Company registration number 01497223 (England and Wales)
RICHARDSON ROOFING COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2023
RICHARDSON ROOFING COMPANY LIMITED
COMPANY INFORMATION
Directors
G M Richardson
S D Wright
E Disha
(Appointed 1 January 2024)
Secretary
D Willmont
Company number
01497223
Registered office
Richardson House
Moor Lane
Staines
Middlesex
TW19 6EQ
Auditor
Goodman Jones LLP
29/30 Fitzroy Square
London
W1T 6LQ
RICHARDSON ROOFING COMPANY LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 23
RICHARDSON ROOFING COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2023
- 1 -

The directors present the strategic report for the year ended 31 August 2023.

Review of the business
The directors are satisfied with the results for the year.

For a full review of the group performance please see the financial statements of the ultimate parent company, Richardson Roofing Holdings Limited.

Financial Instruments and risk

The company uses financial instruments comprising borrowings and various net working capital items such as trade debtors and trade creditors, to finance its operations not funded by way of equity. The main risks identified with using these financial instruments are the management of cash flow and exposure to interest rate fluctuations. The company mitigates this risk by managing cash flow and negotiating credit facilities to assist with liquidity as required.

 

Going concern

In determining the appropriate basis of preparation of the Financial Statements, the directors are required to consider whether the company can continue in operational existence for the foreseeable future.

 

The company's forecasts and projections, taking account of possible changes in trading performance, show that the company will be able to operate within the level of its current cash balances.

 

Accordingly, the directors continue to adopt the going concern basis in preparing the financial statements. At the time of approving the financial statements, the directors expect that the company 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.

Key performance indicators

 

 

2023 2022

 

Turnover          £17,520k £19,120k

 

Operating Profit/(Loss)          £547k £(2,976)k

 

Operating Profit/(Loss) %          3%          (16)%

 

Profit/(Loss) before tax          £536k £(439)k

 

On behalf of the board

G M Richardson
Director
25 January 2024
RICHARDSON ROOFING COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 AUGUST 2023
- 2 -

The directors present their annual report and financial statements for the year ended 31 August 2023.

Principal activities
The principal activity of the company is that of roofing contractors.
Results and dividends

The results for the year are set out on page 7.

No ordinary dividend was paid during the year (2022: £Nil).

Directors

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

G M Richardson
S D Wright
P J MacSweeney
(Resigned 31 December 2023)
E Disha
(Appointed 1 January 2024)
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Research and development

The company is one of the industry leaders specialising in traditional and modern commercial roofing techniques.  In certain projects, the company carries out research and development activities to seek scientific and technological advancements to be able to complete complex solutions that were previously unattainable.

 

Auditor

The auditor, Goodman Jones LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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:

 

 

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.

RICHARDSON ROOFING COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 3 -
Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial instruments, risk and going concern.

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.

On behalf of the board
G M Richardson
Director
25 January 2024
RICHARDSON ROOFING COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF RICHARDSON ROOFING COMPANY LIMITED
- 4 -
Opinion

We have audited the financial statements of Richardson Roofing Company Limited (the 'company') for the year ended 31 August 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity 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:

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 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 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:

RICHARDSON ROOFING COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF RICHARDSON ROOFING COMPANY LIMITED
- 5 -
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:

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.

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.

Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to industry sector regulations and unethical and prohibited business practices, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and UK Tax Legislation. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls). Appropriate audit procedures in response to these risks were carried out. These procedures included:

 

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members; and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

There are inherent limitations in the audit procedures described above. The further removed instances of non-compliance with laws and regulations are from the events and transactions reflected in the financial statements, the less likely we are to become aware of it. Also, 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 or intentional misrepresentations, or through collusion.

RICHARDSON ROOFING COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF RICHARDSON ROOFING COMPANY LIMITED
- 6 -

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.

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.

Matthew Cook
Senior Statutory Auditor
For and on behalf of Goodman Jones LLP
25 January 2024
Chartered Accountants
Statutory Auditor
29/30 Fitzroy Square
London
W1T 6LQ
RICHARDSON ROOFING COMPANY LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 AUGUST 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
17,519,718
19,120,334
Cost of sales
(14,627,475)
(18,886,931)
Gross profit
2,892,243
233,403
Administrative expenses
(2,345,516)
(3,209,342)
Operating profit/(loss)
4
546,727
(2,975,939)
Interest receivable and similar income
7
1,856
-
0
Interest payable and similar expenses
8
(12,567)
(12,679)
Release of intercompany indebtedness
-
0
2,550,000
Profit/(loss) before taxation
536,016
(438,618)
Tax on profit/(loss)
9
157,760
186,259
Profit/(loss) for the financial year
693,776
(252,359)

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

RICHARDSON ROOFING COMPANY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2023
- 8 -
2023
2022
£
£
Profit/(loss) for the year
693,776
(252,359)
Other comprehensive income
-
-
Total comprehensive income for the year
693,776
(252,359)
RICHARDSON ROOFING COMPANY LIMITED
BALANCE SHEET
AS AT
31 AUGUST 2023
31 August 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
79,114
154,115
Current assets
Stocks
11
249,409
199,977
Debtors
12
6,007,955
9,892,305
Cash at bank and in hand
335,902
1,017,968
6,593,266
11,110,250
Creditors: amounts falling due within one year
13
(4,639,127)
(9,924,888)
Net current assets
1,954,139
1,185,362
Net assets
2,033,253
1,339,477
Capital and reserves
Called up share capital
17
100,000
100,000
Profit and loss reserves
1,933,253
1,239,477
Total equity
2,033,253
1,339,477

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 25 January 2024 and are signed on its behalf by:
G M Richardson
S D Wright
Director
Director
Company registration number 01497223 (England and Wales)
RICHARDSON ROOFING COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2023
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 September 2021
100,000
1,491,836
1,591,836
Year ended 31 August 2022:
Loss and total comprehensive income
-
(252,359)
(252,359)
Balance at 31 August 2022
100,000
1,239,477
1,339,477
Year ended 31 August 2023:
Profit and total comprehensive income
-
693,776
693,776
Balance at 31 August 2023
100,000
1,933,253
2,033,253
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2023
- 11 -
1
Accounting policies
Company information

Richardson Roofing Company Limited is a private company limited by shares incorporated in England and Wales. The registered office is Richardson House, Moor Lane, Staines, Middlesex, TW19 6EQ.

1.1
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention,. The principal accounting policies adopted are set out below.

This 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:

 

 

The financial statements of the company are consolidated in the financial statements of Richardson Roofing Holdings Limited. These consolidated financial statements are available from its registered office, Richardson House, Moor Lane, Staines, Middlesex, TW19 6EQ.

1.2
Going concern

In determining the appropriate basis of preparation of the Financial Statements, the directors are required to consider whether the company can continue in operational existence for the foreseeable future.true

 

The company's forecasts and projections, taking account of possible changes in trading performance, show that the company will be able to operate within the level of its current cash balances.

 

Accordingly, the directors continue to adopt the going concern basis in preparing the financial statements. At the time of approving the financial statements, the directors expect that the company 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.

1.3
Turnover

Turnover comprises the value of the contracting work executed during the year and the invoiced value of other sales net of VAT.

 

See also accounting policy 1.15 for details of how turnover is calculated with regard to long term construction contracts.

RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 12 -
1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and machinery
20%  Straight line
Fixtures, fittings & computer equipment
10% & 25% Straight line
Motor vehicles
25%  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
Impairment of fixed assets

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

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 13 -
1.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.8
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

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

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.

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.

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.

RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 14 -
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.

 

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 though 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.

1.9
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.10
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

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

 

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

RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 15 -
1.11
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.12
Retirement benefits
Pension contributions are charged to the profit and loss account as incurred. These contributions are invested separately from the company's assets.
1.13
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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 leases asset are consumed.

1.14
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.

 

RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 16 -
1.15

Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

 

Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the statement of comprehensive income turnover and related costs as contract activity progresses. Turnover is calculated as that proportion of total contract value which costs to date bear to total expected costs for that contract. Full provision is made for losses on all contracts in the year in which they are first foreseen.

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.

 

Amounts recoverable on long term contracts

 

The company applies its policy on contract accounting when recognising revenue and profit on partially completed contracts. The application of this policy requires judgements to be made in respect of the total expected costs to complete for each site. The company has in place established internal control processes to ensure that the evaluation of costs and revenues is based upon appropriate estimates. Amounts recoverable on long term contracts recognised at the year end total £3,699,227 (2022: £5,438,717), with payments received on account recognised in creditors at £1,142,278 (2022: £1,500,159).

3
Turnover and other revenue

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

2023
2022
£
£
Turnover analysed by class of business
Roofing services
17,519,718
19,120,334
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
3
Turnover and other revenue
(Continued)
- 17 -
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
17,519,718
19,120,334
2023
2022
£
£
Other revenue
Interest income
1,856
-
4
Operating profit/(loss)
2023
2022
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
25,000
23,350
Depreciation of owned tangible fixed assets
26,865
32,067
Depreciation of tangible fixed assets held under finance leases
54,752
74,178
Profit on disposal of tangible fixed assets
(667)
(4,183)
Operating lease charges
295,000
201,000
5
Employees

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

2023
2022
Number
Number
Administration
43
45
Contract sales and labour
7
5
Total
50
50

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,615,867
2,413,358
Social security costs
335,718
310,565
Pension costs
47,947
46,799
2,999,532
2,770,722
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 18 -
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
411,294
341,900
Company pension contributions to defined contribution schemes
3,963
3,963
415,257
345,863

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022: 3).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
140,847
138,218
Company pension contributions to defined contribution schemes
1,321
1,321
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
1,224
-
0
Other interest income
632
-
0
Total income
1,856
-
0
8
Interest payable and similar expenses
2023
2022
£
£
Interest on finance leases and hire purchase contracts
12,567
12,679
9
Taxation
2023
2022
£
£
Current tax
Adjustments in respect of prior periods
(142,942)
(171,497)
Deferred tax
Origination and reversal of timing differences
(14,818)
(14,762)
Total tax credit
(157,760)
(186,259)
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
9
Taxation
(Continued)
- 19 -

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

2023
2022
£
£
Profit/(loss) before taxation
536,016
(438,618)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
134,004
(83,337)
Tax effect of expenses that are not deductible in determining taxable profit
(650)
13,221
Tax effect of income not taxable in determining taxable profit
(167)
(499,263)
Tax effect of utilisation of tax losses brought forward
(128,493)
-
0
Unutilised tax losses carried forward
-
0
554,617
Adjustments in respect of prior years
(142,942)
(171,497)
Effect of change in corporation tax rate
(19,512)
-
0
Taxation credit for the year
(157,760)
(186,259)
10
Tangible fixed assets
Plant and machinery
Fixtures, fittings & computer equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 September 2022
29,694
194,065
1,013,367
1,237,126
Additions
990
5,626
-
0
6,616
Disposals
-
0
(8,583)
(28,325)
(36,908)
At 31 August 2023
30,684
191,108
985,042
1,206,834
Depreciation and impairment
At 1 September 2022
29,694
137,814
915,503
1,083,011
Depreciation charged in the year
50
26,816
54,751
81,617
Eliminated in respect of disposals
-
0
(8,583)
(28,325)
(36,908)
At 31 August 2023
29,744
156,047
941,929
1,127,720
Carrying amount
At 31 August 2023
940
35,061
43,113
79,114
At 31 August 2022
-
0
56,251
97,864
154,115
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
10
Tangible fixed assets
(Continued)
- 20 -

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

2023
2022
£
£
Motor vehicles
43,113
96,864
11
Stocks
2023
2022
£
£
Raw materials and consumables
249,409
199,977
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,532,851
1,035,449
Gross amounts owed by contract customers
3,699,227
5,438,717
Corporation tax recoverable
-
0
309,048
Other debtors
213,249
2,097,732
Prepayments and accrued income
126,812
123,162
5,572,139
9,004,108
2023
2022
Amounts falling due after more than one year:
£
£
Trade debtors
417,714
884,913
Deferred tax asset (note 15)
18,102
3,284
435,816
888,197
Total debtors
6,007,955
9,892,305
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 21 -
13
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Obligations under finance leases
14
-
0
18,845
Payments received on account
1,142,278
1,500,159
Trade creditors
1,875,279
1,952,646
Amounts owed to group undertakings
1,013,560
5,001,000
Taxation and social security
116,945
100,169
Other creditors
177,131
1,234,687
Accruals and deferred income
313,934
117,382
4,639,127
9,924,888
14
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
-
0
19,598
Less: future finance charges
-
0
(753)
-
0
18,845
15
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:

Assets
Assets
2023
2022
Balances:
£
£
Accelerated capital allowances
18,102
3,284
2023
Movements in the year:
£
Asset at 1 September 2022
(3,284)
Credit to profit or loss
(14,818)
Asset at 31 August 2023
(18,102)
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 22 -
16
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
47,947
46,799

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

17
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100,000
100,000
100,000
100,000

The company has one class of ordinary shares which carry no right to fixed income.

18
Operating lease commitments
Lessee

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

2023
2022
£
£
Within one year
195,000
195,000
Between two and five years
735,000
750,000
In over five years
360,000
540,000
1,290,000
1,485,000
19
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
Entites under common control
3,197,162
570,284
2,387,764
3,072,584
Management fees/Rent
Rent charges
2023
2022
2023
2022
£
£
£
£
Entites under common control
2,204,915
531,780
295,000
195,000
RICHARDSON ROOFING COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
19
Related party transactions
(Continued)
- 23 -

The entity has taken the exemption in line with FRS 102 paragraph 33.1A not to disclose transactions with other entities wholly owned by the same parent entity.

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£
£
Entites under common control
1,602
1,377,810
Other information

The total remuneration for key management personnel for the year totalled £415,257 (2022 - £345,863).

 

At the year end, the directors were owed £22,381 (2022: £20,279) by the company. This loan is unsecured and interest free.

 

20
Ultimate controlling party

The company is under the control of G.M. Richardson who owns 100% of the share capital of the parent company.

 

The ultimate parent company is Richardson Roofing Holdings Limited, a company incorporated in the United Kingdom.

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