BDO Statsautoriseret revisionsaktieselskabKolding Åpark 8A, 7. salDK-6000 Kolding20222670Årsrapport2022-03-14Kim Doctor KrintelSOURCE TECHNOLOGY ApSKorsvej 116000 KoldingRevisionspåtegning298453362006-08-31Kolding2021-01-012021-12-312020-01-012020-12-31BDO Statsautoriseret revisionsaktieselskabKolding Åpark8A, 7. sal6000KoldingSydbankKolding Åpark8B6000KoldingBech BruunLangelinie Allé352100Copenhagen ØKolding2022-03-02Kim Doctor KrintelJeffrey Dean WengerChairmanMitchell Scott AllenMegan HillKonklusionGrundlag for konklusionKolding2022-03-02BDO Statsautoriseret revisionsaktieselskab20222670Henning WieseRevisionspåtegningState Authorised Public Accountantmne277074209265242875000196423952008100038161143554000022900018634143190110002481661920003537187140001852859118489000407551940530001445307214436000130000012500001250000011903072131860002871541357000013437601469000328804740004248181551300028714907288370007822762760600003710003653766936814000144410522100001444105221000042229955445370004052112910003621048761800086065904863000126328491277200065777131809000549741313000102423018153511839000289882686000662834155000999794448020004915595981700069776343719280001000000100000022654483155000449230493213000013000001250000494884973753500024545152501000245451525010006895359735600068953598723000043000475376473000238563214961000405180312020004025161649000010937972231690001783333131892000697763437192800010000003154722321307031250000119030722550000-1250000-1250000-8892748892741000000226544844923049130000022221733936117222000160044422670007466675000627924517000196423952008100041221182824000-465991229000407551940530001059054318455584743956014680-69318646050190215251671112380612035773328807020422376733013460983152800836652069201302871541134376032880323026381034819137070101587551-1515164739510749860114446309528520330421481173275003466244274190201256538609971293739432724139099882871490778227620221002918000783924144410514441055256299Regnskabsklasse BtruetrueToday the Board of Directors and Executive Board have discussed and approved the Annual Report of SOURCE TECHNOLOGY ApS for the financial year 1 January - 31 December 2021. The Annual Report is presented in accordance with the Danish Financial Statements Act. In our opinion the Financial Statements give a true and fair view of the Company's assets, liabilities and financial position at 31 December 2021 and of the results of the Company's operations for the financial year 1 January - 31 December 2021. The Management Commentary includes in our opinion a fair presentation of the matters dealt with in the Commentary. We recommend the Annual Report be approved at the Annual General Meeting. To the Shareholders of SOURCE TECHNOLOGY ApS We have audited the Financial Statements of SOURCE TECHNOLOGY ApS for the financial year 1 January - 31 December 2021, which comprise income statement, Balance Sheet, statement of changes in equity, notes and a summary of significant accounting policies. The Financial Statements are prepared in accordance with the Danish Financial Statements Act. In our opinion, the Financial Statements give a true and fair view of the assets, liabilities and financial position of the Company at 31 December 2021 and of the results of the Company's operations for the financial year 1 January - 31 December 2021 in accordance with the Danish Financial Statements Act. Basis for Opinion Grundlag for konklusion We conducted our audit in accordance with International Standards on Auditing (ISAs) and the 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 Financial Statements” section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), together with the ethical requirements that are relevant to our audit of the financial statements in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion. Matters concerning the audit With effect from the current financial year, the Company has changed from extended review to audit. Management's Responsibilities for the Financial Statements Management is responsible for the preparation of 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 Financial Statements that are free from material misstatement, whether due to fraud or error. In preparing the Financial Statements, Management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the Financial Statements unless Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. 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 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 Financial Statements. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the 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. 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 Company's internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the 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 Company'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 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 Company to cease to continue as a going concern. Evaluate the overall presentation, structure and contents of the Financial Statements, including the disclosures, and whether the Financial Statements represent the underlying transactions and events in a manner that gives a true and fair view. 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. Statement on Management Commentary Management is responsible for Management Commentary. Our opinion on the Financial Statements does not cover Management Commentary, and we do not express any form of assurance conclusion thereon. In connection with our audit of the Financial Statements, our responsibility is to read Management Commentary and, in doing so, consider whether Management Commentary is materially inconsistent with the Financial Statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether Management Commentary provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that Management Commentary is in accordance with the 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 Management Commentary. Principal activities The company's activity comprises to conduct business with consulting as well as development and sale of machines and products primarily for the food industry. Development in activities and financial and economic position The income statement of the entity for 2021 shows a profit of DKK ('000) 14,453. Management considers the result for the year satisfactory. Significant events after the end of the financial year No events have occurred after the end of the financial year of material importance for the company's financial position. Share capital Reserve for development costs Retained earnings Proposed dividend Total Equity at 1 January 2021 1.000.000 3.154.722 32.130.703 1.250.000 37.535.425 Proposed profit allocation 11.903.072 2.550.000 14.453.072 Transactions with owners Dividend paid -1.250.000 -1.250.000 Extraordinary dividend paid -1.250.000 -1.250.000 Other legal bindings Capitalized development costs -889.274 889.274 0 Equity at 31 December 2021 1.000.000 2.265.448 44.923.049 1.300.000 49.488.497 2021 2020 DKK DKK '000 Staff costs 1 Average number of employees 22 22 Wages and salaries 17.339.361 17.222 Pensions 1.600.444 2.267 Social security costs 74.666 75 Other staff costs 627.924 517 19.642.395 20.081 Tax on profit/loss for the year 2 Calculated tax on taxable income of the year 4.122.118 2.824 Adjustment of deferred tax -46.599 1.229 4.075.519 4.053 Intangible assets 3 Development projects completed Intangible fixed assets acquired Development projects in progress and prepayments Cost at 1 January 2021 10.590.543 1.845.558 474.395 Transferred 601.468 0 -693.186 Additions 46.050 190.215 251.671 Cost at 31 December 2021 11.238.061 2.035.773 32.880 Amortisation at 1 January 2021 7.020.422 376.733 0 Amortisation for the year 1.346.098 315.280 0 Amortisation at 31 December 2021 8.366.520 692.013 0 Carrying amount at 31 December 2021 2.871.541 1.343.760 32.880 Development projects The capitalized development cost all comprises unique technologies for production of pet food- and human food products, and analysis for the same. There is expected to continue to be a big market for the products, that is strongly driven by strategic signalling effects like food control, healthier products etc. Property, plant and equipment 4 Land and buildings Other plant, fixtures and equipment Tangible fixed assets in progress and prepayment Cost at 1 January 2021 32.302.638 10.348.191 370.701 Transferred 0 1.587.551 -1.515.164 Additions 739.510 749.860 1.144.463 Disposals 0 -952.852 0 Cost at 31 December 2021 33.042.148 11.732.750 0 Depreciation and impairment losses at 1 January 2021 3.466.244 2.741.902 Reversal of depreciation of assets disposed of 0 -125.653 Depreciation for the year 860.997 1.293.739 Depreciation and impairment losses at 31 December 2021 4.327.241 3.909.988 Carrying amount at 31 December 2021 28.714.907 7.822.762 0 Financial non-current assets 5 Other receivables Cost at 1 January 2021 2.210.029 Additions 18.000 Disposals -783.924 Cost at 31 December 2021 1.444.105 Carrying amount at 31 December 2021 1.444.105 Long-term liabilities 6 31/12 2021 Repayment Debt outstanding 31/12 2020 total liabilities next year after 5 years total liabilities Mortgage debt 7.370.735 475.376 5.256.299 7.827.457 531.100 531.100.01 Lease liabilities 0 0 0 42.755 533.200 533.200.01 Holiday allowance commitment 0 0 0 1.367.014 535.900 535.900.01 7.370.735 475.376 5.256.299 9.237.226 Contingent liabilities The company has warranties for delivered goods and services. Operating leases The company has entered into operating lease agreements which have not been recognised in the financial statement. The liability is DKK ('000) 300 at 31 December 2021. The agreement have an average residual term of 3 to 12 month. Rent obligations The company has entered into an agreement to rent with term of notice on 3 months. Charges and securities 8 The buildings have been charged as security for mortgage debt. The carrying amount of the assets is DKK (’000) 28,715 at 31 December 2021. A letter of indemnity worth DKK ('000) 5,000 has been issued towards a financial institute to secure bank debt. The letter of indemnity is secured by way of pledge in goodwill, instangible property rights, other plant, fixtures and equipment, inventories and trade receivables (company pledge). The carrying amount of pledged assets is DKK ('000) 30,946. The Annual Report of SOURCE TECHNOLOGY ApS for 2021 has been presented in accordance with the provisions of the Danish Financial Statements Act for enterprises in reporting class B and certain provisions applying to reporting class C. Regnskabsklasse B1 true true The Annual Report is prepared consistently with the accounting principles applied last year. Net revenue Net revenue from sale of manufactured goods and goods for resale is recognised in the income statement if supply and risk transfer to purchaser has taken place before the end of the year and if the income can be measured reliably and is expected to be received. Net revenue is recognised exclusive of VAT, duties and less discounts related to the sale. Net revenue is recognised exclusive of VAT and less duties and discounts related to the sale. Other operating expenses Other operating expenses include items of a secondary nature in relation to the enterprises' principal activities, including loss from sale of intangible and tangible fixed assets. Cost of sales Cost of sales comprise costs incurred to achieve the net revenue for the year, including direct and indirect costs of raw materials and consumables. Other external expenses Other external expenses include cost of sales, advertising, administration, buildings, bad debts, operating lease expenses, etc. Payments related to operating lease expenses and other lease agreements are recognised in the Income Statement during the continuance of the contract. The Company’s total liability concerning operating and other lease agreements are stated under contingencies, etc. Staff costs Staff costs comprise wages and salaries, including holiday pay and pensions and other costs for social security etc. for the company’s employees. Repayments from public authorities are deducted from staff costs. Financial income and expenses Financial income and expenses include interest income and expenses, financial expenses of finance leases, realised and unrealised gains and losses arising from investments in financial assets, debt and transactions in foreign currencies, amortisation of financial assets and liabilities as well as charges and allowances under the tax-on-account scheme etc. Financial income and expenses are recognised in the income statement by the amounts that relate to the financial year. Tax The tax for the year, which consists of the current tax for the year and changes in deferred tax, is recognised in the income statement by the portion that may be attributed to the profit for the year, and is recognised directly in the equity by the portion that may be attributed to entries directly to the equity. Intangible fixed assets Patents and licences are measured at the lower of cost less accumulated amortisation or the recoverable amount. Patents are amortised over the residual patent term and licences are amortised over the term of the agreement, however, no more than 20 years. Development costs comprise costs, including wages and salaries, and amortisation, which directly or indirectly can be related to the company’s development activities and which fulfil the criteria for recognition. Capitalised development costs are measured at the lower of cost less accumulated amortisation or recoverable amount. Capitalised development costs are amortised on a straight-line basis over the estimated useful life after completion of the development work. The amortisation period is normally 3-5 years. Intangible fixed assets are generally written down to the lower of recoverable value and carrying amount. Profit or loss from sale of intangible fixed assets is calculated at the difference between the sales price and the carrying amount at the time of the sale. Profit and loss are recognised in the Income Statement under other operating income or other operating expenses. Tangible fixed assets Land and buildings, other plant, fixtures and equipment are measured at cost less accumulated depreciation and impairment losses. Land is not depreciated. The depreciation base is cost less estimated residual value after end of useful life. The cost includes the acquisition price and costs incurred directly in connection with the acquisition until the time when the asset is ready to be used. As regards self-manufactured assets, the cost price includes cost of materials, components, subcontractors, direct payroll and indirect production costs. Straight-line depreciation is provided on the basis of an assessment of the expected useful lives of the assets and their residual value: Useful lifeResidual value Buildings 26-30 years 0-19 % Other plant, fixtures and equipment 3-7 years 0-70 % Profit or loss on disposal of tangible fixed assets is stated as the difference between the sales price less selling costs and the carrying amount at the time of sale. Profit or loss is recognised in the income statement as other operating income or other operating expenses. Lease contracts Lease contracts relating to tangible fixed assets for which the Company bears all material risks and benefits attached to the ownership (finance lease, see IAS 17) are recognised as assets in the Balance Sheet. The assets are at the initial recognition measured at the lower of cost stated at fair value and the and present value of the future lease payments. The internal interest rate of the lease contract, or alternatively the Company’s loan interest, is used as discounting factor when calculating the present value. Finance lease assets are hereafter treated as the Group’s and the Company’s other similar tangible fixed assets. The capitalised residual lease liability is recognised in the balance sheet as a liability and the interest portion of the lease payment is recognised in the income statement over the term of the contract. Fixed asset investments Other receivables are recognised and measured at amortised cost. Impairment of fixed assets The carrying amount of intangible fixed and tangible assets together with fixed assets, which are not measured at fair value, are valued on an annual basis for indications of impairment other than that reflected by amortisation and depreciation. In the event of impairment indications, an impairment test is made for each asset or group of assets, respectively. If the recoverable amount is lower than the carrying amount, the asset is written down to the carrying amount. The recoverable amount is calculated at the higher of net selling price and capital value. The capital value is determined as the fair value of the expected net cash flows from the use of the asset or group of assets and the expected net cash flows from sale of the asset or group of assets after the end of its useful life. Inventories Inventories are measured at cost using the FIFO-principle. If the net realisable value is lower than cost, the inventories are written down to the lower value. Cost consist of purchase price plus delivery costs. Cost of manufactured goods and work in progress consists of costs of raw materials and consumables and direct payroll cost. The net realisable value of inventories is stated at sales price less completion costs and costs incurred to execute the sale and is determined with due regard to marketability, obsolescence and development in expected sales price. Receivables Receivables are measured at amortised cost which usually corresponds to nominal value. The value is written down to meet expected losses. Accruals, assets Accruals recognised as assets include costs incurred relating to the subsequent financial year. Tax payable and deferred tax Current tax liabilities and receivable current tax are recognised in the balance sheet as the calculated tax on the taxable income for the year, adjusted for tax on the taxable income for previous years and taxes paid on account. Deferred tax is measured on the temporary differences between the carrying amount and the tax value of assets and liabilities. Deferred tax assets, including the tax value of tax loss carry-forwards, are measured at the expected realisable value of the asset, either by set-off against tax on future earnings or by set-off against deferred tax liabilities within the same legal tax entity. Deferred tax is measured on the basis of the tax rules and tax rates that under the legislation in force on the balance sheet date will be applicable when the deferred tax is expected to crystallise as current tax. Any changes in the deferred tax resulting from changes in tax rates, are recognised in the income statement, except from items recognised directly in equity. Liabilities Financial liabilities are recognised at the time of borrowing by the amount of proceeds received less borrowing costs. In subsequent periods, the financial liabilities are measured at amortised cost equal to the capitalised value when using the effective interest, the difference between the proceeds and the nominal value being recognised in the Income Statement over the term of loan. Amortised cost for short-term liabilities usually corresponds to the nominal value. Prepayments received from customers comprise amounts received from customers prior to delivery of the goods agreed or completion of the service agreed. Foreign currency translation Transactions in foreign currencies are translated at the rate of exchange on the transaction date. Exchange differences arising between the rate on the transaction date and the rate on the payment date are recognised in the income statement as a financial income or expense. Receivables, payables and other monetary items in foreign currencies that are not settled on the balance sheet date are translated at the exchange rate on the balance sheet date. The difference between the exchange rate on the balance sheet date and the exchange rate at the time of occurrence of the receivables or payables is recognised in the income statement as financial income or expenses. 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