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Royle Recruitment Limited

Registered number: 09418230
Annual report and
 financial statements
For the year ended 28 February 2023

 
ROYLE RECRUITMENT LIMITED
 
 
COMPANY INFORMATION


Directors
J R Craven 
P Aston 
L G Aston 
F J Craven 
V McLeod 




Registered number
09418230



Registered office
Studio 3.02
Regency House

Westminster Place

York

North Yorkshire

YO26 6RW




Independent auditor
Parsons Accountants Ltd
Chartered Accountants & Statutory Auditor

No. 2 Silkwood Office Park

Fryers Way

Wakefield

West Yorkshire

WF5 9TJ





 
ROYLE RECRUITMENT LIMITED
 

CONTENTS



Page
Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditor's Report
 
5 - 8
Statement of Comprehensive Income
 
9
Statement of Financial Position
 
10
Statement of Changes in Equity
 
11
Statement of Cash Flows
 
12
Notes to the Financial Statements
 
13 - 28

 
ROYLE RECRUITMENT LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2023

Introduction
 
The Directors present their Strategic Report for the year ended 28 February 2023.

Business review
 
The Company's principal activities are an Recruitment Agency placing skilled individuals into temporary roles within the energy sector. The directors consider one of the Company’s main USP’s to be providing a high-class service to candidates and clients alike, offering excellent rates to candidates and competitive margins to clients.
This, in the view of the directors, will provide the best foundations for long-term sustainability and growth of the Company.
The Company's trading results are set out in the accounts and the Directors are satisfied with the performance in the year. 
During the year, the business' turnover decreased to £8.0m (2022: £10.3m) and gross profit decreased to £0.7m (2022: £0.8m). The results were affected by the cyclical nature of activity with some key customers and the number of planned shut downs these customers undertook during the year. The gross profit percentage is consistent year on year and the reduction in gross margin is directly attributable to the revenue reduction.
There were no significant changes to the Company's principal activities in the year under review, and the directors are not aware, at the date of this report, of any likely major changes in the Company's activities in the next year.

Principal risks and uncertainties
 
Any downturn in the economic environment has historically been the greatest risk to the service sector in which Royle Recruitment Limited operates.
Economic impact of global events
UK businesses are currently facing many uncertainties such as the consequences of Brexit, Covid 19, environmental sustainability and geopolitical events such as the Russian invasion of Ukraine. These uncertainties have contributed to an environment where there exists a range of issues and risks, including inflation, rising interest rates, labour shortages, disrupted supply chains and new ways of working. 
The Directors have carried out an assessment of the potential impact of these uncertainties on the business, including the impact of mitigation measures, and have concluded that the greatest impact on the business is  expected to be from the economic ripple effect on the global economy. The Directors have taken account of these potential impacts in their going concern assessment.
The Company continues to work with its partners to minimise any impacts of these events and maximise the realisation of any opportunities they may provide to the business.

Financial risks facing the Company
 
The directors have reviewed the nature of the Company’s business and the assets and liabilities contained within the balance sheet and consider the only relevant financial risk to the business to be credit risk. This risk is mitigated by credit checking clients and a strong credit control function. Bad debt exposure is minimised due to our clients being predominantly large FTSE 250, or overseas equivalent, utility companies.

- 1 -

 
ROYLE RECRUITMENT LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023

Financial key performance indicators


28 February 2023
£
28 February 2022
£



Turnover
8,046,484
10,250,727
Gross Profit
676,506
845,607
Gross Profit %
8.4
8.2
Administrative expenses
(545,290)
(554,324)


Future Developments

The Company continues to invest in its people and operational processes to continually improve both the customer experience and the experience for those providing agency labour. The Company remains open to opportunities which would widen the customer base and create operational efficiencies in the pursuit of achieving long term goals.

Other key performance indicators
 
The directors consider there to be no other key performance indicators.


This report was approved by the board on 18 October 2023 and signed on its behalf.



J R Craven
Director
- 2 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2023

The directors present their report and the financial statements for the year ended 28 February 2023.

Directors' responsibilities statement

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

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


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

make judgments and accounting estimates that are reasonable and prudent; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £42,895 (2022 - £205,079).

During the year the Company paid interim dividends of £209,394 (2022: £422,652). A final dividend of £Nil is proposed (2022: £Nil).

Directors

The directors who served during the year were:

J R Craven 
P Aston 
L G Aston 
F J Craven 
V McLeod 
- 3 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023

Going concern
These financial statements have been prepared on a going concern basis. The current economic conditions present risks for all businesses. In response to such conditions, the directors have carefully considered these risks, including an assessment of uncertainty on future trading projections for a period of at least 12 months from the date of signing the financial statements, and the extent to which they might affect the preparation of the financial statements on a going concern basis. 
Based on this assessment, the directors consider that the Company maintains an appropriate level of liquidity sufficient to meet the demands of the business. The Company has banking facilities available to it to cover any funding requirements it might have. The Balance Sheet is strong reflecting a net current asset position.
The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future and that there are no material uncertainties that lead to significant doubt upon the Company's ability to continue as a going concern. Thus the directors have continued to adopt the going concern basis of accounting in preparing these financial statements.

Matters covered in the Strategic Report

The directors have elected under section 414c of the Companies Act 2006 not to disclose the future development information on the basis that it is covered in the Strategic Report on page 2.

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'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's auditor is aware of that information.

Post balance sheet events

Post year-end dividends were declared of £22,275 (2022: £Nil).

Auditor

The auditor, Parsons Accountants Ltdwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 18 October 2023 and signed on its behalf.
 





J R Craven
Director
- 4 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROYLE RECRUITMENT LIMITED
 

Opinion


We have audited the financial statements of Royle Recruitment Limited (the 'Company') for the year ended 28 February 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and notes to the financial statements, 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 Company's affairs as at 28 February 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 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 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.


- 5 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROYLE RECRUITMENT 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 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.


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 Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.


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


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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.


- 6 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROYLE RECRUITMENT 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 financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures, in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
The extent to which the audit was considered capable of detecting irregularities, including fraud
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
the engagement partner ensured that the engagement team collectively had the appropriate competence,  capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
 we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the industry;
 we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, anti-bribery, employment and health and safety legislation;
 we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
 identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
 
- 7 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ROYLE RECRUITMENT LIMITED (CONTINUED)


We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
 making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
 considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
 performed analytical procedures to identify any unusual or unexpected relationships;
 tested journal entries to identify unusual transactions;
 assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
 investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
 agreeing financial statement disclosures to underlying supporting documentation;
 enquiring of management as to actual and potential litigation and claims; and
 reviewing correspondence with HMRC, relevant regulators and the company’s legal advisors, where applicable.


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.


Richard Walker (Senior Statutory Auditor)
  
for and on behalf of
Parsons Accountants Ltd
 
Chartered Accountants
Statutory Auditor
  
No. 2 Silkwood Office Park
Fryers Way
Wakefield
West Yorkshire
WF5 9TJ

19 October 2023
- 8 -

 
ROYLE RECRUITMENT LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 28 FEBRUARY 2023

2023
2022
Note
 £
£

  

Turnover
 4 
8,046,484
10,250,727

Cost of sales
  
(7,369,978)
(9,428,437)

Other income
 5 
-
23,317

Gross profit
  
676,506
845,607

Administrative expenses
  
(545,290)
(554,324)

Exceptional administrative expenses
 12 
(45,172)
-

Operating profit
 6 
86,044
291,283

Tax on profit
 10 
(43,149)
(86,204)

Profit for the financial year
  
42,895
205,079

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

There was no other comprehensive income for 2023 (2022: £NIL).

The notes on pages 13 to 28 form part of these financial statements.
- 9 -

 
ROYLE RECRUITMENT LIMITED
REGISTERED NUMBER: 09418230

STATEMENT OF FINANCIAL POSITION
AS AT 28 FEBRUARY 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 13 
441,627
607,238

Tangible assets
 14 
19,139
20,425

  
460,766
627,663

Current assets
  

Debtors: amounts falling due within one year
 15 
616,985
1,149,603

Cash at bank and in hand
 16 
131,642
19,279

  
748,627
1,168,882

Creditors: amounts falling due within one year
 17 
(563,107)
(983,760)

Net current assets
  
 
 
185,520
 
 
185,122

Total assets less current liabilities
  
646,286
812,785

  

Net assets
  
646,286
812,785


Capital and reserves
  

Called up share capital 
 19 
240
240

Profit and loss account
 20 
646,046
812,545

  
646,286
812,785


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 18 October 2023.


J R Craven
Director

The notes on pages 13 to 28 form part of these financial statements.

- 10 -

 
ROYLE RECRUITMENT LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 28 FEBRUARY 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 March 2021
240
1,030,118
1,030,358


Comprehensive income for the year

Profit for the year
-
205,079
205,079
Total comprehensive income for the year
-
205,079
205,079


Transactions with owners

Dividends: Equity capital
-
(422,652)
(422,652)


Total transactions with owners
-
(422,652)
(422,652)



At 1 March 2022
240
812,545
812,785


Comprehensive income for the year

Profit for the year
-
42,895
42,895
Total comprehensive income for the year
-
42,895
42,895


Transactions with owners

Dividends: Equity capital
-
(209,394)
(209,394)


Total transactions with owners
-
(209,394)
(209,394)


At 28 February 2023
240
646,046
646,286


The notes on pages 13 to 28 form part of these financial statements.
- 11 -

 
ROYLE RECRUITMENT LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 28 FEBRUARY 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
42,895
205,079

Adjustments for:

Amortisation of intangible assets
165,611
165,611

Depreciation of tangible assets
3,378
3,604

Taxation charge
43,149
86,204

Decrease in debtors
253,804
30,061

Decrease in creditors
(137,383)
(228,812)

Corporation tax paid
(90,501)
(56,729)

Net cash generated from operating activities

280,953
205,018


Cash flows from investing activities

Purchase of tangible fixed assets
(2,092)
-

Net cash from investing activities

(2,092)
-

Cash flows from financing activities

Movement in directors' loan accounts
332,028
(3,959)

Dividends paid
(209,394)
(422,652)

Net cash used in financing activities
122,634
(426,611)

Net increase/(decrease) in cash and cash equivalents
401,495
(221,593)

Cash and cash equivalents at beginning of year
(334,943)
(113,350)

Cash and cash equivalents at the end of year
66,552
(334,943)


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
131,642
19,279

Bank overdrafts
(65,090)
(354,222)

66,552
(334,943)


- 12 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

1.


General information

Royle Recruitment Limited ("the Company") is a private company, limited by shares and registered in England and Wales, registered number 09418230. The address of the registered office is Studio 3.02, Regency House, Westminster Place, York, North Yorkshire, YO26 6RW.
The principal activity of the Company is that of a Recruitment Agency placing skilled individuals into temporary roles within the energy sector.

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

These financial statements have been presented in pound sterling which is the functional currency of the Company, and rounded to the nearest £.

The following principal accounting policies have been applied:

 
2.2

Going concern

These financial statements have been prepared on a going concern basis. The current economic conditions present risks for all businesses. In response to such conditions, the directors have carefully considered these risks, including an assessment of uncertainty on future trading projections for a period of at least 12 months from the date of signing the financial statements, and the extent to which they might affect the preparation of the financial statements on a going concern basis. 
Based on this assessment, the directors consider that the Company maintains an appropriate level of liquidity sufficient to meet the demands of the business. The Company has banking facilities available to it to cover any funding requirements it might have. The Balance Sheet is strong reflecting a net current asset position.
The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future and that there are no material uncertainties that lead to significant doubt upon the Company's ability to continue as a going concern. Thus the directors have continued to adopt the going concern basis of accounting in preparing these financial statements.

- 13 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company 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.
Turnover arising from the recruitment of temporary placements is recognised across the period within which the temporary work is provided. The company acts as the principal in this transaction and therefore turnover represents amounts billed for the services of the temporary workers, including remuneration costs of the temporary workers and commission.
The Company also provides payroll bureau services. In these transactions the Company acts as the agent and therefore turnover for these services represent commissions receivable only.

 
2.4

Operating leases: the Company 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.

 
2.5

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.

 
2.6

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.7

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company 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 Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

- 14 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

2.Accounting policies (continued)

 
2.8

Current and deferred taxation

The tax expense for the year 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 reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised, where material, in respect of all material timing differences that have originated but not reversed by the Statement of Financial position date.

 
2.9

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.

 
2.10

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 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 Statement of Comprehensive Income over its useful economic life and is charged to the administrative expense in the Statement of Comprehensive Income.

 The estimated useful lives range as follows:

Goodwill
-
10
years

 
2.11

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.

- 15 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

2.Accounting policies (continued)


2.11
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following bases.

Depreciation is provided on the following basis:

Office equipment
-
15%
reducing balance

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. Depreciation is charged to the administrative expenses in the Statement of Comprehensive Income.

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

 
2.12

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.

 
2.13

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 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 Company's cash management.

 
2.14

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.

- 16 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

2.Accounting policies (continued)

  
2.15

Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
Financial assets and liabilities are offset and the net amount reported in the Statement of Financial Position when there is an enforceable right to set off the recognsied amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

 
2.16

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company 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 Company becomes aware of the obligation, and are measured at the best estimate at the reporting 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 Statement of Financial Position.

 
2.17

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

- 17 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are detailed below.
Assessing impairment indicators
In assessing whether there have been any indicators of impairment of assets, the directors have considered both external and internal sources of information such as market conditions and experience of recoverability and where applicable, the ability of the asset to be operated as planned. 
No impairment indicators were noted during the year.
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
(1) Amortisation of intangible fixed assets
The Company has estimated a useful life of 10 years to the goodwill created on the acquisition of the trade and assets of a business in 2015. This estimate was based upon information available at the time the assets were acquired and managements estimate of how long these would continue to be in use by the business. Management are satisfied that the useful economic life remains appropriate.
In addition to the annual amortisation charge management continually reviews the goodwill for indicators of impairment. Management have considered whether the underlying trade and assets continues to meet the performance objectives set by management. Management are satisfied no indicators of impairment existed at the year end. 


4.


Turnover

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

Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
8,046,484
10,233,552

Rest of Europe
-
17,175

8,046,484
10,250,727



5.


Other income

2023
2022
£
£

Government grants receivable
-
23,317


- 18 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible assets
3,378
3,604

Amortisation of intangible assets
165,611
165,611

Other operating lease rentals
37,677
1,020

Pension costs
45,843
54,658


7.


Auditor's remuneration

During the year, the Company obtained the following services from the Company's auditor:


2023
2022
£
£

Fees payable to the Company's auditor for the audit of the Company's financial statements

17,000
17,000
- 19 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

8.


Employees

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


2023
2022
£
£

Wages and salaries
5,248,118
6,816,455

Social security costs
635,344
790,522

Cost of defined contribution scheme
45,843
54,658

5,929,305
7,661,635


Amounts paid to temporary workers under contracts of services (Limited Companies) during the year ended 28 February 2023 amounted to £1,599,764 (2022: £1,927,914).
 

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


        2023
        2022
            No.
            No.







Employees of the Company (including Directors)
7
8



Temporary workers under contract of services (PAYE)
81
114



Temporary workers under contract of services (Limited Company)
16
10

104
132


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
71,014
50,000

Company contributions to defined contribution pension schemes
6,000
6,000

77,014
56,000


During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

- 20 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

10.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
48,457
86,600

Adjustments in respect of previous periods
2,570
(396)

Total current tax

51,027
86,204

Deferred tax


Origination and reversal of timing differences
(727)
-

Adjustment in respect of previous periods
(7,151)
-

Total deferred tax
(7,878)
-


Taxation on profit on ordinary activities
43,149
86,204

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 19% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
86,044
291,283


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
16,348
55,344

Effects of:


Fixed asset differences
31,347
31,331

Expenses not deductible for tax purposes
209
-

Adjustments to tax charge in respect of prior periods
2,570
(396)

Adjustments to tax charge in respect of prior periods - deferred tax
(7,151)
-

Remeasurement of deferred tax for changes in tax rates
(174)
(1,716)

Unrecognised deferred tax movement
-
1,641

Total tax charge for the year
43,149
86,204

- 21 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023
 
10.Taxation (continued)


Factors that may affect future tax charges

The UK Government announced in the 2021 budget that from 1 April 2023, the rate of corporation tax in the United Kingdom will increase from 19% to 25%. Companies with profits of £50,000 or less will continue to be taxed at 19%, which is a new small profits rate. Where taxable profits are between £50,000 and £250,000, the higher 25% rate will apply but with a marginal relief applying as profits increase.


11.


Dividends

2023
2022
£
£


Dividends paid
209,394
422,652


12.


Exceptional items

2023
2022
£
£


Exceptional items
45,172
-

The exceptional item relates to the net impact of a legal issue in the year.

- 22 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

13.


Intangible assets




Goodwill

£



Cost


At 1 March 2022
1,656,107



At 28 February 2023

1,656,107



Amortisation


At 1 March 2022
1,048,869


Charge for the year on owned assets
165,611



At 28 February 2023

1,214,480



Net book value



At 28 February 2023
441,627



At 28 February 2022
607,238

The goodwill has a remaining amortisation period of two year and eight months, becoming fully amortised in October 2025.



- 23 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

14.


Tangible fixed assets





Office equipment

£



Cost


At 1 March 2022
52,522


Additions
2,092



At 28 February 2023

54,614



Depreciation


At 1 March 2022
32,097


Charge for the year on owned assets
3,378



At 28 February 2023

35,475



Net book value



At 28 February 2023
19,139



At 28 February 2022
20,425


15.


Debtors

2023
2022
£
£


Trade debtors
475,992
562,221

Other debtors
28,517
304,357

Prepayments and accrued income
104,598
283,025

Deferred taxation
7,878
-

616,985
1,149,603


- 24 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

16.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
131,642
19,279

Less: bank overdrafts
(65,090)
(354,222)

66,552
(334,943)


Included within the bank overdraft balance is an invoice financing facility which at the year end amounted to £65,090 (2022: £354,222).


17.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank overdrafts
65,090
354,222

Trade creditors
43,549
8,068

Corporation tax
51,212
86,600

Other taxation and social security
182,146
291,765

Other creditors
99,355
166,816

Accruals and deferred income
121,755
76,289

563,107
983,760


The following liabilities were secured:

2023
2022
£
£



Bank overdrafts
65,090
354,222

Details of security provided:

The invoice financing facility is secured by way of fixed and floating charge over all property and undertaking of the Company dated 10 November 2015.
There exists a charge between the Company and J R Craven, L G Aston, P Aston, F J Craven and V McLeod dated 19 October 2015. This has a first fixed charge on all future property of the Company, all present and future rights, licenses, rents and deposits relating to the property, all present and future goodwill and all uncalled share capital. This has a first floating charged on all the undertakings, property, assets and rights of the Company not covered by the first fixed charge.
- 25 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

18.


Deferred taxation




2023


£






Charged to profit or loss
7,878



At end of year
7,878

The deferred tax asset is made up as follows:

2023
2022
£
£


Fixed asset timing differences
5,050
-

Short term timing differences
2,828
-

7,878
-


19.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022 - 100) Ordinary A shares of £1.00 each
100
100
100 (2022 - 100) Ordinary B shares of £1.00 each
100
100
15 (2022 - 15) Ordinary C shares of £1.00 each
15
15
15 (2022 - 15) Ordinary D shares of £1.00 each
15
15
10 (2022 - 10) Ordinary E shares of £1.00 each
10
10

240

240

Ordinary A shares and Ordinary B shares carry voting rights and the right to participate in capital distributions, including on winding up.
Ordinary C shares, Ordinary D shares and Ordinary E shares carry no voting rights and the right to participate in capital distributions, including on winding up.
All shares are not redeemable.



20.


Reserves

Profit & loss account

This reserve includes cumulative profits or losses less dividends declared.

- 26 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023
21.


Analysis of net debt




At 1 March 2022
Cash flows
At 28 February 2023
£

£

£

Cash at bank and in hand

19,279

112,363

131,642

Bank overdrafts

(354,222)

289,132

(65,090)

Debt due within 1 year

-

(53,728)

(53,728)


(334,943)
347,767
12,824


22.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company  in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £45,843 (2022: £54,658). Contributions totalling £5,738 (2022: £5,577) were payable to the fund at the reporting date and are included in creditors.


23.


Commitments under operating leases

At 28 February 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
40,397
3,927

Later than 1 year and not later than 5 years
48,019
-

88,416
3,927

- 27 -

 
ROYLE RECRUITMENT LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023

24.


Related party transactions

At the year end amounts due from the directors' to the Company totalled £12,477 (2022: £290,777) and amounts due to the directors' from the Company totalled £53,728 (2022: £nil). The directors’ loan accounts where these balances have arisen are active accounts with both payments and receipts as such balances are always repayable on demand. No interest is charged on outstanding balances. During the year there were times when the directors loan accounts were overdrawn. The maximum level of indebtedness of the directors to the Company in the year was £633,916.
At the year end £Nil (2022: £9,000) was owed to companies under common control. 
During the year there were dividends declared to directors totalling £209,394 (2022 - £422,652).
There are no key management personnel in addition to the directors and thus key management personnel compensation is included in the directors remuneration disclosures.


25.


Controlling party

The directors consider that there is no ultimate controlling party as the voting shares are held equally between J Craven and L Aston.
- 28 -