Company Registration No. NI026244 (Northern Ireland)
SAM AEROSPACE (NI) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
SAM AEROSPACE (NI) LIMITED
COMPANY INFORMATION
Directors
Mr Goh Wee Keng
Mr Harro Harms
(Appointed 1 March 2023)
Mr Peter Lim Hee Seng
(Appointed 30 November 2023)
Company number
NI026244
Registered office
Victoria House
15 - 17 Gloucester Street
Belfast
Co. Antrim
Northern Ireland
BT1 4LS
Auditor
Deloitte (NI) Limited
Lincoln Building
27 - 45 Great Victoria Street
Belfast
Co. Antrim
Northern Ireland
BT2 7AQ
Bankers
HSBC
62 - 76 Park Street
London
England
SE1 9DZ
Danske Bank
Donegall Square West
Belfast
Co. Antrim
Northern Ireland
BT1 6JS
Solicitors
Arthur Cox
Victoria House
15-17 Gloucester St
Belfast
Northern Ireland
BT1 4LS
SAM AEROSPACE (NI) LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 9
Statement of comprehensive income
10
Balance sheet
11 - 12
Statement of changes in equity
13
Notes to the financial statements
14 - 35
SAM AEROSPACE (NI) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -
The directors present their strategic report for the year ended 31 March 2023.
Principal Activity
The principal activity of the company continued to be precision engineering within the Aerostructures industry.
During the year, the company's name was changed to Sam Aerospace (NI) Limited having previously been known as J W Kane Precision Engineering Limited
Fair review of the business
The company's turnover for the financial year is £12,376,634 (2022: £6,913,591). The loss before tax in the current year is £2,270,494 compared to the loss before tax of £2,553,238 in the prior financial period. The decrease in losses is primarily due to the recovery of the market post Covid-19 and better cost management structures.
During the year the company continued to invest heavily in planned process improvement with intention to better position itself to remain competitive, to secure additional future business and deliver profitable turnover in the future.
The company has net assets of £148,033 as at 31 March 2023 (2022: £2,404,866). A decrease in net assets is attributable to movement in retained earnings due to loss after tax and other comprehensive expenditure incurred in the current year of £2,256,833 (2022: £2,482,030).
Principal risks and uncertainties
The risk factors that are considered to be most significant to the company's operation, and where applicable how these are managed or mitigated, are outlined below:
Commercial risks
Loss of major customer:
The company’s customer profile is dominated by two main customers in FY 2023 and while the company feels it is uniquely positioned within the niche products it makes, the loss of either customer would have a direct impact on the earnings potential of the business, the company is actively pursuing other avenues to diversify its customer profile, and reduce the potential impact under this risk.
Global market trends:
From February 2023, the global market has seen sharp cost increases in a great number of areas, the company has not been isolated from these sharp unexpected costs and is proactively working to manage and mitigate against these sharp increases were possible.
As the crisis in Ukraine develops, we carried out an initial assessment of indirect impacts of this, such as high inflation, significantly higher energy costs, higher commodity costs, supply chain disruptions and heightened cyber risk. Management regularly review their assessment of the impact of these risks on current operations, and have taken appropriate action to mitigate the risks where possible.
SAM AEROSPACE (NI) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Principal risks and uncertainties cont'd
Financial risks
Foreign exchange rate fluctuations:
The company' prepares its financial statements in pound sterling, but a certain portion of the company's income and costs are and will continue to be in US dollars and Euros. The company has set up a hedging facility to mitigate potential adverse effects of currency fluctuations.
Credit risk:
The Company's principal financial assets are bank balances, cash, and trade and other receivables.
The Company's credit risk is primarily attributable to its trade receivables. The amounts presented in the balance sheet are net of allowances for doubtful debts. An allowance for impairment is made when there is an identified loss event which, based on previous experience, is evidence of a reduction in the recoverability of the cash flows.
Liquidity risk:
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the company relies on intercompany funding arrangements from its parent Singapore Aerospace Manufacturing Pte Limited.
Future Developments
The sharp global price increases in FY 2023, have caused disruption to the world’s economy and business environment. The company is operating within the aerospace industry and has not been isolated from these developments, which have had a negative impact on the company’s financials.
Research and development activities have, and continue to be, focused on improving our capabilities and competitiveness within the global aerospace supply chain for advanced metallic aerospace components and structures. The company aim to create a unique value proposition that maximises quality and minimises waste and to move to a high degree of automation and robotics. This innovation will develop new benchmark processes capable of displacing the competitive advantage of a low-cost countries. This is particularly important for gaining competitive advantage in the changing aerospace market caused by inflationary pressures and further safety measures. The company are actively searching for new contracts and customers.
Mr Harro Harms
Director
31 January 2024
SAM AEROSPACE (NI) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 March 2023.
Results and dividends
The results for the year are set out on page 10.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements, except as noted, were as follows:
Mr Damian McArdle
(Resigned 30 April 2022)
Mr Leong Yew Fai
(Resigned 30 November 2023)
Mr Goh Wee Keng
Mr Harro Harms
(Appointed 1 March 2023)
Mr Peter Lim Hee Seng
(Appointed 30 November 2023)
Directors' insurance
The Parent Undertaking purchased and maintained throughout the financial year Directors' and Officers' liability insurance that covers all officers and directors of the parent company and its subsidiary undertakings.
Auditor
Each of the persons who are directors at the time of this Directors' report has confirmed that:
so far as the directors are aware, there is no relevant audit information of which the Company's auditor is unaware, and
the directors have taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.
This information should be interpreted with the provisions of s418 of the Company Act 2006.
Going concern
The directors have a reasonable expectation that the company has adequate resources to continue its operational existence for the foreseeable future. In preparing the financial statements, the directors have taken into account continued funding support from the parent undertaking by means of intercompany loans and further funding as required to enable the entity to meet its liabilities as they fall due and continue its operations, as expressed in the letter of support by the parent outlining the intention of ongoing support for at least 12 months from the date of approval of these financial statements. Thus the directors continue to adopt the going concern basis of accounting in preparing the annual financial statements.
SAM AEROSPACE (NI) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
On behalf of the board
Mr Harro Harms
Mr Peter Lim Hee Seng
Director
Director
31 January 2024
SAM AEROSPACE (NI) LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 5 -
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, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland". Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
state whether the financial statements have been prepared in accordance with the applicable accounting standards, identify those standards, and note the effect and the reasons for any material departure from those standards.
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.
SAM AEROSPACE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SAM AEROSPACE (NI) LIMITED
- 6 -
Opinion
In our opinion the financial statements of SAM Aerospace (NI) Limited (the ‘company’):
give a true and fair view of the state of the company’s affairs as at 31 March 202 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements which comprise:
the statement of comprehensive loss;
the balance sheet;
the statement of changes in equity; and
the related notes 1 to 2, including the accounting policies in note 1.
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).
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 Financial Reporting Council’s (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.
SAM AEROSPACE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SAM AEROSPACE (NI) LIMITED
- 7 -
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.
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.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
SAM AEROSPACE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SAM AEROSPACE (NI) LIMITED
- 8 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
We considered the nature of the company’s industry and its control environment, and reviewed the company’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities, including those that are specific to the company’s business sector.
We obtained an understanding of the legal and regulatory framework that the company operates in, and identified the key laws and regulations that:
had a direct effect on the determination of material amounts and disclosures in the financial statements. These inluded UK Companies Act, pensions legislation and tax legislation; and
do not have a direct effect on the financial statements but compliance with which may be fundamental to the company’s ability to operate or to avoid a material penalty. These included Health & Safety at Work Act 1974, Equality Act 2010, UK legislation on GDPR and Bribery Act 2010.
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.
As a result of performing the above, we identified the greatest potential for fraud in the following area, and our procedures performed to address it are described below:
Revenue Recognition - We presume a risk of material misstatement due to fraud related to revenue recognition and evaluate which types of revenue, revenue transactions or assertions give rise to such risks. The significant risk has been pinpointed to the cut-off assertion, in particular in relation to credit notes raised post year end by the entity. We assessed the control environment in respect of revenue and performed design and implementation testing on controls over the credit note process. We performed test of details on post year end credit notes raised, and tested a sample of year end and post year end invoices to ensure revenue has been recognised in the correct period.
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.
In addition to the above, our procedures to respond to the risks identified included the following:
reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
enquiring of management concerning actual and potential litigation and claims, and instances of non-compliance with laws and regulations; and
reading minutes of meetings of those charged with governance.
SAM AEROSPACE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SAM AEROSPACE (NI) LIMITED
- 9 -
Report on other legal and regulatory requirements
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
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 any material misstatements in the strategic report or the directors’ report.
Matters on which we are required to report by exception
Under the Companies Act 2006 we are required to report in respect of the following matters if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors’ remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
We have nothing to report in respect of these matters.
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.
Jason Starbuck (Senior statutory auditor)
For and on behalf of Deloitte (NI) Limited
Statutory Auditor
Belfast, United Kingdom
31 January 2024
SAM AEROSPACE (NI) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
2023
2022
Notes
£
£
Turnover
3
12,376,634
6,913,591
Cost of sales
(13,536,755)
(8,596,958)
Gross loss
(1,160,121)
(1,683,367)
Administrative expenses
(1,559,807)
(1,393,515)
Other operating income
967,554
536,580
Operating loss
4
(1,752,374)
(2,540,302)
Interest payable and similar expenses
7
(506,782)
(76,537)
Fair value gains/(losses) on foreign exchange contracts
8
(11,338)
63,601
Loss before taxation
(2,270,494)
(2,553,238)
Tax on loss
9
173
Loss for the financial year
(2,270,494)
(2,553,065)
Other comprehensive loss
Cash flow hedges (loss)/gain arising in the year
(1,371)
91,239
Tax relating to other comprehensive loss
15,032
(20,204)
Total comprehensive loss for the year
(2,256,833)
(2,482,030)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
SAM AEROSPACE (NI) LIMITED
BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
1,799,920
911,262
Tangible assets
11
11,818,564
11,419,967
13,618,484
12,331,229
Current assets
Stocks
13
4,990,912
2,626,644
Debtors
14
4,490,075
2,605,952
Cash at bank and in hand
528,336
208,209
10,009,323
5,440,805
Creditors: amounts falling due within one year
15
(23,115,709)
(14,969,408)
Net current liabilities
(13,106,386)
(9,528,603)
Total assets less current liabilities
512,098
2,802,626
Creditors: amounts falling due after more than one year
16
(184,801)
(240,936)
Provisions for liabilities
Provisions
17
(178,000)
(156,809)
Deferred tax liability
18
(1,264)
(15)
(179,264)
(156,824)
Net assets
148,033
2,404,866
Capital and reserves
Called up share capital
21
130,002
130,002
Share premium account
22
18,855
18,855
Hedging reserve
22
(1,371)
(15,032)
Profit and loss reserves
22
547
2,271,041
Total equity
148,033
2,404,866
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.true
SAM AEROSPACE (NI) LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 MARCH 2023
31 March 2023
- 12 -
The financial statements were approved by the board of directors and authorised for issue on 31 January 2024 and are signed on its behalf by:
Mr Harro Harms
Mr Peter Lim Hee Seng
Director
Director
Company registration number NI026244 (Northern Ireland)
SAM AEROSPACE (NI) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
Share capital
Share premium account
Hedging reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 April 2021
130,002
18,855
(86,067)
4,824,106
4,886,896
Year ended 31 March 2022:
Loss
-
-
-
(2,553,065)
(2,553,065)
Other comprehensive income:
Cash flow hedges gains
-
-
91,239
-
91,239
Tax relating to other comprehensive income
-
-
(20,204)
(20,204)
Total comprehensive loss
-
-
71,035
(2,553,065)
(2,482,030)
Balance at 31 March 2022
130,002
18,855
(15,032)
2,271,041
2,404,866
Year ended 31 March 2023:
Loss
-
-
-
(2,270,494)
(2,270,494)
Other comprehensive income:
Cash flow hedges gains
-
-
(1,371)
-
(1,371)
Tax relating to other comprehensive income
-
-
15,032
15,032
Total comprehensive loss
-
-
13,661
(2,270,494)
(2,256,833)
Balance at 31 March 2023
130,002
18,855
(1,371)
547
148,033
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
1
Accounting policies
The principal accounting policies are summarised below. They have all been applied consistently throughout the year and to the preceding year.
Company information
SAM Aerospace (NI) Limited is a private company limited by shares incorporated in Northern Ireland. The registered office is Victoria House, 15 - 17 Gloucester Street, Belfast, Co. Antrim, Northern Ireland, BT1 4LS.
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 pounds 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 certain financial instruments at fair value. 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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.
The company's business activities, together with factors likely to affect its future development, performance and position are set out in the strategic report, which further describes, where applicable, the financial position of the company, its cash flows, liquidity position and borrowing facilities; the company's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposure to credit risk and liquidity risk.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -
1.2
Going concern
The directors have a reasonable expectation that the company has sufficient resources to continue its operational existence for the foreseeable future. In these considerations the directors recognise that the company relies on financial support from its parent, Singapore Aerospace Manufacturing Pte Ltd, and obtained confirmation that the parent intends to provide adequate financial support to trueSAM Aerospace (NI) Limited to continue its operations and meet its liabilities when they fall due for a period of at least one year after the date these financial statements are signed. Thus, the directors continue to adopt the going concern basis of accounting in preparing the annual financial statements.
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.
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Intangible assets comprise primarily capitalised labour costs relating to a number of projects undertaken by the company. Such assets are defined as having finite useful lives. Once the projects are completed, the costs will be amortised on a straight line basis over their estimated useful lives of 10 years. Intangible assets are stated at cost less amortisation and are reviewed for impairment whenever there is an indication that the carrying value may be impaired.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives. Once amortisation begins, it will be on the following bases:
Development costs
10%
1.6
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
Not depreciated
Freehold buildings
30 Years
Freehold improvements
30 Years
Plant and Machinery
10 Years
Computer Software
5 - 10 Years
Motor vehicles
10 Years
Workshop Equipment
3 - 5 Years
Office Equipment
5 Years
Office Automation Equipment
5 Years
Assets in the course of construction are not depreciated.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.7
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.
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.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
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.
1.8
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.
1.9
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.
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -
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.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
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 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.
1.11
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.
1.12
Derivatives
The company enters into foreign exchange forward contracts in order to manage its exposure to foreign exchange risk.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -
1.13
Hedge accounting
The company designates certain hedging instruments, including derivatives, embedded derivatives and non-derivatives, as either fair value hedges or cash flow hedges. At the inception of the hedge relationship, the company documents the relationship between the hedging instrument and the hedged item along with risk management objectives and strategy for undertaking various hedge transactions. At the inception of the hedge and on an ongoing basis, the company documents whether the hedging instrument is highly effective in offsetting changes in fair values or cash flows of the hedged item.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
For derivatives that are designated and qualify as cash flow hedges, the effective portion of changes in the fair value of the hedge is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss.
Any gain or loss previously recognised in other comprehensive income is reclassified to profit or loss when the hedge relationship ends. This occurs when the hedging instrument expires or no longer meets the hedging criteria, the forecast transaction is no longer highly probable, the hedged debt instrument is derecognised, or the hedging instrument is terminated.
1.14
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
A provision is recognised for those matters for which the tax determination is uncertain but it is considered probable that there will be a future outflow of funds to a tax authority. The provisions are measured at the best estimate of the amount expected to become payable. The assessment is based on the judgement of tax professionals within the Company supported by previous experience in respect of such activities and in certain cases based on specialist independent tax advice.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 21 -
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 measured using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date that are expected to apply to the reversal of the timing difference. 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.
1.15
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.16
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.
1.17
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 22 -
1.18
Leases
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.
1.19
Government grants
Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to the Statement of Profit and Loss at the same rate as the depreciation on the assets to which the grant relates. The current deferred element of grants is included in creditors as accruals and deferred income, the non-current element is included as accruals and deferred income.
Grants of a revenue nature are recognised in the Statement of Profit and Loss in the same period at the related expenditure.
1.20
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the 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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year, are as follows.
Impairment of Fixed Assets
Determining whether tangible fixed assets are impaired requires an estimation of the value in use of the cash generating units to which the assets have been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash generating unit and a suitable discount rate in order to calculate present value. Based on the impairment review carried out, no potential impairments relating to non-current assets was identified. The Net Book Value of all fixed assets is included within Note 11.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
10,675,096
6,208,785
Europe
1,124,408
691,605
Rest of the world
577,130
13,201
12,376,634
6,913,591
2023
2022
£
£
Other revenue
Grants received
147,726
129,145
4
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses
51,156
108,779
Research and development costs
24,110
36,025
Government grants
(147,726)
(129,145)
Fees payable to the company's auditor for the audit of the company's financial statements
37,500
30,900
Depreciation of owned tangible fixed assets
1,409,535
885,495
Profit on disposal of intangible assets
(21,019)
-
Operating lease charges
17,503
26,872
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Directors
-
1
Administration
47
44
Production
58
41
Total
105
86
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
5
Employees
(Continued)
- 24 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
3,275,922
2,356,736
Social security costs
396,795
228,477
Pension costs
83,962
38,685
3,756,679
2,623,898
During the year the company received grants under the Coronavirus Job Retention Scheme of £nil (2022: £20,257).
During the year the company capitalised salaries of £696,558 (2022: £530,006) in the balance sheet as development costs for R&D purposes.
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
-
88,254
Pensions to former directors
1,000
Compensation for loss of office to former director
189,754
190,754
88,254
The above figures exclude Employers NIC.
During the year the company capitalised director salaries of £Nil (2022: £99,823) in the balance sheet as development costs for R&D purposes.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest payable to group undertakings
506,688
75,246
Other interest on financial liabilities
910
506,688
76,156
Other finance costs:
Other interest
94
381
506,782
76,537
8
Fair value (losses)/ gains on financial instruments
2023
2022
£
£
Fair value (losses)/gains on financial instruments
Exchange differences on the fair value hedging instruments
(11,338)
63,601
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(173)
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
9
Taxation
(Continued)
- 26 -
The actual charge/(credit) for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(2,270,494)
(2,553,238)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
(431,394)
(485,115)
Tax effect of expenses that are not deductible in determining taxable profit
102,018
19,998
Tax effect of income not taxable in determining taxable profit
(14,036)
Group relief
(173)
Under/(over) provided in prior years
(670)
Deferred tax not recognised
343,412
458,372
Tax rate changes
7,415
Taxation charge/(credit) for the year
-
(173)
In addition to the amount charged/(credited) to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2023
2022
£
£
Deferred tax arising on:
Revaluation of financial instruments treated as cash flow hedges
(15,032)
20,204
The standard rate of tax applied to reported profit is 19% (2022: 19%). The applicable tax rate has changed following the substantive enactment of the Finance Act 2021.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
10
Intangible fixed assets
Development costs
£
Cost
At 1 April 2022
911,262
Additions
888,658
At 31 March 2023
1,799,920
Amortisation and impairment
At 1 April 2022 and 31 March 2023
Carrying amount
At 31 March 2023
1,799,920
At 31 March 2022
911,262
Development costs have been capitalised in accordance with the requirements of FRS 102 and are therefore not treated, for dividend purposes, as a realised loss.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 28 -
11
Tangible fixed assets
Freehold land
Freehold buildings
Freehold improvements
Assets under construction
Plant and Machinery
Computer Software
Motor vehicles
Workshop Equipment
Office Equipment
Office Automation Equipment
Total
£
£
£
£
£
£
£
£
£
£
£
Cost
At 1 April 2022
300,000
3,915,035
2,782
5,924,439
10,746,451
181,946
21,150
27,056
91,531
613,882
21,824,272
Additions
13,286
1,569,222
87,086
3,336
128,242
27,579
1,828,751
Disposals
(332,134)
-
(332,134)
Transfers
(4,751,470)
4,672,462
79,008
-
At 31 March 2023
300,000
3,915,035
16,068
2,742,191
15,173,865
264,290
21,150
155,298
91,531
641,461
23,320,889
Depreciation and impairment
At 1 April 2022
449,768
256
9,286,548
49,140
4,930
4,187
83,427
526,049
10,404,305
Depreciation charged in the year
129,348
414
1,179,030
35,894
2,115
15,060
3,297
44,377
1,409,535
Eliminated in respect of disposals
(311,515)
-
(311,515)
At 31 March 2023
579,116
670
10,154,063
85,034
7,045
19,247
86,724
570,426
11,502,325
Carrying amount
At 31 March 2023
300,000
3,335,919
15,398
2,742,191
5,019,802
179,256
14,105
136,051
4,807
71,035
11,818,564
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
11
Tangible fixed assets
(Continued)
- 29 -
At 31 March 2022
300,000
3,465,267
2,526
5,924,439
1,459,903
132,806
16,220
22,869
8,104
87,833
11,419,967
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 30 -
12
Financial instruments
2023
2022
£
£
Carrying amount of financial assets
Derivatives financial assets measured at:
- Fair value through Statement of comprehensive income
7,271
78
- Fair value through Profit and loss
(4,953)
16,850
Derivatives financial liabilities measured at:
- Fair value through Statement of comprehensive income
-
-
- Fair value through Profit and loss
-
-
Derivative financial instruments - forward contracts and options
The company has entered into a number of foreign currency derivative contracts during the year to hedge the exchange rate risk.
The fair value of the derivative financial instruments has been determined using using market prices.
The movement in fair value of currency contracts in relation to operations has been recognised through the Profit and Loss Account. The movement in fair value of currency contracts in relation to capital expenditure has been recognised through the Hedging Reserve and associated deferred tax calculated on this.
The following table details the forward foreign currency contracts outstanding as at the year-end:
Outstanding contracts
Notional value
Fair value
2023
2022
2023
2022
£
£
£
£
Sell USD
Less than 12 months
700,000
356,401
(4,953)
16,081
Sell EUR
Less than 12 months
1,191,578
250,145
7,271
847
The company has entered into forward foreign currency contracts to hedge the exchange rate risk arising from anticipated future requirements, which are designated as cash flow hedges. The hedged cash flows are expected to occur and affect profit or loss and other comprehensive income within the next 12 months and therefore are classed as current liabilities.
Gains of £13,661 (2022: £71,035) were recognised in other comprehensive income and hedge ineffectiveness resulting in a loss of £11,338 (2022: Gain £63,601) was recognised in profit and loss account.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 31 -
13
Stocks
2023
2022
£
£
Raw materials and consumables
2,575,018
1,156,693
Work in progress
1,729,427
1,171,034
Finished goods and goods for resale
686,467
298,917
4,990,912
2,626,644
Stocks are stated after provisions for impairment of £518,944 (2022: £400,088).
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
4,204,322
2,295,236
Corporation tax recoverable
94,107
Derivative financial instruments
2,318
16,928
Other debtors
82,645
56,765
Prepayments and accrued income
200,790
142,916
4,490,075
2,605,952
All trade debtors are due within the company's normal terms.
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Trade creditors
2,276,154
1,585,673
Amounts owed to group undertakings
19,955,509
12,856,520
Taxation and social security
314,405
147,588
Government grants
19
43,008
49,362
Accruals and deferred income
526,633
330,265
23,115,709
14,969,408
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
15
Creditors: amounts falling due within one year
(Continued)
- 32 -
Trade and other creditors are payable at various dates over the next 12 months in accordance with the usual credit terms.
Tax and social securities are payable at various dates over the coming months in line with tax authority guidelines.
Amounts owed to group undertakings are charged at an interest rate of 4.71% for GBP loans and 2.68% for USD loans during the year. The parent will not demand repayment of the loan for 12 month from the date of signing of these financial statements.
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Government grants
19
184,801
240,936
17
Provisions for liabilities
2023
2022
£
£
Warranty Provision
178,000
156,809
Movements on provisions:
£
At 1 April 2022
156,809
Additional provisions in the year
21,191
At 31 March 2023
178,000
The above provision is a specific group policy in relation to potential defects on work for specific contracts.
Crystallisation is expected less than one year from the reporting date.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 33 -
18
Deferred taxation
Liabilities
Liabilities
2023
2022
Balances:
£
£
Other
1,264
15
2023
Movements in the year:
£
Liability at 1 April 2022
15
Charge to other comprehensive income
1,249
Liability at 31 March 2023
1,264
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.
19
Government grants
2023
2022
£
£
Arising from government grants
227,809
290,298
Included in the financial statements as follows:
Current liabilities
43,008
49,362
Non-current liabilities
184,801
240,936
227,809
290,298
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
83,962
38,685
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.
There was a balance of £34,913 (2022: £10,232) due to the provider as at 31 March 2023.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 34 -
21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
130,002
130,000
130,002
130,000
B Ordinary Share of £1 each
-
1
-
1
C Ordinary Share of £1 each
-
1
-
1
130,002
130,002
130,002
130,002
22
Reserves
Share premium
The share premium reserve contains the premium arising on issue of equity shares, net of issue expenses.
Hedging reserve
The hedging reserve represents the cumulative portion of gains and losses on foreign exchange commitments. Amounts accumulated in this reserve are reclassified to profit or loss when the hedging relationship ends.
Profit and loss reserve
The profit and loss reserve represents cumulative profits or losses, including unrealised profit on the remeasurement of investment properties, net of dividends paid and other adjustments.
23
Financial commitments, guarantees and contingent liabilities
Under the terms of letters of offer from Invest NI there is a contingent liability to repay certain grants received if the Company fails to achieve and maintain specified targets. In the opinion of the directors, the terms of the letters of offer have been complied with and no loss is expected.
The Company, from time to time, can be party to legal proceedings and claims which arise in the ordinary course of business. The directors do not anticipate that the outcome of any such proceedings, actions and claims, either individually or in aggregate, will have a material adverse effect upon the Company's financial position.
SAM AEROSPACE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 35 -
24
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
8,294
14,305
Between two and five years
11,419
13,561
19,713
27,866
25
Related party transactions
The company has availed of the exemption under FRS 102 in relation to the disclosure of transactions with wholly owned group companies.
26
Ultimate controlling party
The immediate parent company of SAM Aerospace (NI) Limited (Formerly J.W. Kane Precision Engineering Limited) is Singapore Aerospace Manufacturing Pte Limited, a company incorporated in Singapore.
The ultimate parent undertaking and controlling party is Temasek Holdings (Private) Limited, a company incorporated in Singapore. Temasek Holdings (Private) Limited is the largest group into which the results of the company are consolidated. Copies of its financial statements are available from its registered office 608 Orchard Road, #06-18 Tower 2, The Atrium@Orchard, Singapore, 238891.
2023-03-312022-04-01falseCCH SoftwareCCH Accounts Production 2023.300No description of principal activityMr Damian McArdleMr Leong Yew FaiMr Goh Wee KengMr Harro HarmsMr Peter Lim Hee 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