Annual Report & Accounts 2026
77
OUR FINANCIALS
paid for the work once the client has paid the invoice, the credit exposure is minimised to the gross profit margin element of any given invoice. Credit risk with cash and cash equivalents is reduced by placing funds with banks with high credit ratings.
LIQUIDITY RISK
The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. Any liquidity risk is substantially reduced as the Group’s principal liability, that of the lawyers’ fees, is only payable once the clients have paid the invoices to which these fees relate.
The Board receives cash flow projections on a regular basis, which are monitored regularly. The Board will not commit to material expenditure in respect of its ongoing development programme prior to being satisfied that sufficient funding is available to the Group to finance the planned programmes. INTEREST RATE RISK
There is no significant interest rate risk in respect of temporary surplus funds invested in deposits and other interest-bearing accounts with financial institutions, as the operations of the Group are not dependent on the finance income received.
CAPITAL RISK MANAGEMENT
The Group considers its capital to comprise its ordinary share capital and retained profits as its equity capital. In managing its capital, the Group’s primary objective is to provide return for its equity shareholders through capital growth and future dividend income. The Group’s policy is to seek to maintain a gearing ratio that balances risks and returns at an acceptable level and to maintain a sufficient funding base to enable the Group to meet its working capital and strategic investment needs. In making decisions to adjust its capital structure to achieve these aims, either through new share issues or the issue of debt, the Group considers not only its short-term position, but also its long-
term operational and strategic objectives.
Details of the Group’s capital are disclosed in the Statement of Changes in Equity.
There have been no other significant changes to the Group’s management objectives, policies and procedures in the year, nor has there been any change in what the Group considers to be capital.
CURRENCY RISK
The Group is not exposed to any significant currency risk.
28. RESERVES
SHARE PREMIUM
The balance of the share premium account represents the value received for shares issued above their nominal value net of transaction costs.
SHARE-BASED PAYMENTS RESERVE
The balance of the share-based payments reserve represents the cumulative expense charged to the statement of comprehensive income in respect of share-based payments.
RETAINED EARNINGS
The balance of the retained earnings reserve represents the cumulative profits of the business net of distributions made to shareholders.
OUR FINANCIALS
paid for the work once the client has paid the invoice, the credit exposure is minimised to the gross profit margin element of any given invoice. Credit risk with cash and cash equivalents is reduced by placing funds with banks with high credit ratings.
LIQUIDITY RISK
The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. Any liquidity risk is substantially reduced as the Group’s principal liability, that of the lawyers’ fees, is only payable once the clients have paid the invoices to which these fees relate.
The Board receives cash flow projections on a regular basis, which are monitored regularly. The Board will not commit to material expenditure in respect of its ongoing development programme prior to being satisfied that sufficient funding is available to the Group to finance the planned programmes. INTEREST RATE RISK
There is no significant interest rate risk in respect of temporary surplus funds invested in deposits and other interest-bearing accounts with financial institutions, as the operations of the Group are not dependent on the finance income received.
CAPITAL RISK MANAGEMENT
The Group considers its capital to comprise its ordinary share capital and retained profits as its equity capital. In managing its capital, the Group’s primary objective is to provide return for its equity shareholders through capital growth and future dividend income. The Group’s policy is to seek to maintain a gearing ratio that balances risks and returns at an acceptable level and to maintain a sufficient funding base to enable the Group to meet its working capital and strategic investment needs. In making decisions to adjust its capital structure to achieve these aims, either through new share issues or the issue of debt, the Group considers not only its short-term position, but also its long-
term operational and strategic objectives.
Details of the Group’s capital are disclosed in the Statement of Changes in Equity.
There have been no other significant changes to the Group’s management objectives, policies and procedures in the year, nor has there been any change in what the Group considers to be capital.
CURRENCY RISK
The Group is not exposed to any significant currency risk.
28. RESERVES
SHARE PREMIUM
The balance of the share premium account represents the value received for shares issued above their nominal value net of transaction costs.
SHARE-BASED PAYMENTS RESERVE
The balance of the share-based payments reserve represents the cumulative expense charged to the statement of comprehensive income in respect of share-based payments.
RETAINED EARNINGS
The balance of the retained earnings reserve represents the cumulative profits of the business net of distributions made to shareholders.