REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 APRIL 2023 |
FOR |
HUGH L S MCCONNELL LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 APRIL 2023 |
FOR |
HUGH L S MCCONNELL LIMITED |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 30 APRIL 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Statement of Income and Retained Earnings | 10 |
Balance Sheet | 11 |
Cash Flow Statement | 12 |
Notes to the Cash Flow Statement | 13 |
Notes to the Financial Statements | 14 |
HUGH L S MCCONNELL LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 30 APRIL 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditor |
37 Portland Road |
KILMARNOCK |
Ayrshire |
KA1 2DJ |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 30 APRIL 2023 |
The directors present their strategic report for the year ended 30 April 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the company are those of building & facility refurbishment and maintenance within the retail, commercial, residential, industrial and infrastructure sectors. |
REVIEW AND ANALYSIS OF THE BUSINESS |
We have delivered a solid year of growth in all aspects of the business. Revenue has increased from £25m (FY22) to £35m; Operating Profit from £1m (FY22) to £1.5m; and our year end cash position improved from £2m (FY22) to £3.8m. |
Significant value long-term contracts were secured during the year, and we go into FY24 with a strong order book and large addressable pipeline of opportunities. Our customer base has been broadened significantly, particularly in London and the Southeast of England. |
A major investment was made in our IT infrastructure with integration of new ERP software achieved in Q4, and continued major investment was made in progressively converting our fleet to EV and PHEV vehicles. |
Total capital investment was £1.1m. |
The Directors are very pleased with the overall performance of the business in FY23 and would again like to thank all employees, supply chain partners, advisors, and customers for their support, commitment, and loyalty. |
OPERATIONAL RISKS AND UNCERTAINTIES |
Operational Risk |
The key operational risk is the management of higher value projects. The risk is mitigated by our continued investment in the management team, recruiting capable managers with relevant experience; our certified quality control procedures; and targeting projects that are comfortably within our leadership and management skill set, focussing on our core business and not overly diversifying. |
Financial Risk |
The global economy is under strain and the UK continues to be affected by rising interest rates, high inflation, rising costs, and political and economic uncertainty. The construction industry is being affected by all these factors. |
McConnell continues to grow and strengthen without experiencing any material bad debt or credit encumbrances. We adopt a cautious approach to accounts provisioning, acknowledging the risks that exist within the construction sector. |
The principal financial risk to the business is credit based. The possibility of a customer experiencing solvency issues during a significant project is the main exposure the business faces. This risk has been mitigated by continued diligent credit risk analysis prior to contractual commitment. All significant projects with customers who are not government or publicly funded are credit risk assessed. Our customer base consists of government & publicly funded organisations, and blue chip private and infrastructure clients. |
Our liquidity risk is mitigated by daily cashflow monitoring. Senior management are provided with real-time cashflow projections to ensure that we have sufficient liquidity to meet all our commitments. An experienced Finance Director and capable Commercial team oversee cash management and commercial performance. During FY23 we reduced our CBILS loan by £170k to £510k, |
We negotiate contracts to share the risk of rising costs and protect McConnell from having to absorb unexpected cost increases where they are not within our control. We also negotiate contracts to remove unfair risks and we avoid customers that have unreasonable expectations in that regard. |
We believe McConnell is well placed to continue to effectively manage risk and capitalise on the opportunities that are materialising from increased funding entering the sectors that we operate in. We have a strong order book and opportunities pipeline for FY24 and look forward to another positive year in the development of the business. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 30 APRIL 2023 |
ON BEHALF OF THE BOARD: |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 30 APRIL 2023 |
The directors present their report with the financial statements of the company for the year ended 30 April 2023. |
PRINCIPAL ACTIVITIES |
The principal activities of the company in the year under review were those of building & facility refurbishment and maintenance within the retail, commercial, residential, industrial and infrastructure sectors. |
DIVIDENDS |
The total distribution of dividends for the year ended 30 April 2023 was £164,000 (2022: £156,100). |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 May 2022 to the date of this report. |
FINANCIAL INSTRUMENTS |
Interest rate risk |
The company manages its cash and borrowing requirements to minimise interest expense whilst ensuring that it has sufficient liquid resources to meet the operating needs of the business. The company is exposed to increased interest costs should bank base rates increase. |
Credit risk |
All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors' balances are monitored on an ongoing basis and provision is made for doubtful debts where necessary. |
The company's bank deposits are held by banks with high credit ratings assigned by international credit rating agencies. |
DIRECTORS' RESPONSIBILITIES STATEMENT |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 30 APRIL 2023 |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
The auditors, Gilmour Hamilton, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
HUGH L S MCCONNELL LIMITED |
Opinion |
We have audited the financial statements of Hugh L S McConnell Limited (the 'company') for the year ended 30 April 2023 which comprise the Statement of Income and Retained Earnings, Balance Sheet, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of 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). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 30 April 2023 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
HUGH L S MCCONNELL LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Directors' Responsibilities Statement set out on page four, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
HUGH L S MCCONNELL LIMITED |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. A summary of the procedures we designed and executed to detect irregularities, including fraud is set out below: |
- performing analytical procedures to identify unusual or unexpected relationships that may indicate |
risks of material misstatement due to fraud and tested accordingly; |
- reviewing correspondence with regulatory bodies, such as HMRC, and reviewing documentation |
for indications of non-compliance with laws and regulations; |
- determining whether the accounting policies, treatments and presentation adopted in the financial |
statements is in accordance with 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); |
- identifying whether there are instances of potential bias in areas with significant degrees of |
judgement such as amounts recoverable on contracts; |
- in addressing the risk of fraud through management override of controls, testing the appropriateness |
of journal entries and other adjustments; assessing whether the judgements made in making |
accounting estimates are indicative of a potential bias; and evaluating the business rationale of any |
significant transactions that are unusual or outside the normal course of business; |
- in addressing the risk of fraud in revenue recognition obtaining an understanding of the controls |
in place and where possible testing the operating effectiveness of those controls. Substantive tests |
were executed to supplement testing of controls; |
- vouching balances and reconciling items in management's key control account reconciliations to |
supporting documentation as at 30 April 2023; and |
- carrying out detailed testing, on a sample basis, of material transactions, financial statement |
categories and balances to appropriate documentary evidence to verify the completeness, |
occurrence and accuracy of the reported financial statements. |
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, misrepresentation 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, or the greater the concealment of irregularities, including fraud, the less likely we are to become aware of it. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
HUGH L S MCCONNELL LIMITED |
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 a Report of the Auditors 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. |
for and on behalf of |
Statutory Auditor |
37 Portland Road |
KILMARNOCK |
Ayrshire |
KA1 2DJ |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
STATEMENT OF INCOME AND RETAINED EARNINGS |
FOR THE YEAR ENDED 30 APRIL 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
TURNOVER | 3 |
Other operating income |
34,689,507 | 25,033,247 |
Raw materials and consumables |
Other external expenses |
24,341,767 | 17,885,352 |
10,347,740 | 7,147,895 |
Staff costs | 4 |
Depreciation |
Other operating expenses |
8,848,333 | 6,132,557 |
OPERATING PROFIT | 5 |
Interest payable and similar expenses | 6 |
PROFIT BEFORE TAXATION |
Tax on profit | 7 |
PROFIT FOR THE FINANCIAL YEAR |
Retained earnings at beginning of year |
Dividends | 8 | ( |
) | ( |
) |
RETAINED EARNINGS AT END OF YEAR |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
BALANCE SHEET |
30 APRIL 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 9 |
Tangible assets | 10 |
Investments | 11 |
CURRENT ASSETS |
Stocks | 12 |
Debtors | 13 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 14 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
15 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | 20 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 21 |
Retained earnings | 22 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
CASH FLOW STATEMENT |
FOR THE YEAR ENDED 30 APRIL 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
( |
) |
Tax paid |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
New hire purchase agreement |
Amount advanced by group undertakings | 95,920 | - |
Hire purchase repayments in year | ( |
) | ( |
) |
Loan repayments in the year | ( |
) | ( |
) |
Equity dividends paid | ( |
) | ( |
) |
Net cash from financing activities | ( |
) |
Increase/(decrease) in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
2,038,619 |
Cash and cash equivalents at end of year |
2 |
3,834,722 |
2,011,533 |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE CASH FLOW STATEMENT |
FOR THE YEAR ENDED 30 APRIL 2023 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
£ | £ |
Profit before taxation |
Depreciation charges |
(Profit)/loss on disposal of fixed assets | ( |
) |
Finance costs | 49,119 | 30,682 |
1,724,372 | 1,146,213 |
Increase in trade and other debtors | ( |
) | ( |
) |
Increase in trade and other creditors |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 30 April 2023 |
30.4.23 | 1.5.22 |
£ | £ |
Cash and cash equivalents | 3,834,722 | 2,011,533 |
Year ended 30 April 2022 |
30.4.22 | 1.5.21 |
£ | £ |
Cash and cash equivalents | 2,011,533 | 2,038,619 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.5.22 | Cash flow | At 30.4.23 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 2,011,533 | 1,823,189 | 3,834,722 |
2,011,533 | 3,834,722 |
Debt |
Finance leases | (93,193 | ) | (652,237 | ) | (745,430 | ) |
Debts falling due within 1 year | (170,000 | ) | - | (170,000 | ) |
Debts falling due after 1 year | (510,000 | ) | 170,000 | (340,000 | ) |
(773,193 | ) | (482,237 | ) | (1,255,430 | ) |
Total | 1,238,340 | 1,340,952 | 2,579,292 |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 30 APRIL 2023 |
1. | STATUTORY INFORMATION |
Hugh L S McConnell Limited is a |
2. | ACCOUNTING POLICIES |
General information and basis of preparation |
The financial statements have been prepared in pounds sterling which is the functional currency of the company and rounded to the nearest pound. |
The significant accounting policies applied in the preparation of these financial statements are set out below. |
Preparation of consolidated financial statements |
The financial statements contain information about Hugh L S McConnell Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 400 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertaking are included by full consolidation in the consolidated financial statements of its parent, McConnell Group Limited, United Kingdom. |
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. |
Critical accounting judgements and key sources of estimation uncertainty |
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported as assets, liabilities, revenues and expenses for the year. The key sources of estimation uncertainty are as follows: |
Depreciation and amortisation of tangible and intangible fixed assets |
Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The expected lives of assets and their residual values are assessed regularly and may vary depending on a number of factors including asset life cycles, maintenance programmes etc. |
Impairment of assets |
Tangible fixed assets, intangible fixed assets, fixed asset investments, stock and debtors are all reviewed for evidence of impairment. |
In connection with fixed assets (tangible, intangible and investments) factors taken into consideration include the economic viability and the expected future financial performance of the assets. |
Trade debtors are reviewed for evidence of impairment. Factors considered include ageing, past recovery rates, customer creditworthiness, and the stage and expected outcome of any recovery proceedings. |
Contract accounting |
When determining the amount to include as amounts recoverable on contracts and thereby the amount of profit to recognise on individual contracts, factors such as the stage of completion and forecasted outturn of the contract are taken into account. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is measured at the fair value of consideration received net of VAT. The policy adopted for the recognition of turnover are as follows: |
Construction contracts |
When the outcome of a construction contract can be estimated reliably, contract costs and turnover are recognised by reference to the stage of completion at the balance sheet date. Stage of completion is measured by reference to agreed valuations, current and projected contract costs and expected sales value. |
Where the outcome cannot be measured reliably, contract costs are recognised as an expense in the period in which they are incurred and contract turnover is recognised to the extent of costs incurred that it is probable will be recoverable. |
When it is probable that contract costs will exceed the total contract turnover, the expected loss is recognised as an expense immediately, with a corresponding provision. |
Goodwill |
The company has elected not to restate any business combinations which took place prior to the transition to FRS102. Goodwill therefore includes other intangible assets (such as customer lists) which were acquired prior to the transition date. |
Goodwill is measured at cost less accumulated amortisation and any accumulated impairment losses. It has been amortised evenly over its estimated useful life of twenty years. |
Tangible fixed assets |
Plant and machinery | - |
Fixtures and fittings | - |
Motor vehicles | - |
Investments in subsidiaries |
Investments in subsidiary undertakings are recognised at cost less any provision for impairment. |
Stocks |
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the first-in, first-out formula. Provision is made for damaged, obsolete and slow-moving stock where appropriate. |
Taxation |
Current tax represents the amount of tax payable or receivable in respect of the taxable profit (or loss) for the current or past reporting periods. It is measured at the amount expected to be paid or recovered using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax represents the future tax consequences of transactions and events recognised in the financial statements of current and previous periods. It is recognised in respect of all timing differences, with certain exceptions. Timing differences are differences between taxable profits and total comprehensive income as stated in the financial statements that arise from the inclusion of income and expense in tax assessments in periods different from those in which they are recognised in the financial statements. 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. |
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date that are expected to apply to the reversal of timing differences. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
2. | ACCOUNTING POLICIES - continued |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability. |
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 makes payments to defined contribution pension schemes on behalf of employees. The assets of the schemes are held separately from those of the company in independently administered funds. Contributions payable for the year are charged in the profit and loss account. |
Employee benefits |
When employees have rendered service to the company, short term benefits (including holiday pay) to which employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service. |
Government grants |
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the company will comply with conditions attaching to them and the grants will be received using the accrual model. |
Financial instruments |
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other external charges. |
Cash on the balance sheet comprises cash in hand and cash at bank. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the principal activities of the company. |
An analysis of turnover by class of business is given below: |
2023 | 2022 |
£ | £ |
An analysis of turnover by geographical market is given below: |
2023 | 2022 |
£ | £ |
United Kingdom |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Directors | 5 | 3 |
Supervisory, sales and admin | 70 | 49 |
Production | 46 | 37 |
2023 | 2022 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
Compensation to director for loss of office |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Information regarding the highest paid director is as follows: |
2023 | 2022 |
£ | £ |
Emoluments etc |
Pension contributions to money purchase schemes |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2023 | 2022 |
£ | £ |
Hire of equipment |
Operating leases |
Depreciation - owned assets |
Depreciation - assets on hire purchase contracts |
(Profit)/loss on disposal of fixed assets | ( |
) |
Auditors' remuneration |
Government and other grants | ( |
) | ( |
) |
Cost of stock recognised as an expense |
Impairment of debtors |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Bank loan interest |
HMRC interest |
Hire purchase |
7. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax |
Prior years | (83,306 | ) | - |
Total current tax |
Deferred tax - origination and reversal of timing differences |
Tax on profit |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Depreciation in excess of capital allowances |
Utilisation of tax losses | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) |
Group relief | (11,636 | ) | (29,621 | ) |
Super deduction | (20,544 | ) | (8,128 | ) |
Change in tax rate | 41,470 | 4,040 |
Total tax charge | 220,728 | 116,430 |
Factors that may affect future tax charges |
The UK Corporation tax rate from 19% to 25% on 1 April 2023. The effective rate of corporation tax for the period is therefore 19.493%. The increased rate will impact the company's future tax charge accordingly. The value of the deferred tax liability at the balance sheet date has been calculated using the applicable rate when the liability is expected to be realised. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
8. | DIVIDENDS |
2023 | 2022 |
£ | £ |
Interim |
9. | INTANGIBLE FIXED ASSETS |
Goodwill |
£ |
COST |
At 1 May 2022 |
and 30 April 2023 |
AMORTISATION |
At 1 May 2022 |
and 30 April 2023 |
NET BOOK VALUE |
At 30 April 2023 |
At 30 April 2022 |
10. | TANGIBLE FIXED ASSETS |
Fixtures |
Plant and | and | Motor |
machinery | fittings | vehicles | Totals |
£ | £ | £ | £ |
COST |
At 1 May 2022 |
Additions |
Disposals | ( |
) | ( |
) |
At 30 April 2023 |
DEPRECIATION |
At 1 May 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 30 April 2023 |
NET BOOK VALUE |
At 30 April 2023 |
At 30 April 2022 |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
10. | TANGIBLE FIXED ASSETS - continued |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Motor |
vehicles |
£ |
COST |
At 1 May 2022 |
Additions |
Disposals | ( |
) |
Transfer to ownership | (188,866 | ) |
At 30 April 2023 |
DEPRECIATION |
At 1 May 2022 |
Charge for year |
Eliminated on disposal | ( |
) |
Transfer to ownership | (184,770 | ) |
At 30 April 2023 |
NET BOOK VALUE |
At 30 April 2023 |
At 30 April 2022 |
11. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertakings |
£ |
COST |
At 1 May 2022 |
and 30 April 2023 |
PROVISIONS |
At 1 May 2022 |
and 30 April 2023 | 875,514 |
NET BOOK VALUE |
At 30 April 2023 |
At 30 April 2022 |
The company's investments at the Balance Sheet date in the share capital of companies include the following: |
Registered office: United Kingdom |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
£ | £ |
Aggregate capital and reserves |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
11. | FIXED ASSET INVESTMENTS - continued |
Registered office: United KIngdom |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
£ | £ |
Aggregate capital and reserves |
Registered office: United Kingdom |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
£ | £ |
Aggregate capital and reserves |
Registered office: United Kingdom |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
£ | £ |
Aggregate capital and reserves |
12. | STOCKS |
2023 | 2022 |
£ | £ |
Raw materials and consumables |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade debtors |
Amounts recoverable on contracts |
Prepayments |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Bank loans and overdrafts (see note 16) |
Hire purchase contracts (see note 17) |
Payments on account |
Trade creditors |
Amounts owed to group undertakings |
Tax |
Social security and other taxes |
Accrued expenses |
Included in Creditors: amounts falling due within one year is £27,788 (2022: £35,402) in respect of pension payments. |
15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2023 | 2022 |
£ | £ |
Bank loans (see note 16) |
Hire purchase contracts (see note 17) |
Amounts owed to group undertakings |
16. | LOANS |
An analysis of the maturity of loans is given below: |
2023 | 2022 |
£ | £ |
Amounts falling due within one year or on demand: |
Business interruption loan | 170,000 | 170,000 |
Amounts falling due between one and two years: |
Business interruption loan |
Amounts falling due between two and five years: |
Business interruption loan |
The business interruption loan is repayable in 60 equal monthly instalments commencing May 2021. Interest is at 3.37% above base rate, with the first year's interest met by the government under the Coronavirus Business Interruption Loan Scheme. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
2023 | 2022 |
£ | £ |
Gross obligations repayable: |
Within one year |
Between one and five years |
Finance charges repayable: |
Within one year |
Between one and five years |
Net obligations repayable: |
Within one year |
Between one and five years |
Non-cancellable | operating leases |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
18. | SECURED DEBTS |
The following secured debts are included within creditors: |
2023 | 2022 |
£ | £ |
Hire purchase contracts | 745,430 | 93,193 |
Business interruption loan | 510,000 | 680,000 |
Hire purchase liabilities are secured over the particular assets. |
The business interruption loan is secured by a bond and floating charge over the company's assets and by a government guarantee. |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
19. | FINANCIAL INSTRUMENTS |
The carrying amount of the company's financial instruments are as follows: |
2023 | 2022 |
£ | £ |
Financial assets |
Debt instruments measured at amortised cost |
Cash at bank and in hand | 3,834,723 | 2,011,534 |
Trade and other debtors | 7,848,958 | 6,648,710 |
Equity instruments measured at cost less impairment |
Fixed asset unlisted in subsidiary undertakings | 32,004 | 32,004 |
Financial liabilities |
Measured at amortised cost |
Trade creditors | 1,364,238 | 1,767,891 |
Accrued expenses | 3,422,942 | 2,980,290 |
Amounts owed to group undertakings | 127,920 | 32,000 |
Hire purchase liabilities | 745,430 | 93,193 |
Bank loans | 510,000 | 680,000 |
20. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
£ | £ |
Deferred tax |
Accelerated capital allowances | 231,546 | 42,545 |
Other timing differences | (3,678 | ) | (2,939 | ) |
227,868 | 39,606 |
Deferred |
tax |
£ |
Balance at 1 May 2022 |
Charged to statement of income | 188,262 |
Balance at 30 April 2023 |
21. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary shares | £1 | 75,000 | 75,000 |
HUGH L S MCCONNELL LIMITED (REGISTERED NUMBER: SC191842) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 30 APRIL 2023 |
22. | RESERVES |
Retained |
earnings |
£ |
At 1 May 2022 |
Profit for the year |
Dividends | ( |
) |
At 30 April 2023 |
Retained earnings |
Retained earnings represents cumulative profits and losses net of dividends and other adjustments. |
23. | CONTINGENT LIABILITIES |
On completion of some of its roofing contracts, the company provides a written guarantee for its works. Under the terms of the guarantees, which mostly last for ten years, the company is required to make good any defects which appear in its work during the guarantee period. |
This guarantee system has been in place for over ten years and, in general, only minor repairs (if any ) have been required. Since any estimate of the future costs of these minor repairs would be wholly subjective, no provision is made for them in the accounts and their cost is charged to the profit and loss account in the year in which they occur. If however any substantial post year end repairs are identified, the cost of such repairs would be accrued in the accounts. |
24. | CAPITAL COMMITMENTS |
2023 | 2022 |
£ | £ |
Contracted but not provided for in the |
financial statements |
25. | RELATED PARTY DISCLOSURES |
The company has granted security over its assets in connection with group borrowings. |
The company's immediate and ultimate parent company is McConnell Group Limited, registered in the United Kingdom, which is controlled by its directors. |