xbrli:pureiso4217:DKK333554162021-01-012021-12-31cmn:ConsolidatedMember333554162021-01-012021-12-311cmn:ConsolidatedMember333554162021-01-012021-12-311cmn:ConsolidatedMember333554162021-01-012021-12-311333554162021-01-012021-12-312333554162021-01-012021-12-313333554162021-01-012021-12-314333554162020-01-012020-12-31cmn:ConsolidatedMember333554162021-01-012021-12-31333554162020-01-012020-12-31333554162021-01-012021-12-31fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:RetainedEarningsMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:RetainedEarningsMembercmn:ConsolidatedMember333554162020-01-012020-12-31fsa:RetainedEarningsMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMember333554162021-01-012021-12-31fsa:ReserveForNetRevaluationAccordingToEquityMethodMember333554162021-01-012021-12-31fsa:RetainedEarningsMember333554162021-01-012021-12-31fsa:RetainedEarningsMember333554162020-01-012020-12-31fsa:RetainedEarningsMember333554162021-12-31cmn:ConsolidatedMember333554162020-12-31cmn:ConsolidatedMember333554162021-12-31333554162020-12-31333554162021-01-01cmn:ConsolidatedMember333554162020-01-01cmn:ConsolidatedMember333554162021-01-01fsa:ContributedCapitalMembercmn:ConsolidatedMember333554162021-01-01fsa:SharePremiumMembercmn:ConsolidatedMember333554162021-01-01fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMembercmn:ConsolidatedMember333554162021-01-01fsa:ReserveForDevelopmentExpenditureMembercmn:ConsolidatedMember333554162021-01-01fsa:RetainedEarningsMembercmn:ConsolidatedMember333554162021-12-31fsa:ContributedCapitalMembercmn:ConsolidatedMember333554162021-12-31fsa:SharePremiumMembercmn:ConsolidatedMember333554162021-12-31fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMembercmn:ConsolidatedMember333554162021-12-31fsa:ReserveForDevelopmentExpenditureMembercmn:ConsolidatedMember333554162021-12-31fsa:RetainedEarningsMembercmn:ConsolidatedMember333554162021-01-01fsa:ContributedCapitalMember333554162021-01-01fsa:SharePremiumMember333554162021-01-01fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMember333554162021-01-01fsa:ReserveForNetRevaluationAccordingToEquityMethodMember333554162021-01-01fsa:ReserveForDevelopmentExpenditureMember333554162021-12-31fsa:ContributedCapitalMember333554162021-12-31fsa:SharePremiumMember333554162021-12-31fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMember333554162021-12-31fsa:ReserveForNetRevaluationAccordingToEquityMethodMember333554162021-12-31fsa:ReserveForDevelopmentExpenditureMember333554162021-01-01fsa:RetainedEarningsMember333554162021-01-01333554162021-12-31fsa:RetainedEarningsMember333554162021-01-012021-12-31fsa:ContributedCapitalMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:SharePremiumMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:ContributedCapitalMember333554162021-01-012021-12-31fsa:SharePremiumMember333554162021-01-012021-12-31fsa:ReserveForDevelopmentExpenditureMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:ReserveForDevelopmentExpenditureMember333554162021-01-012021-12-311cmn:ConsolidatedMember333554162021-01-012021-12-312cmn:ConsolidatedMember333554162020-01-012020-12-311cmn:ConsolidatedMember333554162020-01-012020-12-312cmn:ConsolidatedMember333554162021-01-012021-12-31fsa:ShorttermDeferredIncomeMembercmn:ConsolidatedMember333554162021-01-012021-12-31fsa:OtherShorttermPayablesMember333554162021-01-012021-12-31fsa:ShorttermDeferredIncomeMemberGrundlag for konklusionKonklusion2022-07-042022-07-0433963556Deloitte Statsautoriseret RevisionspartnerselskabRevisionspåtegningRegnskabsklasse C, mellemstor virksomhed2020-12-312020-01-0133963556Weidekampsgade 6Deloitte Statsautoriseret Revisionspartnerselskab2300 København S2021-12-312021-01-01Inscale A/S33355416ÅrsrapportEsbjerg67018DokkenCopenhagenCopenhagen K13604<br /><br />11, 4FrederiksborggadeThe Board of Directors and the Executive Board have today considered and approved the annual report of Inscale A/S for the financial year 01.01.2021 - 31.12.2021.The annual report is presented in accordance with the Danish Financial Statements Act.In our opinion, the consolidated financial statements and the parent financial statements give a true and fair view of the Group's and the Parent's financial position at 31.12.2021 and of the results of their operations and the consolidated cash flows for the financial year 01.01.2021 - 31.12.2021.We believe that the management commentary contains a fair review of the affairs and conditions referred to therein.We recommend the annual report for adoption at the Annual General Meeting.CopenhagenHenrik MouPeter Vejlgaard ArbsHenrik MouUlla Berg MouPaul Mark Braem VedelChairmanTo the shareholders of Inscale A/SWe have audited the consolidated financial statements and the parent financial statements of Inscale A/S for the financial year 01.01.2021 - 31.12.2021, which comprise the income statement, balance sheet, statement of changes in equity and notes, including a summary of significant accounting policies, for the Group as well as the Parent, and the consolidated cash flow statement. The consolidated financial statements and the parent financial statements are prepared in accordance with the Danish Financial Statements Act. ​ ​In our opinion, the consolidated financial statements and the parent financial statements give a true and fair view of the Group's and the Parent's financial position at 31.12.2021 and of the results of their operations and the consolidated cash flows for the financial year 01.01.2021 - 31.12.2021 in accordance with the Danish Financial Statements Act.We conducted our audit in accordance with International Standards on Auditing (ISAs) and additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further ​described in the "Auditor’s responsibilities for the audit of the consolidated financial statements and the parent financial statements" section of this auditor’s report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.Management is responsible for the preparation of consolidated financial statements and parent financial statements that give a true and fair view in accordance with the Danish Financial Statements Act, and for such internal control as Management determines ​is necessary to enable the preparation of consolidated financial statements and parent financial statements that are free from material misstatement, ​whether due to fraud or error. ​ ​In preparing the consolidated financial statements and the parent financial statements, Management is responsible for assessing the Group's and the Entity’s ability to continue ​as a going concern, for disclosing, as applicable, matters related to going concern, and for using the going ​concern basis of accounting in preparing the consolidated financial statements and the parent financial statements unless Management either intends to liquidate ​the Entity or to cease operations, or has no realistic alternative but to do so.Our objectives are to obtain reasonable assurance about whether the consolidated financial statements and the parent 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 and the additional requirements applicable in Denmark 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 consolidated financial statements and parent financial statements. ​ ​As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, ​we exercise professional judgement and maintain professional scepticism throughout the audit. We also:<br />Identify and assess the risks of material misstatement of the consolidated financial statements and the parent financial statements, whether due to ​fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence ​that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a ​material misstatement resulting from fraud is higher than for one resulting from error, as fraud may ​involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. <br />Obtain an understanding of internal control relevant to the audit in order to design audit procedures ​that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the ​effectiveness of the Group's and the Entity’s internal control. <br />Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates ​and related disclosures made by Management. <br />Conclude on the appropriateness of Management’s use of the going concern basis of accounting in ​preparing the consolidated financial statements and the parent financial statements, and, based on the audit evidence obtained, whether a material ​uncertainty exists related to events or conditions that may cast significant doubt on the Group's and the Entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to ​draw attention in our auditor’s report to the related disclosures in the consolidated financial statements and the parent financial statements or, if such ​disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence ​obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group and the ​Entity to cease to continue as a going concern. <br />Evaluate the overall presentation, structure and content of the consolidated financial statements and the parent financial statements, including the disclosures ​in the notes, and whether the consolidated financial statements and the parent financial statements represent the underlying transactions and ​events in a manner that gives a true and fair view.<br />We communicate with those charged with governance regarding, among other matters, the planned scope ​and timing of the audit and significant audit findings, including any significant deficiencies in internal control ​that we identify during our audit.Management is responsible for the management commentary. ​ ​Our opinion on the consolidated financial statements and the parent financial statements does not cover the management commentary, and we do not express ​any form of assurance conclusion thereon. ​ ​In connection with our audit of the consolidated financial statements and the parent financial statements, our responsibility is to read the management ​commentary and, in doing so, consider whether the management commentary is materially inconsistent with ​the consolidated financial statements and the parent financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. ​Moreover, it is our responsibility to consider whether the management commentary provides the information ​required under the Danish Financial Statements Act.<br />Based on the work we have performed, we conclude that the management commentary is in accordance with ​the consolidated financial statements and the parent financial statements and has been prepared in accordance with the requirements of the Danish Financial ​Statements Act. We did not identify any material misstatement of the management commentary.EsbjergMikael Grosbølmne33707State Authorised Public AccountantFinancial highlights2021 DKK'0002020 DKK'0002019 DKK'0002018 DKK'0002017 DKK'000Key figuresRevenue195,429174,048168,026133,28657,828Gross profit/loss144,501130,521124,42689,2932.734Operating profit/loss(3,838)9792,735(430)398Net financials(2,391)(3,167)(1,711)(1,215)(999)Profit/loss for the year(8,087)(2,554)600(1,520)(594)Balance sheet total68,21156,29354,62144,53320,396Investments in property, plant and equipment3,9988,98315,6525290Equity5,3809094,5307,3734,655RatiosGross margin (%)74.9974.9974.0566.994.72Net margin (%)(4.14)(1.47)0.36(1.14)(1.03)Return on equity (%)(93.91)(93.91)10.08(25.27)(15.03)Equity ratio (%)7.891.618.2916.5622.82Financial highlights are defined and calculated in accordance with the current version of "Recommendations & Ratios" issued by the CFA Society Denmark.Gross margin (%):Gross profit/loss * 100 ​RevenueNet margin (%) : Profit/loss for the year * 100 ​RevenueReturn on equity (%) :Profit/loss for the year * 100 ​​Average equityEquity ratio (%) :​Equity * 100 ​​Balance sheet total Primary activitiesINSCALE support domestic and international business clients’ strategy through providing dedicated software development teams and -resources. INSCALE always builds through a strategic partnership with our clients. All the teams work from one of our offshore development locations. INSCALE manages and advises on the remote software development process between the client and INSCALE’s offshore development location. In providing services to the client, the team works on application development and maintenance of the client’s core software solutions. In doing so, the team will be a strategic resource pool for clients’ on-going software development efforts. The collaboration and the partnership between INSCALE and the Client are a long-term relationship to give team members the best opportunity to acquire in depth knowledge of client’s business and software solutions, so INSCALE enables our clients to leverage on our engagement model for their business excellence. By adopting INSCALE’s approach to building dedicated software development teams, our clients can extend their reach beyond their location into a wider pool of offshore developers and close technology gaps within their existing software development resources. INSCALE is a player in the international market, where we all focus a huge need for software developers, as IT is fundamentally for many business’ all over the world. INSCALE has a solution for this and believe that our footprint in the sector is powerful and has been consistent for many years and this will continue. Development in activities and financesINSCALE has experienced solid growth internationally in recent years. Many clients in 10 countries have experienced this long-term partnership with a great success. INSCALE has experienced a positive development in revenue in 2021 as we reached 195 MDKK, however the costs have increased in 2021. The final result is of a loss of 8,1 MDKK before tax. The loss for the year is still affected by costs regards to the establishment of the entity and one time cost for employees vacancies in Portugal and finally due to introduction of cost-plus model for all off-shore locations. The board decided in the Board meeting in November 2021 to ask the shareholders to support INSCALE with 12 MDKK. The amount was granted by December 2021. The Parent company HFUNK ApS has confirmed to support INSCALE A/S financially. The COVID 19 pandemic has changed some significant conditions for INSCALE business. As consequence the ambitious growth plan set up towards 2024 has been delayed, however we are in process to develop and adjust to the new ways. The sales process has been changed and we needed to invest in new marketing/ sales activities, as psychical meetings were limited. In our upstream activities we experience many software developers worked from home (WFH) during the pandemic. We have experienced the request later on and will take advantage of this in new concepts for relevant clients. Despite these changes we continued to strengthen the organization to develop and service clients and soft developers to ensure a strong alignment with the changing conditions and be prepared for the expected future growth. Profit/loss for the year in relation to expected developmentsThe growth was lower than expected, but still positive with 12%. The profit for the year was lower than expected.OutlookWe expect to return to our previous growth rate of ​+20% in 2022. A net profit between zero and +5 mio. DKK in 2022 is expected. We acknowledge the change in the geopolitical world. The effects from the COVID pandemic with a significant change in WFH, the war I Europe / Ukraine, the significant drop in financial markets will all influence business’s, our potential clients, our employees, nevertheless we are confident to the need for our services and we in 2022 will introduce new services to align the market.Events after the balance sheet dateNo events have occurred after the balance sheet date to this date, which would influence the evaluation of this annual report. 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to group enterprisesChanges of short term bank debt-939510-115957206352831-20210826377443-31913821076871943912761 Staff costs2021 DKK2020 DKKWages and salaries126,597,897112,433,429Pension costs422,5250Other social security costs13,367,71310,149,249Other staff costs1,496,1101,116,441141,884,245123,699,119Average number of full-time employees455416Remuneration to the executive board has not been disclosed in accordance with section 98b (3) of the Danish Financial Statements Act.1 Staff costs2021 DKK2020 DKKWages and salaries3,800,3433,999,812Pension costs422,525381,421Other staff costs46,47359,9944,269,3414,441,227Average number of full-time employees55455416552 Depreciation, amortisation and impairment losses2021 DKK2020 DKKAmortisation of intangible assets1,106,973814,789Depreciation on property, plant and equipment5,362,2145,005,753Profit/loss from sale of intangible assets and property, plant and equipment(14,714)21,5766,454,4735,842,1183 Other financial income2021 DKK2020 DKKExchange rate adjustments2,910,9612,440,0842,910,9612,440,0842 Other financial income2021 DKK2020 DKKExchange rate adjustments2,910,9612,440,0842,910,9612,440,0844 Other financial expenses2021 DKK2020 DKKFinancial expenses from group enterprises705,000725,606Other interest expenses476,530521,908Exchange rate adjustments4,116,6514,359,905Other financial expenses3,67905,301,8605,607,4192021 DKK2020 DKKFinancial expenses from group enterprises705,000725,606Other interest expenses476,530521,908Exchange rate adjustments4,116,6514,359,905Other financial expenses3,67905,301,8605,607,419<br />3 Other financial expenses2021 DKK2020 DKKFinancial expenses from group enterprises705,000720,000Other interest expenses370,022329,925Exchange rate adjustments3,239,2363,510,583Other financial expenses3,6795,6064,317,9374,566,114<br />2021 DKK2020 DKKFinancial expenses from group enterprises705,000720,000Other interest expenses370,022329,925Exchange rate adjustments3,239,2363,510,583Other financial expenses3,6795,6064,317,9374,566,1145 Tax on profit/loss for the year2021 DKK2020 DKKCurrent tax1,807,000340,235Change in deferred tax51,68426,2031,858,684366,4386 Proposed distribution of profit/loss2021 DKK2020 DKKRetained earnings(8,087,365)(2,554,284)(8,087,365)(2,554,284)4 Proposed distribution of profit and loss2021 DKK2020 DKKRetained earnings(8,087,365)(2,554,284)(8,087,365)(2,554,284)7 Intangible assetsCompleted development projects DKKDevelopment projects in progress DKKCost beginning of year5,048,487848,494Transfers1,022,414(1,022,414)Additions1,455,314173,920Cost end of year7,526,2150Amortisation and impairment losses beginning of year(814,789)0Amortisation for the year(1,106,973)0Amortisation and impairment losses end of year(1,921,762)0Carrying amount end of year5,604,4530Completed development projects DKKDevelopment projects in progress DKKCost beginning of year5,048,487848,494Transfers1,022,414(1,022,414)Additions1,455,314173,920Cost end of year7,526,2150Amortisation and impairment losses beginning of year(814,789)0Amortisation for the year(1,106,973)0Amortisation and impairment losses end of year(1,921,762)0Carrying amount end of year5,604,4530<br />5 Intangible assetsCompleted development projects DKKDevelopment projects in progress DKKCost beginning of year5,048,487848,494Transfers1,022,414(1,022,414)Additions1,455,314173,920Cost end of year7,526,2150Amortisation and impairment losses beginning of year(814,789)0Amortisation for the year(1,106,973)0Amortisation and impairment losses end of year(1,921,762)0Carrying amount end of year5,604,4530<br />Completed development projects DKKDevelopment projects in progress DKKCost beginning of year5,048,487848,494Transfers1,022,414(1,022,414)Additions1,455,314173,920Cost end of year7,526,2150Amortisation and impairment losses beginning of year(814,789)0Amortisation for the year(1,106,973)0Amortisation and impairment losses end of year(1,921,762)0Carrying amount end of year5,604,45308 Development projectsThe groups development projects relate to the development and improvement of the Inscale ERP System. Development project assets are measured at net cost value, and is impairment tested on a yearly basis.6 Development projectsDevelopment projects relate to the development and improvement of the Inscale ERP System. Development project assets are measured at net cost value, and is impairment tested on a yearly basis. 9 Property, plant and equipmentOther fixtures and fittings, tools and equipment DKKProperty, plant and equipment in progress DKKCost beginning of year28,995,8135,961,279Exchange rate adjustments936,4340Transfers5,961,279(5,961,279)Additions3,997,9710Disposals(183,743)0Cost end of year39,707,7540Depreciation and impairment losses beginning of year(11,998,801)0Exchange rate adjustments(842,891)0Depreciation for the year(5,362,214)0Reversal regarding disposals174,1010Depreciation and impairment losses end of year(18,029,805)0Carrying amount end of year21,677,9490Recognised assets not owned by Entity381,69307 Property, plant and equipmentOther fixtures and fittings, tools and equipment DKKCost beginning of year2,332,956Additions40,080Cost end of year2,373,036Depreciation and impairment losses beginning of year(940,412)Depreciation for the year(660,348)Depreciation and impairment losses end of year(1,600,760)Carrying amount end of year772,27610 Financial assetsOther investments DKKDeposits DKKCost beginning of year01,416,081Additions2,595,1266,324Cost end of year2,595,1261,422,405Carrying amount end of year2,595,1261,422,4058 Financial assetsInvestments in group enterprises DKKOther investments DKKDeposits DKKCost beginning of year2,738,48201,416,081Additions02,595,1266,324Cost end of year2,738,4822,595,1261,422,405Revaluations beginning of year6,290,33400Exchange rate adjustments724,40200Transfers(1,259,435)00Share of profit/loss for the year8,467,90300Investments with negative equity value transferred to provisions (4,257,528)00Revaluations end of year9,965,67600Impairment losses beginning of year(1,259,435)00Transfers1,259,43500Impairment losses end of year000Carrying amount end of year12,704,1582,595,1261,422,405A specification of investments in subsidiaries is evident from the notes to the consolidated financial statements.11 Deferred tax ​Changes during the year2021 DKK2020 DKKBeginning of year314,041340,244Recognised in the income statement(51,684)(26,203)End of year262,357314,041The capitalized tax assets consists only of tax losses from the groups malaysian subsidiary. ​Deferred tax assetsDeferred tax assets are measured at net realizable value, and are based on Management's best estimate.12 PrepaymentsPrepayments consist of insurance, subscription fees, etc. in respect of subsequent financial years.9 PrepaymentsPrepayments consists of insurance, subscriptions fees etc.13 Contributed capitalNumberPar value DKKNominal ​value DKKClass A - shares1,090,0001.001,090,000Class A -shares (Capital increase 2021)430,0001.00430,0001,520,0001,520,00014 Non-current liabilities other than provisionsDue within 12 months 2021 DKKDue within 12 ​months 2020 DKKDue after more than 12 months 2021 DKKBank loans1,024,923968,3432,083,668Lease liabilities265,519534,8310Debt to other credit institutions1,733,1981,502,148580,8863,023,6403,005,3222,664,554The Group has no long-term debt that is due more than 5 years from the balance sheet date.11 Non-current liabilities other than provisionsDue within 12 months 2021 DKKDue within 12 ​months 2020 DKKDue after more than 12 months 2021 DKKBank loans1,024,923968,3432,083,668Debt to other credit institutions1,733,1982,470,491580,8862,758,1213,438,8342,664,554The Company has no long-term debt that is due more than 5 years from the balance sheet date. 15 Payables to group enterprisesPayables to group enterprises consists of a loan from HFUNK ApS.16 Deferred incomeDeferred income consists of revenue to be recognized in future periods as the recognition criteria has not been completed yet.12 Other payables2021 DKK2020 DKKVAT and duties1,747,8971,960,057Other costs payable4,742,159917,8106,490,0562,877,86713 Deferred incomeShort-term deferred income include deferred revenue.17 Changes in working capital2021 DKK2020 DKKIncrease/decrease in receivables(1,961,099)(103,607)Increase/decrease in trade payables etc.12,833,627(590,537)Other changes630,8594,918,04911,503,3874,223,90518 Unrecognised rental and lease commitments2021 DKK2020 DKKTotal liabilities under rental or lease agreements until maturity 28,027,99728,829,65214 Unrecognised rental and lease commitments2021 DKK2020 DKKTotal liabilities under rental or lease agreements until maturity 738,0891,159,68919 Contingent liabilitiesThe Parent and the Danish subsidiaries participate in a Danish joint taxation arrangement in which HFUNK ApS serves as the administration company. According to the joint taxation provisions of the Danish Corporation Tax Act, the Parent and the Danish subsidiaries are therefore secondarily liable for income taxes etc. for the jointly taxed entities, limited to the equity interest by which the Entity participates in the Group, and also secondarily liable for obligations, if any, relating to the withholding of tax on interest, royalties and dividends for the jointly taxed entities. The jointly taxed entities' total known net liability under the joint taxation arrangement is disclosed in the administration company's financial statements.15 Contingent liabilitiesThe Entity participates in a Danish joint taxation arrangement in which HFUNK ApS serves as the administration company. According to the joint taxation provisions of the Danish Corporation Tax Act, the Entity is therefore secondarily liable for income taxes etc. for the jointly taxed entities, limited to the equity interest by which the Entity participates in the Group, and also secondarily liable for obligations, if any, relating to the withholding of tax on interest, royalties and dividends for the jointly taxed entities. The jointly taxed entities' total known net liability under the joint taxation arrangement is disclosed in the administration company's financial statements.20 Assets charged and collateralThe group has not itself provided collateral or made mortages.16 Assets charged and collateralThe company itself ha not itself provided collateral or made mortages.21 Non-arm’s length related party transactionsOnly non-arm's length related party transactions are disclosed in the annual report.​ No such transactions were conducted during the financial year.18 Non-arm’s length related party transactionsOnly non-arm's length related party transactions are disclosed in the annual report.​ No such transactions were conducted during the financial year.22 Group relationsName and registered office of the Parent preparing consolidated financial statements for the largest group: HFUNK ApS, CopenhagenName and registered office of the Parent preparing consolidated financial statements for the smallest group: HFUNK ApS, Copenhagen23 SubsidiariesRegistered inCorporate ​formOwnership ​​%Inscale AsiaMalaysiaSDN Bhd100Inscale FacilitationMalaysiaSDN Bhd100Inscale PortugalPortugalLtd.100Inscale QT UkraineUkraineLLC100Inscale Ukraine UkraineLtd.10019465693516188483284679031918074127041587769381142232045030899042575280425752810 Provisions for investments in group enterprisesProvisions for investments in group enterprises consists of provisions for negativ equity in subsidiaries.17 Related parties with controlling interestHFUNK ApS, Holte, Denmark (parent company) Henrik Mou, Fredsvej 7, 2840 Holte, Denmark (owns 100% of HFUNK ApS)This annual report has been presented in accordance with the provisions of the Danish Financial Statements Act governing reporting class C enterprises (medium) with addition of a few provisions governing reporting class C enterprises (large).The accounting policies applied to these consolidated financial statements and parent financial statements are consistent with those applied last year.falseRecognition and measurementAssets are recognised in the balance sheet when it is probable as a result of a prior event that future economic ​benefits will flow to the Entity, and the value of the asset can be measured reliably. ​ ​Liabilities are recognised in the balance sheet when the Entity has a legal or constructive obligation as a ​result of a prior event, and it is probable that future economic benefits will flow out of the Entity, and the ​value of the liability can be measured reliably. ​ ​On initial recognition, assets and liabilities are measured at cost. Measurement subsequent to initial ​recognition is effected as described below for each financial statement item. ​ ​Anticipated risks and losses that arise before the time of presentation of the annual report and that confirm ​or invalidate affairs and conditions existing at the balance sheet date are considered at recognition and ​measurement. ​ ​Income is recognised in the income statement when earned, whereas costs are recognised by the amounts ​attributable to this financial year. <br />Consolidated financial statementsThe consolidated financial statements comprise the Parent and the group enterprises (subsidiaries) that are controlled by the Parent. Control is achieved by the Parent, either directly or indirectly, holding more than 50% of the voting rights or in any other way possibly or actually exercising controlling influence. <br />Basis of consolidationThe consolidated financial statements are prepared on the basis of the financial statements of the Parent and its subsidiaries. The consolidated financial statements are prepared by combining uniform items. On consolidation, intra-group income and expenses, intra-group accounts and dividends as well as profits and losses on transactions between the consolidated enterprises are eliminated. The financial statements used for consolidation have been prepared applying the Group’s accounting policies. Subsidiaries’ financial statement items are recognised in full in the consolidated financial statements. Minority interests’ pro rata shares of the profit/loss and the net assets are disclosed as separate items in Management's proposal for the distribution of net profit/loss and equity, respectively. Investments in subsidiaries are offset at the pro rata share of such subsidiaries’ net assets at the takeover date, with net assets having been calculated at fair value.Foreign currency translationOn initial recognition, foreign currency transactions are translated applying the exchange rate at the transaction date. Receivables, payables and other monetary items denominated in foreign currencies that have not been settled at the balance sheet date are translated using the exchange rate at the balance sheet date. Exchange differences that arise between the rate at the transaction date and the rate in effect at the payment date, or the rate at the balance sheet date, are recognised in the income statement as financial income or financial expenses. Property, plant and equipment, intangible assets and other non-monetary assets that have been purchased in foreign currencies are translated using historical rates. ​ ​When recognising foreign subsidiaries and associates that are independent entities, the income statements ​are translated at average exchange rates for the months that do not significantly deviate from the rates at the transaction date. Balance sheet items are translated using the exchange rates at the balance sheet date. Goodwill ​is considered belonging to the independent foreign entity and is translated using the exchange rate at the balance sheet date. Exchange differences arising out of the translation of foreign subsidiaries’ equity at the beginning of the year at the balance sheet date exchange rates and out of the translation of income statements from average rates to the exchange rates at the balance sheet date are recognised directly in the translation reserve in equity. ​ ​Exchange adjustments of outstanding accounts with independent foreign subsidiaries, which are considered ​part of the total investment in the subsidiary in question, are recognised directly in the translation reserve in equity.When recognising foreign subsidiaries that are integral entities, monetary assets and liabilities are translated using the exchange rates at the balance sheet date. Non-monetary assets and liabilities are translated at the exchange rate at the time of acquisition or the time of any subsequent revaluation or writedown. The items of the ​income statement are translated at the average rates of the months; however, items deriving from non-monetary ​assets and liabilities are translated using the historical rates applicable to the relevant non-monetary items.RevenueRevenue from the sale of services is recognised in the income statement when delivery is made to the buyer. Revenue is recognised net of VAT, duties and sales discounts and is measured at fair value of the consideration fixed.Own work capitalisedOwn work capitalised comprises staff costs and other costs incurred in the financial year and recognised in ​cost for proprietary intangible assets and property, plant and equipment.Other operating incomeOther operating income comprises income of a secondary nature as viewed in relation to the Entity’s primary ​activities.Cost of salesCost of sales comprises goods consumed in the financial year measured at cost, adjusted for ordinary inventory writedowns.Other external expensesOther external expenses include expenses relating to the Entity’s ordinary activities, including expenses for ​premises, stationery and office supplies, marketing costs, etc. This item also includes writedowns of ​receivables recognised in current assets.Staff costsStaff costs comprise wages and salaries, and social security contributions, pension contributions, etc . for entity staff.Depreciation, amortisation and impairment lossesDepreciation, amortisation and impairment losses relating to property, plant and equipment and intangible ​assets comprise depreciation, amortisation and impairment losses for the financial year, and gains and ​losses from the sale of intangible assets and property, plant and equipment.Income from investments in group enterprisesIncome from investments in group enterprises comprises the pro rata share of the individual enterprises’ profit/loss after full elimination of intra-group profits or losses. Other financial incomeOther financial income comprises dividends etc. received on other investments, interest income, including ​interest income on receivables from group enterprises, net capital or exchange gains on securities, payables ​and transactions in foreign currencies, amortisation of financial assets, and tax relief under the Danish ​Tax Prepayment Scheme etc.Other financial expensesOther financial expenses comprise interest expenses, including interest expenses on payables to group ​enterprises, net capital or exchange losses on securities, payables and transactions in foreign currencies, ​amortisation of financial liabilities, and tax surcharge under the Danish Tax Prepayment Scheme etc.Tax on profit/loss for the yearTax for the year, which consists of current tax for the year and changes in deferred tax, is recognised in the ​income statement by the portion attributable to the profit for the year and recognised directly in equity by the portion attributable to entries directly in equity.The Parent is jointly taxed with all of its Danish group enterprises. The current Danish income tax is allocated among the jointly taxed entities proportionally to their taxable income (full allocation with a refund concerning tax losses).Intellectual property rights etc.Intellectual property rights etc. comprise development projects completed and in progress with related intellectual property rights, acquired intellectual property rights and prepayments for intangible assets.Development projects on clearly defined and identifiable products and processes, for which the technical rate ​of utilisation, adequate resources and a potential future market or development opportunity in the enterprise ​can be established, and where the intention is to manufacture, market or apply the product or process in question, are recognised as intangible assets. Other development costs are recognised as costs in the income ​statement as incurred. When recognising development projects as intangible assets, an amount equalling ​the costs incurred less deferred tax is taken to equity under reserve for development costs that is reduced ​as the development projects are amortised and written down. ​​ ​​The cost of development projects comprises costs such as salaries and amortisation that are directly and ​indirectly attributable to the development projects. ​​ ​​ ​Completed development projects are amortised on a straight-line basis using their estimated useful lives ​which are determined based on a specific assessment of each development project. If the useful life cannot ​be estimated reliably, it is fixed at 10 years. For development projects protected by intellectual property rights, the maximum period of amortisation is the remaining duration of the relevant rights. The amortisation periods used are 5 years. ​ ​Intellectual property rights etc. are written down to the lower of recoverable amount and carrying amount.Property, plant and equipmentPlant and machinery as well as other fixtures and fittings, tools and equipment are ​measured at ​cost less accumulated depreciation and impairment losses. Land is not depreciated. ​​ ​​Cost comprises the acquisition price, costs directly attributable to the acquisition and preparation costs of the ​asset until the time when it is ready to be put into operation. For self-constructed assets, cost comprises direct ​and indirect costs of materials, components, subsuppliers and labour costs. For assets held under finance ​leases, cost is the lower of the asset’s fair value and present value of future lease payments. ​ ​ Indirect production costs in the form of indirectly attributable staff costs and amortisation of intangible assets and depreciation on property, plant and equipment used in the manufacturing process are recognised in cost based on time spent on each asset. ​ ​The basis of depreciation is cost less estimated residual value after the end of useful life. Straight-line depreciation is made on the basis of the following estimated useful lives of the assets:Other fixtures and fittings, tools and equipment3-5 years​Estimated useful lives and residual values are reassessed annually. ​ ​Items of property, plant and equipment are written down to the lower of recoverable amount and carrying ​amount.Investments in group enterprisesInvestments in group enterprises are recognised and measured in the parent financial statements according to the equity method. This means that investments are measured at the pro rata share of the enterprises’ equity value. ​ ​Group enterprises with negative equity value are measured at DKK 0. Any receivables from these enterprises ​are written down to net realisable value based on a specific assessment. If the Parent has a legal or constructive obligation to cover the liabilities of the relevant enterprise, and it is probable that such obligation will involve a loss, a provision is recognised that is measured at present value of the costs necessary to settle the obligations at ​the balance sheet date.​ ​Upon distribution of profit or loss, net revaluation of investments in group enterprises is transferred to reserve for net revaluation according to the equity method in equity. ​ Other investmentsOther investments comprise unlisted equity investments measured at the lower of cost and net realisable value.ReceivablesReceivables are measured at amortised cost, usually equalling nominal value, less writedowns for bad and ​doubtful debts.Deferred taxDeferred tax is recognised on all temporary differences between the carrying amount and the tax-based value of assets and liabilities, for which the tax-based value is calculated based on the planned use of each asset. However, no deferred tax is recognised for amortisation of goodwill disallowed for tax purposes and temporary differences arising at the date of acquisition that do not result from a business combination and that do not have any effect on profit or loss or on taxable income. ​Deferred tax assets, including the tax base of tax loss carryforwards, are recognised in the balance sheet at ​their estimated realisable value, either as a set-off against deferred tax liabilities or as net tax assets.Tax payable or receivableCurrent tax payable or receivable is recognised in the balance sheet, stated as tax computed on this year's ​taxable income, adjusted for prepaid tax.PrepaymentsPrepayments comprise incurred costs relating to subsequent financial years. Prepayments are measured at ​cost.CashCash comprises cash in hand and bank deposits.Other provisionsOther provisions comprise anticipated costs of non-recourse guarantee commitments, returns, loss on ​contract work in progress, decided and published restructuring, etc. ​ ​Other provisions are recognised and measured as the best estimate of the expenses required to settle the ​liabilities at the balance sheet date. Provisions that are estimated to mature more than one year after the ​balance sheet date are measured at their discounted value. ​ ​ ​On acquisition of enterprises and investments in group enterprises, provisions are made for costs relating ​to restructuring in the acquired enterprise that were decided and published at the acquisition date at the ​latest. ​ ​Once it is probable that total costs will exceed total income from a contract in progress, provision is made ​for the total loss estimated to result from the relevant contract.Lease liabilitiesLease liabilities relating to assets held under finance leases are recognised in the balance sheet as liabilities other than provisions, and, at the time of inception of the lease, measured at the present value of future lease payments. Subsequent to initial recognition, lease liabilities are measured at amortised cost. The difference between present value and nominal amount of the lease payments is recognised in the income statement as a financial expense over the term of the leases.<br />Operating leasesLease payments on operating leases are recognised on a straight-line basis in the income statement over the term of the lease.Other financial liabilitiesOther financial liabilities are measured at amortised cost, which usually corresponds to nominal value.Deferred incomeDeferred income comprises income received for recognition in subsequent financial years. Deferred income ​is measured at cost.Cash flow statementThe cash flow statement shows cash flows from operating, investing and financing activities, and cash ​and cash equivalents at the beginning and the end of the financial year. ​ ​Cash flows from operating activities are presented using the indirect method and calculated as the operating ​profit/loss adjusted for non-cash operating items, working capital changes and taxes paid. ​ ​Cash flows from investing activities comprise payments in connection with acquisition and divestment of ​ enterprises, activities and fixed asset investments, and purchase, development, improvement and sale, ​etc. of intangible assets and property, plant and equipment, including acquisition of assets held under finance ​leases. ​ ​Cash flows from financing activities comprise changes in the size or composition of the contributed capital ​and related costs, and the raising of loans, inception of finance leases, repayments of interest-bearing ​debt, purchase of treasury shares and payment of dividend. ​ ​Cash and cash equivalents comprise cash. The cash flow statement shows cash flows from operating, investing and financing activities, and cash ​and cash equivalents at the beginning and the end of the financial year. ​ ​Cash flows from operating activities are presented using the indirect method and calculated as the operating ​profit/loss adjusted for non-cash operating items, working capital changes and taxes paid. ​ ​Cash flows from investing activities comprise payments in connection with acquisition and divestment of ​ enterprises, activities and fixed asset investments, and purchase, development, improvement and sale, ​etc. of intangible assets and property, plant and equipment, including acquisition of assets held under finance ​leases. ​ ​Cash flows from financing activities comprise changes in the size or composition of the contributed capital ​and related costs, and the raising of loans, inception of finance leases, repayments of interest-bearing ​debt, purchase of treasury shares and payment of dividend. ​ ​Cash and cash equivalents comprise cash. 2022-07-04Henrik Mou