Company Registration No. 05385561 (England and Wales)
KDH PROJECTS LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2023
1-4 London Road
Spalding
Lincolnshire
PE11 2TA
KDH PROJECTS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Director's report
3
Director's responsibilities statement
4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
Notes to the financial statements
12 - 26
KDH PROJECTS LIMITED
COMPANY INFORMATION
Director
Mr K D Haynes
Company number
05385561
Registered office
KDH House
Millfield Road
Donington
Spalding
Lincs
PE11 4UR
Auditor
TC Group
1-4 London Road
Spalding
Lincolnshire
PE11 2TA
KDH PROJECTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -

The director presents the strategic report for the year ended 30 June 2023.

Fair review of the business

The director presents the strategic report for the year ended 30 June 2023.

 

During a challenging year for the industry with inflationary pressures on costs, the business has continued to operate efficiently and profitably during the year. The director is confident in the company's position and that the compnay will continue to operate profitably in the coming years.

 

The Company's key performance indicators during the year were:

Unit
2023
2022
Turnover
£
18,221,311
15,586,814
Gross Profit Margin
%
20
13
KDH PROJECTS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
Principal risks and uncertainties

The Company has established a financial management framework whose primary objectives are to protect the Company from events that hinder the achievement of the company's performance objectives. The objectives aim to limit undue counterparty exposure, ensure sufficient working capital exists and monitor the management of risk.

The key risks affecting the Company are set out below:

Market
The industry in which the Company operates, particularly the sector supplying the multiple food manufacturers, is reliant upon their customer's needs and growth strategies. The Company operates a policy of continuously working with its customers to ensure product and service offerings continue to meet and exceed consumer expectation. The Company considers all risks in its quoted job offerings.

Customer and Supplier relationships
The Company recognises the importance of both its customer and supplier relationships in delivering both its strategy and continued growth aspirations. The Company interacts closely and regularly with its customers and suppliers to develop open and honest relationships ensuring focus on project offerings are maintained and allowing challenges to be overcome in an efficient and practical manner.

Employees and labour
The Company values its workforce and recognises the significance this key resource delivers in providing the ability of the Company to achieve its aspirations. In addition, the Company recognises there is a continued demand across the industry for the Company's skilled workforce. The Company manages these risks by ensuring its workforce is highly valued and provides opportunities for development and progression whilst offering fair and competitive remuneration packages.

Credit risk
The Company trades largely with blue chip food manufacturers with which the company considers the credit risk to be low. Nevertheless, the Company operates a policy of regular monitoring of amounts outstanding for both length of time outstanding and credit limits assigned. The company keeps abreast of developments within its customers businesses and monitors reporting for indicators of potential changes in risk levels.

Future developments

The director aims to maintain policies which have resulted in the company's success in recent years. The director consider that the next year will show further success from continuing operations.

On behalf of the board

Mr K D Haynes
Director
17 January 2024
KDH PROJECTS LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -

The director presents his annual report and financial statements for the year ended 30 June 2023.

Principal activities

The principal activity of the company continued to be that of the refurbishment, extension and new build of food and beverage production facilities including storage and associated building works.

Results and dividends

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

Ordinary dividends were paid amounting to £1,000,000. The director does not recommend payment of a final dividend.

Director

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

Mr K D Haynes
Going concern

Inflationary measures on materials and labour continue to have an impact on the industry, however the company continued to trade profitably. These pressures are expected to ease in 2024 and the directors have a reasonable expectation that the company have adequate facilities to continue for a period of at least 12 months following the dates of the finical statements. Given that, the financial statements have been prepared on a going concern basis.

Auditor

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

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.

 

The director has chosen to set out the following information in the strategic report rather than the director's report:

On behalf of the board
Mr K D Haynes
Director
17 January 2024
KDH PROJECTS LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2023
- 4 -

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:

 

 

The director is 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. He is 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.

KDH PROJECTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF KDH PROJECTS LIMITED
- 5 -
Opinion

We have audited the financial statements of KDH Projects Limited (the 'company') for the year ended 30 June 2023 which comprise 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 FRS 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 director's 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 director 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 director is 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.

KDH PROJECTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF KDH PROJECTS LIMITED
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the director's report.

 

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:

 

Responsibilities of director

As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has 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. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

KDH PROJECTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF KDH PROJECTS LIMITED
- 7 -

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

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

 

Our approach was as follows:

• We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussion with the directors and other management (as required by auditing standards), and discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations;

• We considered the legal and regulatory frameworks directly applicable to the financial statements reporting framework (FRS 102 and the Companies Act 2006) and the relevant tax compliance regulations;

• We considered the nature of the industry, the control environment and business performance, including the key drivers for management's remuneration;

• We communicated identified laws and regulations throughout our team and remained alert to any indications of

non-compliance throughout the audit;

• We considered the procedures and controls that the company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those procedures and controls.

 

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations. A further description of our responsibilities is available on the Financial Reporting Council’s website at:https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-forauditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-for-audit.aspx. This description forms part of our auditor’s report.

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.

KDH PROJECTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF KDH PROJECTS LIMITED
- 8 -

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.

Peter Wright (Senior Statutory Auditor)
For and on behalf of TC Group
22 January 2024
Chartered Accountants
Statutory Auditor
1-4 London Road
Spalding
Lincolnshire
PE11 2TA
KDH PROJECTS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
18,221,311
15,586,814
Cost of sales
(14,585,587)
(13,552,165)
Gross profit
3,635,724
2,034,649
Administrative expenses
(2,042,412)
(1,761,663)
Other operating income
11,333
15,779
Operating profit
4
1,604,645
288,765
Interest receivable and similar income
7
14,482
143
Interest payable and similar expenses
8
(64,940)
(48,259)
Profit before taxation
1,554,187
240,649
Tax on profit
9
(295,176)
(63,679)
Profit for the financial year
1,259,011
176,970

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

 

The company has no recognised gains or losses for the year other than the results above.

KDH PROJECTS LIMITED
BALANCE SHEET
AS AT 30 JUNE 2023
30 June 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
978,848
768,142
Current assets
Stocks
13
246,887
317,406
Debtors
14
4,180,034
5,961,610
Cash at bank and in hand
4,329,897
4,232,623
8,756,818
10,511,639
Creditors: amounts falling due within one year
15
(6,771,456)
(8,236,061)
Net current assets
1,985,362
2,275,578
Total assets less current liabilities
2,964,210
3,043,720
Creditors: amounts falling due after more than one year
16
(924,226)
(1,260,145)
Provisions for liabilities
Deferred tax liability
19
90,261
92,863
(90,261)
(92,863)
Net assets
1,949,723
1,690,712
Capital and reserves
Called up share capital
21
100
100
Profit and loss reserves
1,949,623
1,690,612
Total equity
1,949,723
1,690,712
The financial statements were approved and signed by the director and authorised for issue on 17 January 2024
Mr K D Haynes
Director
Company Registration No. 05385561
KDH PROJECTS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 July 2021
100
1,513,642
1,513,742
Year ended 30 June 2022:
Profit and total comprehensive income for the year
-
176,970
176,970
Balance at 30 June 2022
100
1,690,612
1,690,712
Year ended 30 June 2023:
Profit and total comprehensive income for the year
-
1,259,011
1,259,011
Dividends
10
-
(1,000,000)
(1,000,000)
Balance at 30 June 2023
100
1,949,623
1,949,723
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 12 -
1
Accounting policies
Company information

KDH Projects Limited is a private company limited by shares incorporated in England and Wales. The registered office is KDH House, Millfield Road, Donington, Spalding, Lincs, PE11 4UR.

1.1
Accounting convention

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

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

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

Summary of disclosure exemptions

In these financial statements, the company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the following disclosures:
- Cash Flow Statement and related notes.

1.2
Going concern

Inflationary measures on materials and labour continue to have an impact on the industry, however the company continued to trade profitably. These pressures are expected to ease in 2024 and the directors have a reasonable expectation that the company have adequate facilities to continue for a period of at least 12 months following the dates of the finical statements. Given that, the financial statements have been prepared on a going concern basis.true

 

1.3
Turnover

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

 

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

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

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 13 -

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 3 years.

 

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

1.5
Tangible fixed assets

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

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

Freehold land and buildings
2% straight line and 40% reducing balance
Plant and equipment
40% reducing balance
Fixtures and fittings
3 years straight line
Motor vehicles
40% and 15% reducing balance
Garage equipment
25% reducing balance

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.

1.6
Impairment of fixed assets

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

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 14 -

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.

1.7
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.

1.8
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.

1.9
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.

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 15 -
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.

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.

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 16 -
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.

1.10
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.

1.11
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.

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 17 -
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.

1.12
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.

1.13
Retirement benefits

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

1.14
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.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 18 -
2
Judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. These include an estimate over the work in progress and amounts due under construction contracts. It has been deemed that no other judgements have a significant effect on the financial statements other than those discussed.

 

Income and expenditure on construction contracts are recognised based on the project managers assessment of the stage of completion. Project managers are deemed to have the required knowledge and expertise to measure this reliably.

 

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Construction contracts
17,416,813
14,687,229
Service contracts
804,498
899,585
18,221,311
15,586,814
2023
2022
£
£
Other significant revenue
Interest income
14,482
143
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
68
(1,291)
Fees payable to the company's auditor for the audit of the company's financial statements
17,600
13,645
Depreciation of owned tangible fixed assets
171,920
149,131
Profit on disposal of tangible fixed assets
(18,284)
(34,697)
Operating lease charges
1,078,417
970,083
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 19 -
5
Employees

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

2023
2022
Number
Number
Production
41
41
Administration and support
13
12
Total
54
53

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,393,446
2,248,912
Social security costs
266,547
258,627
Pension costs
287,600
76,473
2,947,593
2,584,012
6
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
7,464
7,464
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
11,478
143
Other interest income
3,004
-
0
Total income
14,482
143
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
7
Interest receivable and similar income
(Continued)
- 20 -

Investment income includes the following:

Interest on financial assets not measured at fair value through profit or loss
11,478
143
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
58,859
39,159
Other finance costs:
Interest on finance leases and hire purchase contracts
6,081
9,855
Other interest
-
0
(755)
64,940
48,259
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
297,778
31,873
Deferred tax
Origination and reversal of timing differences
(2,602)
31,806
Total tax charge
295,176
63,679
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
9
Taxation
(Continued)
- 21 -

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
1,554,187
240,649
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
388,547
45,723
Effect of change in corporation tax rate
(65,374)
22,291
Group relief
(25,888)
-
0
Depreciation on assets not qualifying for tax allowances
3,217
2,330
Extra 30% super deduction
(5,326)
(6,665)
Taxation charge for the year
295,176
63,679
10
Dividends
2023
2022
£
£
Interim paid
1,000,000
-
0
11
Intangible fixed assets
Goodwill
£
Cost
At 1 July 2022 and 30 June 2023
240,000
Amortisation and impairment
At 1 July 2022 and 30 June 2023
240,000
Carrying amount
At 30 June 2023
-
0
At 30 June 2022
-
0
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 22 -
12
Tangible fixed assets
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Garage equipment
Total
£
£
£
£
£
£
Cost
At 1 July 2022
449,797
313,714
200,719
824,976
15,931
1,805,137
Additions
235,452
1,143
1,521
153,564
-
0
391,680
Disposals
(10,100)
-
0
-
0
(56,991)
-
0
(67,091)
At 30 June 2023
675,149
314,857
202,240
921,549
15,931
2,129,726
Depreciation and impairment
At 1 July 2022
77,860
238,199
186,504
519,608
14,824
1,036,995
Depreciation charged in the year
10,687
30,206
8,599
122,150
278
171,920
Eliminated in respect of disposals
(7,918)
-
0
-
0
(50,119)
-
0
(58,037)
At 30 June 2023
80,629
268,405
195,103
591,639
15,102
1,150,878
Carrying amount
At 30 June 2023
594,520
46,452
7,137
329,910
829
978,848
At 30 June 2022
371,937
75,515
14,215
305,368
1,107
768,142
13
Stocks
2023
2022
£
£
Finished goods and goods for resale
246,887
317,406
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 23 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,241,116
4,242,441
Gross amounts owed by contract customers
857,767
667,772
Corporation tax recoverable
-
0
133,559
Amounts owed by group undertakings
1,033,949
774,470
Other debtors
2,993
19,586
Prepayments and accrued income
44,209
20,406
4,180,034
5,858,234
2023
2022
Amounts falling due after more than one year:
£
£
Other debtors
-
0
103,376
Total debtors
4,180,034
5,961,610
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
319,527
320,643
Obligations under finance leases
18
56,428
49,418
Trade creditors
1,076,209
1,933,109
Amounts owed to group undertakings
2,992,420
3,782,647
Corporation tax
161,216
-
0
Other taxation and social security
435,291
913,661
Other creditors
84,465
40,898
Accruals and deferred income
1,645,900
1,195,685
6,771,456
8,236,061
KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 24 -
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
810,253
1,133,281
Obligations under finance leases
18
113,973
126,864
924,226
1,260,145
17
Loans and overdrafts
2023
2022
£
£
Bank loans
1,129,780
1,452,284
Bank overdrafts
-
0
1,640
1,129,780
1,453,924
Payable within one year
319,527
320,643
Payable after one year
810,253
1,133,281

Lloyds Fixed Rate Loan is denominated in £ with a nominal interest rate of 4.75%, and the final instalment is due on 1 December 2031. The carrying amount at year end is £105,449 (2022 - £115,337).

A 1st legal charge over commercial freehold held by KDH Projects Limited.

Lloyds Variable Rate Loan is denominated in £ with a nominal interest rate of LIBOR + 3%, and the final instalment is due on 1 December 2031. The carrying amount at year end is £102,767 (2022 - £111,947).

A 1st legal charge over commercial freehold held by KDH Projects Limited.

CBILS Loan is denominated in £ with a nominal interest rate of 1.8%, and the final instalment is due on . The carrying amount at year end is £925,000 (2022 - £1,225,000).

A debenture is held over KDH relating to this loan.

Finance leases are secured against the assets to which they relate.

 

 

 

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 25 -
18
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
56,428
49,418
In two to five years
113,973
126,864
170,401
176,282

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
90,261
92,863
2023
Movements in the year:
£
Liability at 1 July 2022
92,863
Credit to profit or loss
(2,602)
Liability at 30 June 2023
90,261

The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

KDH PROJECTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 26 -
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
287,600
76,473

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.

21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary 0.001p shares
1,000,000
1,000,000
100
100
22
Related party transactions

Summary of transactions with parent

The Company has taken advantage of the exemption in FRS 102 Section 33 from the requirement to disclose transactions with group companies on the grounds that consolidated financial statements are prepared by its parent group.

 

Key management personnel

There are not deemed to be any other key management personnel other than the director.

23
Ultimate controlling party

The company's immediate parent is Moth Holdings Limited, incorporated in England & Wales.

 

The most senior parent entity producing publicly available financial statements is Moth Holdings Limited.

 

These financial statements are available upon request from Unit 6, KDH House, Mill Field Road, Donington, Spalding, England, PE11 4UR.

The ultimate controlling party is Mr K D Haynes who is the managing director.

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