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Registered number: 13667814














          Brewer Topco Limited

          Directors' Report and Financial Statements

          For the Period Ended 31 March 2023














         img4e70.png 

 
Brewer Topco Limited
 
 
Company Information


Directors
N Cox (Chairman) 
R E Farmer 
M C Hargate 
E Hickley 
L A Kingston 
R C McNeilly (Chief Executive Officer) 
A P Morris 
J P Southwell 




Registered number
13667814



Registered office
Horizon Capital
Level 9 The Shard

32 London Bridge Street

London

SE1 9SG




Independent auditor
MHA

Rutland House

148 Edmund Street

Birmingham

B3 2FD




Bankers
HSBC Bank Plc
130 New Street

Birmingham

B2 4JU




Solicitors
CMS Cameron McKenna Nabarro Olswang LLP
Cannon Street

London

EC4N 6AF





 
Brewer Topco Limited
 

Contents



Page
Group Strategic Report
 
1 - 4
Directors' Report
 
5 - 8
Independent Auditor's Report
 
9 - 11
Consolidated Profit and Loss Account
 
12
Consolidated Statement of Comprehensive Income
 
13
Consolidated Balance Sheet
 
14 - 15
Company Balance Sheet
 
16
Consolidated Statement of Changes in Equity
 
17
Company Statement of Changes in Equity
 
18
Consolidated Statement of Cash Flows
 
19 - 20
Consolidated Analysis of Net Debt
 
21
Notes to the Financial Statements
 
22 - 47


 
Brewer Topco Limited
 
 
Group Strategic Report
For the Period Ended 31 March 2023

Introduction
 
The Strategic Report has been prepared by the directors to provide additional information to shareholders in respect of the Group’s strategies and business objectives.
The Strategic Report contains forward-looking statements, which have been made in good faith by the directors based on information available up to the point of approval of this report. Therefore, there are inherent uncertainties involved in making these statements, including both economic and business risk factors.
The directors, in preparing the Strategic Report, have complied with s414C of the Companies Act 2006.

Business review
 
Brewer Topco Limited was incorporated on 7 October 2021 in order to facilitate the Investment in the Dains Group of businesses on 14 December 2021 whereby Horizon Capital acquired a controlling stake in the Group and provided capital to expand our capabilities further (“The Investment”).
For the trading period 14 December 2021 to 31 March 2023 the Group has recorded record turnover of £33.3m and EBITDA (earnings before interest, tax, depreciation and amortisation) of £6.38m. When considering our post year end acquisitions on a full year basis our proforma revenues are approximately £42 million with EBITDA of £8.8 million. This performance is in line with business plan and benchmarks well to target EBITDA margin of 20% per annum. 
Our  strategy is to expand the Group service line proposition, as well as our geographical footprint, both organically and via the acquisition of similar and complimentary businesses. In our first period of trading following the Investment we are pleased to have acquired  Barringtons Limited, a well-established accountancy practice with its primary office in Stoke, Isosceles Finance Limited, a multi-disciplinary outsourced accounting, FD and HR services business with offices in Surrey and South Yorkshire and William Duncan + Co, a long established general accountancy and business recovery practice with offices in Glasgow and Ayrshire.  
We are delighted with the progress we have made in delivering our strategy in the period and this strong momentum has continued post year end with the acquisition of two further business, Opto Group Limited, a specialist VAT and Employment tax advisory firm to the public sector and not for profit sector and HSKS Greenhalgh Limited, a well-regarded accountancy, audit and taxation firm based in the East Midlands.  In addition further acquisitions are at an advanced stage which we anticipate completing in the next financial year, subject to satisfactory due diligence
All acquired businesses provide a great cultural fit and we warmly welcome them into our enlarged Group which we are proud to say is now one of the fastest growing accountancy firms in the UK with a large and diverse client base, and high levels of repeat or re-occurring revenues. Gross margins are strong and cash generation is excellent confirming that both the legacy Dains business and the acquired businesses are performing well. With increased scale comes the ability to cross sell services across the Group and in a fragmented market we are very well placed to take advantage of many opportunities open to us for the benefit of staff and clients alike as we work towards our ambition of being the go-to firm in the profession. 

Principal risks and uncertainties
 
Risks are managed across the Group which includes those relevant to the company.
The principal risks and uncertainties outlined in this section reflect those risks that, in the opinion of the Board, might materially affect the Group’s future performance, prospects or reputation. The Group uses a robust risk management framework, which provides control and oversight as we continue to scale our business. These controls include maintaining a comprehensive risk register which is reviewed regularly by the Board and  the executive management team, in order to outline the key and emerging risks that the Group is exposed to, and any remedial actions required to mitigate such risks in a timely manner.

 
Page 1

 
Brewer Topco Limited
 

Group Strategic Report (continued)
For the Period Ended 31 March 2023

The Board sets our overarching risk culture and appetite and ensures that we manage risk appropriately across the Group. Financial, regulatory and compliance and reputation and brand risks are top priorities. At a functional level, each service line is responsible for preparing and maintaining their functional risk registers and, with the assistance of the Board, identify, assess, manage and monitor the risks and review emerging risks within their service line. Each risk is assigned an owner through which ongoing activities, control measures and any actions related to that risk are updated whilst at all times applying the agreed risk appetite set by the Board.
Financial Risk
The Group's activities expose it to a number of financial risks. These include movements in interest rates on bank borrowings, rising office costs including increasing energy costs and wage inflation.
With these risks and uncertainties in mind, we are aware that any plans for the future development of the Group may be subject to unforeseen future events outside of our control. However, we will continue to show flexibility and respond to market conditions and opportunities as they arise.
The Group’s principal financial instruments comprise bank balances, bank loans, other loans, trade debtors and trade creditors. The main purpose of these instruments is to finance the business' operations.
In respect of bank balance, the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility. All of the Group's cash balances are held in such a way that achieves a competitive rate of interest.
In respect of bank loans and other loans, the Group is financed through a combination of debt instruments which carry a mixture of fixed and variable rates of interest.
Trade debtors are managed in respect of credit and cash flow risks by policies concerning the credit offered to customers and regular monitoring of the amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of allowances for doubtful debtors.
Trade creditors' liquidity risk is managed by ensuring sufficient funds are available to meet amounts due. 
Regulatory and Compliance Risk
The accountancy, audit and taxation sectors are heavily regulated and as a result, in addition to the normal government guidelines and regulations that a business is subject to, the Group is also regulated by the Institute of Chartered Accountants in England and Wales ("ICAEW") and The Institute of Chartered Accountants of Scotland ("ICAS"), and Information Commissioners Office (‘ICO’). Non  compliance with any regulations  could result in reputation damage to the Group and may have financial implications.
The Group has a strong Compliance and Regulatory team which regularly monitors compliance with all necessary regulations through a mixture of internal and external reviews. The Board is updated on any regulatory developments and any re-assessment of risk to the business so that it can ensure that such matters are fully considered in all business and strategic decisions. The Group aims to ensure that colleagues are appropriately trained, supervised and incentivised to ensure their behaviour and activities do not inadvertently result in poor outcomes for clients. The Group has embedded the International Standard on Quality Management (UK) 1 and 2 as issued by the Financial Reporting Council.
Reputation and Brand Risk
The Dains, William Duncan and Isosceles Finance brands and the reputation of the Group and its professionals are driving factors behind the success of the Group. Anything that damages the Group’s brand or reputation could negatively impact the future success of the business. Damage to the Group's brands could have a detrimental impact reputationally which ultimately could have financial implications for the Group.
The Board has in place detailed processes to ensure that all work is undertaken in accordance with the ICAEW or ICAS Code of Conduct and Professional Ethics. Regular internal cold field reviews are undertaken to identify areas of non-compliance and the Group has employment policies and procedures in place to deal with such issues. The employment contracts for all employees also contain appropriate provisions in regard to the standards expected and preservation of confidential information.

Page 2

 
Brewer Topco Limited
 

Group Strategic Report (continued)
For the Period Ended 31 March 2023

Financial key performance indicators
 
The management team and individual services lines uses a number of key performance indicators (KPIs) to monitor the Group’s performance against its strategic objectives. These comprise a number of financial measures which are agreed and monitored by the Board.
The financial indicators are generally calculated based on underlying results excluding any one-off transactional and acquisition related costs as these underlying KPIs provide a more meaningful comparison of the key drivers of the Group’s financial success.
The overarching focus of the Board is on overall growth in both fee income and profitability, with a view to improving the profit margins achieved across the individual services and Group as a whole whilst still maintaining a well invested business with a strong management and support function able to meet its evolving needs. 
The Board considers the Groups key performance indicators to be revenue and EBITDA and are happy with the performance of the business as noted in the business review when measured against these indicators.

Other key performance indicators
 
In addition to the financial key performance indicators, the Board use a number of non-financial key performance indicators to monitor the Group's performance against the strategic objectives.
The Groups non-financial key performance indicators are considered to be staff attrition and client and staff net promoter scores which for the year under review were as follows:
Group Staff attrition – 16.7% 
Staff Net Promoter Score NPS +28
Client Net Promoter Score NPS +81

Directors' statement of compliance with duty to promote the success of the Group
 
Section 172 of the Companies Act 2006 requires directors to act in a way that they consider, in good faith, would be, most likely to promote the success of a company. In doing so, directors must take into consideration the interests of the various stakeholders of the Group, the impact of the Group's operations on the community and the environment, take a long-term view on consequences of the decisions they make as well as aim to maintaining a reputation for high standards of business conduct and fair treatment between the members of the Group.
In complying with the requirements of section 172 of the Act, the directors should be able to ensure that all decisions are made in a responsible and sustainable way for the benefit of all stakeholders. In accordance with the requirements of the Companies (Miscellaneous Reporting) Regulations 2018, the Group explains below how the directors have discharged their duty under section 172. This section serves as the Company's Section 172 Statement.
The Group's stakeholders include its employees, its clients, shareholders, regulators, as well as the wider community in which the Group operates and impacts. Details of how the Board seeks to understand the needs and priorities of the Group's stakeholders and how these are taken into account during all its discussions and as part of its decision making are set out below:
Employees
Employee engagement is important to our success. We work to create a diverse and inclusive workplace where every employee can reach their full potential and be at their best. We engage with our people to ensure we are delivering to their expectations, supporting wellbeing and making the right business decisions. This ensures we can retain and develop the best talent.


 
Page 3

 
Brewer Topco Limited
 

Group Strategic Report (continued)
For the Period Ended 31 March 2023

Clients
Focusing on the needs of our clients is critical to the success of our business. We maintain a high degree of professionalism and client service and interaction in order to anticipate and understand the future needs of our clients and their stakeholders, building on our years of experience in delivering to our specialist services. We collaborate and innovate with our clients to improve our service offering and value to our clients.
Shareholders and lenders
We work to ensure that our shareholders have a strong understanding of our strategy, performance, ambition and culture.
Regulators
The Group continues to work hand in hand with its regulator, the Institute of Chartered Accountants in England and Wales ("ICAEW") and The Institute of Chartered Accountants of Scotland ("ICAS"), to ensure that it abides by its professional and regulatory duties and obligations in an open and transparent manner. The Board conducts regular internal and external compliance reviews.
Communities
Our ‘Dains in the Community’ initiative supports local charities, events and initiatives. We like to: take responsibility for the community; donate to, raise awareness of and support charities that are important to employees and our clients; and be a positive role model to other companies. We inspire by leading the way. Each year we help charities, schools, clubs, parish councils and other worthwhile Groups with their compliance requirements.
Culture
The Board are responsible for the overall effectiveness in directing the Group and promoting a culture of openness and debate and seeks to facilitate effective contributions by all Directors and employees. The Directors are required to act with integrity, lead by example and promote this culture within the Group.
The Board seeks to ensure the alignment of the Group’s purpose, value and strategy with the culture of openness, debate and integrity through ongoing dialogue, and engagement with Stakeholders. It has adopted a number of policies, practices and behaviours to facilitate a culture of good governance and ensure that this is maintained.


This report was approved by the board on 6 October 2023 and signed on its behalf.




___________________________
R C McNeilly
Chief Executive Officer

Page 4

 
Brewer Topco Limited
 

 
Directors' Report
For the Period Ended 31 March 2023

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

The company was incorporated on 7 October 2021 and has extended its first accounting reference date to 31 March 2023.

Matters covered in the Group Strategic Report

The following disclosures as required by S414C (11) have been elevated to the strategic report:
• Financial risk management objectives and policies
• Key financial key performance indicators
• Key other key performance indicators

Principal activity

The principal activity of the Group during the period was that of the provision of accountancy, audit, business recovery, taxation and business advice services.
The principal activity of the company is that of a holding company.

Results and dividends

In its first period of trading the Group has recorded turnover of £33.3m and EBITDA of £6.38m. The loss for the period, after taxation and minority interests, amounted to £529,310.

The directors do not recommend payment of an ordinary dividend for the current period.

Directors

The directors who served during the period were:

N Cox (Chairman) (appointed 15 June 2022)
R E Farmer (appointed 14 December 2021)
M C Hargate (appointed 14 December 2021)
E Hickley (appointed 7 October 2021)
L A Kingston (appointed 7 October 2021)
R C McNeilly (Chief Executive Officer) (appointed 14 December 2021)
A P Morris (appointed 14 December 2021)
A Shaw (appointed 22 December 2022, resigned 2 October 2023)
J P Southwell (appointed 14 December 2021)

Health and safety of employees

The well-being of the Group’s employees is safeguarded through strict adherence to health and safety standards. The Safety, Health and Welfare at Work Act 1989 imposes certain requirements on employers and the Group has taken the necessary action to ensure compliance with the Act, including the adoption of a Safety Statement.

Page 5

 
Brewer Topco Limited
 

 
Directors' Report (continued)
For the Period Ended 31 March 2023

Environmental matters

The Group will seek to minimise adverse impacts on the environment from its activities, whilst continuing to address health, safety and economic issues. The Group has complied with all applicable legislation and regulations.
In August 2022, we partnered with Play It Green to improve our business’ sustainability practices and have a positive impact on the planet.
In return for a monthly cost per person, Play it Green plant 13 trees per person per month, instantly rebalancing their personal carbon footprint.
We are also making our business a Climate Positive one by rebalancing our historical and company emissions to become carbon neutral. To reduce our overall business carbon footprint moving forward, we are working with Play it Green’s Net Zero Framework, Green Energy giving us access to a network of sustainability experts.

Future developments

The Board plans to continue to invest in technology, recruitment and acquisitions within the accountancy, audit and taxation sectors to support the Group’s strategy of becoming the leading advisor to the SME and not for profit sectors.

Engagement with employees

We care about all of our employees in the same way we care about our clients. When joining Dains staff  become part of a team of people who collaborate and innovate together during the working day, but who also enjoy spending time together outside of that to relax and have fun.
We believe our employees are our greatest asset, and we look to provide the best working environment, along with hybrid and smart working options and generous benefits. We listen, learn and evolve as we strive to make Dains a great place to work.
Everyone is treated with the same level of respect no matter what job title they have. We are all members of a team of people who are working together towards the same objective. So, if you need to ask a question or have a suggestion, you are encouraged to share it and get involved.
We strive to create a working environment that promotes and values diversity, where everyone feels empowered to be themselves. We are committed to equal opportunities and to build a more inclusive team that reflects the communities we serve and are continuously making progress. We welcome and encourage applications from all backgrounds, particularly candidates who are under-represented in Dains. These include people from Black, Asian, and ethnic minority backgrounds. The firm, in supplying services, is also committed against unlawful discrimination of clients or the public.
We engage with, consult and provide information to our staff through a variety of methods including staff newsletters, notice boards and regular office meetings to ensure we are delivering to their expectations, supporting wellbeing, and making the right business decisions. This ensures we can retain and develop the best talent.

Engagement with suppliers, customers and others

It is important we have a clear understanding of the challenges facing our clients and suppliers, as these may have a significant impact on the business in a variety of ways. We seek to have early visibility of potential opportunities or threats by maintaining close dialogue with existing clients and suppliers either by regular communication and meetings.

Page 6

 
Brewer Topco Limited
 

 
Directors' Report (continued)
For the Period Ended 31 March 2023

Disabled employees

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled every effort is made to ensure that their employment with the company continues and that appropriate training is arranged. It is the policy of the Group and the company that the training, career development and promotion of disabled persons should, as far as possible be identical to that of other employees.

Going concern

As noted in the strategic review, following the investment by Horizon capital the Group headed by Brewer Topco Limited is engaged in a strategy of growth, both organically and via acquisition. The Group has access to significant financial facilities from both the equity investor and the senior debt lender which is being deployed to fund this strategy.  Gross margins are strong and cash generation is excellent with Group EBITDA in the first period of trading of £6.25m. The directors’ and strategic reports further describe the financial position of the Group; its liquidity position; the Group’s objectives, policies, and processes for managing its capital; its financial risk management objectives; and its exposure to credit risk and liquidity risk.
The directors have prepared cashflow forecasts and projections for a period extending beyond twelve months from the date of approval of the financial statements which demonstrate that the Group can continue to trade within its available financial facilities. The directors therefore have a reasonable expectation that the Group 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 and thus they have concluded that it is reasonable to continue to prepare the financial statements on a going concern basis.

Greenhouse gas emissions, energy consumption and energy efficiency action

The Group's greenhouse gas emissions and energy consumption are as follows: 


2023

Emissions resulting from activities for which the Group is responsible involving the combustion of gas or consumption of fuel for the purposes of transport (in tonnes of CO2 equivalent)
88.645

Emissions resulting from the purchase of the electricity by the Group for its own use, including the purposes of transport (in tonnes of CO2 equivalent)
41.971

Energy consumed from activities for which the Group is responsible involving the combustion of gas, or the consumption of fuel for the purposes of transport, and the annual quantity of energy consumed resulting from the purchase of electricity by the Group for its own use, including for the purposes of transport, in kWh
559,919

All IPCC 2007 GHGs were considered in the calculation of this organisational carbon footprint, which were converted to carbon dioxide equivalents (CO2e) using the 2007 IPCC Global Warming Potentials (GWPs).

Intensity Ratio Measurement (Per tonne of Carbon Emissions Generated)
CO2e tonne generated per employee: 0.650
CO2e generated per property m2 (tonne) 0.056

Directors' responsibilities statement

The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 
Page 7

 
Brewer Topco Limited
 

 
Directors' Report (continued)
For the Period Ended 31 March 2023

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 the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


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

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditor is aware of that information.

Post balance sheet events

On 16 August 2023 the Group acquired Opto Group Limited, a specialist VAT and Employment tax advisory firm to the public sector and not for profit sector. 
On 31 August 2023 the Group acquired HSKS Greenhalgh Limited, a well-regarded accountancy, audit and taxation firm based in the East Midlands.

Auditor

Following a rebranding exercise on 15 May 2023 the trading name of the group’s independent auditor changed from MHA MacIntyre Hudson to MHA. MHA has indicated their willingness to continue in office and will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 6 October 2023 and signed on its behalf.
 





___________________________
R C McNeilly
Chief Executive Officer

Page 8

 
Brewer Topco Limited
 

 
Independent Auditor's Report to the Members of Brewer Topco Limited


Opinion


We have audited the financial statements of Brewer Topco Limited (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 31 March 2023, which comprise the Consolidated Profit and Loss Account, the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 Group's and of the parent Company's affairs as at 31 March 2023 and of the Group's loss for the period 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Group 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.


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 Group's or the parent 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.


Page 9

 
Brewer Topco Limited
 

 
Independent Auditor's Report to the Members of Brewer Topco Limited (continued)


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 ReportOur 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.


Opinion 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 Group Strategic Report and the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
the Group 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 Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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:


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 7, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 10

 
Brewer Topco Limited
 

 
Independent Auditor's Report to the Members of Brewer Topco Limited (continued)


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 Group 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:

Enquiry of management around actual and potential litigation and claims;
Enquiry of management to identify any instances of non-compliance with laws and regulations;
Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness;
Reviewing accounting estimates for evidence of management bias; and
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.


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 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 2006Our 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 Ramsey BSc (Hons) FCCA (Senior Statutory Auditor)
for and on behalf of
MHA
Statutory Auditor
Birmingham, United Kingdom

6 October 2023
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313)
Page 11

 
Brewer Topco Limited
 
 
Consolidated Profit and Loss Account
For the Period Ended 31 March 2023

2023
Note
£

  

Turnover
 4 
33,276,583

Cost of sales
  
(15,840,168)

Gross profit
  
17,436,415

Administrative expenses
  
(14,160,876)

Operating profit
 5 
3,275,539

Interest receivable and similar income
 9 
3,196

Interest payable and similar expenses
 10 
(3,004,751)

Profit before tax
  
273,984

Tax on profit
 11 
(785,652)

Loss for the financial 16 Month period
  
(511,668)

Loss for the 16 Month period attributable to:
  

Non-controlling interests
  
17,642

Owners of the parent
  
(529,310)

  
(511,668)

The notes on pages 22 to 47 form part of these financial statements.

Page 12

 
Brewer Topco Limited
 

Consolidated Statement of Comprehensive Income
For the Period Ended 31 March 2023

2023
£


Loss for the financial 16 Month period

  

(511,668)

Other comprehensive income
  


Non-controlling interest
  
278,861

Other comprehensive income for the period
  
278,861

Total comprehensive income for the period
  
(232,807)

Loss for the 16 Month period attributable to:
  


Non-controlling interest
  
17,642

Owners of the parent Company
  
(529,310)

  
(511,668)

Total comprehensive income attributable to:
  


Non-controlling interest
  
296,503

Owners of the parent Company
  
(529,310)

  
(232,807)

The notes on pages 22 to 47 form part of these financial statements.

Page 13

 
Brewer Topco Limited
Registered number:13667814

Consolidated Balance Sheet
As at 31 March 2023

2023
Note
£

Fixed assets
  

Intangible assets
 13 
27,573,981

Tangible assets
 14 
770,832

Investments
 15 
73,737

  
28,418,550

Current assets
  

Debtors
 16 
12,889,779

Cash at bank and in hand
 17 
5,443,493

  
18,333,272

Creditors: amounts falling due within one year
 18 
(11,358,201)

Net current assets
  
 
 
6,975,071

Total assets less current liabilities
  
35,393,621

Creditors: amounts falling due after more than one year
 19 
(33,542,428)

Provisions for liabilities
  

Deferred taxation
 21 
(129,000)

  
 
 
(129,000)

Net assets
  
1,722,193


Capital and reserves
  

Called up share capital 
 22 
19,550

Share premium account
 23 
1,935,450

Profit and loss account
 23 
(529,310)

Equity attributable to owners of the parent Company
  
1,425,690

Non-controlling interests
  
296,503

Total shareholders' funds
  
1,722,193


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 6 October 2023.




___________________________
R C McNeilly
Chief Executive Officer

The notes on pages 22 to 47 form part of these financial statements.
Page 14

 
Brewer Topco Limited
Registered number:13667814
    
Consolidated Balance Sheet (continued)
As at 31 March 2023


Page 15

 
Brewer Topco Limited
Registered number:13667814

Company Balance Sheet
As at 31 March 2023

2023
Note
£

Fixed assets
  

Investments
 15 
1

Current assets
  

Debtors
 16 
10,012,124

Cash at bank and in hand
 17 
1

  
10,012,125

Creditors: amounts falling due within one year
 18 
(758,910)

Net current assets
  
 
 
9,253,215

Total assets less current liabilities
  
9,253,216

  

Creditors: amounts falling due after more than one year
 19 
(6,971,272)

  

Net assets
  
2,281,944


Capital and reserves
  

Called up share capital 
 22 
19,550

Share premium account
 23 
1,935,450

Profit and loss account
 23 
326,944

Total shareholders' funds
  
2,281,944


The profit for the financial period dealt with in the financial statements of the parent company was £326,944. As permitted by Section 408 of the Companies Act 2006, no separate profit and loss account or statement of comprehensive income is presented in respect of the parent company
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 6 October 2023.


___________________________
R C McNeilly
Chief Executive Officer

The notes on pages 22 to 47 form part of these financial statements.

Page 16

 
Brewer Topco Limited
 

Consolidated Statement of Changes in Equity
For the Period Ended 31 March 2023


Called up share capital
Share premium account
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity

£
£
£
£
£
£


Comprehensive income for the period

Loss for the period
-
-
(529,310)
(529,310)
17,642
(511,668)

Non-controlling interest
-
-
-
-
278,861
278,861
Total comprehensive income for the period
-
-
(529,310)
(529,310)
296,503
(232,807)


Contributions by and distributions to owners

Shares issued during the period
19,550
1,935,450
-
1,955,000
-
1,955,000


Total transactions with owners
19,550
1,935,450
-
1,955,000
-
1,955,000


At 31 March 2023
19,550
1,935,450
(529,310)
1,425,690
296,503
1,722,193

The notes on pages 22 to 47 form part of these financial statements.

Page 17

 
Brewer Topco Limited
 

Company Statement of Changes in Equity
For the Period Ended 31 March 2023


Called up share capital
Share premium account
Profit and loss account
Total equity

£
£
£
£


Comprehensive income for the period

Profit for the period
-
-
326,944
326,944
Total comprehensive income for the period
-
-
326,944
326,944


Contributions by and distributions to owners

Shares issued during the period
19,550
1,935,450
-
1,955,000


Total transactions with owners
19,550
1,935,450
-
1,955,000


At 31 March 2023
19,550
1,935,450
326,944
2,281,944

The notes on pages 22 to 47 form part of these financial statements.

Page 18

 
Brewer Topco Limited
 

Consolidated Statement of Cash Flows
For the Period Ended 31 March 2023

2023
£

Cash flows from operating activities

Loss for the financial period
(511,668)

Adjustments for:

Amortisation of intangible assets
2,912,484

Depreciation of tangible assets
193,559

Loss on disposal of tangible assets
7,786

Interest paid
3,004,751

Interest received
(3,196)

Taxation charge
785,652

Increase in debtors
(3,523,793)

Increase in creditors
758,081

Net cash generated from operating activities

3,623,656


Cash flows from investing activities

Purchase of tangible fixed assets
(462,565)

Sale of tangible fixed assets
(281)

Purchase of fixed asset investments
(32,490,357)

Cash from acquisitions
2,065,828

Interest received
3,196

HP interest paid
(4,674)

Net cash from investing activities

(30,888,853)
Page 19

 
Brewer Topco Limited
 

Consolidated Statement of Cash Flows (continued)
For the Period Ended 31 March 2023


2023

£



Cash flows from financing activities

Issue of ordinary shares
1,955,000

New secured loans
13,639,199

Purchase of debenture loans
12,931,957

Repayment of/new finance leases
211,339

Issue of preference shares
6,971,272

Interest paid
(3,000,077)

Net cash used in financing activities
32,708,690

Net increase in cash and cash equivalents
5,443,493

Cash and cash equivalents at the end of period
5,443,493


Cash and cash equivalents at the end of period comprise:

Cash at bank and in hand
5,443,493

5,443,493


The notes on pages 22 to 47 form part of these financial statements.

Page 20

 
Brewer Topco Limited
 

Consolidated Analysis of Net Debt
For the Period Ended 31 March 2023




Cash flows
Acquisition of subsidiaries
At 31 March 2023
£

£

£

Cash at bank and in hand

3,377,665

2,065,828

5,443,493

Debt due after 1 year

(33,542,428)

-

(33,542,428)

Finance leases

(211,339)

-

(211,339)


(30,376,102)
2,065,828
(28,310,274)

The notes on pages 22 to 47 form part of these financial statements.

Page 21

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

1.


General information

Brewer Topco Limited ('the company') is a private company limited by shares, incorporated in the United Kingdom in England and Wales under the Companies Act. The address of the registered office is given on the company information page. The nature of the group's operations and its principal activities is the provision of accountancy, taxation and business advice services.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

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 Group management to exercise judgement in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and Loss Account in these financial statements.

The following principal accounting policies have been applied:

  
2.2

Financial reporting standard 102 - reduced disclosure exemptions

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);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47,11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in these consolidated financial statements.

 
2.3

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Profit and Loss Account from the date on which control is obtained. They are deconsolidated from the date control ceases.

Page 22

 
Brewer Topco Limited
 

 
Notes to the Financial Statements
For the Period Ended 31 March 2023

2.Accounting policies (continued)

 
2.4

Going concern

As noted in the strategic review, following the investment by Horizon capital the Group headed by Brewer Topco Limited is engaged in a strategy of growth, both organically and via acquisition. The Group has access to significant financial facilities from both the equity investor and the senior debt lender which is being deployed to fund this strategy. Gross margins are strong and cash generation is excellent with Group EBITDA in the first period of trading of £6.38m. The directors’ and strategic reports further describe the financial position of the Group; its liquidity position; the Group’s objectives, policies, and processes for managing its capital; its financial risk management objectives; and its exposure to credit risk and liquidity risk.
The directors have prepared cashflow forecasts and projections for a period extending beyond twelve months from the date of approval of the financial statements which demonstrate that the Group can continue to trade within its available financial facilities. The directors therefore have a reasonable expectation that the Group 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 and thus they have concluded that it is reasonable to continue to prepare the financial statements on a going concern basis.

 
2.5

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP and the financial statements are rounded to the nearest £.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

 
2.6

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 23

 
Brewer Topco Limited
 

 
Notes to the Financial Statements
For the Period Ended 31 March 2023

2.Accounting policies (continued)

 
2.7

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.8

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.9

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.10

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

 
2.11

Current and deferred taxation

The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of
Page 24

 
Brewer Topco Limited
 

 
Notes to the Financial Statements
For the Period Ended 31 March 2023

2.Accounting policies (continued)


2.11
Current and deferred taxation (continued)

assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.12

Intangible assets

Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Profit and Loss Account over its useful economic life of 10 years.

 
2.13

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

The estimated useful lives range as follows:

Leasehold improvements
-
10 years straight line
Fixtures and fittings
-
between 8 and 15 years straight line
Computer equipment
-
3 years straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.14

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.15

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Page 25

 
Brewer Topco Limited
 

 
Notes to the Financial Statements
For the Period Ended 31 March 2023

2.Accounting policies (continued)

 
2.16

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are 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.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.17

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.18

Holiday pay accrual

A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the balance sheet date.

 
2.19

Provisions for liabilities

Provisions are made where an event has taken place that gives the Group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance Sheet.

Page 26

 
Brewer Topco Limited
 

 
Notes to the Financial Statements
For the Period Ended 31 March 2023

2.Accounting policies (continued)

 
2.20

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Group's Balance Sheet when the Group becomes party to the contractual provisions of the instrument.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Page 27

 
Brewer Topco Limited
 

 
Notes to the Financial Statements
For the Period Ended 31 March 2023

2.Accounting policies (continued)

 
2.21

Dividends

Dividends on shares recognised as liabilities are recognised as expenses and classified within interest payable.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In the application of the group's accounting policies, which are described in note 2, the members are required to make judgements, estimates and assumptions about the carrying amounts 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 if the revision affects only that period, or in the period of revision and future periods if the revision affects both current and future periods.
Valuation of accrued revenue
In calculating revenue, the group makes certain estimates as to the stage of completion of those contracts. In doing so, the group estimates the remaining time and external costs to be incurred in completing contracts and clients' willingness and ability to pay from the services provided. A different assessment of the outturn on a contract may result in a different value being determined for revenue and also a different carrying value being determined for unbilled amounts for client work.
Trade debtors
The total carrying value of trade debtors and unbilled amounts for client work are net of impairment losses on trade debtors and after consideration to the clients' willingness to pay those amounts accrued in respect of incomplete contracts. A different assessment of the recoverability of either balance, with reference to either the ability or willingness of the client to pay, may result in different values being determined.
Impairment of Goodwill and investments
When considering any impairment of goodwill or investments, the Directors' use impairment models with detailed cash flow forecasts to determine the value in use of the assets. The impairment testing involves significant judgement as to whether the net present value of the estimated future cash flows can support the carrying value of the asset. The key assumptions utilised in determining these cash flows are the discount rate used and the long-term growth rate.


4.


Turnover

The whole of the turnover is attributable to the principal activity of the company.

All turnover arose within the United Kingdom.

Page 28

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

5.


Operating profit

The operating profit is stated after charging:

2023
£

Depreciation of tangible fixed assets
208,225

Amortisation of intangible fixed assets
2,912,484

Other operating lease rentals
646,209


6.


Auditor's remuneration

During the period, the Group obtained the following services from the Group's auditor and its associates:


2023
£

Fees payable to the group's auditor for the audit of the consolidated and subsidary entities financial statements

89,750

The auditor provides no non audit services.


7.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
Company
2023
2023
£
£


Wages and salaries
16,523,793
-

Social security costs
1,721,383
-

Cost of defined contribution scheme
774,436
-

19,019,612
-


The average monthly number of employees, including the directors, during the period was as follows:


        2023
            No.






Directors
9



Professional
295



Administration and support
50

354

Page 29

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

8.


Directors' remuneration

2023
£

Directors' emoluments
1,237,807

Group contributions to defined contribution pension schemes
66,641

1,304,448


During the period retirement benefits were accruing to 6 directors in respect of defined contribution pension schemes.

The highest paid director received remuneration of £243,333.

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £12,833.


9.


Interest receivable

2023
£


Other interest receivable
3,196

3,196


10.


Interest payable and similar expenses

2023
£


Bank interest payable
809,428

Other loan interest payable
1,431,740

Preference share dividends
758,909

Finance leases and hire purchase contracts
4,674

3,004,751

Page 30

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

11.


Taxation


2023
£

Corporation tax


Current tax on profits for the year
702,884


Total current tax
702,884

Deferred tax


Origination and reversal of timing differences
82,768

Total deferred tax
82,768


Tax on profit
785,652

Factors affecting tax charge for the period

The tax assessed for the period is higher than the standard rate of corporation tax in the UK of 19%. The differences are explained below:

2023
£


Profit before tax
273,984


Profit multiplied by standard rate of corporation tax in the UK of 19%
52,057

Effects of:


Non-tax deductible amortisation of goodwill
553,372

Expenses not deductible for tax purposes, other than goodwill amortisation
23,132

Fixed asset differences
77,944

Other timing differences
79,147

Total tax charge for the period
785,652

Page 31

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023
 
11.Taxation (continued)


Factors that may affect future tax charges

In the Spring Budget 2021, the government announced that from 1 April 2023 the headline corporation tax rate will increase to 25%. The proposal to increase the rate to 25% had been substantively enacted at the Group’s balance sheet date, therefore its effects have been included in these financial statements.
Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statement. There is no expiry date on timing differences, unused tax losses or tax credits.


12.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and Loss Account in these financial statements. The profit after tax of the parent Company for the period was £326,944.


13.


Intangible assets

Group




Goodwill

£



Cost


Additions
30,486,465



At 31 March 2023

30,486,465



Amortisation


Charge for the period
2,912,484



At 31 March 2023

2,912,484



Net book value



At 31 March 2023
27,573,981



Page 32

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

14.


Tangible fixed assets

Group






Leasehold improvements
Plant and machinery
Motor vehicles
Fixtures and fittings
Computer equipment
Total

£
£
£
£
£
£



Cost


Additions
57,279
-
-
64,709
340,577
462,565


On acquisition
59,287
56,000
21,961
889,482
1,122,513
2,149,243


Disposals
(15,129)
-
-
(64,108)
(98,758)
(177,995)



At 31 March 2023

101,437
56,000
21,961
890,083
1,364,332
2,433,813



Depreciation


Charge for the period on owned assets
9,967
3,267
-
75,922
74,625
163,781


Charge for the period on financed assets
-
-
-
-
29,778
29,778


On acquisition
23,760
25,200
21,961
574,712
994,279
1,639,912


Disposals
(12,620)
-
-
(59,112)
(98,758)
(170,490)



At 31 March 2023

21,107
28,467
21,961
591,522
999,924
1,662,981



Net book value



At 31 March 2023
80,330
27,533
-
298,561
364,408
770,832

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
£



Computer equipment
4,662

4,662

Page 33

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

15.


Fixed asset investments

Group





Unlisted investments

£



Cost


On acquisition
73,737



At 31 March 2023
73,737




Company





Investments in subsidiary companies

£



Cost


Additions
1



At 31 March 2023
1





16.


Debtors

Group
Company
2023
2023
£
£

Debtors falling due after more than one year

Amounts owed by group undertakings
-
10,012,124

-
10,012,124

Debtors falling due less than one year

Trade debtors
10,704,111
-

Other debtors
246,192
-

Called up share capital not paid
51
-

Prepayments and accrued income
1,939,425
-

12,889,779
10,012,124


Amounts owed by group undertakings are unsecured, carry interest at a rate of 10% with £1.5m being due for repayment in May 2028 and the balance being due for repayment in June 2028.

Page 34

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

17.


Cash and cash equivalents

Group
Company
2023
2023
£
£

Cash at bank and in hand
5,443,493
1

5,443,493
1



18.


Creditors: Amounts falling due within one year

Group
Company
2023
2023
£
£

Trade creditors
1,013,925
-

Corporation tax
809,067
-

Other taxation and social security
1,758,774
-

Obligations under finance lease and hire purchase contracts
211,339
-

Other creditors
4,888,255
-

Accruals and deferred income
2,676,841
758,910

11,358,201
758,910


Net obligations under finance leases and hire purchase contracts are secured on the assets to which they relate.

Page 35

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

19.


Creditors: Amounts falling due after more than one year

Group
Company
2023
2023
£
£

Debentures loans
12,931,957
-

Bank loans
13,639,199
-

Share capital treated as debt
6,971,272
6,971,272

33,542,428
6,971,272


Disclosure of the terms and conditions attached to the non-equity shares is made in note 22.

Loan notes are unsecured, carry interest an interest rate of 10% and are due for repayment in June 2028.
Bank loans comprise a term loan and an acquisition facility loan. All facilities are secured via a debenture over the assets of certain group companies. The term loan and acquisition facility loan carries a variable interest rate of between 3.75% and 4.75% above SONIA. The term loan is repayable in full in December 2027. The acquisition facility loan is repayable in quarterly installments of £1.875m from June 2025, with the remaining balance being due in full in December 2027.


20.


Loans


Analysis of the maturity of loans is given below:


Group
2023
£



Amounts falling due 2-5 years

Bank loans
7,500,000

Amounts falling due after more than 5 years

Bank loans
6,139,199

Debenture loans
12,931,957

26,571,156


Page 36

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

21.


Deferred taxation


Group



2023


£






Charged to profit or loss
(82,768)


On acquisition
(46,232)



At 31 March 2023
(129,000)

The deferred taxation balance is made up as follows:

Group
2023
£

Accelerated capital allowances
(133,000)

Short term timing differences
4,000

(129,000)

Page 37

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

22.


Share capital

2023
£
Shares classified as equity

Allotted, called up and fully paid


1,173,460 A Ordinary shares of £0.01 each
11,735
356,540 B Ordinary shares of £0.01 each
3,565
425,000 C Ordinary shares of £0.01 each
4,250

19,550

2023
£
Shares classified as debt

Allotted, called up and fully paid


5,471,272 A Preference shares of £1.00 each
5,471,272
1,500,000 B Preference shares of £1.00 each
1,500,000

6,971,272


Shares issued
On incorporation 1 A Ordinary share was issued at par.
On 14 December 2021, the 1 A Ordinary share was sub divided in to 100 £0.01 A ordinary shares. 
On 14 December 2021, 1,185,213 A Ordinary shares of £0.01 per share were issued at a premium of £0.99 per share, 344,687 B Ordinary shares of £0.01 per share were issued at a premium of £0.99 per share, 390,000 C Ordinary shares of £0.01 per share were issued at a premium of £0.99 per share and 5,471,272 Preference shares of £1.00 per share were issued at par. 
On 15 June 2022, 35,000 C Ordinary share of £0.01 per share were issued at a premium of £0.99 per share.
On 15 June 2022, 11,853 A Ordinary shares of £0.01 each were re designated as 11,853 B Ordinary shares of £0.01 each.
On 30 September 2022 the 5,471,272 Preference shares of £1.00 each were re-designated as 5,471,272 A Preference shares of £1.00 each.
On 30 September 2022 1,500,000 B Preference shares of £1.00 each were issued at par.
Rights of shares
A Ordinary shares
Each share is entitled to one vote per share held in any circumstances. Each share has rights to dividends. Each share is entitled to participate in a distribution (parri passu). Shares are not redeemable.
B Ordinary shares
Not entitled to any voting rights. Each share has rights to dividends. Each share is entitled to participate in a distribution (parri passu). Shares are not redeemable.
 
Page 38

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

22.Share capital (continued)

C Ordinary shares
Each share is entitled to one vote per share held in any circumstances. Each share has rights to dividends. Each share is entitled to participate in a distribution (parri passu). Shares are not redeemable.
A Preference shares
Not entitled to any voting rights. Each share has rights to dividends. Each share is entitled to a fixed rate cumulative preferential dividend at the annual rate of 10% of the issue price per preference share (excluding any associated tax credit) compounded annually on each anniversary of the adoption date which shall accrue daily and be calculated in respect of the period to such date assuming a 365-day year. Each share is liable to be redeemed.
B Preference shares
Not entitled to any voting rights. Each share has rights to dividends and shall rank behind the c preference shares and pari passu to the A preference shares. Each share is entitled to a fixed rate cumulative preferential dividend at the annual rate of 10% of the issue price per preference share (excluding any associated tax credit) compounded annually on each anniversary of the adoption date which shall accrue daily and be calculated in respect of the period to such date assuming a 365-day year. Each share is liable to be redeemed.


23.


Reserves

Share premium account

The share premium account represents the amount above the nominal value received for shares issued, less transaction costs.

Profit and loss account

The profit and loss account reserve represents cumulative profits and losses, net of dividends paid and other adjustments.

Page 39

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

24.
 

Business combinations

i) On 14 December 2021, the group acquired the entire issued share capital of Dains Accountants Limited. 

Acquisition of Dains Accountants Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
256,615
-
256,615

Investments
73,737
-
73,737

330,352
-
330,352

Current Assets

Debtors
5,395,901
-
5,395,901

Cash at bank and in hand
494,242
-
494,242

Total Assets
6,220,495
-
6,220,495

Creditors

Due within one year
(8,627,484)
-
(8,627,484)

Total Identifiable net liabilities
(2,406,989)
-
(2,406,989)


Goodwill
16,476,473

Total purchase consideration
14,069,484

Consideration

£


Cash
7,783,525

Equity instruments
814,687

Debt instruments
5,471,272

Total purchase consideration
14,069,484

Page 40

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

24.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
7,783,525

7,783,525

Less: Cash and cash equivalents acquired
(494,242)

Net cash outflow on acquisition
7,289,283

ii) On 30 June 20221 the group acquired the entire issued share capital of Barringtons Limited. On 4 September 2022, the trade, assets and liabilities of the company were transferred to Dains Accountants Limited and Barringtons Limited became dormant.

Acquisition of Barringtons Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
6,697
-
6,697

Intangible
51,554
-
51,554

58,251
-
58,251

Current Assets

Debtors
623,554
-
623,554

Cash at bank and in hand
149,642
-
149,642

Total Assets
831,447
-
831,447

Creditors

Due within one year
(362,129)
-
(362,129)

Deferred taxation
(935)
-
(935)

Total Identifiable net assets
468,383
-
468,383


Goodwill
1,717,587

Total purchase consideration
2,185,970

Page 41

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

24.Business combinations (continued)

Consideration

£


Cash
1,446,220

Deferred consideration
635,250

Directly attributable costs
104,500

Total purchase consideration
2,185,970

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
1,446,220

Directly attributable costs
104,500

1,550,720

Less: Cash and cash equivalents acquired
(149,642)

Net cash outflow on acquisition
1,401,078

Page 42

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

24.Business combinations (continued)

iii) On 2 September 2022 the group acquired the entire issued share capital of Isosceles Finance Limited.

Acquisition of Isosceles Finance Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
162,729
-
162,729

162,729
-
162,729

Current Assets

Debtors
663,167
-
663,167

Cash at bank and in hand
878,296
-
878,296

Total Assets
1,704,192
-
1,704,192

Creditors

Due within one year
(1,033,658)
-
(1,033,658)

Deferred taxation
(39,356)
-
(39,356)

Total Identifiable net assets
631,178
-
631,178


Goodwill
6,573,157

Total purchase consideration
7,204,335

Consideration

£


Cash
3,054,245

Contingent consideration
4,000,000

Directly attributable costs
150,090

Total purchase consideration
7,204,335

Page 43

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

24.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
3,054,245

Directly attributable costs
150,090

3,204,335

Less: Cash and cash equivalents acquired
(878,296)

Net cash outflow on acquisition
2,326,039

iv) On 30 September 2022 the group acquired the entire issued share capital of William Duncan + Co (Group) Limited.

Acquisition of William Duncan + Co (Group) Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
83,290
-
83,290

Intangible
466,375
-
466,375

549,665
-
549,665

Current Assets

Debtors
2,631,954
-
2,631,954

Cash at bank and in hand
543,648
-
543,648

Total Assets
3,725,267
-
3,725,267

Creditors

Due within one year
(408,006)
-
(408,006)

Deferred taxation
(5,941)
-
(5,941)

Total Identifiable net assets
3,311,320
-
3,311,320


Non-controlling interests
278,861

Goodwill
5,440,387

Total purchase consideration
9,030,568

Page 44

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

24.Business combinations (continued)

Consideration

£


Cash
6,085,185

Equity instruments
1,000,000

Debt instruments
1,500,000

Directly attributable costs
445,383

Total purchase consideration
9,030,568

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
6,085,185

Directly attributable costs
445,383

6,530,568

Less: Cash and cash equivalents acquired
(543,648)

Net cash outflow on acquisition
5,986,920


25.


Pension commitments

The group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £774,436. Contributions totalling £124,559 were payable to the fund at the balance sheet date and are included in creditors.


26.


Commitments under operating leases

At 31 March 2023 the Group  had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
2023
£

Not later than 1 year
492,481

Later than 1 year and not later than 5 years
994,416

Later than 5 years
297,500

1,784,397
Page 45

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

27.


Post balance sheet events

On 16 August 2023 the Group acquired Opto Group Limited, a specialist VAT and Employment tax advisory firm to the public sector and not for profit sector. 
On 31 August 2023 the Group acquired HSKS Greenhalgh Limited, a well-regarded accountancy, audit and taxation firm based in the East Midlands.


28.


Controlling party

At 31 March 2023, the Directors considered the ultimate controlling party to be Horizon Capital II Limited Partnership by virtue of their majority shareholding in the company.


29.



Subsidiary undertakings



Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Brewer Holdco Limited
Horizon Capital, Level 9 The Shard, 32 London Bridge Street, London, England, SE1 9SG
Ordinary
100%
Brewer Midco Limited*
Horizon Capital, Level 9 The Shard, 32 London Bridge Street, London, England, SE1 9SG
Ordinary
100%
Brewer Bidco Limited *
Horizon Capital, Level 9 The Shard, 32 London Bridge Street, London, England, SE1 9SG
Ordinary
100%
Dains Accountants Limited *
St. Johns Court, Wiltell Road, Lichfield, Staffordshire, WS14 9DS
Ordinary
100%
Dains Audit Limited *
St. Johns Court, Wiltell Road, Lichfield, Staffordshire, WS14 9DS
A Ordinary
100%
Dains LLP *
15 Colmore Row, Birmingham, B3 2BH
Member
100%
Isosceles Finance Limited *
One, High Street, Egham, England, TW20 9HJ
Ordinary
100%
Barringtons Limited *
St. Johns Court, Wiltell Road, Lichfield, Staffordshire, WS14 9DS
Ordinary
100%
Dains Trustees Limited *
15 Colmore Row, Birmingham, B3 2BH
Ordinary
100%
Dains Forensic LLP *
15 Colmore Row, Birmingham, B3 2BH
Member
100%
Page 46

 
Brewer Topco Limited
 
 

Notes to the Financial Statements
For the Period Ended 31 March 2023

29.Subsidiary undertakings (continued)

Subsidiary undertakings (continued)


Name

Registered office

Class of shares

Holding

McBrewer Bidco Limited *
Ellersley House, 30 Miller Road, Ayr, KA7 2AY
Ordinary
88.9%
William Duncan & Co (Group) Limited *
Ellersley House, 30 Miller Road, Ayr, KA7 2AY
Ordinary
100%
William Duncan + Co Limited *
Ellersley House, 30 Miller Road, Ayr, KA7 2AY
Ordinary
100%
William Duncan + Co (Audit) Limited *
Ellersley House, 30 Miller Road, Ayr, KA7 2AY
Ordinary
100%
William Duncan (Business Recovery) Limited *
Ellersley House, 30 Miller Road, Ayr, KA7 2AY
Ordinary
100%
Xtra Accounting Limited *
Ellersley House, 30 Miller Road, Ayr, KA7 2AY
Ordinary
100%

* Indirect subsidiary

 
Page 47