Company registration number 04838546 (England and Wales)
ELECOMM LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
ELECOMM LIMITED
COMPANY INFORMATION
Directors
C Thomas
M P Mansell
L D Wareham
(Appointed 27 April 2022)
Secretary
M P Mansell
Company number
04838546
Registered office
C4 Beighton Link Business Park
Old Colliery Way
Sheffield
United Kingdom
S20 1DJ
Auditor
Hart Shaw LLP
Europa Link
Sheffield Business Park
Sheffield
S9 1XU
ELECOMM LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 26
ELECOMM LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

The directors present the strategic report for the year ended 31 March 2023.

Review of the business

At Elecomm we continue to deliver a huge variety of projects across the UK and Europe, many having a positive impact on the lives of many individuals and communities during delivery and when completed, our portfolio of delivered works covers food retailers, hospitals, logistic warehouses, education, and accommodation etc which we all take enormous pride in.

 

Elecomm remains very much a family focussed company, our values, ethos, and culture are moulded around these factors, we focus on our colleagues/clients and part of our vision must be to continue to ensure that we re-invest in our resources, particularly in the training of our people and the continual development of our Health & Safety culture.

 

Elecomm is a sector leading, independent business that embeds respect and honesty into everything we do, and we are committed to prudent management to ensure the long-term prosperity of the business, our operations are transparent and accountable, and we balance corporate, ethical, and environmental principles with sound business practice for sustainable commercial success.

 

As we continue to be a leader in the provision of Data/IT Services and Building Services Engineering, we are more focussed than ever to maintain our current position and in order to do this we must continue to invest in the right people to deliver the quality that we and our clients expect and whilst we must strive to maintain our current market offer we must always be pushing our innovation boundaries.

 

The financial Year 2022/2023 saw Elecomm return to a more realistic and positive trading profit of £869,251 this in essence is a result of the corrective measures that the Executive Board Directors and the Senior Management Team have put in place. Our Structure re-balance in July 2022 and the changes implemented to enhance our onsite operations, commercial strategy and our delivery efficiencies has now started to make an impact on our financial performance.

 

The continual focus within the business of delivering total client satisfaction has enabled it to maintain and build relationships with existing clients whilst at the same time strengthening our new client base.

 

Elecomm has had a strong start to the new financial year and the Directors are confident that the business is well placed to achieve its forecast.

 

ELECOMM LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Principal risks and uncertainties

General; We are still experiencing volatile and fluctuating changes in the cost of labour and materials and the directors continually assess the risks facing the business and adapt to the changes despite the challenging economic conditions, the business has delivered a strong performance, with growth in revenue which is planned to continue with a strong pipeline of work throughout the financial year into 2024.

 

Financial; Elecomm has a diverse client base and works across a variety of business sectors, the business looks to mitigate financial/credit risk through regularly assessing and monitoring of our New/Existing key clients to protect Elecomm from potential bad debt.

 

Health and Safety, Quality and Environment; These are part of our primary focus for the business, and they are at the heart of all we do, our In-house HSQE team promotes best practice throughout all our operations. The health and safety of all employees and customers is of vital importance to the company and we constantly strive to achieve the highest standards supported by effective process and procedures, risk is managed through maintaining rigorous health and safety policies, the training of staff and regular site audits.

Human Resources; The company recognises that a key component to its success, and to enable it to meet the challenges that it faces, is the ability to attract, retain and develop the best people it can. The company has an excellent history in retaining its employees and will strive to continue to do this by ensuring staff development and training is encouraged at all levels by creating a work culture and environment that enables this to flourish.

 

Supply Chain; An important facet of the business is the company's supply chain for products and materials, the company has long standing and synergistic relationships with its key suppliers. Our procurement department works closely with all suppliers in order to ensure we achieve the best quality and price whilst minimising risk by ensuring that we are not over reliant upon any particular supplier. Recognising the importance of the supply chain, the company continues to hold an annual supply chain award, with awards being issued for Quality, Environmental awareness, and Health & Safety.

 

3 Year Strategy Plan; We have restructured our Board which is split between Exec (shareholders and MD) and a Senior Management Team which has been significantly strengthened and we are confident that these changes will enhance our delivery and profitability levels significantly in the coming years and pivotal to delivering some sustainable growth in the business.

 

On behalf of the board

L D Wareham
Director
27 September 2023
ELECOMM LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

The directors present their annual report and financial statements for the year ended 31 March 2023.

Principal activities
The principal activity of the company continued to be that of electrical engineers and associated activities.
Results and dividends

The results for the year are set out on page 9.

Ordinary interim dividends were paid amounting to £253,500.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

C Thomas
M P Mansell
S P Thomas
(Resigned 21 July 2022)
J M Hamilton
(Resigned 16 January 2023)
M R O'Driscoll
(Resigned 7 December 2022)
N M Metcalfe
(Resigned 7 December 2022)
L D Wareham
(Appointed 27 April 2022)
Auditor

In accordance with the company's articles, a resolution proposing that Hart Shaw LLP be reappointed as auditor of the company will be put at a General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
L D Wareham
Director
27 September 2023
ELECOMM LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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:

 

 

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.

ELECOMM LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ELECOMM LIMITED
- 5 -
Opinion

We have audited the financial statements of Elecomm Limited (the 'company') for the year ended 31 March 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including 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:

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 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 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 other information comprises the information included in the annual report other than the financial statements and our auditor's 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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

ELECOMM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELECOMM LIMITED
- 6 -
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 in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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 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 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.

Auditor's 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 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 (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:

Extent to which the audit was considered capable of detecting irregularities, including fraud and the audit response

We have assessed the overall susceptibility of the financial statements to material misstatements as low because the nature of the business does not particularly lend itself to fraud. Our audit plan identified certain significant risks and our audit work was targeted to ensure it was capable of detecting any irregularities, including fraud, created by those risks. Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly followed auditing standards.

At the planning stage we identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience and through discussion with the directors and other management, as required by auditing standards. The potential effect of any laws and regulation on the financial statements can vary considerably. There are laws and regulations that directly affect the financial statements (e.g. the Companies Act) as well as many other operational laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements. Owing to the size, nature and complexity of the organisation and the applicable laws and regulations to which it must adhere, the risk of material misstatement was deemed to be low, therefore the procedures performed by the audit team were limited to:

ELECOMM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELECOMM LIMITED
- 7 -

Management override is the most likely way in which fraud might present itself and as such is inherently high risk on any audit. Management override, which may cause there to be a material misstatement within the financial statements, may present itself in a number of ways, for example:

 

In order to reduce the risk of material misstatement to an acceptable level, numerous audit procedures were performed including:

At the planning stage we identified revenue recognition as high risk due to the subjective stage of completion estimation made by management which could reasonably be expected to have a material effect on the financial statements. In order to reduce the risk of material misstatement to an acceptable level, numerous audit procedures were performed including:

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected material misstatements in the financial statements, even though we have performed our audit in accordance with auditing standards. Furthermore, as with all audits, there is a higher risk of irregularities (especially those relating to fraud) being undetected, as these may involve the override of internal controls, collusion, intentional omissions and misrepresentations etc. We are not responsible for preventing non-compliance or fraud and therefore cannot be expected to detect all instances of such. Our audit was not designed to identify misstatements or other irregularities that would not be considered to be material to the financial statements.

ELECOMM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELECOMM LIMITED
- 8 -

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 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.

Martin McDonagh
Senior Statutory Auditor
For and on behalf of Hart Shaw LLP
2 October 2023
2023-10-02
Chartered Accountants
Statutory Auditor
Europa Link
Sheffield Business Park
Sheffield
S9 1XU
ELECOMM LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
19,861,044
22,741,240
Cost of sales
(14,108,658)
(17,566,009)
Gross profit
5,752,386
5,175,231
Administrative expenses
(4,891,585)
(5,143,695)
Other operating income
7,000
17,419
Operating profit
4
867,801
48,955
Interest receivable and similar income
7
4,860
972
Interest payable and similar expenses
8
(3,410)
-
0
Profit before taxation
869,251
49,927
Tax on profit
9
(168,052)
38,591
Profit for the financial year
701,199
88,518

The profit and loss account has been prepared on the basis that all operations are continuing operations.

ELECOMM LIMITED
BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
230,117
82,628
Current assets
Stocks
13
243,709
853,922
Debtors
14
4,971,592
4,479,199
Cash at bank and in hand
539,421
1,350,204
5,754,722
6,683,325
Creditors: amounts falling due within one year
15
(3,948,826)
(5,316,406)
Net current assets
1,805,896
1,366,919
Total assets less current liabilities
2,036,013
1,449,547
Creditors: amounts falling due after more than one year
16
(118,567)
-
0
Provisions for liabilities
Deferred tax liability
18
20,200
-
0
(20,200)
-
Net assets
1,897,246
1,449,547
Capital and reserves
Called up share capital
21
108
108
Profit and loss reserves
1,897,138
1,449,439
Total equity
1,897,246
1,449,547
The financial statements were approved by the board of directors and authorised for issue on 27 September 2023 and are signed on its behalf by:
L D Wareham
Director
Company Registration No. 04838546
ELECOMM LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2021
108
1,751,921
1,752,029
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
88,518
88,518
Dividends
10
-
(391,000)
(391,000)
Balance at 31 March 2022
108
1,449,439
1,449,547
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
701,199
701,199
Dividends
10
-
(253,500)
(253,500)
Balance at 31 March 2023
108
1,897,138
1,897,246
ELECOMM LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
25
(33,728)
498,271
Income taxes refunded
36,314
131,593
Net cash inflow from operating activities
2,586
629,864
Investing activities
Purchase of tangible fixed assets
(64,369)
(71,792)
Repayment of loans
10,756
81,000
Interest received
4,860
972
Net cash (used in)/generated from investing activities
(48,753)
10,180
Financing activities
Proceeds from new bank loans
-
0
500,000
Repayment of bank loans
(500,000)
-
0
Payment of finance leases obligations
(7,706)
-
0
Interest paid
(3,410)
-
0
Dividends paid
(253,500)
(391,000)
Net cash (used in)/generated from financing activities
(764,616)
109,000
Net (decrease)/increase in cash and cash equivalents
(810,783)
749,044
Cash and cash equivalents at beginning of year
1,350,204
601,160
Cash and cash equivalents at end of year
539,421
1,350,204
ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
1
Accounting policies
Company information

Elecomm Limited is a private company, limited by shares and incorporated in England and Wales. The registered office is C4 Beighton Link Business Park, Old Colliery Way, Sheffield, United Kingdom, S20 1DJ.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared on the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from contracts for the provision of services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 3 years.

1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold improvements
20% straight line
Plant and machinery
20% - 25% straight line
Fixtures, fittings and equipment
20% - 25% straight line
Computer equipment
33.3% straight line
Motor vehicles
10% - 15% straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 14 -

At each reporting end date, the company reviews the carrying amount of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

1.7
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -
Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans and loans from fellow group companies, 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 receipts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.8
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

1.9
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

1.10
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.11
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.12
Share-based payments

Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.

When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.

 

Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.

1.13
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
1.14
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Critical judgements

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Accrued income

The company has profit making contracts which were in progress at the year end, for which work had been completed but not yet invoiced. In accordance with the accounting policy and the standards mentioned above, the company has accrued the revenue for which it is entitled to on these contracts to ensure sufficient revenue has been recognised in accordance with the stage of completion method. At the year end, the amount of accrued revenue totalled £1,042,282 (2022: £1,834,104).

Accrued contract costs

As described above there are contracts in progress at the year end, for which income has been accrued. Likewise there have been costs incurred on these contracts for which purchase invoices were not received by the year end. Management have reviewed open purchase orders at the year end and used their expertise to prepare an accrual for contract costs. There have been costs incurred on these contracts which were in progress at the year end for which costs totalled £1,211,144 (2022: £1,908,391).

3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2023
2022
£
£
Turnover analysed by class of business
Rendering of services
19,861,044
22,741,240
2023
2022
£
£
Other significant revenue
Interest income
4,860
972
Grants received
7,000
17,419
ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
-
0
544
Government grants
(7,000)
(17,419)
Fees payable to the company's auditor for the audit of the company's financial statements
17,000
16,000
Depreciation of owned tangible fixed assets
46,114
49,087
Depreciation of tangible fixed assets held under finance leases
11,028
-
Loss on disposal of tangible fixed assets
1,423
-
Amortisation of intangible assets
-
49,265
Operating lease charges
87,145
41,500
5
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Engineers
41
52
Office
78
84
Total
119
136

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
5,037,485
5,757,005
Social security costs
571,220
603,697
Pension costs
295,379
267,668
5,904,084
6,628,370
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
313,351
361,606
Company pension contributions to defined contribution schemes
100,318
93,925
413,669
455,531

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 7 (2022: 6)

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
6
Directors' remuneration
(Continued)
- 19 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
95,656
82,054
Company pension contributions to defined contribution schemes
10,475
4,443
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
4,392
67
Other interest income
468
905
Total income
4,860
972
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
4,392
67
8
Interest payable and similar expenses
2023
2022
£
£
Other finance costs:
Interest on finance leases and hire purchase contracts
3,410
-
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
137,652
11,740
Adjustments in respect of prior periods
-
0
(48,131)
Total current tax
137,652
(36,391)
Deferred tax
Origination and reversal of timing differences
30,400
(2,200)
Total tax charge/(credit)
168,052
(38,591)
ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
9
Taxation
(Continued)
- 20 -

The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
869,251
49,927
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
165,158
9,486
Tax effect of expenses that are not deductible in determining taxable profit
79
1,678
Adjustments in respect of prior years
-
0
(48,131)
Permanent capital allowances in excess of depreciation
(30,585)
(8,407)
Amortisation on assets not qualifying for tax allowances
-
0
9,360
Deferred tax movement
30,400
(2,200)
Short term timing differences
3,000
(377)
Taxation charge/(credit) for the year
168,052
(38,591)
10
Dividends
2023
2022
£
£
Interim paid
253,500
391,000
11
Intangible fixed assets
Goodwill
£
Cost
At 1 April 2022 and 31 March 2023
147,793
Amortisation and impairment
At 1 April 2022 and 31 March 2023
147,793
Carrying amount
At 31 March 2023
-
0
At 31 March 2022
-
0
ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 21 -
12
Tangible fixed assets
Leasehold improvements
Plant and machinery
Fixtures, fittings and equipment
Computer equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 April 2022
4,150
44,414
8,078
152,577
-
0
209,219
Additions
-
0
14,101
2,785
33,507
155,661
206,054
Disposals
-
0
(4,945)
(210)
(30,472)
-
0
(35,627)
At 31 March 2023
4,150
53,570
10,653
155,612
155,661
379,646
Depreciation and impairment
At 1 April 2022
1,383
30,602
4,019
90,587
-
0
126,591
Depreciation charged in the year
830
12,567
1,706
31,011
11,028
57,142
Eliminated in respect of disposals
-
0
(3,728)
(4)
(30,472)
-
0
(34,204)
At 31 March 2023
2,213
39,441
5,721
91,126
11,028
149,529
Carrying amount
At 31 March 2023
1,937
14,129
4,932
64,486
144,633
230,117
At 31 March 2022
2,767
13,812
4,059
61,990
-
0
82,628

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2023
2022
£
£
Motor vehicles
144,633
-
0
13
Stocks
2023
2022
£
£
Work in progress
111,850
381,640
Finished goods and goods for resale
131,859
472,282
243,709
853,922
ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 22 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
3,752,109
2,223,898
Corporation tax recoverable
-
0
37,861
Other debtors
8
267,047
Prepayments and accrued income
1,219,475
1,940,193
4,971,592
4,468,999
Deferred tax asset (note 18)
-
0
10,200
4,971,592
4,479,199

Included within trade debtors is an amount of £1,938,707 (2022 - £838,056) which is subject to an invoice discount agreement.

15
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans (CBIL)
-
0
500,000
Obligations under finance leases
17
15,412
-
0
Trade creditors
1,483,515
2,047,175
Corporation tax
136,105
-
0
Other taxation and social security
606,329
302,000
Other creditors
83,925
56,318
Accruals and deferred income
1,623,540
2,410,913
3,948,826
5,316,406

The obligations under finance leases are secured on the fixed assets to which they relate.

16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
17
118,567
-
0

The obligations under finance leases are secured on the fixed assets to which they relate.

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
22,320
-
0
In two to five years
135,838
-
0
158,158
-
0
Less: future finance charges
(24,179)
-
0
133,979
-
0

Finance lease payments represent rentals payable by the company for certain items of motor vehicles. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

18
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Balances:
£
£
£
£
Accelerated capital allowances
20,200
-
-
7,800
Short term reversing add backs
-
-
-
2,400
20,200
-
-
10,200
2023
Movements in the year:
£
Liability/(Asset) at 1 April 2022
(10,200)
Charge to profit or loss
30,400
Liability at 31 March 2023
20,200

The deferred tax asset set out above is expected to reverse in line with the writing down of the accelerated capital allowances, short term add backs are expected to reverse within 12 months.

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 24 -
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
295,379
267,668

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share-based payment transactions
Number of share options
Weighted average exercise price
2023
2022
2023
2022
Number
Number
£
£
Outstanding at 1 April 2022
96
96
244.47
244.47
Forfeited
(42)
-
0
244.47
-
0
Outstanding at 31 March 2023
54
96
244.47
244.47
Exercisable at 31 March 2023
54
64
244.47
244.47

The weighted average share price at the date of exercise for share options exercised during the year was £0 (2022 - £0).

The options outstanding at 31 March 2023 had an exercise price of £244.47, and a remaining contractual life of 8 years.

21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 10p each
1,080
1,080
108
108
22
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
46,535
65,333
Between two and five years
14,994
-
0
61,529
65,333
ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
23
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Sales
Purchases
2023
2022
2023
2022
£
£
£
£
Other related parties
382
84
476,284
1,316,776

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£
£
Other related parties
25,447
60,288

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due from related parties
£
£
Other related parties
-
253,750
Other information

Dividends totalling £253,500 (2022: £391,000) were declared in the year in respect of shares held by the company's directors and close family.

 

Interest free amounts of £8 (2022: £10,764) were due to the company from the directors as at 31 March 2023.

24
Consolidation accounting exemption

Elecomm Limited had one wholly owned UK subsidiary up until 31 January 2023 when it entered voluntary liquidation. Therefore, under Section 405 of the Companies Act 2006, it may be excluded from consolidation as its inclusion is not material for the purpose of giving a true and fair view.

 

Under Section 402, as Elecomm Limited's only subsidiary has been excluded from consolidation, it is exempt from the requirement to prepare group accounts.

 

ELECOMM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
25
Cash (absorbed by)/generated from operations
2023
2022
£
£
Profit for the year after tax
701,199
88,518
Adjustments for:
Taxation charged/(credited)
168,052
(38,591)
Finance costs
3,410
-
0
Investment income
(4,860)
(972)
Loss on disposal of tangible fixed assets
1,423
-
Amortisation and impairment of intangible assets
-
0
49,265
Depreciation and impairment of tangible fixed assets
57,142
49,087
Movements in working capital:
Decrease/(increase) in stocks
610,213
(670,656)
(Increase)/decrease in debtors
(551,210)
1,621,626
Decrease in creditors
(1,019,097)
(600,006)
Cash (absorbed by)/generated from operations
(33,728)
498,271
26
Analysis of changes in net funds
1 April 2022
Cash flows
New finance leases
31 March 2023
£
£
£
£
Cash at bank and in hand
1,350,204
(810,783)
-
539,421
Borrowings excluding overdrafts
(500,000)
500,000
-
-
Obligations under finance leases
-
7,706
(141,685)
(133,979)
850,204
(303,077)
(141,685)
405,442
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