350,000 at 30 July 2021, which the Directors believe will be sufficient to pay its ongoing expenses and to meet its liabilities as they fall due for a period of at least 12 months from the date of approval of the financial statements. These financial statements have been prepared on a going concern basis at the end of reporting period.

 

 

After making this enquiry, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

 

Standards and interpretations issued but not yet applied

 

The following standards, amendments and interpretations became effective from 1 January 2020, however none of these new standards has had an impact on the Group financial statements:

 

·    IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors (Amendment - Disclosure Initiative - Definition of Material)

·    IFRS 3 Business Combinations (Amendment - Definition of Business) Conceptual Framework for Financial Reporting (Revised)

·    IBOR Reform and its Effects on Financial Reporting

·    COVID-19 Related Rent Concessions - Amendment to IFRS 16

 

 

A number of new standards and amendments to standards and interpretations have been issued by International Accounting Standards Board but are not yet effective. The Directors do not expect that the adoption of these standards will have a material impact on the financial statements of the Group in future periods.

 

Basis of consolidation

             

The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries drawn up to 31 March each year. Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

 

Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by other members of the Group.

 

All intra-company transaction, balances, income and expenses are eliminated in full on consolidation.

 

Revenue recognition

 

The accounting policies for the group's revenue from contracts with customers are explained in note 4.

 

Taxation

 

The tax currently payable is based on the taxable profit for the period. Taxable profit differs from net profit as reported in the income statement because the taxable profits exclude items of income or expense that are taxable or deductible in other periods and it further excludes items that are not taxable or deductible. The Group's liability for corporate tax is calculated using the income tax rates that have been gazetted for the current reporting date.

 

Deferred income tax is provided for using the liability method on temporary differences at the reporting date between the tax basis of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax liabilities are recognised in full for all temporary differences. Deferred income tax assets are recognised for all deductible temporary differences carried forward of unused tax credits and unused tax losses to the extent that it is probable that taxable profits will be available against which the deductible temporary differences and carry-forward of unused tax credits and unused losses can be utilised.

 

The carrying amount of deferred income tax assets is assessed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the deferred income tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at each reporting date and are recognised to the extent that is probable that future taxable profits will allow the deferred income tax asset to be recovered.

 

Foreign currency

 

The Group's consolidated financial statements are presented in Sterling. The functional currency of the Group's subsidiary is Ringgit Malaysia ("MYR"). The Group determines the functional currency and items included in the financial statements of each entity are measured using that functional currency.

 

The assets and liabilities of foreign operations are translated into sterling at the rate of exchange ruling at the reporting date. Income and expenses are translated at weighted average exchange rates for the period. The exchange differences arising on translation for consolidation are recognised in other comprehensive income.

 

Financial instruments

 

Financial assets and financial liabilities are recognised on the statement of financial position when the Group becomes a party to the contractual provisions of the instrument.

 

Financial assets

 

Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value through other comprehensive income (OCI), and fair value through profit or loss (FVTPL).

 

The classification of financial assets at initial recognition depends on the financial asset's contractual cash flow characteristics and the Group's business model for managing them. With the exception of trade receivables that do not contain a significant financing component or for which the Group has applied the practical expedient, the Group initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables that do not contain a significant financing component or for which the Group has applied the practical expedient are measured at the transaction price determined under IFRS 15.

 

Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is de-recognised, modified or impaired.

 

The Group's financial assets at amortised cost includes trade receivables and loan to related parties, are included under other non-current financial assets. In the periods presented the Group does not have any financial assets categorised as fair value through OCI.

 

Impairment provisions for current and non-current trade receivables are recognised based on the simplified approach within IFRS 9 using a historical provision matrix in the determination of the lifetime expected credit losses except for the key customer which are separately assessed with its standalone credit risk profile. During this process the probability of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such provisions are recorded in a separate provision account with the loss being recognised within administration expenses in the consolidated statement of comprehensive income. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

 

Impairment provisions for receivables from related parties and loans to related parties are recognised based on a forward-looking expected credit loss model. The methodology used to determine the amount of the provision is based on whether there has been a significant increase in credit risk since initial recognition of the financial asset. For those for which credit risk has increased significantly, lifetime expected credit losses are recognised, unless further information becomes available contrary to the increased credit risk. For those that are determined to be permanently credit impaired, lifetime expected credit losses are recognised.

 

Trade and other payables

 

Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, where applicable, using the effective interest method, with interest expense recognised on an effective yield basis.

 

Cash and cash equivalents

 

The Group considers any cash on short-term deposits and other short-term investments to be cash equivalents.

 

Leases

 

The Group assesses whether a contract is or contains a lease, at the inception of the contract. The Group recognises a right-of-use asset and corresponding lease liability with respect to all lease arrangements in which it is the lessee, except for low-value assets and short-term leases with 12 months or less. For these leases, the Group recognises the lease payments as an operating expense on a straight-line method over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed.

 

The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use assets and the associated lease liabilities are presented as a separate line item in the statement of financial position.

 

The right-of-use asset is initially measured at cost. Cost includes the initial amount of the corresponding lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred, less any incentives received.

 

The right-of-use asset is subsequently measured at cost less accumulated depreciation and any impairment losses, and adjustment for any remeasurement of the lease liability. The depreciation starts from the commencement date of the lease. If the lease transfers ownership of the underlying asset to the Group or the cost of the right-of-use asset reflects that the Group expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. Otherwise, the Group depreciates the right-of-use asset to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.

 

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the incremental borrowing rate is calculated on a lease by lease basis.

 

The lease liability is subsequently measured at amortised cost using the effective interest method. It is remeasured when there is a change in the future lease payments (other than lease modification that is not accounted for as a separate lease) with the corresponding adjustment is made to the carrying amount of the right-of-use asset or is recognised in profit or loss if the carrying amount has been reduced to zero.

 

Operating segments

 

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision maker has been identified as the management team including the two main directors and two non-executive directors.

 

The Board considers that the Group's activity constitutes one operating and one reporting segment, as defined under IFRS 8. Management reviews the performance of the Group by reference to total results against budget.

 

The total profit measures are operating profit and profit for the period, both disclosed on the face of the income statement. No differences exist between the basis of preparation of the performance measures used by management and the figures in the Group's financial information.

 

3.   CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

 

The preparation of financial statements in compliance with IFRSs requires the use of certain critical accounting estimates or judgements. The estimates and judgements which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year are discussed below:

 

Lease liability discount rate

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the Group, the lessee's incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions.

 

To determine the incremental borrowing rate, the Group:

•     Where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing was received;

•     Uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by the company, which does not have recent third-party financing; and

•     Makes adjustments specific to the lease, e.g. term, currency and security.

 

The Group used incremental borrowing rates at a prevailing rate of 6.9%.

 

 

 

4.   REVENUE

 

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

£

 

£

 

 

 

 

Revenue

807,133

 

600,596

 

807,133

 

600,596

 

Revenue is recognised either when the performance obligation in the contract has been performed (so 'point in time' recognition) or 'over time' as control of the performance obligation is transferred to the customer. Revenue represents rendered managed telecommunication services to the customers, the end users, which is recognised over the period of time when the services is performed.

 

Invoicing and payment terms are generally monthly in advance except for a single customer is granted extended timeframe for settlement. A contract liability represents the obligation of the Group to render services to a customer for which consideration has been received (or the amount is due) from the customer.

 

In addition, under contract with customer, the customer is also entitled to claim rebates if the service performance/downtime is more than the allowed hours in any given month. The Group has implemented an open source fully customised Network Performance Monitoring system, which can provide an in-depth view of performance by customer. Due to the high level of service provided under each contract with a customer, the Group has no history of having to provide rebates. On that basis, the variable consideration was considered as remote.

 

All revenue derived from Malaysia, Singapore and Thailand. Revenue excludes value added tax and other sales taxes.

 

 

 

 

5.   MATERIAL PROFIT OR LOSS ITEMS

 

A number of items which are material due to the significance of their nature and/or amount is stated as follow:

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

£

 

£

 

 

 

 

Consultancy fee

23,128

 

21,580

Staff costs (include directors)

161,442

 

192,216

Depreciation of right-of-use assets

99,010

 

94,354

Advertising and marketing

45,034

 

0

Interest on lease liability

9,756

 

8,595

Auditors' remuneration:

 

 

 

Fees payable to the Group's auditor for the audit of the Group's annual accounts

22,000

 

22,000

Fees payable to the Group's subsidiary auditor for the audit of the subsidiary's annual accounts

4,587

 

4,918

 

6.   INCOME TAX EXPENSE

 

The corporation tax in the UK applied during the year was 19% (2020: 19%).

 

The charge for the year can be reconciled to the profit/(loss) in the Statement of Comprehensive income as follow:

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

£

 

£

Profit/(loss) before tax on continuing operations

83,571

 

(13,915)

 

 

 

 

Tax at the UK corporation tax rate

15,879

 

(2,644)

Tax effect of expenses that are not deductible in determining taxable profit

3,664

 

 

1,850

Difference in oversea tax rate

(1,065)

 

(1,203)

Utilised tax loss

(19,924)

 

(1,926)

Unutilised tax loss carried forward

1,446

 

3,922

Tax charge for the year

-

 

-

 

The Group has accumulated tax losses of approximately £110,000 (2020: £182,000) which can be carried forward indefinitely. No deferred tax asset has been recognised in respect of the losses carried forward, due to the uncertainty as to whether the Group will generate sufficient future profits in the foreseeable future to prudently justify this.

 

 

 

 

7.   PROFIT / (LOSS) PER SHARE

 

Basic and diluted profit/(loss) per ordinary share is calculated by dividing the profit/(loss) attributable to equity holders of the Group by the weighted average number of ordinary shares in issue during the period. Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares.  There are currently no dilutive potential ordinary shares.

 

Profit/(loss) per share attributed to ordinary shareholders

 

Year ended

31 March 2021

 

Year ended

31 March 2020

Profit/(loss) for the year (£)

83,572

 

(13,915)

Weighted average number of shares (Unit)

10,000,000

 

10,000,000

Basic and diluted profit/(loss) per share (Pence)

0.84

 

(0.14)

 

8.   RIGHT-OF-USE ASSET

 

 

Office

Cost

£

At 1 April 2019

-

Recognition of right-of-use on initial application of IFRS 16

165,119

Adjusted balance at 1 April 2019 and 31 March 2020

165,119

Addition

292,474

Derecognition due to lease termination

(44,098)

Exchange differences

(10,775)

At 31 March 2021

402,720

 

 

Accumulated depreciation

 

At 1 April 2019

-

Charge for the year

94,354

At 31 March 2020

94,354

Charge for the year

99,010

Exchange differences

(10,000)

   At 31 March 2021

183,364

 

 

Net Book Value

 

At 31 March 2021

219,356

At 31 March 2020

70,765

 

The Group subsidiary entered into a lease agreement for an office. The lease is for a period of 24 months lease agreement with an option to renew the lease for a further 12 months.

 

9.   TRADE AND OTHER RECEIVABLES

 

 

As at

31 March 2021

 

As at

31 March 2020

 

£

 

£

 

 

 

 

Trade receivables

217,037

 

210,224

Prepayment and deposit

64,374

 

-

Other receivables

25,044

 

18,868

 

306,455

 

229,092

 

The Group allows credit terms of 30 days to all customers. During the pandemic, the Group made an exception to allow certain customers to settle the debts at the agreed extended timeframe. Subsequent to the year end, the Group received the payment of the overdue debts in full before the date of approval these financial statements. Accordingly, these past due trade receivables are not impaired and no expected credit loss is recognised in these financial statements.

 

10. BANK

 

Cash and cash equivalents are denominated in the following currencies:

 

 

As at

31 March 2021

 

As at

31 March 2020

 

£

 

£

 

 

 

 

Great Britain Pound

20,102

 

20,703

Singapore Dollar

18,494

 

19,514

United States Dollar

25,370

 

26,667

Malaysia Ringgit

327,817

 

283,808

 

391,783

 

350,692

 

 

11. SHARE CAPITAL

 

Ordinary shares of £0.10 each

 

Number of shares

 

Amount

£

Issued and paid up

 

 

 

At 31 March 2020 and 31 March 2021

10,000,000

 

1,000,000

 

At 31 March 2021, the total issued ordinary share of the Group were 10,000,000.

 

 

 

 

12. TRADE AND OTHER PAYABLES

 

As at

31 March 2021

 

As at

31 March 2020

 

£

 

£

 

 

 

 

Amount due to related company

-

 

89,674

Amount due to directors

3,004

 

4,166

Trade creditors

134,551

 

35,847

Accruals

40,703

 

33,800

Contract liability

10,418

 

-

Other payables

50,152

 

13,984

 

238,828

 

177,471

 

13. LEASE LIABILITY

 

 

As at

31 March 2021

As at

31 March 2020

 

£

£

At 1 April

73,825

 

-

Addition

292,474

166,515

Changes due to lease modification

(48,272)

-

Repayment of principal

(90,885)

(92,690)

Exchange differences

(3,416)

-

   At 31 March

223,726

73,825

       

 

Lease liabilities are payable as follow:

 

 

Current liability

96,094

 

73,825

Non-current liability

127,632

-

 

223,726

73,825

 

 

14. SUBSIDIARY UNDERTAKING

 

The details of the subsidiary in the Group are as follows:

 

Name of subsidiary

Country of incorporation

Effective holding

Principal activities

Orient BB Sdn. Bhd.

Malaysia

100%

IT managed services

 

Below is the registered address of the subsidiary undertakings.

 

Orient BB Sdn. Bhd.

28, 3rd Floor, Lorong Medan Tuanku Satu,

50300, Kuala Lumpur, Malaysia

 

 

 

 

 

15. EMPLOYEES AND DIRECTORS' EMOLUMENTS

 

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

£

 

£

Staff costs (include directors)

161,442

 

192,216

 

Directors' fee during the year

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

£

 

£

Wong Chee Keong

19,856

 

8,750

Sayed Mustafa Ali

15,000

 

15,000

Ross Andrews

20,000

 

19,992

Leon Santos

15,000

 

15,000

 

69,856

 

58,742

 

The Directors' fees are payable to the third-party companies in respect of their services as the directors of the Group.

 

The average monthly number of employees, including directors, during the year were 12 (2020: 11).

 

 

16. SEGMENTAL ANALYSIS

 

The chief operating decision maker has determined that in the year end 31 March 2021, the Group had a single operating segment, the provision of managed telecommunications services.

 

Apart from holding Group activities in the UK the Group's operations where predominantly revenue derived from Malaysia, represents 52% (2020: 62%) of total revenue, and the remaining revenue derived from the countries within South East Asian region during the reporting year.

 

There are 2 customers (2020:3 customers) with revenue greater than 10% during the reporting year as follow:

 

 

Year ended

31 March 2021

 

Year ended

31 March 2020

 

£

 

£

Customer A

390,270

 

226,416

Customer B

-

 

134,312

Customer C

-

 

75,963

Customer D

88,073

 

-

 

545,179

 

436,691

 

 

17. FINANCIAL INSTRUMENTS

 

The Group's principal financial instruments comprise trade & other receivables and other payables. The Group's accounting policies and method adopted, including the criteria for recognition, the basis on which income and expenses are recognised in respect of each class of financial assets, financial liability and equity instrument are set out in Note 2. The Group does not use financial instruments for speculative purposes.

 

The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:

 

 

As at

31 March 2021

 

As at

31 March 2020

 

 

Financial assets

 

Loans and receivables

 

Cash and cash equivalent

 

Trade and other receivable

 

Total financial assets

633,864

 

579,784

Financial liabilities at amortised cost

 

 

 

Amount due to related company

 

Amount due to directors

 

Trade and other payables

 

Total financial liabilities

228,410

 

177,471

 

The Group uses a limited number of financial instruments, comprising cash, short-term deposits and various items such as trade receivables and payables, which arise directly from operations. The Group does not trade in financial instruments and it has no external borrowing.

 

 

18. FINANCIAL RISK MANAGEMENT

 

Financial risk factors

 

The Group's activities expose it to a variety of financial risks: currency risk, credit risk, liquidity risk and cash flow interest rate risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance.

 

a) Currency risk

 

The Group has transactional currency exposures arising from sales, and expenses that are denominated in a currency other than in Pounds Sterling. The foreign currency in which these transactions are denominated in Ringgit Malaysia ("MYR"). The Group also holds cash and cash equivalents denominated in foreign currencies, predominantly in MYR, for working capital purposes.

At the reporting date, the following Group's financial instruments are denominated in MYR:

 

 

At

31 March

2021

 

At

31 March

2020

 

£

 

£

Financial assets

 

 

 

Loans and receivables

 

 

 

Cash and cash equivalent

327,817

 

283,808

Trade and other receivable

122,872

 

60,412

Total financial assets

450,689

 

344,220

 

 

 

 

Financial liabilities at amortised cost

 

 

 

Trade and other payables

50,555

 

20,534

Total financial liabilities

50,555

 

20,534

 

 

 

 

Net financial asset

400,134

 

323,686

 

If the GBP strengthened by 5% against the MYR, with all other variables in each case remaining constant, then the impact on the group's post-tax profit for the year would be loss of approximately £19,000 (2020: loss of £12,000) or vice versa.

 

 

b) Credit risk

 

The Group's exposure to credit risk or the risk of counterparties defaulting, is primarily attributable to trade receivables. The Group manages its exposure to credit risk by the application of credit approvals, credit limits and monitoring procedures on an ongoing basis. For other financial assets (including cash and bank balances), the Group minimises credit risk by (i) customer is compulsory to place security deposit (ii) 1-month payment in advance for monthly recurring invoice (iii) no credit risk for past 12 month

 

(i)         Credit Risk Concentration Profile

 

The Group's major concentration of credit risk relates to amounts owing by one (1) customer which constitute 55% (2020: 80%) of its trade receivables as at the end of the reporting period.

 

(ii)        Exposure to credit risk

 

At the end of the financial year, the maximum exposure to credit risk is represented by the carrying amount of each class of the financial assets recognised in the statement of financial position of the company after deducting any allowance for impairment losses (where applicable)

 

(iii)       Assessment of Impairment Losses

 

At each reporting date, the Group assesses whether any of the financial assets at amortised cost are credit impaired

 

The gross carrying amounts of those financial assets are written off when there is no reasonable expectation of recovery (i.e. the debtor does not have assets or sources of income to generate sufficient cash flows to repay the debt). However, those assets are still subject to enforcement activities.

 

Trade Receivables

 

The Group applies the simplified approach to measure expected credit losses which uses a lifetime expected loss allowance for all trade receivables.

 

To measure the expected credit losses, trade receivable has been grouped based on shared credit risk characteristic and the days past due.

 

The Group considers any receivables having financial difficulty or with significant balances outstanding for more than one year, as credit impaired. However, due to the pandemic, exceptions have been granted to specified trade receivables, which is valued on case-by-case basis and subject to approval.

 

The expected loss rates are based on the payment profiles of sales over a period of 12 months from the measurement date and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle their debts.

 

The information about the exposure to credit risk and the loss allowances calculated under IFRS 9 for trade receivables is summarised below: -

 

 

Gross

ECL

Carrying

 

Amount

provision

Amount

 

£

£

£

2021

 

 

 

Current (not past due)

        79,412

              -  

        79,412

1 to 30 days past due

        61,052

              -  

        61,052

31 to 60 days past due

        11,349

              -  

        11,349

61 to 90 days past due

          8,721

              -  

          8,721

more than 90 days

        56,503

              -  

        56,503

 

      217,037

              -  

      217,037

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross

ECL

Carrying

 

Amount

Provision

Amount

 

£

£

£

2020

 

 

 

Current (not past due)

        56,812

              -  

        56,812

1 to 30 days past due

        48,914

              -  

        48,914

31 to 60 days past due

        47,026

              -  

        47,026

61 to 90 days past due

        39,736

              -  

        39,736

more than 90 days

        17,736

              -  

        17,736

 

      210,224

              -  

      210,224

 

 

Deposit with a Licensed Bank and Bank Balances

 

The company considers the banks and financial institutions have low credit risks. Therefore, the Company is of the view that the loss allowance is immaterial and hence, it is not provided for.

 

Other receivables

 

The company applies the 3-stage general approach to measuring expected credit losses for other receivables. No expected credit loss is recognised on these balances as it is negligible.

 

 

c) Liquidity risk

 

Liquidity risk arises from general funding and business activities. The Group practices prudent risk management by maintaining sufficient cash balances and adequate working capital to meet its obligations as and when they fall due The Group ensures it has adequate resource to discharge all its liabilities. The directors have considered the liquidity risk as part of their going concern assessment. (See note 2)

 

 

c) Maturity Analysis

 

The following table sets out the maturity profile of the financial liabilities at the end of the reporting period based on contractual undiscounted cash flows (including interest payments computed using contractual rates or if floating based on the rates at the end of the reporting period). The Group ensures it has adequate resource to discharge all its liabilities. The directors have considered the liquidity risk as part of their going concern assessment.

 

 

Carrying

Amount

Contractual Undiscounted cash flow

Within 1 year

More than 1 year

 

£

£

£

£

2021

 

 

 

 

Trade and other payables

225,406

225,406

225,406

-

Amount due to directors

3,004

3,004

3,004

-

Lease liabilities

223,726

  238,095

105,820  

132,275  

 

      452,136

466,505

334,230

      132,275

 

 

 

 

 

2020

 

 

 

 

Trade and other payables

83,631

83,631

83,631

-

Amount due to directors

4,166

4,166

4,166

-

Amount due to related company

89,674

89,674

89,674

-

Lease liabilities

73,825

  75,963

75,963

-  

 

251,296

253,434

253,434

-

 

 

Fair values

 

Management assessed that the fair values of cash and short-term deposits, trade receivables, trade payables and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

 

 

19. CAPITAL RISK MANAGEMENT POLICY

 

The Group defines capital as the total equity and debt of the Group. The objective of the Group's capital management is to safeguard and maintain the Group's ability to continue as a going concern in order to provide returns to and benefits for all stakeholders and to maintain an optimal capital structure to reduce the cost of capital and towards ensuring availability of funds in order to support its businesses and related shareholders value. To achieve this objective, the Group may make adjustments to the capital structure in view of changes in economic conditions such as adjusting the amount of dividend payments or issuing new shares. The capital structure of the Group consists of the equity attributable to equity holders of the Group which comprises of issued share capital and reserves.

 

The Group monitors and maintains a prudent level of total debt to total equity ratio to optimise shareholders value and to ensure compliance with debt covenants and regulatory,

 

There was no change in the Group's approach to capital management during the financial year.

 

20. NET DEBT RECONCILIATION

 

The below table sets out an analysis of net debt and the movement in net debt for the years presented:

 

 

31 March 2021

 

31 March 2020

 

£

 

£

 

 

 

 

Cash and cash equivalent

391,783

 

350,692

Lease liabilities

(223,726)

 

(73,825)

 

168,057

 

276,867

 

 

 

Cash and cash equivalent

Lease liabilities

Total

 

£

£

£

 

 

 

 

Net debt as at 1 April 2019

529,278

-

529,278

Cash flow

(180,324)

92,690

(87,634)

New lease

-

(166,515)

(166,515)

Effect of foreign exchange

1,738

-

1,738

Net debt as at 31 March 2020

350,692

(73,825)

276,867

Cash flow

63,255

90,885

154,140

New lease

-

(292,474)

(292,474)

Other changes

-

51,688

51,688

Effect of foreign exchange

(22,164)

-

(22,164)

Net debt as at 31 March 2021

391,783

(223,726)

168,057

 

 

21. RELATED PARTY TRANSACTIONS

 

Key management are considered to be the directors and the key management personnel compensation has been disclosed in note 15.

 

In 2017, Orient Managed Services Limited entered into an agreement with a third party which provides consultancy services in relation to the listing exercise of the Group. Orient Managed Services Limited is partly owned by Sayed Mustafa Ali, a director of the Group.

 

 

31 March 2021

 

31 March 2020

 

£

 

£

Amount due to related party

 

 

 

-    Orient Managed Services Limited

-

 

44,391

-    Orient Telecoms Sdn Bhd

-

 

45,283

Amount due to directors

 

 

 

-    Sayed Mustafa Ali

1,250

 

1,250

-    Wong Chee Keong

1,754

 

-

-    Ross Andrews

-

 

1,666

-    Leon Santos

-

 

1,250

 

3,004

 

4,166

 

The amount due to the related parties are interest-free and is payable on demand.

 

 

 

 

Sayed Mustafa Ali is a director in both, the Group and Orient Telecoms Sdn Bhd.

 

 

 

22. CONTROL

 

The directors consider there is no ultimate controlling party.

 

 

23. SUBSEQUENT EVENTS

 

There were no subsequent events after the reporting period.

 

 

 

 

 

As at

31 March

2021

 

As at

31 March

2020

 

Notes

£

 

£

ASSETS

 

 

 

 

 

 

 

 

 

NON-CURRENT ASSETS

 

 

 

 

Investment in subsidiary

4

517,574

 

366,696

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

Bank

 

63,967

 

66,884

Trade and other receivables

5

119,207

 

168,680

 

 

183,174

 

235,564

 

 

 

 

 

TOTAL ASSETS

 

700,748

 

602,260

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

 

 

 

 

 

EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY

 

 

 

 

Share capital

 

1,000,000

 

1,000,000

Accumulated loss

 

(477,106)

 

(554,677)

TOTAL EQUITY

 

522,894

 

445,323

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

Amount due to directors

 

3,004

 

-

Trade and other payables

6

174,850

 

156,937

 

 

177,854

 

156,937

TOTAL EQUITY AND LIABILITIES

 

700,748

 

602,260

COMPANY STATEMENT OF FINANCIAL POSITION

AT 31 MARCH 2021

 

The profit for the Company for the year ended 31 March 2021 was £77,571 (2020: £10,090).

 

The notes to the financial statements form an integral part of these financial statements.

 

This report was approved and authorised for issue by the Board of Directors on 09 September, 2021 and signed on behalf by:

 

 

 

Sayed Mustafa Ali

Director

 

Registered number: 10028222

 

COMPANY STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 MARCH 2021

 

 

 

Share capital

 

Accumulated loss

 

Total

 

£

 

£

 

£

 

 

 

 

 

 

As at 1 April 2019

1,000,000

 

(564,767)

 

435,233

 

 

 

 

 

 

Profit for the year

 

 

10,090

 

10,090

Total comprehensive income for the year

 

 

10,090

 

10,090

 

 

 

 

 

 

As at 31 March 2020

1,000,000

 

(554,677)

 

445,323

 

 

Profit for the year

 

 

77,571

 

77,571

Total comprehensive income for the year

 

 

77,571

 

77,571

 

 

 

 

 

 

As at 31 March 2021

1,000,000

 

(477,106)

 

522,894

 

 

 

 

 

Share capital comprises the ordinary issued share capital of the Company.

 

Accumulated loss represents the aggregate retained earnings of the Company.

 

The notes to the financial statements form an integral part of these financial statements.

 

 

 

NOTES TO THE COMPANY FINANCIAL STATEMENT

For the year ended 31 MARCH 2021

 

1.   General information

 

The Company was incorporated in England and Wales on 26 February 2016, as a public company limited by shares under the Act. The principal legislation under which the Company operates is the Act. The registered office of the Group is at the offices of London Registrar, Suite A, 6 Honduras St, London EC1Y 0TH United Kingdom.

 

2.   Accounting policies

 

Basis of preparation

 

The financial statements have been prepared in accordance with the historical cost convention. The financial statements have been prepared in accordance with FRS 101 - The Financial Reporting Standard applicable in the UK and Republic of Ireland and the Companies Act 2006. The principal accounting policies are described below.

 

The Company meets the definition of a qualifying entity under FRS 101 and has therefore taken advantage of the disclosure exemptions available to it in respect of its separate financial statements, which are presented alongside the consolidated financial statements. Exemptions have been taken in relation to financial instruments, presentation of a cash flow statement and remuneration of key management personnel.

 

The Company has taken advantage of section 408 of the Companies Act 2006 and, consequently, a profit and loss account for the Company alone has not been presented.

 

Investment

 

Investments in subsidiaries are stated at cost less provision for impairment. Intercompany receivables are regarded as net investment which is subject to the impairment assessment whenever events or changes in circumstances indicate that the carrying value of these investment and intercompany receivables may not be recoverable.

 

 

Cash and cash equivalents

 

Cash in the statement of financial position is cash held on call with banks.

 

Financial assets

 

The directors classify the Company's loan and receivable as financial assets held at amortised cost less provisions for impairment.

 

The directors determine the classification of its financial assets at initial recognition.

 

 

 

 

 

Financial liabilities

 

Financial liabilities are classified as financial liabilities measured at amortised cost.

 

Creditors

 

Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 

Taxation

 

Tax is recognised in the Statement of comprehensive income, except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

 

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

 

Deferred tax balances are recognised in respect of all temporary differences that have originated but not reversed by the Statement of financial position date, except that:

 

•   The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and

•   Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

 

 

3.   Staff costs

 

The directors are regarded as the key management and their remunerations are disclosed in note 15 to the consolidated financial statements.

 

4.   Investment in subsidiary

 

Cost of investment

 

Loan to group undertaking

 

Total

 

£

 

£

 

£

 

 

 

 

 

 

Addition

93,800

 

-

 

93,800

Advance loan to group undertaking

-

 

406,200

 

406,200

Balance as at 1 April 2019

93,800

 

406,200

 

500,000

Repayment of intercompany loan

-

 

(133,304)

 

(133,304)

Balance as at 1 April 2020

93,800

 

272,896

 

366,696

Advance loan to group undertaking

-

 

150,878

 

150,878

Balance as at 31 Mar 2021

93,800

 

423,774

 

517,574

 

The loan was advanced to the subsidiary to support and fund certain operational costs required in the business and there is no contractual obligation on the subsidiary to repay these loans. Judgment has been applied and classified the loan to group undertaking as part of the cost of investment in the subsidiary.

 

The company is required to assess the carrying value of the investment in subsidiary and loans to group undertaking for impairment. Recoverable value of these balances is dependent upon the subsidiary producing sufficient cash surplus such that the subsidiary achieves a positive net asset position.

 

The details of the subsidiary are set out in the note 14 to the consolidated financial statements.

 

5.   Trade and other receivables

 

 

As at

31 March 2021

 

As at

31 March 2020

 

£

 

£

Trade receivables

119,207

 

168,680

 

119,207

 

168,680

 

 

6.   Trade and other payables

 

 

As at

31 March 2021

 

As at

31 March 2020

 

£

 

£

Amount due to related company

-

 

89,674

Amount due to directors

3,004

 

4,166

 

 

 

 

Trade creditors

134,551

 

35,847

Accruals

14,482

 

27,250

Other payables

25,817

 

-

 

177,854

 

156,937

 

The detail of the related company is set out in the note 20 to the consolidated financial statements.

 

7.   Share capital

 

The details are set out in the note 11 to the consolidated financial statements.

 

At 31 March 2021, the total number of issued ordinary shares of the Company was 10,000,000.

 

 

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