Company Registration No. 11239466 (England and Wales)
CIRCLE WASTE LIMITED
FINANCIAL STATEMENTS
FOR THE PERIOD ENDED
31 JANUARY 2023
Brightfield Business Hub
Bakewell Road
Orton Southgate
Peterborough
Cambridgeshire
PE2 6XU
CIRCLE WASTE LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 27
CIRCLE WASTE LIMITED
COMPANY INFORMATION
Directors
C F Dear
M W Garwood
Company number
11239466
Registered office
Unit 1A
Tottenhill Retail Park
Lynn Road, Tottenhill
Kings Lynn
Norfolk
PE33 0SR
Auditor
TC Group
Brightfield Business Hub
Bakewell Road
Orton Southgate
Peterborough
Cambridgeshire
PE2 6XU
CIRCLE WASTE LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 31 JANUARY 2023
- 1 -
The directors present the strategic report for the period ended 31 January 2023.
Fair review of the business
Circle Waste has witnessed significant growth and developments during the financial period.
Sales have grown by 38% (annualised growth) in the period, driven by increased demand across our commercial customer offering.
Significant development in all of the businesses operating and financial systems and the development of a senior management team have also been important. Those investments have now positioned the business perfectly for its next phase of growth.
Our further investment in developing the environmental based reporting for our customers, along with the development of our Total Waste Management offering, incorporating our commitment to sustainable waste management practices has also been vital.
Our commitment to continual and never ending improvement has been evident in the period in both sales growth and business practices.
Management Structure and Growth Preparation
During this period, we recognised the need to refine our management structure to accommodate the growing demands of our business. Our management team has grown, and we've empowered them to make strategic decisions that align with our growth objectives. This ensures that we have the leadership and direction needed to continue our growth.
In conclusion, Circle Waste is committed to delivering excellence in waste management, backed by strategic developments, robust financial performance, and a management structure ready to steer the company toward continued growth.
Principal risks and uncertainties
As with any business, we face risks and uncertainties with market volatility and regulatory changes specific to the waste management industry.
However, we have a proactive approach to mitigate these risks. We continuously monitor industry developments, adapt to changes swiftly, and maintain robust contingency plans. Our experienced team and strong supplier relationships are key assets in navigating these challenges.
Key performance indicators
The company's key financial and other performance indicators during the period were as follows:
Unit 2023 2021 Turnover £44,066,495 £21,905,035
Gross Profit £10,014,388 £4,378,745
GP Margin 22.7% 20.0%
Profit Before Tax £1,806,120 £483,239
C F Dear
Director
18 October 2023
CIRCLE WASTE LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 JANUARY 2023
- 2 -
The directors present their annual report and financial statements for the period ended 31 January 2023.
Principal activities
The principal activity of the company continued to be that of providing waste management services.
Results and dividends
The results for the period are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
C F Dear
M W Garwood
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
C F Dear
Director
18 October 2023
CIRCLE WASTE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE PERIOD ENDED 31 JANUARY 2023
- 3 -
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:
select suitable accounting policies 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 company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
CIRCLE WASTE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CIRCLE WASTE LIMITED
- 4 -
Opinion
We have audited the financial statements of Circle Waste Limited (the 'company') for the period ended 31 January 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 January 2023 and of its profit 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.
The prior year financial statements have not been audited, therefore the corresponding figures are unaudited.
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.
CIRCLE WASTE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CIRCLE WASTE LIMITED
- 5 -
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:
the information given in the 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 strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of 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, 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.
CIRCLE WASTE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CIRCLE WASTE LIMITED
- 6 -
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. 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.
The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.
Our approach was as follows:
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), and discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations;
We considered the legal and regulatory frameworks directly applicable to the financial statements reporting framework (FRS 102 and the Companies Act 2006) and the relevant tax compliance regulations in the UK;
We considered the nature of the industry, the control environment and business performance, including the key drivers for management’s remuneration;
We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit;
We considered the procedures and controls that the company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those programmes and controls.
CIRCLE WASTE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CIRCLE WASTE LIMITED
- 7 -
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.
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 planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-for-auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-for-audit.aspx. This description forms part of our auditor's 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.
Mitchell Burden (Senior Statutory Auditor)
For and on behalf of TC Group
18 October 2023
Statutory Auditor
Office: Peterborough
CIRCLE WASTE LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 31 JANUARY 2023
- 8 -
Year
ended
1 August 2021
31 July
to 31 January 2023
2021 as restated
Notes
£
£
Turnover
3
44,066,495
21,905,035
Cost of sales
(34,052,107)
(17,526,290)
Gross profit
10,014,388
4,378,745
Administrative expenses
(8,106,927)
(3,891,604)
Operating profit
4
1,907,461
487,141
Interest payable and similar expenses
6
(101,341)
(3,902)
Profit before taxation
1,806,120
483,239
Tax on profit
7
(182,076)
(106,942)
Profit for the financial period
1,624,044
376,297
The profit and loss account has been prepared on the basis that all operations are continuing operations.
CIRCLE WASTE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 JANUARY 2023
- 9 -
Year
ended
1 August 2021
31 July
to 31 January
2021 as
2023
restated
£
£
Profit for the period
1,624,044
376,297
Other comprehensive income
-
-
Total comprehensive income for the period
1,624,044
376,297
CIRCLE WASTE LIMITED
BALANCE SHEET
AS AT
31 JANUARY 2023
31 January 2023
- 10 -
31 January 2023
31 July 2021
as restated
Notes
£
£
£
£
Fixed assets
Intangible assets
9
167,250
Tangible assets
10
1,058,905
473,477
1,226,155
473,477
Current assets
Debtors
11
4,960,021
3,046,276
Cash at bank and in hand
2,692,411
2,198,260
7,652,432
5,244,536
Creditors: amounts falling due within one year
12
(6,754,686)
(5,300,828)
Net current assets/(liabilities)
897,746
(56,292)
Total assets less current liabilities
2,123,901
417,185
Creditors: amounts falling due after more than one year
13
(140,235)
(63,435)
Provisions for liabilities
Deferred tax liability
16
142,679
136,807
(142,679)
(136,807)
Net assets
1,840,987
216,943
Capital and reserves
Called up share capital
18
206
206
Profit and loss reserves
19
1,840,781
216,737
Total equity
1,840,987
216,943
The financial statements were approved by the board of directors and authorised for issue on 18 October 2023 and are signed on its behalf by:
C F Dear
Director
Company Registration No. 11239466
CIRCLE WASTE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 JANUARY 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 August 2020
206
190,440
190,646
Year ended 31 July 2021:
Profit and total comprehensive income for the year
-
376,297
376,297
Dividends
8
-
(350,000)
(350,000)
Balance at 31 July 2021
206
216,737
216,943
Period ended 31 January 2023:
Profit and total comprehensive income for the period
-
1,624,044
1,624,044
Balance at 31 January 2023
206
1,840,781
1,840,987
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 JANUARY 2023
- 12 -
1
Accounting policies
Company information
Circle Waste Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 1A, Tottenhill Retail Park, Lynn Road, Tottenhill, Kings Lynn, Norfolk, PE33 0SR.
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 under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. 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
Reporting period
The companies reporting period was extended from 31 July to 31 January. Therefore these accounts are for an 18 months period and the comparative amounts presented in the financial statements and the related notes are not entirely comparable. The reason for extending the accounting period was because an accounting system change that took place on the 1 February therefore it was decided to change the year end to facilitate this.
1.4
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.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 13 -
Revenue from contracts for the provision of professional 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. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.5
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation 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:
Software
20% straight line per annum
1.6
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 land and buildings
10% straight line per annum
Computers
20% straight line per annum
Motor vehicles
20% straight line per annum
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.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 14 -
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
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.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 15 -
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.
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.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
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.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 16 -
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.
1.10
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.
1.11
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.
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.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 17 -
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
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.
1.15
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.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
1
Accounting policies
(Continued)
- 18 -
1.16
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Winterberry Group Limited. These consolidated financial statements are available from its registered office, 9/10 The Crescent, Wisbech, Cambridgeshire, United Kingdom, PE13 1EH.
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.
3
Turnover and other revenue
2023
2021
£
£
Turnover analysed by class of business
Waste management services
44,066,495
21,905,035
All turnover is derived within the United Kingdom.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 19 -
4
Operating profit
2023
2021
Operating profit for the period is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
20,000
Depreciation of owned tangible fixed assets
273,560
68,074
Profit on disposal of tangible fixed assets
(1,627)
-
Amortisation of intangible assets
90,057
-
Operating lease charges
263,123
96,852
5
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2023
2021
Number
Number
96
73
Their aggregate remuneration comprised:
2023
2021
£
£
Wages and salaries
3,563,242
1,574,127
Social security costs
342,327
123,198
Pension costs
60,761
21,359
3,966,330
1,718,684
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 20 -
6
Interest payable and similar expenses
2023
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
207
Interest on invoice finance arrangements
91,482
91,482
207
Other finance costs:
Interest on finance leases and hire purchase contracts
8,931
3,450
Other interest
928
245
101,341
3,902
7
Taxation
2023
2021
£
£
Current tax
UK corporation tax on profits for the current period
287,548
23,700
Adjustments in respect of prior periods
(111,344)
Total current tax
176,204
23,700
Deferred tax
Origination and reversal of timing differences
5,872
83,242
Total tax charge
182,076
106,942
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
7
Taxation
(Continued)
- 21 -
The actual charge for the period can be reconciled to the expected charge for the period based on the profit or loss and the standard rate of tax as follows:
2023
2021
£
£
Profit before taxation
1,806,120
483,239
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
343,163
91,815
Tax effect of expenses that are not deductible in determining taxable profit
(43,193)
92
Permanent capital allowances in excess of depreciation
(6,550)
15,035
Under/(over) provided in prior years
(111,344)
Taxation charge for the period
182,076
106,942
8
Dividends
2023
2021
£
£
Interim paid
350,000
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 22 -
9
Intangible fixed assets
Software
£
Cost
At 1 August 2021
Additions
257,307
At 31 January 2023
257,307
Amortisation and impairment
At 1 August 2021
Amortisation charged for the period
90,057
At 31 January 2023
90,057
Carrying amount
At 31 January 2023
167,250
At 31 July 2021
10
Tangible fixed assets
Leasehold land and buildings
Computers
Motor vehicles
Total
£
£
£
£
Cost
At 1 August 2021
221,683
326,759
10,251
558,693
Additions
423,246
243,913
206,774
873,933
Disposals
(19,494)
(19,494)
At 31 January 2023
644,929
570,672
197,531
1,413,132
Depreciation and impairment
At 1 August 2021
23,808
59,358
2,050
85,216
Depreciation charged in the period
80,656
159,533
33,371
273,560
Eliminated in respect of disposals
(4,549)
(4,549)
At 31 January 2023
104,464
218,891
30,872
354,227
Carrying amount
At 31 January 2023
540,465
351,781
166,659
1,058,905
At 31 July 2021
197,875
267,401
8,201
473,477
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
10
Tangible fixed assets
(Continued)
- 23 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2021
£
£
Assets held under finance leases and hire purchase contracts
203,861
50,133
11
Debtors
2023
2021
Amounts falling due within one year:
£
£
Trade debtors
2,959,414
2,832,923
Amounts owed by group undertakings
1,188,736
162,948
Other debtors
499,467
205
Prepayments and accrued income
312,404
50,200
4,960,021
3,046,276
12
Creditors: amounts falling due within one year
2023
2021
Notes
£
£
Bank loans
14
10,000
10,000
Obligations under finance leases
15
59,218
10,151
Other borrowings
14
1,435,065
451,991
Trade creditors
3,951,647
1,391,775
Amounts owed to group undertakings
75,453
Corporation tax
24,499
23,835
Other taxation and social security
462,080
598,788
Other creditors
204
113
Accruals and deferred income
736,520
2,814,175
6,754,686
5,300,828
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 24 -
13
Creditors: amounts falling due after more than one year
2023
2021
Notes
£
£
Bank loans and overdrafts
14
25,289
38,333
Obligations under finance leases
15
114,946
25,102
140,235
63,435
14
Loans and overdrafts
2023
2021
£
£
Bank loans
35,289
48,333
Other loans
1,435,065
451,991
1,470,354
500,324
Payable within one year
1,445,065
461,991
Payable after one year
25,289
38,333
Other loans consist of an invoice discounting facility. Trade debtors are subject to an invoice discounting facility whereby an advance is received upon, and secured upon, trade debtors. The company has retained significant risks and rewards relating to the discounted debts and separate presentation has been adopted whereby the gross debt and a corresponding liability in respect of the advance received is shown separately on the Balance Sheet. The interest element of the invoice discounter's charge is recognised as it accrues and is included in the Profit and Loss Account.
15
Finance lease obligations
2023
2021
Future minimum lease payments due under finance leases:
£
£
Within one year
59,218
10,151
In two to five years
114,946
25,102
174,164
35,253
Obligations under finance lease and hire purchase contracts are secured against the assets concerned.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 25 -
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2021
Balances:
£
£
Accelerated capital allowances
142,679
136,807
Movements in the period:
£
Liability at 1 August 2021
136,807
Charge to profit or loss
5,872
Liability at 31 January 2023
142,679
17
Retirement benefit schemes
2023
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
60,761
21,359
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.
18
Share capital
2023
2021
2023
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
A Ordinary shares of £1 each
106
106
106
106
B Ordinary shares of £1 each
100
100
100
100
206
206
206
206
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 26 -
19
Reserves
Share capital
Represents the nominal value of shares that have been issued.
Profit and loss account
Includes all current and prior period retained profits and losses.
20
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
2021
£
£
Within one year
131,333
30,000
Between two and five years
579,333
325,875
In over five years
491,292
1,201,958
355,875
The amount of non-cancellable operating lease payments recognised as an expense during the year was £49,750 (2021 - £12,000).
21
Related party transactions
In accordance with FRS 102 section 33.1A 'Related Party Disclosures', the company has applied the exemption from disclosing transactions and balances with fellow wholly owned group undertakings.
22
Control
The company's immediate parent is Vision Corporate Services Group Limited (registered number 10573356), incorporated in England & Wales.
The ultimate parent company is Winterberry Group Limited (registered number 11372770), incorporated in England & Wales. The registered office of Winterberry Group Limited is 9/10 The Crescent, Wisbech, Cambs, United Kingdom, PE13 1EH. Consolidated financial statements of Winterberry Group Limited can be obtained from this address.
The ultimate controlling party is Christopher Dear.
CIRCLE WASTE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 JANUARY 2023
- 27 -
23
Prior period adjustment
There have been five prior period adjustments in relation to the year ended 31 July 2021.
The first adjustments was to debit Cost of sales £873,003, debit Profit and loss reserves £213,923 and credit Accruals £1,050,926. This adjustment reduced profits available for distribution by £1,050,926. The adjustment has been made to correct the cost of sales which contained errors, mostly of which being an under accrual of cost of sales invoices.
The second adjustment was to debit Sales £200,000, debit Other taxation and social security £40,000 and credit Cash at bank £240,000. This adjustment reduced profits available for distribution by £200,000. The adjustment has been made to correct the Credit Card control balance.
The third adjustment was to debit Administrative costs £134,467 and credit Trade debtors £134,467. This adjustment reduced profits available for distribution by £134,467. The adjustment has been made to correct the trade debtors to remove bad debts.
The fourth adjustment was to debit Administrative costs £324,123 and Tangible fixed assets £324,123. This adjustment reduced profits available for distribution by £324,123. The adjustment has been made to remove fixed assets that were incorrectly capitalised.
The fifth adjustment was to debit Corporation tax (Balance Sheet) £263,049 and credit Tax on profit £263,049. This adjustment increases profits available for distribution by £263,049. The adjustment has been made to take into account the tax effects on the prior period adjustments that have been made.
There has been one prior period adjustment made in relation to the year ended 31 July 2020.
This adjustment was to debit Cost of sales £213,923 and credit Accruals £213,923. This adjustment reduced profits available for distribution by £213,923 however this adjustment relates to ‘the first’ prior period adjustment for 31 July 2021 (see above) and the £213,923 reduction in profits available for distribution is included within the £1,050,926. This adjustment has been made to correct the cost of sales which contained errors, mostly of which being an under accrual of cost of sales invoices.
In total these prior period adjustments reduce the profits available for distribution by £1,446,467.
2023-01-312021-08-01falseCCH SoftwareCCH Accounts Production 2023.200C F DearM W Garwood1624044112394662021-08-012023-01-3111239466bus:Director12021-08-012023-01-3111239466bus:Director22021-08-012023-01-3111239466bus:RegisteredOffice2021-08-012023-01-31112394662023-01-31112394662020-08-012021-07-3111239466bus:OrdinaryShareClass12020-08-012021-07-3111239466core:ContinuingOperations2021-08-012023-01-3111239466core:RetainedEarningsAccumulatedLosses2020-08-012021-07-3111239466core:RetainedEarningsAccumulatedLosses2021-08-012023-01-3111239466core:OtherResidualIntangibleAssets2023-01-3111239466core:OtherResidualIntangibleAssets2021-07-3111239466core:ComputerSoftware2023-01-3111239466core:ComputerSoftware2021-07-31112394662021-07-3111239466core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-01-3111239466core:ComputerEquipment2023-01-3111239466core:MotorVehicles2023-01-3111239466core:LandBuildingscore:LeasedAssetsHeldAsLessee2021-07-3111239466core:ComputerEquipment2021-07-3111239466core:MotorVehicles2021-07-3111239466core:CurrentFinancialInstrumentscore:WithinOneYear2023-01-3111239466core:CurrentFinancialInstrumentscore:WithinOneYear2021-07-3111239466core:Non-currentFinancialInstrumentscore:AfterOneYear2023-01-3111239466core:Non-currentFinancialInstrumentscore:AfterOneYear2021-07-3111239466core:CurrentFinancialInstruments2023-01-3111239466core:CurrentFinancialInstruments2021-07-3111239466core:Non-currentFinancialInstruments2023-01-3111239466core:Non-currentFinancialInstruments2021-07-3111239466core:ShareCapital2023-01-3111239466core:ShareCapital2021-07-3111239466core:RetainedEarningsAccumulatedLosses2023-01-3111239466core:RetainedEarningsAccumulatedLosses2021-07-3111239466core:ShareCapital2020-07-3111239466core:RetainedEarningsAccumulatedLosses2020-07-31112394662020-07-3111239466core:ShareCapitalOrdinaryShares2023-01-3111239466core:ShareCapitalOrdinaryShares2021-07-3111239466core:IntangibleAssetsOtherThanGoodwill2021-08-012023-01-3111239466core:ComputerSoftware2021-08-012023-01-3111239466core:LandBuildingscore:LongLeaseholdAssets2021-08-012023-01-3111239466core:ComputerEquipment2021-08-012023-01-3111239466core:MotorVehicles2021-08-012023-01-311123946612021-08-012023-01-311123946612020-08-012021-07-3111239466core:UKTax2021-08-012023-01-3111239466core:UKTax2020-08-012021-07-3111239466core:ComputerSoftware2021-07-3111239466core:ComputerSoftwarecore:ExternallyAcquiredIntangibleAssets2021-08-012023-01-3111239466core:LandBuildingscore:LeasedAssetsHeldAsLessee2021-07-3111239466core:ComputerEquipment2021-07-3111239466core:MotorVehicles2021-07-31112394662021-07-3111239466core:LandBuildingscore:LeasedAssetsHeldAsLessee2021-08-012023-01-3111239466core:WithinOneYear2023-01-3111239466core:WithinOneYear2021-07-3111239466core:BetweenTwoFiveYears2023-01-3111239466core:BetweenTwoFiveYears2021-07-3111239466core:MoreThanFiveYears2023-01-3111239466core:MoreThanFiveYears2021-07-3111239466bus:PrivateLimitedCompanyLtd2021-08-012023-01-3111239466bus:FRS1022021-08-012023-01-3111239466bus:Audited2021-08-012023-01-3111239466bus:FullAccounts2021-08-012023-01-31xbrli:purexbrli:sharesiso4217:GBP