Company registration number 05381795 (England and Wales)
SERVICE CARE SOLUTIONS LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
SERVICE CARE SOLUTIONS LTD
COMPANY INFORMATION
Directors
R M Freye
C Musgrove
Mr P Hurden
Company number
05381795
Registered office
Arthur House
12-13 Starkie Street
Preston
Lancashire
PR1 3LU
Auditor
Pierce C A Limited
Mentor House
Ainsworth Street
Blackburn
Lancashire
BB1 6AY
Business address
Arthur House
12-13 Starkie Street
Preston
Lancashire
PR1 3LU
Bankers
Barclays Bank plc
P O Box 2
38 Fishergate
Preston
Lancashire
PR1 2DD
SERVICE CARE SOLUTIONS LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 21
SERVICE CARE SOLUTIONS LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -
The directors present the strategic report for the year ended 31 March 2023.
Review of the business
The main activity of Service Care Solutions Ltd during the period is the supply of temporary and permanent workers across a range of specialist markets, including Health and Social Care, Housing, Construction, Criminal Justice, Legal and Finance.
Significant investment in our Technology Stack has delivered wholesale improvements to recruitment processes and supported the growth of our Managed Service Provider solution. Our growth model supports a proactive and targeted approach toward internal recruitment, which remains a priority for the business in a challenging market. We are very much a people focussed business and maintain a strong focus on staff welfare and routinely measure employee engagement. Robust compliance processes have been supplemented by technology improvements, embedding sustainable recruitment practices and enhancing our status as a trusted recruitment partner. Our ‘Cyber Resilience’ project work has been concluded, subject to continued monitoring and annual review, culminating in our cyber essentials plus accreditation.
The Directors are happy with the financial performance of the business, finishing the year ahead of our financial forecast. Turnover has increased to £49.4mn and GP to £7.6mn, 19% and 6% year on year increases respectively. Revenue generated from permanent placements has risen by 29%, reflective of a continued focus in this area.
Risk
Principal risks identified, reviewed and assessed are as follows:
Liquidity risk
We routinely review capital requirements to ensure sufficient liquidity is available to meet future needs. Liquidity risk is minimal. We have increased our reserves by £490,000 to £11,641,720 this year and have strong cash funds available.
Credit risk
Trade debtors represent our principal credit risk. Our credit checking procedures and risk assessment processes are robust. Routine review of trade debtors minimises the risk of bad debt and ensures provisions are made where required. Credit exposure is spread across a large customer base and supported by comprehensive credit insurance.
Interest rate risk
We do not have any borrowings, so we don’t foresee changes in interest rates having a material impact.
Performance monitoring
We proactively monitor and review our position against our operating ranges and ensure decisions made align with the intent that sits behind our growth model. Quarterly strategic reviews of Financial Management, Organisational Governance and Human Resources, as well as assessment against our operating ranges, continue to serve as a valuable measure of performance.
SERVICE CARE SOLUTIONS LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
C Musgrove
Director
21 November 2023
SERVICE CARE SOLUTIONS LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 March 2023.
Principal activities
The principal activity of the company continued to be that of a recruitment agency and recruitment business.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £335,106. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
R M Freye
C Musgrove
Mr P Hurden
Auditor
In accordance with the company's articles, a resolution proposing that Pierce C A Limited be reappointed as auditor of the company will be put at a General Meeting.
Statement of directors' responsibilities
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 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.
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 company’s auditor 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 company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
SERVICE CARE SOLUTIONS LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
On behalf of the board
C Musgrove
Director
21 November 2023
SERVICE CARE SOLUTIONS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SERVICE CARE SOLUTIONS LTD
- 5 -
Opinion
We have audited the financial statements of Service Care Solutions Ltd (the 'company') for the year ended 31 March 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the 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).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 March 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.
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 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.
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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
SERVICE CARE SOLUTIONS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SERVICE CARE SOLUTIONS LTD
- 6 -
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 directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, 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 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, 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 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.
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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
In identifying and assessing risks of material misstatement in respect of irregularities we considered the following:
The nature of the industry and the company’s control environment.
Results of our enquiries of management.
The company’s procedures and controls on compliance with laws and regulations and the risks of fraud.
Discussions among the audit engagement team concerning potential indicators of fraud.
We are also required to perform specific procedures to respond to the risk of management override.
As a result of our audit procedures we did not identify a material risk of fraud or other non-compliance with laws and regulations.
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.
SERVICE CARE SOLUTIONS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SERVICE CARE SOLUTIONS LTD
- 7 -
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.
James King (Senior Statutory Auditor)
For and on behalf of Pierce C A Limited
21 November 2023
Statutory Auditor
Mentor House
Ainsworth Street
Blackburn
Lancashire
BB1 6AY
SERVICE CARE SOLUTIONS LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
49,484,224
41,413,091
Cost of sales
(41,852,991)
(34,228,809)
Gross profit
7,631,233
7,184,282
Administrative expenses
(6,679,427)
(5,724,961)
Other operating income
50,526
Operating profit
4
1,002,332
1,459,321
Interest receivable and similar income
6
24,286
2,876
Amounts written off investments
7
(25,840)
(33,156)
Profit before taxation
1,000,778
1,429,041
Tax on profit
8
(175,965)
(299,107)
Profit for the financial year
824,813
1,129,934
The profit and loss account has been prepared on the basis that all operations are continuing operations.
SERVICE CARE SOLUTIONS LTD
BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
569,381
634,986
Investments
11
1,957,603
1,469,277
2,526,984
2,104,263
Current assets
Debtors
12
8,761,762
6,796,279
Cash at bank and in hand
2,516,318
4,250,240
11,278,080
11,046,519
Creditors: amounts falling due within one year
13
(2,094,910)
(1,927,713)
Net current assets
9,183,170
9,118,806
Total assets less current liabilities
11,710,154
11,223,069
Provisions for liabilities
Deferred tax liability
14
68,434
71,056
(68,434)
(71,056)
Net assets
11,641,720
11,152,013
Capital and reserves
Called up share capital
16
3,987
3,987
Profit and loss reserves
11,637,733
11,148,026
Total equity
11,641,720
11,152,013
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.true
The financial statements were approved by the board of directors and authorised for issue on 21 November 2023 and are signed on its behalf by:
C Musgrove
Director
Company registration number 05381795 (England and Wales)
SERVICE CARE SOLUTIONS LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2021
1,197
10,291,439
10,292,636
Year ended 31 March 2022:
Profit and total comprehensive income
-
1,129,934
1,129,934
Issue of share capital
16
2,790
-
2,790
Dividends
9
-
(273,347)
(273,347)
Balance at 31 March 2022
3,987
11,148,026
11,152,013
Year ended 31 March 2023:
Profit and total comprehensive income
-
824,813
824,813
Dividends
9
-
(335,106)
(335,106)
Balance at 31 March 2023
3,987
11,637,733
11,641,720
SERVICE CARE SOLUTIONS LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
19
(546,521)
1,513,236
Income taxes paid
(258,471)
(207,084)
Net cash (outflow)/inflow from operating activities
(804,992)
1,306,152
Investing activities
Purchase of tangible fixed assets
(103,944)
(110,110)
Proceeds on disposal of tangible fixed assets
1,300
Purchase of investments
(514,166)
(1,502,433)
Interest received
10,120
443
Dividends received
14,166
2,433
Net cash used in investing activities
(593,824)
(1,608,367)
Financing activities
Proceeds from issue of shares
2,790
Dividends paid
(335,106)
(273,347)
Net cash used in financing activities
(335,106)
(270,557)
Net decrease in cash and cash equivalents
(1,733,922)
(572,772)
Cash and cash equivalents at beginning of year
4,250,240
4,823,012
Cash and cash equivalents at end of year
2,516,318
4,250,240
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
1
Accounting policies
Company information
Service Care Solutions Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Arthur House, 12-13 Starkie Street, Preston, Lancashire, PR1 3LU.
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 on the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements the directors are not aware of any material uncertainties affecting the company and consider that the company will have sufficient resources to continue trading for the foreseeable future. As a result the directors have continued to adopt the going concern basis in preparing the financial statements.
1.3
Turnover
Turnover represents amounts receivable for services net of VAT and trade discounts. Revenue is recognised to reflect all candidates placed at customers up to the balance sheet date. The cost of placing candidates is similarly recognised as an expense to reflect all candidates placed at customers up to the balance sheet date.
1.4
Tangible fixed assets
Tangible fixed assets are measured at cost net of depreciation.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Land and buildings Leasehold
Over the lease term
Plant and machinery
40% straight line
Fixtures, fittings & equipment
10% - 40% straight line
Motor vehicles
5% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
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 company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 13 -
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
Investments in stocks, shares, and equivalent are recognised at their fair value as at the balance sheet date.
1.6
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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.
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 company 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.
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 14 -
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
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 company’s contractual obligations expire or are discharged or cancelled.
1.7
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.8
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred taxation is provided in full in respect of taxation deferred by timing difference between the treatment of certain items for taxation and accounting purposes. The deferred taxation balance has not been discounted.
1.9
Employee benefits
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
1.10
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.11
Leases
Rentals payable under operating leases are charged to income 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 lease asset are consumed.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Recruitment service
49,484,224
41,413,091
2023
2022
£
£
Other revenue
Interest income
10,120
443
Dividends received
14,166
2,433
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 16 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
11,000
10,000
Depreciation of owned tangible fixed assets
169,549
160,227
Operating lease charges
114,196
114,639
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Staff
99
88
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
4,180,824
3,698,746
Social security costs
458,488
388,579
Pension costs
132,705
112,206
4,772,017
4,199,531
6
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
9,685
360
Other interest income
435
83
Total interest revenue
10,120
443
Other income from investments
Dividends received
14,166
2,433
Total income
24,286
2,876
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 17 -
7
Amounts written off investments
2023
2022
£
£
Fair value gains/(losses) on financial instruments
Loss on financial assets held at fair value through profit or loss
(25,840)
(33,156)
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
221,473
278,420
Adjustments in respect of prior periods
(42,886)
Total current tax
178,587
278,420
Deferred tax
Origination and reversal of timing differences
(2,622)
20,687
Total tax charge
175,965
299,107
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
1,000,778
1,429,041
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
190,148
271,518
Tax effect of expenses that are not deductible in determining taxable profit
15,440
6,024
Permanent capital allowances in excess of depreciation
13,263
21,565
Research and development tax credit
(42,886)
Taxation charge for the year
175,965
299,107
9
Dividends
2023
2022
£
£
Interim paid
335,106
273,347
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
10
Tangible fixed assets
Land and buildings Leasehold
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2022
1,067,371
16,333
571,504
1,655,208
Additions
13,793
1,927
55,258
32,966
103,944
At 31 March 2023
1,081,164
18,260
626,762
32,966
1,759,152
Depreciation and impairment
At 1 April 2022
553,051
4,627
462,544
1,020,222
Depreciation charged in the year
107,336
1,687
59,839
687
169,549
At 31 March 2023
660,387
6,314
522,383
687
1,189,771
Carrying amount
At 31 March 2023
420,777
11,946
104,379
32,279
569,381
At 31 March 2022
514,320
11,706
108,960
634,986
11
Fixed asset investments
2023
2022
£
£
Investments
1,957,603
1,469,277
Movements in fixed asset investments
Investments
£
Cost or valuation
At 1 April 2022
1,469,277
Additions
514,166
Valuation changes
(25,840)
At 31 March 2023
1,957,603
Carrying amount
At 31 March 2023
1,957,603
At 31 March 2022
1,469,277
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 19 -
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
7,322,530
5,896,631
Other debtors
48,006
14,669
Prepayments and accrued income
1,391,226
884,979
8,761,762
6,796,279
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
111,106
109,090
Corporation tax
121,473
201,357
Other taxation and social security
468,937
440,269
Other creditors
219,553
Accruals and deferred income
1,393,394
957,444
2,094,910
1,927,713
14
Deferred taxation
Deferred tax assets and liabilities are offset where the 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
2023
2022
Balances:
£
£
Accelerated capital allowances
68,434
71,056
2023
Movements in the year:
£
Liability at 1 April 2022
71,056
Credit to profit or loss
(2,622)
Liability at 31 March 2023
68,434
The deferred tax liability set out above is expected to reverse within the foreseeable future and relates to accelerated capital allowances that are expected to mature within the same period.
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 20 -
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
132,705
112,206
The company operates defined contribution pension schemes for all qualifying employees. The assets of the schemes are held separately from those of the company in independently administered funds.
16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
'A' Ordinary shares of 0.1p each
1,080,000
1,080,000
1,080
1,080
'B' Ordinary shares of 0.1p each
27,000
27,000
27
27
'D' Ordinary shares of 3p each
3,000
3,000
90
90
'E' Ordinary shares of 3p each
93,000
93,000
2,790
2,790
1,203,000
1,203,000
3,987
3,987
17
Operating lease commitments
Lessee
At the reporting end date the company had total outstanding annual commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
83,530
82,900
Between two and five years
233,600
315,567
317,130
398,467
18
Ultimate controlling party
The company is under the control of the director, Mr R Freye, by virtue of his majority shareholding in the company.
SERVICE CARE SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 21 -
19
Cash (absorbed by)/generated from operations
2023
2022
£
£
Profit for the year after tax
824,813
1,129,934
Adjustments for:
Taxation charged
175,965
299,107
Investment income
(24,286)
(2,876)
Depreciation and impairment of tangible fixed assets
169,549
160,227
Other gains and losses
25,840
33,156
Movements in working capital:
Increase in debtors
(1,965,483)
(217,967)
Increase in creditors
247,081
111,655
Cash (absorbed by)/generated from operations
(546,521)
1,513,236
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