Celestial Green Ventures expects to win €1.9m row

Celestial Green Ventures, the Irish company involved in carbon credit trading associated with a project in the Amazon forest, has said it believes it will win a dispute over the return of a €1.9 million deposit.

The dispute is one of two listed in the 2013 accounts that have just been filed and that show the company reporting a turnover of €2.89 million during the year, up from zero the year before.

The company, which is controlled by Dublin-based director Ciarán Kelly, has reported a 2013 pre-tax profit of €1.6 million, having recorded a €1 million loss in 2012.

The company moved to a larger premises on Merchants Quay, Dublin, in 2014 and increased its employment to 14, from seven, according to accounts just filed. A spokesman for the company could not be contacted yesterday.

Dispute

Notes to the accounts say it is in dispute with an unidentified former customer, now in liquidation, concerning the return of a deposit of €1.9 million. “The company has rejected this claim, has taken legal advice, and is of the view that no provision is necessary.”

The accounts also say the financial implications of legal proceedings regarding the filing of incorrect submissions to the Companies Registration Office in Dublin are a contingent liability.

Celestial Green generates what it calls carbon benefits from avoided deforestation in the Amazonia region of Brazil. The resulting natural capital credits (NCCs) can be traded on the voluntary carbon market, according to the accounts. It had a shareholders’ deficit of €278,198 at year’s end.

Sales operations were outsourced during the year to Irish-registered company Natural Capital Wealth Ltd, which is contracted for the purchase of seven million NCCs over three years, according to the accounts.

Approved

Notes to the accounts say the NCCs were approved in September 2013 and that this allowed the recognition of revenue of €1.9 million on a contract issued in May 2011, whereby a 50 per cent deposit was received.

“In addition, the company sold further credits to the value of €1 million during the year.”

The notes further say that credits to the value of approximately €800,000 were sold in 2014 and contracts for 2.75 million credits to be sold in 2015 and 2016 were in place at the date of the financial statements (April 1st, 2015).

Turnover is derived from the sale of NCCs and is recognised over the period for which the benefit of the credit can be claimed, according to the accounts.

Audit opinion

BDO, the Dublin auditors of Celestial Green, did not provide an audit opinion on the 2012 accounts because of unreceipted expenses, the directors’ reliance on the future sale of NCCs as a basis for saying the company was a going concern, and the potential implication of two pending legal cases. The firm said the 2013 accounts give a true and fair view.

Employment costs during 2013, when the average number of employees was seven, was €235,223, and this included directors’ emoluments of €95,742. Mr Kelly was reimbursed for travel and subsistence expenses of €29,994.

The accounts say that during the year Celestial Green incurred expenses totalling €82,919 on behalf of a company majority owned by Mr Kelly, Carbon Assessment Projects Ltd, also on Merchants Quay, but had provided for the €81,486 it was owed at year’s end due to “significant doubts over its recoverability”.

Accounts for Carbon Assessment show it had a shareholders’ deficit of €81,919 at the end of 2013.

During the year services amounting to €79,137 were provided by Ecosystem Certification Organisation Ltd, a UK company that is limited by guarantee.

Victoria Wright Kelly, a relative of Mr Kelly, is a director of the UK company.