Company Registration No. 03823788 (England and Wales)
ERGRO TECHNICAL SERVICES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
PAGES FOR FILING WITH REGISTRAR
LB GROUP
1 Vicarage Lane
Stratford
London
E15 4HF
ERGRO TECHNICAL SERVICES LIMITED
COMPANY INFORMATION
Directors
Mr C M Wollen
Mr P B Martin
Mr P Cole
Mr G J Woodley
Company number
03823788
Registered office
1 Vicarage Lane
Stratford
London
England
E15 4HF
Auditor
LB Group (Stratford)
1 Vicarage Lane
Stratford
London
E15 4HF
ERGRO TECHNICAL SERVICES LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 8
ERGRO TECHNICAL SERVICES LIMITED
BALANCE SHEET
AS AT
30 APRIL 2023
30 April 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
5
199,015
246,227
Current assets
Stocks
9,628
9,628
Debtors
6
1,975,105
2,165,290
Cash at bank and in hand
121,384
117,453
2,106,117
2,292,371
Creditors: amounts falling due within one year
7
(1,755,163)
(1,797,524)
Net current assets
350,954
494,847
Total assets less current liabilities
549,969
741,074
Creditors: amounts falling due after more than one year
8
(199,631)
(422,325)
Net assets
350,338
318,749
Capital and reserves
Called up share capital
9
2
2
Profit and loss reserves
350,336
318,747
Total equity
350,338
318,749
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 18 October 2023 and are signed on its behalf by:
Mr C M Wollen
Director
Company Registration No. 03823788
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2023
- 2 -
1
Accounting policies
Company information
Ergro Technical Services Limited is a private company limited by shares incorporated in England and Wales. The registered office is 1 Vicarage Lane, Stratford, London, England, E15 4HF.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
At the time of signing the financial statements the company has a healthy pipeline of work at present and the latest management information and projections show the company making a healthy profit for the 202true4 accounting year. The directors are therefore confident that the company will continue to perform well and that the company will continue to operate as a going concern for the foreseeable future. |
1.3
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discounts.
In respect of long-term contracts and contracts for ongoing services, turnover represents the value of work done in the year, including estimates of amounts not invoiced. Turnover in respect of long-term contracts and contracts for on-going services is recognised by reference to the stage of completion.
Services and support contract revenue is recognised evenly over the period of the contract.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
30% reducing balance
Motor vehicles
30% reducing balance.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies
(Continued)
- 3 -
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies
(Continued)
- 4 -
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
1
Accounting policies
(Continued)
- 5 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 6 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Impairment of group and related party loans
The Company makes an estimate of the recoverable value of group loans. When assessing the impairment of group loans management considers whether there is objective evidence of impairment including:
economic or legal reasons relating to the debtors financial difficult; and
observable data indicating that there has been a measurable decrease in the estimated future cash flows from a group of financial assets since the initial recognition of those asset.
Revenue recognition on long term contracts
The amount recognised as turnover in respect of long term contract is ascertained by reference to the value of the work carried out to date and consists of direct costs and profit element. This is based on management's judgement that these relate to time and costs as reported on the valuation statements of work.
3
Auditor's remuneration
The company audit fee of £7,050 is recognised in Ergro Group Limited.
4
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
36
36
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 7 -
5
Tangible fixed assets
Plant and machinery
Motor vehicles
Total
£
£
£
Cost
At 1 May 2022
10,198
376,386
386,584
Additions
546
84,022
84,568
Disposals
(126,791)
(126,791)
At 30 April 2023
10,744
333,617
344,361
Depreciation and impairment
At 1 May 2022
6,523
133,834
140,357
Depreciation charged in the year
1,881
76,118
77,999
Eliminated in respect of disposals
(73,010)
(73,010)
At 30 April 2023
8,404
136,942
145,346
Carrying amount
At 30 April 2023
2,340
196,675
199,015
At 30 April 2022
3,675
242,552
246,227
The net book value of tangible fixed assets in respect of assets held under finance leases or hire purchase contracts is £196,675 (2022: £242,552). The depreciation charge in respect of such assets amounted to £36,908 (2022: £107,125) for the year.
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
957,701
1,257,838
Corporation tax recoverable
1,716
Amounts owed by group undertakings
868,296
849,121
Other debtors
98,014
52,215
Prepayments and accrued income
51,094
4,400
1,975,105
2,165,290
The amounts due from group undertakings are interest free and unsecured, interest free and have no fixed date of repayment.
ERGRO TECHNICAL SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2023
- 8 -
7
Creditors: amounts falling due within one year
2023
2022
£
£
Obligations under finance leases
73,800
114,203
Trade creditors
438,428
317,899
Corporation tax
43,411
Other taxation and social security
437,267
303,156
Other creditors
317,060
474,006
Accruals and deferred income
445,197
588,260
1,755,163
1,797,524
8
Creditors: amounts falling due after more than one year
2023
2022
£
£
Obligations under finance leases
49,931
79,860
Taxation and social security
47,730
Other creditors
149,700
294,735
199,631
422,325
9
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
2 Ordinary of £1 each
2
2
10
Related party transactions
As at the balance sheet date, the outstanding balances due from related companies were as follows:
Ergro Group Limited 2023: £868,296 2022: £849,121
All companies are controlled by Mr C M Wollen.
11
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
The senior statutory auditor was Mark Middleton.
The auditor was LB Group (Stratford).