IQ Holdings plc - Annual Report and Accounts

RNS Number:1724R
IQ Holdings plc
31 March 2008

FOR IMMEDIATE RELEASE
31 March 2008

IQ HOLDINGS PLC
("IQ Holdings" or the "Company" )

IQ Holdings, the business research and competitive intelligence group, is
pleased to announce results for the year ended 30th September 2007 which was an
eventful year, paving the way for the Company's admission to AiM in conjunction
with the acquisition of Rosslyn Research Ltd ("Rosslyn") in November 2007 and a
successful equity fundraising of £850,000.

HHIGHLIGHTS

• Turnover of £417,701 (2006: £347,200);
• Gross Profits of £312,196 (2006: £253,824);
• Loss on ordinary activities before taxation narrowed to loss of £180,676
(2006: loss £188,502);
• Successful move from PLUS to AiM;
• £850,000 raised through the placing of 42,500,000 ordinary shares at 2p;
• Rosslyn acquired for £600,000 and is delivering immediate economies of
scale; and

• Joe Seydel joins the experienced Board of Directors.

Commenting on today's statement, Tim Hearley, Chairman, of IQ Holdings, said:

"The results show a continued transition from the traditional business of IQ
Research Ltd , the wholly owned trading subsidiary of IQ Holdings, and a
continued investment in developing its financial services research proposition.
In November 2007, we acquired Rosslyn and our shares were admitted to the AIM
market, this was a material event in IQ Holdings' history. The board has made,
and will continue to make, strenuous efforts to grow the group both organically
and through further acquisitions with a view to enhancing shareholder value.
The benefits of the acquisition of Rosslyn are already being experienced, partly
through the ability of the Company to offer a more broadly based range of
services, and partly through the increased turnover and profitability. In the
first two months of 2008 Rosslyn has been awarded new business to a maximum
value of £400,000 and has actually commenced work on new business to a value of
at least £200,000."

Enquiries:

IQ Holdings plc
Julian Green Tel: 020 7328 8823

Grant Thornton Corporate Finance (Nomad)
Gerry Beaney / Fiona Kindness Tel: 020 7383 5100

SVS Securities plc (Broker)
Peter Manfield Tel: 020 7638 5600

Bishopsgate Communications Ltd
Dominic Barretto/ Nick Farmer Tel: 020 7562 3350
iqholdings@bishopsgatecommunications.com

IQ Holdings Plc

Chairman's Report for the Year Ended 30 September 2007

I am pleased to announce the results of IQ Holdings plc ("IQH" or "the Company")
for the year ended 30th September 2007 which was an eventful year, paving the
way for the Company's admission to AiM in conjunction with the acquisition of
Rosslyn Research Ltd ("Rosslyn") in November 2007 and a successful equity
fundraising of £850,000. The results show a continued transition from the
traditional business of IQ Research Ltd ("IQR"), the wholly owned trading
company of IQH, and a continued investment in developing its financial services
research proposition.

The figures for the year show a larger than anticipated loss but this does
include certain items of expenditure which will not be repeated in the current
year. In particular there has been real progress in the development of the
research product designed for the life and pensions industry which is now a
growing source of revenue for the Company.

In November 2007 the Company acquired Rosslyn, a research business offering
complementary services to IQH and additional resource which enables IQH to offer
an extended range of research services on a larger geographic scale and to a
broader range of clients. Specifically, it offers an international quantitative
research capability, a UK field research resource and access to an international
network of independent research companies in many countries around the world.
The acquisition has delivered immediate economies of scale, and based upon its
historical pre-tax profit levels of approximately £100,000 per annum Rosslyn
should have a positive financial impact on the Group. As the acquisition
completed after the period end, these results do not include any contribution
from Rosslyn.

The Company is well advanced in its integration of Rosslyn, having moved into
shared office accommodation in January 2007, nine months prior to completion of
the acquisition. In particular, this enabled the Company to identify potential
synergy for merging the operations of the two businesses. To this end, the
Company is implementing the integration of the information technology systems of
the two businesses and moving the location of the business premises to more
suitable accommodation; both of which will be completed within six months from
the date of the acquisition.

On admission to AiM in November 2007, Joachim (Joe) Seydel, Managing Director of
Rosslyn, joined the board of directors. Joe is an experienced researcher, well
known within the market research industry and a regular speaker at trade
conferences. The Board was further strengthened by the appointment of Peter
Parkinson as a non executive director, who also temporarily assumes
responsibility of Finance Director as Neil McGowan recovers his health. Janette
Weir, an executive director of IQR also was appointed to the Company's board,
bringing additional management experience. Both of these appointments were made
in January 2008.

The benefits of the acquisition of Rosslyn are already being experienced, partly
through the ability of the Company to offer a more broadly based range of
services, and partly through the increased turnover and profitability. In the
first two months of 2008 Rosslyn has been awarded new business to a maximum
value of £400,000 and has actually commenced work on new business to a value of
at least £200,000.

The board is confident that following the above changes these will be reflected
in significantly increased levels of trading and profitability. The board has
made, and will continue to make, strenuous efforts to grow the group both
organically and through further acquisitions with a view to enhancing
shareholder value.

Tim Hearley

Chairman

Date: 28th March 2008

Directors' Report for the Year Ended 30 September 2007

The directors present their report and the audited consolidated financial
statements for the year ended 30 September 2007.

Directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial
statements in accordance with applicable law and United Kingdom Generally
Accepted Accounting Practice.

Directors are required by company law to prepare financial statements which give
a true and fair view of the state of affairs of the group at the end of the
financial year and of the profit or loss of the company and group for the period
ending on that date. In preparing those financial statements, directors are
required to:

- select suitable accounting policies and apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable accounting standards have been followed, subject to
any material departures disclosed and explained in the financial statements;
- prepare the financial statements on a going concern basis unless it is
inappropriate to presume that the group will continue in business.

The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and group and enable them to ensure the financial statements comply with
the Companies Act 1985. They have general responsibility for taking such steps
as are reasonably open to them to safeguard the assets of the company and group
and to prevent and detect fraud and other irregularities.

Each director has taken steps that they ought to have taken as a director in
order to make themselves aware of any relevant audit information and to
establish that the company's auditors are aware of that information. The
directors confirm that there is no relevant information that they know of and
which they know the auditors are unaware of.

Principal activity

The principal activity of the group has continued to be providers of market
research and market information.

Business review and Future Developments

A review of the group's trading during the financial period, including future
developments is included in the Chairman's Report on Page 2.

Key Performance Indicators

The Group considers its key performance indicator to be turnover. Turnover has
increased during the year as outlined in the Profit and Loss account due to
growth from existing and new customers.

Principal Risks and Uncertainties Facing the Group

The Group's principal Risk has been liquidity risk. The group's policy has been
to ensure continuity of funding through placing of shares and negotiation of
banking facilities. The group's credit risk is attributable to its trade debtors
and the amounts presented in the balance sheet are net of allowances for
doubtful debts.

Payment of Creditors

The group's policy for all suppliers is to fix terms of payment when agreeing
the terms of each business transaction to ensure that the supplier is aware of
those terms and to abide by the agreed terms of payment.

Research and Development

The group has continued to undertake the development of research products and
these costs have been expensed in the profit and loss account.

IFRS

AIM listed companies are required to apply IFRS to their Financial Statements
for their first accounting period commencing on or after 1 January 2007. For the
group this will be the accounting period ending 30 September 2008. The Interim
Report will be prepared in accordance with IFRS.

Going concern

The financial statements have been prepared on a going concern basis not
withstanding net liabilities of £185,078 and a Loss for the financial year of
£180,676. As noted in Note 21 on page 26 and in the Chairman's Report on page 2,
since the year end the company has raised additional funds and acquired Rosslyn
Research Limited. However, the directors acknowledge that the validity of the
going concern basis remains dependent on the achievement of the subsidiary
companies' trading forecasts prepared by the directors and the ability of the
company to raise additional funding to meet its cash flow requirements should
these forecasts not be achieved. This should enable the Company to continue in
operational existence for the foreseeable future by meeting its liabilities as
they fall due for payment.

Based on this understanding, the directors believe that it remains appropriate
to prepare the financial statements on a going concern basis. The financial
statements do not include any adjustments, particularly as the regards the
carrying value of goodwill, which would result from the basis of preparation
being inappropriate.

Results and dividend

The results for the group are set out in the financial statements.

The directors do not recommend the payment of a dividend.

Directors

The directors who held office during the year were as follows:
- T M Hearley
- R A Martin (resigned 31 December 2006)
- J E Green
- N G McGowan

The following directors were appointed after the year end:
- J Seydel (appointed 29 November 2007)
- P W Parkinson (appointed 22 January 2008)
- J Weir (appointed 31 January 2008)

Share options

The unapproved share option scheme, adopted by the Company on 9 February 2005,
was terminated pursuant to a board resolution of the Company passed on 12
September 2007. The option scheme rules provided that the directors of the
Company were able to grant non-transferable options to acquire ordinary shares
in the Company to directors, employees and consultants of the Group. The option
scheme rules provided that the options granted under the 2005 Scheme were
exercisable in whole or in part by an option holder during the four years
following the expiration of a period of three years from the date of grant of
the option, and that any options lapsed automatically where the option holder
ceased to be in the employment of a member of the Group.

Options were issued on 9 February 2005 to Tim Hearley (in respect of 100,000
shares) and on 21 February 2005 to R A Martin (in respect of 100,000 shares), N
G McGowan (60,000 shares) and A Taralle (50,000 shares) a director of IQ
Research Limited. R A Martin has ceased to be in the employment of the Group and
his options have therefore lapsed. N G McGowan, A Taralle and T Hearley have
each executed a deed of waiver dated 7 August 2007, to waive all entitlement
under the share option scheme. There were therefore no options outstanding on
the termination of the scheme.

In the directors' opinion these options had no value prior to their termination.

Warrants - post balance sheet events

By a Resolution of the Board dated 29 October 2007 the Company executed a
Warrant Instrument constituting the Warrants to subscribe for Ordinary Shares at
the Placing Price of £0.02 and granted the following Warrants to directors.

Name No. of No. of Value of
warrants Ordinary Warrants
Shares subscribed
subject
to
Warrants
T M Hearley 750,000 750,000 £15,000
J E Green 2,500,000 2,500,000 £50,000
N G McGowan 750,000 750,000 £15,000
J Weir 1,125,000 1,125,000 £22,500
A Taralle 1,125,000 1,125,000 £22,500

The principal terms of the Warrants are as follows :

(a) the exercise price is £0.02 subject to adjustment in certain limited
circumstances as detailed in paragraph (d) below:

(b) upon exercise of each Warrant, the holders of a Warrant shall be entitled
to subscribe for one New Ordinary Share;

(c) the warrants are exercisable from 29 October 2007 until 29 October 2012,
after which they will lapse;

(d) Upon the variations of the issued share capital of the Company, the
Company shall effect such adjustments ( if any) to the exercise price and/or the
number of Warrants as the Company's auditors shall advise to be appropriate.

Substantial shareholdings

The company has been notified of the following substantial holdings of ordinary
shares at 30 September 2007 and 18 March 2008:

At 30 September 2007 At 18 March 2008

Number of % Holding Number of Shares %
Shares Holding

DSL Client 400,000 4% 1,000,000 1%
Nominees
Limited
Fitel 600,000 6% 1,500,000 2%
Nominees
Limited
J E Green 3,907,500 39% 9,768,750 11%
(Director)
HTL 600,000 6% 1,500,000 2%
Properties
Limited
Maxiimar 871,875 9% - -
Group Ltd
Rangedetail 375,000 4% 937,500 1%
Ltd (owned
by N
McGowan, a
director)
Janette 441,143 4% 1,102,857 1%
Weir
(Director)
Bank of New 5,000,000 6%
York
(Nominees)
Pershing 10,000,000 12%
Keen
Nominees
Ltd
(PSL981)
Pershing 7,500,000 9%
Keen
Nominees
Ltd (GWCLT)
SVS 10,495,000 12%
(Nominees)
Ltd
PW Spungin 5,000,000 6%
Giltspur 7,350,000 9%
Nominees
Ltd
Euroclear 8,712,500 10%
Nominees
Ltd

Auditors

The auditors, RSM Bentley Jennison, will be proposed for re-appointment in
accordance with section 385 of the Companies Act 1985.

Approved by the Board on 31 March 2008 and signed on its behalf by:
.........................................

J E Green

Director

Independent Auditors' Report to the Members of IQ Holdings Plc

We have audited the group and parent company financial statements (the
"financial statements") of IQ Holdings Plc for the year ended 30 September 2007
set out on pages 10 to 27. These financial statements have been prepared in
accordance with the accounting policies set out therein.

This report is made solely to the company's members, as a body, in accordance
with Section 235 of the Companies Act 1985. Our work has been undertaken so that
we might state to the company's members those matters we are required to state
to them in an auditors' 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 company and the company's members as a body, for our audit work, for this
report, or for the opinions we have formed.

Respective responsibilities of directors and auditors

As described in the statement of Directors' responsibilities on page 3, the
company's directors are responsible for the preparation of financial statements
in accordance with applicable law and United Kingdom Accounting Standards
(United Kingdom Generally Accepted Accounting Practice). Our responsibility is
to audit the financial statements in accordance with relevant legal and
regulatory requirements and International Standards on Auditing (UK and
Ireland).

We report to you our opinion as to whether the financial statements give a true
and fair view and are properly prepared in accordance with the Companies Act
1985. We also report to you whether in our opinion the information given in the
Directors' Report is consistent with the financial statements. In addition we
report to you if, in our opinion, the group has not kept proper accounting
records, if we have not received all the information and explanations we require
for our audit, or if information specified by law regarding directors'
remuneration and transactions with the company and other members of the group is
not disclosed.

We read the Directors' Report and consider the implications for our report if we
become aware of any apparent misstatements within it.

Basis of audit opinion

We conducted our audit in accordance with International Standards on Auditing
(UK and Ireland) issued by the Auditing Practices Board. An audit includes an
examination, on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements. It also includes an assessment of the
significant estimates and judgements made by the directors in the preparation of
the financial statements, and of whether the accounting policies are appropriate
to the group's and company's circumstances, consistently applied and adequately
disclosed.

We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.

Opinion

In our opinion:
- the financial statements give a true and fair view, in accordance with United
Kingdom Generally Accepted Accounting Practice, of the state of the group's
and the parent company's affairs as at 30 September 2007 and of the group's
loss for the year then ended;
- the financial statements have been properly prepared in accordance with the
Companies Act 1985; and
- the information given in the Directors' Report is consistent with the
financial statements.

Emphasis of matter

Without qualifying our opinion, we draw attention to Note 1 in the financial
statements which indicates that the Company incurred a net loss of £180,676
during the year ended 30 September 2007 and, as of that date, the Company's
total liabilities exceeded its total assets by £185,078. These conditions, along
with other matters explained in Note 1 to the financial statements and in the
Chairman's Report on page 2, indicate the existence of a material uncertainty
which may cast significant doubt about the Company's ability to continue as a
going concern. The financial statements do not include the adjustments that
would result if the Company was unable to continue as a going concern.

RSM Bentley Jennison
Chartered Accountants & Registered Auditors Charterhouse
31 March 2008 Legge Street
Birmingham
B4 7EU

IQ Holdings Plc

Consolidated Profit and Loss Account for the Year Ended 30 September 2007

Note 2007 2006

£ £
Turnover 417,701 347,200
Cost of sales (105,505) (93,376)
Gross profit 312,196 253,824
Administrative expenses (489,999) (433,338)
Operating loss 2 (177,803) (179,514)
Interest receivable and similar income 754 62
Interest payable and similar charges 5 (3,627) (9,050)
Loss on ordinary activities before taxation (180,676) (188,502)
Loss for the financial year 16 (180,676) (188,502)

Loss per ordinary share

Basic 1.9p 3.0p

Diluted 1.9p 3.0p

Turnover and operating loss derive wholly from continuing operations.
The group has no recognised gains or losses for the year other than the results
above.

IQ Holdings Plc

Consolidated Balance Sheet as at 30 September 2007

2007 2006
Note £ £ £ £
Fixed assets
Intangible assets 8 78,347 97,934
Tangible assets 9 - 1,156
78,347 99,090
Current assets
Debtors 11 301,028 109,078
Cash at bank and in 6,350 9,034
hand
307,378 118,112
Creditors: Amounts 12 (552,416) (337,450)
falling due within one
year
Net current liabilities (245,038) (219,338)
Total assets less (166,691) (120,248)
current liabilities
Creditors: Amounts 13 (18,387) (65,104)
falling due after more
than one year
Net liabilities (185,078) (185,352)
Capital and reserves
Called up share capital 15 99,427 63,237
Share premium reserve 16 194,093 49,333
Profit and loss account 16 (478,598) (297,922)
Equity shareholders' 17 (185,078) (185,352)
deficit

Approved by the Board on 31 March 2008 and signed on its behalf by:
.........................................

J E Green

Director

IQ Holdings Plc

Company Balance Sheet as at 30 September 2007

2007 2006
Note £ £ £ £
Fixed assets
Investments 10 50,000 50,000
Current assets
Debtors 11 135,465 58,734
Cash at bank and - 200
in hand
135,465 58,934
Creditors: 12 (47,200) (46,366)
Amounts falling
due within one
year
Net current 88,265 12,568
assets
Total assets less 138,265 62,568
current
liabilities
Creditors: 13 - (30,000)
Amounts falling
due after more
than one year
Net assets 138,265 32,568
Capital and reserves
Called up share 15 99,427 63,237
capital
Share premium 16 194,093 49,333
reserve
Profit and loss 16 (155,255) (80,002)
account
Equity 17 138,265 32,568
shareholders'
funds

Approved by the Board on 31 March 2008 and signed on its behalf by:
.........................................

J E Green

Director

IQ Holdings Plc

Consolidated Cash Flow Statement for the Year Ended 30 September 2007
2007 2006
Note £ £ £ £
Net cash flow from operating 18 (30,320) (19,164)
activities
Returns on investment and 19 (2,873) (8,988)
servicing of finance
Cash outflow before management (33,193) (28,152)
of liquid resources and
financing
Financing
Repayment of loans and (57,018) (15,219)
borrowings
Issue of equity shares 84,750 40,000
Expenses paid in connection - (3,577)
with share issues
27,732 21,204
Net cash flow (5,461) (6,948)

Reconciliation of net cash flow to movement in net debt
2007 2006
Note £ £
Decrease in cash in the year 20 (5,461) (6,948)
Cash outflow from decrease in debt and lease financing 57,018 15,218
Change in net debt resulting from cash flows 51,557 8,270
Net debt at the start of the year 20 (105,707) (113,977)
Net debt at the end of the year 20 (54,150) (105,707)

IQ Holdings Plc

Notes to the Financial Statements for the Year Ended 30 September 2007

1. Accounting policies

Basis of preparation

The consolidated financial statements have been prepared under the
historical cost convention and in accordance with applicable accounting
standards.

The consolidated financial statements include the financial statements of
the company and its subsidiary undertakings made up to 30 September 2007. The
acquisition method of accounting has been adopted. Under this method, the
results of the subsidiary undertakings acquired or disposed of in the year are
included in the consolidated profit and loss account from the date of
acquisition or up to the date of disposal.

Under section 230(4) of the Companies Act 1985 the company is exempt from
the requirement to present its own profit and loss account. Its loss for the
financial year was £75,253 (2006 - £44,151).

Going concern

The financial statements have been prepared on a going concern basis not
withstanding net liabilities of £185,078 and a Loss for the financial year of
£180,676. As noted in Note 21 on page 26 and in the Chairman's Report on page 2,
since the year end the company has raised additional funds and acquired Rosslyn
Research Limited. However, the directors acknowledge that the validity of the
going concern basis remains dependent on the achievement of the subsidiary
companies' trading forecasts prepared by the directors and the ability of the
company to raise additional funding to meet its cash flow requirements should
these forecasts not be achieved. This should enable the Company to continue in
operational existence for the foreseeable future by meeting its liabilities as
they fall due for payment.

Based on this understanding, the directors believe that it remains appropriate
to prepare the financial statements on a going concern basis. The financial
statements do not include any adjustments, particularly as the regards the
carrying value of goodwill, which would result from the basis of preparation
being inappropriate.

Turnover

Turnover represents revenue earned under contracts to provide
professional services. Revenue is recognised as earned when, and to the extent
that, the firm obtains the right to consideration in exchange for its
performance under these contracts. It is measured at the fair value of the right
to consideration, which represents amounts chargeable to clients, including
expenses and disbursements but excluding VAT.

Revenue is generally recognised as contract activity progresses so that for
incomplete contracts it reflects the partial performance of the contractual
obligations by reference to the value of work performed. Revenue not billed to
clients is included in debtors and invoices on account in excess of the relevant
amount of revenue are included in deferred income.

Depreciation

Depreciation is provided on tangible fixed assets so as to write off the
cost, less any estimated residual value, over their expected useful economic
life as follows:

Office equipment 20% reducing balance

Goodwill

Goodwill is the difference between the fair value of consideration
paid for an acquired entity and the aggregate of the fair value of that entity's
identifiable assets and liabilities.

Positive goodwill is capitalised, classified as an asset on the
balance sheet and amortised on a straight line basis over its useful economic
life. It is reviewed for impairment at the end of the first full financial year
following the acquisition and in other periods if events or changes in
circumstances indicate that the carrying value may not be recoverable.

Amortisation

Amortisation is provided on intangible fixed assets so as to write
off the cost or valuation, less any estimated residual value, over their
expected useful economic life.

Goodwill was previously amortised on a straight line basis over its
expected life of 20 years.

The directors have reviewed the expected remaining useful economic life of
goodwill. As a result of this review, goodwill is now being amortised over a
five year period, starting 1 October 2006 to an estimate its residual value. The
effect of this change on the amortisation charge for the year is disclosed in
Note 8.

Deferred taxation

Deferred tax is provided in full on timing differences which
represent a liability at the balance sheet date, at rates expected to apply when
they crystallise based on current tax rates and law. Timing differences arise
from the inclusion of items of income or expenditure in tax computations in
periods different from those in which they are included in the financial
statements. Deferred tax assets and liabilities are not discounted.

Operating leases

Rentals payable under operating leases are charged in the profit
and loss account on a straight line basis over the lease term.

Share Based Payments

The Group has applied the requirements of FRS 20 Share Based
Payments. The Group issues equity-settled share based payments to directors.
Equity settled share based payments are measured at fair value (excluding the
effect of non market based vesting conditions) at the date of grant. The fair
value determined at the grant date of the equity settled share based payments is
expensed on a straight-line basis over the vesting period, based on the Group's
estimate of shares that will eventually vest and adjusted for the market-based
vesting conditions.

There has been no charge to the profit and loss account for the period as
disclosed in the Directors' report.

Classification of financial instruments issued by the Company

Following the adoption of FRS 25, financial instruments issued by
the Company are treated as equity (i.e. forming part of shareholders' funds)
only to the extent that they include no contractual obligations upon the Company
to deliver cash or financial assets or to exchange financial liabilities with
another party under conditions that are potentially unfavourable to the Company.

2 Operating loss

Operating loss is stated after charging:

2007 2006
£ £ £ £
Hire of plant and machinery (Operating Leases) 4,353 -

Auditors' remuneration
The audit of the company's annual accounts 6,500 6,000
The audit of the company's subsidiaries' annual 7,500 4,000
accounts
Other services 1,250 2,000

15,250 12,000

Depreciation of owned tangible fixed assets 1,156 1,800
Amortisation of goodwill 19,587 5,342

3 Particulars of employees

The average number of persons employed by the group (including
directors) during the year was as follows:

2007 2006

No. No.
Employees 4 4

The aggregate payroll costs of these persons were as follows:

2007 2006

£ £
Wages and salaries 280,572 269,277
Social security 24,474 29,684
305,046 298,961

4 Directors' emoluments

The directors' emoluments for the year are as follows:

2007 2006

£ £
Directors' emoluments (including benefits in kind) 247,959 216,875

The aggregate of emoluments and amounts receivable under long term
incentive schemes of the highest paid director was £118,680 (2006 - £117,800).

£14,584 (2006: £12,500) was paid to Rangedetail Limited for making
available the services of N McGowan as a director of the group and is included
in the figures above.

£7,500 (2006: £7,500 ) was paid to Vail Corporation Limited for making available
the services of T M Hearley, as a director of the group and is included in the
figures above.

5 Interest payable and similar charges

2007 2006

£ £
Bank interest payable 3,427 5,642
Loan interest 200 3,408
3,627 9,050

6 Taxation

Analysis of current period tax credit

2007 2006

£ £
Total tax on loss on ordinary activities - -

Factors affecting current period tax credit

The tax assessed on the loss on ordinary activities for the year is
higher than (2006 - higher than) the standard rate of corporation tax in the UK
of 30.00% (2006 - 30.00%).

The differences are reconciled below:

2007 2006

£ £
Loss on ordinary activities before taxation (180,676) (188,502)
Standard rate corporation tax credit (54,203) (56,551)
Expenses not deductible for tax purposes (including goods) 8,000 1,604
Losses carried forward 46,203 54,947

Total current tax for the year - -

Factors which may affect future tax charges

The company has tax losses of approximately £450,000 available to
carry forward against future trading profits.

A deferred tax asset has not been recognised in respect of these losses due to
uncertainty over the timing of when these losses will be utilised.

7 Loss per share

Basic

The calculation of the loss per share is based on the loss for the year after
taxation of £180,676 (2006: £188,502) and on 9,420,000 (2006: 6,323,705)
ordinary shares, being the time-weighted average number of shares in issue
during the year.

Diluted

There are no share options that have a dilutive effect this year or last year.

8 Intangible fixed assets

Group

Goodwill

£
Cost
As at 1 October 2006 and 30 September 2007 106,837
Amortisation
As at 1 October 2006 8,903
Charge for the year 19,587
As at 30 September 2007 28,490
Net book value
As at 30 September 2007 78,347
As at 30 September 2006 97,934

As explained in Note 1, the amortisation period of goodwill was
reviewed with effect from 1 October 2006. As a result of this change, the
amortisation charge for the year is £13,487 higher than if it had been
calculated at the previous rate.

9 Tangible fixed assets

Group

Office
equipment

£
Cost
As at 1 October 2006 and 30 September 2007 10,346
Depreciation
As at 1 October 2006 9,190
Charge for the year 1,156
As at 30 September 2007 10,346
Net book value
As at 30 September 2007 -
As at 30 September 2006 1,156

10 Fixed asset investments

Company

Group
shares

£
Cost
As at 1 October 2006 and 30 September 2007 50,000
Net book value
As at 30 September 2007 50,000
As at 30 September 2006 50,000

The company holds more than 20% of the share capital of the
following company:

Country of Principal Class % Year end
incorporation activity
Subsidiary undertakings
IQ Research England Providers Ordinary 100 30
Limited of market September
research 2007
and
business
information

Capital & Profit/(loss)
reserves for the year

£ £
Subsidiary undertakings
IQ Research Limited (351,217) (71,930)

Investments in subsidiary undertakings comprise the entire issued
ordinary share capital of IQ Research Limited. The principal activity of IQ
Research Limited is provider of market research and business information.

11 Debtors

Group Company
2007 2006 2007 2006

£ £ £ £
Trade debtors 218,016 92,374 - -
Amounts owed by group undertakings - - 39,207 29,714
Other debtors - - 14,946 14,946
Prepayments and accrued income 83,012 16,704 81,312 14,074
301,028 109,078 135,465 58,734

12 Creditors: Amounts falling due within one year

Group Company
2007 2006 2007 2006

£ £ £ £
Convertible debenture loans (unsecured) 14,342 - 14,342 -
Bank loans and overdrafts 19,494 29,637 12 -
Other loans (unsecured) 8,277 20,000 8,277 20,000
Trade creditors 144,172 58,522 - -
Social security and other taxes 233,741 143,159 - -
Other creditors 9,661 17,299 6,269 -
Director current accounts 10,539 10,000 - -
Accruals and deferred income 112,190 58,833 18,300 26,366
552,416 337,450 47,200 46,366

13 Creditors: Amounts falling due after more than one year

Group Company
2007 2006 2007 2006

£ £ £ £
Bank loans and overdrafts 18,387 35,104 - -
Convertible debentures (unsecured) due between - 30,000 - 30,000
two and five years
18,387 65,104 - 30,000

14 Maturity of borrowings

Group

Amounts repayable:

Convertible Bank loans & Other loans Total
debentures overdrafts
£ £
£ £
As at 30 September 2007
In one year or less on demand 14,342 19,494 8,277 42,113
Between one and two years - 16,717 - 16,717
Between two and five years - 1,670 - 1,670

14,342 37,881 8,277 60,500

As at 30 September 2006
In one year or less on demand - 29,637 20,000 49,637
Between one and two years - 16,717 - 16,717
Between two and five years 30,000 18,387 - 48,387

30,000 64,741 20,000 114,741

Company

Amounts repayable:

Convertible Bank loans & Other loans Total
debentures overdrafts
£ £
£ £
As at 30 September 2007
In one year or less on demand 14,342 12 8,277 22,631

14,342 12 8,277 22,631

As at 30 September 2006
In one year or less on demand - - 20,000 20,000
Between two and five years 30,000 - - 30,000

30,000 - 20,000 50,000

The convertible loan of £14,342 is for a term of up to 3 years from
15 February 2005. Allied to this is an option in favour of the holder to convert
all or part of this loan into new ordinary shares of 1p each in the company at
the price of 8p per share, provided that the conversion would be in multiples of
£5,000. Interest is payable on this loan at the rate of 6% per annum up to and
including the date of the Conversion Notice (but shall cease to accrue
thereafter on the amount of the loan).

The bank loans and overdrafts are secured by debentures dated 13 May 2004 in
favour of National Westminster Bank plc.

15 Share capital

2007 2006

£ £
Authorised
Equity
15,000,000 Ordinary shares of 1 pence each 150,000 150,000
Allotted, called up and fully paid
Equity
9,942,705 (2006 - 6,323,705) Ordinary shares of 1 pence each 99,427 63,237

During the year, the company issued the following shares;

Shares Share price Consideration
allotted

£

8 November 2006 1,924,000 5 p 96,200
8 November 2006 1,095,000 5 p 54,750
29 January 2007 600,000 5 p 30,000
3,619,000 180,950

16 Reserves

Group

Share Profit and Total
premium loss account
reserve £
£
£
Balance at 1 October 2006 49,333 (297,922) (248,589)
Premium on issue of shares 144,760 - 144,760
Transfer from profit and loss account - (180,676) (180,676)
for the year
Balance at 30 September 2007 194,093 (478,598) (284,505)

Company

Share Profit and Total
premium loss account
reserve £
£
£
Balance at 1 October 2006 49,333 (80,002) (30,669)
Premium on issue of shares 144,760 - 144,760
Transfer from profit and loss account - (75,253) (75,253)
for the year
Balance at 30 September 2007 194,093 (155,255) 38,838

17 Reconciliation of movements in shareholders' funds

Group Company
2007 2006 2007 2006

£ £ £ £
Loss attributable to (180,676) (188,502) (75,253) (44,151)
members of the group /
company
New share capital 180,950 41,424 180,950 41,423
subscribed
Net addition/(reduction) 274 (147,078) 105,697 (2,728)
to shareholders' funds
Opening equity (185,352) (38,272) 32,568 35,296
shareholders' funds
Closing equity (185,078) (185,352) 138,265 32,568
shareholders' funds

18 Reconciliation of operating loss to operating cash flows

2007 2006
£ £
Operating loss (177,803) (179,514)
Depreciation, amortisation and impairment charges 20,743 7,142
Loss on disposal of fixed assets - 5,000
Decrease in stocks - 9,875
Increase in debtors (191,950) (3,177)
Increase in creditors 318,690 141,510
Net cash outflow from operating activities (30,320) (19,164)

19 Analysis of cash flows

2007 2006
£ £
Returns on investment and servicing of finance
Other interest paid (3,627) (9,050)
Interest received 754 62
(2,873) (8,988)

20 Analysis of net debt

At start of Cash flow At end of
period period
£
£ £
Cash at bank and in hand 9,034 (2,684) 6,350
Bank overdraft - (2,777) (2,777)
Cash and bank net debt 9,034 (5,461) 3,573

Debt due within one year (49,637) 10,301 (39,336)
Debt due after one year (65,104) 46,717 (18,387)
Change in debt (114,741) 57,018 (57,723)

Net debt (105,707) 51,557 (54,150)

21 Post balance sheet events

On 28 November 2007 the Company commenced trading on the AIM market of the
London Stock Exchange. On the same date the Company raised gross proceeds of
£850,000 and completed the acquisition of Rosslyn Research Limited.

Financial Assets and Liabilities

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 main risks arising from the Group's financial instruments are interest risk
and liquidity risk. The directors review and agree policies for managing these
risks and these are summarised below.

Short term debtors and creditors have been excluded from all the following
disclosures.

Interest rate risk

The Group finances its operations through share capital and loans, and has a
bank borrowing facility. Interest receivable and payable is accrued and credited
/charged to the profit and loss account in the period to which it relates.

Liquidity risk

The Group seeks to manage financial risk to ensure sufficient liquidity is
available to meet foreseeable needs.

Fair Value

The fair values of the Group's financial instruments are considered equal to the
book value.

22 Related parties

Controlling entity

The company has been controlled throughout the current period by its directors,
by virtue of them holding a majority of the issued ordinary shares of the
company.

Related party transactions

Included in 'Cash at bank and in hand' at 30 September 2007 is £6,362 (2006 -
£4,097) held in a client account on behalf of IQ Research Limited by List basis
Limited (trading as 'C F Consultants'), a company of which J C Green, a director
and controlling shareholder of the company secretary (C F Secretaries Limited),
is a director and controlling shareholder. At 30 September 2007 included in
'Trade Creditors' is £15,430 due to CF Consultants.

The 'Other loans' due within one year of £8,277 includes a loan of £Nil (2006 -
£10,000) from the Trustees of the Estate of Mrs C E Major deceased, of which J C
Green, a director and controlling shareholder of the company secretary (C F
Secretaries Limited), is a trustee, and a loan of £8,277 (2006 - £10,000) from
Maxiimar International Limited, a company of which R A Martin, a director of IQ
Holdings PLC, is a director and controlling shareholder. Interest is payable at
8% on these loans and the loans are repayable at 3 months notice.

Included in 'Trade creditors' is £7,500 (2006 - £6,662) due to Maxiimar
International Limited. During the year the group was charged fees of £7,500 by
Maxiimar International Limited, a company of which R A Martin, a director of IQ
Holdings PLC, is a director and controlling shareholder.

Included in 'Creditors' is £10,539 (2006 - £10,000) due to J E Green, a director
of IQ Holdings Plc. This relates to a loan made during the year by J E Green to
IQ Research Limited. There is no fixed repayment date and the loan is interest
free.

During the year, the group was charged fees of £Nil ( 2006: £32) by Binns & Co
PR Limited, and included in 'Trade creditors' is £1,658 (2006 - £1,658) due to
Binns & Co PR Limited, a company of which T M Hearley, a director of IQ Holdings
PLC, is a director and controlling shareholder.

During the year, the group was charged fees of £6,250 (2006: £7,500) by Vail
Corporation Limited, and included in 'Trade creditors' is £4,675 (2006 - £8,813)
due to Vail Corporation Limited, a company of which T M Hearley, a director of
IQ Holdings PLC, is a director and controlling shareholder.

During the year, the group was charged fees of £14,584 (2006: £12,500) by
Rangedetail Limited, and included in 'Trade creditors' is £12,500 (2006 -
£7,762) due to Rangedetail Limited, a company of which N G McGowan, a director
of IQ Holdings PLC, is a director and controlling shareholder.

Director's loan account

The following balance owed to the director was outstanding at the year end:

Maximum 2007 2006
Balance
£ £ £
Julian Green 10,539 10,539 10,000

This information is provided by RNS
The company news service from the London Stock Exchange
END

FR UARORWRROOAR