European Wealth is a trading style of European Investment Management Limited (registered 
number 06931664) which is incorporated and registered in England and Wales with registered 
office at Ellenborough House, Wellington Street, Cheltenham, Gloucestershire GL50 1YD 
and authorised and regulated by the Financial Conduct Authority. This document is not 
to be construed as a solicitation or offer to buy or sell securities and does not in any way 
constitute investment advice, nor should it be used as the basis for any investment decision. 
The information contained in this document has been prepared using all reasonable care. 
However, it is not guaranteed as to its accuracy, and it is published solely for information 
purposes. Our opinions are subject to change without notice and we are not under any 
obligation to update or keep this information current. The investments discussed in this 
document may not be suitable for all investors. European Wealth does not guarantee the 
performance of any investments. Past performance is not necessarily a guide to future 
performance. The value of investments may go up or down and you may not get back the 
amount you have invested. The income from an investment is not fixed and may fluctuate. 
The value of an investment involving exposure to foreign currencies can be affected by 
exchange rate movements which may cause the value of the investment to go up or down. 
European Wealth and/or its affiliated companies and/or their employees may, from time to 
time, hold shares or holdings in the securities discussed in this message and may as agent 
buy or sell those securities. This document is not, and under no circumstances is to be 
construed as, an advertisement, or any other step in furtherance of a public offering of shares 
in the United States or Canada. This document is not aimed at persons who are resident in 
the United States, Canada or any province or territory thereof.
EUROPEAN WEALTH
10-11 Austin Friars 
London EC2N 2HG
Telephone 020 7293 0730
www.europeanwealth.com
EUROPEAN  
WEALTH GROUP 
LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2016
REGISTERED NUMBER: 42316
Protect and grow your wealth  01 SECTION HEADING
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
Auditor 
Moore Stephens LLP 
Chartered Accountants and Statutory Auditor 
150 Aldersgate Street 
London 
EC1A 4AB
Nominated Adviser and Broker 
finnCap 
60 New Broad Street 
London 
EC2M 1JJ
Registrars 
Capita Asset Services 
40 Dukes Place 
London 
EC3A 7NH
Company’s Registered Office 
Regency Court 
Glategny Esplanade 
St Peter Port 
Guernsey 
GY1 1WW
Company’s Registered Number 
42316
ADVISERS AND
COMPANY INFORMA TION 02 SECTION HEADING
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016 03 SECTION HEADING
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
CONTENTS 
Highlights and Summary Information ................................................................................................ 4
Chairman’s Statement ........................................................................................................................ 6
Group Chief Executive’s Report ......................................................................................................... 8
Strategic Report ............................................................................................................................... 12
The Board ......................................................................................................................................... 15
Directors’ Report .............................................................................................................................. 16
Corporate Governance .................................................................................................................... 19
Directors’ Remuneration Report ...................................................................................................... 25
Directors’ Responsibilities Statement .............................................................................................. 26
Independent Auditor’s Report ......................................................................................................... 27
Consolidated Statement of Comprehensive Income ...................................................................... 29
Consolidated Statement of Financial Position ................................................................................ 30
Company Statement of Financial Position ...................................................................................... 31
Consolidated Statement of Changes in Equity ............................................................................... 32
Company Statement of Changes in Equity ..................................................................................... 33
Consolidated and Company Cash Flow Statement ........................................................................ 34
Notes to the Financial Statements .................................................................................................. 35 04 HIGHLIGHTS AND SUMMARY INFORMATION
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
HIGHLIGHTS  
AND SUMMARY INFORMA TION
Operational Highlights
•  Assets under management increased by 25% to 
£1.5bn (2015: £1.2bn)
• Three acquisitions were successfully completed in the 
financial year under review:
  –  In January 2016, the Group acquired the 
financial planning client list from Phoenix Invest 
Limited which added £20m of funds under 
influence, integrated into European Financial 
Planning
  –  In September 2016, the Group completed the 
acquisition of CIMCO Partners Management 
Limited, changing the name to European 
Wealth Gibraltar Limited, which manages the 
G20 Absolute Return fund. This acquisition 
added US$22m of funds under management
  –  In October 2016, the Group acquired a book 
of business and certain related assets from 
Towry Asset Management, which will bring an 
estimated £80m-£100m of additional funds 
under management to the Group
• Growth in overseas operations with the addition of a 
Gibraltar office, and a foothold into the South African 
market through the 2016 acquisitions
Financial Highlights
•  Income from trading activities increased by 23% 
to £9.4m (2015: £7.7m) due to organic growth and 
growth from acquisitions
•  Group recurring revenue increased to £5.3m (2015: 
£4.8m)
•  Financial Planning recurring revenue increased to 79% 
(2015: 72%)
•  Strong growth of Treasury and Cash Management 
mandate which now accounts for 14% of the 
investment management division’s revenue (2015: 
13%)
•  Loss before tax decreased to £0.8m (2015: £1m) 
resulting in the firm recording a positive EBITDA of 
£346,000 (2015: loss of £68,000)
• Net assets increased to £17.8m (2014: £17.3m) 05 HIGHLIGHTS AND SUMMARY INFORMATION
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
Summary Information
European Wealth Group Limited and its subsidiaries 
(the “Group”) is a growing and established wealth 
management business, which was founded in 2009 and 
commenced trading in 2010. Its principal services are 
financial planning and investment management in both 
equity and fixed interest instruments. 
The client base currently ranges from individuals with 
up to £21.8m of assets to invest to institutions investing 
up to £89m. The Group currently has over £1.5bn of 
funds under management or influence (“FUM”) and has 
headquarters in London and regional offices in Brighton, 
Cheltenham, East Malling, Manchester, Wokingham, 
Worcester and overseas offices in Zurich, Switzerland and 
Gibraltar. European Wealth and its subsidiaries currently 
have 79 employees as well as using the services of 13 
consultants.
The Group’s structure is split into two business divisions: 
investment management and financial planning.
Under the investment management division the 
four trading subsidiaries are European Investment 
Management Limited (“EIM”), European Wealth Trading 
Limited (“EWT”), European Wealth (Switzerland) SA 
(“EW Switzerland”) and European Wealth Gibraltar (“EW 
Gibraltar”).
EIM is the investment management arm of the Group 
providing institutional style investment management for 
private clients, trusts, pension funds, universities and 
charities. It also manages money on behalf of third party 
independent financial advisers. As at the year end EIM, 
EW Switzerland and EW Gibraltar had £933m of FUM split 
between its discretionary and equity investments (£458m) 
and its fixed interest investments (£475m).
EWT is a member of the London Stock Exchange and is 
the dealing arm for the Group with its main activity being 
the provision of dealing services to EIM.
The Financial Planning business is European Financial 
Planning Limited (“EFP”). EFP currently acts for over 9,813 
clients and 47 corporate pension schemes ranging in size 
from 10 to 5,000 members, with aggregate funds under 
advice of approximately £527m. The financial planning 
division provides advice to clients covering three core 
services – financial planning, corporate pension advisory 
and tax planning. 06 SECTION HEADING
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
CHAIRMAN’S
STATEMENT 07 CHAIRMAN’S STATEMENT
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
2016 was a year of considerable growth and development 
for European Wealth. Our total funds under management 
increased by 25% to £1.5bn (2015: £1.2bn) and it is pleasing to 
note that this was achieved both through organic growth and 
our ongoing strategy of selective acquisitions. Since the year 
end our funds under management have increased further to 
over £1.65bn due to new mandates won in the current year and 
as a result of funds transferring under the T owry agreement.
This increase in funds under management was mirrored in the 
turnover for the Group, which reached £9.4m for the year to 
31 December 2016, an increase of 23% over the previous year 
(2015: £7.7m). At the interim stage, we commented that we 
believed that one of the key measures of performance was an 
increasing, positive EBITDA so it is pleasing to note that the 
Group recorded a positive EBITDA of £0.3m. Growth in the top 
line coupled with our focus on cost control saw the loss before 
tax reduce from £1.0m in 2015 to £0.8m for the year to 31 
December 2016.
Strategy 
The strategy of the Group continues to be to expand through 
three key channels, organic growth, selective acquisition 
and attracting additional revenue-generating staff. I have 
already commented above on the success we had last year in 
generating both organic and acquisitive growth. However , as 
highlighted in a trading statement earlier in the year , we believe 
that the cost of acquisitions within the investment management 
and financial planning industries has increased to a point where 
we feel selective recruitment of revenue-generating staff would 
be the most effective use of the company’ s capital in the short 
term. This should not be interpreted however , as our intention 
to walk away from the pursuit of selective acquisitions where we 
see a prudent, fairly priced acquisition which adds to the overall 
Group skill set and produces economies of scale from our 
already robust administration system.
The Board
In April 2016, Rod Gentry stepped down from the Board. 
Rod was an integral part of the team that created European 
Wealth and we are all grateful for his dedication over the 
years. Following Rod’ s departure, the Board reviewed the 
management structure of the business and the performance 
of certain parts of the Group. As a result, a number of changes 
were made. The role of Executive Chairman was split, with 
John Morton taking on the role of Group Chief Executive and I 
became Non-Executive Chairman. Underlining the importance 
of efficient, up to date and cost effective operations within the 
whole Group, Simon Ray our Group Chief Operating Officer 
has also been appointed to the Board. 
The regulatory obligations on the Board continue to increase 
with the ‘Senior Management Regime’ due to be implemented 
at the beginning of 2018. Whilst the Board recognise the 
need for individual accountability of Directors and Senior 
Management, we believe strongly in the collective responsibility 
of the Board, and the Executive Management T eam together 
with robust challenge by Non-Executive Directors. 
A number of projects and initiatives are being undertaken within 
the regulated businesses to both ensure that the Group is not 
only fully prepared for the introduction of MiFID II but that we 
also continue to review, improve and modernise the delivery of 
our service to clients however they may interact with the Group. 
Outlook 
The global economy and stock markets have a number of 
uncertainties to confront during 2017. American interest rates 
have continued their upward trend, more rises are expected in 
the current year and this trend will possibly spread over to other 
parts of the world impacting the bond markets. Meanwhile, US 
equity markets have hit record highs, driven by the economic 
promises of the new administration. Closer to home, the UK 
has to confront the challenges of Brexit and a shock UK election 
result, which are likely to cause periods of uncertainty both for 
the UK domestic economy and the stock markets in the UK and 
Continental Europe; where France has elected a new President 
and elections follow in many other European countries. It 
remains to be seen what impact all this will have on global stock 
markets that performed particularly well in the fourth quarter of 
2016 and have started the current year with optimism. 
Irrespective of these uncertainties, European Wealth is now 
well placed to continue its strategy for growth. The Group has 
secured £9.3m of new capital, which will fund the redemption 
of the bridging finance put in place on 7 June to facilitate the 
repayment of the convertible loan stock, repay other loans and 
leave the Group debt free. With a much-strengthened balance 
sheet, your Board now looks forward to taking advantage of the 
right opportunities when they emerge over the next year . 
Y our Board has always considered the culture of European 
Wealth to be one of the Group’ s main assets and something 
that we are committed to developing further as the Group 
grows. The correct culture within the Group will not only 
help the employees within the business, it will also result in a 
superior service to clients and, ultimately , greater rewards to 
shareholders. Within times of significant change in any industry, 
the more internal stability that can be provided to employees, 
the greater the chance of reducing staff turnover and of building 
loyalty amongst our staff and our client base. 
In closing, I would like to express my own thanks and those of 
all the members of the Board to our clients, shareholders and 
staff for their strong support for the Group.
Buzz West, Chairman 
June 2017 08 SECTION HEADING
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
GROUP CHIEF 
EXECUTIVE’S REPORT 09 GROUP CHIEF EXECUTIVE’S REPORT
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
Despite a lacklustre start to 2016, global stock markets 
performed well over the year with the FTSE All Share Index 
increasing by 12.8% and the FTSE World Index increasing by 
26.2%. This was despite some significant turmoil in the political 
landscape during the second half of the year . Not only did 
stock markets have to weather the uncertainty surrounding 
the election of the President of the United States and its 
unexpected result, but also the somewhat surprise decision 
by the UK Electorate to vote in favour of Brexit. The political 
fallout of the latter initially caused a significant fall in the 
currency . Sterling weakness however , had a positive impact on 
the UK stock market which has such a strong representation 
of companies with high proportions of overseas earnings. The 
UK market was also underpinned by good economic growth 
figures compared to many other major economies particularly 
those in Continental Europe. 
Against this background, I am pleased to report that European 
Wealth has had a successful year pursuing its strategy of 
growth through classic organic growth, selective acquisitions 
of businesses and the addition of revenue-generating staff. As 
noted in the Chairman’ s Statement, funds under management 
have increased by 25% to £1.5bn. During the last 12 months, 
the two largest acquisitions were the T owry book of business 
which was mainly comprised of South African clients and 
CIMCO, the managers of a Gibraltar-based Absolute Return 
Fund, which has added approximately US$22m to the 
funds under management. The total amount of funds under 
management acquired during 2016 was £36m, the rest of the 
increase has been a result of organic growth. 
The financial performance of the Group over the last 12 months 
has also improved, justifying the confidence expr essed in our 
Interim Statement. These results have been boosted not only 
by revenue growth but also by further control of the cost base. 
The turnover in the investment management business has 
grown by 33% over the last 12 months, increasing to £6.1m 
(2015: £4.5m) primarily driven by increases in the revenue 
generated from discretionary portfolio management and the 
continued strong growth in our treasury and cash management 
services. The financial planning business was also able to record 
a 10% increase in turnover to £3.3m (2015: £3.0m); primarily 
driven by increases in income from general financial planning 
services and specialist tax planning. 
In the last two years, we have followed a deliberate policy of 
investing in our operational infrastructure which is now helping 
us control our costs and to absorb acquisitions. As we provide 
all the administration in-house, the Group’ s fixed cost base is 
understandably high, accounting for approximately 80% of the 
total operating costs. However , it does confer the advantage 
that any increase in revenue has a disproportionately positive 
impact on the profitability of the Group. 
Our total headcount continues to increase and reached 92 at 
the 31 December 2016. 
2016 2015
Number % Number %
Fee-Earning 39 42% 40 49%
Admininstration 53 58% 42 51%
Total 92 82
The numbers in the table above do not include the staff that 
have transferred over following our acquisition of the book 
of business from T owry which was announced in October 
2016. Whilst the transfer is taking longer than we originally 
anticipated, the staff of two investment managers and an 
assistant joined European Wealth at the end of February and 
the speed of client transfer is accelerating. It is your Board’ s 
intention to build a presence in South Africa to attract further 
funds under management both from local introducers and 
private individuals. 
The increase in the ratio of administration staff to fee-earners 
has been the result of a r estructuring within the financial 
planning business. A team of para planners, which we have 
included in administration staff, have been put in place to 
support the financial advisers. We expect this to have a positive 
effect on the amount of revenue that can be generated by each 
financial planner. 
One of the features of 2016 has been the increase in levels 
of organic growth. This will be further enhanced by the 
establishment of a dedicated business development function 
which will concentrate both on the cross-selling that can be 
achieved within the Group but also developing our range of 
external introducers both in the UK and overseas. 
Review of Divisions
European Wealth Group has two key divisions which allow 
the Group to offer a wide range of services within the wealth 
management industry .  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
10 GROUP CHIEF EXECUTIVE’S REPORT
Investment Management 
The investment management division is made up of three core 
disciplines, discretionary portfolio management, treasury and 
cash management and a specialist execution-only dealing desk. 
Revenue from each division breaks down as follows: 
Discipline
2016 2015
£’000 % £’000 %
Discretionary 4,559 75% 3,473 77%
Treasury and Cash 
Management
864 14% 579 13%
Execution-only 661 11% 483 10%
 6,084 4,535
The discretionary portfolio management discipline has always 
been the backbone of the division providing discretionary and 
advisory multi-asset investment services to a broad range of 
clients. As the market becomes ever more competitive, it is 
important that European Wealth continues to offer clients a 
highly personal service and investment performance that meets 
their objectives. T o this end, it is pleasing that our investment 
performance remains strong and we continue to win industry 
awards. 
Within the investment management division, despite the low 
interest rate environment making profitable fixed interest 
investment challenging, our Fixed Interest team have, once 
again, been very successful in showing strong organic growth. 
The T eam won several new mandates, particularly in the 
university sector , increasing their funds under management 
from £345m at the end of 2015 to £475m at the end of 2016. 
Furthermore, I am pleased to report that the success has 
continued into 2017 and in the opening months of 2017, they 
have been awarded mandates over a further £200m together 
with some of the existing clients adding additional funds to 
their portfolios. The T reasury and Cash management team will 
continue to be in demand as the quest for low risk assets but 
with some positive return, continues. 
The earnings from the Dealing Desk will always be volatile and 
driven by trading activity in the stock markets. Nevertheless, 
your Board considers it to be a valuable source of revenue for 
the Group and an area that we expect to develop further as a 
certain segment of the client base continue to want to keep 
control of their assets and require a purely execution-only 
service. Despite margin pressure with the availability of online 
dealing services, the fact that we are clearing our own trades 
through an in-house back office facility allows us to keep our 
marginal cost as low as possible. 
Financial Planning 
The financial planning business is divided between three 
distinct disciplines, the revenue for each is as follows: 
Discipline
2016 2015
£’000 % £’000 %
General Planning 2,523 76% 2,227 72%
Group Pensions 558 17% 615 20%
Specialist Tax 
Planning
247 7% 249 8%
 3,328 3,091
We stated at the interim stage that we were introducing new 
procedures in our financial planning business and also were in 
the process of fully integrating the ISM and Bells acquisitions. 
The changes to the client charging structure which I referred 
to in my Chairman’ s Statement last year have continued in 
2016. Consequently , the shape of the revenue has continued 
to improve with the recurring revenue now accounting for 79% 
of total revenue (2015 – 72%). The Interim Report was very 
clear on the imperative to build recurring revenue as quickly as 
possible to provide the cash flow to invest in the high added 
value service necessary to grow the business and stay ahead of 
the competition.
General financial planning will always be a cornerstone of this 
business but increasingly we see growing demand for more 
specialist financial planning such as advising clients where to 
place their assets to take best advantage of current taxation 
legislation and, more importantly , to plan for retirement 
and structure their personal and family assets in the most 
appropriate way . There are good opportunities for cross-
referrals both within the financial planning business and the 
wider Group. 
The Balance Sheet
Since its inception, the Group has been, in part, funded by 
debt. At its admission to AIM in May 2014, much of that debt 
was consolidated in a convertible loan stock. Contemporaneous 
with these results, European Wealth has agreed terms to raise 
£9.3m of new capital. Not only will this provide the funds to 
redeem the bridge finance entered into on 7 June and all 
accrued interest thereon, it is also sufficient to enable the Group 
to repay other loans and satisfy all deferred consideration 
liabilities, leaving the Group debt free.
With the Group now firmly cash flow positive, and a 
strengthened balance sheet, European Wealth is better placed 
to face the future than at any time in its recent history .  11 GROUP CHIEF EXECUTIVE’S REPORT
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
Outlook 
The outlook for world economies and, consequently , stock 
markets would appear to be subject to more political 
influences than usual. Following the close election in the US, 
the complexities of Brexit, the recent elections in the UK and 
France, together with the election in Germany , which have and 
will continue to command the attention of politicians and the 
media, there is ample reason to believe there will be spells of 
volatility in stock markets. 
However , there is cause for some optimism. Except for a very 
small number of small emerging economies, the outlook is for 
all developed economies to grow and forecasts are for the UK 
economy to show the best growth rate in Europe and even 
surpass that of the US. Interest rates are likely to continue to 
increase moderately in the US and are unlikely to move at all 
in Europe. The UK may be an exception here but with Brexit 
it is unlikely to be anything other than a cosmetic nod to the 
rising inflation numbers. Inflation is reasonably under control 
in the major economies although the weakness of Sterling has 
started to impact the inflation numbers in the UK. Against this 
background, we view the future for investment returns with 
some confidence although there may be some correction 
following the recent strong run in markets. 
The continued uncertainty within the wealth management 
industry together with the ongoing challenges with the 
introduction of MiFID II at the beginning of 2018, will put 
pressure on the smaller fund management and financial 
planning companies. The increase in regulation is not 
restricted to the UK; regulation is also increasing within the 
financial services industry internationally. These dynamics are 
likely to lead to more consolidation and consequently the 
opportunity for further acquisitive growth, both domestically 
and internationally . The greatest challenge at the moment is to 
ensure that acquisitions are realistically priced, something your 
Board is finding an increasing challenge. 
Acquiring individuals or teams of people can sometimes be 
better than acquiring a whole company . The consolidation 
within the industry has resulted in a higher level of turnover 
amongst senior revenue generating staff and European Wealth 
has been able to take advantage of this uncertainty . We have 
already recruited two new revenue generators in the first three 
months of 2017 and expect them to be contributing to the 
Group’ s revenue in a very short space of time.
The Board believes that the demand for impartial financial 
planning and investment management advice will grow as 
individuals become more responsible for the funding of their 
retirement at a time when life expectancy is increasing. 
In conclusion, we are looking forward to the future with confidence; 
our balance sheet has been strengthened and we are on track for 
achieving our short-term target of £2.0bn of AUM. Finally , I would 
like to add my thanks to everybody associated with European 
Wealth for their continued commitment and determination over the 
last 12 months. The Board and all the staff within the Group remain 
determined to make European Wealth a growing name within the 
wealth management industry both across the UK and overseas.
A J Morton 
Group Chief Executive EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
12 STRATEGIC REPORT
STRATEGIC  
REPORT
This strategic report has been prepared for the Group as 
a whole and therefore gives greater emphasis to those 
matters which are significant to European Wealth Group 
Limited and its subsidiary undertakings, when viewed as a 
whole.
The strategic report contains certain forward-looking 
statements. These statements are made by the Directors 
in good faith based on the information available to them 
up to the time of their approval of this report and such 
statements should be treated with caution due to the 
inherent uncertainties, including both economic and 
business risk factors, underlying any such forward-looking 
information.
Objectives and strategy 
The Group’s strategy is to become a leading provider 
of asset management and financial planning services. 
The Group intends to achieve this through its three main 
ambitions which are to grow the business by acquisition, 
organic growth and by attracting highly qualified staff. This 
strategy has resulted in the Group increasing its FUM to 
£1.5bn over the last five years.
The Directors have identified a number of themes which 
they believe will continue to be central to growing a 
successful wealth management business in a post RDR 
environment, most notably: 
1.  The need for an appropriate integration of investment 
management and financial planning disciplines to 
deliver a unified wealth management service where 
personal service is key; 
2.  The ability to respond effectively to changes in 
both the regulatory environment and industry 
developments; and 
3.  The ability to deliver profitability at times when 
operating margins come under pressure. 
The Directors believe that the increasing regulation 
and compliance requirements for small to medium-
size investment management companies and financial 
advisory firms have created significant consolidation 
opportunities. The Group has a clearly established track 
record of supplementing its organic growth with profitable 
acquisitions. The Directors believe that the Group is in a 
good position, with improved access to capital markets, to 
exploit further such consolidation opportunities.
To enable the Group to achieve this strategy it will utilise 
its key strengths, which include:
•  Genuine delivery of wealth management – financial 
planning fully integrated with investment management
•  The business is de-risked through having six separate 
unrelated revenue streams held within two business 
segments, all of which make material contributions
•  In-house administrative functions allow for acquisitions 
to be brought in with minimal additional cost
•   Structured investment process – results are transparent 
and measurable
•   Access to product – the financial planning business 
is independent under FCA regulations and the 
investment management business selects best of 
breed from the whole market
•   Strong and highly experienced management team who 
all have experience of working in growing businesses 
Results for the financial year 
During the financial year ended 31 December 2016 
the business continued growing organically as well 
as completing three new acquisitions. While the full 
benefits of these acquisitions will not be felt until 2017, 
the revenue and costs savings associate with 2015’s 
acquisitions have fed through to the consolidated 
statement of income.  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
13 STRATEGIC REPORT
European Wealth’s revenue for the year across all divisions 
was £9.4m (2015: £7.7m), which led to an EBITDA profit 
of £0.34m (2015: loss of £0.06m). This is a significant step 
towards fulfilling the vision set out on the CEO’s statement 
and is testament to the management’s drive to increased 
efficiency and greater profitability.
The loss before tax was £0.76m (2015: loss of £1.0m).
At the year end the Group’s net assets amounted 
to £17.8m (2015: £17.3m), and net current liabilities 
amounted to £8.1m (2015: net current liabilities of £3.3m). 
The increase in the net liabilities position was a result of 
the reclassification of the convertible loan stock from long 
to short term on account of the May 2017 conversion 
date.
Key performance indicators
A review of the Group’s business and an indication of 
likely future developments are contained in the Chairman 
and Group Chief Executive statements and in the Review 
of the Business. The Group’s key performance indicators 
are highlighted below. 
KPI 2014 2015 2016
AUM (£m) 995.9 1,188.8 1,459.7
Revenue (£’000) 4,647 7,653 9,412
EBITDA (£’000) 92 (68) 346
EFP recurring 
revenue
49% 72% 79%
Number of staff 69 82 92
Revenue generating 
staff
46% 49% 42%
Key risks affecting the business
There are a number of potential risks and uncertainties 
that could have an impact on the performance of the 
Group and Company. 
Whilst there are other risks identified (and approved 
by the Board in terms of their management through its 
systems and controls) in the Company’s documented risk 
management framework, the key risks include:
Operational risk
This is defined as the risk of loss arising from inadequate 
or failed internal processes, people, systems or external 
events. The Group has embedded a risk management 
framework that identifies and assesses risks in order to 
manage and mitigate them in an efficient manner. The 
management of these risks are disclosed in the corporate 
governance section of this report.
The Group in its current form is relatively young and 
has been loss making since its inception, which is a 
reflection of it building up its infrastructure to support the 
business it is today. Consequently, the business expects 
its future growth to improve its operating margins whilst 
appreciating the risk that if this growth is not delivered 
then the business strategy will need to be reviewed. 
Solvency risk
The Group and Company maintain a mixture of cash and 
cash equivalents that are designed to meet the Company’s 
operational and trading activities. Having prepared 
detailed forecasts, the Company is confident that it has 
sufficient liquidity for the foreseeable future.
The Directors understand the risk of not being able 
to meet the long term and short term obligations 
of the business, especially with regards to its capital 
requirements. In order to mitigate this risk the Group’s 
finance team analyses cashflow on a regular basis and has 
implemented strong internal controls so that all outgoings 
are budgeted for. The Company itself has robust plans 
in place that will enable it to bring in new capital and 
restructure the existing capital base if forecasted targets 
are not achieved and additional capital is required.
Dependence on key personnel 
The Group’s performance is dependent on its current and 
future management team. The loss of any of its existing 
directors or key employees or a failure to recruit additional 
directors and/or senior executives could, therefore, 
significantly reduce the Group’s ability to make successful 
acquisitions or manage the Group and its operations 
effectively. The Group manages this risk through the 
use of standard contracts with relevant restrictive 
covenants where required along with the use of its strong, 
experienced, internal HR department.
The future performance of the Group cannot be 
guaranteed 
There is no certainty and no representation or warranty is 
given by any person that the Group will be able to achieve 
any returns referred to in this document. The financial 
operations of the Group may be adversely affected by 
general economic conditions, by conditions within the 
UK financial services market generally or by the particular 
financial condition of other parties doing business with 
the Company. Historically, the performance of the assets 
has been good and is under constant review by the firms 
experienced Investment Management Committee. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
14 STRATEGIC REPORT
Prospective acquisitions may fail to deliver expected 
performance 
There can be no guarantee that suitable companies or 
businesses will be available for the Group to successfully 
identify and acquire in the future. The wealth management 
sector has a number of large businesses operating within 
it, together with many of medium size and a substantial 
number of small operations. The Company therefore will 
face competition to acquire other operations. A number 
of competitors are larger and have greater resources 
than the Company and may prevent the successful 
implementation of the Company’s business plan. The 
Group has a strong, experienced management team, 
all of whom have experience in working with growing 
acquisitive businesses, which allows for robust post 
acquisition integration plans to be implemented.
Future funding requirements 
Funding may be required in the future to implement 
the Group’s strategy. The Group may attempt to raise 
additional funds through equity or debt financings or from 
other sources to implement this strategy. Any additional 
equity financing may be dilutive to holders of Ordinary 
Shares and any debt financing, if available, may require 
restrictions to be placed on the Group’s future financing 
and operating activities. The Group may be unable to 
obtain additional financing on acceptable terms or at all if 
market and economic conditions, the financial condition 
or operating performance of the Group or investor 
sentiment (whether towards the Group in particular or 
towards the market sector in which the Group operates) 
are unfavourable. The Group’s inability to raise additional 
funding may hinder its ability to implement its strategy, 
grow in the future or to maintain its existing levels of 
operation. 
The Group’s experienced management team and Board 
have been successful in the past at raising equity and debt 
finance. There are robust plans in place to bring in new 
capital and restructure the existing capital base if required.
Regulatory risk
Regulatory risk is the risk that the regulated entities fail 
to comply with any of the regulations set by the various 
regulatory bodies that each company operates under. 
The Group is engaged in activities which are regulated 
by the Financial Conduct Authority (“FCA”) in the UK 
and the Financial Services Board(“FSB”) in South Africa. 
The Group may, therefore, be required from time to time 
to review and update its regulatory permissions and the 
status of its authorised persons to ensure that it’s existing 
and new activities, as they develop, are consistent with 
the Group’s regulatory permissions. Failure to do so could 
lead to public reprimand, the imposition of fines, the 
revocation of permissions or authorisations and/or other 
regulatory sanctions, any of which could lead to adverse 
publicity and reputational damage and could have a 
material adverse effect on the continued conduct of the 
Group’s business. There may, in the future, be changes to, 
or new laws and regulations that govern the operations 
of the Group. The Company cannot predict the full effect 
that any proposed or future law or regulation may have 
on the financial condition or results or operations of the 
Group. It is possible that the Group may be adversely 
affected by changes in the applicable laws or regulations.
Key to managing this risk is:
1.  Adopting a robust “top down” system of risk 
management headed by the Risk and Compliance 
committee which is chaired by the Company’s 
Chairman. The Committee meets in person every 
quarter and on an ad-hoc basis in between. The 
heads of risk and compliance for European Investment 
Management, European Wealth Trading and 
European Financial Planning attend all meetings of the 
Committee with senior members of the firm’s finance 
function
2.  A non-executive board of three directors bringing 
significant business expertise in the financial services 
sector and seeking to enhance an independent and 
balanced decision making process, particularly around 
regulatory matters
3.  An effective risk and compliance team handling day 
to day management of regulatory risk for the Group 
and monitoring of its business to ensure compliance 
with the rules of the Financial Reporting Council, the 
Financial Conduct Authority and of the London Stock 
Exchange.
Stock market conditions 
The Group’s business will be partially dependent on 
market conditions. Adverse market conditions may have 
a significant negative effect on the Group’s operations 
through reducing the assets under management.
Approved by the Board 
 
A J Morton 
Group Chief Executive EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
15 THE BOARD
THE  
BOARD
Kenneth Reginald Dawson (“Buzz”) West 
(Non-Executive Chairman)
Buzz is the Non Executive Chairman of European 
Wealth Group having previously been the Senior 
Non Executive Director. He also sits on the regulated 
subsidiary boards. Buzz was co-founder and Chairman 
of the AIM listed Wealth Manager, Ashcourt Rowan and 
Chairman of the Loss Adjusting group, GAB Robins. 
He has sat on a number of AIM listed boards often 
representing the interests of overseas shareholders. He is 
currently a Director of the Telematics company, Pinnacle 
Plus Holdings and the U.S. based Fusion Properties 
Management Inc. He sits on the Advisory Board of the 
U.S. Technology company I.T. Management Inc. He also 
acts as an advisor to several mid-stage UK technology 
companies.
John Morton 
(Group Chief Executive)
John is the Group Chief Executive Officer of European 
Wealth Group and an executive director of European 
Wealth Management Group. John was previously the 
founding Chief Executive of Ashcourt. He has over 30 
years’ experience of managing institutional and private 
client investments, and the management and acquisition 
of wealth management businesses. 
He began his career with Hill Samuel Investment 
Management and became a director of Abtrust Fund 
Managers (now Aberdeen Asset Managers) where he 
specialised in managing European equities before 
establishing the investment function for Brachers which 
subsequently demerged into the Ashcourt Group. He is 
also on the Boards of two UK charities.
Kishore Gopaul 
(Non-Executive Director)
Kish is a non executive director of European Wealth Group 
Limited and of European Wealth Management Group. 
He has over 30 years’ experience in international finance 
and investment. He is the Vice Chairman and Managing 
Partner of the Swiss wealth management firm Courvoisier et 
Associés, Vice Chairman of CNG Participations & Gestion, 
Vice Chairman of Courvoisier Capital, and Chairman of 
Merchant Bridge (Switzerland). He previously held executive 
roles at Citibank.
Marianne Hay 
(Independent Non-Executive Director)
Marianne is a non executive director of European Wealth 
Group. She was formerly the Head of Private Banking for 
Europe, Middle East and Africa for Standard Chartered, 
Chief Executive Officer for Citigroup’s European wealth 
management business and Head of Private Wealth 
Management for Morgan Stanley. She currently serves on 
the boards of the Court of the University of Greenwich, 
ACE Africa, the Advisory Board of Riverpeak Wealth and 
the Town and Country Housing Group.
Simon Ray 
(Chief Operating Officer)
Simon is the Chief Operating Officer of European 
Wealth Group and an executive director of European 
Wealth Management Group. He oversees the day to day 
operational side of the Group and group infrastructure. 
Simon was previously the head of Aventus Capital 
Management and has over 20 years’ experience within the 
wealth management industry.  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
16 DIRECTOR’S REPORT
DIRECTOR’S  
REPORT
The Directors present their annual report on the affairs of 
the Group, together with the audited financial statements, 
for the year to 31 December 2016. The Corporate 
Governance Statement set out on page 19 onwards, 
the strategic report on page 12 and the Highlights 
and Summary Information on page 4 form part of this 
report. All financial information given in this Directors’ 
Report is taken solely from the statutory results prepared 
in accordance with International Financial Reporting 
Standards as adopted by the EU (IFRS).
Principal activities
The principal activities of the Group are the operation 
of an investment management and financial planning 
business.
Financial risk management objectives and policies 
Information about the Group’s risk management is 
included in the Strategic Report.
Result and dividends
The Company’s performance during the year is discussed 
in the Strategic Report on pages 12 to 15. The results 
for the year are set out in the audited statement of 
comprehensive income on page 29. The Directors do not 
recommend the payment of a dividend for the year ended 
31 December 2016 (31 December 2015: £nil).
Capital Structure
Details of European Wealth’s issued share capital, 
together with details of the movements in the number of 
shares during the year, are shown in note 29. 
The Company has a convertible loan note (“CLS”) in issue. 
The CLS prior to their conversion have no right to share 
in the Company’s profits or in any surplus in the event of 
its liquidation. The CLS pay a coupon of 10% per annum 
and have stepped conversion terms. Further details of the 
note can be found at note 27 and also in the Company’s 
admission document dated 16 April 2014.
Capital Management
The primary objective of the Company’s capital 
management is to ensure that it maintains a strong 
capital structure in order to support the development 
of its business, to maximise shareholder value and to 
provide benefits for its other stakeholders. Details of the 
management of this risk can be found in the strategic 
report.
In addition, European Investment Management, European 
Wealth Trading and European Financial Planning are 
regulated by the FCA and have to comply with the FCA 
capital adequacy rules and regulations.
Directors
The names and a short biography of the Directors of the 
Company, each of whom served throughout the year and 
to date, are set out on page 15. Simon Ray was appointed 
to the Board on 1 August 2016.
With regard to the appointment and replacement 
of directors, the Group is governed by its Articles of 
Association, the UK Corporate Governance Code, The 
Companies (Guernsey) Law, 2008 and related legislation. 
The Articles themselves may be amended by special 
resolution of the Group’s shareholders. 
The Group’s Articles of Association provide that generally 
one third (rounded down to the nearest whole number)  
of the Board of Directors are required to retire by rotation, 
save for Directors who are appointed during the year,  
who must stand down and offer themselves for re-election 
at the next occurring annual general meeting of the 
Group. Accordingly, Simon Ray has offered himself for 
re-election. 
Directors’ interests
The Directors who held office at 31 December 2016 had 
the following beneficial interests in the ordinary shares of 
the Company as at 31 December 2016: EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
17 DIRECTOR’S REPORT
Number of 
Ordinary Shares held
Name of Director 2016 2015
John Morton 2,432,356 2,322,206
Kishore Gopaul 
(held by Courvoisier 
& Associates
1,635,021 1,635,021
Buzz West 346,306 318,806
Marianne Hay – –
Simon Ray 259,336 –
On 24 October 2014 John Morton loaned EWMG 
£100,000. The loan was made at an interest rate of 0% 
and is repayable at the Company’s discretion. As at the 
year end £40,000 remains outstanding (2015: £40,000 
each).
On 31 March 2016, Buzz West loaned the Company 
£100,000. The loan was made at an interest rate of 10% 
and was repayable on 31 August 2017. 
The Directors who held office at 31 December 2016 had 
the following share options over ordinary shares of the 
Group as follows:
Director Scheme
Number 
of 
Ordinary 
Share 
Options 
Date of 
Grant
Exercise 
Price 
per 
Share Exercise Period
John 
Morton
EMI 
option
335,241 27-Mar-12 25.35p
Exercisable 50% on/
after 1 Oct 2012 or 
after 1 April 2013
Simon 
Ray
EMI 
option
108,550 27-Mar-12 0.01p
Exercisable 50% on/
after 1 Oct 2012 or 
after 1 April 2013
Simon 
Ray
EMI 
option
37,468 27-Mar-12 0.05p
Exercisable 50% on/
after 1 Oct 2012 or 
after 1 April 2013
Simon 
Ray
EMI 
option
100,000 04-Aug-14 100.00p
Exercisable on or 
after 3 August 2017
Simon 
Ray
EMI 
option
25,000 01-Aug-16 53.00p
Exercisable on or 
after 31 July 2019
Employees
It is the Company’s policy to involve employees in the day 
to day operation of the Group’s business and ensure that 
matters which could concern them, including the Group’s 
strategic objectives and performance are communicated 
in an open and timely fashion. The Directors seek to 
achieve this through Management Committee meetings, 
subsidiary board meetings, e-mail communication and 
informal staff communication.
The Company is committed to an equal opportunity 
policy for all prospective and existing employees such that 
selection takes place on the basis of ability, qualifications 
and suitability for the job, irrespective of background, 
age, race, gender or sexual orientation. The Company’s 
executives, senior management and employees are 
required to support and implement all such policies in 
their daily work ethic in order to maximise the potential of 
its entire workforce.
Employees who become disabled during their 
employment with the Company will be retained and 
retrained where possible.
Future developments and events after the balance 
sheet date
A review of the Group’s business and an indication of 
likely future developments are contained in the Chairman 
and Chief Executive’s statement and in the Strategic 
Report. 
Substantial shareholdings 
On 20 June 2016, the Company had been notified, 
in accordance with Chapter 5 of the Disclosure and 
Transparency Rules, of the following voting rights as a 
shareholder of the Company of 3% or more of the issued 
share capital of the Company:
Name of 
Shareholder
Percentage of 
voting rights 
and issued 
share capital
No.of 
ordinary 
shares
John Morton and 
family
9.12% 2,432,356
Rod Gentry 8.73% 2,329,471
Unicorn Asset  
Management
8.24% 2,198,206
Courvoisier and 
Associates
6.13% 1,635,021
Michael Mechas 5.11% 1,363,636
Septer Investments 
Limited
5.07% 1,352,283
Peter Mullins 4.17% 1,112,497
George Robb 4.15% 1,106,962
ICS Risk  
Solutions Ltd
3.35% 892,857
All shareholdings stated above are beneficial. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
18 DIRECTOR’S REPORT
Policy of payment to suppliers
It is the Company’s policy to ensure that payments are 
made according to the terms and conditions of business 
agreed with the supplier. Trade creditors of the Group at 
31 December 2016 were equivalent to 35 days’ purchases 
(2015: 42 days’ purchases), based on the average daily 
amount invoiced by suppliers during the year.
Directors’ indemnities
The Company has made qualifying third party indemnity 
provisions for the benefit of its directors which were made 
during the year and remain in force at the date of this 
report.
Going concern 
The Financial Reporting Council issued a guidance note 
in April 2016 requiring all companies to provide fuller 
disclosures regarding the directors’ assessment of going 
concern. The Group’s business activities, together with the 
factors likely to affect its future development and liquidity 
and capital position, are set out in the Review of the 
Group’s Business section of the Strategic Report on page 
12.
In the year ended 31 December 2016 the Group made 
a loss before tax £0.8m (2015: loss of £1.0m), had a net 
current liability position of £8.1m (2015: £3.3m), with net 
cash generated in operating activities of £0.1m (2015: 
new cash used of £1.1m). However, of greater significance 
is that the Group made an EBITDA profit of £0.3m in the 
current year (2015: loss of £0.1m). This is the first time the 
Group has been EBITDA positive since the restructure in 
2014 and a clear indication that the strategy outlined in 
the Chairman’s Statement is being realised.
The Group still continues to look to build the asset base 
in order to improve its revenue generating capabilities. 
However, the Group also has various restructuring options 
and mitigating factors which if implemented could 
improve the short term cash flow position of the Group. 
The Group regularly monitors its actual and forecast cash 
flow position to determine whether the steps mentioned 
above are required.
However, whilst the Group expects to generate positive 
cash flows that cover its operating costs, there are material 
non operating costs that are due for payment in the next 
12 months which the Group may not be able to cover 
from its current operating cash flows. The Group has 
therefore entered into a subscription agreement to raise 
£9.3m of new capital. This will leave the Group debt free 
and able to focus on the core business going forwards 
without an ongoing material interest payment burden.
Given this, the directors have reviewed the cashflow 
forecast for the next 12 months and are satisfied that the 
Group can continue to prepare these financial statements 
on the going concern basis.
Auditor
Each of the persons who are Directors of the Company at 
the date of approval of this annual report confirms that:
•  So far as the Director is aware, there is no relevant 
audit information of which the Group’s auditor is 
unaware; and
•  The Director has taken all the steps that he/she ought 
to have taken as a Director in order to make himself/
herself aware of any relevant audit information and 
to establish that the Group’s auditor is aware of that 
information
This confirmation is given and should be interpreted in 
accordance with the provisions of s249 of The Companies 
(Guernsey) Law, 2008. 
Moore Stephens LLP has expressed its willingness to 
continue in office as auditor and a resolution to reappoint 
them will be proposed at the forthcoming Annual General 
Meeting.
Approved by the Board of Directors and signed on behalf 
of the Board on 22 June 2017
A J Morton  
Group Chief Executive 19 CORPORATE GOVERNANCE STATEMENT
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
CORPORATE  
GOVERNANCE ST A TEMENT
The Company and its Board are committed to operating 
and maintaining high standards of corporate governance 
and the effective management of risk with such matters 
being embedded in the Group’s culture.
As an AIM listed company, European Wealth Group 
Limited does not comply with the UK Corporate 
Governance Code issued in 2014 by the Financial 
Reporting Council (the “Code”). However, as outlined in 
this section, the Board considers that it is in the interests 
of shareholder protection and value to have regard to the 
Code’s principles of good governance and code of best 
practice where this is considered to be in the interests of 
shareholders.
Board Composition 
During the year under review, the Board comprised of:
•  John Morton (Executive Chairman to 31 July 2016, 
then Group Chief Executive)
•  Rod Gentry (Chief Executive Officer, resigned 29 April 
2016)
•  Kenneth “Buzz” West (Non-Executive Director to 31 
July 2016, then Non-Executive Chairman)
•  Kishore Gopaul (Non-Executive Director throughout 
the year)
•  Marianne Hay (Independent Non-Executive Director 
throughout the year)
•  Simon Ray (Executive Director appointed 1 August 
2016)
The Board considers Buzz West and Marianne Hay are 
independent as defined in the Code. Having regard to  
its size, the Board considers that the balance of  
Executive and Non-Executive Directors is appropriate  
at present. 
The full Board meets for scheduled Board meetings, on 
average, every quarter. In the year under review the full 
Board met formally four times throughout the year. 
Formal meetings of the full Board are held at the Group’s 
offices in London or via conference call. In person 
meetings of the full subsidiary boards take place every 
other month.
The Board has approved a formal schedule of matters 
reserved for its consideration and decision. 
These can be divided into a number of key areas, 
including but not limited to:
•  Group strategy and transactions
•  Financial reporting (including approval of interim and 
final financial statements and dividends)
•  The Group’s finance, banking, capital structure 
arrangements
•  Regulatory matters (including the issue of shares, 
communication and announcements to the market)
•  Approval of the Group’s compliance and risk 
management and control (as recommended by the 
Audit and Risk and Compliance Committees)
•  Approval of policies on remuneration (as 
recommended by the Remuneration Committee)
•  The constitution of the Board, including its 
various Committees, and succession planning (as 
recommended by the Remuneration Committee)
•  Approving the Group’s policies in general in respect 
of, inter alia, Health & Safety, Corporate Responsibility 
and the environment; and
•  Any HR issues or concerns 20 CORPORATE GOVERNANCE STATEMENT
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
Matters requiring Board and Committee approval are 
generally the subject of a proposal by the Executive 
Directors submitted to the Board, together with 
supporting information, as part of the Board or 
Committee papers circulated prior to the relevant 
meeting. All Directors receive appropriate information on 
the Group comprising a financial report and other relevant 
paperwork from each of the responsible Executives and 
other members of senior management before each 
scheduled Board meeting. The Executive Directors or 
other invited members of senior management present 
reports on key issues including risk, compliance, finance 
and legal issues and general strategy at each such 
meeting.
The Board recognises the importance of on-going 
professional development and education, particularly 
in respect of new laws and regulations to the business 
of the Group. Such training may be obtained by the 
Directors individually through the Group. Directors and 
staff are all encouraged to attend seminars and training 
operated by professional advisory firms and other external 
bodies. Directors may additionally obtain independent 
professional advice at the Group’s expense. Third party 
Directors’ and Officers’ liability insurance at a level 
considered appropriate for the size and nature of the 
Group’s business is maintained.
The terms and conditions of appointment of each of the 
Directors are available for inspection at the Company’s 
head office in London during normal business hours. 
The letters of appointment of each of the non-executive 
directors specifies the anticipated level of time and 
commitment including, where relevant, additional 
responsibilities in respect of the Audit, Risk and 
Compliance and Remuneration Committees. Details 
of other material commitments of the Non-Executive 
Directors are disclosed to the Board and a register of the 
same is maintained by the Company Secretary.
Subsidiary Boards
Each of the subsidiary companies in the Group has its own 
independent board which meets once a month to discuss 
key matters pertaining to each individual company. The 
Group Chief Executive and Chief Operating Officer sit on 
each of these individual boards.
Corporate Governance Structure
The post of Non-Executive Chairman is held by Buzz West 
and the post of Independent Non-Executive Director 
is held by Marianne Hay. The Board considers that the 
Non-Executive Directors provide a strong and consistent 
independence to the Executive Board. None of the 
Non-Executive Directors are involved with the day-to-day 
management of the Group and are free from any business 
or other relationship which could materially interfere 
with their judgement. Biographies of the Directors are 
contained on page 15.
During the year ended 31 December 2016 in his role as 
such, the Non-Executive Chairman was responsible for 
leadership of the Board, creating conditions for overall 
Board and individual Director effectiveness and developing 
the Group’s strategy. The Group Chief Executive Officer 
was responsible for running the Group’s business day to 
day and, subject to Board agreement, the implementation 
of strategy. Post the resignation of Rod Gentry on 29 April 
2016, John Morton took on the responsibilities previously 
held by the Chief Executive Officer.
The minutes of scheduled meetings of the Board are 
taken by the Group Chief Executive’s PA. In addition to 
constituting records of decisions taken, the minutes reflect 
questions raised by the Board members in relation to 
the Group’s business and, in particular, issues raised from 
the reports included in the Board or Committee papers 
circulated prior to the relevant meeting. Unresolved issues 
(if any) are recorded in the minutes.
The Board is of the opinion that the background of the 
Board’s Non-Executive Directors indicates that they are 
of sufficient calibre and experience to carry appropriate 
weight in the Board’s decision making process.
Corporate Governance and the management of the 
Group’s resources is achieved by regular review through 
regular meetings and conference calls, management 
meetings, monthly management accounts, presentations 
and external consultant reports and briefings. 
Board Committees 
The Board has established various committees, each of 
which has written terms of reference. These are the Audit, 
Remuneration, Risk and Nomination Committees. The 
terms of reference for each Committee are available for 
viewing at our London office.
Audit Committee
The Audit Committee is chaired by Kishore Gopaul. The 
Audit Committee is responsible for providing formal 
and transparent arrangements for considering how to 
apply suitable financial reporting and internal control 
principles having regard to good corporate governance 
and for monitoring external audit function including the 
cost-effectiveness, independence and objectivity of the 
Company’s auditor.
The independence and effectiveness of the external 
auditor is reviewed annually. The possibility of undertaking  21 CORPORATE GOVERNANCE STATEMENT
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
an audit tender process is considered on a regular basis. 
The Audit Committee meets at least once a year with the 
Auditors to discuss their independence and objectivity, 
the Annual Report, any audit issues arising, internal 
control processes, appointment and fee levels and any 
other appropriate matters. As well as providing audit 
related services, the auditors also provide taxation advice. 
The fees in respect of audit and tax services are set out in 
note 9 of the Notes to the Group Financial Statements. 
Fees for non-audit services paid to the auditors are not 
deemed to be of such significance to them as to impair 
their independence and therefore the Audit Committee 
considers that the objectivity and independence of the 
auditors is safeguarded.
On 10 November 2016, the Audit Committee approved a 
change of auditors from Deloitte LLP to Moore Stephens 
LLP .
Internal Control
The Board is responsible for establishing and maintaining 
the Group’s system of internal control and for reviewing its 
effectiveness. The system of internal controls are designed 
to manage, rather than eliminate, the risk of failure of the 
achievement of business objectives and can only provide 
reasonable but not absolute assurance against material 
misstatement or loss.
The Audit Committee continues to monitor and review the 
effectiveness of the system of internal control and report 
to the Board when appropriate with recommendations.
The annual review of internal control and financial 
reporting procedures did not highlight any issues 
warranting the introduction of an internal audit function. 
It was concluded, given the current size and transparency 
of the operations of the Group, that an internal audit 
function was not required. The main features of the 
internal control system are outlined below:
•  A control environment exists through the close 
management of the business by the Executive 
Directors. The Group has a defined organisational 
structure with delineated approval limits. Controls 
are implemented and monitored by the Executive 
Directors
•  The Board has a schedule of matters expressly 
reserved for its consideration and this schedule 
includes acquisitions and disposals, major capital 
projects, treasury and risk management and approval 
of budgets
•  The Group utilises a detailed budgeting and 
forecasting system. Detailed budgets are prepared 
annually by the Executive Directors before submission 
to the Board for approval. Forecasts are updated to 
reflect changes in the business and are monitored by 
the Board including future cash flow projections. Actual 
results are monitored against annual budgets in detail 
with variances highlighted to the Board
•  Financial risks are identified and evaluated for 
consideration by the Board and senior management; 
and
•  Standard financial control procedures are operated 
throughout the Group to ensure that the assets of the 
Group are safeguarded and that proper accounting 
records are maintained
Remuneration Committee
The Remuneration Committee is chaired by Buzz 
West. The Remuneration Committee is responsible for 
establishing a formal and transparent procedure for 
developing policy on Executive remuneration and to 
set the remuneration packages of individual Directors. 
This includes agreeing with the Board the framework 
for remuneration of the Group Chief Executive, all other 
executive Directors, the Company Secretary and such 
other members of the executive management of the 
Company as it is designated to consider. 
It is also responsible for determining the total individual 
remuneration packages of each Director including, where 
appropriate, bonuses, incentive payments and share 
options. No Director will play a part in any decision about 
his/her own remuneration. 
There was one Remuneration Committee meeting during 
the financial year ended 31 December 2016. The Board 
considers the composition of the Committee appropriate 
given the size of the Group. No Director has a service 
contract for longer than 12 months.
The Board retains responsibility for overall remuneration 
policy. Executive remuneration packages are designed 
to attract and retain executives of the necessary skill and 
calibre to run the Group. The Remuneration Committee 
recommends to the Board the remuneration packages 
by reference to individual performance and uses the 
knowledge and experience of the Committee members, 
published surveys relating to AIM companies, the 
financial services industry and market changes generally. 
The Remuneration Committee has responsibility for 
recommending any long-term incentive schemes.
The Board determines whether or not Executive Directors 
are permitted to serve in roles with other companies. 
Such permission would only be granted on a strictly  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
22 CORPORATE GOVERNANCE STATEMENT
limited basis, where there are no conflicts of interest 
or competing activities and providing there is not an 
adverse impact on the commitments required to the 
Group. Earnings from such roles would be required to be 
disclosed to the Executive Chairman.
There are four main elements of the remuneration 
package for Executive Directors and staff:
1.  Basic salaries and benefits in kind: Basic salaries are 
recommended to the Board by the Remuneration 
Committee, taking into account the performance of 
the individual and the rates for similar positions in 
comparable companies. Benefits in kind, comprising 
death in service cover are available to all staff 
and Executive Directors. Benefits in kind are non-
pensionable.
2.  Share options: The Company operates approved share 
option schemes for Executive Directors and other 
employees to motivate those individuals through 
equity participation. Exercise of share options under 
the schemes is subject to specified exercise periods 
and compliance with the AIM Rules. The schemes 
are overseen by the Remuneration Committee which 
recommends to the Board all grants of share options 
based on the Remuneration Committee’s assessment 
of personal performance and specifying the terms 
under which eligible individuals may be invited to 
participate. The Code refers to the requirement for 
the performance related elements of remuneration to 
form a significant proportion of the total remuneration 
package of Executive Directors and should be 
designed to align their interests with those of 
shareholders. In this re-structuring and development 
phase of the Group the Remuneration Committee 
currently considers that the best alignment of these 
interests is through the continued use of incentives for 
performance through the award of share options.
3.  Bonus Scheme: The Group has a bonus scheme for 
staff and Executive Directors which is specific to each 
individual and the role performed by that individual 
within the Group.
4.  Pension Contributions: The Group pays a defined 
contribution to the pension schemes of Executive 
Directors and other employees. The individual 
pension schemes are private and their assets are held 
separately from those of the Group. 
Policy on Non Executive Remuneration
The Non-Executive Directors each receive a fee for their 
services as a director which is approved by the Board, 
mindful of the time commitment and responsibilities of 
their roles and of current market rates for comparable 
organisations and appointments. Non Executive Directors 
are also reimbursed for travelling and other incidental 
expenses incurred on Group business.
The Board encourages the ownership of shares in the 
Company by Executive and Non Executive Directors alike 
and in normal circumstances does not allow Directors to 
undertake dealings of a short term nature. 
The Board considers ownership of Company shares by 
Non-Executive Directors as a positive alignment of their 
interest with shareholders. The Board will periodically 
review the shareholdings of the Non-Executive Directors 
and will seek guidance from its advisors if, at any time, it 
is concerned that the shareholding of any Non-Executive 
Director may, or could appear to, conflict with their 
duties as an independent Non-Executive Director of the 
Company. Directors’ emoluments, including Directors’ 
interest in share options over the Group’s share capital, 
are set out in the Director’s Report (Page 17) and the 
Director’s Remuneration Report (page 25).
Risk and Compliance Committee 
The Board has appointed a Risk and Compliance 
Committee, which, at present, comprises the Senior 
Independent Non-Executive Director, the Executive 
Directors of the Company, the Head of Finance, the CF10 
responsible for the compliance of EIM, EWT and EFP 
along with various directors of the subsidiary boards. The 
Committee’s Chairman is Buzz West. The Committee will 
generally convene every quarter and the Board considers 
the composition of the Committee appropriate given the 
size of the Group’s business. During the year under review, 
the Committee met formally a total of three times. 
The Committee is authorised and empowered by the 
Board to, inter alia, provide oversight and advice to the 
Board in relation to current and potential risk exposure 
and future compliance/risk strategy, review the Group’s 
risk profile relative to current and future risk appetite, 
monitor risk and make recommendations to the Board 
concerning all elements of the Group’s compliance with 
the FCA’s rules and those of the London Stock Exchange, 
make recommendations to the Board in respect of the 
Group’s risk appetite and any associated authorities 
and limits and oversee the Group’s risk management 
framework to ensure effective risk identification and 
management throughout the Group.
Certain subsidiaries in the Group are regulated by the 
FCA Rules and as such are required to ensure that they 
maintain sufficient regulatory capital at all times. The  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
23 CORPORATE GOVERNANCE STATEMENT
Company has developed a risk management framework 
that dovetails into its ICAAP (Internal Capital Adequacy 
Assessment Process). The ICAAP is used to ensure that 
the Group has sufficient capital in place to immediately 
cover risks identified. The ICAAP is regularly reviewed and 
updated.
In addition, the Group utilises various other means to 
ensure that it is in compliance with the rules set out by the 
FCA and operates within the appropriate risk limits set by 
the Board. These include a compliance manual covering 
significant business and operational activities, policies 
covering conflicts of interest, insider dealing, market 
abuse, personal account dealing and client acceptance 
procedures as well as regular monitoring of market and 
credit risk. These matters are the subject of periodic 
review by the Risk and Compliance Committee.
Nomination Committee
The Nomination Committee is chaired by Kishore 
Gopaul and is also comprised of Buzz West. The 
Nomination Committee is responsible for considering 
Board appointments, reviewing Board structure, size 
and composition and identifying the need for Board 
appointments by reference to the balance of skills, 
knowledge and experience on the Board and the scale of 
the Enlarged Group.
There was one Nomination Committee meeting during 
the financial year ended 31 December 2016. The Board 
considers the composition of the Committee appropriate 
given the size of the Group. 
Re-election
Under the Group’s articles of association, all Directors are 
subject to election by shareholders at the annual general 
meeting following appointment and all Directors are 
subject to retirement by rotation requiring re-election at 
intervals of no more than three years. 
Performance evaluation
A formal evaluation of the Board and each of the 
individual Directors own performances are undertaken 
annually. This will include a review of success in achieving 
objectives set during the year and agreeing areas for 
improvement going forward. 
Relationship with shareholders and dialogue with 
institutional shareholders
The Non-Executive Chairman and the Group Chief 
Executive maintain dialogue with key shareholders in 
relation to, inter alia, strategy and corporate governance 
issues.
All shareholders will receive the Annual Report and 
financial statements and are welcome to attend the 
Company’s annual general meeting (“AGM”). The 
Directors attend the meeting and are available to answer 
questions both formally during the meeting and informally 
afterwards.
The collection and analysis of the proxy votes will be 
handled independently by the Group’s registrars. The 
Chairman of the meeting announces the results of the 
proxy votes that have been lodged after shareholders 
have voted on a show of hands. Details of the AGM are 
set out in the notice of the meeting enclosed with this 
report. All Committee chairmen are, where possible, 
available at the AGM. The Non-Executive Directors are 
available to shareholders and may be contacted through 
the Group Chief Executive’s PA.
The Group’s website at www.europeanwealth.com is an 
important source of information for investors, including 
information required in compliance with AIM Rule 26, and 
is updated regularly.
Corporate social responsibility
The Group is committed to conducting its business in a 
socially responsible manner and to respect the needs of 
employees, investors, customers, suppliers, regulators 
and other stakeholders. The Group is also committed to 
being a responsible employer and to promoting values, 
standards and policies designed to assist our employees 
in their conduct, working and business relationships.
The most significant impact on the environment resulting 
from the Group’s activities is the emission of greenhouse 
gases as a result of running the Group’s offices, associated 
travel and the recycling of waste. The Group is committed 
to minimising the amount of travel that its employees 
undertake and to recycling as much of the group’s waste 
as possible. The Group will continue to look at ways to act 
in a socially responsible manner.
Internal control and risk management
The Board, with the assistance of its Committees, is 
responsible for analysing the strategic financial and 
operational risks which could affect the Group’s business. 
Any potential impact is prioritised and evaluated not only 
in terms of the possible financial impact on the Group 
such as loss of income or additional expenditure but also 
according to potential effects on employee’s operational 
processes and stakeholder regulations.
The successful management of such risks is seen as key 
to the Group’s ability to achieve its corporate financial 
objectives. The Group’s key risks are explained in detail in 
the Strategic Report. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
24 CORPORATE GOVERNANCE STATEMENT
Overall responsibility for the risk management process 
rests at Board level. The Board systematically reviews and 
evaluates the risks of the Group regularly, which ensures 
that as new risks emerge in connection with projects or 
general market developments, appropriate actions can 
be discussed, agreed and taken in a flexible manner. The 
Group’s Risk and Compliance Committee is integral to this 
process.
Overall, the Board, together with its Audit Committee, 
is responsible for the development of the systems of 
internal controls. This responsibility includes safeguarding 
the Group’s assets against unauthorised use, maintaining 
proper accounting records and ensuring accurate financial 
information. The Directors recognise that such systems 
are designed to manage rather than eliminate the risk of 
failure to achieve business objectives but cannot provide 
absolute assurance against material misstatement, 
financial loss or fraud. The Board appoints experienced, 
professional staff to fulfil their duties and responsibilities. 
The Board considers that the size and centralisation of 
the key finance activities of the Group, at present, do 
not justify the creation of an internal audit function at the 
present time but will review this on a regular basis.  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
25 DIRECTORS’ REMUNERATION REPORT
DIRECTORS’  
REMUNERA TION REPORT
Directors’ Emoluments 
Companies whose securities are traded on AIM are not required to provide a formal Remuneration Report and 
accordingly this report is provided, for information only, to give a greater transparency to the manner in which Directors 
are remunerated:
Basic 
salary  
£
Benefits 
in kind 
£
Termination 
payments 
£
Share based 
payments 
£
2016 
Total 
£
2015 
Total 
£
Executive
John Morton 200,000 22,994 – – 222,994 222,707
Simon Ray (appointed 1-Aug-16) 47,917 5,735 – 13 53,665 –
Rod Gentry (resigned 29-Apr-16) 66,667 22,539 193,333 – 282,539 222,247
Non-Executive
Kishore Gopaul 18,000 – – – 18,000 18,000
Buzz West 45,000 – – – 45,000 45,000
Marianne Hay 18,000 – – – 18,000 1,500
Aggregate emoluments 395,584 51,268 193,333 13 640,198 509,454
Signed on behalf of the Board on 22 June 2017
A J Morton  
Group Chief Executive EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
26 DIRECTORS’ RESPONSIBILITIES STATEMENT
DIRECTORS’  
RESPONSIBILITIES ST A TEMENT
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 prepared the Group financial statements 
in accordance with International Financial Reporting 
Standards (IFRSs) as adopted by the European Union 
and have also chosen to prepare the Parent Company 
financial statements under IFRSs as adopted by the EU. 
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 
Group and of the Statement of Comprehensive Income 
of the Group for that period. In preparing these financial 
statements, International Accounting Standard 1 requires 
that Directors:
•  Properly select and apply accounting policies
•  Present information, including accounting policies, in 
a manner that provides relevant, reliable, comparable 
and understandable information
•  Provide additional disclosures when compliance with 
the specific requirements in IFRSs are insufficient to 
enable users to understand the impact of particular 
transactions, other events and conditions on the 
entity’s financial position and financial performance 
and
•  Make an assessment of the company’s ability to 
continue as a going concern
The directors are responsible for keeping adequate 
accounting records that are sufficient to show and explain 
the Company’s transactions and disclose with reasonable 
accuracy at any time the financial position of the Company 
and enable them to ensure that the financial statements 
comply with the The Companies (Guernsey) Law, 2008. 
They are also responsible for safeguarding the assets 
of the company and hence for taking reasonable steps 
for the prevention and detection of fraud and other 
irregularities.
The Directors are responsible for the maintenance and 
integrity of the corporate and financial information 
included on the company’s website. Legislation in the 
United Kingdom and Guernsey governing the preparation 
and dissemination of financial statements may differ from 
legislation in other jurisdictions.
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 European Union, 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 
consolidation taken as a whole
•  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 taken as a whole, 
together with a description of the principal risks and 
uncertainties that they face and
•  The Annual Report and financial statements, taken as 
a whole, are fair, balanced and understandable and 
provide the information necessary for shareholders to 
assess the Company’s performance, business model 
and strategy
Signed on behalf of the Board on 22 June 2017
A J Morton  
Group Chief Executive EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
27 INDEPENDENT AUDITOR’S REPORT
We have audited the financial statements of European 
Wealth Group Limited for the year ended Year End 
which are set out on pages 29-34. The financial reporting 
framework that has been applied in their preparation 
is applicable law and International Financial Reporting 
Standards (IFRSs) as adopted by the European Union 
and, as regards the parent company financial statements, 
as applied in accordance with the provisions of The 
Companies (Guernsey) Law, 2008.
This report is made solely to the company’s members, 
as a body, in accordance with Section 262 of The 
Companies (Guernsey) Law, 2008. Our audit 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 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 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 auditor 
As explained more fully in the Directors’ Responsibilities 
Statement set out on page 26, the directors are 
responsible for the preparation of the financial statements 
and for being satisfied that they give a true and fair view. 
Our responsibility is to audit and express an opinion on 
the financial statements in accordance with applicable law 
and International Standards on Auditing (UK and Ireland). 
Those standards require us to comply with the Auditing 
Practices Board’s (APB’s) Ethical Standards for Auditors.
Scope of the audit of the financial statements 
An audit involves obtaining evidence about the amounts 
and disclosures in the financial statements sufficient to 
give reasonable assurance that the financial statements 
are free from material misstatement, whether caused by 
fraud or error. This includes an assessment of: whether 
the accounting policies are appropriate to the group’s 
and the parent company’s circumstances and have been 
consistently applied and adequately disclosed; the 
reasonableness of significant accounting estimates made 
by the directors; and the overall presentation of the 
financial statements. In addition, we read all the financial 
and non-financial information in the Annual Report 
to identify material inconsistencies with the audited 
financial statements and to identify any information that 
is apparently materially incorrect based on, or materially 
inconsistent with, the knowledge acquired by us in the 
course of performing the audit. If we become aware of 
any apparent material misstatements or inconsistencies we 
consider the implications for our report.
Opinion on financial statements
In our opinion:
•  the financial statements give a true and fair view of the 
state of the group’s and the parent company’s affairs as 
at 31 December 2016 and of the group’s loss for the 
year then ended;
•  the group financial statements have been properly 
prepared in accordance with IFRSs as adopted by the 
European Union and complying the requirements of 
The Companies (Guernsey) Law, 2008;
•  the parent company financial statements have been 
properly prepared in accordance with IFRSs as 
adopted by the European Union and complying with 
the provisions of The Companies (Guernsey) Law, 
2008;
Matters on which we are required to report by 
exception
In the light of the knowledge and understanding of 
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.
INDEPENDENT 
AUDITOR’S REPORT EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
28 INDEPENDENT AUDITOR’S REPORT
We have nothing to report in respect of the following 
matters where The Companies (Guernsey) Law requires us 
to report to you if, in our opinion:
•  proper accounting records have not been kept by the 
company; 
•  the financial statements are not in agreement with the 
accounting records; or
•  we have failed to obtain all the information and 
explanations, which, to the best of our knowledge and 
belief, are necessary for the purposes of our audit.
 
Lorraine Bay, Senior Statutory Auditor
For and on behalf of  
Moore Stephens LLP , Statutory Auditor 
150 Aldersgate Street 
London EC1A 4AB
22 June 2017 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
29 CONSOLIDATE STATEMENT OF COMPREHENSIVE INCOME
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2016
Note
2016
£’000
2015
£’000
Revenue 7 9,412 7,653
Cost of sales (1,165) (1,188)
Gross Profit 8,247 6,465
Administrative expenses (8,096) (7,253)
Depreciation and amortisation (538) (424)
Other gains / (losses) 194 719
Operating loss (193) (493)
Finance costs (568) (509)
Loss before tax (761) (1,002)
Tax 4 11
Loss for the year (757) (991)
Other comprehensive income
Items that may be reclassified subsequently to profit & loss:  
Exchange difference on translation of foreign operations
(30) –
Total comprehensive loss for the year (787) (991)
Loss per share
Basic (0.03)p (0.05)p
Diluted (0.03)p (0.04)p
The entire Group’s revenue and operating (loss)/profit was derived from continuing operations. 
The operating loss and total comprehensive loss for the year are attributable to the equity holders. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
30 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Consolidated Statement of Financial Position
As at 31 December 2016
Note
31 December 
2016
£’000
31 December
2015
£’000
Non-current assets
Fixtures and equipment 16 159 170
Intangible assets and goodwill 18 25,944 24,744
Investments 19 13 13
Deferred tax asset 20 428 428
Total non-current assets 26,544 25,355
Current assets
Trade and other receivables 21 926 797
Cash and cash equivalents 24 375 179
Total current assets 1,301 976
Total assets 27,845 26,331
Current liabilities
Trade and other payables 25 4,119 3,620
Short term borrowings 26 5,263 662
Total liabilities 9,382 4,282
Non-current liabilities
Convertible loan note 27 – 3,963
Other non-current term liabilities 28 618 808
Total non-current liabilities 618 4,771
Total net assets 17,845 17,278
Equity
Share capital 29 1,270 1,171
Share premium account 30 13,596 12,654
Capital reserve 31 603 351
Foreign exchange reserve 32 30 –
Retained earnings 33 2,346 3,102
Total equity 17,845 17,278
The financial statements of European Wealth Group Limited (registered number 42316) were approved by the Board of 
Directors and authorised for issue on 22 June 2017, signed on its behalf by:
A J Morton 
Group Chief Executive EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
31 COMPANY STATEMENT OF FINANCIAL POSITION
Company Statement of Financial Position
For year ended 31 December 2016
Note
31 December 
2016
£’000
31 December
2015
£’000
Non-current assets
Intangible assets 18 698 –
Investments 19 17,079 18,373
Total non-current assets 17,777 18,373
Current assets
Trade and other receivables 21 5 2
Loans receivable 23 7,591 7,153
Cash and cash equivalents 24 5 1
Total current assets 7,601 7,156
Total assets 25,378 25,529
Current liabilities
Trade and other payables 25 2,267 1,871
Short term borrowings 26 5,002 300
Total current liabilities 7,269 2,171
Non-current liabilities
Convertible loan note 27 – 3,963
Other non-current term liabilities 28 309 200
Total non-current liabilities 309 4,163
Total net assets 17,800 19,195
Equity
Share capital 29 1,270 1,171
Share premium account 30 13,596 12,654
Capital reserve 31 603 351
Retained earnings 33 2,331 5,019
Total equity 17,800 19,195
The financial statements of European Wealth Group Limited (registered number 42316) were approved by the Board of 
Directors and authorised for issue on 22 June 2017, signed on its behalf by:
A J Morton 
Group Chief Executive EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
32 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Consolidated Statement of Changes in Equity
For year ended 31 December 2016
Consolidated
Share 
Capital 
£’000
Share 
Premium 
Account 
£’000
Capital 
Reserve 
£’000
Foreign 
Exchange 
Reserve 
£’000
Retained 
Earnings 
£’000
Total 
£’000
Balance at 1 January 2015 983 9,851 1,719 – 4,093 16,646
Loss for the year – – – – (991) (991)
Issue of share capital 188 2,893 – – – 3,081
Share based settlement of 
deferred consideration – – (1,374) – – (1,374)
Share based payments – – 6 – – 6
Allowable costs of fundraise – (90) – – – (90)
Balance at 31 December 2015 1,171 12,654 351 – 3,102 17,278
Loss for the year – – – – (756) (756)
Issue of share capital 53 488 250 – – 791
Share based settlement of 
deferred consideration 46 454 – – – 500
Share based payments – – 2 – – 2
Retranslation of overseas 
operations – – – 30 – 30
Balance at 31 December 2016 1,270 13,596 603 30 2,346 17,845 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
33 COMPANY STATEMENT OF CHANGES IN EQUITY
Company Statement of Changes in Equity
For year ended 31 December 2016
Company
Share 
Capital 
£’000
Share 
Premium 
Account 
£’000
Capital 
Reserve 
£’000
Foreign 
Exchange 
Reserve 
£’000
Retained 
Earnings 
£’000
Total 
£’000
Balance at 1 January 2015 983 9,851 1,719 – 4,568 17,121
Profit for the period – – – – 451 451
Issue of share capital 188 2,893 – – – 3,081
Share based settlement of 
deferred consideration
– – (1,374) – – (1,374)
Share based payments – – 6 – – 6
Allowable costs of fundraise – (90) – – – (90)
Balance at 31 December 2015 1,171 12,654 351 – 5,019 19,195
Loss for the period – – – – (2,688) (2,688)
Issue of share capital 53 488 250 – – 791
Share based settlement of 
deferred consideration
46 454 – – – 500
Share based payments – – 2 – – 2
Retranslation of overseas 
operations
– – – – – –
Balance at 31 December 2016 1,270 13,596 603 – 2,331 17,800 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
34 CONSOLIDATED AND COMPANY STATEMENT OF CASHFLOWS
Consolidated and Company Statement of Cashflows
For year ended 31 December 2016
Group Company
Note
2016
£‘000
2015
£‘000
2016
£‘000
2015
£‘000
Net cash used in operating activities 34 93 (1,072) (579) (545)
Investing activities
PPE purchased (18) (8) – –
Acquisition of investments – (30) – (20)
Deferred consideration (216) – – –
Loans advanced (200) – – –
Cash acquired on acquisitions 40 (824) – –
Net cash used in investing activities (394) (862) (134) (1,199)
Financing activities
Net proceeds on issue of shares 541 1,918 541 1,918
Interest paid (344) (491) (318) (417)
Loans receivable repaid (256) (201) (186) –
New loans received 539 650 680 68
Net cash from financing activities 480 1,876 717 1,569
Net increase /(decrease) in cash and cash 
equivalents
179 (58) 4 (175)
Cash and cash equivalents at beginning of 
year
179 237 1 176
Effects of movement in exchange rates on cash 
held by foreign operations
17 – – –
Cash and cash equivalents at end of year 24 375 179 5 1 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
35 NOTES TO THE FINANCIAL STATEMENTS
NOTES TO 
THE FINANCIAL ST A TEMENTS
1. General information
European Wealth Group Limited is a company incorporated in Guernsey under The Companies (Guernsey) Law, 2008. 
The shares of the Group are traded on AIM. The nature of the Group’s operations and its principal activities are set out 
in the Strategic Report. Certain subsidiaries in the Group are subject to the FCA’s regulatory capital requirements and 
therefore required to monitor their compliance with credit, market and operational risk requirements, in addition to 
performing their own assessment of capital requirements as part of the Individual Capital Adequacy Assessment Process 
(ICAAP).
2. Basis of accounting
The financial statements of the Group and the Company have been prepared in accordance with International Financial 
Reporting Standards (“IFRS”s) adopted by the European Union and therefore the Group financial statements comply 
with Article 4 of the EU IAS Regulation.
The financial statements have been prepared on the historical cost basis, except for the revaluation of financial 
instruments (please refer to significant accounting policies note for details, note 5). Historical cost is generally based on 
the fair value of the consideration given in exchange for the assets. The principal accounting policies adopted are set 
out below.
3. Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Group made up to 31 December each 
year. From 1 January 2013 to 6 May 2014, the Group consisted solely of European Wealth Group Limited, which at the 
time was an Investment Company.
The Group now consists of the following subsidiaries, European Wealth Management Group Limited, European Investment 
Management Limited, European Financial Planning Limited, European Wealth Trading Limited, European Wealth 
(Switzerland) SA, GTI Fund Investment Ltd P&C Global, EIM Nominees Limited, European Wealth (Gibraltar) Limited, and 
XCAP Nominees Limited. 
All acquisitions are consolidated on the date of acquisition. 
For the purpose of the consolidated financial statements, the results and financial position of each group company are 
expressed in pounds sterling, which is the functional currency of the Company and the presentational currency for the 
consolidated financial statements.
European Wealth Management Group Limited, European Investment Management Limited, European Financial Planning 
Limited, European Wealth Trading Limited have been consolidated in to the consolidated statement of comprehensive 
income as of 7 May 2014. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
36 NOTES TO THE FINANCIAL STATEMENTS
Compass Financial Benefits Limited has been consolidated as of 25 June 2014, all revenue is incorporated within 
European Financial Planning Limited, and the Company has ceased trading as a separate entity.
European Wealth (Switzerland) SA has been consolidated as of 1 December 2014. This company reports its company 
accounts in Swiss Francs. These have been converted into Sterling for the purposes of the consolidation based on year 
end rates for the balance sheet and average rates for the Income Statement.
Greensnow Limited, ISM Financial Solutions Limited and ISM Wealth Management Limited have been consolidated as 
of 1 July 2015, all revenue is incorporated within European Financial Planning Limited, and the Companies have ceased 
trading as separate entities.
EIM Nominees Limited has net assets of £21 and therefore that Company’s information is not shown separately. Under 
The Companies (Guernsey) Law, 2008, EIM Nominees Limited is exempt from the requirement to present its own 
income statement.
European Wealth (Gibraltar) Limited has been consolidated as of 21 September 2016. This company reports its company 
accounts in US Dollars. These have been converted into Sterling for the purposes of the consolidation based on year 
end rates for the balance sheet and average rates for the Income Statement.
XCAP Nominees Limited is a non trading entities. 
4. Adoption of new and revised standards 
New accounting standards, amendments and interpretations adopted in the period
In the year ended 30 June 2016, the group did not adopt any new standards or amendments issued by the IASB 
or interpretations issued by the IFRS Interpretations Committee (IFRS IC) that have had a significant impact on the 
consolidated financial statements.
The following new and revised standards and interpretations have been adopted in the current year. Their adoption has 
not had any significant impact on the amounts reported in these financial statements, but may impact the accounting for 
future transactions and arrangements
Annual Improvements to IFRSs 2010 – 2012 Cycle 
Annual Improvements to IFRSs 2011 – 2013 Cycle 
New accounting standards, amendments and interpretations not yet adopted
At the date of authorisation of these financial statements, The Group has not applied the following new and revised 
IFRSs that have been issued but are not yet effective and in some cases had not yet been adopted by the EU:
IFRS 9 – Financial Instruments
IFRS 15 – Revenue from Contracts with Customers
IFRS 11 (amendments) – Accounting for Acquisitions of Interests in Joint Operations
IAS 1 (amendments) – Disclosure Initiative
IAS 16 and IAS 38 (amendments) – Clarification of Acceptable Methods of Depreciation and Amortisation
IAS 27 (amendments) – Equity Method in Separate Financial Statements
IFRS 10 and IAS 28 (amendments) – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture
IFRS 10, IFRS 12 and IAS 28 (amendments) – Investment Entities: Applying the Consolidation Exemption
IFRS 16 Leases
IFRS 16 replaces IAS 17 Leases. It eliminates the classification of leases as either operating leases or finance leases. Any 
leases with more than 12 months’ term are to be recognised as a lease asset on the balance sheet and the related future 
lease obligations as a liability. IFRS 16 is only effective for annual periods beginning on or after 1 January 2019. The 
Group did not apply early adoption. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
37 NOTES TO THE FINANCIAL STATEMENTS
Annual Improvements to IFRSs: 2012-2014 Cycle Amendments to: IFRS 5 Non-current Assets Held for Sale and 
Discontinued Operations, IFRS 7 Financial Instruments: Disclosures, IAS 19 Employee Benefits and IAS 34 Interim 
Financial Reporting.
The directors do not expect that the adoption of the Standards listed above will have a material impact on the financial 
statements of the Group in future periods, except that IFRS 9 will impact both the measurement and disclosures of 
financial instruments and IFRS 15 may have an impact on revenue recognition and related disclosures. Beyond the 
information above, it is not practicable to provide a reasonable estimate of the effect of IFRS 9 and IFRS 15 until a 
detailed review has been completed. The above standards have not had significance on the Group or on the Company 
other than on disclosures.
5. Significant accounting policies
Going concern
The Directors have, at the time of approving the financial statements, a reasonable expectation that the Group and 
the Company have adequate resources to continue in operational existence for the foreseeable future. Accordingly 
they continue to adopt the going concern basis of accounting in preparing the financial statements. Further detail is 
contained in the Directors’ Report on page 16.
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for 
services provided in the normal course of business.
Management fees – Investment management fees are based on funds under management and are recognised over the 
period in which the service relates to is completed.
Commission income – Commissions are recognised when the service is completed.
Fee income – Fees for consultancy services are recognised as the service is performed.
Other income – Other income is recognised as the services are provided.
Interest income – Interest income is recognised when it is probable that the economic benefits will flow to the Group 
and the amount of revenue can be measured reliably. Interest income is accrued on a time basis, by reference to the 
principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated 
future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial 
recognition.
Operating lease payments
The rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not 
made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on 
a straight-line basis over the lease term, unless another basis is more appropriate.
Borrowing costs
All borrowing costs are recognised in the income statement in the period in which they are incurred.
Retirement benefit costs 
The company contributes to defined contribution pension schemes, held in separately administered funds. 
Contributions to the schemes are charged to the Consolidated Statement of Comprehensive Income when  
payable. 
Operating loss
Operating loss is stated before charging finance costs and investment income. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
38 NOTES TO THE FINANCIAL STATEMENTS
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax – The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit  
as reported in the Statement of Comprehensive Income because it excludes items of income or expense that are taxable 
or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for 
current tax is calculated using tax rates that have been enacted or substantively enacted by the balance  
sheet date.
Deferred tax – Deferred tax is the tax expected to be payable or recoverable on differences between the carrying 
amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation 
of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally 
recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable 
that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and 
liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill or from the initial 
recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the 
taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and 
associates, and interests in joint ventures, except where the Group is able to control the reversal of the temporary 
difference and it is probable that the temporary difference will not reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it 
is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. 
Detailed financial forecasts are in place to support the carrying value of the deferred asset.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the 
asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or 
credited directly to equity, in which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against 
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends 
to settle its current tax assets and liabilities on a net basis.
Fixtures and equipment
Fixtures and equipment are stated at cost less accumulated depreciation and any recognised impairment loss.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful 
lives, using the straight-line method, on the following bases:
Equipment, fixtures and fittings: 15% per annum on a straight-line basis
The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales 
proceeds and the carrying amount of the asset and is recognised in income.
Business combinations
All business combinations are accounted for by applying the acquisition method. The acquisition method involves 
recognition, at fair value, of all identifiable assets and liabilities, including contingent liabilities, of the subsidiary at the 
acquisition date, regardless of whether or not they were recorded in the financial statements of the subsidiary prior to 
acquisition. The cost of business combinations is measured based on the fair value of the equity or debt instruments 
issued and cash or other consideration paid, plus any directly attributable costs. 
Goodwill arising on a business combination represents the excess of cost over the fair value of the Group’s share of the 
identifiable net assets acquired and is stated at cost less any accumulated impairment losses. Goodwill is tested annually 
for impairment. Any impairment is recognised immediately in the income statement and is not subsequently reversed. 
Negative goodwill arising on an acquisition is recognised immediately in the income statement. On disposal of a  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
39 NOTES TO THE FINANCIAL STATEMENTS
subsidiary the attributable amount of goodwill that has not been subject to impairment is included in the determination 
of the profit or loss on disposal.
Impairment – Goodwill and other intangible assets with an indefinite life are tested annually for impairment. For the 
purposes of impairment testing, goodwill acquired in a business combination is allocated to each of the group’s cash 
generating units (CGUs) that are expected to benefit from the combination, irrespective of whether other assets or 
liabilities of the acquisition are assigned to those units. The carrying amount of each CGU is compared to its recoverable 
amount, which is determined using a discounted future cash flow model.
Where goodwill forms part of a CGU and part of the operation within that unit is disposed of, the goodwill associated 
with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss 
on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative values of the 
operation disposed of and the portion of the CGU retained.
Intangible assets
Client relationships – Client relationships acquired in a business combination are recognised at fair value at the 
acquisition date. Relationships acquired outside of a business combination are initially recognised at cost. In assessing 
the fair value of these relationships, the Group has estimated their finite life based on information about the typical 
length of existing client relationships. Amortisation is calculated using the straight line method over their useful lives, 
ranging from 10 to 20 years.
Goodwill – Goodwill represents the excess of the cost of acquisition over the fair value of the Group’s share of the 
net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill on acquisitions of subsidiaries 
is included in ‘intangible assets’. Goodwill is tested annually for impairment and carried at cost less accumulated 
impairment losses. Impairment losses on goodwill are not reversed. 
Financial assets and liabilities
Financial assets and liabilities are recognised in the Group’s balance sheet when the Group becomes a party to the 
contractual provisions of the instrument and are initially measured at fair value. 
Financial assets and liabilities are classified into the following specified categories: fair value through profit or loss and 
loans and receivables. The classification depends on the nature and purpose of the financial assets and is determined at 
the time of initial recognition.
Fair value through profit and loss – Financial assets at fair value through profit or loss are initially recognised at fair value 
and subsequently re-measured, with gains or losses arising from changes in fair value being recognised in profit and loss 
in in the period in which they arise.
Loans and receivables – Trade receivables, loans, and other receivables that have fixed or determinable payments that 
are not quoted in an active market are classified as ‘loans and receivables’. Loans and receivables are measured at 
amortised cost using the effective interest method, less any impairment. Interest income is recognised by applying the 
effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at 
each balance sheet date. Financial assets are impaired where there is objective evidence that, as a result of one or more 
events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment 
have been affected. 
Objective evidence of impairment could include:
•  Significant financial difficulty of the issuer or counterparty; or
•  Default or delinquency in interest or principal payments; or
•  It becoming probable that the borrower will enter bankruptcy or financial re-organisation EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
40 NOTES TO THE FINANCIAL STATEMENTS
For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired 
individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a 
portfolio of receivables could include the Group’s past experience of collecting payments, an increase in the number of 
delayed payments in the portfolio past the average credit period of 60 days, as well as observable changes in national 
or local economic conditions that correlate with default on receivables.
For financial assets carried at amortised cost, the amount of the impairment is the difference between the asset’s 
carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original 
effective interest rate.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the 
exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When 
a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries 
of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the 
allowance account are recognised in the Statement of Comprehensive Income.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an 
event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through the 
Statement of Comprehensive Income to the extent that the carrying amount of the investment at the date the impairment 
is reversed does not exceed what the amortised cost would have been had the impairment not been recognised. 
Equity
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of 
the contractual arrangement. 
Equity instruments 
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its 
liabilities. Equity instruments issued by the Group are recognised at the proceeds received, net of direct issue costs.
Effective interest rates  
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating 
interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future 
cash payments through the expected life of the financial liability, or, where appropriate, a shorter period, to the net 
carrying amount on initial recognition.
Derecognition of financial liabilities 
The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or 
they expire.
Client money 
The Group holds money on behalf of clients in accordance with the client money rules of the Financial Conduct 
Authority and other regulatory bodies. Such money and the corresponding liabilities to clients are not shown on the face 
of the Statement of Financial Position, as the Group is not beneficially entitled thereto. The amounts held on behalf of 
clients at the balance sheet date are stated in note 24. 
Deferred consideration
Deferred consideration, which is included within liabilities or equity depending on the form it takes, relates to the 
directors’ best estimate of amounts payable in the future in respect of certain client relationships and subsidiary 
undertakings that were acquired by the Group. Deferred consideration is measured at its fair value based on the 
discounted expected future cash flows. Deferred consideration is recognised in equity when the amount payable is for a 
fixed amount of shares at a fixed price.
Share-based payments
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value 
of the equity instruments at the grant date. The fair value excludes the effect of non market-based vesting conditions. 
Details regarding the determination of the fair value of equity-settled share-based transactions are set out in note 36. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
41 NOTES TO THE FINANCIAL STATEMENTS
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 equity instruments that will eventually vest. At 
each balance sheet date, the Group revises its estimate of the number of equity instruments expected to vest as a 
result of the effect of non market-based vesting conditions. The impact of the revision of the original estimates, if any, 
is recognised in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding 
adjustment to the equity-settled employee benefits reserve.
Cash and cash equivalents
For the purposes of the cash flow statement, cash and cash equivalents include cash in hand, deposits held at call with 
banks, and other short-term highly liquid investments that are readily convertible to known amounts of cash and which 
are subject to an insignificant risk of change in value. Such investments are normally those with original maturities of 
three months or less and bank overdrafts. Cash and cash equivalents are stated net of the bank overdraft.
6.  Critical accounting judgements and key sources of estimation uncertainty
In the application of the Group’s accounting policies, which are described in note 5, the Directors are required to make 
judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent 
from other sources. The estimates and associated assumptions are based on historical experience and other factors that 
are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are 
recognised in the year in which the estimate is revised if the revision affects only that year or in the year of the revision 
and future years if the revision affects both current and future years.
Critical judgements in applying the Group and Company’s accounting policies
The following are the critical judgements that the Directors have made in the process of applying the Group’s 
accounting policies and that has the most significant effect on the amounts recognised in financial statements.
Share based payments – The calculation of the fair value of share based payments requires assumptions to be made 
regarding market conditions and future events. These assumptions are based on historic knowledge and industry 
standards. Changes to the assumptions used would materially impact the charge to the Statement of Comprehensive 
Income. Details of the assumptions are set out in note 36.
Goodwill and intangible assets – The amount of goodwill initially recognised as a result of a business combination 
is dependent on the allocation of the purchase price to the fair value of the identifiable assets acquired and the 
liabilities assumed. The determination of the fair value of the assets and liabilities is based, to a considerable extent, on 
management’s judgement.
Goodwill is reviewed annually for impairment by comparing the carrying amount of the CGUs to their expected 
recoverable amount, estimated on a value-in-use basis.
The Group makes estimates as to the expected duration of client relationships to determine the period over which 
related intangible assets are amortised. The amortisation period is estimated with reference to historical data on account 
closure rates and expectations for the future. During the year, client relationships were amortised over a 10-20 year 
period.
Convertible loan note – The amount of the convertible loan note that is classified as a liability in the financial statements 
has been adjusted to reflect its fair value. This involves calculating the amount of the loan that relates to liabilities and 
the amount that relates to equity through applying an effective interest rate. 
This effective interest rate is an estimate based on the directors’ industry knowledge of rates for similar loans without the 
conversion element. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
42 NOTES TO THE FINANCIAL STATEMENTS
7. Business and geographical segments
Products and services from which reportable segments derive their revenues
Information reported to the Group’s Executive Chairman for the purposes of resource allocation and assessment of 
segment performance is focussed on the category of customer for each type of activity. 
The Group’s reportable segments under IFRS 8 are as follows:
•  Investment management; and
•  Financial planning
Information regarding the Group’s operating segments is reported opposite. 
Segment revenues and results
The following is an analysis of the Group’s revenue and results by reportable segment for the year to 31 December 
2016. The table below details full year’s worth of revenue and results for the principal business divisions, which has then 
reconciled to the results included in the Statement of Comprehensive Income:
Investment 
Management 
2016 
£’000
Financial 
Planning 
2016 
£’000
Consolidated 
2016 
£’000
Revenue
External sales – presents full year 6,084 3,328 9,412
Result
Segment EBITDA – presents full year 1,474 625 2,099
Central administrative expenses – presents full year (1,915)
Operating result of trading segments 184
Other gains and losses 195
Finance costs (568)
Forex (32)
Share based payments (2)
Amortisation and depreciation (538)
Loss before tax (761)
Tax 4
Loss after tax (757) EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
43 NOTES TO THE FINANCIAL STATEMENTS
The following is an analysis of the Group’s revenue and results by reportable segment for the year to 31 December 
2015. The table below details full year’s worth of revenue and results for the principal business divisions, which has then 
reconciled to the results included in the Statement of Comprehensive Income:
Investment 
Management 
2015 
£’000
Financial 
Planning 2015 
£’000
Consolidated 
2015 
£’000
Revenue
External sales – presents full year 4,562 3,091 7,653
Result
Segment result – presents full year 373 491 864
Central administrative expenses – presents full year (1,661)
Operating result of trading segments (797)
Other gains and losses 719
Finance costs (509)
Forex 15
Share based payments (6)
Amortisation and depreciation (424)
Loss before tax (1,002)
Tax 11
Loss after tax (991)
8. Loss for the year
Loss for year ended 31 December 2016 has been arrived at after charging:
2016
£’000
2015
£’000
Depreciation of fixtures and equipment 43 39
Amortisation of intangibles 495 385
Operating lease – property and equipment 314 39
Staff costs 5,507 4,943
See Directors’ remuneration report for details of Directors’ remuneration during the year. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
44 NOTES TO THE FINANCIAL STATEMENTS
9. Auditor’s remuneration
The analysis of auditor’s remuneration is as follows:
2016 
£’000
2015 
£’000
Fees payable to the Group’s auditor
Audit of Company 24 15
Audit of Subsidiaries 29 42
Total audit fees 53 57
Taxation fees 10 26
Client money reporting fees 27 21
Total non-audit fees 37 47
10. Staff costs
The average monthly number of employees (including Executive Directors, but excluding self employed advisers) from 1 
January 2016 to 31 December 2016:
2016 2015
Investment management and financial planning 36 33
Administration 47 37
Average number of employees 83 70
Their aggregate remuneration comprised:
2016 
£’000
2015 
£’000
Wages and salaries 4,819 4,019
Social security costs 365 378
Other pension costs 247 223
Other benefits 74 317
Share based payments 2 6
Total Staff Costs 5,507 4,943
11. Other gains and losses
2016 
£’000
2015 
£’000
Movements in deferred consideration 194 719
The deferred consideration adjustments relate to a reduction in fair value of the deferred consideration amounts 
recognised in respect of the ISM and Bells acquisitions. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
45 NOTES TO THE FINANCIAL STATEMENTS
12. Finance costs
2016 
£’000
2015 
£’000
Bank and other finance charges 568 509
13. Taxation
2016 
£’000
2015 
£’000
Corporation tax
Current year – –
Adjustments in respect of prior years (4) (11)
(4) (11)
Movement in Deferred tax (note 20) – –
(4) (11)
UK corporation tax is calculated at 20% (2015: 20.25%) of the estimated assessable profits for the year. The standard 
rate of UK corporation tax was reduced to 20% with effect from 1 April 2015. 
2016 
£’000
2015 
£’000
Loss before tax on continuing operations (761) (1,002)
Tax at the UK corporation tax rate of 20% (2015: 20.25%) (152) (203)
Expenses not deductible for tax purposes 75 49
Adjustments for balance sheet items 108 98
Revenue not eligible for tax purposes (8) (145)
Unrelieved tax losses carried forward (23) 201
Tax charge on profits ineligible for Group relief (4) (11)
Total tax charge for the year (4) (11)
14. Dividends
The Directors are not proposing to pay a dividend in respect of the year ended 31 December 2016 (year ended 31 
December 2015: same). EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
46 NOTES TO THE FINANCIAL STATEMENTS
15. Earnings per share
2016 
£’000
2015 
£’000
Losses for the purposes of basic loss per share being net loss attributable to 
owners of the Group
(757) (991)
Number of shares
Weighted average number of ordinary shares for the purposes of basic loss 
per share
23,963,676 21,625,149
Effect of dilutive potential ordinary shares:
Share options 670,482 274,500
Convertible loan notes in issue 4,166,250 4,166,250
Weighted average number of ordinary shares for the purposes of 
diluted loss per share
28,800,408 26,065,899
The loss per share is (0.03p) (2015: loss per share 0.05p). The diluted loss per share is (0.03)p (2015: loss per share 
0.04p).
16. Fixtures & equipment
Group
Fixtures and 
equipment 
£’000
Company
Fixtures and 
equipment 
£’000
Cost 
At 1 January 2016 235 –
Additions 32 –
At 31 December 2016 267 –
Accumulated depreciation 
At 1 January 2016 65 –
Charge for the year 43 –
At 31 December 2016 108 –
Net Book Value as at 31 December 2015 170 –
Net Book Value as at 31 December 2016 159 – EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
47 NOTES TO THE FINANCIAL STATEMENTS
17. Business combinations
During the period under review, the Group completed three acquisitions.
On 13 January 2016, EFP acquired the client list of Phoenix Invest Limited. The entire purchase price will be recognised 
as intangible assets due to EFP considering that due to the acquisition being purely of the client bank, the full 
consideration relates to assets that can be classed as intangibles under IFRS. Total consideration for the acquisition is 
£268,000 which is payable in four annual instalments with the final amount being payable in December 2018.
On 21 September 2016, EWG completed the acquisition of CIMCO Partners Management Limited, (“CIMCO”) which 
manages the G20 Absolute Return fund which is based in Gibraltar for a maximum consideration of £750,000. CIMCO 
currently has approximately US$22m of funds under management. The initial consideration of £500,000 was satisfied on 
completion and with the issue of 909,091 of new ordinary shares of 5 pence each at a price of 55p. There is, depending 
on the gross profitability of CIMCO, further deferred consideration which may become payable approximately 12 months 
after completion of up to a maximum of £250,000, also to be satisfied by the issue of further new Ordinary Shares.
On 7 October 2016, EWG acquired a book of business and certain related assets from Towry Asset Management Limited 
for a total maximum consideration of £1.0m. The assets under management (“AUM”) attributable to the Transferring 
Assets were approximately £80m-£100m as at 31 March 2016. For the full year to 31 March 2016, profit attributable 
to the Transferring Assets was approximately £0.2m. The aggregate maximum consideration for the Acquisition is 
£1.0m. The first installment of the Consideration of £150,000 is payable in cash six months after completion; the second 
installment of the consideration of £400,000 is payable 12 months after completion; and the final installment, up to 
a maximum of £450,000, is payable in cash depending on the AUM attributing of the Transferring Assets. The final 
installment will be paid no earlier than 18 months after (but including) the date of completion. The maximum contingent 
consideration of £450,000 is based on £120m of transferable assets, while the minimum contingent consideration of 
£60,000 is based on £60m of transferable assets. If assets transferred are between £60m and £120, the contingent 
consideration will be prorated accordingly.
18. Intangible assets and goodwill
Group
Goodwill 
£’000
Intangibles 
£’000
Total 
£’000
Cost
As at 1 January 2015 15,617 6,972 22,589
Additions 505 2,214 2,719
As at 31 December 2015 16,122 9,186 25,308
Additions 335 1,360 1,695
As at 31 December 2016 16,457 10,546 27,003
Accumulated amortisation
As at 1 January 2015 – 180 180
Charge for year – 384 384
As at 31 December 2015 – 564 564
Charge for year – 495 495
As at 31 December 2016 – 1,059 1,059
Net book value
As at 31 December 2015 16,122 8,622 24,744
As at 31 December 2016 16,457 9,487 25,944 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
48 NOTES TO THE FINANCIAL STATEMENTS
Acquisition of client list of Phoenix Invest Limited
On 13 January 2016, European Financial Planning Limited acquired the full client list of Phoenix Invest Limited.
Phoenix Invest Limited is a financial planning business with £20m of funds under influence.
£’000
Financial assets
Identifiable intangible assets – client list and funds under influence 268
Total expected consideration 268
Satisfied by:
Deferred cash consideration 268
Acquisition of CIMCO Partners Management Limited, (“CIMCO”)
On 21 September 2016, EWG acquired CIMCO Partners Management Limited, (“CIMCO”) which manages the 
Gibraltar-based G20 Absolute Return fund for a maximum consideration of £750,000.
CIMCO clients accounted for approximately US$22m of funds under management.
£’000
Financial assets
Net Assets 31
Identifiable intangible assets 384
Total identifiable assets 415
Goodwill 335
Total expected consideration 750
Satisfied by:
Ordinary shares of European Wealth Group Limited 500
Deferred ordinary shares of European Wealth Group Limited 250
Goodwill and Intangible assets acquired 750
Pre-acquisition financial details of the companies acquired are as follows:
Company
Date of latest pre-acquisition 
audited accounts
Revenue
(US$’000)
Pre tax profit
(US$’000)
Net assets
(US$’000)
CIMCO 30 June 2016 406 14 31 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
49 NOTES TO THE FINANCIAL STATEMENTS
Acquisition of book of business from Towry
On 7 October 2016, EWG acquired a book of business and certain related assets from Towry Asset Management 
Limited for a total maximum consideration of £1.0m. 
The AUM attributable to the Transferring Assets were approximately £100m as at 31 March 2016. For the full year 
to 31 March 2016, profit attributable to the Transferring Assets was approximately £0.2m. The aggregate maximum 
consideration for the acquisition is £1.0m.
£’000
Financial assets
Identifiable intangible assets – client list and funds under influence 708
Total expected consideration 708
Satisfied by:
Deferred cash consideration 708
Goodwill
Goodwill acquired in a business combination is allocated at acquisition to the CGUs that are expected to benefit from 
that business combination. The Group has identified two CGUs: investment management and financial planning. 
Investment 
Management 
£’000
Financial 
Planning 
£’000
Total 
£’000
Goodwill 10,850 5,607 16,457
A CGU is defined as the smallest identifiable group of assets that generates cash inflows that are largely independent 
of the cash inflows from other assets or groups of asset. The smallest identifiable group of assets in European Wealth 
are the two divisions that the business is analysed across, being investment management and financial planning. All key 
management information is divided across these two divisions and when acquisitions are made they are analysed in 
either of those divisions. The different groups of assets that are within those two divisions do not generate independent 
cashflows that would enable them to be classed as separate CGUs. This is the fourth year in which the CGUs have been 
analysed in this format.
The Company acquired European Wealth Management Group Limited (“EWMG”) in 2014. EWMG has been split 
between the two CGUs depending on which CGU the relevant assets are allocated to by the internal management 
information. The Phoenix investment has been allocated to the financial planning CGU. CIMCO and Towry acquisitions 
were allocated to the investment management CGU. 
The Group tests, for each CGU, at least annually for goodwill impairment. The recoverable amount of a CGU is 
determined as the higher of fair value less costs to sell of the value in use. For both CGUs the fair value less costs to sell 
is greater than the carrying value and therefore no further assessment of value in use has been performed. 
Valuations are based on an assets under management multiple (the investment management CGU) and recurring 
revenue multiple (financial planning CGU) and look at industry standard valuation metrics in order to analyse out the 
individual CGUs. Neither CGU valuation indicates an impairment of goodwill would be necessary as at 31 December 
2016. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
50 NOTES TO THE FINANCIAL STATEMENTS
Intangible assets
Intangible assets are valued using the value applied to the assets under management (i.e. the client lists). The assets 
are assessed for their useful life on an asset by asset basis in order to determine amortisation rates. There are currently 
£8.0m of intangible assets being amortised over 20 years, £1.2m over 15 years, £0.2m over 10 years and £0.3m have 
been assessed to have an infinite useful life. The assets assessed to have an indefinite useful life represent institutional 
clients with an indefinite lifespan.
The additions to Group intangible assets outlined in the table on page 54 represent the value of the funds under 
management acquired and client base acquired as part of the acquisitions of Towry, CIMCO and Phoenix Invest Limited.
Company £’000
Cost 
As at 1 January and 31 December 2015 –
Additions 708
At 31 December 2016 708
Amortisation 
As at 1 January and 31 December 2015 –
Charge for the year 10
At 31 December 2016 10
Net book value as at 31 December 2015 –
Net book value as at 31 December 2016 698
The above addition to the Company intangible assets represents the value of the funds under management acquired 
and client base acquired as part of the acquisitions of Towry.
19. Investments
Group 
£’000
Company 
£’000
Cost
At 1 January 2015 13 16,239
Acquired – 2,044
As at 31 December 2015 13 18,373
Acquired – 750
Impairment – (2,044)
As at 31 December 2016 13 17,079
The amount recognised as an investment in the Company accounts represents the purchase price of the acquisitions of 
CIMCO and Towry detailed in note 18. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
51 NOTES TO THE FINANCIAL STATEMENTS
20. Deferred tax asset
The following are the major deferred tax liabilities and assets recognised by the group and movements thereon during 
the current year and prior reporting year.
Group 
£’000
Company 
£’000
At 1 January 2016 428 –
Acquired – –
As at 31 December 2016 428 –
Deferred tax assets and liabilities may only be offset where the Group has a legally enforceable right to do so. 
The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Group Company
31 December 
2016 
£’000
31 December 
2015  
£’000
31 December 
2016 
£’000
31 December 
2015 
£’000
Deferred tax assets 428 428 – –
At the balance sheet date, the Group has unused tax losses of £4.5m (2015: £4.5m) available for offset against future 
profits. A deferred tax asset of £428,000 (2015: £428,000) has been recognised as the Group expects to be able to 
restructure to utilise these losses. No deferred tax asset has been recognised in respect of the remaining tax losses as 
there is some uncertainty as to how effective the future restructuring will be. 
21. Trade and other receivables 
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Prepayments 128 119 2 2
Other debtors 225 128 2 –
Trade receivables 573 550 – –
926 797 4 2
Trade receivables disclosed above are classified as loans and receivables and are therefore measured at amortised cost. 
The Directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value. 
All trade and other receivables represent current receivables which are due within 12 months. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
52 NOTES TO THE FINANCIAL STATEMENTS
22. Subsidiaries
European Wealth Group Limited has the following subsidiaries:
Company % Ownership Nature of Business
European Wealth Management Group 
Limited (“EWMG”) (UK Company)
100% owned subsidiary Holding company
European Wealth (Switzerland) SA 
(Switzerland Company)
100% owned subsidiary Investment Management
GTI Fund Investment Ltd P&C Global 
(Cayman Company) (“GTI”)*
Fund structure – shares owned by 
P&C, controlled by Unit Holders
Fund structure
European Investment Management 
Limited (“EIM”) (UK Company)
100% owned by EWMG Investment Management
European Financial Planning Limited 
(UK Company)
100% owned by EWMG Financial planning
European Wealth Trading Limited 
(UK Company)
100% owned by EWMG Trade execution
EIM Nominees Limited 
(UK Company)
100% owned by EIM – non trading 
company
Nominee Company
XCAP Nominees Limited 
(UK Company)
100% owned subsidiary Nominee Company
EW Gibraltar Limited 
(Formerly CIMCO)
100% owned subsidiary Investment Management
* GTI is held on the balance sheet of P&C for a nominal amount. EWG has no exposure to any potential losses of GTI 
as all gains and losses are attributed to the unit holders. P&C receives management fees for providing investment 
management services to GTI. 
23. Loans receivable
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Staff Loans – – 200 –
Loans receivable from the  
EWMG Group
– – 7,391 7,153
– – 7,591 7,153
All loans were to the Company’s 100% fully owned subsidiaries, European Wealth Management Group Limited, 
European Investment Management Limited, European Wealth Trading Limited, and European Financial Planning 
Limited.  EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
53 NOTES TO THE FINANCIAL STATEMENTS
24. Cash, cash equivalents
Group Company
31 December 
2016 
£’000
31 December 
2015  
£’000
31 December 
2016 
£’000
31 December 
2015  
£’000
Cash at bank and in hand 375 179 5 1
Client money
Client money, held in segregated accounts not included in the balance sheet, was £37.4m (31 December 2015: £23.5m).
25. Trade and other payables 
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Trade payables 747 822 38 67
Intercompany – – 670 703
Accruals and other creditors 1,102 557 490 322
Deferred consideration 1,933 1,922 1,069 779
Other taxation and social 
security
337 319 – –
4,119 3,620 2,267 1,871
The Directors consider that the carrying amount of trade payables approximates to their fair value.
The deferred consideration payable is due to be paid by a mixture of cash and Ordinary shares in the Company.
26. Short term borrowings
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Short term borrowing 5,263 662 5,002 300
In August and December 2013, loans of £300,000 and £200,000, respectively of two-year non-convertible unsecured 
loans were taken out, both attracting interest at 10% p.a. The £300,000 loan has been extended by another year and is 
therefore repayable in August 2017 and is classed as short term. The £200,000 loan is repayable in December 2017 and 
is classed as current. Additional loans were obtained during the year from existing loan holders for £539,000 which are 
repayable during 2017. All loans remain outstanding as at the date of these financial statements. Additionally the CLS 
£3,963,115 is due for repayment in June 2017 and is now classed as short term. 
On 30 June 2015 European Financial Planning Ltd entered into a sterling variable rate loan facility agreement with 
Clydesdale Bank PLC for an amount of £500,000. This loan is repayable on a fully amortising basis over three years. The 
interest rate charged is 3.75% over the London interbank offered rate (“LIBOR”). EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
54 NOTES TO THE FINANCIAL STATEMENTS
On 20 September 2015 European Financial Planning Ltd entered into a sterling variable rate loan facility agreement with 
Clydesdale Bank PLC for an amount of £150,000. This loan is repayable on a fully amortising basis over three years. The 
interest rate charged is 3.75% over LIBOR.
Of the two combined amounts, as at 31 December 2016, £347,878 was outstanding of which £220,691 is repayable 
within 12 months. The balance of £127,187 is recognised in non-current liabilities. 
Additionally, on 24 October 2014 John Morton loaned EWMG £100,000. The loan was made at an interest rate of 0% 
and is repayable at the Company’s discretion. As at the year-end £40,000 remains outstanding (2015: £40,000) and is 
now deemed repayable within one year.
27. Convertible loan note
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Convertible loan note – all due 
between 1-5 years
– 3,963 – 3,963
On 7 May 2014 as part of the acquisition of EWMG, £5,750,390 worth of convertible loan notes (“CLS”) were issued. 
The CLS is available in individual units worth £10 and CLS attracts a coupon rate of 10% per annum payable half yearly. 
The CLS has stepped conversion terms, which along with all other terms, are detailed in the Admission Document which 
is available on the Company’s website.
On the first conversion date in November 2014, 222,789 CLS units (representing £2,227,890 in nominal amount) 
converted into Ordinary shares in the Company at a price of 72 pence per share.
In December 2014, a further 70,625 CLS units (representing £706,250 in nominal amount) were issued in respect of 
deferred consideration due to Mr Peter Mullins pursuant to the agreement for the acquisition of Bradley Stuart, dated 18 
October 2012.
In June 2015, a further 6,250 CLS units (representing £62,500 in nominal amount) converted into Ordinary shares in the 
Company at a price of 85 pence per share. 
As a result, there are currently 416,625 CLS units in issue (representing £4,166,250 in nominal amount). Of this total 
amount £203,135 has been taken to the capital reserves in accordance with IAS 32. This is based on an assumed 
effective interest rate of 12% per annum. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
55 NOTES TO THE FINANCIAL STATEMENTS
28. Other non-current liabilities
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Directors loan (note 26/37) – 90 – –
Other Loans 127 548 – 200
Hire purchase creditor 32 51 – –
Deferred consideration 459 119 309 –
618 808 309 200
29. Share capital
Share capital 
£’000
Authorised, allotted, issued and fully paid:
As at January 2015:
19.8 million ordinary shares of £0.05 each 983
Issue of shares 188
As at 31 December 2015
23.4 million ordinary shares of £0.05 each 1,171
Issue of shares 99
As at 31 December 2016
25.4 million ordinary shares of £0.05 each 1,270
On 2 June 2015, the Company issued 73,529 ordinary shares of 5p each at an issue price of 85p per share as a result of 
the conversion of 6,250 convertible loan note units (representing £62,500 in nominal amount).
On 12 June 2015, the Company announced the completion of a placing of 2,527,095 ordinary shares of 5p each at an 
issue price of to 80p per share to raise approximately £2.0m.
On 22 June 2015 as part of the deferred consideration for Bradley Stuart, 43,502 ordinary shares of 5p each were issued 
to Mr Peter Mullins at a price of 88.5p per share.
On 1 July 2015, the Company issued 706,214 ordinary shares of 5p each at an issue price of 88.5p per share as part of 
the consideration for the acquisition of ISM.
On 1 July 2015, the Company issued 53,333 ordinary shares of 5p each at an issue price of 84p per share as part of the 
consideration for the acquisition of Bells.
On 11 December 2015 following the calculation of the deferred consideration payable to Bruce Albrecht and Iain Little, 
the vendors of European Wealth (Switzerland) SA (formerly known as P&C Global Wealth Managers SA) (the “Vendors”), 
a further 234,184 ordinary shares of 0.5p each in the Company were issued to the Vendors in equal amounts at a price 
of 104.9p. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
56 NOTES TO THE FINANCIAL STATEMENTS
On 13 September 2016, the Company issued 909,091 ordinary shares of 5p each at an issue price of 55p per share as 
part of the consideration for the acquisition of CIMCO.
On 13 September 2016, the Company issued 454,545 ordinary shares of 5p each at an issue price of 55p per share to 
Mr Michael Mechas.
On 7 October 2016, the Company announced the completion of a placing of 412,144 ordinary shares of 5p each at an 
issue price of 50p per share to raise £291,100.
30. Share premium account
Group and 
Company 
£’000
Balance at 1 January 2015 9,851
Premium arising on issue of equity shares 2,893
Transaction costs associated with the issue of shares (90)
Balance at 31 December 2015 12,654
Premium arising on issue of equity shares 942
Balance at 31 December 2016 13,596
31. Capital reserve
Group and 
Company 
£’000
Balance at 1 January 2015 1,719
Reversal of deferred consideration paid in period (1,374)
Transaction costs associated with the issue of shares –
Share based payments charge 6
Balance at 31 December 2015 351
Deferred share capital 250
Share based payments charge 2
Balance at 31 December 2016 603 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
57 NOTES TO THE FINANCIAL STATEMENTS
32. Foreign exchange reserve
Group 
£’000
Balance at 1 January and 31 December 2015 –
Exchange differences arising on translating of foreign operations 30
Balance at 31 December 2016 30
Exchange difference relating to the translation of the results and net assets of the Group’s foreign operation from their 
functional currencies to the Group‘s presentation currency are recognised directly in other comprehensive income and 
accumulated in the foreign currency reserve.
33. Retained earnings
In the year to 31 December 2016 the Company made a (loss)/profit after tax of (£2,688,000) (2015: £451,000).
Group 
£’000
Company 
£’000
Balance at 1 January 2015 4,093 4,563
Net (loss)/profit for the year (991) 451
Balance at 31 December 2015 3,102 5,019
Net (loss)/profit for the year (756) (2,688)
As at 31 December 2016 2,346 2,331 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
58 NOTES TO THE FINANCIAL STATEMENTS
34. Notes to the cash flow statement
Cash and cash equivalents comprise cash and cash equivalents with an original maturity of three months or less. The 
carrying amount of these assets is approximately equal to their fair value. Cash and cash equivalents are detailed in note 
24.
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
(Loss)/profit for the year (757) (991) (2,688) 451
Adjustments for:
Finance costs 568 509 487 448
Forex 31 (15) 29 -
Tax charge (4) (11) - -
Depreciation and amortisation 538 424 10 -
Share-based payment expense 2 6 2 6
Profit on disposal of subsidiary - - 41 -
Impairment of subsidiaries - - 2,044 -
Exceptional items (218) - (109) -
Movements in deferred 
consideration
(536) (719) (599) (1,128)
Operating cash flows before 
movements in working capital
(376) (797) (783) (223)
Decrease/(Increase) in 
receivables
(128) (82) (441) 1
Decrease/(Increase) in payables 597 (193) 645 (323)
Net cash In/(out)flow from 
operating activities
93 (1,072) (579) (545) EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
59 NOTES TO THE FINANCIAL STATEMENTS
35. Operating lease arrangements
At the balance sheet date, the group had outstanding commitments for future minimum lease payments under non-
cancellable operating leases, which fall due as follows:
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Minimum lease payments under 
operating leases recognised as 
an expense in the year
314 39 – –
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Within one year 244 39 – –
In the second to fifth years 
inclusive
135 71 – –
379 110 – –
Operating lease payments represent rentals payable by the group across its offices. Leases are generally negotiated for 
an average term of five years. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
60 NOTES TO THE FINANCIAL STATEMENTS
36. Share based payments
The Group has one share option scheme established for the Group’s employees or consultants (as appropriate):
•  The European Wealth Group Limited EMI Scheme 2014, an HMRC approved scheme under Schedule 4 of the 
Income Tax (Earnings and Pensions) Act 2003 pursuant to which options over ordinary shares of the Group may be 
granted to individuals (as selected by and in amounts determined by the Group’s Remuneration Committee) who are 
employees of the Company or of other members of its group.
If options granted under any of the schemes remain unexercised for a period of 10 years from the date of grant then the 
options expire.
In certain circumstances, options may be exercised earlier than the vesting date if the option holder ceases to be an 
employee of the relevant Group member. In particular, options may be exercised for a period of six months after the 
option holder ceases to be employed within the Group by reason of injury, ill health or disability (evidenced to the 
satisfaction of the Remuneration Committee), redundancy or retirement on or after reaching the age of 55 or upon the 
sale or transfer out of the Group of the relevant Group member or undertaking employing or contracting with him/her. 
In the event of cessation of employment or engagement of the option holder by reason of his/her death, his/her 
personal representatives will be entitled to exercise the option within twelve months following the date of his/her 
death. Where an option holder ceases to be employed within the group for any other reason, options may also become 
exercisable for a limited period at the discretion of the Remuneration Committee. There are no additional performance 
conditions attached to the share options presently issued.
Number of  
share options
Outstanding at 1 January 2015 and 31 December 2015 1,130,440
Issued during the year 297,500
Lapsed during year (75,000)
Outstanding at the end of the year 1,352,940
Exercisable at 31 December 2016 1,352,940
The Company has adopted the provisions of IFRS 2 as regards share-based payment charges. These provisions require 
a calculation of the fair value at the date of grant of share options granted to directors and employees. This fair value 
is then charged to the income statement over the vesting period of three years of the options, and is based on an 
expected number of employees leaving before their options vest. The fair value is calculated using a variant of the Black 
Scholes model.
The options outstanding at 31 December 2016 had a weighted average exercise price of approximately £0.39 (2015: 
£0.39) and a weighted average remaining contractual life of approximately 8 years (2015: 8 years). EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
61 NOTES TO THE FINANCIAL STATEMENTS
The inputs into the Black-Scholes model are as follows:
31 December 
2016
31 December 
2015
Weighted average exercise price £0.39 £0.39
Range of exercise price £1-£0.01 £1-£0.01
Expected volatility 11.6% 2%
Expected life 8 Years 8 Years
Risk-free rate 0.79% 0.56%
Expected dividend yields 0% 0%
Volatility has been estimated on the basis of the Company’s historical share price since the reverse takeover in May 
2014.
The charge to the Statement of Comprehensive Income in the period was £2,144 (2015: £5,759).
37. Financial instruments
The following table states the classification of financial instruments and is reconciled to the balance sheet:
Loans and 
receivables 
£’000
Held for 
trading 
£’000
Amortised 
cost 
£’000
Non-financial 
instruments 
£’000
Total 
£’000
Fixtures and equipment – – – 159 159
Intangible assets and 
goodwill*
– – 25,944 – 25,944
Deferred tax asset – – – 428 428
Trade and other 
receivables
901 – – 25 926
Investments – 13 – – 13
Cash and bank balances 375 – – – 375
Trade and other payables – – (3,782) (337) (4,119)
Short term borrowing – – (5,263) – (5,263)
Long term borrowing – – (159) – (159)
Other non-current 
liabilities
– – (459) – (459)
As at 31 December 2016 1,276 13 16,281 275 17,845
*Non-financial instrument EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
62 NOTES TO THE FINANCIAL STATEMENTS
Loans and 
receivables 
£’000
Held for  
trading 
£’000
Amortised 
cost 
£’000
Non-financial 
instruments 
£’000
Total 
£’000
Fixtures and equipment – – – 170 170
Intangible assets  
and goodwill*
– – 24,744 – 24,744
Deferred tax asset – – – 428 428
Trade and  
other receivables
787 – – 10 797
Investments – 13 – – 13
Cash and bank balances 179 – – – 179
Trade and other payables – – (3,301) (319) (3,620)
Short term borrowing – – (662) – (662)
Long term borrowing – – (3,963) – (3,963)
Other non-current  
liabilities
– – (808) – (808)
As at 31 December 2015 966 13 16,010 289 17,278
The held for trading assets are Level 3 fair value and is the only fair value item.
Credit Risk
Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that 
it has entered into with the Company. Credit risk is monitored on a regular basis by the finance team along with support 
from the back office functions of the respective business divisions. 
The carrying amounts of financial assets best represent the maximum credit risk exposure at the balance sheet date. 
At the reporting date, the Company’s financial assets exposed to credit risk amounted to the following:
Trade and other receivables
Group Company
31 December 
2016 
£’000
31 December  
2015  
£’000
31 December 
2016 
£’000
31 December  
2015 
£’000
Cash 375 179 5 1
Trade and other receivables 926 797 7,595 2
1,301 976 7,600 3
The Group’s exposure to credit risk on cash and bank balances is considered by the Directors to be low as the Group 
holds accounts at banks with strong credit ratings. EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
63 NOTES TO THE FINANCIAL STATEMENTS
The below table shows the ageing of due but not impaired receivables.
Delivery 
versus 
payment 
£’000
Other trade 
receivables 
£’000
Other 
receivables 
£’000
Total 
£’000
Neither impaired nor past due on reporting 
date
– 400 526 926
Past due less than 30 days – – – –
Between 30 and 60 days – – – –
Over 60 days – – – –
As at 31 December 2016 – 400 526 926
Delivery 
versus 
payment 
£’000
Other trade 
receivables 
£’000
Other 
receivables 
£’000
Total 
£’000
Cash and bank balances – 550 247 797
Short term borrowing – – – –
Trade and other receivables – – – –
Trade and other payables – – – –
As at 31 December 2015 – 550 247 797 EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
64 NOTES TO THE FINANCIAL STATEMENTS
Liquidity Risk
Liquidity risk is the risk that the Company will be unable to meet its financial obligations as they fall due. The controls 
and limits surrounding the Company’s credit risk together with cash monitoring processes ensures that liquidity risk is 
minimised. 
The below table illustrates the maturity profile of all financial liabilities outstanding as at 31 December 2016.
Repayable on 
Demand 
£’000
Repayable 
between 0 
and 6 months 
£’000
Repayable 
between 
6 and 12 
months
Repayable 
after more 
than 12 
months 
£’000
Total 
£’000
Borrowings – 4,537 689 127 5,390
Other liabilities including 
deferred consideration
– 1,467 700 258 2,425
As at 31 December 2016 – 6,041 1,389 385 7,815
Borrowings – 106 556 4,601 5,263
Other liabilities including 
deferred consideration
1,141 557 1,922 170 3,790
As at 31 December 2015 1,141 663 2,478 4,771 9,053
Of the amount due to be repaid between 0-6 months, £0.4m (2015: £0.9m) is due in share capital of the Company.
Market Risk
As with other firms in our sector, European Wealth Group Limited is vulnerable to adverse movements in the value of 
financial instruments.  65 NOTES TO THE FINANCIAL STATEMENTS
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
Interest Rate Risk
Interest rate risk is the risk of financial loss as a result of an increase in interest rates on borrowings. Sensitivity analysis 
has not been performed on the Group as all of the Group’s interest bearing instruments are at fixed rates. As such, a 
10% movement in interest rates would have an immaterial impact on the financial statements. 
The below table illustrates non-interest and interest bearing financial instruments. 
Non-interest 
bearing
£’000
Fixed interest
£’000
Non financial 
assets/
liabilities
£’000
Total
£’000
Cash and bank balances 375 – – 375
Short term borrowing – (5,263) – (5,263)
Trade and other receivables 901 – 25 926
Trade and other payables (3,782) – (337) (4,119)
As at 31 December 2016 (2,506) (5,263) (312) (8,081)
Cash and bank balances 179 – – 179
Short term borrowing – (662) – (662)
Trade and other receivables 787 – 10 797
Trade and other payables (3,301) – (319) (3,620)
As at 31 December 2015 (2,335) (662) (309) (3,306)
38. Related party transactions
Remuneration of key management personnel
The remuneration of the Directors, who are the key management personnel of the group, is set out below in aggregate 
for each of the categories specified in IAS 24 Related Party Disclosures. Further information about the remuneration of 
individual Directors is provided in the audited part of the Directors’ Remuneration Report on page 25.
31 December 
2016 
£’000
31 December 
2015 
£’000
Short-term employee benefits 656 464
Post-employment benefits 59 45
Share-based payments 2 –
717 509
During the year ended 31 December 2016, European Investment Management charged fees totalling £6,089 (2015: 
£7,267) to related parties who have assets managed by European Investment Management. In addition, European 
Wealth Trading Limited charged commission on trades for related parties of £3,141 (2015: £11,723). This cash was 
managed at the standard rate for staff and related parties. 
On 24 October 2014 John Morton loaned EWMG £100,000. The loan was made at an interest rate of 0% and is 
repayable at the Company’s discretion. As at the year-end £40,000 remains outstanding (2015: £40,000 each). 66 NOTES TO FINANCIAL STATEMENTS
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016
66
39. Capital Management
The primary objective of the Company’s capital management is to ensure that it maintains a strong capital structure in 
order to support the development of its business, to maximise shareholder value and to provide benefits for its other 
stakeholders. Details of the management of this risk can be found in the strategic report and the directors’ report.
In addition European Investment Management, European Wealth Trading and European Financial Planning are 
regulated by the FCA and have to comply with the FCA capital adequacy rules and regulations.
40. Ultimate Controlling Party
The directors do not consider there to be an ultimate controlling party for the Company.
41. Post Balance Sheet Events
On 22 June 2017, the Company raised £9.3m through a share placing. Refer to the Chairman’s Statement and Group 
Chief Executive’s Report for further details 67 SECTION HEADING 68 SECTION HEADING
EUROPEAN WEALTH GROUP ANNUAL REPORT AND ACCOUNTS 2016  European Wealth is a trading style of European Investment Management Limited (registered 
number 06931664) which is incorporated and registered in England and Wales with registered 
office at Ellenborough House, Wellington Street, Cheltenham, Gloucestershire GL50 1YD 
and authorised and regulated by the Financial Conduct Authority. This document is not 
to be construed as a solicitation or offer to buy or sell securities and does not in any way 
constitute investment advice, nor should it be used as the basis for any investment decision. 
The information contained in this document has been prepared using all reasonable care. 
However, it is not guaranteed as to its accuracy, and it is published solely for information 
purposes. Our opinions are subject to change without notice and we are not under any 
obligation to update or keep this information current. The investments discussed in this 
document may not be suitable for all investors. European Wealth does not guarantee the 
performance of any investments. Past performance is not necessarily a guide to future 
performance. The value of investments may go up or down and you may not get back the 
amount you have invested. The income from an investment is not fixed and may fluctuate. 
The value of an investment involving exposure to foreign currencies can be affected by 
exchange rate movements which may cause the value of the investment to go up or down. 
European Wealth and/or its affiliated companies and/or their employees may, from time to 
time, hold shares or holdings in the securities discussed in this message and may as agent 
buy or sell those securities. This document is not, and under no circumstances is to be 
construed as, an advertisement, or any other step in furtherance of a public offering of shares 
in the United States or Canada. This document is not aimed at persons who are resident in 
the United States, Canada or any province or territory thereof.
EUROPEAN WEALTH
10-11 Austin Friars 
London EC2N 2HG
Telephone 020 7293 0730
www.europeanwealth.com
EUROPEAN  
WEALTH GROUP 
LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2016
REGISTERED NUMBER: 42316
Protect and grow your wealth