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REGISTERED NUMBER: SC183317 (Scotland)















Group Strategic Report, Report of the Directors and

Consolidated Financial Statements For The Year Ended 31 July 2023

for

Scotweld Group Services Limited

Scotweld Group Services Limited (Registered number: SC183317)






Contents of the Consolidated Financial Statements
For The Year Ended 31 July 2023




Page

Company Information 1

Group Strategic Report 2

Report of the Directors 4

Report of the Independent Auditors 6

Consolidated Statement of Comprehensive Income 10

Consolidated Statement of Financial Position 11

Company Statement of Financial Position 12

Consolidated Statement of Changes in Equity 13

Company Statement of Changes in Equity 14

Consolidated Statement of Cash Flows 15

Notes to the Consolidated Statement of Cash Flows 16

Notes to the Consolidated Financial Statements 18


Scotweld Group Services Limited

Company Information
For The Year Ended 31 July 2023







DIRECTORS: G Nixon
Ms F Baggley
R K Sinha





SECRETARY: Ms F Baggley





REGISTERED OFFICE: 270 Petershill Road
Glasgow
G21 4AY





REGISTERED NUMBER: SC183317 (Scotland)





INDEPENDENT AUDITORS: Robb Ferguson
Chartered Accountants & Statutory Auditors
Regent Court
70 West Regent Street
Glasgow
G2 2QZ

Scotweld Group Services Limited (Registered number: SC183317)

Group Strategic Report
For The Year Ended 31 July 2023

The directors present their strategic report of the company and the group for the year ended 31 July 2023.

REVIEW OF BUSINESS
The year to 31st July 2023 has seen the best financial performance in several years, the significant turnaround in fortune can be attributed to improved client engagement, price modelling and adoption of digitalisation. However, whilst this is welcome news, areas that have had a material drag on performance was firstly, periods of slow sales caused by Industrial action within the Railway Network through the first half of the year. Secondly, the wider UK environment of high inflation / Inflated wage demands. Combined, these factors blunted the company's financial performance and its ability to improve margins. The company where possible has taken mitigating measures in managing costs on existing contracts and then taken a prudent view of the inflation curve when quoting for medium to long term contracts whilst remaining market competitive.

As a result of these factors, turnover in the year increased by less than expected at 33.4%. Gross margin increased slightly to 20.96% from 20.31%, contributing to an operating profit before tax for the year of £292,631. The company has thus improved its positive net position reversing the movement caused by the Loss from the prior year.

The company prides itself on its safety record, staff training, assessment and development. Our dedicated HSQE and HR departments work in tandem with our operational managers to ensure that our policies and procedures are carried out faithfully, ensure fairness and equitable treatment for all staff, workers, suppliers and clients. In addition, we continue to be highly regarded by various industry bodies such as BSI, Sentinel, RICA, RISQS, Constructionline, CIRCA and have been nominated for many awards during the year.

KEY PERFORMANCE INDICATORS (KPI's)
Financial KPI's
The directors use Financial Key Performance Indicators to measure and monitor sales levels, gross margins, overheads and net profitability.
2023 2022
Growth in turnover 33.40% 4.6%
Gross profit percentage 20.96% 20.31%

For the period under review, each indicator is reviewed against target, analysis is subsequently performed for each of the profit centres within the company. The KPls are reviewed by the Board monthly using a traffic light system. In the result of any underperformance being flagged , it is discussed within the management team, and corrective action taken without delay. The KPI's assessed during the year were largely in line with management expectations. Where a negative trend started to develop corrective action was undertaken.

Non-Financial KPIs
The company measures and monitors its performance by means of KPI's which are set annually. The most important measure in place is the safety and well-being of our employees who are the most important asset. In order to achieve this, a target of "Zero Injury or Harm" is set. This is monitored and measured throughout the year by our dedicated HSQE Department. In relation to our Corporate and Social Responsibility. Each year the business strives to reduce its Carbon Foot-Print, measuring its output every month against set targets, including but not limited to fuel usage, energy consumed, and waste produced. The business continues to strive towards net zero.

PRINCIPAL RISKS AND UNCERTAINTIES
Financial Risk Management
The company monitors working capital management strictly. Financial risk is largely negated due to the net worth and financial viability of the company.
The company's principal financial instruments comprise cash and borrowing.
The company has various other financial instrument such as trade debtors and creditors that arise directly from its trading operations.
The main risks arising from the company's financial instruments are with liquidity and credit. The company has clear policies for managing these risks as summarised below.



Scotweld Group Services Limited (Registered number: SC183317)

Group Strategic Report
For The Year Ended 31 July 2023


Liquidity Risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. Investment levels and cash flows are carefully controlled, with authorisation limits operating at different levels up to company board level.

Credit Risk
Risk of financial loss due to a counterpart's failure to honour its obligations arises principally in relation to transactions where the group provides goods or services on deferred credit terms. Company policies are aligned at minimising such losses, and require that deferred credit terms are granted only to customers who demonstrate an appropriate payment history and satisfy creditworthiness procedures.

Cash Flow Risk
The company finances ongoing activities and capital expenditure through a combination of retained profits and bank borrowings. The company operates a strict regime of working capital management to mitigate cash flow risk. Detailed financial planning and regular monitoring of cash flow are used to manage the facilities and maintain the company's adherence with repayment schedules.

Competitive Risk Assessment
The company operates in a competitive environment; however, the director believes that the company through continued focus on cost reduction and continued investment in new products is well placed to continue developing its market share.

FUTURE PROSPECTS
Whilst SWGR is the largest provider of professional protection staff to the Railway within the UK by Geographical coverage, its AIM over the next five years is to become the largest by number of protections placed and support staff provided. The boards aspirations are aligned with its strong safety record, culture and commitment to modernising and professionalising the segment of the industry.

ON BEHALF OF THE BOARD:





Ms F Baggley - Director


15 February 2024

Scotweld Group Services Limited (Registered number: SC183317)

Report of the Directors
For The Year Ended 31 July 2023

The directors present their report with the financial statements of the company and the group for the year ended 31 July 2023.

DIVIDENDS
No interim dividends were paid during the year ended 31 July 2023.

The directors recommend final dividends per share as follows:

Ordinary £0.0001 shares £2.40
A ordinary £0.0001 shares NIL

The total distribution of dividends for the year ended 31 July 2023 will be £ 120,000 .

DIRECTORS
The directors shown below have held office during the whole of the period from 1 August 2022 to the date of this report.

G Nixon
Ms F Baggley
R K Sinha

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Scotweld Group Services Limited (Registered number: SC183317)

Report of the Directors
For The Year Ended 31 July 2023


STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

ON BEHALF OF THE BOARD:





Ms F Baggley - Director


15 February 2024

Report of the Independent Auditors to the Members of
Scotweld Group Services Limited

Opinion
We have audited the financial statements of Scotweld Group Services Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2023 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the group's and of the parent company affairs as at 31 July 2023 and of the group's profit for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Scotweld Group Services Limited


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
- the parent company financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group's and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.

Report of the Independent Auditors to the Members of
Scotweld Group Services Limited


Auditors' responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
- The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
- We identified the laws and regulations applicable to the company through discussions with directors and other management, and from our wider knowledge and experience;
- We focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006 and FRS 102
- We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
- Identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
- Making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
- Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations

Audit response to risks identified
To address the risk of fraud through management bias and override of controls, we:
- Performed analytical procedures to identify any unusual or unexpected relationships;
- Tested journal entries to identify unusual transactions;
- Assessed whether judgements and assumptions made in determining the accounting estimates set out were indicative of potential bias; and
- Investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
- Agreeing financial statement disclosures to underlying supporting documentation;
- Enquiring of management as to actual and potential litigation and claims; and
- Requesting correspondence with HMRC and Companies House.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Report of the Independent Auditors to the Members of
Scotweld Group Services Limited


Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.




Graham Cantlay CA (Senior Statutory Auditor)
for and on behalf of Robb Ferguson
Chartered Accountants & Statutory Auditors
Regent Court
70 West Regent Street
Glasgow
G2 2QZ

15 February 2024

Scotweld Group Services Limited (Registered number: SC183317)

Consolidated
Statement of Comprehensive
Income
For The Year Ended 31 July 2023

2023 2022
Notes £    £   

TURNOVER 3 17,292,968 12,966,085

Cost of sales 13,669,048 10,333,090
GROSS PROFIT 3,623,920 2,632,995

Administrative expenses 3,309,872 2,920,626
314,048 (287,631 )

Other operating income 87,495 30,156
OPERATING PROFIT/(LOSS) 5 401,543 (257,475 )


Interest payable and similar expenses 6 5,473 524
PROFIT/(LOSS) BEFORE TAXATION 396,070 (257,999 )

Tax on profit/(loss) 7 94,135 (12,767 )
PROFIT/(LOSS) FOR THE FINANCIAL
YEAR

301,935

(245,232

)

OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE
INCOME/(LOSS) FOR THE YEAR

301,935

(245,232

)

Profit/(loss) attributable to:
Owners of the parent 301,935 (245,232 )

Total comprehensive income/(loss) attributable to:
Owners of the parent 301,935 (245,232 )

Scotweld Group Services Limited (Registered number: SC183317)

Consolidated Statement of Financial Position
31 July 2023

2023 2022
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 10 2,298 5,499
Tangible assets 11 1,054,053 1,123,322
Investments 12 - -
1,056,351 1,128,821

CURRENT ASSETS
Stocks 13 167,351 171,961
Debtors 14 2,477,934 2,255,707
Cash at bank and in hand 144,695 67,742
2,789,980 2,495,410
CREDITORS
Amounts falling due within one year 15 1,814,719 1,823,471
NET CURRENT ASSETS 975,261 671,939
TOTAL ASSETS LESS CURRENT
LIABILITIES

2,031,612

1,800,760

PROVISIONS FOR LIABILITIES 19 48,917 -
NET ASSETS 1,982,695 1,800,760

CAPITAL AND RESERVES
Called up share capital 20 6 6
Share premium 21 599,997 599,997
Retained earnings 21 1,382,692 1,200,757
SHAREHOLDERS' FUNDS 1,982,695 1,800,760

The financial statements were approved by the Board of Directors and authorised for issue on 15 February 2024 and were signed on its behalf by:





G Nixon - Director


Scotweld Group Services Limited (Registered number: SC183317)

Company Statement of Financial Position
31 July 2023

2023 2022
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 10 - -
Tangible assets 11 1,301,497 1,333,057
Investments 12 809,049 809,049
2,110,546 2,142,106

CURRENT ASSETS
Cash at bank 85,420 35,423

CREDITORS
Amounts falling due within one year 15 259,095 195,741
NET CURRENT LIABILITIES (173,675 ) (160,318 )
TOTAL ASSETS LESS CURRENT
LIABILITIES

1,936,871

1,981,788

CAPITAL AND RESERVES
Called up share capital 20 6 6
Share premium 599,997 599,997
Retained earnings 1,336,868 1,381,785
SHAREHOLDERS' FUNDS 1,936,871 1,981,788

Company's profit for the financial year 75,083 23,441

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 15 February 2024 and were signed on its behalf by:





G Nixon - Director


Scotweld Group Services Limited (Registered number: SC183317)

Consolidated Statement of Changes in Equity
For The Year Ended 31 July 2023

Called up
share Retained Share Total
capital earnings premium equity
£    £    £    £   
Balance at 1 August 2021 6 1,545,989 599,997 2,145,992

Changes in equity
Dividends - (100,000 ) - (100,000 )
Total comprehensive loss - (245,232 ) - (245,232 )
Balance at 31 July 2022 6 1,200,757 599,997 1,800,760

Changes in equity
Dividends - (120,000 ) - (120,000 )
Total comprehensive income - 301,935 - 301,935
Balance at 31 July 2023 6 1,382,692 599,997 1,982,695

Scotweld Group Services Limited (Registered number: SC183317)

Company Statement of Changes in Equity
For The Year Ended 31 July 2023

Called up
share Retained Share Total
capital earnings premium equity
£    £    £    £   
Balance at 1 August 2021 6 1,458,344 599,997 2,058,347

Changes in equity
Dividends - (100,000 ) - (100,000 )
Total comprehensive income - 23,441 - 23,441
Balance at 31 July 2022 6 1,381,785 599,997 1,981,788

Changes in equity
Dividends - (120,000 ) - (120,000 )
Total comprehensive income - 75,083 - 75,083
Balance at 31 July 2023 6 1,336,868 599,997 1,936,871

Scotweld Group Services Limited (Registered number: SC183317)

Consolidated Statement of Cash Flows
For The Year Ended 31 July 2023

2023 2022
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 438,066 (531,842 )
Interest paid (5,473 ) (524 )
Tax paid 17,008 (12,883 )
Net cash from operating activities 449,601 (545,249 )

Cash flows from investing activities
Purchase of tangible fixed assets (56,843 ) (135,226 )
Sale of tangible fixed assets 5,333 21,950
Net cash from investing activities (51,510 ) (113,276 )

Cash flows from financing activities
Amount introduced by directors 100,000 87,484
Amount withdrawn by directors (94,290 ) (21,724 )
Government grants - 1,679
Equity dividends paid (120,000 ) (100,000 )
Net cash from financing activities (114,290 ) (32,561 )

Increase/(decrease) in cash and cash equivalents 283,801 (691,086 )
Cash and cash equivalents at beginning of
year

2

(382,813

)

308,273

Cash and cash equivalents at end of year 2 (99,012 ) (382,813 )

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Statement of Cash Flows
For The Year Ended 31 July 2023

1. RECONCILIATION OF PROFIT/(LOSS) BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
2023 2022
£    £   
Profit/(loss) before taxation 396,070 (257,999 )
Depreciation charges 123,977 114,217
Profit on disposal of fixed assets - (5,301 )
Government grants - (1,679 )
Finance costs 5,473 524
525,520 (150,238 )
Decrease in stocks 4,610 62,529
Increase in trade and other debtors (222,227 ) (690,778 )
Increase in trade and other creditors 130,163 246,645
Cash generated from operations 438,066 (531,842 )

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 July 2023
31.7.23 1.8.22
£    £   
Cash and cash equivalents 144,695 67,742
Bank overdrafts (243,707 ) (450,555 )
(99,012 ) (382,813 )
Year ended 31 July 2022
31.7.22 1.8.21
£    £   
Cash and cash equivalents 67,742 308,273
Bank overdrafts (450,555 ) -
(382,813 ) 308,273


Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Statement of Cash Flows
For The Year Ended 31 July 2023

3. ANALYSIS OF CHANGES IN NET DEBT

At 1.8.22 Cash flow At 31.7.23
£    £    £   
Net cash
Cash at bank and in hand 67,742 76,953 144,695
Bank overdrafts (450,555 ) 206,848 (243,707 )
(382,813 ) 283,801 (99,012 )
Total (382,813 ) 283,801 (99,012 )

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements
For The Year Ended 31 July 2023

1. STATUTORY INFORMATION

Scotweld Group Services Limited is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

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

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

Basis of consolidation
The consolidated financial statements incorporate those of Scotweld Group Services Limited and its subsidiary undertaking for the year. Subsidiaries acquired during the year are consolidated using the acquisition method. Their results are incorporated from the date that control passes. All intra-group transactions, balances and unrealised gains between group companies are eliminated on consolidation.

Significant judgements and estimates
In the application of the company's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying value 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.

The following judgements (apart from those involving estimates) have had the most significant effect on the financial statements.

Accruals
As part of the month and year end process, management are required to estimate requirements for accruals. These estimates are arrived at based on their knowledge of the business coupled with post year end information identifying expenses incurred relating to the previous financial period.

Stock
In arriving at the valuation of stock it may be necessary for management to make an assessment of over the carrying value of stock items and where applicable apply a provision to amend this carrying value to a more accurate level. These provisions are arrived at using management's knowledge and understanding of the business and the industry in which it operates and focuses on potentially obsolete or old items for which the full value may no longer be recoverable.

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Turnover
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company and

the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates and value added tax. The following criteria must also be met before revenue is recognised:

Rendering of Services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

- the amount of revenue can be measured reliably:

- it is probable that the company will receive the consideration due ,under the contract;

- the stage of completion of the contract at the end of the reporting period can be measured reliably, and;

- the costs incurred and the costs to complete the contract can be measured reliably.

Sale of goods
Turnover from the sale of goods is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Geographical split of turnover
All turnover is derived from the principal activity of the company in the United Kingdom.

Negative goodwill
Negative goodwill, being the amount paid in connection with the acquisition of a business in 0, is being amortised evenly over its estimated useful life of nil years.

Where the purchase price is less that the net assets acquired, a detailed review is undertaken of the assets and liabilities acquired to confirm they are stated at fair value. If after this review, the negative goodwill is still supported, it is released to profit and loss account over the period during which benefit is derived from associated non-monetary assets.

Intangible assets
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Computer software is being amortised evenly over its estimated useful life of 3 years.

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Freehold property - 2% on cost
Improvements to property - 25% on cost
Plant and machinery - 20-25% on cost
Fixtures and fittings - 15% on cost
Motor vehicles - 20% on cost
Office equipment - 25% - 33.3% on cost

Impairment of fixed assets
At each reporting 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.

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.

Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Financial instruments
The company has elected to apply the provisions of Section 11 'Basic Financial Instruments' of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's statement of financial position 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 1s 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.

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 investment is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments arc subsequently carried at amortised cost, using the effective interest rate method.


Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued
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.

Derecognition of financial liabilities
Financial liabilities are derecognised when the company's contractual obligations expire or are discharged or cancelled.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing commitments
Assets held under finance leases or hire purchase contracts are capitalised under tangible fixed assets in the balance sheet and depreciated over their useful economic lives. The capital element of the future payments 1s treated as a liability and the interest element charged to the profit and loss account.

Rentals payable under operating leases are charged to the profit and loss account on a straight line basis over the tenn of the agreement.

Rentals received under the operating leases are credited to the profit and loss account on a straight line basis over the term of the agreement.

Pension costs and other post-retirement benefits
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

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.

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Debtors and creditors receivable/payable within one year
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.

Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs arc
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.

3. TURNOVER

The turnover and profit (2022 - loss) before taxation are attributable to the one principal activity of the group.

An analysis of turnover by class of business is given below:

2023 2022
£    £   
Sales of goods 600,978 613,963
Rendering of services 16,691,990 12,352,122
17,292,968 12,966,085

The turnover and profit (2022 - loss) before taxation are attributable to the one principal activity of the company.

4. EMPLOYEES AND DIRECTORS
2023 2022
£    £   
Wages and salaries 5,565,444 3,376,395
Social security costs 567,879 316,711
Other pension costs 47,065 61,102
6,180,388 3,754,208

The average number of employees during the year was as follows:
2023 2022

Security 3 3
Admin 18 17
Service 85 116
106 136

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

4. EMPLOYEES AND DIRECTORS - continued

2023 2022
£    £   
Directors' remuneration 218,630 254,436
Directors' pension contributions to money purchase schemes 6,500 6,500

Information regarding the highest paid director is as follows:
2023 2022
£    £   
Emoluments etc 140,208 132,000

5. OPERATING PROFIT/(LOSS)

The operating profit (2022 - operating loss) is stated after charging/(crediting):

2023 2022
£    £   
Plant hire and maintenance 678,755 566,459
Depreciation - owned assets 120,779 111,016
Profit on disposal of fixed assets - (5,301 )
Negative goodwill amortisation - (217,973 )
Computer software amortisation 3,201 3,201
Auditors' remuneration 7,000 7,885

6. INTEREST PAYABLE AND SIMILAR EXPENSES
2023 2022
£    £   
Bank interest 5,473 524

7. TAXATION

Analysis of the tax charge/(credit)
The tax charge/(credit) on the profit for the year was as follows:
2023 2022
£    £   
Current tax:
UK corporation tax 45,218 (12,767 )

Deferred tax 48,917 -
Tax on profit/(loss) 94,135 (12,767 )

UK corporation tax has been charged at 21 % .

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

7. TAXATION - continued

Reconciliation of total tax charge/(credit) included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
£    £   
Profit/(loss) before tax 396,070 (257,999 )
Profit/(loss) multiplied by the standard rate of corporation tax in the UK of 21
% (2022 - 0 %)

83,175

-

Effects of:
Expenses not deductible for tax purposes 8,607 -
Depreciation in excess of capital allowances 13,379 -
Utilisation of tax losses (59,943 ) -
Adjustments to tax charge in respect of previous periods - (12,767 )
Deferred tax 48,917 -
Total tax charge/(credit) 94,135 (12,767 )

8. INDIVIDUAL STATEMENT OF COMPREHENSIVE INCOME

As permitted by Section 408 of the Companies Act 2006, the Statement of Comprehensive Income of the parent company is not presented as part of these financial statements.


9. DIVIDENDS
2023 2022
£    £   
Ordinary shares of £0.0001 each
Final 120,000 100,000

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

10. INTANGIBLE FIXED ASSETS

Group
Negative Computer
goodwill software Totals
£    £    £   
COST
At 1 August 2022
and 31 July 2023 (217,973 ) 9,700 (208,273 )
AMORTISATION
At 1 August 2022 (217,973 ) 4,201 (213,772 )
Amortisation for year - 3,201 3,201
At 31 July 2023 (217,973 ) 7,402 (210,571 )
NET BOOK VALUE
At 31 July 2023 - 2,298 2,298
At 31 July 2022 - 5,499 5,499

11. TANGIBLE FIXED ASSETS

Group
Improvements
Freehold to Plant and
property property machinery
£    £    £   
COST
At 1 August 2022 1,323,218 56,120 191,983
Additions - 7,086 1,339
Disposals - - -
At 31 July 2023 1,323,218 63,206 193,322
DEPRECIATION
At 1 August 2022 462,370 41,499 50,713
Charge for year 31,560 9,583 28,352
Eliminated on disposal - - -
At 31 July 2023 493,930 51,082 79,065
NET BOOK VALUE
At 31 July 2023 829,288 12,124 114,257
At 31 July 2022 860,848 14,621 141,270

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

11. TANGIBLE FIXED ASSETS - continued

Group

Fixtures
and Motor Office
fittings vehicles equipment Totals
£    £    £    £   
COST
At 1 August 2022 781 108,877 74,595 1,755,574
Additions - - 48,418 56,843
Disposals - (10,000 ) - (10,000 )
At 31 July 2023 781 98,877 123,013 1,802,417
DEPRECIATION
At 1 August 2022 644 55,518 21,508 632,252
Charge for year 117 16,341 34,826 120,779
Eliminated on disposal - (4,667 ) - (4,667 )
At 31 July 2023 761 67,192 56,334 748,364
NET BOOK VALUE
At 31 July 2023 20 31,685 66,679 1,054,053
At 31 July 2022 137 53,359 53,087 1,123,322

Company
Freehold
property
£   
COST
At 1 August 2022
and 31 July 2023 1,577,972
DEPRECIATION
At 1 August 2022 244,915
Charge for year 31,560
At 31 July 2023 276,475
NET BOOK VALUE
At 31 July 2023 1,301,497
At 31 July 2022 1,333,057

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

12. FIXED ASSET INVESTMENTS

Company
Shares in
group
undertaking
£   
COST
At 1 August 2022
and 31 July 2023 809,049
NET BOOK VALUE
At 31 July 2023 809,049
At 31 July 2022 809,049

The group or the company's investments at the Statement of Financial Position date in the share capital of companies include the following:

Subsidiary

SW Global Resourcing Limited
Registered office:
Nature of business: Contract Employment
%
Class of shares: holding
Ordinary 100.00


13. STOCKS

Group
2023 2022
£    £   
Stocks 167,351 171,961

14. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group
2023 2022
£    £   
Trade debtors 413,614 1,236,593
Other debtors 7,995 6,226
Prepayments and accrued income 2,056,325 1,012,888
2,477,934 2,255,707

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
2023 2022 2023 2022
£    £    £    £   
Bank loans and overdrafts (see note 16) 243,707 450,555 - -
Trade creditors 511,904 446,679 - -
Amounts owed to group undertakings - - 195,683 195,684
Tax 62,571 345 28,412 57
Social security and other taxes 181,079 156,533 - -
VAT 308,695 315,275 - -
Directors' current accounts 27,818 22,108 35,000 -
Accruals and deferred income 478,945 431,976 - -
1,814,719 1,823,471 259,095 195,741

16. LOANS

An analysis of the maturity of loans is given below:

Group
2023 2022
£    £   
Amounts falling due within one year or on demand:
Bank overdrafts 243,707 450,555

17. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Non-cancellable operating leases
2023 2022
£    £   
Within one year 184,209 53,250
Between one and five years 203,477 25,482
387,686 78,732

18. SECURED DEBTS

Clydesdale Bank Plc hold a standard security over the property and a floating charge over the assets present and future of the company.

Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

19. PROVISIONS FOR LIABILITIES

Group
2023 2022
£    £   
Deferred tax 48,917 -

Group
Deferred
tax
£   
Provided during year 48,917
Balance at 31 July 2023 48,917

20. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2023 2022
value: £    £   
50,000 Ordinary £0.0001 5 5
5,555 A ordinary £0.0001 1 1
6 6

21. RESERVES

Group
Retained Share
earnings premium Totals
£    £    £   

At 1 August 2022 1,200,757 599,997 1,800,754
Profit for the year 301,935 301,935
Dividends (120,000 ) (120,000 )
At 31 July 2023 1,382,692 599,997 1,982,689


Scotweld Group Services Limited (Registered number: SC183317)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 July 2023

22. DIRECTORS' ADVANCES, CREDITS AND GUARANTEES

The following advances and credits to a director subsisted during the years ended 31 July 2023 and 31 July 2022:

2023 2022
£    £   
G Nixon
Balance outstanding at start of year (22,108 ) 43,652
Amounts advanced 94,290 21,724
Amounts repaid (100,000 ) (87,484 )
Amounts written off - -
Amounts waived - -
Balance outstanding at end of year (27,818 ) (22,108 )

23. RELATED PARTY DISCLOSURES

The company has taken the exemption available in the Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland ("FRS 102") not to disclose transactions with group companies that are included in the consolidated accounts of the company's parent undertaking, Scotweld Group Services Limited.

During the year, the group made sales of £9,821 (2022: £557) to companies under common directorship. In the same year, the entity made purchases of £409,885 (2022: £215,467) from the same companies. At the year end, these companies owed the group £5,329 (2022: £685). At the year end the group owed £30,143 (2022: £13,532) to these companies. These amounts are considered at arms length.

At the year end, the group owed £27,818 (2022: £22,108) to one of it's directors.

During the year, there were no compensations made to key management personnel other than directors.

24. ULTIMATE CONTROLLING PARTY

The ultimate controlling party is G Nixon.