2. Summary of Significant Accounting Policies (continued)

b)   Basis of consolidation (continued)

The group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The group recognises any non-controlling interest in the acquired companies on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest's proportionate share of the recognised amounts of acquiree's identifiable net assets.

Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated. When necessary, amounts reported by subsidiaries have been adjusted to conform with the group's accounting policies.

c)   Going Concern

The preparation of financial statements requires an assessment on the validity of the going concern assumption.

The Directors have reviewed projections for a period of at least 12 months from the date of approval of the Financial Statements.

The Directors have assessed the Covid‐19 impact on its ability to continue as a going concern. They consider that the events arising from the Covid‐19 outbreak do not impact on its use of the going concern basis of preparation nor do they cast significant doubt over the company's ability to continue as a going concern for the period of at least twelve months from the date when the financial statements are authorised for issue.

In making their assessment of going concern, the Directors acknowledge that the Group has a very small cost base, and development of its existing projects have been pre-funded. The group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group has sufficient funds following events after the year end. Since the year end, Dukemount raised £1million in equity funding, and also entered into other financial arrangements allowing the Group to draw up to £3.5million towards its gas peaking projects. The funds are raised are sufficient to ensure that the Parent and Group have the ability to pay their third party debts as they fall due.

The directors note that the Group has always been successful with past fundraises and continue to believe strongly in the Group's projects. Accordingly, the Board believes it is appropriate to adopt the going concern basis in the preparation of the Financial Statements.

d)  Changes in accounting policies and disclosure

In issue and effective for periods commencing on 1 May 2020

The Company has applied the following standard and amendments for the first time for its annual reporting period commencing 1 May 2020

•      Definition of Material - Amendments to IAS 1 and IAS 8;

•      Definition of a Business - Amendments to IFRS 3;

•      Interest Rate Benchmark Reform - Amendments to IFRS 9, IAS 39 and IFRS 7;

•      Revised Conceptual Framework for Financial Reporting;

•      Annual improvements to IFRS Standards 2018-2020 Cycle; and

•      COVID-19 related rent concessions - Amendments to IFRS.

The adoption of these standards and amendments have not had a material impact on the Group or Company in the year.

In issue but not effective for periods commencing on 1 May 2020

A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 April 2021 and have not been applied in preparing these financial statements. None of these are expected to have a significant effect on the financial statements of the company, except the following set out below:

There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Group or Company

e)   Segmental reporting

Identifying and assessing investment projects is the only activity the Group is involved in and is therefore considered as the only operating/reportable segment. As the subsidiaries grow and acquire additional properties and projects, management will then consider them as separate reportable segments.

Therefore the financial information of the single segment is the same as that set out in the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity and the Statement of Cashflows.

f)   Revenue from contracts with customers

Revenue relates to amounts contractually due under a property development agreement at the balance sheet date relating to the stage of completion of a contract as measured by surveys of work performed to date. Revenue is recognised for services when the Group has satisfied its contractual performance obligation in respect of the services.  The amount recognised for the services performed is the consideration that the Group is entitled to for performing the services provided. Revenue from contracts with customers is recognised over time.

Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change, and may include cost contingencies to take into account specific risks within each contract. Cost contingencies are reviewed on a regular basis throughout the life of the contract. However, the nature of the risks on projects are such that they often cannot be resolved until the end of the project and therefore may reverse until the end of the project. Any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management. The estimated final outcomes on projects are continuously reviewed, and adjustments are made when necessary. Provision is made for all known or expected losses on individual contracts once such losses are foreseen.

Where costs incurred plus recognised profits less recognised losses exceed progress billings, the balance is recognised as contract assets within trade and other receivables. Where progress billings exceed costs incurred plus recognised profits less recognised losses, the balance is recognised as contract liabilities within trade and other payables.

2. Summary of Significant Accounting Policies (continued)

g)  Cash and Cash Equivalents

Cash and cash equivalents comprise cash in hand and current and deposit balances with banks similar. This definition is also used for the Statement of Cash Flows.

The Group considers the credit ratings of banks in which it holds funds in order to reduce exposure to credit risk.

The Group considers that it is not exposed to major concentrations of credit risk.

h)  Financial Instruments

Financial assets

The Group and Company classifies its financial assets in the following measurement categories:

•     Those to be measured subsequently at fair value through profit or loss; and

•     Those to be measured at amortised cost.

The classification depends on the business model for managing the financial assets and the contractual terms of the cash flows. Financial assets are classified as at amortised cost only if both of the following criteria are met:

•     The asset is held within a business model whose objective is to collect contractual cash flows; and

•     The contractual terms give rise to cash flows that are solely payments of principal and interest.

Financial assets at amortised cost are subsequently measured using the effective interest rate (EIR) method and are subject to impairment. The Group's and Company's financial assets at amortised cost include trade and other receivables, contract assets and cash and cash equivalents. A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised when:

•     The rights to receive cash flows from the asset have expired; or

•     The Group and Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement; and either (a) the Group and Company has transferred substantially all the risks and rewards of the asset, or (b) the Group and Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

The Group currently does not recognise an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss, as the effect would be immaterial on these financial statements. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original EIR. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

For trade receivables (not subject to provisional pricing) and other receivables due in less than 12 months, the Group applies the simplified approach in calculating ECLs, as permitted by IFRS 9. Therefore, the Group does not track changes in credit risk, but instead, recognises a loss allowance based on the financial asset's lifetime ECL at each reporting date. The Group assesses a non-performing debt based on the payment terms of the receivable.

2. Summary of Significant Accounting Policies (continued)

i) Financial Instruments (continued)

i)    Financial liabilities

Financial liabilities, comprising trade and other payables, are held at amortised cost.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Trade and other payables are recognised initially at fair value, and subsequently measured at amortised cost using the effective interest method.

j)    De-recognition of Financial Instruments

i.    Financial Assets

A financial asset is derecognised where:

·     the right to receive cash flows from the asset has expired;

·     the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a pass-through arrangement; or

·     the Group has transferred the rights to receive cash flows from the asset, and either has transferred substantially all the risks and rewards of the asset or has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

ii.   Financial Liabilities

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the statement of comprehensive income.

2. Summary of Significant Accounting Policies (continued)

k)   Taxation

Current tax

Current tax is based on the taxable profit or loss for the year. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or recognised in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

Current tax is calculated at the tax rates (and laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax

Deferred tax is recognised using the liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the Financial Statements and the corresponding tax bases used in the computation of taxable profit. However, deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction that at the time of the transaction affects neither accounting nor taxable profit or loss. In principle, deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to income taxes

levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Deferred tax is calculated at the tax rates (and laws) that have been enacted or substantively enacted at the Statement of Financial Position date and are expected to apply to the period when the deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax assets and liabilities are not discounted.

l)    Equity

Equity comprises the following:

·     Share capital representing the nominal value of the equity shares;

·     Share premium representing consideration less nominal value of issued shares and costs directly attributable to the issue of new shares;

·     Share based payments reserve representing the fair value of share based payments valued in accordance with IFRS 2.

2. Summary of Significant Accounting Policies (continued)

m)  Share Capital

Ordinary shares are classified as equity.

n)  Share Based Payments

The Group has issued warrants over the ordinary share capital as described in note 15. In accordance with IFRS 2, the total amount to be expensed over the vesting period for warrants issued for services is determined by reference to the fair value of the warrants granted, excluding non‑market vesting conditions. Non‑market vesting conditions are included in assumptions about the number of warrants that are expected to vest.

For warrants issued relating to the raising of finance, the relevant expense is offset against the share premium account.  The total amount to be expensed is determined by reference to the fair rate of the warrants granted, excluding non‑market vesting conditions.  Non‑market vesting conditions are included in assumptions about the number of warrants that are expected to vest.

o)  Investments

Equity investments in subsidiaries are held at cost, less any provision for impairment.

p)  Financial Risk Management

Financial Risk Factors

The Group's activities expose it to a variety of financial risks: market risk (price risk), credit risk and liquidity risk. The Group's overall risk management programme seeks to minimise potential adverse effects on the Group's financial performance. None of these risks are hedged.

The Group has no foreign currency transactions or borrowings, so is not exposed to market risk in terms of foreign exchange risk.  The Group will require funding to acquire and develop and/or refurbish its properties and accordingly will be subject to interest rate risk.

Risk management is undertaken by the Board of Directors.

Market Risk - price risk

The Group was exposed to equity securities price risk because of investments held by the Group, classified as available-for-sale financial assets. These assets were sold in the year, and therefore the carrying value at the year end is £Nil, which represents the maximum exposure for the Group.

The Group is not exposed to commodity price risk. The Directors will revisit the appropriateness of this policy should the Group's operations change in size or nature.

Credit risk

Credit risk arises from cash and cash equivalents as well as any outstanding receivables. Management does not expect any losses from non-performance of these receivables. The amount of exposure to any individual counter party is subject to a limit, which is assessed by the Board.

The Group considers the credit ratings of banks in which it holds funds in order to reduce exposure to credit risk, which is stated under the cash and cash equivalents accounting policy.

2. Summary of Significant Accounting Policies (continued)

Liquidity risk

Liquidity risk arises from the Group's management of working capital. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. The proceeds raised from the placing are being held as cash to enable the Group to fund a transaction as and when a suitable target is found.

Controls over expenditure are carefully managed, in order to maintain its cash reserves whilst it targets a suitable transaction.

Financial liabilities are all due within one year.

Capital risk management

The Group's objectives when managing capital is to safeguard the Group's ability to continue as a going concern, in order to provide returns for shareholders and benefits for other stakeholders, and to maintain an optimal capital structure. The Group has no borrowings.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares.

The Group monitors capital on the basis of the total equity held by the Group, being a net asset of £90,918 as at 30 April 2020 (2019: net asset £187,160).

q)  Critical Accounting Estimates and Judgements

The Directors make estimates and assumptions concerning the future as required by the preparation of the financial statements in conformity with EU endorsed IFRSs. The resulting accounting estimates will, by definition, seldom equal the related actual results.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

i.    Share based payments

In accordance with IFRS 2 'Share Based Payments' the Group has recognised the fair value of warrants calculated using the Black-Scholes option pricing model. The Directors have made significant assumptions particularly regarding the volatility of the share price at the grant date in order to calculate a total fair value. Further information is disclosed in Note 15.

ii) Percentage completion method used for long term contracts

The Group makes an estimate of the stage of completion of a development project based on the costs incurred at the year end. Management then make assumptions regarding the collectability of billings and expected future costs. The method used is as stated in the constructions contract accounting policy 2f). Estimation uncertainty will exist with regard to the gross profit being recognised at the year end. The Directors believe that this uncertainty is reduced to an acceptable level by using quantity surveyors' reports to assess the stage of contract completion at the year end.

iii) Intercompany balances

Subsequent to the year end, the Company has also commenced a group reorganisation process of novating and capitalising intercompany debts and whilst this process is ongoing they have concluded that no impairment is required at 30 April 2021.

3.   Revenue

All revenue is recognised over time.

4.    Expenses by Nature

5. Directors' Remuneration                                                      

Other benefits of £10,303 (2020: £nil) were also paid to the directors.

Details of directors' remuneration are included in the Directors' Remuneration Report.

The average number of employees (including directors) during the year was 2 (2020: 2).

6. Services provided by the Company's Auditors

During the year, the Group obtained the following services from the Group's auditors and its associates:

7.   Taxation

Tax Charge for the Year

No taxation arises on the result for the year due to taxable losses.

Factors Affecting the Tax Charge for the Period

The tax credit for the period does not equate to the loss for the period at the applicable rate of UK Corporation Tax of 19.00% (2020: 19.00%).  The differences are explained below:

Factors Affecting the Tax Charge of Future Periods

Tax losses available to be carried forward by the Group at 30 April 2020 against future profits are estimated at £2,154,827 (2020 - £1,241,000).

A deferred tax asset has not been recognised in respect of these losses in view of uncertainty as to the level of future taxable profits.

There is no expiry date on carried forward tax losses.

8. Investment in subsidiaries

Details of Subsidiaries

Details of the subsidiaries at 30 April 2021 are as follows:

The registered office of all subsidiary undertakings is the same as the parent company.

9.   Trade and Other Receivables

The fair value of all receivables is the same as their carrying values stated above.

The maximum exposure to credit risk at the reporting date is the carrying value mentioned above. The Group does not hold any collateral as security.

Amounts recoverable on contracts represents sales invoices issued after 30 April 2021 in respect of work undertaken during the year ended 30 April 2021 with appropriate provision being made in accruals and deferred income for costs incurred in undertaking such work but which had not been invoiced at 30 April 2021.

Amounts due from group undertakings are unsecured, interest free, have no fixed date of repayment and repayable on demand. Advances were made to the subsidiaries in order to fund the redevelopment project.

10. Dividends

No dividend has been declared or paid by the Company during the year ended 30 April 2021 (2020: Nil).

11. Earnings per share

Basic earnings per share is calculated by dividing the loss attributable to equity holders of the Group by the weighted average number of ordinary shares in issue during the year. In accordance with IAS 33, basic and diluted earnings per share are identical as the effect of the exercise of the warrants would be to decrease the loss per share.

                                                                                                                                            2021          2020

                                                                                                                                                £                £

      Loss attributable to equity holders of the Group                                                   913,827      331,646

                                                                                                                                    ______       ______

      Total                                                                                                                     913,827      331,646

                                                                                                                                    ______       ______

      Weighted average number of ordinary shares in issue (thousands)                      456,930      366,766

                                                                                                                                    ______         _____

Basic and diluted profit per share                                                                               2021             2020

                                                                                                                                                £                £

Continuing Operations - basic and diluted                                                                      0.0020     0.00090

12. Share Capital

Group and Company

13. Share Premium

Group and Company                                                                 

14. Share Based Payments

Details of the warrants outstanding at 30 April 2021 are included below. The fair value of the warrants was determined using the Black Scholes valuation model. The parameters used are detailed below:

The expected volatility for the warrants granted is based on the historical share price volatility of similar listed entities from their date of admission to the market up to the completion of the first six months of trading. This is considered to be the most reasonable measure of expected volatility, given the relatively brief trading history of the Group.

The warrants issued in 2017 have been modified in the year, with their expiry date being extended until 29 March 2023. The fair value adjustment as required under IFRS 2 as a result of this modification was immaterial and as such no change in the fair value has been reflected in the Financial Statements.

The risk free rate of return is based on zero yield government bonds for a term consistent with the warrant life. A reconciliation of warrants in issue over the period to 30 April 2021 is shown below:

The weighted average contracted and expected life (years) for the above warrants is 1 year (2020 - 1 year).

15. Trade and Other Payables                                                                                        

Accrued property costs represents the cost of property work undertaken as at 30 April 2021.

16. Treasury Policy and Financial Instruments

The Group operates an informal treasury policy which includes the ongoing assessments of interest rate management and borrowing policy.  The Board approves all decisions on treasury policy.

The Group has financed its activities by the raising of funds through the placing of shares. 

There are no material differences between the book value and fair value of the financial instruments.

17. Capital Commitments

There were no capital commitments authorised by the Directors or contracted for at 30 April 2021.

18. Related Party Transactions

The Directors are Key Management and information in respect of key management is given in Note 5.

At 30 April 2021, the Company was due from DKE (Wavertree), a wholly owned subsidiary of the Group, £103,065 (2020: due to £31,135)

At 30 April 2021, the Company was due from DKE (Northwest), a wholly owned subsidiary of the Group, £15,763 (2020: due to £224,049).

19. Ultimate Controlling Party

The Directors believe there to be no ultimate controlling party.

20. Events after the reporting period

On 4 May 2021, the Company announced it had  entered into a 12-month convertible unsecured loan facility for £1,000,000 ("Facility") with a consortium arranged by Sanderson Capital Partners Limited the ("Lenders"), of which £500,000 is available immediately and the additional £500,000 available conditional on certain milestones being met by the Company.

On 15 June 2021 the Company issued 13,286,713 ordinary shares to the consortium arranged by Sanderson Capital Partners Limited as payment under the Facility Agreement in relation to fees. The availability fee of £70,000, £10,000 drawdown fees and reimbursement of legal fees were converted into ordinary shares at 0.715p.

In addition to the above arrangement, 3,846,153 ordinary shares have been issued to Miriad Limited under an agreement for the provision of Investor Relations services for an initial 12 months, which equates to £25,000 at 0.65p.

On 20 May the Company announcemed that it has entered into a Joint Venture Agreement in relation to flexibility power expert HSKB Ltd ("HSKB"), of which Dukemount non-executive director Paul Gazzard is a founder. Pursuant to the Joint Venture Agreement, Dukemount will acquire 50% of the issued share capital of HSKB for nominal value.

Dukemount   successfully signed off a subordinated funding package necessary to enable completion of the senior debt funding for the gas peaking projects in September 2021 and announced in October 2021   that HSKB Limited ("HSKB"), in which Dukemount  holds a 50% interest, that it has successfully completed the purchase of two special purpose companies. Each company contains an 11kV gas peaking facility, which are ready to build, with full planning permission and grid access. HSKB has also changed its name to DKE Flexible Energy Limited ("DKE Energy").  DKE Energy will initially build two gas peaking facilities. Dukemount will manage the construction of the two sites and provide its knowledge of long-dated income funding and finance to optimize the capital structure. DKE Energy's management brings its technical, operational and market expertise of the UK flexible power market, as well as access to a pipeline of further deals. Dukemount believes the opportunities presented by this joint venture to be an important milestone for Dukemount to meet its projected growth targets. Dukemount is set to rollout further joint venture projects with a focus on gas peaking and battery storage facilities. Both asset types balance the fluctuating power requirements of the grid during periods of high-level demand or shortfalls of electricity supply: a problem which is set to become more acute in the transition to a greater reliance on renewable energy sources

Further to its announcement of 15 September 2021 regarding the signing of the subordinated funding package necessary to enable completion of the senior debt funding for the gas peaking projects, Dukemount issued 15,119,442 ordinary shares ("New Shares") at a subscription price of 0.3077 pence per ordinary share (being 93% of the lowest daily VWAP of the last 10 Trading Days (being VWAP of 0.3308 pence reported on 13 September 2021) in settlement of the implementation fees arising under such funding package.

Subsequent to the year end, the Company has also commenced a group reorganisation process of novating and capitalising intercompany debts and whilst this process is ongoing they have concluded that no impairment is required at 30 April 2021.