Ross Group Plc & Subsidiaries

Annual Report and Financial Statements

For the year ended 31 December 2021

Ross Group Plc & Subsidiaries

Consolidated Financial Statements

Contents

Page

Company Information 1

Summary and

Highlights

Chairman’s

Statement

Group Strategic Report 6

Report of the Directors 12

Corporate Governance Statement 15

Directors’ Remuneration Report 18

Corporate Social Responsibility 19

Report of the Independent Auditors 20

Consolidated Income

Statement

Company Income Statement 29

Consolidated Statement of Comprehensive Income 30

Company Statement of Comprehensive Income 31

Consolidated Statement of Financial Position 32

Company Statement of Financial Position 33

Consolidated Statement of Changes in Equity 34

Company Statement of Changes in Equity 35

Consolidated Statement of Cash Flows 36

Company Statement of Cash Flows 37

Notes to the Statement of Cash Flows 38

Notes to the Consolidated Financial Statements 39

Ross Group Plc & Subsidiaries

Company Information

For the year ended 31 December 2021

Directors: B R Pettitt

S C Mehta BSc (Hons)

R E Tamraz

P M Fisher

M J L D’Hombres

Secretary: S C Mehta BSc (Hons)

Registered Office: 71-75 Shelton Street

Covent Garden

London

WC2H 9JQ

Registered Number: 00131902 (England and Wales)

Auditors: CBW Audit Limited

Chartered Accountants

& Statutory Auditors

66 Prescot Street

London

E1 8NN

Ross Group Plc & Subsidiaries

Summary and Highlights

For the year ended 31 December 2021

As we have previously reported in our interim accounts, during the first half of 2021, Ross Group Plc

(“RGP”) has been having to go through the process of restructuring its acquisition of the four start-up

businesses that were completed in 2019 and which are wholly-owned subsidiaries within Archipelago

Aquaculture Group (AAG) and had amongst other things been primarily subjected to the Worldwide

consequential effects of the COVID Pandemic.

This is therefore the first full year RGP Annual Report that includes and consolidates the AAG’s results,

particularly given the above COVID circumstances.

As a result, there is a fundamental difference in the 2021 results in comparison to its previous year.

RGP has, for many years now, been operating based on a specialist professional supply chain

management model and continues to do so to date. However, the AAG acquisition subsequently caused

that model to have to be modified; in order to include and integrate other more specialist supply chain

services and functions, particularly with regard to the requisite research and development (“R&D”) in

order to try to provide proof of pioneering production concepts and then thereafter transition at a

considered viable point in the future into mass production and sales of product and/or global turn-key

projects of hopefully high quality pharmaceutical grade Chitin.

For our fiscal year 2021, no services or sales of Chitin were able to be recorded - as all of the R&D and

implementation of pioneering production processes were more than hampered by both restricted and/or

reduced funding from the seller of the AAG businesses, in combination with the commercial effects of

COVID causing the operations to have to be indefinitely suspended whilst a review and remedial

restructuring took place; resulting in the renewed and continued Chitin focus through a new venture,

namely, RGP-525.

Production and administration costs have been subsequently subjected to specific strategic

reorganisation, which has resulted in the further impairment and/or reduction of certain contingent,

capitalized and considerable pre-existing liabilities that the AAG companies were incurring both in

advance of any production and with all the logistical labour constraints of COVID. The relocation and

centralization of the venture allows for a much more manageable and efficient operation and overhead

structure once a post-Covid norm can be established.

Your Board of Directors had initially always anticipated and estimated that it would take a considerable

amount of time and funding in order to get this new technology into mass production and had initially

provisioned for it accordingly. However, the commercial confluence of COVID and the consequential

cashflow constraints, caused by the lack of the pre-agreed financing from the seller of the AAG business

were both exceptionally unique and unpredictable.

Our new venture, RGP-525, with the founder of 525 Solutions, Professor Robin Rogers, who had

previously sub-licensed their proprietary ionic liquid extraction technology, has provided us with a more

viable, cost-effective, supply chain solution that enables making the best out of a bad set of

circumstances. The Group will also continue in its endeavours to strategically search for suitable

synergistic partners and opportunities.

Throughout this post-acquisition and COVID pandemic period, there have been considerable costs

incurred during development and/or downsizing of all of the start-up AAG businesses and management

has been extremely diligent in ensuring that such initial and consequential costings are to now be

commensurate with real-time performance criteria and actual achievements, especially given the

ensuing effects and constraints of COVID and limited financing calling for a more conservative

approach.

Ross Group Plc & Subsidiaries

Summary and Highlights

For the year ended 31 December 2021

Therefore, wherever possible and/or necessary, the Group’s specialist supply chain management

experience has been highly re-focused upon implementing newer strategic disciplines, procedures and

protocols in order to try to provide the best possible performance in its endeavours over time; hence the

consideration and approval by the Board to the RGP-525 new venture as an investment holding, thus

enabling the Group to seek out other opportunities, preferably potentially start-up and pre-financed in a

more strategically secured structure.

The resulting loss for the year was £2.576m (2020: £1.245m) which duly reflects the respective

restructuring, working capital costs and expenses to date.

2021

2020

2019

£ 000’s

Restated

Revenues

Other income

136

14,502

Total costs

(2,582)

(1,424)

(17,441)

────

(Loss) for the year

(2,576)

(1,245)

(2,939)

════

Ross Group Plc & Subsidiaries

Chairman’s Statement

For the year ended 31 December 2021

It is once again my pleasure to report to you on both the business activities and the financial results of

the Ross Group Plc for the financial year ended 31st December 2021.

Having endured the unprecedented occurrence of COVID and a number of consequential as well as

also some unrelated challenges, we are pleased and proud to announce that your Board has been able

to respond as best as possible through taking diligent and prudent measures accordingly.

In addition, the Group is still actively deploying our specialist supply chain management services on a

project-by-project basis and we are also, particularly at present, evaluating several strategic start-up

opportunities that given a post-COVID pandemic period are believed to be worthy to explore.

Since becoming Chairman, over 10 years ago, I have always been mindful - even while our Board of

Directors were constantly busy with such exploratory work - that our operating businesses and Premium

Listing Company status should always be capable of generating sufficient profit and/or cashflow in order

to primarily cover running costs of the business on a potentially worst-case scenario. Therefore, through

these exceptionally unusual COVID years we have had to rightfully reorganize and incur such significant

restructuring expenses - which are considered to be reasonable given our previous many years of

careful and conservative costings.

In this respect, our 2021 result of a £2.576m loss (2020: £1.245m loss) is considered by the Board to

be both understandable and justifiable under such circumstances.

There was no revenue in the year. Costs have increased over 2020 and relate predominantly to various

restructuring, operational, accounting and legal costs.

The Board and myself remain satisfied with the ongoing progress that we have made over this last

year’s cumulative challenges by identifying, initiating, and implementing our respective emergency

and/or restructuring strategic plans.

We will continue to be prudent and focused in our specialist supply chain service management and also

our Board remains conservatively confident that we will be able to progressively focus in on identifying

and being able to put forward an appropriate refined start-up strategy of opportunities for the Board to

consider and to hopefully be able to then present to our Shareholders at some stage in the foreseeable

future.

Regarding the continuing subject of Brexit, given our domiciled departure from the EU, the timing, terms

and impact of the United Kingdom’s exit are still considered difficult to predict; especially with the

combined confluence post-COVID and also the recent predictive effects of the Ukrainian-Russian

conflict. Regardless of the anticipated time scale, terms and conditions of the United Kingdom’s exit

from the European Union, the result with regard to these political and economic events provides an

outlook where it is anticipated that there may be some volatility on the exchange rate between the

Pound Sterling (“£”) and the Euro (“€”) and more generally, between the £/Pound and other international

currencies such as the US Dollar (“US$”).

Because some subsidiaries are presently based both in the United States and/or also outside of Europe,

they are therefore predominately in a US$ currency environment and while this could lead to adverse

consequences in terms of US$/£ exchange rates, our respective subsidiaries and/or joint ventures are

not yet fully trading or selling products, and therefore we do not anticipate any material negative impact

and do not intend to take specific measures to cover fluctuations of the currency market at this stage.

Ross Group Plc & Subsidiaries

Chairman’s Statement

For the year ended 31 December 2021

As always, I would like to particularly personally thank our Board of Directors, our specialist contractors,

consultants and advisors, for all their excellent support, commitment and hard work in helping the Group

wherever possible towards achieving its aims.

Again and again, I would also like to personally thank our extraordinary loyal shareholders for their

continued patience, understanding and support during this extraordinary period in time.

Sincerely

Barry Richard Pettitt

Chairman & Group Managing Director

Ross Group Plc

Date: 20th September 2022

Ross Group Plc & Subsidiaries

Group Strategic Report

For the year ended 31 December 2021

The Directors are pleased to present their strategic report of the Group and the Company for the year

ended 31 December 2021.

Background and History

The existing management team that took over control of the Ross Group Plc approximately thirteen

years ago has been consistent in their prime objective to search for suitable supply chain start-up

opportunities in order to try to build a balance of businesses that would be commensurate with the

respective existing and potential value of the Group’s Premium Listed Main Board status and, as a

result, would also enable the Group to be able to potentially enter into more mergers and acquisitions

in the foreseeable future, whenever deemed appropriate, that in turn could create a sizeable, stable

and potentially prosperous long term enlarged Group going forward.

Business Strategy: 2022 Model & Principal Activity

During 2020, Ross Group Plc’s Archipelago Aquaculture Group (“AAG”) entered into a new venture with

525 Solutions (“525”), a company that was founded in 2015 by Professor Robin Rogers, who created,

co-patented and licensed the Ionic Liquid extraction process that was initially exclusively sub- licensed

by AAG and who together in 2018 they had respectively collaborated together to be able to win the USA

environmentally prestigious EPA Green Chemical Award. Given the constraints of COVID together with

an unexpected reduction of pre-agreed R&D financing, a more refined restructuring strategy was

required, It was therefore the considered opinion of both Ross Group Plc and 525 that as this Ionic Liquid

extraction process has never yet been mass produced to such a high grade quality and quantity, there

could be significant synergies in collaborating together in a collaborative strategic new venture,

in order to try to successfully attain such a World class, ground-breaking achievement. Therefore, in

2021, RGP-525 - albeit under unique and challenging COVID circumstances - was duly created and

has endeavoured to continue to further its research and development as a separate business unit, in

which the Group has a 19.9% investment holding, thus enabling Ross Group Plc to maintain its prime

objective to re-focus to search for other suitable supply chain management opportunities in order to try

to build a balance of businesses that would be commensurate with its respective existing and/or

potential value as a Premium Listed Company on the Main Board of the London Stock Exchange.

Business Review 2021

The Group as at 31 December 2021 consisted of Ross Group Plc and three wholly owned subsidiaries;

Ross Diversified Trading Limited (“RDT”), Ross Group Plc Inc. and Archipelago Aquaculture Group LLC

(“AAG”).

AAG continues to contain the start-up businesses of Mari Signum Limited, Mari Signum Dragon Drying-

MS LLC, Mari Signum Mid-Atlantic LLC and Prometheus Progenitor Genetics Technologies Limited

LLC - all having been initially involved and integrated within the main Chitin-based business of AAG.

These subsidiaries have strategically been operationally restructured in favour of combining certain

Chitin corporate assets and equipment with those of 525 Solutions (a company founded by Professor

Robin Rogers, who is the collaborative creator of the ionic liquid extraction process for Chitin) and, in

doing so, forming a new venture, RGP525 Solutions LLC, in which AAG has an investment holding of

19.9%.

Whereas the main focus of the Board, throughout the last decade and to date is to consistently continue

to explore various promising start-up or existing business opportunities around the World, it is

envisioned that through our restructuring efforts in 2021 the ability for us to re-focus on these new

endeavours in 2022 should help enable us to be able to provide further opportunities for consideration

in the near future.

Regarding the Group’s revenue performance in 2021, while undergoing the continued restructuring of

the Group during the constraints of COVID and restricted cashflow, all operations were either

suspended and/or wound-down respectively in favour of the RGP-525 new Venture with 525 Solutions,

along with a further restructuring of AAG in order to accommodate a more enhanced, efficient and

effective separate business unit strategy.

Ross Group Plc & Subsidiaries

Group Strategic Report

For the year ended 31 December 2021

The Directors are confident that, given its reasonably resolute structure and strategies, the underlying

value of the Group should be able to remain strong and that the Group will hopefully find success in

securing the strategic business that it is currently seeking.

Regarding the financial position at year-end 2021, the Board can report that the Group’s statement of

financial position shows that through such restructuring efforts total assets are £394k compared to

£1,449k in 2020.

It is also worth noting that, in prior years, one of the largest items in the Group’s balance sheet was the

long-term “Interest-bearing loans and borrowings” of £6.072m that has since been restructured into

Convertible Loan Debentures, which were approved by the Board and Shareholders accordingly in 2020

and have been subsequently restructured in 2021 and extended for up to a further one to three years

(at the Board’s discretion) potentially until 2025. Thus the Group has managed to maintain a relatively

healthy cashflow position through the diminishment of this liability and also by the issuance of new

shares.

Business Outlook

The Board is reasonably confident, notwithstanding the COVID Pandemic and its subsequent ongoing

economic effects, that there will still be various unique and exciting opportunities ahead - particularly in

the short-term - for its business to be sustained and/or transformed for potential growth to be considered

in the future.

As at the reporting date, the Group held £209k in cash, total assets of £394k and current liabilities of

£3,875k, including amounts owed to associated undertakings of £2,335k.

Contemplation of cancelling all deferred shares, resulting in a one-off exceptional gain, is currently

under consideration by the Board in order to provide a platform for future investment opportunities.

The budgets and cashflows set for 2022 & 2023 given ensuing partial COVID Pandemic provisions,

indicate that there are sufficient working capital reserves, especially given prudent provisions.

Economic Considerations

In the light of the ongoing COVID pandemic and the uncertainties this brings, the Directors have also

prepared cashflow forecasts to December 2023. These cashflows have been sensitized to assess the

adequacy of cash available should further COVID restrictions, global fuel prices, recession and/or

inflation impinge the activities of the Group. Based on the sensitivity testing and additional resources

available the directors are satisfied the group can continue as a going concern for the foreseeable

future.

Due to the emergency measures implemented by the respective Governments, which are still ongoing

in certain respects, and also given the subsequent strategic RGP-525 new venture regarding the

development cycle of Chitin, the Group has already taken prudent steps to minimise the cost exposure

of its activities accordingly.

The Group is regularly reviewing its initial projections and also aiming to minimise any potential deficits

over the next financial year by trying to reduce all non-essential expenditure.

Ross Group Plc & Subsidiaries

Group Strategic Report

For the year ended 31 December 2021

Section 172(1) Statement

Within the strategic report for this financial year is the mandated Section 172(1) Statement which hereby

describes how the Board of Directors have acted in regard to the matters set out in Section 172(1)(a)

to (f) when performing their duties under this Section.

These duties have included, but are also not necessarily limited to, their responsibility to earnestly

promote the success of the Group and its companies, to act in the way that he or she considers to be

in good faith and would be most likely to promote the success of the Group and its companies for the

benefits of its shareholders as a whole, and other stakeholders.

The Directors welcome the opportunity to also engage with our shareholders and other stakeholders,

wherever possible, in promoting and discussions regarding reasonable, non-price sensitive

information on subjects that are only available within the Public Domain.

In both the Chairman’s Statement and in this Strategic Report, the Chairman and directors have detailed

the matters affecting the Group during the year particularly the subsequent restructuring of AAG.

The acquisition of AAG during 2018/2019 together with the effects of COVID, a reduction of pre-agreed

financing from the seller of AAG and ongoing restructuring implementation have had significant impacts

on the Group and have subsequently resulted in a consecutive loss for the year.

The details given in these reports, particularly on pages 6 & 7, outline the Directors strategy for the

business both in the short and the longer term.

The main factor facing the Directors is the ongoing financing of the group and/or any impact that the

COVID-19 pandemic may have on the business. These matters have had due consideration by the

directors and are detailed in the Strategic Review, in the Business Review 2021, Business Outlook and

Corona Virus pandemic considerations on pages 6 & 7 and Principal Risks and Uncertainties on page

At the end of last year it was reported that there was only one employee (excluding the directors)

remaining at the year-end (none UK) and that employee is now on a part-time employment. During the

current year more employees had joined the group as the previously dormant subsidiary, Ross

Diversified Trading Limited had now become more active, however, it has since been decided to

restructure their employment, respective roles and responsibilities while also considering other

opportunities that may perhaps be presented by them and/or other parties in the foreseeable future.

The main stakeholders are the shareholders and the directors are committed to acting in their best

interest and communicate to them at the AGM and through regular correspondence and/or webinars,

whenever deemed relevant, as well as through timely filing of informative interim and year-end financial

statements, stock exchange announcements and as detailed in the Governance Report on page 12.

As detailed in the Strategic Report on pages 6 to 11 the directors are proud of the Group’s Premium

Listing on the Main Board of the London Stock Exchange and therefore always have the desirability of

the Group and its companies maintaining a reputation for high standards of business conduct as also

detailed in the Governance Report on page 15.

As the Group is continuing to be focused on research and development through its relationship in the

RGP-525 new venture with 525 Solutions and the key relationship with Professor Robin Rogers, it can

confirm that there is little or no impact that the Group has on its community or environment as detailed

on page 10 of the Strategic Report.

Whilst the Group has sufficient cash and reserves to meet its current needs as detailed in the Strategic

Report on page 7, the directors are always striving to increase revenue and raise funds for strategic

opportunities they view are beneficial to the Group shareholders.

Ross Group Plc & Subsidiaries

Group Strategic Report

For the year ended 31 December 2021

Principal Risks and Uncertainties

Notwithstanding the Coronavirus Pandemic, the main risk to the existing operations of the Group is the

possibility of depleting necessary working capital. The Board is both fully aware of these risks and, as

a result, has always endeavoured to managed its cash and cashflow as conservatively and prudently

as possible; ensuring that its exposure to any RGP-525 liabilities in this instance are primarily limited to

its initial investment.

Due to time constraints the company has not been able to publish the 2021 accounts before the deadline

of 30 June 2022. As a result of this the trading of the company’s shares has been suspended on the

London Stock Exchange. It is understood that this suspension will be removed when the financial

statements are published.

In addition, the Board is equally endeavouring to ensure that funds are being made available to the

Group, through the issuance of new shares and/or other financial instruments, whilst also exploring

other opportunities for future growth.

Your Directors are therefore reasonably confident that the Group currently has both the financial

resources and capability to fund existing expenses for future growth.

Viability Statement

The Group’s business activities, together with the factors likely to affect the future performance and

position are set out in the Group Strategic Report and Going Concern Statement on pages 6 to 11

Having endured a protracted period of the COVID Pandemic over the last 2 years, the Group has now

begun to take a longer term view of various post-COVID Pandemic potential factors, ranging from Global

and/or Continental inflation and recession, through to perhaps other opportunities arising in such

markets, for example, in Crypto exchanges and/or Supply Chain Management (SCM) services.

Given the current listing of the Group on the Main Board of the London Stock Exchange and also it’s

present Premium Listing status, both of which individually and/or collectively are of considerable value,

the Group believes that it is in a viable position to be able to enter into either possible start-ups, joint

ventures, mergers and/or acquisitions; any of which would probably involve an injection of new

management and business(es) that could transform the Group significantly.

In addition, the Group’s existing business potential is presently beginning to take shape in its

commodity-based trading and supply chain management services; with initial contracts being

forecasted and/or envisioned accordingly.

As recently demonstrated, new share issuances have been successfully placed to date and there

seems to be a continued interest for possible or potential further new share issuances in the foreseeable

future.

Breakdown by sex of directors

At 31 December 2021 there are five directors: five men and no women.

Ross Group Plc & Subsidiaries

Group Strategic Report

For the year ended 31 December 2021

Environmental

matters

– UK Companies

In the year under review, the activities of all of the RGP UK companies (Ross Group, the parent) and

Ross Diversified Trading (a subsidiary) involved no direct manufacturing, mining or materials

processing. The UK based Directors mostly worked from home, made frequent use of telecoms/remote

conferencing to discuss company business and occasionally met at hired premises.

The Board considers that in such circumstances, the carbon emissions arising from those Directors’

activities (excluding the Chairman) are minimal.

The Chairman, Mr Barry Richard Pettitt who in the past has previously travelled extensively around the

world, accompanied occasionally by other directors, had in fact not travelled internationally at all during

2020 however he has started to travel more extensively in 2021 in pursuit of new opportunities.

Therefore, the total number of business miles the Ross directors travelled in 2021 is calculated at

44,443 which, per the conversion factor taken from the Carbonify.com, website amounts to 23.2 kg

CO2.

– US Companies

The acquisition of AAG in January 2019 meant that the Group now had for the first time in many years

research and development facilities with industrial processing/manufacturing premises. Given aforesaid

circumstances, these were restructured accordingly, as discussed elsewhere in this report, so that the

commercial production of Chitin - a powerful, natural polymer containing characteristics with the

potential to alter industries and improve the environment – now forms an integral part of a new venture,

namely, RGP-525 which intends to use its best endeavours to produce market-ready, premium quality

Chitin in an environmentally conscious manner at some time in the future. This investment is being

monitored and managed through Ross Group PLC Inc., which is also responsible for the Group’s other

USA investments and activities. All US Companies have managed to maintain a minimal number of

employees and/or sub-contractors.

The Board of Directors are very proud to be partly responsible for such an environmentally friendly new

venture operation and subsidiaries that are also, wherever possible, committed to similar standards,

ethics and governance.

The Board of Directors, who are responsible for the day-to-day management of the Group, have

considered the requirements of the FCA new Listing Rule to enhance climate- related financial

disclosures for periods beginning on or after I January 2021 and the associated recommendations of

the Task Force on Climate Related Financial Disclosures (TCFD).

The TCFG recommend disclosures are made specifically in the areas of governance and risk

management with regard to climate related risks and opportunities and where material the strategy and

metrics and targets used to assess such risks and opportunities.

The Board at their regular meetings consider all risks and opportunities facing the Group. The current

limited operations of the Group, in the judgement of the Board, do not give rise to significant risks and

opportunities related to climate – related matters and the Board have therefore not fully made all

disclosures consistent with the some or all of the TCFD’s recommendations and / or recommended

disclosures on the grounds of materiality.

The Board at regular meetings, from a governance perspective, has continued oversight of operations,

they consider any climate -related matters that may arise from changing activities and any risks or

opportunities that may arise. These matters are considered for the short, medium and long-term impact

they may have and the Board continues to strive to support a low carbon economy.

Ross Group Plc & Subsidiaries

Group Strategic Report

For the year ended 31 December 2021

From a risk management perspective any opportunities being considered by the Board must also

highlight as part of that due diligence any risks associated with the opportunity. The impact any climate-

related matters may have resulting from its location, changing climate conditions we are seeing develop

that may impact the future of such an opportunity be it from rising temperatures resulting in flood, fire,

rising sea levels or such other climate – related matters, climate related policy or emerging technologies.

The risks are not only considered from the Group’s perspective but from that of our supply chain and

customers also. The Board consider the impact any such risks may also have on our ability to raise

future capital or restructure debt should that be required.

There are no such climate -related risks identified at this time and the possible opportunities being

considered by the Board be it through the investment in RGP-525 or other opportunities under

consideration do not give any additional climate - related risks.

On behalf of the Board

……………………………………

Barry Richard Pettitt – Chairman

Date:20th September

2022

Ross Group Plc & Subsidiaries

Report of the Directors

For the year ended 31 December 2021

The directors present their report with the financial statements of the company and the group for the

year ended 31 December 2021.

Dividends

No dividends will be distributed for the year ended 31 December 2021.

Events since the end of the year

Information relating to events since the end of the year is given in the notes to the financial statements.

Directors

B R Pettitt (Chief Executive Officer)

Barry Richard Pettitt, aged 62, was appointed to the board on 22 December 2008 as the CEO of the

group and elected as its Chairman and CEO on 28 April 2009. He has more than 30 years’ experience

within the consumer electronics and supply chain management industries, during which time he

successfully started a specialist supply chain management services company. ISO International

(Holdings) Ltd, which was subsequently purchased by a Hong Kong Public Company for HK$

155,000,000 in 2003. In addition, he has managed a number of Public Company divisions (in the

capacities of President and Managing Director) and successfully relisted a Hong Kong Public Company,

Vision Tech Ltd, as its CEO in 2007. Prior to that, he was the joint Managing Director of Ross Consumer

International Ltd and a main board director of the Ross Group (formerly Ross Consumer Electronic Plc)

in 1987 after which he has continued to be a shareholder in Ross Group for the last 34 years.

S C Mehta (Executive Director)

Shashi Mehta, aged 64, was appointed on the board on 22 December 2009. He holds a BSc (Hons) in

Manufacturing and has had a distinguished career in a variety of industrial and manufacturing trouble-

shooting roles. He brings a wealth of experience and expertise to the Group. He spent many years

working for the Ford Motor Company, and was Operations Manager in Ross Consumer Electronics

during the 1980’s.

R E Tamraz (Non- Executive Director)

Roger Tamraz aged 81, was appointed to the Board in December 2020 as a Non-Executive Director.

He is an international banker and venture capital investor who has had an active business career in

banking, oil and gas spanning from Middle East to USA. Fluent in English, French and Arabic, he was

Chairman of Kidder, Peabody & Co. Middle East. Also has owned and controlled banks in the Middle

East and in the United States; Also, having led the takeover and then re- built the largest bank in

Lebanon, Intra Bank.

P M Fisher

Philip Fisher aged 68, was appointed to the board in February 2021. He was the joint Managing Director

of Ross Consumer International Ltd., a subsidiary of Ross Group (formerly Ross Consumer Electronic

Plc) in 1988/89 and has since maintained an excellent working relationship with its senior management

for many years. He will oversee new business divisions and/or developments within the UK.

Newly Elected Directors

M J L d’Hombres (Non- Executive Director)

Marc d’Hombres aged 75, was appointed to the board in December 2021 as a Non-Executive Director.

He is a loan and economics graduate from Paris university and has in-depth experience managing

boutique investment banks and private equity funds. He is well versed in the African markets and an

expert in trade and project financing.

Ross Group Plc & Subsidiaries

Report of the Directors

For the year ended 31 December 2021

Financial Instruments

Details of the financial instruments used by the group can be found in note 22 of the accounts.

Employee Involvement

During the year there was an average of 3 employees, and 5 Main Board directors.

Directors Interests

Directors

Mr Barry Pettitt has from time to time entered into contracts with Ross Group concerning the provision

of professional services to third parties and/or subsidiaries. Apart from this, no director had any interests

in contracts of significance with the company.

In accordance with the Articles of Association members will be asked to confirm the appointment of all

directors.

The total number of shares controlled by Barry Pettitt, directly and indirectly through Lynchwood

Nominees Limited (previously Prime Growth Enterprises Limited) at the date of this report was

27,305,609 (11.72%). Mr Pettitt has sought and obtain Board approval to specifically negotiate and

possibly increase his shareholding interests as well as to further his loan position with Group on existing

financial instruments

Substantial shareholdings

As at 31 December 2021 the following were registered as being materially interested in 4% or more of

the company’s issued share capital, or being a related shareholder.

No of

Ordinary Shares

% of Issued

Share Capital

Keniworth Capital Limited

40,000,000

17.17%

Vidacos Nominees Limited

37,033,448

15.89%

Lynchwood Nominees Limited Des: 2006442

27,078,369

11.62%

Escalating Investments Limited

22,200,720

9.53%

Ross Group Plc & Subsidiaries

Report of the Directors

For the year ended 31 December 2021

Statement of Directors’ Responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in

accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that

law the directors have elected to prepare the financial statements in accordance with International

Financial Reporting Standards as adopted by the UK and the Republic of Ireland. Under company law

the directors must not approve the financial statements unless they are satisfied that they give a true

and fair view of the state of affairs of the company and the group and of the profit or loss of the group

for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have bene followed, subject to any material

departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume

that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and

explain the company’s and the group’s transactions and disclose with reasonable accuracy at any time

the financial position of the company and the group and enable them to ensure that the financial

statements comply with the Companies Act 2006. They are also responsible for safeguarding the

assets of the company and the group and hence for taking reasonable steps for the prevention and

detection of fraud and other irregularities.

Directors’ Responsibility Statement

We confirm that to the best of our knowledge:

The financial statements, prepared in accordance with International Financial Reporting Standards

as adopted by the UK and the Republic of Ireland, give a true and fair view of the assets, liabilities,

financial position and profit or loss of the company and the undertakings included in the

consideration taken as a whole; and

The management’s report, which is incorporated into the Directors’ Report together with the

information provided in the Chairman’s Statement, the Strategic Report, includes a fair review of

the development and performance of the business and the position of the company and the

undertakings included in the consolidation as a whole, together with a description of the principal

risks and uncertainties that they face.

Statement as to disclose of information as Auditors

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of

the Companies Act 2006) of which the group’s auditors are unaware, and each director has taken all

the steps that he ought to have taken as a director in order to make himself aware of any relevant audit

information and to establish that the group’s auditors are aware of that information.

Auditors

In accordance with section 485 of the Companies Act 2006, a resolution proposing that CBW Audit

Limited be re-appointed will be put at the forthcoming Annual General Meeting in 2022.

On behalf of the Board

…………………………..

M J L d’Hombres Director

Date: 20th September 2022

Ross Group Plc & Subsidiaries

Corporate Governance Statement

For the year ended 31 December 2021

Application of The Principles of the UK Corporate Governance Cod

The group is pleased to present its report on Corporate Governance and the UK Corporate Governance

Code. The board strives to comply with the high standards set by the UK Corporate Governance Code

as incorporated in the UK Listing Rules of the Financial Conduct Authority. The Code requires the

company to make a two-part disclosure statement, firstly on how the principles of the code are applied

and secondly confirmation of compliance or explanation of any reason for deviation from the Code.

Throughout the year the company has complied with the main principles of the Code.

The Board

There is an effective and appropriately constituted board which in the year under review consisted of

five directors. The Chief Executive, Mr Pettitt who is normally based overseas, also serves as Chairman.

The board is fully aware that this is contrary to Code provision A.2.1, which states that the roles of

chairman and chief executive should not be exercised by one individual. The board is of the opinion

that, given the current size of the business, and also Mr Pettitt’s undoubted and considerable

knowledge, experience and contacts in the Group’s field of operations that the shareholders’ interests

are best served by this arrangement. The board is active in its management of the group and meets

and confers regularly on business matters arising. These frequent and robust discussions serve to

ensure that no one individual has unfettered powers of decision.

During 2021 Mr Pettitt was supported by four other directors: Mr P.M. Fisher being appointed in January

2021 and Mr M J Simon, who was appointed in April 2009 and retired in December 2021, Mr S C Mehta

who was appointed in December 2009, and Mr R Tamraz being appointed in December 2020.

Mr Simon who acted as company secretary since April 2009, resigned on 14 September 2022.

Mr S C Mehta was appointed as the company secretary on 14 September 2022.

One director resigned from the board in December 2021 Mr M J Simon.

One new director was appointed December 2021 Mr M J L D’Hombres.

The two non-executive directors, Mr D’Hombres and Mr Tamraz, are considered to be independent as

there are no circumstances or relationships as described by Code provision B.1.1 which apply to their

appointments. The group’s definition of a non-executive director is one who considers the interest of all

the shareholders and this is demonstrated during the board meetings. As part of their role, the non-

executive directors constructively challenge decisions and help develop strategies and plans for the

benefit of the board.

Board procedure

The board is responsible for decisions concerning strategic and financial planning and matters involving

the overall direction of the company. Management will seek board approval of the annual budget and

rolling business plan. Reforecasts are presented as updates to the budget throughout the year to

account for variances and provide forward vision. The operational business decisions are taken by local

management with reference to the board where necessary.

The board has established several separate committees for the following: Appointments (Chaired by

Mr Pettitt);

Audit & Remuneration (Chaired by Mr D’Hombres);

Governance & Compliance (Chaired by Mr Mehta)

All of the directors are subject to periodic re-election and also the full board considers all appointments.

A director will require re-election within a maximum period of three years.

Biographies of the board are included in the financial statements. These indicate a wealth of experience,

which is essential in effectively managing the activities of the group. In addition to this the board

members, wherever deemed appropriate and/or possible, endeavour to attend relevant seminars and

courses of their respective professional organisations.

Ross Group Plc & Subsidiaries

Corporate Governance Statement

For the year ended 31 December 2021

Attendance

Board meetings are held regularly throughout the year. Due to the location of the directors, the meetings

are often held electronically. The board is supplied with all the information relevant to the meeting in a

timely manner and in a form and quantity appropriate to enable it to discharge its duties during the

meetings.

The board has now established procedures in respect of access to the company secretary and the

directors have access to consult the company secretary when required.

All shareholders have the opportunity to put forward questions to the board during the company’s

Annual General Meeting and the board communicates with the shareholders via the notices and other

papers relating to the Annual General Meeting. The company also welcomes and responds wherever

possible to communication, preferably in a written form, from its Shareholders regarding reasonable,

non-price sensitive information requests on subjects that are only available within the Public Domain.

The company website allows shareholders to contact the directors by email.

The board has carried out a formal and rigorous annual evaluation of its performance and of its

committees and individual directors. This evaluation covers contribution, commitment and the manner

in which board related duties have been completed. The chairman has discussed the review with

individual directors where necessary to ensure the board operates as an effective unit. The performance

review was conducted using recognised evaluation processes. The independent non- executive director

has conducted a performance review on the chairman which included the consideration of the views

expressed by the executive directors.

Internal audit and control

The respective responsibilities of the directors and the auditors in connection with the financial

statements are set out in the audit report. The directors have overall responsibility of the effectiveness

of the group’s whole system of internal control, including financial and other controls, which are

designed to provide reasonable but not absolute assurance against material misstatement or loss. The

key procedures that the directors have established to provide effective internal financial control are as

follows:

Financial Reporting

There is a comprehensive system for reporting performance. During the course of the year, a one year

rolling budget is prepared for each company within the group and a consolidated budget is prepared for

the whole group. The board then formally approves the budgets. The results are then reported regularly

to the board for their consideration and forecasts are revised accordingly.

Quality and Integrity of Personnel

The integrity of the group is maintained through the appointment of experienced and professional staff

and the application of appropriate policies and procedures.

Capital Investment

The group has set procedures for capital expenditure. These include annual budgets, appraisals and

review of the required expenditure, approvals at the right levels of authority and the commissioning of

independent professional advice where appropriate.

Ross Group Plc & Subsidiaries

Corporate Governance Statement

For the year ended 31 December 2021

Professional Advice

Professional advice is usually sought on contentious and disclosure issues, this being as a result of

discussions during the Board Meetings. During the year the Chairman can seek independent

professional advice in relation to matters affecting the group.

The group has an ongoing system for identifying, evaluating and managing the significant risks faced

by the group which has been in place for the whole of the year under review up to the date of approval

of the annual report and accounts and which is regularly reviewed by the board to ensure it continues

to accord with the UK Corporate Governance Code. The directors have reviewed the effectiveness of

the system of internal financial control during the year from information provided by the management

and the group’s external auditors. It must be recognised that such a system can only provide reasonable

and not absolute assurance, and in that context, the review revealed nothing which, in the opinion of

the directors, indicates that the system was inappropriate or unsatisfactory.

The group has no formal internal audit function and the board has determined that there is no need for

one. The board considers that internal audit is dealt with in other ways and the situation is

regularly reviewed.

Going Concern

The directors confirm that after making the appropriate enquiries, they are of the opinion that the group

as a whole has adequate resources to continue in operational existence for the foreseeable future and

therefore have prepared the financial statements on a going concern basis.

External Audit and Audit Committee

The Audit Committee during 2021 comprised of the non-executive directors, Mr Simon and Mr

D’Hombres, as well as Executive Directors Mr Mehta and Mr Fisher. The committee was chaired by Mr

Simon until 31 December 2021 when this role was passed to Mr D’Hombres. It met periodically to review

the adequacy of the group’s internal control systems, accounting policies, corporate governance

policies and compliance with applicable accounting standards and to consider the appointment of the

external auditors and to review their fees. CBW Audit Limited is invited to attend these meetings. The

Audit Committee is authorised by the board to investigate any activity within its terms of reference and

obtain external professional advice as is necessary.

By order of the Board

Barry Richard Pettitt

Chairman & Group Chief Executive Officer

Date: 20th September 2022

………………………………..

Ross Group Plc & Subsidiaries

Directors’ Remuneration Report

For the year ended 31 December 2021

The board is pleased to present its remuneration report in accordance with section 12.43A(c) of The

Listing Rules.

The board has in place a remuneration committee, comprising Mr Michael Simon, non-executive

director to 31 December 2021, and Mr B Pettitt, Chief Executive, to determine the remuneration of the

board. Post year end Mr Tamraz joined the committee following Mr Simon’s resignation.

The company policy during the restructuring period throughout 2021 was to continue to pay directors

only a nominal £1 salary (which has been in place since 2008). This policy will be reconsidered as

occasion arises and as the new business opportunities open to the group are realised. The directors

feel it would be inappropriate to take any reward until that has been achieved.

Name

Position

Gross

salary

Benefits

Notice

Pay

Total

Remuneration

2021

Total

Remuneration

2020

B R Pettitt

Chairman/

Group Chief

Executive

£1

Nil

£1

M J Simon

Non-

executive

Director

£1

Nil

£1

S C Mehta

Executive

Director

£1

Nil

£1

R E Tamraz

Executive

Director

£1

Nil

£1

P M Fisher

Executive

Director

£1

Nil

£1

M J L D’Hombres

Non-

executive

Director

Nil

No director currently has a service contract with a notice period in excess of 12 months. All executive

directors have contracts that require a notice period of one month. The contracts of the non-executive

directors would normally be renewed for a period of one year. All directors are presented for re-election

by the members at the Annual General Meeting on a maximum cycle of three year.

The group does not currently operate a director’s share option scheme or a long-term incentive system.

The group also does not currently have an employees’ share scheme or other long-term incentive.

The board has instructed local management to ensure the companies address those corporate social

responsibilities which are recognised as being of prime importance. The responsibility for CSR rests

with the Chief Executive Officer, Barry Pettitt, who will bring to the board’s attention any major issues

which require their approval and regularly updates the board on CSR matters. The views of

shareholders and interested external parties are considered when developing the ongoing policy to

CSR.

Figures are available for the board to review to enable them to assess the trend towards improvement

in CSR matters and to direct the policy towards those areas that require further attention.

Ross Group Plc & Subsidiaries

Corporate Social Responsibility (CSR)

For the year ended 31 December 2021

Employees

For several years the only employees of the company were its directors. This changed with the

acquisition of AAG in January 2019. When this happened, the Group inherited 25 employees, this has

now reduced on the reorganisation of AAG.

The group has always taken the view that employees constitute a group’s most valuable asset and

therefore it has always been committed to ensuring they should enjoy the best environment in which to

perform their duties, one of equal opportunity and free from discrimination and harassment.

For reasons discussed elsewhere, it was not possible to continue operations with the four businesses

of AAG constituted as they were, and those facilities during and by the year ended 2019 were

suspended. Consequently, at the year-end 2019 there was only one employee left on the payroll of the

AAG companies. During 2021 this has increased to three and they have been joined by three new

employees in Ross Diversified Trading Limited as this, previously dormant subsidiary commenced

trading in the year 2020. In 2021 trading results proved difficult and numbers have been reduced again.

The group strongly believes in the future of the AAG technology, and we have developed a corporate

structure to facilitate that development through the RGP-525 new venture. We will aim to promote a

culture which suits the recruitment and retention of the highest calibre of staff and to ensure that all staff

will be trained to the appropriate standard required to fully meet their job specifications.

The health and safety of the employees is paramount to the group. Staff are issued with data sheets on

the handling of any substances which might be toxic and will be trained in the correct procedures to

follow. Any potential issues can be raised with Mr Pettitt.

Environment

The board is fully aware of its responsibilities and fully supports the drive for ongoing improvement in

this area. The impact the group’s activities on the environment are regularly assessed to enable action

to be directed at areas where any harmful impact could be reduced. As noted above the travel and

energy use in the group have been limited over the past two years.

The group has worked with its suppliers during the year to ensure the products used in manufacturing

and any waste arising from the use of those products have a minimal impact on the environment. The

use of energy is closely monitored, and the available controls are used to good effect to reduce

consumption where possible.

Customers

Customer satisfaction is one of the main targets for the group and this is aided by a rigorous quality

policy. The Quality procedures adopted by the group require the recording of customer feedback and

measures our performance against customer expectation. The group strives to meet the demands of

its customers, but also ensures that solutions to their requirements are designed with efficiency.

Local Community

The group seeks to inter act with the local community and develop close relationships within its area of

operation. It has established links with the local schools and colleges.

Commitment

The group will continue to enhance its approach to CSR to ensure that it supports the principles as it

expands its range of activities and welcomes any suggestions on how it can improve in this area.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Opinion

We have audited the financial statements of Ross Group Plc (the 'parent company') and its

subsidiaries (the ‘group’) for the year ended 31 December 2021 which comprise the group and parent

company’s Income Statements, Statements of Comprehensive Income, Statements of Financial

Position, Statements of Changes in Equity, Statements of Cash Flows and notes to the consolidated

financial statements, including a summary of significant accounting policies. The financial reporting

framework that has been applied in their preparation is applicable law and International Financial

Reporting Standards (IFRSs) as adopted by the United Kingdom.

In our opinion the financial statements:

give a true and fair view of the state of the group’s and of the parent company's affairs as at

31 December 2021 and of the group’s and the parent company’s loss for the year then

ended;

have been properly prepared in accordance with IFRSs as adopted by the United Kingdom;

and

have been prepared in accordance with the requirements of the Companies Act 2006 and,

as regards the group financial statements, Article 4 of the IAS regulation.

Separate opinion in relation to IFRSs as issued by the IASB

As explained in note 2 to the group financial statements, the group in addition to complying with its

legal obligation to apply IFRSs as adopted by the United Kingdom, has also applied IFRSs as issued

by the International Accounting Standards Board (IASB).

In our opinion the group financial statements give a true and fair view of the consolidated financial

position of the group as at 31 December 2021 and of its consolidated financial performance and its

consolidated cash flows for the year then ended in accordance with IFRSs as issued by the IASB.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK))

and applicable law. Our responsibilities under those standards are further described in the Auditor’s

responsibilities for the audit of the financial statements section of our report. We are independent of

the group in accordance with the ethical requirements that are relevant to our audit of the financial

statements in the UK, including the FRC’s Ethical Standard as applied to listed public interest entities,

and we have fulfilled our other ethical responsibilities in accordance with these requirements. We

believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for

our opinion.

Material uncertainty related to going concern

We draw attention to note 2 in the financial statements, which indicates that there are events or

conditions identified that may cast significant doubt on the entity’s ability to continue as a going

concern. The Company’s listing with the London Stock Exchange is currently suspended, which

creates uncertainty in respect of the timing of its re-listing. This unknown time frame has an effect

on future trading and cash flows. In addition to this, the Company and Group have presented a loss

for the year ended 31 December 2021, and, at the balance sheet date, both have net current

liabilities. As stated in note 2, these events or conditions, along with the other matters as set forth in

note 2, indicate that a material uncertainty exists that may cast significant doubt on the company’s

ability to continue as a going concern. Our opinion is not modified in respect of this matter.

In auditing the financial statements, we have concluded that the directors’ use of the going concern

basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of

the directors’ assessment of the entity’s ability to continue to adopt the going concern basis of

accounting included

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Obtaining management’s assessment of going concern of the Group and challenged the

appropriateness of the assumptions used by utilising our knowledge of the Group gained

throughout the audit and obtaining further corroborative audit evidence.

Analysing forecasts prepared by management covering a period to 31 December 2023, which

have been flexed using different variables for events over the corresponding period.

Reviewing minutes of meetings of the Board for any factors that may affect going concern.

Assessing the wider macro-economic environment over the period, in particular with respect

of COVID-19 and Brexit.

Considered publicly available information to identify if there is anything to contradict the

assessment made by management, or if there are any indicators of potential risk to the group

of industry.

Assessing the appropriateness of going concern disclosure.

In relation to the entity’s reporting on how they have applied the UK Corporate Governance Code, we

have nothing material to add or draw attention to in relation to the directors’ statement in the financial

statements about whether the director’s considered it appropriate to adopt the going concern basis of

accounting.

Our responsibilities and the responsibilities of the directors with respect to going concern are described

in the relevant sections of this report.

Our approach to the audit

Tailoring of the audit scope

We tailored the scope of our audit to ensure that we performed enough work to be able to give an

opinion on the financial statements as a whole, taking into account the structure of the group and the

company, the accounting processes and controls, and the industry in which they operate

The group consists of the parent company and a subsidiary incorporated in the UK, for which a full

scope audits were conducted, and an American based group (AAG), which consists of five companies

and Ross Group Plc Inc. All subsidiaries were considered to be significant components, therefore audit

work was completed on material balances. These group companies are listed in note 12 of the financial

statements. There were no acquisitions during the reporting period, therefore the scope has not

changed significantly compared to the prior period.

Procedures have been conducted on a group level to ensure the amounts brought into the consolidation

are not materially misstated.

Materiality

The scope of our audit was influenced by our application of materiality. We set certain quantitative

thresholds for materiality. These, together with qualitative considerations, helped us to determine the

scope of our audit and the nature, timing and extent of our audit procedures on the individual financial

statement line items and disclosures and in evaluating the effect of misstatements, both individually and

in aggregate on the financial statements as a whole.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Key Audit Matter

How our scope addressed this matter

Revenue recognition

Revenue is recognised in accordance with the

accounting policy set out in the notes to the

consolidated financial statements (set out in

note 2). The accounting policy contains a

number of judgements with regards to

revenue earned from contracts. This is

considered to be a significant risk due to it

often being contingent on external variables.

Performed substantive testing. We tested

a sample of transactions from the point of

origin, which were the original contracts,

and traced these to the financial

statements. Revenue of Ross Diversified

Trading (RDT) tested substantively per

the above. However, it was found that

there was no further trading income to be

recognised in the year, which is consistent

with understanding of the business.

Assessed whether income transactions

were recorded in compliance with IFRS 15

and constitute an agent or principal

relationship. Assessed the

appropriateness of the related disclosures

in the financial statements and consider

them to be reasonable.

The key observations with regards to

these risks were that we concurred that

revenue had been recognised in

accordance with IFRS 15 Revenue from

contracts with customers and is materially

appropriate or accurate.

Non-compliance with laws and regulations

Ross Group Plc has a premium listing on the

London Stock Exchange, and therefore needs

to comply with a high level of regulation. Non-

compliance with these laws and regulation

could result in the parent company being de-

listed from the London Stock Exchange, which

would threaten the group and parent

company’s ability to continue. This is

considered to be a significant risk.

Performed testing to ensure that the

parent company is up to date with relevant

fees due to regulators. Performed testing

to ensure that all returns are submitted in

accordance with requirements and within

the specified timescales. Performed a

detailed analysis of the relevant laws and

regulations and discussed with

management to outline the control

processes to ensure compliance with

these rules.

They key observation with regards to this

risk was that the parent company is

generally compliant with the requirements

of the London Stock Exchange. It is noted

that the Company is not currently

compliant with the London Stock

Exchange rules with regards to the filing of

the financial statements, and the shares

are currently suspended.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Key Audit Matter

How our scope addressed this matter

Going concern

The group is considered by the board to be a

going concern, and the accounts have been

prepared as appropriate on this basis, and

therefore this judgement should be assessed.

As the majority of the group companies do not

trade or generate revenues, and the group is

in a net liabilities position, there is a risk of

material uncertainty relating to going concern,

compounded with the current economic

climate as a result of COVID-19.

In order to address this risk, a detailed

review of going concern was conducted,

which involved reviewing management’s

forecasts for the period up to December

2023, and challenging the assumptions

made in preparation of this. Sensitivity

analysis was conducted, and a ‘worse’

case scenario was assessed to consider

the impact of this. Detailed discussions

have been had with management on

future plans, review of board meeting

minutes, and review of the

appropriateness of the going concern

disclosure in note 2. The application of

materiality is not as applicable in this area

since this relates to the overall

appropriateness of applying the going

concern principle.

The key observations with regards to this

risk are that due to the suspension of the

shares with the London Stock Exchange,

and the lack of financial support for the

Company, there is a material uncertainty

relating to going concern.

Accounting estimates

We will assess the impairments made by

management to ensure that investments and

fixed assets are not materially misstated in the

financial statements.

We obtained an understanding of the

impairment process and evaluated the

impairment methodology and, tested the

accuracy and completeness of the

impairment review assessments. We

gathered evidence from third parties,

where possible, to corroborate cost

assumptions included in calculations for

future activity of operations for the

forecasts. For those assets or investments

impaired previously, we evaluated the

actual results and the assumptions made

and considered if reversals were required.

We checked the recoverability of the

receivables in AAG's accounts to gain

direct written confirmations on the

existence of these assets from third

parties. And obtained evidence from third

parties of financial stability and ability to

repay to test recoverability. We enquired

management regarding the intention of

the group balances, and whether these

should be netted off.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Our application of materiality

Based on our professional judgement, we determined materiality for the financial statements as a

whole as follows: group and parent company materiality for the financial statements as a whole at

£29,100 and £26,300 respectively, which is based on 2% of loss before tax after the removal of

exceptional items at the planning stage. Materiality has been set using this measure as this is

considered to represent the most appropriate measure of underlying performance, which is the most

sensitive measure being a listed group. The group and parent company performance materiality

adopted is 50% of this figure, which was calculated as £14,500 and £13,100 respectively. This is

deemed by the audit team to be an appropriate level to identify material errors, which is used for a

high-risk audit. The materiality at completion has been assessed and it was noted that the loss before

tax had increased as a result of an audit adjustment, however it was concluded that materiality should

not be amended. Materiality has influenced our workings not only for the key audit matters but also for

the rest of the work performed during the audit. Anything below £1,450 and £1,300 was considered

trivial from a group and parent company perspective respectively.

We agreed with the audit committee that we would report to them misstatements identified during

our audit above £1,450 or £1,300 as appropriate as well as misstatements below that amount that,

in our view, warranted reporting for qualitative reasons.

Other information

The other information comprises the information included in the annual report other than the financial

statements and our auditor’s report thereon. The directors are responsible for the other information

contained within the annual report. Our opinion on the financial statements does not cover the other

information and, except to the extent otherwise explicitly stated in our report, we do not express any

form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing

so, consider whether the other information is materially inconsistent with the financial statements or

our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material misstatements, we are required to

determine whether this gives rise to a material misstatement in the financial statements themselves.

If, based on the work we have performed, we conclude that there is a material misstatement of this

other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, the part of the directors’ remuneration report to be audited has been properly prepared

in accordance with the Companies Act 2006. In our opinion, based on the work undertaken in the

course of the audit:

− the information given in the strategic report and the directors’ report for the financial year for

which the financial statements are prepared is consistent with the financial statements and

those reports have been prepared in accordance with applicable legal requirements;

− the information about internal control and risk management systems in relation to financial

reporting processes and about share capital structures, given in compliance with rules 7.2.5

and 7.2.6 in the Disclosure Rules and Transparency Rules sourcebook made by the Financial

Conduct Authority (the FCA Rules), is consistent with the financial statements and has been

prepared in accordance with applicable legal requirements; and

− information about the company’s corporate governance code and practices and about its

administrative, management and supervisory bodies and their committees complies with rules

7.2.2, 7.2.3 and 7.2.7 of the FCA Rules.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its

environment obtained in the course of the audit, we have not identified material misstatements in;

− the strategic report or the directors’ report; or

− the information about internal control and risk management systems in relation to financial

reporting processes and about share capital structures, given in compliance with rules 7.2.5

and 7.2.6 of the FCA Rules.

We have nothing to report in respect of the following matters in relation to which the Companies Act

2006 requires us to report to you if, in our opinion:

− adequate accounting records have not been kept by the parent company, or returns adequate

for our audit have not been received from branches not visited by us; or

− the parent company financial statements and the part of the directors’ remuneration report

to be audited are not in agreement with the accounting records and returns; or

− certain disclosures of directors’ remuneration specified by law are not made; or

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

− a corporate governance statement has not been prepared by the parent company.

Corporate governance statement

The Listing Rules require us to review the directors' statement in relation to going concern, longer-

term viability and that part of the Corporate Governance Statement relating to the group's compliance

with the provisions of the UK Corporate Governance Statement specified for our review.

Based on the work undertaken as part of our audit, we have concluded that each of the following

elements of the Corporate Governance Statement is materially consistent with the financial

statements or our knowledge obtained during the audit:

− Directors' statement with regards the appropriateness of adopting the going concern basis

of accounting and any material uncertainties identified (set out on page 10);

− Directors’ explanation as to its assessment of the entity’s prospects, the period this

assessment covers and why they period is appropriate (set out on page 13).

− Directors' statement is fair, balanced and understandable (set out on page 14);

− Board’s confirmation that it has carried out a robust assessment of the e-merging and

principal risks (set out on page 14);

− The section of the annual report that describes the review of effectiveness of risk

management and internal control systems (set out on page 13); and;

− The section describing the work of the audit committee (set out on page 14).

Responsibilities of directors

As explained more fully in the directors’ responsibilities statement set out on page 11, the directors are

responsible for the preparation of the financial statements and for being satisfied that they give a true

and fair view, and for such internal control as the directors determine is necessary to enable the

preparation of financial statements that are free from material misstatement, whether due to fraud or

error. In preparing the financial statements, the directors are responsible for assessing the company’s

ability to continue as a going concern, disclosing, as applicable, matters related to going concern and

using the going concern basis of accounting unless the directors either intend to liquidate the company

or to cease operations, or have no realistic alternative but to do so.

Auditor’s Responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole

are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that

includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an

audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the

aggregate, they could reasonably be expected to influence the economic decisions of users taken on

the basis of these financial statements.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design

procedures in line with our responsibilities, outlined above, to detect material misstatements in respect

of irregularities, including fraud. The extent to which our procedures are capable of detecting

irregularities, including fraud is detailed below:

We ensured that the engagement team collectively had the appropriate competence, capabilities and

skills to identify or recognise non-compliance with applicable laws and regulations. The laws and

regulations applicable to the company were identified through discussions with directors and other

management, and from our commercial knowledge and experience of a premium listed group

undertaking various global activities. Of these laws and regulations, we focused on those that we

considered may have a direct material effect on the financial statements or the operations of the

company, including the Listing Rules of the Financial Conduct Authority (FCA), Companies Act 2006,

taxation legislation, data protection, anti-bribery, anti-money-laundering, employment, environmental

and health and safety legislation. The extent of compliance with these laws and regulations identified

above was assessed through making enquiries of management and inspecting legal correspondence.

The identified laws and regulations were communicated within the audit team regularly and the team

remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company’s financial statements to material misstatement,

including obtaining an understanding of how fraud might occur, by:

− making enquiries of management as to where they considered there was susceptibility to

fraud, their knowledge of actual, suspected and alleged fraud;

− considering the internal controls in place to mitigate risks of fraud and non-compliance with

laws and regulations; and

− understanding the design of the company’s remuneration policies.

To address the risk of fraud through management bias and override of controls, we:

− performed analytical procedures to identify any unusual or unexpected relationships;

− tested journal entries to identify unusual transactions;

− assessed whether judgements and assumptions made in determining the accounting

estimates set out in note 2 were indicative of potential bias; and

− investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed

procedures which included, but were not limited to:

− agreeing financial statement disclosures to underlying supporting documentation;

− reading the minutes of meetings of those charged with governance;

− enquiring of management as to actual and potential litigation and claims; and

− reviewing correspondence with HMRC, relevant regulators including the FCA and the

company’s legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws

and regulations are from financial transactions, the less likely it is that we would become aware of non-

compliance. Auditing standards also limit the audit procedures required to identify non-compliance with

laws and regulations to enquiry of the directors and other management and the inspection of regulatory

and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to

detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website

at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Report of the Independent Auditors to the Members of Ross Group Plc & Subsidiaries

For the year ended 31 December 2021

Other matters which we are required to address

Following the recommendation of the audit committee, we were appointed by the board of directors

on 20 May 2021 to audit the financial statements for the year ending 31 December 2021 and

subsequent financial periods. The period of total uninterrupted engagement is 3 years, covering the

years ending 31 December 2019 to 31 December 2021.

The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the group or

the parent company and we remain independent of the group and the parent company in conducting

our audit.

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

Use of our report

This report is made solely to the parent company’s members, as a body, in accordance with Chapter

3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state

to the parent company’s members those matters we are required to state to them in an auditor’s report

and for no other purpose. To the fullest extent permitted by law, we do not accept or assume

responsibility to anyone other than the parent company and the parent company’s members as a body,

for our audit work, for this report, or for the opinions we have formed.

Ross Group Plc & Subsidiaries

Consolidated Income Statement

For the year ended 31 December 2021

Revenue

Notes

2021

£’000

2020

£’000

Restated

Production expenses

Gross profit / (loss)

────

(39)

────

Other operating income

135

Administrative expenses

Operating (loss)

(1,878)

────

(1,873)

(894)

────

(755)

Finance income

Finance expense

(Loss) before income tax

(704)

────

(2,576)

(491)

────

(1,245)

Income tax

(Loss) for the year

────

(2,576)

════

────

(1,245)

════

(Loss) attributable to:

Owners of the parent

(2,576)

(1,245)

════

Earnings per share expressed in pence per share:

Basic

(1.11)

(0.57)

Diluted

(0.85)

════

(0.44)

════

Earnings per share from continuing operations

Basic

(1.11)

(0.57)

Diluted

(0.85)

════

(0.44)

════

The notes form part of these financial statements.

Ross Group Plc & Subsidiaries

Company Income Statement

For the year ended 31 December 2021

The notes form part of these financial statements.

Continuing operations

Notes

2021

£’000

2020

£’000

Restated

Revenue

Other operating income

Administrative expenses

Operating (loss)

(2,782)

────

(2,760)

(220)

────

(190)

Finance costs

(Loss) before income tax

(612)

────

(3,372)

(366)

────

(556)

Income tax

(Loss) for the year

────

(3,372)

════

────

(556)

════

Ross Group Plc & Subsidiaries

Consolidated Statement of Comprehensive Income

For the year ended 31 December 2021

The notes form part of these financial statements.

2021

£’000

2020

£’000

Restated

(Loss) for the year

(2,576)

(1,245)

Exchange losses arising on translation of foreign operations

(13)

(89)

Total comprehensive income for the year

────

(2,589)

════

────

(1,334)

════

Total comprehensive income attributable to:

Owners of the parent

(2,589)

(1,334)

════

Ross Group Plc & Subsidiaries

Company Statement of Comprehensive Income

For the year ended 31 December 2021

The notes form part of these financial statements.

2021

£’000

2020

£’000

Restated

(Loss) for the year

(3,372)

(556)

Exchange losses arising on translation of foreign operations

Total comprehensive income for the year

────

(3,372)

════

────

(556)

════

Ross Group Plc & Subsidiaries (Registered Number: 00131902)

Consolidated Statement of Financial Position

31 December 2021

The notes form part of these financial statements.

Assets

Notes

2021

£’000

2020

£’000

Restated

Current assets

Trade and other receivables

117

310

Cash and cash equivalents

Non-Current assets

209

─────

326

─────

401

─────

Investments

424

Property, plant and equipment

313

Right-of-use assets

311

Intangible assets

Total assets

Equity

─────

394

═════

─────

1,048

─────

1,449

═════

Shareholders’

equity

Called up share capital

11,232

11,218

Share premium

3,540

3,146

Other reserves

15,384

Convertible debenture

4,692

5,145

Translation reserve

(212)

(199)

Retained earnings

Total equity

Liabilities

(41,943)

─────

(7,307)

─────

(39,820)

─────

(5,126)

─────

Non-current liabilities

Lease liabilities

183

Financial liabilities

3,003

2,551

Provisions

Current liabilities

813

─────

3,826

─────

2,734

─────

Trade and other payables

3,315

3,408

Lease liabilities

208

Financial liabilities

Total liabilities

523

─────

3,875

─────

7,701

─────

225

─────

3,841

─────

6,575

─────

Total equity and liabilities

394

═════

1,449

═════

The financial statements were approved by the Board of Directors on 20th September 2022 and were

signed on its behalf by:

………………………………………. ……………………………………….

B Pettitt – Director M J L d’Hombres – Director

Ross Group Plc & Subsidiaries (Registered Number: 00131902)

Company Statement of Financial Position

31 December 2021

The notes form part of these financial statements.

Assets

Notes

2021

£’000

2020

£’000

Restated

Current assets

Trade and other receivables

763

Cash and cash equivalents

Non-Current assets

193

─────

271

─────

807

─────

Investments

627

Property, plant and equipment

─────

647

─────

Total assets

287

─────

1,454

─────

Equity

Shareholders’

equity

Called up share capital

11,232

11,218

Share premium

3,540

3,146

Other reserves

30,938

Convertible debenture

4,692

5,145

Retained earnings

Total equity

(55,239)

─────

(4,837)

─────

(52,320)

─────

(1,873)

─────

Liabilities

Non-current liabilities

Financial liabilities

3,003

2,551

Provisions

813

─────

3,816

─────

2,551

─────

Current liabilities

Trade and other payables

914

551

Financial liabilities

394

─────

1,308

─────

225

─────

776

─────

Total liabilities

5,124

─────

3,327

─────

Total equity and liabilities

287

═════

1,454

═════

The financial statements were approved by the Board of Directors on 20th sept 2022 and were signed

on its behalf by:

……………………………… ………………………………

B Pettitt – Director M J L d’Hombres – Director

Ross Group Plc & Subsidiaries

Consolidated Statement of Changes in Equity

For the year ended 31 December 2021

The notes form part of these financial statements.

Called up

Share capital

Retained

earnings

premium

£’000

Restated

£000

Balance at 1 January 2020

11,218

(38,784)

3,146

Changes in equity

Issue of share capital

Total comprehensive income

(1,245)

Derecognition of conversion rights on loans

Value of conversion rights on convertible loans

Balance at 31 December 2020

─────

11,218

─────

209

─────

(39,820)

─────

3,146

─────

Changes in equity

Issue of share capital

394

Total comprehensive income

(2,576)

Derecognition of conversion rights on loans

Value of conversion rights on convertible loans

Balance at 31 December 2021

─────

11,232

─────

453

─────

(41,943)

─────

3,540

─────

Translation

Other

Convertible

Total

reserves

debenture

equity

£’000

Restated

£’000

Restated

£’000

Restated

Balance at 1 January 2020 (110)

15,384

5,354

(3,792)

Changes in equity

Issue of share capital -

Total comprehensive income (89)

(1,334)

Derecognition of conversion rights

on loans -

(5,354)

Value of conversion rights on

convertible loans -

5,145

5,354

─────

Balance at 31 December 2020 (199)

15,384

5,145

(5,126)

─────

Changes in equity

Issue of share capital -

408

Total comprehensive income (13)

(2,589)

Derecognition of conversion rights

on loans -

(5,145)

Value of conversion rights on

convertible loans -

4,692

5,145

─────

Balance at 31 December 2021 (212)

15,384

4,692

(7,307)

═════

Ross Group Plc & Subsidiaries

Company Statement of Changes in Equity

For the year ended 31 December 2021

The notes form part of these financial statements.

Called up

Share capital

Retained

earnings

premium

£’000

Restated

£000

Balance at 1 January 2020

11,218

(51,973)

3,146

Changes in equity

Issue of share capital

Total comprehensive income

(556)

Derecognition of conversion rights on loans

Value of conversion rights on convertible loans

Balance at 31 December 2020

─────

11,218

─────

209

─────

(52,320)

─────

3,146

─────

Changes in equity

Issue of share capital

394

Total comprehensive income

(3,372)

Derecognition of conversion rights on loans

Value of conversion rights on convertible loans

Balance at 31 December 2021

─────

11,232

─────

453

─────

(55,239)

─────

3,540

─────

Other

reserves

£’000

Convertible

debenture

£’000

Restated

Total

equity

£’000

Restated

Balance at 1 January 2020

30,938

5,354

(1,317)

Changes in equity

Issue of share capital

Total comprehensive income

(556)

Derecognition of conversion rights on loans

(5,354)

Value of conversion rights on convertible loans

Balance at 31 December 2020

─────

30,938

─────

5,145

─────

5,145

─────

5,354

─────

(1,873)

─────

Changes in equity

Issue of share capital

408

Total comprehensive income

(3,372)

Derecognition of conversion rights on loans

(5,145)

Value of conversion rights on convertible loans

Balance at 31 December 2021

─────

30,938

═════

4,692

─────

4,692

═════

5,145

─────

(4,837)

═════

Ross Group Plc & Subsidiaries

Consolidated Statement of Cash Flows

For the year ended 31 December 2021

The notes form part of these financial statements.

Notes

Cash flows from operating activities

2021

£’000

2020

£’000

Restated

(Loss) before income tax

(2,576)

(1,125)

Investment impairment provision

486

Depreciation of property, plant and equipment

Loss of sale of property, plant and equipment

2,711

121

Reverse impairment of property, plant and equipment

(3,048)

(167)

Impairment of property, plant and equipment

207

Amortisation of right-of-use assets

202

Impairment of intangible assets

Foreign exchange adjustments

(4)

Finance expense

704

282

Finance income

(1)

────

(1,689)

(1)

────

(468)

Decrease / (Increase) in trade and other receivables

212

(187)

Decrease in inventories

(Decrease) / increase in trade and other payables

Net cash from operating activities

592

────

(885)

────

453

────

(163)

────

Cash flows from investing activities

Purchase of fixed asset investments

(62)

(424)

Purchase of property, plant and equipment

(13)

(65)

Proceeds from sale of property, plant and equipment

867

470

Interest received on loans

Net cash from investing activities

────

793

────

(18)

────

Cash flows from financing activities

Issue of ordinary shares

408

Proceeds from new loans issued

401

162

Repayment of loans and borrowings

(3)

Interest paid on loans and borrowings

(247)

(250)

Principal paid on lease liabilities

(345)

(219)

Interest paid on lease liabilities

(4)

(32)

Amount withdrawn by directors

Net cash from financing activities

────

210

────

(38)

────

(377)

────

(Decrease) / increase in cash and cash equivalents

118

(558)

Cash and cash equivalents at beginning of year 1

Cash and cash equivalents at end of year 1

────

209

════

649

────

════

Ross Group Plc & Subsidiaries

Company Statement of Cash Flows

For the year ended 31 December 2021

The notes form part of these financial statements.

Notes

2021

£’000

2020

£’000

Restated

Cash flows from operating activities

(Loss) before income tax

(3,372)

(347)

Impairment provision

689

Foreign exchange adjustment

Finance cost

612

157

Depreciation

────

(2,056)

────

(190)

Decrease / (Increase) in trade and other receivables

703

(236)

Increase in trade and other payables

Net cash from operating activities

1,157

────

(196)

────

331

────

(95)

────

Cash flows from investing activities

Purchase of fixed asset investments

(62)

(424)

Purchase of property, plant and equipment

Net cash from investing activities

────

(62)

────

(20)

────

(444)

────

Cash flows from financing activities

Issue of ordinary shares

408

Proceeds from new loans issued

160

138

Repayment of loans and borrowings

(3)

Interest paid on loans and borrowings

(159)

(158)

Amount withdrawn by directors

(33)

Amount introduced by directors

Net cash from financing activities

────

407

────

(53)

────

Increase / (decrease) in cash and cash equivalents

149

(592)

Cash and cash equivalents at beginning of year 1

Cash and cash equivalents at end of year 1

────

193

════

636

────

════

Ross Group Plc & Subsidiaries

Notes to Statement of Cash Flow

For the year ended 31 December 2021

Cash and cash equivalents

The amounts disclosed on the Cash Flow Statements in respect of cash and cash equivalents

are in respect of these Balance Sheet amounts:

Year ended 31 December 2021

Group

Company

31/12/21 01/01/21

£’000 £’000

31/12/21 01/01/21

£’000 £’000

Cash and cash equivalents

209 91

════ ════

193 44

════ ════

Year ended 31 December 2020

31/12/20 01/01/20

£’000 £’000

Cash and cash equivalents

91 649

════ ════

44 636

════ ════

The notes form part of these financial statements

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

Statutory Information

Ross Group Plc is a public company, limited by shares, registered in England and Wales. The

company’s registered number and registered office address can be found on the General

Information page. The subsidiary, Ross Diversified Trading Limited, is a private company limited

by shares and registered in England and Wales. The subsidiary, Ross Group Plc Inc, is a close

corporation, limited by shares and registered in USA. The subsidiary, Archipelago Aquaculture

Group LLC, is a limited liability company registered in USA.

The following companies are all subsidiaries of Archipelago Aquaculture Group LLC.

The subsidiary, Mari Signum Limited, is a company limited by shares and registered in USA. The

subsidiary Mari Signum Mid-Atlantic LLC, is a limited liability company registered in USA. The

subsidiary Mari Signum Dragon Drying – MS LLC, is a limited liability company registered in USA.

The subsidiary Prometheus Progeniture Genetics Technologies Limited LLC, is a limited liability

company registered in USA.

Accounting Policies

Basis of preparation

The consolidated financial statements of Ross Group Plc have been prepared in accordance with

International Financial Reporting Statements (IFRS) and interpretations issued by the IFRS

Interpretations Committee (IFRS IC) as adopted by the UK and the Republic of Ireland and with

the Companies Act 2006 as applicable to companies reporting under IFRS. The financial

statements have been prepared on a historical cost basis and on a going concern basis.

Items included in the financial statements of each of the group’s entities are measured using the

currency of the primary economic environment in which the entity operates (‘the functional

currency’). The consolidated financial statements are presented in British Pounds (GBP), which

is Ross Group Plc’s functional and presentation currency. Amounts are rounded to the nearest

thousand.

In preparing the financial statements for the current period, the group has adopted the following

new IFRS’s, amendments to IFRS’s and IFRS Interpretations Committee (IFRIC)

Interpretations. These standards do not have a significant impact on the results or net assets of

the group.

IFRS 7 (amended) Financial Instruments: Disclosures

IFRS 9 (amended) Financial Instruments

IFRS 16 (amended) Leases

New standards, amendments and interpretations that are not effective for the year ended

31 December 2021

On the date of approval of these financial statements, the following accounting standards have

been issued by the International Accounting Standards Board but were not yet effective:

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

Accounting policies – continued

New standards and amendments which are not effective for the current year and have

been endorsed by the UK and the Republic of Ireland.

•

Amendments to IAS 1 Presentation of Financial Statements (Effective for annual reporting

periods beginning on or after 1 January 2023)

•

Amendment to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors

(Effective for annual reporting periods beginning on or after 1 January 2023)

•

Amendment to IAS 12 Income Taxes (Effective for annual reporting periods beginning on or

after 1 January 2023)

•

Amendment to IAS 16 Property, Plant and Equipment (Effective for annual reporting period

beginning on or after 1 January 2022)

•

Amendment to IAS 37 Provisions, Contingent Liabilities and Contingent Assets (Effective for

annual reporting periods beginning on or after 1 January 2022)

•

Amendment to IFRS 3 Business Combinations (Effective for annual reporting period

beginning on or after 1 January 2022)

•

IFRS 17 Insurance Contracts (Effective for annual reporting periods beginning on or after 1

January 2023)

The Group is in the process of assessing the impact of new and revised standards but does not

expect that the application of the new standards will have a significant impact on the Group’s

financial statements.

Going concern

The Group’s business activities, together with the factors likely to affect the future performance

and position are set out in the Strategic Report on pages 6 to 11.

As described in the Business Review on pages 6 to 7 the Group has restructured its Chitin

operations in favour of entering into an agreement with 525 Solutions who have undertaken a

controlling shareholding in RGP 525 - with the Group holding a balance 19.9% shareholding in

RGP525 - in order to continue to explore opportunities to mass produce Chitin in a way never

before undertaken and, given this, there is undoubtably an uncertainty as to how long it will

take to achieve these aims and generate income. Although this uncertainty exists, the Group

are working with such experts in this field who are also integrally involved in this process and

are therefore confident in the possibility of its long term success. The Directors have instituted

measures to preserve cash by also restructuring the Group’s finances and through the RGP525

venture have ensured the limiting of any further cost exposure, although if the proof of mass

production is proven to be successful, the Group will look to secure additional finance, if so

required. In this respect, our strategic approach and implementation has ceased to create any

cash flow issues flows from this particular sector of the Group’s business.

The Directors have now decided to re-focus their efforts on pursuing other opportunities during

these exceptional post COVID times and have commenced trading within the wholly owned

subsidiary company, Ross Diversified Trading Limited, regarding supply chain management

contracts in the commodities sector. A number of other such opportunities are also currently

being explored in other sectors and it is anticipated that a number of transactions in these

areas will conclude during the 2022 and/or 2023 financial years with a view to increasing both

revenue and profitability in the group.

The Board is reasonably confident, notwithstanding the COVID Pandemic and its subsequent

ongoing economic effects, that there will still be various unique and exciting opportunities

ahead- both in the short term and longer term – in order for its overall business to be sustained

and for potential growth to be considered in the future.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

2. Accounting policies – continued

The Group continues to negotiate the sale of certain assets and the settlement of the current

and contingent liabilities, following the restructure of the AAG group and would hope to bring

these to conclusion in the next twelve to eighteen months. The Board have prepared cash flow

forecasts to December 2023 - including sensitivity testing on these forecasts - and are

reasonably satisfied that once the temporary suspension of the shares is released on filing of

the financial statements the Group has sufficient cash available to it from various sources and

letters of interest to invest in new share offerings in order to meet its liabilities as they fall due

for a period of at least twelve months from the signing of the financial statements.

Based on the above, the Board believe that it remains appropriate to prepare the financial

statements on a going concern basis. However, these circumstances represent a material

uncertainty that may cast doubt on the Company’s and Group's ability to continue as a going

concern and therefore to continue realising its assets and discharging its liabilities in the normal

course of business. The financial statements do not include any adjustments that would result

from this basis of preparation being inappropriate.

Basis of consolidation

The group financial statements consolidate those of the company and of its subsidiary

undertakings drawn up to 31 December 2021. Profits or losses on intra-group transactions and

intra-group balances are eliminated in full. On acquisition of a subsidiary, all of the subsidiary’s

assets and liabilities which exist at the date of acquisition are recorded at their fair values

reflecting their condition at that date.

The AAG group has not generated any revenue, the decision has been made to restructure this

group of companies, post new venture in 2020 and continued in 2021.

Revenue recognition

Revenue is the total amount receivable by the group for goods supplied and services provided

to third parties, excluding VAT.

Revenue from the sale of goods is recognised when the significant risks and rewards of

ownership of the goods has transferred to the buyer. This is usually when the goods have been

delivered to customers such that the risks and removal of ownership have been transferred to

them.

Revenue from contracts for the provision of professional services is recognised by reference to

the stage of completion, when the stage of completion, costs incurred and costs to complete can

be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly

in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where

the outcome cannot be estimated reliably, revenue is recognised only to the extent of the

expenses recognised that are recoverable. A level of judgement is exercised by management in

this regard.

Goodwill

Goodwill represents the excess of the cost of a business combination over the group’s interest

in the fair value of identifiable assets, liabilities and contingent liabilities acquired.

Goodwill is capitalised as an intangible asset with any impairment in carrying value being charged

to the consolidated statement of comprehensive income. Where the fair value of identifiable

assets, liabilities and contingent liabilities exceed the fair value of consideration paid, the excess

is credited in full to the consolidated statement of comprehensive income on the acquisition date.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

2. Accounting policies – continued

Property, plant and equipment

Property plant and equipment are carried at cost or deemed cost (fair value on acquisition through

business combination) less accumulated depreciation and impairment provisions.

Acquisition cost includes the purchase price plus other costs related to acquisition, such as

freight, postage, duties, commissions, interest on investment loans recorded before the tangible

assets are capitalised or before they are put into use.

The costs of expansion, modernisation, or improvements leading to increased productivity,

capacity or efficiency are capitalised. Maintenance and repair expenses are expensed as

incurred.

Where the carrying amount of an asset is greater than the amount that it is estimated to be

recoverable, it is written down to its recoverable amount.

The Group depreciates its property, plant and equipment on a straight line basis in order to write

off the cost of each asset less the estimated residual value over its estimated useful life as follows:

Building 39 years straight line basis

Leasehold improvements Over the term of the lease

Plant, machinery and equipment 7 years straight line basis

Right of use assets Over the term of the lease

Financial instruments

Financial assets and liabilities are recognised on the statement of financial position when the

entity becomes party to the contractual provisions of the instrument.

The Group’s financial instruments consist primarily of cash and cash equivalents, accounts

receivable and accounts payable.

Financial liabilities

The group recognises financial debt when the group becomes a party to the contractual

provisions of the instruments.

Financial liabilities, including borrowings, trade payables and other short-term monetary liabilities,

are initially measured at fair value net of transactions costs directly attributable to the issuance

of the financial liability. They are subsequently measured at amortised cost using the effective

interest method. For the purposes of each financial liability, interest expense includes initial

transaction costs and any premium payable on redemption, as well as any interest or coupon

payable while the liability is outstanding.

Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the group’s obligations are

discharged, cancelled, or they expire.

Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents

includes cash on hand and deposits held at call with financial institutions.

Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised

cost using the effective method, less loss allowance.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

Accounting policies – continued

Prepayments from clients

Payments received in advance on sale contracts for which no revenue has been recognised yet

are recorded as prepayments from clients as the reporting date and carried under liabilities.

Investments and other financial assets

The group classifies its debt instruments in the category those to be measured at amortised cost,

which are assets held for collection of contractual cash flows, where those cash flows represent

solely payments of principal and interest. Financial assets are derecognised when the rights to

receive cash flows from the financial assets have expired or have been transferred and the group

has transferred substantially all the risks and rewards of ownership.

Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in

other gains/(losses) together with foreign exchange gains and losses. Impairment losses are

presented as a separate line item in the income statement. The group subsequently measures

all equity investments at cost.

The group assesses, on a forward-looking basis, the expected credit losses associated with its

debt instruments carried at amortised cost. The impairment methodology applied depends on

whether there has been a significant increase in credit risk.

Trade and other payables

These amounts represent liabilities for goods and services provided to the group prior to the end

of the financial year which are unpaid. The amounts are unsecured and are usually paid within

30 days of recognition. Trade and other payables are presented as current liabilities unless

payment is not due within 12 months after the reporting period. They are recognised initially at

their fair value and subsequently measured at amortised cost using the effective interest method.

Deferred taxation

A deferred tax asset is provided for if material, using the tax rates estimated to arise when the

timing differences reverse and is accounted for to the extent that it is probable that an asset will

crystallise.

Deferred tax is recognised in respect of all timing differences that have originated but not

reversed at the statement of financial position date.

Foreign currencies

Transactions denominated in foreign currencies are translated at the exchange rate ruling at the

date of the transaction. Monetary assets and liabilities in foreign currencies are translated at the

rates of exchange ruling at the year end date. These transaction differences are dealt with in the

income statement. The financial statements of foreign subsidiaries are translated at the rate of

exchange ruling at the year end date. The exchange differences arising from the retranslation of

the opening net investment in subsidiaries are taken directly to reserves.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

Critical accounting estimates and judgements

The Group makes certain estimates and assumptions regarding the future. Estimates and

judgements are continually evaluated based on historical experience and other factors, including

expectations of future events that are believed to be reasonable under the circumstances. In the

future, actual experience may differ from these estimates and assumptions. The estimates and

assumptions that have a significant risk of causing a material adjustment to the carrying amounts

of assets and liabilities within the next financial year are discussed below.

Estimates and assumptions

The determination of lease term for some lease contracts in which the Group is a lessee,

including whether the Group is reasonably certain to exercise lessee options (see note 16)

The determination of the incremental borrowing rate used to measure the lease liabilities (see

note 14)

Depreciation of property, plant and equipment – Estimate of the useful economic life (see note

13)

The determination of the discount rate used to measure the convertible loan debenture (see

note 21)

Impairment of property, plant and equipment – Estimate of the net realisable value of property,

plant and equipment held at the year end (see note 13).

Provision for legal expenses – Estimate of the expenses payable (see note 26).

Impairment of investments – Estimate of the profitability of the companies (see note 12).

Related party debtors – Estimate of the recoverability of the debts (see note 16).

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

Segmental reporting

The directors feel that due to no revenue earned this year and little trading during the previous

year it is not possible to identify any segments and as a result cannot follow IFRS 8. The entire

turnover in the previous year was generated within the UK but delivered overseas through the

rendering of services related to the principal activity of the Group.

The loss for the year was incurred mainly by the parent company itself, Ross Group Plc, based

in the United Kingdom arising from administration costs incurred in pursuit of new opportunities.

Whilst Ross Diversified Trading Limited had a small amount of trade in 2020 this has reduced in

2021 but is anticipated to increase again.

The main contributor to the loss incurred during the previous year was the subsidiary group AAG

LLC based in the USA. This group was acquired in January 2019 and due to unforeseen

circumstances ceased to operate throughout 2020 being included in the prior year financial

statements as a discontinued operation. Expenses are still being incurred for this group as

operations are wound up and/or transferred to its venture RGP-525.

The directors will review this assessment next year.

5. Other operating income

Group

2021

£’000

2020

£’000

Restated

Government grants receivable

135

Compensation receivable

────

════

────

135

════

Company

2021

£’000

2020

£’000

Restated

Other miscellaneous income

════

6. Employees and directors

Employee benefit expenses (including directors) comprise:

2021

2020

Wages and salaries

129,923

Directors’ remuneration

Social security contributions and similar taxes

─────

═════

4,957

─────

134,885

═════

The average number of employees during the year was as follows:

2021

2020

Number

Management

Production

Administrative

────

════

────

════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

7. Loss before income tax

The loss before income tax is stated after charging:

2021

2020

£’000

Restated

Auditor’s remuneration

110

Impairment of investment

486

Amortisation of right-of-use assets

202

Depreciation of property, plant and equipment

Impairment of property, plant and equipment

207

Reverse of impairment of property, plant and equipment

(3,048)

(167)

Loss on disposal of property, plant and equipment

2,471

151

Loss on disposal of right-of-use assets

240

Associated undertaking loan write back

(30)

════

(25)

════

8. Finance income and expense

Group

2021

2020

Finance income

£’000

Restated

Interest income on financial assets

════

Finance expense

2021

£’000

2020

£’000

Restated

Interest expense on financial liabilities

166

185

Interest expense on lease liabilities

Interest expense on convertible debenture

Reserves adjustment of convertible debenture

453

────

704

════

209

────

491

════

Company

2021

2020

Finance expense

£’000

Restated

Interest expense on financial liabilities

Interest expense on convertible debenture

Reserves adjustment of convertible debenture

453

────

612

════

209

────

366

════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

Income tax

No liability for UK corporation tax arose on ordinary activities for the year ended 31 December

2021 or for the year ended 31 December 2020. The Group made a loss during the year.

Subject to the agreement with HM Revenue and Customs, the Group has allowable trading losses

at 31 December 2021 for set-off against future trading profits of £13.78m (2020: £13.25m).

A deferred tax asset of £3.45m (2020: £2.46m) arises due to the large losses described above.

As the timing of when the Group will be able to make use of these losses the asset has not been

recognised in the financial statements.

10.

Earnings per share

Basic earnings per share is calculated by dividing the earnings attributable to ordinary

shareholders by the weighted average number of ordinary shares outstanding during the period.

Diluted earnings per share is calculated using the weighted average number of shares adjusted

to assume the conversion of all dilutive potential ordinary shares.

Reconciliations are set out below.

2021

Weighted

average

number

Pre-

Earnings

£’000

amount

pence

Basic EPS

Earnings attributable to ordinary shareholders

(2,576)

233,000,000

(1.11)

Effect of dilutive securities

Diluted EPS

─────

68,851,000

────────

─────

Adjusted earnings

(2,576)

═════

301,851,000

════════

(0.85)

═════

2020

Weighted

average

number

Pre-

Basic EPS

Earnings

£’000

Restated

amount

pence

Earnings attributable to ordinary shareholders

(1,245)

218,767,475

(0.57)

Effect of dilutive securities

Diluted EPS

─────

64,645,789

────────

─────

Adjusted earnings

(1,245)

═════

283,413,264

════════

(0.44)

═════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

11.

Subsidiaries

At 31 December 2021 the company held 100% of the allotted equity share capital of the

following:-

Country of

Name of subsidiary

registration and Class of share

undertaking

incorporation capital held

Nature of business

Ross Diversified Trading Limited England and Wales Ordinary Supply chain management

(formerly Sansui Electronics (UK)

Limited)

The costs of this fixed asset investment have been written off over the previous periods.

Archipelago Aquaculture Group LLC

Mari Signum Limited

Mari Signum Dragon Drying-MS LLC

Mari Signum Mid-Atlantic II LLC

USA

Ordinary

Intermediate holding company

Aquaculture support

Drying Shrimp hulls

Aquaculture support

Prometheus Progeniture Genetics

Technologies Limited LLC

USA

Ordinary

Genetic enhancement of

colossal shrimp for higher

quality chitin.

Ross Group Plc Inc

USA

Ordinary

Supply chain management

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

12.

Investments

Unlisted

Group investments

£’000

Cost

At 1 January 2021

424

Additions 62

Disposals -

────

At 31 December 2021 486

────

Provisions

At 1 January 2021 -

Impairments 486

Disposals -

────

At 31 December 2021 486

════

Net book value

At 31 December 2021 -

════

At 31 December 2020 424

════

Unlisted

Company investments

£’000

Cost

At 1 January 2021

643

Additions 62

Disposals -

────

At 31 December 2021 705

────

Provisions

At 1 January 2021 16

Impairments 689

Disposals -

────

At 31 December 2021 705

════

Net book value

At 31 December 2021 -

════

At 31 December 2020 627

════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

13.

Property, plant and equipment

Group

Land and

buildings

Plant and

machinery

Totals

£’000

Cost

At 1 January 2021

293

313

Additions

Disposals

(293)

(3,048)

(3,341)

Impairment reversal

3,048

────

─────

At 31 December 2021

════

═════

Depreciation

At 1 January 2021

Charge for the year

Disposals

Impairment

────

─────

At 31 December 2021

════

═════

Net book value

At 31 December 2021

═════

At 31 December 2020

293

313

═════

In December 2019 the group ceased trading in its US subsidiaries, Archipelago Aquaculture

Group LLC, at the time the plant and machinery operated by the group were impaired to nil as

the assets were no longer in use. During 2021 some of the equipment was sold to third parties

resulting in the impairment been reversed.

Company

Plant and

machinery

Totals

£’000

Cost

At 1 January 2021

Additions

Disposals

─────

At 31 December 2021

═════

Depreciation

At 1 January 2021

Charge for the year

Disposals

─────

At 31 December 2021

═════

Net book value

At 31 December 2021

═════

At 31 December 2020

═════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

14. Leases

Right-of-use

Assets

Land and

buildings

£’000

Total

£’000

At 1 January 2021

311

Disposals

(240)

Amortisation

(33)

Foreign exchange movements

At 31 December 2021

─────

═════

─────

═════

Lease liabilities

Land and

buildings

£’000

Total

£’000

At 1 January 2021

391

Interest expense

Lease payments

(345)

Foreign exchange movements

At 31 December 2021

(3)

─────

═════

(3)

─────

═════

Current liabilities

═════

Non Current liabilities

═════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

15. Intangible assets

Group

Goodwill

Total

£’000

Cost

At 1 January 2021

1,684

Additions

Foreign exchange

────

─────

At 31 December 2021

1,684

════

═════

Amortisation

At 1 January 2021

1,684

Charge for the year

Impairment

Foreign exchange

────

─────

At 31 December 2021

1,684

════

═════

Net Book Value

At 31 December 2021

════

═════

At 31 December 2020

════

═════

16. Trade and other receivables

Group

Company

Current:

2021

£’000

2020

£’000

Restated

2021 2020

£’000 £’000

Restated

Trade receivables

- -

Amounts owed by group undertakings

1,374 1,310

Provision for impairment

(1,374) (609)

Amounts owed by associated undertakings

- -

Directors’ current accounts

57 58

Taxation

19 -

VAT

2 -

Prepayments and accrued income

109

- 4

Other debtors

────

117

════

────

310

════

- -

──── ────

78 763

════ ════

17. Cash and cash equivalents

Group

Company

2021

£’000

2020

£’000

2021 2020

£’000 £’000

Bank accounts

209

════

193 44

════ ════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

18. Called up share capital

Group and company

Authorised share capital:

2021

£’000

2020

£’000

195,000,000 Deferred shares of 4.8p each

9,360

67,052,306 Deferred shares of 4p each

2,682

300,000,000 Ordinary shares of 0.1p each

300

2,700,000,000 Deferred shares of 0.1p each

Allotted, called up and fully paid:

2,700

─────

15,042

═════

2,700

─────

15,042

═════

147,745,300 Deferred shares of 4.8p each

7,092

67,052,306 Deferred shares of 4p each

2,682

233,000,000 Ordinary shares of 0.1p each

233

218

1,225,628,316 Deferred shares of 0.1p each

1,225

─────

11,232

═════

1,226

─────

11,218

═════

The ordinary shares have both voting rights and the right to dividends. The deferred shares have

no rights to dividends and no voting rights.

On a winding up the holders of the deferred shares of 4.8p each shall be entitled to receive 1p

per share after the repayment of all amounts payable to the holders of any other class of share

and the payment of £5,000 on each ordinary share for the time being in issue. On a winding up

the holders of deferred shares of 0.1p each shall be entitled to receive 0.1p per share after the

payment of £5,000 on each ordinary share for the time being in issue but shall not confer the right

to participate in any surplus.

The deferred shares of 4.8p each are redeemable at the company’s option any time at a price of

1p for each of the deferred shares held by any member. The deferred shares of 0.1p each are

transferable at the company’s option at any time to any person at a total price of 1p for all of the

shares held by the shareholder. The deferred shares of 0.1p each are redeemable or cancellable

at the company’s option at any time at a total price of 1p for all of the shares held by a shareholder.

As the deferred shares rank behind the ordinary shares, they are recognised as equity.

Managing capital

The Group considers only the allotted share capital set out above to be the capital of the group.

There are no financial liabilities considered to be part of the capital, and no components of equity

excluded from it.

The Group’s objectives when managing capital are:

To safeguard the entity’s ability to continue as a going concern, so that it can continue to

provide returns for shareholders and benefits for other stakeholders.

To provide an adequate return to shareholders by pricing products and services at an

appropriate level taking into account the level of risk.

The Group sets an amount of capital in proportion to risk. The Group manages the capital

structure and makes adjustments to it in the light of changes in economic conditions and risk

characteristics of the underlying assets.

The entity is not subject to any externally imposed capital requirements.

Share Issue

On 15 September 2021 the company issued 13,126,051 ordinary shares for a total consideration

amounting to £377,883.

On 15 October 2021 the company issued 1,106,474 ordinary shares for a total consideration

amounting to £30,981.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

19. Reserves

Group

Retained

earnings

premium

Other

reserves

Translation

reserve

Convertible

debenture

Totals

£’000

At 1 January 2021

(39,820)

3,146

15,384

(199)

5,145

(16,344)

Total comprehensive

income for the year

(2,576)

(13)

(2,589)

Premium on issue of

share capital

394

Debenture

derecognition

(5,145)

Debenture re-

recognition

453

4,692

5,145

─────

────

─────

────

─────

At 31 December 2021

(41,943)

3,540

15,384

(212)

4,692

(18,539)

═════

════

═════

════

═════

Company

Retained

earnings

premium

Other

reserves

Convertible

debenture

Totals

£’000

At 1 January 2021

(52,320)

3,146

30,938

5,145

(13,091)

Loss for the year

(3,372)

Premium on issue of

share capital

394

Debenture

derecognition

(5,145)

Debenture re-

recognition

453

4,692

5,145

─────

────

─────

────

─────

At 31 December 2021

(55,239)

3,540

30,938

4,692

(16,069)

═════

════

═════

════

═════

Other reserves of the Group consist of a capital redemption reserve of £1.92m (2020: £1.92m),

a non-distributable capital reserve of £3.33m (2020: £3.33m) and a special reserve of £10.13m

(2020: £10.13m).

Convertible debenture of the group consists of the equity portion of convertible loan debentures

of £4.692m (2020: £5.145m).

Other reserves of the company consist of a capital redemption reserve of £1.92m (2020: £1.92m)

and a special reserve of £29.02m (2020: £29.02m).

Convertible debenture of the company consists of the equity portion of convertible loan

debentures of £4.692m (2020: £5.145m).

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

20. Trade and other payables

Group

Company

Current:

2021

£’000

2020

£’000

Restated

2021 2020

£’000 £’000

Restated

Trade payables

293

461

58 100

Amounts owed to associated undertakings

2,335

2,226

- -

Amounts owed to group undertakings

561 268

Taxation

19 -

Other creditors

388

376

23 23

Accruals and deferred income

280

────

3,315

════

345

────

3,408

════

253 160

──── ────

914 551

════ ════

21. Financial liabilities – borrowings

Group

Company

Current:

2021

£’000

2020

£’000

Restated

2021 2020

£’000 £’000

Restated

Debentures

346

222

346 222

Bank loans

48 3

Other loans

129

────

523

════

────

225

════

- -

──── ────

394 225

════ ════

Non-current:

Debentures

1,256

846

1,256 846

Bank loans

- 47

Other loans

1,747

────

3,003

════

1,658

────

2,551

════

1,747 1,658

──── ────

3,003 2,551

════ ════

Terms and debt repayment schedule:

1 year

Group

or less

£’000

2-5 years Totals

£’000 £’000

Debentures

346

1,256 1,602

Bank loans

- 48

Other loans

Company

129

────

523

════

1 year

or less

£’000

1,747 1,876

──── ────

3,003 3,526

════ ════

2-5 years Totals

£’000 £’000

Debentures

346

1,256 1,602

Bank loans

- 48

Other loans

────

394

════

1,747 1,747

──── ────

3,003 3,397

════ ════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

21.

Financial liabilities – borrowings – continued

Convertible loan debenture

The parent entity issued two convertible loan debenture (CLD) on 27 September 2018 for £4,010k

and £2,062k at a coupon rate of 5%.

The notes are convertible into Ordinary shares of the parent entity in three years after the date

of issue.

At the Annual General Meeting on 31 December 2020 it was agreed to extend the conversion

period to 26 September 2022.

At the Annual General Meeting on 31 December 2021 it was agreed to extend the conversion

period to 26 September 2025.

At each of the dates of modification the value of the conversion rights were derecognised in the

financial statements and a new valuation of the conversion rights was recognised.

The convertible loan debenture will give right to a percentage of the issued share capital of the

parent company at the date of conversion. Each tranche of £1 Million CLD owed by the long-

term loan holders correspond to 4.925% of the issued share capital at the date of conversion,

resulting in a fixed percentage of the issued share capital of the company to be allocated to the

loan holders regardless of the value/amount of the share capital of the company.

2021

£’000

2020

£’000

Restated

Face value of notes issued

6,072

Value of conversion rights

4,692

────

5,145

────

1,380

927

Interest expense *

222

141

Interest paid

Total liability element

────

1,602

════

────

1,068

════

*Interest is calculated by applying the effective interest rate of 5% to the total loan note amount.

The initial fair value of the liability portion of the debenture was determined using a market interest

rate for an equivalent non-convertible debenture at the issue date. The liability is subsequently

recognised on an amortised cost basis until extinguished on conversion or maturity of the bonds.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

22.

Financial instruments

The Group uses financial instruments, comprising borrowings, cash, liquid resources and various

items, such as trade debtors, trade creditors etc., that arise directly from its operations. The main

purpose of these financial instruments is to raise finance for the group’s operations.

The Group did not enter into derivatives transactions such as interest rate swaps, forward rate

agreements and forward foreign currency contracts.

The Board of the Group considers that the interest rate risk, liquidity risk and foreign currency

risks arising from the Group financial instruments are low. However, it reviews policies for

managing each of these risks and they are summarised below. These policies have remained

unchanged from previous periods.

It is and has been throughout the year under review, the group policy that no trading in financial

instruments shall be undertaken.

Short-term debtors and creditors

Short-term debtors and creditors have been excluded from all the following disclosures, other

than the currency risk disclosures.

Interest rate risk

The Group finances its operations through a mixture of borrowings. It relies on loans from its

shareholders to ensure sufficient liquidity is available to meet foreseeable needs.

Maturity of financial liabilities

For the Group financial liabilities analysis at 31 December 2021 see note 21.

Currency risk

The Group does have foreign investments held in foreign currencies.

The Group’s exposure to translation and transaction exchange risk is considered to be low by

the board.

There was no income in the current year. 100% of the Group’s worldwide income in the prior year

was invoiced in US Dollars and has been settled in 2021. As a result the board does not consider

there is a need for Group policy to manage the currency risk as it considers the risk to be low.

Fair values

The board considers that the fair values of the Group’s borrowings are equal to their book values.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

23.

Related party disclosures

Group

The Group had the following balances with related parties at the year end.

31/12/21 31/12/20

£’000 £’000

Receivables

Barry Pettitt 63 63

════ ════

Barry Pettitt, the Chairman and Chief Executive Officer of Ross Group Plc, owns Lynchwood

Nominees (previously Prime Growth Enterprises Limited). Lynchwood Nominees owns 12% of

the ordinary share capital in Ross Group Plc.

Company

At the year end Ross Group Plc had the following outstanding balances with its related parties:

31/12/21

£’000

31/12/20

£’000

Receivables

Barry Pettitt

Mari Signum Dragon Drying – MS LLC

Prometheus Progeniture Genetics Technologies Limited LLC

164

Ross Group Plc Inc

523

Ross Diversified

────

════

────

759

════

Payables

Mari Signum Mid-Atlantic II LLC

268

Mari Signum Dragon Drying – MS LLC

293

────

561

════

────

268

════

Ross Group Plc owns 100% of the capital of Ross Diversified Trading Limited, Mari Signum

Limited, Mari Signum Dragon Drying – MS LLC, Mari Signum Mid-Atlantic II LLC, Prometheus

Progeniture Genetics Technologies Limited LLC and Ross Group Plc Inc.

Barry Pettitt, the Chairman and Chief Executive Officer of Ross Group Plc, owns Lynchwood

Nominees (previously Prime Growth Enterprises Limited). Lynchwood Nominees owns 12% of

the ordinary share capital in Ross Group plc.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

24.

Ultimate controlling party

The directors consider that there is no ultimate controlling party of Ross Group Plc and

subsidiaries for 2021: however, Barry Pettitt, by virtue of his position as CEO within the Group

and his 12% shareholding, exerts a significant influence.

25.

Reconciliation of movements in reserves 31/12/21 31/12/20

Group £’000 £’000

Restated

(Loss) for the financial year (2,589) (1,334)

Issue of share capital 408 -

Derecognition of conversion rights (5,145) (5,354)

Value of conversion rights 4,692 5,145

Reserves adjustment of convertible debenture

453

209

──── ────

Net addition to reserves (2,181) (1,334)

Opening reserves (5,126) (3,792)

──── ────

Closing reserves (7,307) (5,126)

════ ════

31/12/21 31/12/20

Company £’000 £’000

Restated

(Loss) for the financial year (3,372) (556)

Issue of share capital 408 -

Derecognition of conversion rights (5,145) (5,354)

Value of conversion rights 4,692 5,145

Reserves adjustment of convertible debenture 453 209

──── ────

Net addition to reserves (2,964) (556)

Opening reserves (1,873) (1,317)

──── ────

Closing reserves (4,837) (1,873)

════ ════

26.

Provisions

31/12/21 31/12/20

£’000 £’000

Restated

Balance brought forward - -

Movement in the year 813 -

──── ────

Balance carried forward 813 -

════ ════

The group is involved as defendants in a multi-party lawsuit brought in the United States of

America, a provision has been included in the financial statements to provide for any potential

claim and legal expenses.

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

27.

Prior Year Adjustment

Group

2020 Audited

Correction of

prior year

2020 Restated

Audited

Impact

Restated

£’000

Assets

Inventories

Trade and other receivables

269

310

Cash and cash equivalents

Investments

424

Property, plant and equipment

355

(42)

313

Right of use assets

311

Intangible assets

────

Total Assets

1,450

(1)

1,449

════

Liabilities and equity

Lease liabilities (non-current)

183

Financial liabilities (non-current)

1,705

(846)

2,551

Trade and other payables

3,408

Lease liabilities (current)

208

Financial liabilities (current)

957

732

225

────

Total Liabilities

6,461

(114)

6,575

════

Equity attributable to equity holders of parent

Shareholders’ equity

11,218

Share premium

3,146

Others reserves

15,384

Convertible debentures

5,815

670

5,145

Translation reserve

(199)

Retained earnings

(40,574)

754

(39,820)

────

Total Equity

(5,011)

115

(5,126)

════

Total Liabilities and Equity

1,450

1,449

════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

27. Prior Year Adjustment - continued

Company

2020 Audited

Correction of

prior year

2020 Restated

Audited

Impact

Restated

£’000

Assets

Trade and other receivables

763

Cash and cash equivalents

Investments

627

Property, plant and equipment

────

Total Assets

1,454

════

Liabilities and equity

Financial liabilities (non-current)

1,705

(846)

2,551

Trade and other payables

551

Financial liabilities (current)

957

732

225

────

Total Liabilities

3,213

(114)

3,327

════

Equity attributable to equity holders of parent

Shareholders’ equity

11,218

Share premium

3,146

Others reserves

30,938

Convertible debentures

5,815

670

5,145

Retained earnings

(52,876)

(556)

(52,320)

────

Total Equity

(1,759)

114

(1,873)

════

Total Liabilities and Equity

1,454

════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

27. Prior Year Adjustment - continued

Consolidated Income Statement

2020

Audited

Correction of

prior year

2020 Restated

Audited

Impact

Restated

£’000

Revenue

Production expenses

(39)

Other operating income

127

135

Administrative expenses

(1,056)

162

(894)

Finance income

Finance expense

(539)

(491)

Income tax

────

Loss for the year

(1,463)

218

(1,245)

════

Total comprehensive income

(1,399)

(1,334)

════

Earnings per share (basic)

(0.67)

0.10

(0.57)

════

Earnings per share (diluted)

(0.67)

0.23

(0.44)

════

Company Income Statement

2020 Audited

Correction of

prior year

2020 Restated

Audited

Impact

Restated

£’000

Revenue

Other operating income

Administrative expenses

(220)

Finance expense

(421)

(366)

Income tax

────

Loss for the year

(611)

(556)

════

Ross Group Plc & Subsidiaries

Notes to the Consolidated Financial Statements

For the year ended 31 December 2021

27. Prior Year Adjustment - continued

The Company and Group has restated the balance sheet, statement of other comprehensive income,

statement of financial position, and statement of changes in equity. This is due errors in the accounting

treatment for convertible loan debentures, foreign exchange translation and recognition of a Group

asset which was not owned by the Group. This has been considered as a prior year error and has been

corrected in accordance with IAS 8 (Accounting Policies, Changes in Accounting Estimates and Errors).

The overall impact of this restatement is disclosed in the note above.