REGISTERED NUMBER: |
Report of the Directors and |
Unaudited Financial Statements for the Year Ended 31st March 2023 |
for |
REDSQUID COMMUNICATIONS LTD |
REGISTERED NUMBER: |
Report of the Directors and |
Unaudited Financial Statements for the Year Ended 31st March 2023 |
for |
REDSQUID COMMUNICATIONS LTD |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Contents of the Financial Statements |
for the year ended 31st March 2023 |
Page |
Company Information | 1 |
Report of the Directors | 2 |
Chartered Accountants' Report | 3 |
Income Statement | 4 |
Other Comprehensive Income | 5 |
Balance Sheet | 6 |
Statement of Changes in Equity | 8 |
Notes to the Financial Statements | 9 |
REDSQUID COMMUNICATIONS LTD |
Company Information |
for the year ended 31st March 2023 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
ACCOUNTANTS: |
2 Burton House |
Repton Place |
White Lion Road |
Amersham |
Buckinghamshire |
HP7 9LP |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Report of the Directors |
for the year ended 31st March 2023 |
The directors present their report with the financial statements of the company for the year ended 31st March 2023. |
REVIEW OF BUSINESS |
In June 2021, the acquisition of Triumph Technologies bolstered Redsquid's capability to provide IT Managed/Security services to its established customer base. The year 2022 witnessed Redsquid effectively leveraging this strategic advantage through the successful execution of diverse projects. As businesses expedite their digital transformation initiatives in anticipation of the PSTN switch-off, Redsquid is prepared to sustain this momentum throughout 2023. |
Furthermore, Redsquid is actively aligning itself with the prevailing trend of organisational service consolidation, accompanied by the integration of robust cyber security measures into business operations. This strategic alignment positions Redsquid to capitalize on growth opportunities. |
Looking forward, Redsquid remains dedicated to its commitment to delivering exceptional IT Managed/Security services, proactively responding to industry shifts, and fostering continued growth in line with emerging market dynamics driven by cyber security trends. |
The recent acquisitions of Couve IT and ACR in July 2023 have significantly bolstered Redsquid's operational capabilities, positioning us to explore diversification within the Education sector. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1st April 2022 to the date of this report. |
This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small companies. |
ON BEHALF OF THE BOARD: |
Chartered Accountants' Report to the Board of Directors |
on the Unaudited Financial Statements of |
Redsquid Communications Ltd |
In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of Redsquid Communications Ltd for the year ended 31st March 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and the related notes from the company's accounting records and from information and explanations you have given us. |
As a practising member firm of the Institute of Chartered Accountants in England and Wales (ICAEW), we are subject to its ethical and other professional requirements which are detailed within the ICAEW's regulations and guidance at http://www.icaew.com/en/membership/regulations-standards-and-guidance. |
This report is made solely to the Board of Directors of Redsquid Communications Ltd, as a body, in accordance with our terms of engagement. Our work has been undertaken solely to prepare for your approval the financial statements of Redsquid Communications Ltd and state those matters that we have agreed to state to the Board of Directors of Redsquid Communications Ltd, as a body, in this report in accordance with ICAEW Technical Release 07/16AAF. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Redsquid Communications Ltd and its Board of Directors, as a body, for our work or for this report. |
It is your duty to ensure that Redsquid Communications Ltd has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and profit of Redsquid Communications Ltd. You consider that Redsquid Communications Ltd is exempt from the statutory audit requirement for the year. |
We have not been instructed to carry out an audit or a review of the financial statements of Redsquid Communications Ltd. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements. |
2 Burton House |
Repton Place |
White Lion Road |
Amersham |
Buckinghamshire |
HP7 9LP |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Income Statement |
for the year ended 31st March 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
TURNOVER |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
OPERATING PROFIT/(LOSS) | 4 | ( |
) |
Income from shares in group undertakings |
Interest receivable and similar income |
906,797 | 562,507 |
1,084,524 | 488,130 |
Interest payable and similar expenses |
PROFIT BEFORE TAXATION |
Tax on profit | 5 | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Other Comprehensive Income |
for the year ended 31st March 2023 |
2023 | 2022 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Balance Sheet |
31st March 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 6 |
Tangible assets | 7 |
Investments | 8 |
CURRENT ASSETS |
Stocks |
Debtors | 9 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 10 |
NET CURRENT ASSETS/(LIABILITIES) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
11 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | ( |
) | ( |
) |
NET ASSETS/(LIABILITIES) | ( |
) |
CAPITAL AND RESERVES |
Called up share capital |
Retained earnings | ( |
) |
SHAREHOLDERS' FUNDS | ( |
) |
The directors acknowledge their responsibilities for: |
(a) | ensuring that the company keeps accounting records which comply with Sections 386 and 387 of the Companies Act 2006 and |
(b) | preparing financial statements which give a true and fair view of the state of affairs of the company as at the end of each financial year and of its profit or loss for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the company. |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Balance Sheet - continued |
31st March 2023 |
The financial statements were approved by the Board of Directors and authorised for issue on |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Statement of Changes in Equity |
for the year ended 31st March 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1st April 2021 | ( |
) | ( |
) |
Changes in equity |
Total comprehensive income | - |
Balance at 31st March 2022 | ( |
) | ( |
) |
Changes in equity |
Total comprehensive income | - |
Balance at 31st March 2023 |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Notes to the Financial Statements |
for the year ended 31st March 2023 |
1. | STATUTORY INFORMATION |
Redsquid Communications Ltd is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Preparation of consolidated financial statements |
The financial statements contain information about Redsquid Communications Ltd as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 399(2A) of the Companies Act 2006 from the requirements to prepare consolidated financial statements. |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Turnover |
Turnover represents net invoiced sales of goods and services, excluding value added tax, except in respect of service contracts where turnover is recognised when the company obtains the right to consideration. |
Goodwill |
Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. |
Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years. |
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows: |
Goodwill - over 10 years |
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates. |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Tangible fixed assets |
Plant and machinery etc | - |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Notes to the Financial Statements - continued |
for the year ended 31st March 2023 |
2. | ACCOUNTING POLICIES - continued |
Investments in subsidiaries |
Investments in subsidiary undertakings are recognised at cost. |
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses. |
Stocks |
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
3. | EMPLOYEES AND DIRECTORS |
The average number of employees during the year was |
4. | OPERATING PROFIT/(LOSS) |
The operating profit (2022 - operating loss) is stated after charging: |
2023 | 2022 |
£ | £ |
Depreciation - owned assets |
Goodwill amortisation |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Notes to the Financial Statements - continued |
for the year ended 31st March 2023 |
5. | TAXATION |
Analysis of the tax charge/(credit) |
The tax charge/(credit) on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax |
R&D credits | - | (26,225 | ) |
Total current tax | ( |
) |
Deferred tax |
Tax on profit | ( |
) |
6. | INTANGIBLE FIXED ASSETS |
Goodwill |
£ |
COST |
At 1st April 2022 |
and 31st March 2023 |
AMORTISATION |
At 1st April 2022 |
Charge for year |
At 31st March 2023 |
NET BOOK VALUE |
At 31st March 2023 |
At 31st March 2022 |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Notes to the Financial Statements - continued |
for the year ended 31st March 2023 |
6. | INTANGIBLE FIXED ASSETS - continued |
The company's policy upon acquisition of a subsidiary in 2015 was to transfer the trade and net assets of the newly-acquired subsidiary to the company at book value. The initial cost of the company's investment in the subsidiary undertaking reflects the underlying fair value of its net assets and goodwill at the time of its acquisition. As a result of the transfer, the value of the company's investment in the subsidiary undertaking falls below the amount at which it is stated in the accounting records. The Companies Act 2006 requires that the investment be written down accordingly and that the amount be charged as a loss in the company's income statement. |
However, the directors consider that, as there has been no overall loss to the company, it would fail to give a true and fair view to charge the diminution to the company's income statement and it should instead be re-allocated to goodwill so as to recognise the effective cost to the company of those net assets and goodwill. |
The effect on the company's statement of financial position is to recognise goodwill at a value of £1,200,000 (2022: £1,200,000). Given that the business concerned operates in a generally stable market, the directors have concluded that the estimated economic life of the intangible asset is ten years from the date that the transfer took place. The asset is reviewed annually for impairment. The review in February 2023 indicated that no impairment had arisen. |
The company's investment in Ridgeway Telecoms Limited has been treated on the above basis. The operations of Ridgeway Telecoms Limited, a wholly owned subsidiary, were hived up into the company. This exercise was carried out at the earliest practical opportunity and the subsidiary has been subsequently retained as a non-trading company. The directors consider that there has been no overall loss to the company as a result of the hive-up and hence the intrinsic value has been reclassified as goodwill and is being amortised over its estimated economic life. |
7. | TANGIBLE FIXED ASSETS |
Plant and |
machinery |
etc |
£ |
COST |
At 1st April 2022 |
Additions |
At 31st March 2023 |
DEPRECIATION |
At 1st April 2022 |
Charge for year |
At 31st March 2023 |
NET BOOK VALUE |
At 31st March 2023 |
At 31st March 2022 |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Notes to the Financial Statements - continued |
for the year ended 31st March 2023 |
8. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertakings |
£ |
COST |
At 1st April 2022 |
and 31st March 2023 |
NET BOOK VALUE |
At 31st March 2023 |
At 31st March 2022 |
The company's investments at the Balance Sheet date in the share capital of companies include the following: |
Registered office: Premiere House, Elstree Way, Borehamwood, WD6 1JH |
Nature of business: |
% |
Class of shares: | holding |
The company's policy upon acquisition of Ridgeway Telecoms Limited was to transfer the trade and net assets of the subsidiary to the company at book value. The initial cost of the company's investment in the subsidiary undertaking reflects the underlying fair value of its net assets and goodwill at the time of its acquisition. As a result of the transfer, the value of the company's investment in the subsidiary undertaking falls below the amount at which it is stated in the accounting records. The Companies Act 2006 requires that the investment be written down accordingly and that the amount be charged as a loss in the company's income statement. |
However, the directors consider that, as there has been no overall loss to the company, it would fail to give a true and fair view to charge the diminution to the company's income statement and it should instead be re-allocated to goodwill so as to recognise the effective cost to the company of those net assets and goodwill. |
The company's investment in Ridgeway Telecoms Limited has been treated on the above basis. The operations of Ridgeway Telecoms Limited, a wholly owned subsidiary, were hived up into the company. This exercise was carried out at the earliest practical opportunity and the subsidiary has been subsequently retained as a non-trading company. The directors consider that there has been no overall loss to the company as a result of the hive-up and hence the intrinsic value has been reclassified as goodwill and is being amortised over its estimated economic life. |
Registered office: Premiere House, Elstree Way, Borehamwood, WD6 1JH |
Nature of business: |
% |
Class of shares: | holding |
REDSQUID COMMUNICATIONS LTD (REGISTERED NUMBER: 04968485) |
Notes to the Financial Statements - continued |
for the year ended 31st March 2023 |
9. | DEBTORS |
2023 | 2022 |
£ | £ |
Amounts falling due within one year: |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Tax |
Prepayments and accrued income |
Amounts falling due after more than one year: |
Other debtors |
Aggregate amounts |
10. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Bank loans and overdrafts |
Trade creditors |
Amounts owed to group undertakings |
Corporation tax |
Social security and other taxes |
VAT | 136,351 | 101,225 |
Other creditors |
Accruals and deferred income |
11. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2023 | 2022 |
£ | £ |
Bank loans - 1-2 years |
Bank loans - 2-5 years |
The bank loans are secured by a debenture including a fixed and floating charge over all assets and undertakings both present and future. The bank has a cross guarantee given by the company and its direct subsidiaries, Ridgeway Phones Limited and Triumph Technologies Limited. In addition, there is a limited joint and several personal guarantee provided by the shareholders of the company. |
12. | ULTIMATE CONTROLLING PARTY |
The company is controlled by Mr V Mignacca and Mr S Raithatha, directors and each owners of 50% of the issued share capital of the company. |