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Registered number: 00453843










PATERSON SIMONS & CO (AFRICA) LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
COMPANY INFORMATION


Directors
S A Baker 
J P Traynor 
H M J Lyne 
K O Okoh 
E R M Lyne 
J Savoy 




Registered number
00453843



Registered office
4 The Offices
10 Fleet Street

Brighton

East Sussex

BN1 4ZE




Trading Address
4 The Offices
10 Fleet Street

Brighton

East Sussex

BN1 4ZE






Independent auditors
Simmons Gainsford LLP
Chartered Accountants & Statutory Auditors

14th Floor

33 Cavendish Square

London

W1G 0PW





 
PATERSON SIMONS & CO (AFRICA) LIMITED
 

CONTENTS



Page
Group Strategic Report
1 - 3
Directors' Report
4 - 5
Independent Auditors' Report
6 - 9
Consolidated Statement of Comprehensive Income
10
Consolidated Balance Sheet
11 - 12
Company Balance Sheet
13
Consolidated Statement of Changes in Equity
14 - 15
Company Statement of Changes in Equity
16
Consolidated Statement of Cash Flows
17
Consolidated Analysis of Net Debt
18
Notes to the Financial Statements
19 - 41


 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

Introduction
 
The Directors of the Company present their strategic report together with the audited consolidated financial statements for the year ended 31 December 2022.
The principal activity of the Company and its subsidiaries continued to be that of agents and general merchants.
The Strategic Report is a statutory requirement under the Companies Act 2006.

Business review
 
The Directors consider that the main objectives of the business set in 2016 remain current, however as we have slowly taken on additional business in Cameroon and the Democratic Republic of Congo we have modified these to expand the territories in which we operate to include Central Africa.
Politically there were no main presidential elections in the region in 2022. The coup in Mali in 2021 resulting in sanctions was a cause of a tail off in mining activity which resumed in mid 2022 following African Union intervention and a lifting of sanctions.  The coup in Burkina Faso in 2022 along with the poor security situation has resulted in the suspension of operations of some of our mining customers.
Concerns over Al Qaida/Boko Haram disruption in the Sahel affecting Northern Nigeria, Northern Mali and North and Eastern Burkina Faso continue. The steps we took to look at contingency planning for travel activities during 2020 remain in place. 
The war in Ukraine also caused us to complete a due diligence exercise resulting in us ceasing supplies and work for one mining customer who was and remains subject to international sanctions.
The ADB forecasts that the economies of Sub Saharan Africa will grow by around 3.1% in 2023 down from an estimated 3.8% in 2022 however these figures mask some real difficulties in one of the main territories in which we trade - Ghana has had the worst performing currency in the world in 2022 and return to 3%  growth is not forecast until 2024. Port volumes during 2022 have reflected that background.
Elsewhere, sluggish growth in 2022 coupled with a presidential election in Nigeria in April 2023 is also likely to contribute to slow growth.
There are positive signs in the other areas: Mauritania, Mali and Liberia all have positive growth forecasts in part based on mining activities which we have benefited from. There are also positive signs for Togo and Benin as a result of planned diversification of their economies and this is evident in port development projects.
In the two main territories we operate in Central Africa, growth performance and forecasts for Cameroon and DRC are positive. Our exposure in both is limited to the main ports but significant investments in both countries port infrastructure support these forecasts. 
Our strategy to continue to offer quality service, parts, retrofits/upgrades and aged replacements in the port sector is well established. PSAL continues to enjoy the trust of all the main terminal operators in the region who generate the majority of our income and in many areas relationships are deepening.
The planned merger of Konecranes and Cargotec (Kalmar) announced in 2021 fell through which has significantly removed some uncertainty around the direction of our port service business. The renewed stability of relations with Konecranes has allowed us to review existing plans and agreements and to look document and secure those plans with firmer formal agreements going forwards.
 
Page 1

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

Gold remains the main commodity of interest to us. The market price has traded at a range of USD1700 to USD 2000 per oz during 2022 and at that range the metal price remains strong enough to see continued investment, particularly for the large scale miners. Sales of telehandlers and mobile cranes have been strong with that background.
The oil price been hovering around the USD 70- 80/barrel mark for most of 2022. There are some small signs that the relative stability of the price may support fresh exploration activity in the relatively expensive waters of the Gulf of Guinea but onshore activity to support this remains low. 
Many other commodities have seen pricing rally. The opaque Bauxite and Manganese markets may be under some revival: Ghana Manganese stabilised its production during 2022. Guinea has seen continued investment in development of its bauxite reserves. Lithium has seen the development of one mine to production in Mali with various others in the region undergoing feasibility studies. This is commodity we will need to monitor closely in the coming years.  
Cocoa prices remain volatile, in part as a result of the Ghana/Ivory Coast “Abidjan Agreement” where large international cocoa buyers sought to circumvent purchasing from the Worlds’ two largest cocoa producers but also as a result of poor crop yields. Interest in mechanisation of bulk export remains alongside the trend to add value to the product by processing locally.
The after-effects of the coronavirus pandemic coupled with the war in Ukraine and post Brexit labour challenges have impacted our operations significantly. Working patterns have settled down, service labour remains in demand and travel has returned to normal but supply chain difficulties caused by the pandemic remain and these have been exacerbated by the war in Ukraine which as a territory was a key supplier of special steel grades and electrical components to the lifting equipment industry. Both new equipment and spare parts deliveries been repeatedly extended and are unpredictable. This disruption has been accompanied by significant price inflation. PSAL Group continues to work closely with suppliers and to recruit, train, develop and invest in people and systems to mitigate the effects of this disruption which are a major cause of customer dissatisfaction.
Some of the challenges thrown up by the current market have caused us to delay implementation of our Microsoft Dynamics based CRM which is now forecast to be delivered in late 2023.  This timing will enable us to roll this out as part of a new dedicated approach to Key Account Management.
During 2022 we appointed a dedicated HSE manager to update and accredit our HSE system. Steady progress has been made during the year and we expect to have an accredited ISO45001 system in the course of 2023. HSE fits into the wider area of sustainability which is a topic the Directors have long taken seriously and it is a key component to being a trusted partner for many of our customers. The Directors of the business are close to the day to day operations of the business which mitigates a lot of risk but work is ongoing to assess those and to introduce formal policies and document procedures to mitigate them.

Financial key performance indicators
 
The group turnover increased by 3.7% on the previous year (2021 - increase of 25.5%). The commissions element of the total turnover decreased by 51% on the previous year whilst that for the sale of goods increased by 7.8%. This had an effect on the Gross profit as commissions generate higher margins than the sale of goods. The Group achieved a Gross profit of 27.6% in 2022 (29.1% - 2021).
The Group has maintained its investment in staff with a small decrease in staff numbers from 235 in 2021 to 232 at the end of 2022, across the Group. The overall staffing costs for 2022 totalled £3.719 Million (2021 - £3.227 Million). Salaries were increased during the year 2022 to keep in line with local inflation rises and the increasing cost of living in the West African regions in which the Group operates. 
The interest rates across West Africa continued to increase year on year. Added to some significant increases in West African rates of inflation this has given rise to high increases in overheads and administration costs. 
 
Page 2

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022


There are decreased amounts owed to the parent company by the subsidiaries, however these balances are still substantial and hence exposes the group to more risk of foreign exchange losses. 
2022 has seen an increase to the Foreign Exchange Provision of £478,584 (2021 - £126,362 increase) arising due to the significant decline in the Cedi (Ghana) and Niara (Nigeria) from the start to the end of the current year. This figure has been adjusted in the Comprehensive Income account. 
The resultant loss before tax for the year was £447,753 (2021 - profit of £317,302).
2022 Exceptional Items 
The operating result for the group during the year to 31st December 2022 was significantly affected by a bad debt provision for €200,000 of debt due from one of the major customers. There was then a one off contract termination payment made in March 2022 of £250,000 to the management company whose services where no longer required. 

Financial instruments
 
The Group's financial instruments principally comprise of trade debtors, cash at bank, trade creditors and bank loan facilities, the main purpose of which is to finance the Group's operations. In addition, the Group has various other financial assets and liabilities such as other creditors arising directly from operations. It is, and has been throughout the period under review, the Group's policy that no trading in financial instruments shall be undertaken.
The main risks arising from the Group's financial instruments are liquidity, credit and foreign exchange risk. The Board reviews and agrees policies for managing each of these risks and they are summarised below. These policies have remained unchanged throughout the period.
Liquidity risk
The Group is susceptible to liquidity risk on large plant deals. Management prepare and review weekly cashflow forecasts to ensure sufficient funds are held for commitments. Short term shareholder loans are available to the group to inject cash when required.
Credit risk
All debtors are subject to credit verification procedures by the Board. Debtors are reviewed on a regular basis and provision is made for doubtful debts when necessary.
Foreign exchange risk
The Group is exposed to exchange rate fluctuations particularly where goods are invoiced in foreign currency. This is largely managed through a natural hedge generated from purchases denominated in the same currency.


This report was approved by the board on 29 September 2023 and signed on its behalf.




J P Traynor
Director

Page 3

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

The directors present their report and the financial statements for the year ended 31 December 2022.

Directors' responsibilities statement

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

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


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

make judgments and accounting estimates that are reasonable and prudent;

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The loss for the year, after taxation and minority interests, amounted to £381,353 (2021 - profit £171,044).

The directors do not propose the payment of a dividend.
The directors have highlighted in the strategic report on pages 1-3, a review of the current year results, future outlook expectations, risks and key performance indicators for the Group.

Directors

The directors who served during the year were:

S A Baker 
J P Traynor 
H M J Lyne 
K O Okoh 
E R M Lyne 
J Savoy 

Page 4

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

Disclosure of information to auditors

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

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

Post balance sheet events

There have been no significant events affecting the Group since the year end.

Auditors

The auditorsSimmons Gainsford LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 29 September 2023 and signed on its behalf.
 





J P Traynor
Director

Page 5

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PATERSON SIMONS & CO (AFRICA) LIMITED
 

Opinion


We have audited the financial statements of Paterson Simons & Co (Africa) Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2022, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 December 2022 and of the Group's loss 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Page 6

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PATERSON SIMONS & CO (AFRICA) LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and  our Auditors' Report thereon.  The directors are responsible for the other information contained within the Annual Report.  Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated.  If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves.  If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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


Matters on which we are required to report by exception
 

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


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 4, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the directors are responsible for assessing the Group's and the parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.

Page 7

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PATERSON SIMONS & CO (AFRICA) LIMITED (CONTINUED)



Auditors' 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 Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Group financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

In order to identify and assess the risks of material misstatements, including fraud and non-compliance with laws and regulations that could be expected to have a material impact on the financial statements, we have considered:
• the results of our enquiries of management and those charged with governance of their assessment of    the risks of fraud and irregularities;
• the nature of the Group, including its management structure and control systems (including the     opportunity for management to override such controls);
• management’s incentives and opportunities for fraudulent manipulation of the financial statements    including the Company’s remuneration and bonus policies and performance targets; and 
• the industry and environment in which it operates.
We also considered tax and pension legislation and laws and regulations relating to employment and the preparation and presentation of the financial statements such as the Companies Act 2006.
Based on this understanding we identified the following matters as being of significance to the entity:
• laws and regulations considered to have a direct effect on the financial statements including UK financial   reporting standards, Company Law, tax and pension legislation and distributable profits legislation;
• the timing of the recognition of commercial income;
• compliance with legislation relating to health and safety and operating licenses;
• management bias in selecting accounting policies and determining estimates;
• inappropriate journal entries;and
• recoverability of debtors.
We communicated the outcomes of these discussions and enquiries, as well as consideration as to where and how fraud may occur in the entity, to all engagement team members including the auditors of significant components.
Audit procedures undertaken by the Group engagement team and/or component auditors in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised:
• enquiries of management and those charged with governance as to whether the entity complies with such   laws and regulations and discussion with the same regarding any known or suspected instances of non-   compliance
• enquiries with the same concerning any actual or potential litigation or claims;
• inspection of relevant legal correspondence;
• assessment of matters reported to management and the result of the subsequent investigation;
 
Page 8

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PATERSON SIMONS & CO (AFRICA) LIMITED (CONTINUED)


• obtaining an understanding of the relevant controls during the period and consideration of their     implementation
• obtaining an understanding of the policies and controls over the recognition of income and testing their    implementation during the year;
• challenging assumptions made by management in their specific accounting policies and estimates, in    particular in relation to depreciation of tangible fixed assets and impairment of investments;
• identifying and testing journal entries, in particular any journal entries posted with unusual account    combinations or crediting revenue or cash;
• assessing the recovery of debtors in the period since the balance sheet date and challenging     assumptions made by management regarding the recovery of balances which remain outstanding;
• reviewing the financial statements for compliance with the relevant disclosure requirements; 
• performing analytical procedures to identify any unusual or unexpected relationships or unexpected    movements in account balances which may be indicative of fraud;
• reviewing correspondence with HMRC;
• evaluating the underlying business reasons for any unusual transactions; and
• review of component auditors' working papers.
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


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 Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





David Pumfrey FCA (Senior Statutory Auditor)
for and on behalf of
Simmons Gainsford LLP
Chartered Accountants
Statutory Auditors
14th Floor
33 Cavendish Square
London
W1G 0PW

29 September 2023
Page 9

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022

As restated
2022
2021
Note
£
£

  

Turnover
 4 
20,951,919
20,198,984

Cost of sales
  
(15,172,853)
(14,328,555)

Gross profit
  
5,779,066
5,870,429

Administrative expenses
  
(6,431,594)
(5,416,476)

Other operating income
 5 
324,167
(58,373)

Operating (loss)/profit
 6 
(328,361)
395,580

Interest payable and similar expenses
 10 
(119,392)
(78,278)

(Loss)/profit before taxation
  
(447,753)
317,302

Tax on (loss)/profit
 11 
123,677
(152,101)

(Loss)/profit for the financial year
  
(324,076)
165,201

  

Unrealised deficit on revaluation of leasehold property held for sale
  
-
(1,112,554)

Deferred tax on unrealised deficit of leasehold property
  
-
428,001

Foreign exchange movement
  
(478,584)
(126,362)

Other comprehensive income for the year
  
(478,584)
(810,915)

Total comprehensive income for the year
  
(802,660)
(645,714)

(Loss)/profit for the year attributable to:
  

Non-controlling interests
  
57,277
(5,843)

Owners of the parent Company
  
(381,353)
171,044

  
(324,076)
165,201

Total comprehensive income for the year attributable to:
  

Non-controlling interest
  
(72,265)
(212,572)

Owners of the parent Company
  
(730,395)
(433,142)

  
(802,660)
(645,714)

The notes on pages 19 to 41 form part of these financial statements.

Page 10

 
PATERSON SIMONS & CO (AFRICA) LIMITED
REGISTERED NUMBER: 00453843

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2022

As restated
2022
2021
Note
£
£

Fixed assets
  

Tangible assets
 14 
824,223
894,404

  
824,223
894,404

Current assets
  

Fixed assets held for sale
  
-
1,266,805

Stocks
 17 
418,271
529,124

Debtors: amounts falling due within one year
 18 
8,123,358
7,757,273

Cash at bank and in hand
 19 
1,340,700
990,487

  
9,882,329
10,543,689

Creditors: amounts falling due within one year
 20 
(6,878,613)
(6,534,005)

Net current assets
  
 
 
3,003,716
 
 
4,009,684

Total assets less current liabilities
  
3,827,939
4,904,088

Creditors: amounts falling due after more than one year
 21 
-
(49,996)

Provisions for liabilities
  

Deferred taxation
 23 
(5,156)
(228,649)

  
 
 
(5,156)
 
 
(228,649)

Net assets
  
3,822,783
4,625,443

Page 11

 
PATERSON SIMONS & CO (AFRICA) LIMITED
REGISTERED NUMBER: 00453843
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022

As restated
2022
2021
Note
£
£

Capital and reserves
  

Called up share capital 
 24 
450,000
450,000

Revaluation reserve
 25 
218,351
1,117,189

Foreign exchange reserve
 25 
(1,202,592)
(853,550)

Profit and loss account
 25 
4,061,786
3,544,301

Equity attributable to owners of the parent Company
  
3,527,545
4,257,940

Non-controlling interests
  
295,238
367,503

  
3,822,783
4,625,443


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 29 September 2023.




J P Traynor
Director

The notes on pages 19 to 41 form part of these financial statements.

Page 12

 
PATERSON SIMONS & CO (AFRICA) LIMITED
REGISTERED NUMBER: 00453843

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2022

As restated
2022
2021
Note
£
£

Fixed assets
  

Tangible assets
 14 
475,433
475,433

Investments
 16 
987,226
978,170

  
1,462,659
1,453,603

Current assets
  

Stocks
 17 
75,359
77,918

Debtors: amounts falling due within one year
 18 
6,566,913
6,436,963

Cash at bank and in hand
 19 
551,334
398,759

  
7,193,606
6,913,640

Creditors: amounts falling due within one year
 20 
(5,371,265)
(4,662,310)

Net current assets
  
 
 
1,822,341
 
 
2,251,330

Total assets less current liabilities
  
3,285,000
3,704,933

  

Creditors: amounts falling due after more than one year
 21 
-
(49,996)

  

Net assets
  
3,285,000
3,654,937


Capital and reserves
  

Called up share capital 
 24 
450,000
450,000

Revaluation reserve
 25 
992,735
992,735

Profit and loss account
 25 
1,842,265
2,212,202

  
3,285,000
3,654,937


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 29 September 2023.


J P Traynor
Director

The notes on pages 19 to 41 form part of these financial statements.

Page 13

 

 
PATERSON SIMONS & CO (AFRICA) LIMITED


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022



Called up share capital
Revaluation reserve
Foreign exchange reserve
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity


£
£
£
£
£
£
£


At 1 January 2022 (as previously stated)
450,000
898,838
(853,550)
3,544,301
4,039,589
367,503
4,407,092


Prior year adjustment - change in accounting policy
-
218,351
-
-
218,351
-
218,351


At 1 January 2022 (as restated)
450,000
1,117,189
(853,550)
3,544,301
4,257,940
367,503
4,625,443



Comprehensive income for the year


Loss for the year

-
-
-
(381,353)
(381,353)
57,277
(324,076)


Foreign exchange movement
-
-
(349,042)
-
(349,042)
(129,542)
(478,584)



Other comprehensive income for the year
-
-
(349,042)
-
(349,042)
(129,542)
(478,584)



Total comprehensive income for the year
-
-
(349,042)
(381,353)
(730,395)
(72,265)
(802,660)


Realised gain on sale of leasehold property
-
(898,838)
-
898,838
-
-
-



At 31 December 2022
450,000
218,351
(1,202,592)
4,061,786
3,527,545
295,238
3,822,783



The notes on pages 19 to 41 form part of these financial statements.

Page 14

 

 
PATERSON SIMONS & CO (AFRICA) LIMITED


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021



Called up share capital
Revaluation reserve
Foreign exchange reserve
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity


£
£
£
£
£
£
£


At 1 January 2021 (as previously stated)
450,000
3,757,303
(1,612,806)
2,701,191
5,295,688
881,376
6,177,064


Prior year adjustment - correction of error
-
-
(822,957)
-
(822,957)
(301,301)
(1,124,258)


Prior year adjustment - change in accounting policy
-
218,351
-
-
218,351
-
218,351


At 1 January 2021 (as restated)
450,000
3,975,654
(2,435,763)
2,701,191
4,691,082
580,075
5,271,157



Comprehensive income for the year


Profit for the year

-
-
-
171,044
171,044
(5,843)
165,201


Deficit on revaluation of leasehold property
-
(2,499,695)
1,685,303
-
(814,392)
(298,162)
(1,112,554)


Deficit on revaluation and reversal of forex on leasehold property
held for sale
-
(358,770)
-
672,066
313,296
114,705
428,001


Foreign exchange movement
-
-
(103,090)
-
(103,090)
(23,272)
(126,362)



Other comprehensive income for the year
-
(2,858,465)
1,582,213
672,066
(604,186)
(206,729)
(810,915)



Total comprehensive income for the year
-
(2,858,465)
1,582,213
843,110
(433,142)
(212,572)
(645,714)



At 31 December 2021
450,000
1,117,189
(853,550)
3,544,301
4,257,940
367,503
4,625,443



The notes on pages 19 to 41 form part of these financial statements.

Page 15

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022


Called up share capital
Revaluation reserve
Profit and loss account
Total equity

£
£
£
£

At 1 January 2022 (as previously stated)
450,000
774,384
2,212,202
3,436,586

Prior year adjustment - change in accounting policy
-
218,351
-
218,351

At 1 January 2022 (as restated)
450,000
992,735
2,212,202
3,654,937


Comprehensive income for the year

Loss for the year
-
-
(369,937)
(369,937)


At 31 December 2022
450,000
992,735
1,842,265
3,285,000


The notes on pages 19 to 41 form part of these financial statements.


COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021


Called up share capital
Revaluation reserve
Profit and loss account
Total equity

£
£
£
£

At 1 January 2021 (as previously stated)
450,000
1,600,082
2,058,958
4,109,040

Prior year adjustment - change in accounting policy
-
218,351
-
218,351

At 1 January 2021 (as restated)
450,000
1,818,433
2,058,958
4,327,391


Comprehensive income for the year

Profit for the year
-
-
153,244
153,244

Deficit on revaluation of investment in subsidiary
-
(825,698)
-
(825,698)


At 31 December 2021
450,000
992,735
2,212,202
3,654,937


The notes on pages 19 to 41 form part of these financial statements.

Page 16

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022

2022
2021
£
£

Cash flows from operating activities

(Loss)/profit for the financial year
(324,076)
165,201

Adjustments for:

Depreciation of tangible assets
138,702
94,865

Loss on disposal of tangible assets
(316,259)
60,772

Interest paid
119,392
78,278

Taxation charge
(123,677)
152,101

Decrease/(increase) in stocks
110,853
(52,852)

(Increase) in debtors
(366,085)
(1,375,353)

Increase in creditors
905,180
590,865

(Decrease) in provisions
(26,668)
(58,684)

Corporation tax (paid)
(194,229)
(112,181)

Foreign exchange
(379,192)
(58,429)

Net cash generated from operating activities

(456,059)
(515,417)


Cash flows from investing activities

Purchase of tangible fixed assets
(167,912)
(338,609)

Sale of tangible fixed assets
1,583,064
174,504

Net cash from investing activities

1,415,152
(164,105)

Cash flows from financing activities

Other new loans
-
(50,000)

Repayment of other loans
(100,008)
-

Interest paid
(119,392)
(78,278)

Net cash used in financing activities
(219,400)
(128,278)

Net increase/(decrease) in cash and cash equivalents
739,693
(807,800)

Cash and cash equivalents at beginning of year
595,106
1,402,906

Cash and cash equivalents at the end of year
1,334,799
595,106


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,340,700
990,487

Bank overdrafts
(5,901)
(395,381)

1,334,799
595,106


The notes on pages 19 to 41 form part of these financial statements.

Page 17

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2022





At 1 January 2022
Cash flows
Other non-cash changes
At 31 December 2022
£

£

£

£

Cash at bank and in hand

990,487

350,213

-

1,340,700

Bank overdrafts

(395,381)

389,480

-

(5,901)

Debt due after 1 year

(49,996)

-

49,996

-

Debt due within 1 year

(100,000)

100,000

(49,988)

(49,988)


445,110
839,693
8
1,284,811

The notes on pages 19 to 41 form part of these financial statements.

Page 18

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

1.


General information

The Company is a private company limited by shares, and is incorporated in England & Wales. The address of its registered office is 4 The Offices, 10 Fleet Street, Brighton, East Sussex, BN1 4ZE, which is also the Company's principal trading address.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).

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

Parent Company disclosure exemptions
In preparing the separate financial statements of the parent Company, advantage has been taken of the following disclosure exemptions available in FRS 102:
 No Statement of Cash Flows has been presented for the parent Company;
 Disclosures in respect of the parent Company's financial instruments have not been presented as    equivalent disclosures have been provided in respect of the Group as a whole; and
 No disclosures have been given for the aggregate remuneration of the key management personnel   of the parent Company as their remuneration is included in the totals for the Group as a whole.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

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

Page 19

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.3

Revenue

Sale of goods and rendering of services
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Turnover from the sale of goods is recognised when the goods are made available at the designated location and the customer has been notified. 
Turnover on maintenance contracts is recognised in proportion to the length of the contract with full provision made for all foreseeable costs. 

 
2.4

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer's interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Acquired goodwill is written off to profit or loss in the year in which it is acquired.
Computer software
Software acquired by the company is stated at cost less accumulated amortisation and impairment losses.  Subsequent expenditure on software assets is capitalised only when it increases future economic benefits embodied in the specific assets to which it relates.  All other expenditure is expensed as incurred.  Amortisation is recognised in the profit and loss on a straight line basis over the estimated useful life of the software from the date that it is available for use.  The estimated useful life of the software is 3 years.

 
2.5

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.

Page 20

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)


2.5
Tangible fixed assets (continued)

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

Depreciation is provided on the following basis:

Plant and machinery
-
20% straight line
Motor vehicles
-
25% straight line
Fixtures and fittings
-
33% straight line

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

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

 
2.6

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

  
2.7

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each balance sheet date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit (CGU) to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each balance sheet date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.8

Valuation of investments

Investments in subsidiaries are measured at deemed cost less accumulated impairment. On transition to FRS 102 in 2016, the investments which were held at valuation were recognised at deemed cost and the revaluation frozen as per the rules at the time.

Page 21

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.9

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.10

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

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

 
2.11

Financial instruments

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

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

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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

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

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Group after the deduction of all its liabilities.
 
Page 22

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)


2.11
Financial instruments (continued)


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

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

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

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.


Page 23

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.12

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

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

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

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Consolidated Statement of Comprehensive Income except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Consolidated Statement of Comprehensive Income within 'other operating income'.
On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.

 
2.13

Finance costs

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

 
2.14

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.

Page 24

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.15

Operating leases: the Group as lessee

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

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

 
2.16

Pensions

Defined contribution pension plan

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

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

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in the Consolidated Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

Page 25

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.17

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Balance Sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The company makes estimates and assumptions concerning the future. Actual results may differ from these estimates. 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.

Page 26

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

4.


Turnover

Analysis of turnover by country of destination:

2022
2021
        £
        £

Europe

285,026

588,278

Africa

20,666,893

19,617,528


20,951,919

20,205,806


An analysis of turnover by class of business is as follows:


2022
2021
£
£



Sale of goods
17,153,308
15,915,332

Services rendered
3,513,585
3,702,196

Commissions receivable
285,026
588,278

20,951,919
20,205,806


5.


Other operating income

2022
2021
£
£

Other operating income/(expense)
324,167
(58,373)


This comprises sundry income of £7,909 (2021: £2,399)  and profit on sale on assets of £316,259 (2021: Loss on sale of assets of £60,772) held in subsidiaries.


6.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

2022
2021
£
£

Exchange differences
62,556
390,852

Other operating lease rentals
208,961
209,992

Page 27

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

7.


Auditors' remuneration

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


2022
2021
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements

45,500
40,980


8.


Employees

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


Group
Group
Company
Company
2022
2021
2022
2021
£
£
£
£


Wages and salaries
3,388,690
2,950,266
1,832,135
1,634,121

Social security costs
132,818
116,911
112,021
93,512

Cost of defined contribution scheme
197,807
160,285
29,303
26,776

3,719,315
3,227,462
1,973,459
1,754,409


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



Group
Group
Company
Company
        2022
        2021
        2022
        2021
            No.
            No.
            No.
            No.









Finance and IT
10
10
5
5



Logistics and Shipping
8
10
3
5



Office and Administrative
34
38
1
3



Production and Engineering
166
162
7
7



Sales
14
15
7
8

232
235
23
28

Page 28

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

9.


Directors' remuneration

2022
2021
£
£

Directors' emoluments
588,920
514,690

Group contributions to defined contribution pension schemes
11,792
9,505

600,712
524,195


During the year retirement benefits were accruing to 4 directors (2021 - 3) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £155,834 (2021 - £157,273).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £NIL (2021 - £NIL).


10.


Interest payable and similar expenses

2022
2021
£
£


Bank interest payable
119,392
78,278

Page 29

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

11.


Taxation


2022
2021
£
£


Foreign tax


Foreign tax on income for the year
99,816
152,101

Deferred tax


Origination and reversal of timing differences
(223,493)
-


Taxation on (loss)/profit on ordinary activities
(123,677)
152,101

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2021 - higher than) the standard rate of corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:

2022
2021
£
£


(Loss)/profit on ordinary activities before tax
(447,753)
317,302


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021 - 19%)
(85,073)
60,287

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
13,316
5,054

Capital allowances for year in excess of depreciation
(1,167)
(4,526)

Impact of different rates of corporation tax in foreign jurisdictions
79,772
87,315

Unrelieved tax losses carried forward
91,870
3,971

Deferred tax movement relating to property disposed of in the year
(222,395)
-

Total tax charge for the year
(123,677)
152,101


Factors that may affect future tax charges

There were no factors that may affect future tax charges.




12.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements. The loss after tax of the parent Company for the year was £369,937 (2021 - profit £153,244).

Page 30

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

13.


Intangible assets

Group





Computer software
Goodwill
Total

£
£
£



Cost


At 1 January 2022
37,680
348,095
385,775



At 31 December 2022

37,680
348,095
385,775



Amortisation


At 1 January 2022
37,680
348,095
385,775



At 31 December 2022

37,680
348,095
385,775



Net book value



At 31 December 2022
-
-
-



At 31 December 2021
-
-
-



Page 31

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

14.


Tangible fixed assets

Group






Long-term leasehold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Total

£
£
£
£
£



Cost or valuation


At 1 January 2022
485,638
297,058
699,166
234,216
1,716,078


Additions
-
94,562
44,266
29,084
167,912


Disposals
-
-
(9,936)
-
(9,936)


Exchange adjustments
(2,062)
(26,866)
(53,523)
(16,940)
(99,391)



At 31 December 2022

483,576
364,754
679,973
246,360
1,774,663



Depreciation


At 1 January 2022
2,503
207,477
454,238
157,456
821,674


Charge for the year on owned assets
553
52,568
55,198
30,383
138,702


Disposals
-
-
(9,936)
-
(9,936)



At 31 December 2022

3,056
260,045
499,500
187,839
950,440



Net book value



At 31 December 2022
480,520
104,709
180,473
58,521
824,223



At 31 December 2021
483,135
89,581
244,928
76,760
894,404

Page 32

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Revalued Assets
The leasehold property in Ghana was revalued at the previous year end by the Directors, based on the sales price of the property after the year end; this was subsequently reclassified to Non-current assets held for sale.
The leasehold property in the UK was revalued at the year end by a professional valuer. 

If the land and buildings had not been included at valuation they would have been included under the historical cost convention as follows:

2022
2021
£
£

Group


Cost
278,581
459,725

Accumulated depreciation
-
(41,826)

Net book value
278,581
417,899


Company






Long-term leasehold property
Fixtures and fittings
Total

£
£
£

Cost or valuation


At 1 January 2022
475,000
3,563
478,563



At 31 December 2022

475,000
3,563
478,563



Depreciation


At 1 January 2022
-
3,130
3,130



At 31 December 2022

-
3,130
3,130



Net book value



At 31 December 2022
475,000
433
475,433



At 31 December 2021
475,000
433
475,433

The directors do not consider that the carrying value of the properties is materially different to their fair value.






Page 33

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022




15.


Non-current assets held for sale

2022
2021
£
£
Assets and liabilities



Non-current assets held for sale


Fixed assets held for sale

-
1,266,805

Equity


Revaluation reserve

-
(1,112,554)

In August 2021, management committed to a plan to sell the remainder of the Ghana leasehold property. Accordingly, the property was revalued to the sales price achieved after the year end and is presented as non-current assets held for sale in the prior year. The sale of the property was completed in August 2022.
There is a decrease in the asset's carrying amount by £Nil (2021: £1,112,554) as a result of a revaluation, based on fair value determined by the sales price. This was accounted for in Other comprehensive income.

Page 34

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

16.


Fixed asset investments

Company





Investments in subsidiary companies

£



Deemed cost


At 1 January 2022
978,170


Additions
9,056



At 31 December 2022
987,226





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Pasico Ghana Limited
Lagoon House, Guggisberg Avenue, Korle-Lagoon
P. O. Box GP 480
Accra , Ghana
Ordinary
73.2%
Paterson Simons & Company Nigeria Limited
34 Wharf Road, Apapa, Lagos. Nigeria
Ordinary
99%
Certification, Inspection & Training Ghana Limited
Lagoon House, Guggisberg Avenue, Korle-Lagoon
P. O. Box GP 480
Accra, Ghana
Ordinary
81%
Paterson Simons & Co Togo SARL U
2564 Ave De La Chance, 2eme Etage IMB, Sazof, Togo
Ordinary
100%
Paterson Simons & Co. Cameroun
Bonapriso, 501 Avenue Des Palmiers, B P 5669, Doula, Cameroon
Ordinary
100%

Page 35

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

17.


Stocks

Group
Group
Company
Company
2022
2021
2022
2021
£
£
£
£

Raw materials and consumables
342,912
441,636
-
-

Finished goods and goods for resale
75,359
87,488
75,359
77,918

418,271
529,124
75,359
77,918


The difference between purchase price or production cost of stocks and their replacement cost is not material.


18.


Debtors

Group
Group
Company
Company
2022
2021
2022
2021
£
£
£
£


Trade debtors
6,647,361
6,227,149
5,609,519
5,218,807

Amounts owed by group undertakings
-
-
731,955
1,001,478

Other debtors
922,481
1,100,650
28,508
71,754

Prepayments and accrued income
553,516
429,474
196,931
144,924

8,123,358
7,757,273
6,566,913
6,436,963



19.


Cash and cash equivalents

Group
Group
Company
Company
2022
2021
2022
2021
£
£
£
£

Cash at bank and in hand
1,340,700
990,487
551,334
398,759

Less: bank overdrafts
(5,901)
(395,381)
(24)
-

1,334,799
595,106
551,310
398,759


Page 36

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

20.


Creditors: Amounts falling due within one year

Group

Group 
 
Company

Company
 
2022
2021
2022
2021
£
£
£
£

Bank overdrafts
5,901
395,381
24
-

Trade creditors
5,525,238
4,668,501
5,085,964
4,236,087

Amounts owed to group undertakings
-
-
13,969
169,326

Corporation tax
222,496
316,909
-
-

Other creditors
1,052,961
1,066,469
227,158
223,307

Accruals and deferred income
72,017
86,745
44,150
33,590

6,878,613
6,534,005
5,371,265
4,662,310


Group
The bank loan and overdraft facilities provided to the subsidiary in Ghana are secured by way of a mortgage claim, non property debenture covering stock, debtors and vehicles; and specific charges over the plant and machinery of that company. The total bank loans and overdrafts secured is £5,901 (2021 - £395,381).
Included within other creditors at the year end is a loan of £49,988 (2021 - £149,996) due to a director. The amount due after more than one year is Nil (2021 - £49,996).
The amount is repayable in 24 equal monthly installments from July 2021. The loan is interest free and unsecured.


21.


Creditors: Amounts falling due after more than one year

Group
Group
Company
Company
2022
2021
2022
2021
£
£
£
£

Other loans
-
49,996
-
49,996




Page 37

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

22.


Loans


Analysis of the maturity of loans is given below:


Group
Group
Company
Company
2022
2021
2022
2021
£
£
£
£


Amounts falling due 1-2 years

Other loans
-
49,996
-
49,996




23.


Deferred taxation


Group



2022
2021


£

£




Group


At beginning of year (As restated)
228,649
672,066


Charged to profit or loss
(223,493)
-


Charged to other comprehensive income
-
(428,001)


Foreign exchange adjustment
-
(15,416)



At end of year
5,156
228,649

Group

Group
As restated
2022
2021
£
£

Accelerated capital allowances
5,156
6,254

Revaluation of property
-
222,395

5,156
228,649

Page 38

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

24.


Share capital

2022
2021
£
£
Allotted, called up and fully paid



400,000 (2021 - 400,000) Ordinary A shares of £1.00 each
400,000
400,000
50,000 (2021 - 50,000) Ordinary B shares of £1.00 each
50,000
50,000

450,000

450,000

There are two classes of Ordinary shares. 
Voting rights -
Both classes of shares have equal voting rights.
Dividends -
Ordinary A shares are entitled pari passu with each other to dividend payments. Ordinary B shares are entitled pari passu with each other to dividend payments. Differing dividends can be paid as against different classes of shares as determined by the board. 
On a sale -
The Ordinary A shares have preference over the Ordinary B shares in a sale of all or a substantial part of the company where the buyer acquires a controlling interest in the company.



25.


Reserves

Revaluation reserve

Group
The revaluation reserve comprises movements in the revaluations of leasehold properties net of the associated deferred tax.
Company
The revaluation reserve comprises movements in the revaluations of Investment in subsidiaries and the leasehold property.

Foreign exchange reserve

The foreign exchange reserve comprises foreign exchange movements on the retranslation of overseas subsidiaries.

Profit and loss account

The profit and loss account does not contain any non-distributable reserves in the current or prior periods.

Page 39

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

26.


Prior year adjustment

During the year there was a change in accounting policy to carry the leasehold property under the revaluation model. 
A prior year adjustment was made to ensure the comparatives reflect this change, as follows: 
The leasehold property value and revaluation reserve at 1 January 2021 has been increased by £218,351.
In the opinion of the directors, the valuation of the property has not changed since the adjustment made as at 1 January 2021.
During the prior year the directors identified that the foreign exchange movements on the leasehold property held in Ghana were incorrectly reflected in the accounts. This was corrected by a prior year adjustment.
This resulted in the decrease of the revaluation reserves at 1 January 2020 of £949,552 and an increase in the charge to the Other comprehensive income of £174,706 resulting in a reduction in the reserves.


27.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £197,807 (2021 - £160,285). 


28.


Commitments under operating leases

At 31 December 2022 the Group had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2022
2021
£
£

Not later than 1 year
34,740
16,690

34,740
16,690
Page 40

 
PATERSON SIMONS & CO (AFRICA) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

29.


Related party transactions

Group and Company
During the year, a company under common control, charged management fees of £337,867 (2021 - £289,328) to the company.
The total compensation paid to key management personnel including the directors during the year was £1,050,982 (2021 - £1,005,268).
Company
During the year, the company charged management fees of £Nil (2021 - £74,760) to a subsidiary undertaking.
During the year, the company made sales of £347,237 (2021 - £707,535) to subsidiary undertakings.
During the year, the company made purchases of £162,169 (2021 - £32,355) from subsidiary undertakings.
The following balances are due from/(due to) subsidiary companies not wholly owned and participating interests at the balance sheet date:

2022
2021
        £
        £
Pasico Ghana Limited

217,764

387,576
 
Certification Inspection and Training Ghana Limited

3,912

3,912
 
Paterson Simons & Company Nigeria Limited

450,723

368,185
 

672,399

759,673
 


30.


Controlling party

The Group considers H M J Lyne, a director of the company, to be the ultimate controlling party by virtue of his shareholding in the company in the current year.

 
Page 41