Orient Express Finance Designated Activity Company ......2020/01/14 · Orient Express Finance Designated Activity Company Directors and other information 1 Directors' report 2-3

Orient Express Finance Designated Activity Company

Directors' report and audited financial statements

For the financial year ended 31 December 2018

Registered Number: 439259


Directors and other information 1

Directors' report 2-3

Directors' responsibility statement 4

Independent auditors' report 5-7

Statement of comprehensive income 8

Statement of financial position 9

Statement of changes in equity 10

Statement of cash flows 11

Contents Page (s)

Notes to the financial statements 12-19


Directors and other information

Directors

Registered Office

Administrator and Company Secretary

Solicitor

Banker

Auditor

Eimir McGrathShengjie Xu (appointed on 23 March 2018) Bianca Schwarze (resigned on 23 March 2018)

(As from 12 August 2018)First Floor,Block A,George's Quay Plaza,Dublin 2 Ireland

(As from 12 August 2018)Vistra Alternative Investments (Ireland) Limited Block A

George's Quay Plaza George's Quay Dublin 2 Ireland

Arthur Cox Earlsfort Centre Dublin 2 Ireland

BNY Corporate Trustee Services Limited40th Floor, One Canada SquareLondonE14 5ALUnited Kingdom

Moore Stephens Ulysses House Foley Street Dublin 1 Ireland

(Up to 12 August 2018) Pinnacle 2Eastpoint Business ParkDublin 3Ireland

(Up to 12 August 2018)Deutsche International Corporate Services (Ireland) Limited Pinnacle 2Eastpoint Business ParkDublin 3Ireland


Directors' reportThe Directors present the annual report and audited financial statements of Orient Express Finance Designated Activity Company (the “Company”) for the financial year ended 31 December 2018,

Principal activities and business reviewThe Company is organised as a special purpose company. On 15 August 2016, the Company changed it's name to Orient Express Finance Designated Activity Company, It was established to raise capital by the issue of debt securities and to use an amount equal to the proceeds of such issuances to make loans to the Public Joint-Stock Company "Orient Express Bank” (“Orient Express Bank”) (formerly known as OJSC "Orient Express Bank”). The Company has entered into loan participation note transactions whereby the Company has initially issued an aggregate principal amount of USD 43,000,000 11 per cent. Step Up Loan Participation Notes due 2017 (the “Dollar Notes”) for the sole purpose of financing a USD loan to Orient Express Bank on the terms of a USD loan agreement between the Company and Orient Express Bank.

The USD 43,000,000 11 per cent. Step Up Loan Participation Notes due 2017 matured on 27 June 2017 and there was no further issuance till the year end.

Financial risk managementThe main risks in respect of the Company’s financial instruments are mitigated by the arrangements set out in note 17 of the financial statements.

Results and dividends for the financial yearThe results for the financial year are set out on page 8. The Directors do not recommend the payment of a dividend (2017: USD nil).

Business review During the financial year:

The Company made no profit or loss (2017: USD nil);The Company’s total indebtedness was USD 32,711 (2017: USD 14,252);Net income on loans and receivables amounted was USD nil for the curent year (2017: USD 1,717,516);Net finance expenses on debt securities issued was USD nil for the current year (2017: USD 1,717,516),

Future development and going concernThe directors are of the opinion that the Company will be liquidated in tire foreseeable future. However, tire exact date of tire liquidation has not yet been determined. Thus, the directors do not consider the Company to be a going concern. These financial statements are prepared on a liquidation basis of accounting where all assets are stated at their net realisable amounts.

Changes in Directors, secretary and registered officeOn 23 March 2018, Bianca Schwarze resigned as Director of the Company and was replaced by Shengjie Xu on the same date.

Deutsche International Corporate Services (Ireland) Limited (“DICSIL”) agreed to sell its corporate services business to Vistra Alternative Investments (Ireland) Limited (“VAIIL”) pursuant to a business transfer agreement dated 14 September 2017. As part of the sale, the rights and obligations of DICSIL under tire corporate services agreement entered into between the Company and DICSIL were novated to VAIIL pursuant to a Deed of Novation dated 12 August 2018. In connection with the novation, DICSIL resigned as secretary of the Company and VAIIL was appointed as the new secretary of the Company with effect from 12 August 2018. The registered office of the Company also changed from Pinnacle 2, Eastpoint Business Park, Clontarf, Dublin 3 to Block A, George’s Quay Plaza, George's Quay, Dublin 2 with effect from 12 August 2018.

There were no other changes in Directors, secretary and registered office during the financial year and up to the date of signing the financial statements.

Directors, secretary and their interestsAt 31 December 2018, Vistra Capital Markets (Ireland) Limited (VCMIL) held one share of the Company in trust for charity under the terms of a declaration of trust dated 17 May 2007. The Directors and secretary who held office on 31 December 2018 did not hold any shares in the Company at that date, or during the financial year.

Accounting recordsThe Directors believe that they have complied with the requirements of Section 281 to 285 of the Companies Act 2014, adequate accounting records are kept by employing accounting personnel with the appropriate expertise and by providing adequate resources to the financial function. The accounting records of the Company are maintained at Block A, George’s Quay Plaza, George's Quay, Dublin 2, Ireland.

Audit committeeAs at the date of these financial statements, the Company is operating within the balance sheet and turnover tlireshold limits as set out under Section 167(1) of the Companies Act 2014 (the “Act”) as amended, and as such the Company does not meet the requirements to establish an audit committee for the current financial year ending 31 December 2018.

Events after the statement of financial position dateThere have been no significant subsequent events up to the date of approval of these financial statements.

Page 2


Directors' report (continued)

Statement of relevant audit informationThe Directors confirm that:(a) so far as the Directors are aware, there is no relevant audit information of which the Company's statutory auditors are unaware of; and(b) the Directors have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to

establish that the Company's statutory auditors are aware of that information.

Directors compliance statementAt this present time the Company is operating within the balance sheet and turnover threshold limits as set out under Section 225 (7) of the Companies Act 2014 (the “Act”), which enables the Company to avail of an exemption to tire Compliance Policy Statement obligations. Accordingly the Directors are not required to include a Compliance Statement in their statutory Directors’ report for the current financial year ending 31 December 2018.

AuditorsThe auditors, Moore Stephens, Chartered Accountants and Registered Auditors, have signified their willingness to continue in office in accordance with Section 383(2) of the Act.

Page 3


Directors' Responsibility Statement

Irish Company law requires the Directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Company and of the profit or loss for that financial year.

Under the Company law, the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the assets, liabilities and financial position of the Company as at the financial year end date and the profit or loss of the Company for the financial year and otherwise comply with the

In preparing those financial statements, the Directors are required to:

• select suitable accounting policies for the Company's financial statements and then apply them consistently;

• make judgements and estimates that are reasonable and prudent;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and

• state whether the financial statements have been prepared in accordance with the applicable accounting standards, and note the effect and the reasons for any material departure from those standards.

The Directors are responsible for ensuring that the Company keeps or causes to be kept adequate accounting records which correctly explain and record the transactions of tire Company, enable at any time the assets, liabilities, financial position and profit or loss of the Company to be determined with reasonable accuracy, enable them to ensure that die financial statements aid Directors' report are prepared in accordance with International Financial Reporting Standards as adopted by the European Union and comply with Irish statute comprising the Act and enable the financial statements to be audited. 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.

Page 4

On behalf of die board

Shengjie Xu Director

ORIENT EXPRESS FINANCE DESIGNATED ACTIVITY COMPANY Page 5

INDEPENDENT AUDITOR'S REPORT

TO THE MEMBERS OF ORIENT EXPRESS FINANCE DESIGNATED ACTIVITY COMPANY

OpinionWe have audited the financial statements of Orient Express Finance Designated Activity Company (the 'company') for the year ended 31 December 2018 set out on pages 7 to 14. The relevant financial reporting framework that has been applied in their preparation is the Companies Act 2014 and FRS 102 The Financial Reporting Standard applicable in the Republic of Ireland, applying Section 1A of the Standard.

In our opinion the financial statements:• give a true and fair view of the state of the company's affairs as at 31 December 2018 and of its profit

for the year then ended;• have been properly prepared in accordance with FRS 102 The Financial Reporting Standard

applicable in the Republic of Ireland, applying Section 1A of the Standard; and• have been prepared in accordance with the requirements of the Companies Act 2014.

Basis for opinionWe conducted our audit in accordance with International Standards on Auditing (Ireland) (ISAs (Ireland)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of financial statements in Ireland, including the Ethical Standard issued by the Irish Auditing and Accounting Supervisory Authority (IAASA), and we have fulfilled our other ethical responsibilities in accordance with these requirements.

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

Conclusions relating to going concernWe have nothing to report in respect of the following matters in relation to which the ISAs (Ireland) require us to report to you where:

• the director's use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

• the director has not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other informationThe director is responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.


INDEPENDENT AUDITOR'S REPORT (CONTINUED)


Opinions on other matters prescribed by the Companies Act 2014Based solely on the work undertaken in the course of the audit, we report that in our opinion:

• the information given in the director's report is consistent with the financial statements; and• the director's report has been prepared in accordance with applicable legal requirements.

We have obtained all the information and explanations which we consider necessary for the purposes of our audit.

In our opinion the accounting records of the company were sufficient to permit the financial statements to be readily and properly audited, and the financial statements are in agreement with the accounting records.

Matters on which we are required to report by exceptionBased on the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified any material misstatements in the director's report.

We have nothing to report in respect of our obligation under the Companies Act 2014 to report to you if, in our opinion, the disclosures of director's remuneration and transactions specified by sections 305 to 312 of the Act are not made.

Responsibilities of director for the financial statementsAs explained more fully in the director's responsibilities statement, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the director is responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statementsOur objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (Ireland) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the lAASA’s website at: http://www.iaasa.ie/Publications/Auditing-standards/lnternational-Standards-on-Auditing-for-use- in-lre/lnternational-Standards-on-Auditing-(lreland)/ISA-700-(lreland). This description forms part of our auditor’s report.


INDEPENDENT AUDITOR'S REPORT (CONTINUED)


The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the company’s members, as a body, in accordance with section 391 of the Companies Act 2014. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to her 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.

Cormac Reilly FCCA For and on behalf of Moore Chartered Accountants & Statutory Audit Firm Ulysses House Foley Street Dublin 1


Statement of comprehensive incomeFor the financial year ended 31 December 2018

Page 8

Financial year Financial yearended ended

31-Dec-18 31-Dec-17Note USD USD

Net income on loans and receivables 4 - 1,717,516Net finance expenses on debt securities issued 5 - (1,717,516)

Other income 6 24,807 62,256Operating expenses 7 (24,807) (62,256)

Profit on ordinary activities before taxation

Tax on profit from ordinary activities 8 - -

Profit for the financial year

Other comprehensive income

Total comprehensive income for the financial year ________________ -______________________ -

All items dealt with in arriving at the profit for the financial year ended 31 December 2018 and 2017 related to continuing operations.

The Company has no recognised gains and losses in tire financial year other than diose dealt in the Statement of comprehensive income.

The accompanying notes on pages 12 to 19 form an integral part of these financial statements


Statement of financial positionPage 9

As at 31 December 2018Note 2018 2017

USD USDCurrent assetsOther receivables 10 22,881 3,779Cash and cash equivalents 11 14,331 14,974

37,212 18,753

Current liabilitiesOther payables 14 32,711 14,252

Net current assets 4,501 4,501Net assets 4,501 4,501

EquityCalled up share capital presented as equityRetained earnings

12 14,500

14,500

Total equity 4,501 4,501

On behalf of the board

Shengjie Xu Director



Statement of changes in equityFor the financial year ended 31 December 2018

Page 10

RetainedShare Capital Earnings Total

USD USD USDBalance as at 1 January 2017 1 4,500 4,501

Profit for the financial year


Balance as at 31 December 2017 1 4,500 4,501

Profit for the financial year -


Balance as at 31 December 2018 ______________1____________ 4,500__________________ 4,501


Orient Express Finance Designated Activity Com pany

Statement of cash flowsFor the financial year ended 31 December 2018

Cash flow from operating activitiesProfit on ordinary activities before taxation (Increase)/decrease in other receivables Increase/(decrease) in other payables Interest expense Interest income

Net cash generated from operating activities

Cash flow from investing activitiesInterest income receivedNet cash generated from financing activities

Cash flows front financing activitiesInterest expense paidNet cash used in financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents at start of the financial year

Cash and cash equivalents at end of the financial year

Page 11

Note

11


31-Dec-18 31-Dec-17USD USD

(19,102) 42,37518,459 (39,405)

- 1,717,516(1,717,516)

(643) 2,970

1,717,5161,717,516

(1,717,516)(1,717,516)

(643) 2,970

14,974 12,004

14,331 14,974



Notes to the financial statementsFor the financial year ended 31 December 2018

1. General InformationOrient Express Finance Designated Activity Company (the "Company") was incorporated m Ireland as a private company with limited liability. In line with Companies Act 2014, the Company converted to a Designated Activity Company on the 15 August 2016. The address of its registered office and principal place of business are disclosed in the Directors and other information on page 1.

The Company is organised as a special purpose company. It was established to raise capital by the issue of debt securities and to use an amount equal to the proceeds of such issuances to make loans to the Public Joint-Stock Company "Orient Express Bank” (“Orient Express bank”) (formerly known as OJSC "Orient Express Bank”).

The Company has entered into loan participation note transactions whereby the Company has initially issued an aggregate principal amount of USD 43,000,000 11 per cent. Step Up Loan Participation Notes due 2017 for the sole purpose of financing a USD loan to Orient Express Bank on the terms of a USD loan agreement between the Company and Orient Express Bank. The Loan Participation Notes was listed on the Irish Stock Exchange, trading as Euronext Dublin ("ISE").

Under the Subordinated Loan Agreement entered into between Orient Express Bank and the Company on 26 June 2007, Orient Express Bank will indemnify the Company for all transactions in respect of the above-mentioned Loan Notes.


2. Basis of preparationThe financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRSs”) issued by the International Accounting Standards Board (“IASB”) as adopted by the European Union (“EU”). The financial statements are also prepared in accordance with Irish Statute, comprismg the Companies Act 2014.

The accounting policies set out below have been applied in preparing the financial statements for the financial year ended 31 December 2018, the comparative information presented in these financial statements is for financial year ended 31 December 2017.

The directors are of the opinion that the Company will be liquidated in the foreseeable future. However, the exact date of the liquidation has not yet been determined. Thus, the directors do not consider the Company to be a going concern. These financial statements are prepared on a liquidation basis of accounting where all assets are stated at their net realisable amounts.

3. Significant accounting policies(a) Basis of measurement

The financial statements have been prepared on tire historical cost basis.

(b) Use of estimates and judgementsThe preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. 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 financial period in which the estimate is revised if the revision affects only that financial period or in the financial period of the revision and future financial periods if tire revision affects both current and future financial periods.

(c) Functional and presentation currencyThese financial statements are presented in United States Dollars (USD) which is the presentational currency of tire parent Group. Tire Company’s functional currency (primary economic environment in which tire company operates) is the USD, as tire loans, other receivables and loan notes are denominated in USD. The Directors therefore believe that USD most faithfully represents tire economic effects of the underlying transactions, events and conditions.

(d) TaxationIncome tax expense comprises current and deferred tax. Income tax expense is recognised in the Statement of Comprehensive Income. Current tax is tire expected tax payable on the taxable income for the financial year, using tax rates applicable to the Company’s activities enacted or substantively enacted at the balance sheet date, and adjustment to tax payable in respect of previous financial years.

Deferred tax is provided using the statement of financial position method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used of taxation purposes. Defemed tax is not recognised for temporary differences arising on the initial recognition of assets or liabilities in a tr ansaction that is not a business combination and that affects neither accounting nor taxable profit. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to tire extent that it is no longer probable that related tax benefit will be realised.

Page 12


Notes to the financial statements (continued)For the financial year ended 31 December 2018

3. Significant accounting policies (continued)(e) Cash and cash equivalents

Cash and cash equivalents includes bank draft, cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of less than three months, which are subject to insignificant risk of changes in their fair value, and are used by the Company in the management of its short term commitments. Cash and cash equivalents are carried at amortised cost in the statement of financial position.

(f) Foreign currency transactionTransactions in foreign currencies are translated to the functional and presentational currency of the Company at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional and presentational currency at tire exchange rate at that date. Tire foreign currency gain or loss on monetary items is the difference between amortised costs in the functional currency at the beginning of the financial period, adjusted for effective interest and payments during the financial year and amortized cost in foreign currency translated at the exchange rate at the end of the financial year. Foreign currency differences arising on retranslation are recognised in the Statement of comprehensive income.

Page 13

(g) Income and expensesAll income and expenses are accounted for on an accrual basis.

(h) New standards and interpretations(i) The following new standards, amendments and interpretations issued became effective as of 1 January' 2018:

Standards/interpretations Effective date*IFRS 1: First-time Adoption of International Financial Reporting Standards 1 January 2018Amendments to IFRS 2: Classification and measurement of share-based payment transactions 1 January 2018Amendments to IFRS 4: Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts 1 January 2018IFRS 9: Financial Instruments 1 January 2018IFRS 15: Revenue from contracts with customers 1 January 2018Amendments to IAS 40: Transfers of Investment Property 1 January 2018IFRIC Interpretation 22: Foreign Currency Transactions and Advance Consideration 1 January 2018

None of the above standards, amendments and interpretations had a significant impact on tire Company’s financial statements except IFRS 9 which is detailed below.

IFRS 9: Financial Instruments (effective date: financial year beginning I January 2018)

Transition to IFRS 9 - effective 1 January 2018IFRS 9, the new financial instrument standard issued by the IASB in July 2014, replaces IAS 39, and was endorsed for adoption in the European Union on 22 November 2016. IFRS 9 has been implemented by the Company with effect from 1 January 2018, in line with the Standard’s requirements. As permitted, the Company will not restate comparative periods on initial application of IFRS 9 and will recognise any measurement difference between the previous carrying amount and the new carrying amount at the transition date, through an adjustment to opening retained earnings. The Company has reflected the application of the requirements of the new standard and related changes to other accounting standards in its financial statements as at, and from, tire adoption date.

The Company does not hold any investments and neither has any notes in issue.

Trade receivablesTrade receivables are financial instruments that typically arise from a revenue contract with a customer and the right to receive the consideration is unconditional and are receivable on demand.

As at 31 December 2018, the Company had other receivables amounting to USD 22,881 (2017: USD 3,779) which comprise of vat recoverable and other income receivables. The other receivables are short term and receivable on demand.

IFRS 9 introduces a new impairment model based on expected credit losses. This is different from IAS 39 Financial Instruments: Recognition and Measurement where an incurred loss model was used.

The complexity of the 'general approach' in IFRS 9 necessitated some simplifications for trade receivables, whereby certain accounting policy choices apply.

Accounting policy choices that are available to trade receivables:

Trade receivables that do not contain a significant financing component under IFRS 15

The 'simplified approach' would always apply.

Trade receivables that do contain a significant financing component under IFRS 15

Either the 'general approach’ or the 'simplified approach' would apply.

The Company's hade receivables do not contain a significant financing component, therefore the 'simplified approach' is used to calculate the expected credit losses. The resulting loss is not material and hence has no impact on the financial statements.



(h) New standards and interpretations (continued)

(i) The following new standards, amendments and interpretations issued became effective as of 1 January 2018 (continued)

IFRS 15: Revenue from contracts with customersGiven the nature of the Company's operations, this standard is not expected to have a pervasive impact on the Company's financial statements as the Company adopts fair value accounting in relation to all its significant financial instruments. The Directors are continuing to assess the implication of IFRS 15 on subsequent accounting periods.

(ii) Standards not yet effective, but available for early adoption

Page 14

Description Effective date*IFRS 9: Prepayment features with negative compensation 1 January 2019IFRS 16: Leases 1 January 2019IFRS 3: Business Combinations 1 January 2020**IFRS 11 Joint Arrangements 1 January 2019**IAS 1: Presentation of Financial Statements 1 January 2020**IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors 1 January 2020**IAS 12: Income Taxes 1 January 2019**IAS 19: Employee Benefits 1 January 2019**IAS 23: Borrowing Costs 1 January 2019**IAS 28 Investments in Associates and Joint Ventures 1 January 2019**IFRIC Interpretation 23: Uncertainty over Income Tax Treatments 1 January 2019

*Where new requirements are endorsed, the EU effective date is disclosed. For un-endorsed standards and interpretations, the IASB’s effective date is noted. Where any of the upcoming requirements are applicable to the Company, it will apply them from their EU effective date.

** Not endorsed.

The Directors have considered the new standards, amendments and interpretations as detailed in the above table and does not plan to adopt these standards early. The application of all of these standards, amendments or interpretations will be considered in detail in advance of a confirmed effective date by the Company. The Directors have concluded that the following may be relevant:

The Company has not adopted any other new standards or interpretations that are not mandatory. The Directors anticipate that tire adoption of those standards or interpretations will have no material impact on the financial statements of the Company in the period of initial application.

Financial year Financial yearNet income on loans and receivables ended ended


Interest and similar income - 1,717,516

Financial year Financial yearNet finance expenses on debt securities issued ended ended


Interest and similar expense - (1,717,516)

Financial year Financial yearOther income ended ended


Odrer income 24,807 28,645Amortisation of facility amount - Subordinated loans - 33,611

24,807 62,256

Financial year Financial yearOperating expenses ended ended


Administration expenses (12,041) (18,651)Audit fees (9,967) (6,002)Tax fees (1,622) (1,381)Foreign exchange loss (643) -VAT expensesAmortisation of issue costs - Subordinated loans

(534)(33,61 1)

Professional fees - (2,611)(24,807) (62,256)



7. Operating expenses (continued)The Company is administered by VAIIL and has no employees.

Pursuant to Section 305A(l)(a) of the Act (as amended), requires disclosure that VAIIL received 5.0% of administration fees as consideration for the making available of individuals to act as directors of the Company. The terms of the corporate services agreement in place between the Company and VAIIL provide for a single fee for the provision of corporate administration services (including the making available of individuals to act as Directors of the Company). As a result, tire allocation of fees between tire different services provided is a subjective and approximate calculation. The individuals acting as directors do not (and will not), in their personal capacity or any other capacity, receive any fee for acting or having acted as directors of tire Company. For tire avoidance of doubt, notwithstanding that tire directors of the Company are employees of VAIIL, they each do not receive any remuneration for acting as directors of the Company. The Company has no employees and services required are contracted from third parties.



Page 15

Audit of Company accountsOther non audit services

(9,967) (6,002)

Tax advisory servicesOther assurance services

(1,622) (1,381)

(11,589) (7,383)

Financial year Financial year8. Tax on profit from ordinary activities ended ended

31-Dec-18 31-Dec-17The Company is charged taxation at a rate of 25% (2017: 25%)Corporation tax

USD USD

9. Loans and receivables 31-Dec-18 31-Dec-17USD USD

Loans and receivables - -

31-Dec-18 31-Dec-17Movement during the financial year USD USDAt beginning of the financial year - 43,000,000Repayments during the financial year - (43,000,000)At end of the financial year - -

10. Other receivables 31-Dec-18 31-Dec-l 7USD USD

Other income receivable 19,637 -Vat recoverable 3,244 3,779

22,881 3,779Other receivables are current and receivable within one year

11. Cash and cash equivalents 31-Dec-18 31-Dec-17USD USD

Cash at bank 583 583Bank draft 13,748 14,391

14,331 14,974

12. Share capital 31-Dec-18 31-Dec-17A uthorised Capital EUR EUR100 ordinary shares of Eur 1 each 100 100

Issued and fully paid Capital USD USD1 ordinary share of Eur 1 each 1 1(converted at historical rate of €:$ 1.3578, date of issue being 17 May 2007)



Page 16

13. Debt securities issued 31-Dec-18 31-Dec-17USD USD

Notes issued - -

31-Dec-18 31-Dec-17Movement during the financial year USD USDAt beginning of the financial year - 43,000,000Repayments during the financial year - (43,000,000)At end of die financial year - -

The debt securities matured on 27 June 2017 and was repaid in full.

14. Creditors - Amount falling due within one year 31-Dec-18 31-Dec-17USD USD

Accruals 32,711 9,081Deferred income - 5,171

32,711 14,252

15. Ownership of the CompanyThe sole shareholder in die Company is VCMIL (1 share). The share is held under die terms of declarations of trust under which the relevant share trustee holds die issued share of the Company on trust for a charity. However, in view of the purpose for which the Company was formed, the Directors considered die Public Joint-Stock Company "Orient Express Bank” as the ultimate controlling parent of the Company.

16. Related party transactionsDuring die financial year the Company incurred a fee of USD 12,041 (2017: USD 18,651) relating to administration services provided by VAIIL. Both current Directors are employee of VAIIL.

17. Financial risk management Introduction and overviewThe Company is a special purpose vehicle incorporated and registered in Ireland widi limited liability. It has been duly audiorised to raise capital by die issue of debt securities and to use to the proceeds of such issuances to make loans to the Public Joint-Stock Company “Orient Express Bank”.


Risk management frameworkThe Board of Directors has overall responsibility for die establishment and oversight of die Company’s risk management framework.

The Company has exposure to the following risks from its use of financial instruments:• Operational risk;• Credit risk;• Market risk; and• Liquidity risk.

(a) Operational riskOperational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the Company’s processes, personnel and infrastructure, and from external factors other dian credit, market and liquidity risks such as those arising from legal and regulatory requirements and generally accepted standards of corporate behaviour. Operational risks arise from all of the Company’s operations.

The Company was incorporated with the purpose of engaging in those activities outlined in note 1. All administration functions have been outsourced by the Company.

(b) Credit riskCredit risk is the risk of the financial loss to the Company if counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from die Company’s credit financial linked assets. The Company's principal financial assets are loans and receivables, odier receivables and cash and cash equivalents, which represent the Company’s maximum exposure to credit risk in relation to financial assets. Any default on die loan is transferable to die Noteholders as the Notes are limited resource and can only be paid out of die proceeds from die loans and receivables. The loans and receivables were repaid and the Notes were redeemed in full during 2017.



17. Financial risk management (continued)(b) Credit risk (continued)

The Company’s maximum exposure to credit risk in the event that counterparties fail to perform the obligations as at 31 December 201 8 in relation to each class of recognised financial assets, is set out below:

Page 17


Other receivables 22,881 3,779Cash and cash equivalents ___________ 14,331_________________ 14,974

37,212_________________ 18,753

The Company does not hold any loans and receivables at financial year end.

(c) Market riskMarket risk for the Company embodies tire potential for both losses and gains and includes interest rate risk, currency risk and price risk.

Interest rate riskThe Company is not exposed to any interest rate risk with exception of cash and cash equivalents. Both the loans and receivables and debt securities issued were repaid in June 2017, and no other activity has been engaged in since the Company became dormant.

The interest rate profile of the Company’s financial assets and liabilities:

Floating rate Fixed Non-interest Total2018 rate bearingAssets USD USD USD USDOther receivables - - 22,881 22,881Cash and cash equivalents 14,331 - - 14,331

14,331 - 22,881 37,212LiabilitiesOther payables 32,711 32,711

- - 32,711 32,711

Net exposure 14,331 . (9,830) 4,501

Floating rate Fixed Non-interest Total2017 rate bearingAssets USD USD USD USDOther receivables - - 3,779 3,779Cash and cash equivalents 14,974 - - 14,974

14,974 - 3,779 18,753LiabilitiesOther payables 14,252 14,252

- - 14,252 14,252

Net exposure 14,974 _ (10,473) 4,501

Sensitivity analysisThe Company does not hold any interest bearing financial instruments with the exception of cash and cash equivalents at year end and therefore no sensitivity analysis has been presented in these financial statements.

Currency riskCurrency risk is the risk which arises due to the assets and liabilities of the Company held in foreign currencies, which will be affected by fluctuations in foreign exchange rates. The Company limits its exposure to currency risk by operating bank accounts in other currencies than its functional currency for receipts and payments in other cunencies than its functional currencies. The Company is exposed to movement in exchange rates between USD, its functional currency, and any foreign currencies.



17. Financial risk management (continued)

(c) Market risk (continued)Currency risk (continued)

The Company's net exposure to foreign currency risk as at 31 December 2018 is as follows:

| Amount in EUR]

Page 18

USDVAT recoverable 3,244Cash and cash equivalents 13,748

16,992

Other payables 32,711

Net position (15,719)

The Company's net exposure to foreign currency risk as at 31 December 2017 is as follows:

Amount in EURUSD

VAT recoverable 3,779Cash and cash equivalents 14,391

18,170

Other payables 11,124

Net position 7,046

Closing rate 31-Dec-18 31-Dec-17EUR 1.1467 1.2005

Sensitivity AnalysisAs at 31 December 2018 the Currency risk that the Company is exposed to is on cash and cash equivalents, other receivables and other payables.

The Company does not hold any material financial instruments at financial year end. The Company holds bank draft in foreign currencies in EUR. The transactions are not significant, and the total exposure to exchange rate fluctuations is not significant. Hence, no sensitivity analysis has been presented.

(d) Price riskPrice risk is the risk that the value of financial instruments will fluctuate as a result of changes in market prices, other than those arising from interest rate risk and currency risk, whether caused by factors specific to an individual investment, its issuer or all factors affecting all instruments traded in the market.

Sensitivity AnalysisThe Company does not hold any financial instruments at year end and as such is not exposed to any price risk. Hence, no sensitivity analysis has been presented.

(e) Liquidity riskLiquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company’s approach is to ensure, as far as possible that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring acceptable losses or risking damage to the Company’s reputation.

The Company’s obligation to the Noteholders is limited to the net proceeds upon realisation of the loans and receivables. Should the net proceeds be insufficient to make all payments due in respect of Notes, tire other assets of tire Company will not be available for payment and the deficit is instead bome by tire Noteholders. The Notes matured on 27 June 2017 and was repaid in full.


Page 19Notes to the financial statements (continued)For the financial year ended 31 December 2018

17. Financial risk management (continued) (e) Fiquidity risk (continued)

The maturity profile of financial liabilities as 31 December 2018 and 2017 is as follows:

2018

LiabilitiesOther payables

2017

LiabilitiesOther payables

GrossCarrying

amountUSD

ContractualCash flows

USD

Less than oneyearUSD

Between one to five years

USDMore than five years

USD

32,711 32,711 32,711 - -

32,711 32,711 32,711 - -

Carryingamount

USD

GrossContractual Cash

flowsUSD

Less than oneyearUSD

Between one to five years

USDMore than five years

USD

14,252 14,252 14,252 -

14,252 14,252 14,252 - -

18. Capital risk managementThe Company views the share capital as its capital. Share capital of FI was issued in line with Irish Company Law and is not used for financing the investment activities of the Company. The Company is not subject to any other externally imposed capital requirements.

19. Events after the statement of financial position dateThere have been no significant subsequent events up to the date of approval of these financial statements.

20. Approval of the financial statementsThe board of Directors approved these financial statements on PJamt/'V' it

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Orient Express Finance Designated Activity Company ......2020/01/14 · Orient Express Finance Designated Activity Company Directors and other information 1 Directors' report 2-3