REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
FOR |
ASSOCIATED CONTINUITY TEAMS LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
FOR |
ASSOCIATED CONTINUITY TEAMS LIMITED |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Income Statement | 10 |
Balance Sheet | 11 |
Statement of Changes in Equity | 12 |
Notes to the Financial Statements | 13 |
ASSOCIATED CONTINUITY TEAMS LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 MAY 2023 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants |
The Lightbox |
87 Castle Street |
Reading |
Berkshire |
RG1 7SN |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MAY 2023 |
The directors present their strategic report for the year ended 31 May 2023. |
REVIEW OF BUSINESS |
The Company's key performance indicators include revenue, operating profit, gross profit, gross profit percentage and administrative expenses, each of which is discussed in detail later in the report. |
The year ended 31 May 2023 has been clear of the impact of the Covid pandemic and unaffected by lockdowns and trading has consistently and steadily increased over the year and the directors are satisfied with the reported level of revenue and trading profitability for the year. |
The Company is part of a group headed by Associated Continuity Teams Holdings Limited, which during the year ended 31 May 2021 the Group secured new bank funding through the governments CBILS initiative. Trading levels, profitability and cash generation have since exceeded the forecast prepared in agreeing the new funding and the Group has comfortably met all repayments and obligations of the funding. |
The Company agreed a formal Time to Pay Arrangement with HMRC on PAYE & VAT payments deferred at the start of the Covid 19 pandemic. The Arrangement has been fully complied with and the full liability for deferred payments has been settled during the year end |
The directors are confident of further recovery in activity, expecting increased revenues and profitability in future years. |
PRINCIPAL RISKS AND UNCERTAINTIES |
UK Economy |
The 2016 referendum vote for the UK to leave the European Community may eventually impact the level of net migration into the UK, through the full impact cannot be assessed. The Company is confident that in the current competitive market for staff recruitment, that its recruitment channels and systems will continue to ensure its success in attracting new employees. |
Liquidity risk |
The business is in part funded by loans from other group companies and invoice discounting facility. The loans and invoice discounting facility were agreed in May 2021. The Company has operated well within the total amount of the available facility and the directors are confident that all future obligations will be met. |
Market risk |
The Company continues to develop its skills offerings and understanding and improving service levels to clients as we feel these are vital to the management and mitigation of market risks. |
Human Resources |
The business has continually developed its human resource recruitment and payroll systems and will continue to do so. This will improve reliability and efficiency in the volume processing of staff. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 MAY 2023 |
ENGAGEMENT WITH EMPLOYEES |
The Company places considerable value on the involvement of its employees and continues to keep them informed on matters affecting them as employees and on the various factors affecting the performance of the Company. |
The Company has a policy of continuous improvement at all levels throughout the business and actively seeks to promote advancement of front line staff to supervisor and management positions, both within the operations team and into the support teams. |
We have a strong diversity culture and employ people from a large number of countries and ethnic backgrounds. |
DISABLED EMPLOYEES |
Applications for employment by disabled persons are always fully considered, bering in mind the abilities of the applicant concerned. In the event of members of staff becoming disabled every effort is made to ensure that their employment with the Company continues and that appropriate training is arranged. It is the policy of the Company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees. |
FINANCIAL KEY PERFORMANCE INDICATORS |
Revenue has increased in the year, gross profit and gross profit percentage decreased. |
2023 | 2022 |
Revenue | 13,010,826 | 10,779,488 |
Gross profit margin | 19.6% | 21.8% |
Administration expenses | 2,077,697 | 1,817,577 |
During the year the trading company received credits from HMRC under the Job Retention Scheme of £Nil (2022: £7,694) which are reported in other income. |
Administrative expenses reduced to 15.9% of revenue (2022: 16.9%). |
ON BEHALF OF THE BOARD: |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 MAY 2023 |
The directors present their report with the financial statements of the company for the year ended 31 May 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of providing cleaning and support services to the luxury hospitality sector. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 May 2023. |
FUTURE DEVELOPMENTS |
With the Group having restructured its bank debt in the year to 31 May 2021 and in the year to 31 May 2022 having agreed the waiver of the Investor and Management Loan notes, the Group is well positioned to deliver further revenue, profit growth and cash generation. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 June 2022 to the date of this report. |
GOING CONCERN |
The Company is part of a group headed by Associated Continuity Teams Holdings Limited. Financing within the Group is secured through a cross-guarantee over the assets of the Group. Accordingly, the going concern assessment has been undertaken by the directors for the Group as a whole. |
As the country recovered from the Covid-19 pandemic, the Group secured new bank funding via the Governments CBILS facilities in May 2021. In addition to the CBILS facilities the Group has agreed with its bankers an invoice discounting facility sufficient to fund working capital increase as future trading activity increases |
During the year ended 31 May 2023, the level of trading profitability and cash generation exceeded that assumed in the post recovery forecast and the Group has passed all banking covenant tests. The current levels of trading and profitability is sufficient to ensure future bank covenant tests will be passed even with no further recovery. |
Whilst there is now some uncertainty relating to future trading due to the current UK economic position. The directors have completed a conservative set of forecasts based on no improvement to current trading levels that show that the Group will be able to meet liabilities as they fall due, the Group will not breach its bank covenants. |
The directors believe that they have a strong relationship with investors and bankers and therefore should a scenario worse that the conservative scenario present itself, amended terms of funding would be agreed with the Group's bankers or new financing arrangements obtained to allow the business to continue to trade. |
The directors therefore continue to adopt the going concern basis of accounting in preparing these financial statements. The financial statements do not include the adjustments that would result if the Group and Company were unable to continue as a going concern. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 MAY 2023 |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the 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 of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT 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 company'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 company's auditors are aware of that information. |
AUDITORS |
The auditors, Haines Watts, Statutory Auditor, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ASSOCIATED CONTINUITY TEAMS LIMITED |
Opinion |
We have audited the financial statements of Associated Continuity Teams Limited (the 'company') for the year ended 31 May 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and 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 company's affairs as at 31 May 2023 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other matters |
The financial statements of the Company for the year-ended 31 May 2022 were audited by another auditor who expressed an unmodified opinion of those statements on 20 December 2022. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the 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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ASSOCIATED CONTINUITY TEAMS LIMITED |
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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the 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, 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. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page five, 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 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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ASSOCIATED CONTINUITY TEAMS 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: |
We obtained an understanding of the legal and regulatory framework applicable to the Company and the industry in which it operates. We determined that the following laws and regulations were most significant: FRS102 - the Financial Reporting Standard applicable in the UK & The Republic of Ireland, the Companies Act 2006 and relevant tax compliance regulations in the UK. |
We obtained an understanding of how the Company is complying with those legal and regulatory frameworks by making enquiries of management. |
We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur, by meeting with management to understand where management considered there was susceptibility to fraud. Audit procedures performed by the audit team included: |
- Challenging assumptions and judgements made by management in its significant accounting estimates; |
- Identifying and testing journal entries, with a focus on entries made with unusual accounting combinations; |
- Confirming with management whether they have knowledge of any actual, suspected or illegal fraud; |
- Evaluating whether there was evidence of bias by management that represents a risk of material |
misstatement due to fraud. |
These procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. |
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance will all laws and regulations. |
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 |
ASSOCIATED CONTINUITY TEAMS 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. |
for and on behalf of |
Chartered Accountants |
The Lightbox |
87 Castle Street |
Reading |
Berkshire |
RG1 7SN |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31 MAY 2023 |
2023 | 2022 |
Notes | £ | £ |
TURNOVER | 4 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
478,458 | 529,897 |
Other operating income | 5 |
OPERATING PROFIT | 7 |
Interest payable and similar expenses | 9 |
PROFIT BEFORE TAXATION |
Tax on profit | 10 |
PROFIT FOR THE FINANCIAL YEAR |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
BALANCE SHEET |
31 MAY 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
CURRENT ASSETS |
Debtors | 12 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 15 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 16 |
Retained earnings | 17 |
SHAREHOLDERS' FUNDS |
The financial statements were approved and authorised for issue by the Board of Directors and authorised for issue on |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 MAY 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 June 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 May 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 May 2023 |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MAY 2023 |
1. | STATUTORY INFORMATION |
Associated Continuity Teams Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirement of paragraph 3.17(d); |
• | the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); |
• | the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A; |
• | the requirement of paragraph 33.7. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
2. | ACCOUNTING POLICIES - continued |
Revenue |
Revenue 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, value added tax and other sales taxes. Revenue comprises revenue recognised by the Company in respect of the provision of support services during the year. |
The Company provides services on both fixed and variable contracts with revenue recognised as the services are delivered. Variable contracts are set on agreed charge rates per hour and the hours agreed weekly with customers. Fixed Contracts are agreed in advance with customers and a fixed price charged for the services delivered against an agreed service specification. Actual hours delivered are consistently monitored and variances regularly investigated. The majority of customers are invoiced on a weekly basis. |
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 the following conditions are satisfied: |
- | the amount of revenue can be measured reliably |
- | it is probable that the Company will received the consideration due under the contract; and |
- | the stage of completion of the contract at the end of the reporting period can be measured reliably |
Going concern |
The Company is part of a group headed by Associated Continuity Teams Holdings Limited. Financing within the Group is secured through a cross-guarantee over the assets of the Group. Accordingly, the going concern assessment has been undertaken by the directors for the Group as a whole. |
As the country recovered from the Covid-19 pandemic, the Group secured new bank funding via the Governments CBILS facilities in May 2021. In addition to the CBILS facilities the Group has agreed with its bankers an invoice discounting facility sufficient to fund working capital increase as future trading activity increases |
During the year ended 31 May 2023, the level of trading profitability and cash generation exceeded that assumed in the post recovery forecast and the Group has passed all banking covenant tests. The current levels of trading and profitability is sufficient to ensure future bank covenant tests will be passed even with no further recovery. |
Whilst there is now some uncertainty relating to future trading due to the current UK economic position. The directors have completed a conservative set of forecasts based on no improvement to current trading levels that show that the Group will be able to meet liabilities as they fall due, the Group will not breach its bank covenants. |
The directors believe that they have a strong relationship with investors and bankers and therefore should a scenario worse that the conservative scenario present itself, amended terms of funding would be agreed with the Group's bankers or new financing arrangements obtained to allow the business to continue to trade. |
The directors therefore continue to adopt the going concern basis of accounting in preparing these financial statements. The financial statements do not include the adjustments that would result if the Group and Company were unable to continue as a going concern. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
Depreciation is charged so as to allocated the cost of the assets less their residual value over their estimated useful lives, using the straight-line method. |
Depreciation is provided on the following basis: |
Plant and machinery | - 20% straight line |
Fixtures and fittings | - 20% straight line |
Computer equipment | - 33% straight line |
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. |
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the income statement. |
Government grants |
Grants are recognised only when there is a reasonable assurance that the Group will comply with the conditions attached to them and that the grants will be received. Grants that are receivable for expenses already incurred are recognised in the profit or loss in the period in which they become receivable. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 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 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 trade and other 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 financial asset is measured at the present value of the future receipts |
discounted at a market rate of interest. |
Basic financial liabilities |
Basic financial liabilities, including trade and other creditors and amounts owed to group undertakings are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value fo the future payments discounted at a market rate of interest. |
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. |
Debtors |
Short term debtors are measured at transaction price, less any impairment. Loans receivable are |
measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment. |
Cash and cash equivalents |
Cash and cash equivalents are basic financial instruments and include cash in hand, deposits held at call with banks and other short term liquid investments with original maturities of three months or |
less. |
Creditors |
Short term creditors are measured at the transaction price. Other financial liabilities, include bank |
loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortized cost using the effective interest method. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, 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 balance sheet date. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
2. | ACCOUNTING POLICIES - continued |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet 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. |
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. |
Dividends |
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting. |
Holiday pay accrual |
A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the balance sheet date. |
Provisions for liabilities |
Provisions are made when an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and reliable estimate can be made of the amount of the obligation. |
Provisions are charged as an expense to the Income Statement in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. |
When payments are eventually made, they are charged to the provision carried in the balance sheet. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
3. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
The preparation of financial statements in conformity with generally accepted accepted accounting practice requires management to make estimates and judgements that affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the reported period. |
Judgements |
Financial instruments classification |
The classification of financial instruments as "basic" or "other" requires judgement as to whether all the applicable conditions for classification as basic are met. This includes consideration of the form of the instrument and its return. |
Key sources of estimation uncertainty |
Holiday pay accrual |
The Company operates an on-line holiday booking system allowing each employee to book holiday which is then approved by operational management before processed. Each employee has a unique holiday reference year. at the balance sheet date the Company has visibility of accrued holiday entitlements for each employee. Based upon monitored holiday statistics a provision is calculated and included in the balance sheet against the estimated cost of earner unused holiday at the year end. |
Bad debt provisions |
The trade debtor balance of £1,700,162 (2022: £1,700,334) recorded in the Company's balance sheet comprises a relatively large number of small balances. A full line by line review of trade debtors is carried out at the end of each month. Whilst every attempt is made to ensure that the bad debt provisions are as accurate as possible, there remains a risk that the provision do not match the level of debts which ultimately prove to be uncollectible. |
4. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by class of business is given below: |
2023 | 2022 |
£ | £ |
All turnover arose within the United Kingdom. |
5. | OTHER OPERATING INCOME |
2023 | 2022 |
£ | £ |
Other income |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
6. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Management | 18 | 14 |
Non-management | 548 | 419 |
2023 | 2022 |
£ | £ |
Directors' remuneration |
All directors are employed and paid by Associated Continuity Teams Bidco Limited. |
7. | OPERATING PROFIT |
The operating profit is stated after charging: |
2023 | 2022 |
£ | £ |
Depreciation - owned assets |
Other operating lease rentals |
Defined contribution pension cost |
8. | AUDITORS' REMUNERATION |
2023 | 2022 |
£ | £ |
Fees payable to the company's auditors for the audit of the company's financial statements |
20,000 |
41,700 |
Auditors' remuneration for non audit work |
9. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Bank interest |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
10. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax |
Adjustments in prior year | (3,171 | ) | (261 | ) |
Total current tax |
Deferred tax |
Tax on profit |
UK corporation tax has been charged at 20% . |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Depreciation in excess of capital allowances |
Adjustments to tax charge in respect of previous periods | ( |
) |
Change in tax rates | - | 1,693 |
Deferred tax not recognised | (20,430 | ) | (7,395 | ) |
Group relief surrendered | - | 2 |
Other difference | (1,119 | ) | - |
Total tax charge | 84,818 | 100,607 |
As of 1 April 2023, the UK Government has increased the main rate of corporation tax from 19% to 25%. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
11. | TANGIBLE FIXED ASSETS |
Fixtures |
Plant and | and | Computer |
machinery | fittings | equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 June 2022 |
Additions |
At 31 May 2023 |
DEPRECIATION |
At 1 June 2022 |
Charge for year |
At 31 May 2023 |
NET BOOK VALUE |
At 31 May 2023 |
At 31 May 2022 |
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Tax |
Prepayments and accrued income |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade creditors |
Tax |
Social security and other taxes |
Amount owed to related parties | 91,568 | 165,971 |
Accruals and deferred income |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
14. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
Financial Commitments |
During the year ended 31 May 2021 the group headed by Associated Continuity Teams Holdings Limited has restructured its bank loan funding, repaying all existing bank loans and obtaining new funding via the Governments CBILS scheme and an Invoice Discounting Facility secured against the Group Trade Debtors. |
The CBILS loan of £1,500,000 was drawn on 27 May 2021. The loan is repayable by 20 consecutive instalments of £75,000 payable each quarter with the first repayment on 31 May 2022. Interest is charged at a margin of 3.8% plus Base Rate. |
The balance of the loan at 31 May 2023 was £1,125,000. |
15. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
£ | £ |
Deferred tax | 5,200 | - |
Deferred tax |
£ |
Provided during year |
Balance at 31 May 2023 |
16. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary A | £0.0004 | 400 | 400 |
Ordinary G | £0.05 | 63 | 63 |
Ordinary H | £0.05 | 62 | 62 |
525 | 525 |
The G and H Ordinary shares receive no dividend and have no voting rights. |
17. | RESERVES |
Retained earnings relates to the cumulative profit or loss, less amounts distributed to shareholders. |
ASSOCIATED CONTINUITY TEAMS LIMITED (REGISTERED NUMBER: 05807304) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MAY 2023 |
18. | PENSION COMMITMENTS |
The Company operate a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £164,777 (2022 - £128,417) and £4,264 of contributions were payable at the balance sheet date (2022 - £5,532) |
19. | RELATED PARTY DISCLOSURES |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
At the year end, the company owed £91,568 (2022 - £165,971) to Connection Capital LLP in respect of invoices processed on behalf of other group companies. |
Compensation to key management personnel is paid by other group companies and the company is charged in return through management fees. |
20. | ULTIMATE CONTROLLING PARTY |
Associated Continuity Teams Bidco Limited is the immediate parent company of Associated Continuity Teams Limited and Associated Continuity Teams Holdings Limited is the ultimate parent. |
The largest group in which the results of the company are consolidated is that headed by Associated Continuity Teams Holdings Limited, whose registered address is Unit WG01 Vox Studios, 1-45 Durham Street, London, SE11 5JH. |
The consolidated accounts of Associated Continuity Teams Holdings Limited are available to the public and may be obtained from Companies House, Crown Way, Cardiff. No other group accounts include the results of the company, |
In the opinion of the directors the ultimate controlling party of this company is Connection Capital LLP, a limited liability partnership incorporated in England and Wales whose registered address is One Eleven, Edmund Street, Birmingham, B3 2HJ. |