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REGISTERED NUMBER: 07306136 (England and Wales)















STRATEGIC REPORT, DIRECTORS' REPORT AND

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022

FOR

REFUSE VEHICLE SOLUTIONS LIMITED

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)






CONTENTS OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022




Page

Company Information 1

Strategic Report 2

Directors' Report 4

Report of the Independent Auditors 5

Income Statement 9

Other Comprehensive Income 10

Balance Sheet 11

Statement of Changes in Equity 12

Cash Flow Statement 13

Notes to the Cash Flow Statement 14

Notes to the Financial Statements 15


REFUSE VEHICLE SOLUTIONS LIMITED

COMPANY INFORMATION
FOR THE YEAR ENDED 31 DECEMBER 2022







DIRECTORS: S Law
J Law





SECRETARY: J Law





REGISTERED OFFICE: Unit 2, The Yard
Woodend Lane
Dursley
Gloucestershire
GL11 5HT





REGISTERED NUMBER: 07306136 (England and Wales)





AUDITORS: EV Accountants Limited
Chartered Accountants & Statutory Auditors
Unit 201, Second Floor
Metroline House
118-122 College Road
Harrow
Middlesex
HA1 1BQ

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

The directors present their strategic report for the year ended 31 December 2022.

REVIEW OF BUSINESS
The results for the year and the financial position of the company are shown in the financial statements.

The key areas for comment are stated below: -

During the year ended 31 December 2022, the sales were £24,504,048 (2021 - £20,563,735) an increase of 19.16%. The corresponding cost of sales for the year were £21,089,850 (2021 - £17,620,651) an increase of 19.69%.

The overall performance of the company has declined giving rise to a profit on ordinary activities before taxation of £506,665 (2021 - £725,981).

This growth has contributed to turnover and operating profit being higher than 2021, although we also identify that this year has not been without its challenges mainly due to global economic changes worldwide. In particular, challenges being driven by an unreliable supply chain, aggravated by the war in the Ukraine, Brexit and post pandemic recovery contributing to higher inflation and labour market uncertainties. We anticipate these factors will continue to well into 2023 and beyond.

PRINCIPAL RISKS AND UNCERTAINTIES
The management of the business and the nature of the company's strategy are subject to a number of risks.

The directors have set out below the principal risks facing the business.

The directors are of the opinion that a thorough risk management process is adopted which involves the formal review of all the risks identified below. Where possible, processes are in place to monitor and mitigate such risks.

ECONOMIC CONDITIONS
The performance of the business continues to be reliant on market conditions both within in the UK and Europe. The impact of Brexit can still be felt as with the ongoing conflict in Ukraine

Demand within the UK has been strong for our Product offering but we have not been able to meet this demand due to our European suppliers not being able to keep the supply chain in line with our expectations. This has resulted in a healthy order book for 2023 and beyond, this is being addressed and we are hopeful that the Turnover and Profits for 2023 will reflect this.

Environmental Policy
The Company recognises that it has a responsibility to the environment beyond legal and regulatory requirements. We are committed to reducing our Carbon footprint and the environmental impact of what we do.

The heavy investment we have made into Electric Trucks and continue to do is an integral part of our strategy.


PRODUCT DEVELOPMENT
Product development continues to be our main area of focus.

With large resources supporting the initiative to continue to offer brand new fully electric vehicles into the U.K. market.

FINANCIAL RISK MANAGEMENT, MARKET RISK OBJECTIVES AND POLICIES
The company has a close and strong working relationship with all its stakeholders - particularly our funders, suppliers and customers. These relationships are maintained to minimise any risks that we encounter particularly with regard to Brexit and the military conflict in the Ukraine.

LIQUIDITY RISK
The company monitors cash-flow on a daily basis and has strong controls that monitor our financial performance on an ongoing basis.


REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

CURRENCY RISK
The company does enter into foreign exchange contracts in order to hedge against any anticipated significant currency fluctuations. For the year in question this exposure although increased, this was carefully monitored through the year with contracts taken as and when considered necessary. No currency contracts were held at year end.

ON BEHALF OF THE BOARD:





S Law - Director


30 September 2023

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

The directors present their report with the financial statements of the company for the year ended 31 December 2022.

PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of the hire, refurbishment and sale of refuse vehicles.

DIVIDENDS
During the year, the company paid dividends of £168,690 (2021: £150,536). The director recommends that no final dividend be paid.

FUTURE DEVELOPMENTS
As customer orders for 2023 remain robust, we continue to plan and invest for the growth of the business. We have seen continued and growing appetite for our previously launched products via our international partners AJK, MOL and Emoss. As the sole UK distributor of these premium products we continue to work with our partners to increase and maximise the exposure, suitability reliability and overall performance quality of our product range.

DIRECTORS
S Law has held office during the whole of the period from 1 January 2022 to the date of this report.

Other changes in directors holding office are as follows:

G R Jones - resigned 17 June 2022
J Law - appointed 17 June 2022

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-select suitable accounting policies and then apply them consistently;
-make judgements and accounting estimates that are reasonable and prudent;
-prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's 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 Companies Act 2006. 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS
The auditors, EV Accountants Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:





S Law - Director


30 September 2023

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
REFUSE VEHICLE SOLUTIONS LIMITED

Opinion
We have audited the financial statements of Refuse Vehicle Solutions Limited (the 'company') for the year ended 31 December 2022 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the company's affairs as at 31 December 2022 and of its profit for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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 the financial statements in the UK, including the FRC's Ethical Standard, 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 concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Directors' Report, but does not include the financial statements and our Report of the Auditors 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 this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception
In the light of the knowledge and understanding of the 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.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
REFUSE VEHICLE SOLUTIONS LIMITED


Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
REFUSE VEHICLE SOLUTIONS LIMITED


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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
- we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the industry in which the company operates;
- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and
- understanding the design of the company's remuneration policies.

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

- performed analytical procedures to identify any unusual or unexpected relationships;
- tested journal entries to identify unusual transactions;
- assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;
- enquiring of management as to actual and potential litigation and claims; and
- reviewing correspondence with HMRC, relevant regulators and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
REFUSE VEHICLE SOLUTIONS LIMITED


Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors 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.




Binoy Mistry BA FCA (Senior Statutory Auditor)
for and on behalf of EV Accountants Limited
Chartered Accountants & Statutory Auditors
Unit 201, Second Floor
Metroline House
118-122 College Road
Harrow
Middlesex
HA1 1BQ

30 September 2023

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022

2022 2021
Notes £    £   

TURNOVER 24,504,048 20,563,735

Cost of sales 21,089,850 17,620,651
GROSS PROFIT 3,414,198 2,943,084

Administrative expenses 2,184,026 1,902,579
1,230,172 1,040,505

Other operating income 28,677 148,879
OPERATING PROFIT 4 1,258,849 1,189,384


Interest payable and similar expenses 5 752,184 463,403
PROFIT BEFORE TAXATION 506,665 725,981

Tax on profit 6 - (149,086 )
PROFIT FOR THE FINANCIAL YEAR 506,665 875,067

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022

2022 2021
Notes £    £   

PROFIT FOR THE YEAR 506,665 875,067


OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE INCOME FOR
THE YEAR

506,665

875,067

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

BALANCE SHEET
31 DECEMBER 2022

2022 2021
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 8 161,667 181,667
Tangible assets 9 11,837,617 6,139,302
11,999,284 6,320,969

CURRENT ASSETS
Stocks 10 12,619,821 13,456,302
Debtors 11 4,085,247 2,838,977
Cash at bank 417,200 -
17,122,268 16,295,279
CREDITORS
Amounts falling due within one year 12 13,054,564 8,724,916
NET CURRENT ASSETS 4,067,704 7,570,363
TOTAL ASSETS LESS CURRENT
LIABILITIES

16,066,988

13,891,332

CREDITORS
Amounts falling due after more than one
year

13

13,506,490

11,668,809
NET ASSETS 2,560,498 2,222,523

CAPITAL AND RESERVES
Called up share capital 17 589 589
Share premium 18 94,822 94,822
Capital redemption reserve 18 589 589
Retained earnings 18 2,464,498 2,126,523
SHAREHOLDERS' FUNDS 2,560,498 2,222,523

The financial statements were approved by the Board of Directors and authorised for issue on 30 September 2023 and were signed on its behalf by:





S Law - Director


REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022

Called up Capital
share Retained Share redemption Total
capital earnings premium reserve equity
£    £    £    £    £   

Balance at 1 January 2021 589 1,401,992 94,822 589 1,497,992

Changes in equity
Dividends - (150,536 ) - - (150,536 )
Total comprehensive income - 875,067 - - 875,067
Balance at 31 December 2021 589 2,126,523 94,822 589 2,222,523

Changes in equity
Dividends - (168,690 ) - - (168,690 )
Total comprehensive income - 506,665 - - 506,665
Balance at 31 December 2022 589 2,464,498 94,822 589 2,560,498

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022

2022 2021
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 5,997,451 (2,774,288 )
Interest paid (71,808 ) (910 )
Interest element of hire purchase payments
paid

(680,376

)

(462,493

)
Tax paid - 149,086
Net cash from operating activities 5,245,267 (3,088,605 )

Cash flows from investing activities
Purchase of intangible fixed assets - (200,000 )
Purchase of tangible fixed assets (7,961,003 ) (4,051,508 )
Sale of tangible fixed assets 454,320 575,335
Net cash from investing activities (7,506,683 ) (3,676,173 )

Cash flows from financing activities
Loan repayments in year (137,206 ) (61,451 )
Hire purchase funding 7,381,819 9,990,298
Capital repayments in year (5,286,143 ) (3,279,257 )
Amount withdrawn by directors - (77,685 )
Equity dividends paid (168,690 ) (150,536 )
Net cash from financing activities 1,789,780 6,421,369

Decrease in cash and cash equivalents (471,636 ) (343,409 )
Cash and cash equivalents at beginning
of year

2

(321,901

)

21,508

Cash and cash equivalents at end of year 2 (793,537 ) (321,901 )

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS
2022 2021
£    £   
Profit before taxation 506,665 725,981
Depreciation charges 1,828,368 1,089,183
Loss on disposal of fixed assets - 3,007
Government grants - (148,575 )
Finance costs 752,184 463,403
3,087,217 2,132,999
Decrease/(increase) in stocks 836,481 (4,831,104 )
Increase in trade and other debtors (1,246,270 ) (1,132,346 )
Increase in trade and other creditors 3,320,023 1,056,163
Cash generated from operations 5,997,451 (2,774,288 )

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2022
31.12.22 1.1.22
£    £   
Cash and cash equivalents 417,200 -
Bank overdrafts (1,210,737 ) (321,901 )
(793,537 ) (321,901 )
Year ended 31 December 2021
31.12.21 1.1.21
£    £   
Cash and cash equivalents - 21,508
Bank overdrafts (321,901 ) -
(321,901 ) 21,508


3. ANALYSIS OF CHANGES IN NET DEBT

At 1.1.22 Cash flow At 31.12.22
£    £    £   
Net cash
Cash at bank - 417,200 417,200
Bank overdrafts (321,901 ) (888,836 ) (1,210,737 )
(321,901 ) (471,636 ) (793,537 )
Debt
Finance leases (17,073,749 ) (2,031,342 ) (19,105,091 )
Debts falling due within 1 year - (64,334 ) (64,334 )
Debts falling due after 1 year (261,206 ) 137,206 (124,000 )
(17,334,955 ) (1,958,470 ) (19,293,425 )
Total (17,656,856 ) (2,430,106 ) (20,086,962 )

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

1. STATUTORY INFORMATION

Refuse Vehicle Solutions Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Going concern
The financial statements have been prepared on a going concern basis as the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for a period of at least twelve months from the date of approval of these financial statements.

Turnover
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover represents income from sale of refuse vehicles and hire of such vehicles. The income from sale of of refuse vehicles is recognised when significant risks and rewards are passed to the customer and delivery of these vehicles. The income from hire is recognised based on the period covered by the hire.

Goodwill
Goodwill, being the amount paid in connection with the acquisition of a business in 2021, is being amortised evenly over its estimated useful life of ten years.

Intangible assets
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Improvements to property - 25% on cost
Plant and machinery - at varying rates on cost
Fixtures and fittings - at varying rates on cost
Motor vehicles - 25% on cost
Computer equipment - at varying rates on cost

Improvements to property includes assets under construction. Depreciation is not provided on these assets until such time as the assets are brought into use.

Stocks
Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition.

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2022

2. ACCOUNTING POLICIES - continued

Financial instruments
Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Debtors
Basic financial assets, including trade and other debtors, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment.

Cash and cash equivalents
Cash and cash equivalents are represented by cash in hand, deposits held at call with financial institutions, and other short-term highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

Creditors
Basic financial liabilities, including trade and other creditors, loans from third parties and loans from related parties, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Such instruments are subsequently carried at amortised cost using the effective interest method, less any impairment.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing commitments
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

3. EMPLOYEES AND DIRECTORS
2022 2021
£    £   
Wages and salaries 2,169,170 2,114,033
Social security costs 3,717 -
Other pension costs 10,782 9,824
2,183,669 2,123,857

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2022

3. EMPLOYEES AND DIRECTORS - continued

The average number of employees during the year was as follows:
2022 2021

Directors 2 2
Staff 81 61
83 63

2022 2021
£    £   
Directors' remuneration 39,927 8,850

4. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2022 2021
£    £   
Hire of plant and machinery 32,389 45,860
Depreciation - owned assets 1,808,368 1,070,850
Loss on disposal of fixed assets - 3,007
Goodwill amortisation 20,000 18,333
Foreign exchange differences (17,488 ) -

5. INTEREST PAYABLE AND SIMILAR EXPENSES
2022 2021
£    £   
Bank interest 71,181 151
Other interest payable 627 759
Hire purchase 680,376 462,493
752,184 463,403

6. TAXATION

Analysis of the tax credit
The tax credit on the profit for the year was as follows:
2022 2021
£    £   
Current tax:
R&D tax credit - (149,086 )
Tax on profit - (149,086 )

7. DIVIDENDS
2022 2021
£    £   
Ordinary shares of £1 each
Interim 168,690 150,536

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2022

8. INTANGIBLE FIXED ASSETS
Goodwill
£   
COST
At 1 January 2022
and 31 December 2022 200,000
AMORTISATION
At 1 January 2022 18,333
Amortisation for year 20,000
At 31 December 2022 38,333
NET BOOK VALUE
At 31 December 2022 161,667
At 31 December 2021 181,667

9. TANGIBLE FIXED ASSETS
Improvements Fixtures
to Plant and and
property machinery fittings
£    £    £   
COST
At 1 January 2022 963,421 6,866,055 67,287
Additions 104,355 7,820,300 -
Disposals - (890,974 ) -
At 31 December 2022 1,067,776 13,795,381 67,287
DEPRECIATION
At 1 January 2022 163,278 1,575,059 39,564
Charge for year 160,514 1,615,910 9,537
Eliminated on disposal - (436,654 ) -
At 31 December 2022 323,792 2,754,315 49,101
NET BOOK VALUE
At 31 December 2022 743,984 11,041,066 18,186
At 31 December 2021 800,143 5,290,996 27,723

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2022

9. TANGIBLE FIXED ASSETS - continued

Motor Computer
vehicles equipment Totals
£    £    £   
COST
At 1 January 2022 15,737 67,844 7,980,344
Additions - 36,348 7,961,003
Disposals - - (890,974 )
At 31 December 2022 15,737 104,192 15,050,373
DEPRECIATION
At 1 January 2022 15,737 47,404 1,841,042
Charge for year - 22,407 1,808,368
Eliminated on disposal - - (436,654 )
At 31 December 2022 15,737 69,811 3,212,756
NET BOOK VALUE
At 31 December 2022 - 34,381 11,837,617
At 31 December 2021 - 20,440 6,139,302

Plant and machinery are held under hire purchase contracts.

10. STOCKS
2022 2021
£    £   
Work-in-progress 11,985,862 12,941,902
Finished goods 633,959 514,400
12,619,821 13,456,302

11. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2022 2021
£    £   
Trade debtors 2,607,336 2,647,089
Other debtors 40,916 1,185
Prepayments & accrued income 1,436,995 190,703
4,085,247 2,838,977

12. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2022 2021
£    £   
Bank loans and overdrafts (see note 14) 1,275,071 321,901
Hire purchase contracts (see note 15) 5,722,601 5,666,146
Trade creditors 1,923,670 968,569
VAT 357,784 261,387
Other creditors 1,957,102 1,076,836
Accruals and deferred income 1,818,336 430,077
13,054,564 8,724,916

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2022

13. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
2022 2021
£    £   
Bank loans (see note 14) 124,000 261,206
Hire purchase contracts (see note 15) 13,382,490 11,407,603
13,506,490 11,668,809

14. LOANS

An analysis of the maturity of loans is given below:

2022 2021
£    £   
Amounts falling due within one year or on demand:
Bank overdrafts 1,210,737 321,901
Bank loans 64,334 -
1,275,071 321,901

Amounts falling due between one and two years:
Bank loans - 1-2 years 124,000 261,206

15. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Hire purchase contracts
2022 2021
£    £   
Net obligations repayable:
Within one year 5,722,601 5,666,146
Between one and five years 11,164,335 10,357,226
In more than five years 2,218,155 1,050,377
19,105,091 17,073,749

Non-cancellable operating leases
2022 2021
£    £   
Within one year 237,021 144,504
Between one and five years 612,687 485,104
In more than five years 32,083 64,604
881,791 694,212

16. SECURED DEBTS

The following secured debts are included within creditors:

2022 2021
£    £   
Hire purchase contracts 19,105,091 17,073,749

The hire purchase liability is secured by way of fixed and floating charges over the plant and machinery which is being financed.

REFUSE VEHICLE SOLUTIONS LIMITED (REGISTERED NUMBER: 07306136)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2022

17. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2022 2021
value: £    £   
589 Ordinary £1 589 589

18. RESERVES
Capital
Retained Share redemption
earnings premium reserve Totals
£    £    £    £   

At 1 January 2022 2,126,523 94,822 589 2,221,934
Profit for the year 506,665 506,665
Dividends (168,690 ) (168,690 )
At 31 December 2022 2,464,498 94,822 589 2,559,909

19. RELATED PARTY DISCLOSURES

During the year the company paid rent of £67,872 (2021 - £64,327) to the director, S Law in respect of the company's business premises.

20. ULTIMATE CONTROLLING PARTY

The company was under the control of the director, S Law by virtue of his majority shareholding in the company.