Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2022
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MARLBOROUGH MCDONALD LTD
COMPANY INFORMATION
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MARLBOROUGH MCDONALD LTD
CONTENTS
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MARLBOROUGH MCDONALD LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The directors present their strategic report for the year ended 31 December 2022.
The principal activity of the company in the period under review was that of providing labour services to group companies within the civil engineering industry.
The company has achieved an increase in turnover from £16.85m to £20.73m, however pre tax profit decreased from £1.19m to £0.32m. Net assets decreased from £45k to £8k. Marlborough McDonald Limited provides services to Marlborough Highways Limited in connection with contracts with several London boroughs as well as local authority council in the South East.
The principal risk and uncertainty is the economic climate which has affected budgets available to local authorities.
The company uses various financial instruments to measure and monitor performance which include cash, trade debtors, amounts recoverable on contracts and trade creditors that arise directly from its operations. The main purpose of these financial metrics are to optimise finance for the company's operations. The existence of financial challenges, which are monitored by management, exposes the company to a number of financial risks, which are described in more detail below.
Marlborough McDonald Limited only trades as an internal supply chain partner to Marlborough Highways Limited and is therefore dependent on that business for its work. Credit risk The company's principal financial assets are cash, trade debtors and amounts recoverable on contracts. The associated credit risk is limited as the company's clients are group companies. In order to manage credit risk, the financial controller and directors regularly review the debtors position and the finance department works to formalise procedures for dealing with customers. Liquidity risk The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash in assets both safely and profitably. The company's policy throughout the year has been to achieve this objective through senior management's dayto-day involvement in business decisions rather than through setting maximum or minimum liquidity ratios.
This report was approved by the board on 29 September 2023 and signed on its behalf.
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MARLBOROUGH MCDONALD LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The directors present their report and the financial statements for the year ended 31 December 2022.
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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), 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 for the Company's financial statements and then apply them consistently;
∙make judgments 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 to 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.
The profit for the year, after taxation, amounted to £263,641 (2021 - £954,151).
The directors who served during the year were:
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MARLBOROUGH MCDONALD LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
Our vision is ‘to be the people that people want to work with’, and we know that to achieve this vision effective employee communication and engagement is vital. It also has a direct link to improving organisational culture and productivity. We ensure all our employees have a voice within the company through several different forums, systems, and actions. Our in-house system/app ‘Quest’ provides regular news stories to all employees. It includes updates on company performance, details and feedback on work completed across our contracts, provides health and safety alerts and general employee comms. The system/app is accessible to all employees via a desktop or a mobile device allowing those employees working on the road easy access to stay connected. The executive board treat all employee feedback with respect and importance and take actions to ensure employees feel listened to and involved. We do this in several ways including employee surveys with employee involvement in actions and follow-up, our performance management processes, employee forums attended by the MD, monthly supervisor briefings and whole company away days. Some examples of a recent projects where employees have had the opportunity to be involved before decisions are taken is the review and refresh of our company values. Employees were given the opportunity to feedback through a survey and/or a focus group to help shape our final values. In developing our employee benefits, employees were able to provide feedback on the make-up of our health care cash back plan before it was introduced.
Our MD provides 6-monthly companywide updates on the financial performance of the business, along with plans for future growth, key projects and general updates impacting on employees. These updates provide everyone with a good understanding on the overall company performance, whatever their role in the business. We have a robust performance management process in place across the business, which encourages good conversations about individual performance and development to drive continuous improvement. There are plans this year to embed this further through aligning our strategic business objectives to individual performance objectives and measures. Employees are recruited solely on the basis of work criteria and the applicant’s abilities and individual merit. Reasonable adjustments to the recruitment process are made as required to ensure that no applicant is disadvantaged because of a disability. We are fully committed to ensuring that we are responsive to the changing needs of our employees. Should any employee become disabled during their employment with us, we will actively retrain them and make reasonable adjustments, where possible, in order for them to remain within our employment.
There have been no significant events affecting the Company since the year end.
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MARLBOROUGH MCDONALD LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
The auditors, Barnes Roffe LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board on
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MARLBOROUGH MCDONALD LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARLBOROUGH MCDONALD LTD
We have audited the financial statements of Marlborough McDonald Ltd (the 'Company') for the year ended 31 December 2022, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity and the related notes, 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).
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 United Kingdom, including the Financial Reporting Council'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.
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.
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MARLBOROUGH MCDONALD LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARLBOROUGH MCDONALD LTD (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. 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. 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 course of 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.
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.
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.
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MARLBOROUGH MCDONALD LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARLBOROUGH MCDONALD LTD (CONTINUED)
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 an Auditors' 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 (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:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with law and regulations, was as follows: • 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 discussion with directors and other management, and from our commercial knowledge and experience of the relevant sector; • The specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, are as follows; o Companies Act 2006. o FRS102. o ISO standards. o Health and Safety legislation. o Employment legislation o Tax legislation o ISO 9001 • We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management, reviewing board minutes and inspecting legal correspondence • Laws and regulations were communicated within the audit team at the planning meeting, and during the audit as any further laws and regulation were identified. The audit 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 enquires of management as to where they consider there was susceptibility to fraud and 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; • Reviewing the financial statements and testing the disclosures against supporting documentation; • Performing analytical procedures to identify any unusual or unexpected trends or anomalies; • Inspecting and testing journal entries to identify unusual or unexpected transactions; • Assessing whether judgement and assumptions made in determining significant accounting estimates, including stock provisions, were indicative of management bias; and • Investigating the rationale behind significant transactions, or transactions that are unusual or outside the company's usual course of business. The areas that we identified as being susceptible to misstatement through fraud were: • Management bias in the estimates and judgements made; • Management override of controls; and • Posting of unusual journals or transactions
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MARLBOROUGH MCDONALD LTD
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARLBOROUGH MCDONALD LTD (CONTINUED)
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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 Auditors' 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 an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants & Statutory Auditors
1st Floor
73-81 Southwark Bridge Road
SE1 0NQ
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MARLBOROUGH MCDONALD LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
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MARLBOROUGH MCDONALD LTD
REGISTERED NUMBER: 09508670
BALANCE SHEET
AS AT 31 DECEMBER 2022
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 12 to 19 form part of these financial statements.
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MARLBOROUGH MCDONALD LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Marlborough McDonald Ltd is a private company limited by shares and incorporated in England and
Wales. The address of the registered office is Woolf House, 15 Regiment Business Park, Eagle Way, Little Waltham, Chelmsford, CM3 3FY. The company's principal activity continues to be that of providing labour services to group companies within the civil engineering industry.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.
The following principal accounting policies have been applied:
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d).
This information is included in the consolidated financial statements of Marlborough Highways Group Limited as at 31 December 2022 and these financial statements may be obtained from Companies House.
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
The whole of the turnover is attributable to the main course of business.
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
The UK corporate tax rate is increasing from 19% to 25% (effective 1 April 2023). The increase will therefore increase future tax charges accordingly.
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Secured assets
The bank has a debenture including a fixed charge over all present freehold and leasehold property; first fixed charge over book and other debts, chattels, goodwill and uncalled capital, both present and future; and first floating charge over all assets and undertakings both present and future dated 13 June 2016.
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
A guarantee exists in favour of the group's bankers to cover bank borrowings of certain companies. At 31 December 2022 the net potential exposure in respect of this guarantee was £4,462,039 (2021: £4,559,864). The figure is in respect of the gross borrowings and does not take into account the underlying assets of the respective group companies.
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MARLBOROUGH MCDONALD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
The company operates defined contributions pension schemes. The assets of the schemes are held separately from those of the company in independently administered funds. The pension cost charge represents contributions payable by the company to the funds and amounted to £618,909 (2021: £524,295).
Included within debtors due within one year are balances owed by directors amounting to £4,593 (2021: £128,500 Creditor).
Marlborough Highways Group Limited is regarded by the directors as being the company's ultimate parent company with signifcant control.
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