Company registration number 10093876 (England and Wales)
WCM INVESTMENTS LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
WCM INVESTMENTS LTD
COMPANY INFORMATION
Directors
Mr K N McGee
Mr R Anderson
Secretary
Mr K N McGee
Company number
10093876
Registered office
Innovation House
One Juniper West
Fenton Way
Basildon
Essex
United Kingdom
SS15 6TD
Auditor
BDO LLP
55 Baker Street
London
United Kingdom
W1U 7EU
WCM INVESTMENTS LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Profit and loss account
9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
12
Group statement of changes in equity
13
Company statement of changes in equity
14
Group statement of cash flows
15
Notes to the financial statements
16 - 37
WCM INVESTMENTS LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

The directors present the strategic report for the year ended 31 December 2022.

WCM Investments Limited was incorporated on 31st March 2016 . The main trading subsidiary is WCM Europe Limited which has been trading for many years. CMA Moldform Limited joined the group on 31st March 2018 and Kaidex Limited joined in March 2021.

This report is partly derived from the strategic report contained within the financial statements of the main subsidiary company WCM Europe Ltd, which carried out a substantial part of the trading activity for the group during the period under review.

Review of the business

2022 started brightly with ongoing enquiries and a strong order book. From spring the Directors invested heavily into the business both in capital equipment and personnel based on schedules provided by OEMS and the start of new vehicle production projects. The semiconductor shortage however stagnated demand from the OEMS through the later part of the year which ultimately led to the financial results incurred.

 

The company continued with its investment into the infrastructure of the business through further asset purchases totalling £2,873k and continued investment into the personnel of the business. This has impacted favourably on the business’s future activity with the Company currently holding its largest ever order book albeit the start of a lot of the new production vehicles mean that the second half of 2023 will be see the start of significant growth.

Principal risks and uncertainties

The principal risks and uncertainties faced by the group remain largely economic with the ongoing uncertainty concerning the impact of Covid-19 on the semiconductor and material supply chain to the automotive sector. The Directors are well aware of the group's associations with the automotive sector, and the fact that it can be impacted upon in times of economic downturn and issues caused by the pandemic. Current economic indicators and experience suggest that the automotive position the Group supplies to continues to improve with the strongest order book the Groupy has had together with increased enquiries being received with regard to new vehicle developments and demand for existing vehicle ranges. The Directors believe that the Group has been successful at diversifying its risk profile by continue to develop a range of innovative products and processes.

 

Research and Development

The group continues to expend substantial time and cost on research and development into new products and processes.

Key performance indicators

The financial year saw the following indicators for the group:

- A 5% decrease in turnover.

- Gross margin 21.5% compared with 22% in 2021.

- Net loss of £264,810 compared with a net profit of £413,427 in 2021.

- A dividend of £110,000 paid to its shareholders compared to £20,000 in 2021.

 

In addition to the above financial data, the Directors believe that non-financial data suggests that the group is on track to maintain its desired objectives. In particular, factors such as employee retention and customer enquiries are key indicators of positive trends.

Future developments

The group is optimistic that trading conditions will continue to improve in the higher end of the automotive sector through 2022 as the semiconductor supply issue has eased significantly.The group is well placed to exploit the market potential and continue to maintain and expand its business and continue to develop new products and processes and strengthen its relationships with customers and suppliers. Indeed, the current order book is the best the group has experienced.

 

Business development continues to be a key for the group and work is ongoing to expand the customer base into new luxury brands in the automotive sector and also to use its expertise in other luxury goods markets.

 

 

WCM INVESTMENTS LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -

On behalf of the board

Mr K N McGee
Director
9 November 2023
WCM INVESTMENTS LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -

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

Principal activities

The principal activity of the company and group continued to be that of design, prototyping, tooling and moulding manufacture.

Results and dividends

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £110,000. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr K N McGee
Mr R Anderson
Post reporting date events

Information relating to events since the end of the year is given in the notes to the financial statements

Auditor

The directors consider that the group and company auditors, BDO should be re-appointed for the coming year.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
Mr K N McGee
Director
9 November 2023
WCM INVESTMENTS LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 4 -

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

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

WCM INVESTMENTS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF WCM INVESTMENTS LTD
- 5 -
Opinion

In our opinion the financial statements:

We have audited the financial statements of WCM Investments Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a bais for our opinion.

 

Independence

We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

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 and 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.

Other information

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

 

We have nothing to report in this regard.

WCM INVESTMENTS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WCM INVESTMENTS LTD
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

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

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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

WCM INVESTMENTS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WCM INVESTMENTS LTD
- 7 -

Extent to which the audit was capable of detecting irregularities, including fraud

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:

 

Non-compliance with laws and regulations

Based on:

we considered the significant laws and regulations to be the applicable accounting framework, UK tax legislation, etc.

 

The Group is also subject to laws and regulations where the consequence of non-compliance could have a material effect on the amount or disclosures in the financial statements, for example through the imposition of fines or litigations. We identified such laws and regulations to be the health and safety legislation.

 

Our procedures in respect of the above included:

 

Fraud

We assessed the susceptibility of the financial statements to material misstatement, including fraud. Our risk assessment procedures included:

 

Based on our risk assessment, we considered the areas most susceptible to fraud to be management override of controls.

 

Our procedures in respect of the above included:

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

 

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

 

A further description of our responsibilities is available on the Financial Reporting Council’s website at:

https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

 

 

WCM INVESTMENTS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WCM INVESTMENTS LTD
- 8 -

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 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Richard Willis (Senior Statutory Auditor)
For and on behalf of BDO LLP
13 November 2023
55 Baker Street
Statutory Auditor
London
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
W1U 7EU
WCM INVESTMENTS LTD
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
2022
2021
Notes
£
£
Turnover
3
23,955,078
25,266,608
Cost of sales
(18,787,380)
(19,603,089)
Gross profit
5,167,698
5,663,519
Administrative expenses
(5,756,408)
(5,366,830)
Other operating income
-
139,700
Operating (loss)/profit
6
(588,710)
436,389
Interest payable and similar expenses
7
(362,539)
(279,824)
(Loss)/profit before taxation
(951,249)
156,565
Tax on (loss)/profit
8
686,439
256,862
(Loss)/profit for the financial year
26
(264,810)
413,427
(Loss)/profit for the financial year is all attributable to the owners of the parent company.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

WCM INVESTMENTS LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 10 -
2022
2021
£
£
(Loss)/profit for the year
(264,810)
413,427
Other comprehensive income
Revaluation of tangible fixed assets
(1,835,000)
5,227,797
Tax relating to other comprehensive income
455,000
(1,325,000)
Other comprehensive income for the year
(1,380,000)
3,902,797
Total comprehensive income for the year
(1,644,810)
4,316,224
Total comprehensive income for the year is all attributable to the owners of the parent company.
WCM INVESTMENTS LTD
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 11 -
2022
2021
Notes
£
£
£
£
Fixed assets
Goodwill
10
1,369,038
1,693,408
Tangible assets
11
15,009,668
15,157,062
Investments
13
198,610
234,360
16,577,316
17,084,830
Current assets
Stocks
15
3,215,439
3,007,825
Debtors
16
6,768,755
6,839,627
Investments
17
496,299
439,053
Cash at bank and in hand
433,949
207,160
10,914,442
10,493,665
Creditors: amounts falling due within one year
18
(11,110,945)
(10,420,104)
Net current (liabilities)/assets
(196,503)
73,561
Total assets less current liabilities
16,380,813
17,158,391
Creditors: amounts falling due after more than one year
19
(6,069,233)
(4,635,601)
Provisions for liabilities
Deferred tax liability
22
970,000
1,426,400
(970,000)
(1,426,400)
Net assets
9,341,580
11,096,390
Capital and reserves
Called up share capital
24
6,278,000
6,278,000
Revaluation reserve
25
2,946,982
4,326,982
Profit and loss reserves
26
116,598
491,408
Total equity
9,341,580
11,096,390
The financial statements were approved by the board of directors and authorised for issue on 9 November 2023 and are signed on its behalf by:
09 November 2023
Mr K N McGee
Director
Company registration number 10093876 (England and Wales)
WCM INVESTMENTS LTD
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2022
31 December 2022
- 12 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
11
8,481,264
10,113,352
Investments
13
6,476,510
6,476,510
14,957,774
16,589,862
Current assets
Stocks
15
502,359
502,359
Debtors
16
48,871
17,701
Investments
17
49
49
Cash at bank and in hand
162,965
4,553
714,244
524,662
Creditors: amounts falling due within one year
18
(537,891)
(789,846)
Net current assets/(liabilities)
176,353
(265,184)
Total assets less current liabilities
15,134,127
16,324,678
Creditors: amounts falling due after more than one year
19
(3,845,536)
(3,128,220)
Provisions for liabilities
Deferred tax liability
22
970,000
1,425,000
(970,000)
(1,425,000)
Net assets
10,318,591
11,771,458
Capital and reserves
Called up share capital
24
6,278,000
6,278,000
Revaluation reserve
25
2,946,982
4,326,982
Profit and loss reserves
26
1,093,609
1,166,476
Total equity
10,318,591
11,771,458

As permitted by S408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £37,133 (2021 - £231,601 profit).

The financial statements were approved by the board of directors and authorised for issue on 9 November 2023 and are signed on its behalf by:
09 November 2023
Mr K N McGee
Director
Company registration number 10093876 (England and Wales)
WCM INVESTMENTS LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 13 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2021
6,278,000
424,185
97,981
6,800,166
Year ended 31 December 2021:
Loss and total comprehensive expenses for the year
-
-
413,427
413,427
Other comprehensive income:
Revaluation of tangible fixed assets
-
5,227,797
-
5,227,797
Tax relating to other comprehensive income
-
(1,325,000)
-
0
(1,325,000)
Total comprehensive income for the year
-
3,902,797
413,427
4,316,224
Dividends
9
-
-
(20,000)
(20,000)
Balance at 31 December 2021
6,278,000
4,326,982
491,408
11,096,390
Year ended 31 December 2022:
Loss for the year
-
-
(264,810)
(264,810)
Other comprehensive income:
Revaluation of tangible fixed assets
-
(1,835,000)
-
(1,835,000)
Tax relating to other comprehensive income
-
455,000
-
0
455,000
Total comprehensive income for the year
-
(1,380,000)
(264,810)
(1,644,810)
Dividends
9
-
-
(110,000)
(110,000)
Balance at 31 December 2022
6,278,000
2,946,982
116,598
9,341,580
WCM INVESTMENTS LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 14 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2021
6,278,000
424,185
954,875
7,657,060
Year ended 31 December 2021:
Profit for the year
-
-
231,601
231,601
Other comprehensive income:
Revaluation of tangible fixed assets
-
5,227,797
-
5,227,797
Tax relating to other comprehensive income
-
(1,325,000)
-
0
(1,325,000)
Total comprehensive income
-
3,902,797
231,601
4,134,398
Dividends
9
-
-
(20,000)
(20,000)
Balance at 31 December 2021
6,278,000
4,326,982
1,166,476
11,771,458
Year ended 31 December 2022:
Profit for the year
-
-
37,133
37,133
Other comprehensive income:
Revaluation of tangible fixed assets
-
(1,835,000)
-
(1,835,000)
Tax relating to other comprehensive income
-
455,000
-
0
455,000
Total comprehensive income
-
(1,380,000)
37,133
(1,342,867)
Dividends
9
-
-
(110,000)
(110,000)
Balance at 31 December 2022
6,278,000
2,946,982
1,093,609
10,318,591
WCM INVESTMENTS LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 15 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
30
1,147,761
(1,122,050)
Interest paid
(362,539)
(279,824)
Income taxes refunded
185,362
2,900
Net cash inflow/(outflow) from operating activities
970,584
(1,398,974)
Investing activities
Purchase of intangible assets
-
(804,467)
Purchase of tangible fixed assets
(394,526)
(277,667)
Proceeds from disposal of tangible fixed assets
253,407
299,934
Proceeds from disposal of subsidiaries, net of cash disposed
-
955,050
Proceeds from disposal of investments
(21,496)
(35,799)
Net cash (used in)/generated from investing activities
(162,615)
137,051
Financing activities
Proceeds from new bank loans
4,000,000
-
Repayment of bank loans
(3,511,763)
(386,757)
Payment of finance leases obligations
(1,502,282)
(991,917)
Dividends paid to equity shareholders
(110,000)
(20,000)
Net cash used in financing activities
(1,124,045)
(1,398,674)
Net decrease in cash and cash equivalents
(316,076)
(2,660,597)
Cash and cash equivalents at beginning of year
(3,380,260)
(719,663)
Cash and cash equivalents at end of year
(3,696,336)
(3,380,260)
Relating to:
Cash at bank and in hand
433,949
207,160
Bank overdrafts included in creditors payable within one year
(4,130,285)
(3,587,420)
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 16 -
1
Accounting policies
Company information

WCM Investments Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Innovation House, One Juniper West, Fenton Way, Basildon, Essex, United Kingdom, SS15 6TD.

 

The group consists of WCM Investments Ltd and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, [modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 17 -
1.3
Basis of consolidation

The consolidated financial statements incorporate those of WCM Investments Ltd and all of its subsidiaries (i.e. entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.

 

All financial statements are made up to 31 December 2022. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

1.4
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.6
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is ten years. The directors believe that ten years is an appropriate amortisation period as it fairly reflects the economic useful life of the goodwill acquired.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 18 -
1.7
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:

Freehold land and buildings
2% on cost
Leasehold land and buildings
Over the duration of the lease
Plant and equipment
10% on cost
Fixtures and fittings
20% on cost
Motor vehicles
20% on cost

Freehold land and assets in the course of construction are not depreciated.

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 recognised in the profit and loss account.

Properties whose fair value can be measured reliably are held under the revaluation model and are carried at a revalued amount, being their fair value at the date of valuation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. The fair value of the land and buildings is usually considered to be their market value.

 

Revaluation gains and losses are recognised in other comprehensive income and accumulated in equity, except to the extent that a revaluation gain reverses a revaluation loss previously recognised in profit or loss or a revaluation loss exceeds the accumulated revaluation gains recognised in equity; such gains and loss are recognised in profit or loss.

 

1.8
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 19 -

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.9
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

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 is estimated to be less than its carrying amount, the carrying amount of the asset 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.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 20 -
1.10
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.

 

Work in progress is stated at cost and represents expenses incurred in the redevelopment of properties.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of replacement cost and 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.

1.11
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.

1.12
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 21 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group 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.

Other financial liabilities

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

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

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 22 -
1.13
Equity instruments

Equity instruments issued by the group 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 group.

1.14
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is 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.

1.15
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.

1.16
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.17
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.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 23 -

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

1.18
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.19
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the group’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.

Property valuation

The Company’s property is held at fair value as determined by the independent external valuer on the basis of fair value in accordance with the internationally accepted RICS Appraisal and Valuation Standards

3
Turnover and other revenue

An analysis of the group's turnover is as follows:

2022
2021
£
£
Turnover analysed by class of business
Design, prototyping, tooling and moulding manufacture
23,955,078
25,266,608
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
3
Turnover and other revenue
(Continued)
- 24 -
2022
2021
£
£
Other significant revenue
Grants received
-
129,028

Grants received of £nil (2021 - £129,028) were under the Government Coronavirus Job Retention Scheme.

2022
2021
£
£
Turnover analysed by geographical market
United Kingdom
18,383,798
22,177,579
Europe
5,350,674
2,822,029
Rest of the world
220,606
267,000
23,955,078
25,266,608
4
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
8,150
8,200
Audit of the financial statements of the company's subsidiaries
35,850
33,600
44,000
41,800
5
Employees

The average monthly number of persons (including directors) employed by the group during the year was:

Group
Company
2022
2021
2022
2021
Number
Number
Number
Number
Administrative
60
65
-
-
Direct
120
133
-
-
Total
180
198
-
0
-
0
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
5
Employees
(Continued)
- 25 -

Their aggregate remuneration comprised:

Group
Company
2022
2021
2022
2021
£
£
£
£
Wages and salaries
5,675,065
6,228,062
-
0
-
0
Social security costs
524,160
492,079
-
(123)
Pension costs
158,438
153,785
-
0
-
0
6,357,663
6,873,926
-
0
(123)

The key management are considered to be K McGee and R Anderson.

6
Operating (loss)/profit
2022
2021
£
£
Operating (loss)/profit for the year is stated after charging/(crediting):
Exchange gains
(16,717)
-
Government grants
-
(129,028)
Depreciation of owned tangible fixed assets
460,947
587,835
Depreciation of tangible fixed assets held under finance leases
582,740
513,787
Profit on disposal of tangible fixed assets
(56,227)
(9,874)
Amortisation of intangible assets
324,370
324,370
Operating lease charges
563,095
556,716
7
Interest payable and similar expenses
2022
2021
£
£
Interest on bank overdrafts and loans
131,660
80,702
Interest on finance leases and hire purchase contracts
230,879
199,122
Total finance costs
362,539
279,824
8
Taxation
2022
2021
£
£
Current tax
Adjustments in respect of prior periods
(685,039)
(255,362)
Deferred tax
Origination and reversal of timing differences
(1,400)
(1,500)
Total tax credit
(686,439)
(256,862)
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
8
Taxation
(Continued)
- 26 -

The actual credit for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:

2022
2021
£
£
(Loss)/profit before taxation
(951,249)
156,565
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
(180,737)
29,747
Tax effect of expenses that are not deductible in determining taxable profit
61,600
2,178
Tax effect of income not taxable in determining taxable profit
(11,928)
-
0
Tax effect of utilisation of tax losses not previously recognised
-
0
61,043
Unutilised tax losses carried forward
423,652
-
0
Adjustments in respect of prior years
(505,039)
(245,377)
Research and development tax credit
(180,000)
-
0
Deferred tax adjustments in respect of prior years
1,400
-
0
Tax effect of capital allowances
(295,387)
(104,453)
Taxation credit
(686,439)
(256,862)

In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:

2022
2021
£
£
Deferred tax arising on:
Revaluation of property
(455,000)
1,325,000
9
Dividends
2022
2021
Recognised as distributions to equity holders:
£
£
Interim paid
110,000
20,000
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 27 -
10
Intangible fixed assets
Group
Goodwill
Negative goodwill
Total
£
£
£
Cost
At 1 January 2022 and 31 December 2022
3,237,393
(2,194)
3,235,199
Amortisation and impairment
At 1 January 2022
1,543,985
(2,194)
1,541,791
Amortisation charged for the year
324,370
-
0
324,370
At 31 December 2022
1,868,355
(2,194)
1,866,161
Carrying amount
At 31 December 2022
1,369,038
-
0
1,369,038
At 31 December 2021
1,693,408
-
0
1,693,408
The company had no intangible fixed assets at 31 December 2022 or 31 December 2021.

The goodwill arose on the acquisition of WCM Europe Limited when the group commenced and the acquisition of Kaidex Ltd during the previous year.

Negative goodwill arose on the acquisition of CMA Moldform Ltd.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 28 -
11
Tangible fixed assets
Group
Freehold land and buildings
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost or valuation
At 1 January 2022
10,105,000
39,115
7,158,766
608,617
937,261
18,848,759
Additions
205,000
-
0
1,221,855
299,006
1,202,612
2,928,473
Disposals
-
0
-
0
(722,578)
-
0
(294,514)
(1,017,092)
Revaluation
(1,835,000)
-
0
-
0
-
0
-
0
(1,835,000)
At 31 December 2022
8,475,000
39,115
7,658,043
907,623
1,845,359
18,925,140
Depreciation and impairment
At 1 January 2022
-
0
39,115
2,992,328
395,899
264,355
3,691,697
Depreciation charged in the year
-
0
-
0
785,771
94,700
163,216
1,043,687
Eliminated in respect of disposals
-
0
-
0
(669,755)
-
0
(150,157)
(819,912)
At 31 December 2022
-
0
39,115
3,108,344
490,599
277,414
3,915,472
Carrying amount
At 31 December 2022
8,475,000
-
0
4,549,699
417,024
1,567,945
15,009,668
At 31 December 2021
10,105,000
-
0
4,166,438
212,718
672,906
15,157,062
Company
Freehold land and buildings
Fixtures and fittings
Total
£
£
£
Cost or valuation
At 1 January 2022
10,105,000
10,440
10,115,440
Additions
205,000
-
0
205,000
Revaluation
(1,835,000)
-
0
(1,835,000)
At 31 December 2022
8,475,000
10,440
8,485,440
Depreciation and impairment
At 1 January 2022
-
0
2,088
2,088
Depreciation charged in the year
-
0
2,088
2,088
At 31 December 2022
-
0
4,176
4,176
Carrying amount
At 31 December 2022
8,475,000
6,264
8,481,264
At 31 December 2021
10,105,000
8,352
10,113,352
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
11
Tangible fixed assets
(Continued)
- 29 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2022
2021
2022
2021
£
£
£
£
Plant and equipment
3,493,886
2,923,250
-
0
-
0
Motor vehicles
1,154,356
595,198
-
0
-
0
4,648,242
3,518,448
-
-

Freehold land and buildings with a carrying amount of £8,475,000(2021 - £10,105,000) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.

Land and buildings with a carrying amount of £8,475,000 ares hown at fair value, based on valuations undertaken by JLL, independent valuers not connected with the company.

The revaluation surplus is disclosed in the notes.

Land and buildings are carried at valuation. If land and buildings were measured using the cost model, the carrying amounts for the group would have been approximately £4,353,018 (2021 - £4,343,018), being cost £4,353,018 (2021 - £4,343,018) and depreciation £0 (2021 - £0). The carrying amounts for the company would have been the same.

12
Subsidiaries

Details of the company's subsidiaries at 31 December 2022 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
WCM Europe Ltd
England and Wales
Ordinary
100.00
-
CMA Moldform Limited
England and Wales
Ordinary
100.00
-
Kaidex Limited
England and Wales
Ordinary
-
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
WCM Europe Ltd
4,960,857
72,740
CMA Moldform Limited
24,837
16,111
Kaidex Limited
5,873
(159,643)

The investments in subsidiaries are stated at cost.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 30 -
13
Fixed asset investments
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Investments in subsidiaries
12
-
0
-
0
6,277,900
6,277,900
Unlisted investments
198,610
234,360
198,610
198,610
198,610
234,360
6,476,510
6,476,510
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 January 2022
234,360
Disposals
(35,750)
At 31 December 2022
198,610
Carrying amount
At 31 December 2022
198,610
At 31 December 2021
234,360
Movements in fixed asset investments
Company
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 January 2022 and 31 December 2022
6,277,900
198,610
6,476,510
Carrying amount
At 31 December 2022
6,277,900
198,610
6,476,510
At 31 December 2021
6,277,900
198,610
6,476,510
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 31 -
14
Financial instruments
Group
Company
2022
2021
2022
2021
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
5,444,201
6,012,768
n/a
n/a
Equity instruments measured at cost less impairment
198,610
234,360
n/a
n/a
Instruments measured at fair value through profit or loss
496,299
439,053
49
49
Carrying amount of financial liabilities
Measured at amortised cost
16,750,115
13,666,744
n/a
n/a

As permitted by the reduced disclosure framework within FRS 102, the company has taken advantage of the exemption from disclosing the carrying amount of certain classes of financial instruments, denoted by 'n/a' above.

15
Stocks
Group
Company
2022
2021
2022
2021
£
£
£
£
Raw materials and consumables
525,182
599,350
-
-
Work in progress
502,359
502,359
502,359
502,359
Finished goods and goods for resale
2,187,898
1,906,116
-
0
-
0
3,215,439
3,007,825
502,359
502,359

Work in progress represents costs incurred on two properties bought for redevelopment and resale.

16
Debtors
Group
Company
2022
2021
2022
2021
Amounts falling due within one year:
£
£
£
£
Trade debtors
5,238,520
5,900,462
-
0
-
0
Corporation tax recoverable
760,506
260,829
5,467
5,467
Amounts owed by group undertakings
59,617
-
-
-
Amounts owed by undertakings in which the company has a participating interest
-
12,104
-
12,104
Other debtors
146,710
100,332
4,071
130
Prepayments and accrued income
563,402
565,900
39,333
-
0
6,768,755
6,839,627
48,871
17,701
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 32 -
17
Current asset investments
Group
Company
2022
2021
2022
2021
£
£
£
£
Unlisted investments
496,299
439,053
49
49

Current asset investments represent motor vehicles held for investment purposes and these amounts have been transferred from tangible fixed assets. They have been valued by reference to the valuations of similar vehicles.

18
Creditors: amounts falling due within one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
20
4,310,285
3,996,499
180,000
409,079
Obligations under finance leases
21
1,185,245
869,896
-
0
-
0
Trade creditors
4,561,358
3,729,113
-
0
-
0
Amounts owed to group undertakings
59,616
-
0
201,708
237,584
Other taxation and social security
430,063
1,388,961
-
-
Other creditors
373,761
283,821
142,433
131,433
Accruals and deferred income
190,617
151,814
13,750
11,750
11,110,945
10,420,104
537,891
789,846
19
Creditors: amounts falling due after more than one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
20
3,845,536
3,128,220
3,845,536
3,128,220
Obligations under finance leases
21
2,223,697
1,507,381
-
0
-
0
6,069,233
4,635,601
3,845,536
3,128,220
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 33 -
20
Loans and overdrafts
Group
Company
2022
2021
2022
2021
£
£
£
£
Bank loans
4,025,536
3,537,299
4,025,536
3,537,299
Bank overdrafts
4,130,285
3,587,420
-
0
-
0
8,155,821
7,124,719
4,025,536
3,537,299
Payable within one year
4,310,285
3,996,499
180,000
409,079
Payable after one year
3,845,536
3,128,220
3,845,536
3,128,220

The bank loans are secured on the freehold property Units 1 & 2 Juniper West Basildon, and Units C1 & C2 Bulwark Industrial Estate Chepstow.

The bank overdraft represents advances received under a factoring arrangement. These are secured by fixed and floating charges over the plant and fixtures.

The hire purchase balances are secured on the assets that the hire purchase is financing.

The advance on trade debtors is secured over the relevant trade debts.

21
Finance lease obligations
Group
Company
2022
2021
2022
2021
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
1,185,245
869,896
-
0
-
0
In two to five years
2,223,697
1,507,381
-
0
-
0
3,408,942
2,377,277
-
-

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is four years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 34 -
22
Deferred taxation

Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2022
2021
Group
£
£
Accelerated capital allowances
-
1,400
Revaluations
970,000
1,425,000
970,000
1,426,400
Liabilities
Liabilities
2022
2021
Company
£
£
Revaluations
970,000
1,425,000
Group
Company
2022
2022
Movements in the year:
£
£
Liability at 1 January 2022
1,426,400
1,425,000
Credit to profit or loss
(1,400)
-
Credit to other comprehensive income
(455,000)
(455,000)
Liability at 31 December 2022
970,000
970,000

Potential timing differences in the subsidiary have not resulted in a provision for deferred tax due to the fact that it is considered that no liability will arise due to ongoing research and development work that will attract tax credits.

23
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
158,438
153,785

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 35 -
24
Share capital
Group and company
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
6,278,000
6,278,000
6,278,000
6,278,000
25
Revaluation reserve
Group
Company
2022
2021
2022
2021
£
£
£
£
At the beginning of the year
4,326,982
424,185
4,326,982
424,185
Revaluation surplus arising in the year
(1,835,000)
5,227,797
(1,835,000)
5,227,797
Deferred tax on revaluation of tangible assets
-
(1,325,000)
-
(1,325,000)
Reversal of deferred tax liability on revaluation
455,000
-
455,000
-
At the end of the year
2,946,982
4,326,982
2,946,982
4,326,982
26
Profit and loss reserves
Group
Company
2022
2021
2022
2021
£
£
£
£
At the beginning of the year
491,408
97,981
1,166,476
954,875
Profit/(loss) for the year
(264,810)
413,427
37,133
231,601
Dividends
(110,000)
(20,000)
(110,000)
(20,000)
At the end of the year
116,598
491,408
1,093,609
1,166,476
WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 36 -
27
Operating lease commitments
Lessee

Operating lease payments represent rentals payable by the company for certain of its properties. Leases are negotiated for an average term of four years and rentals are fixed for an average of four years with leases relating to plant. Other leases, specifically relating to land and buildings often contain option to extend the lease following a break clause.

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2022
2021
2022
2021
£
£
£
£
Within one year
491,990
375,583
-
-
Between two and five years
491,990
300,000
-
-
In over five years
300,000
-
-
-
1,283,980
675,583
-
-
28
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2022
2021
£
£
Aggregate compensation
190,000
70,000

The key management are deemed to be K McGee and R Anderson.

Transactions with related parties

The group has taken advantage of the exemption not to disclose inter-group transactions where they are included within a consolidation.

 

During the year rent of £24,000 (2021 - £42,000) was paid to K N McGee.

 

The company rented office premises on a commercial basis at an annual rental of £40,000 (2021- £40,000) from a pension fund in which the directors have substantial interests.

 

Fees of £10,932 (2021 - £11,320) were paid to Azets Holdings Limited, a company of which R Anderson is a shareholder.

 

Dividends of £110,000 (2021 - £20,000) were paid to directors and participators during the year.

WCM INVESTMENTS LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 37 -
29
Audit exemption

Both CMA Moldform Limited and Kaidex Limited, subsidiary companies, have taken advantage of provisions under section 479a of the Companies Act 2006 to dispense with an audit of their individual accounts. The parent company has given a statement of guarantee in respect of both subsidiary companies for the year ended 31 December 2022.

30
Cash generated from/(absorbed by) group operations
2022
2021
£
£
(Loss)/profit for the year after tax
(264,810)
413,427
Adjustments for:
Taxation credited
(686,439)
(256,862)
Finance costs
362,539
279,824
Gain on disposal of tangible fixed assets
(56,227)
(9,874)
Amortisation and impairment of intangible assets
324,370
324,370
Depreciation and impairment of tangible fixed assets
1,043,687
1,101,622
Movements in working capital:
(Increase)/decrease in stocks
(207,614)
291,784
Decrease/(increase) in debtors
570,549
(2,196,576)
Increase/(decrease) in creditors
61,706
(1,069,765)
Cash generated from/(absorbed by) operations
1,147,761
(1,122,050)
31
Analysis of changes in net debt - group
1 January 2022
Cash flows
New finance leases
31 December 2022
£
£
£
£
Cash at bank and in hand
207,160
226,789
-
433,949
Bank overdrafts
(3,587,420)
(542,865)
-
(4,130,285)
(3,380,260)
(316,076)
-
(3,696,336)
Borrowings excluding overdrafts
(3,537,299)
(488,237)
-
(4,025,536)
Obligations under finance leases
(2,377,277)
1,502,282
(2,533,947)
(3,408,942)
(9,294,836)
697,969
(2,533,947)
(11,130,814)
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