Company registration number 04683556 (England and Wales)
ARGON & CO UK LIMITED GROUP OF COMPANIES
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
ARGON & CO UK LIMITED GROUP OF COMPANIES
COMPANY INFORMATION
Directors
Mr C J Mair
Mr I D Salamon
Mr J Laget
Company number
04683556
Registered office
137 Euston Road
LONDON
NW1 2AA
Auditor
Craufurd Hale Audit Services Limited
C/O Craufurd Hale Group
Ground Floor, Arena Court
Crown Lane
MAIDENHEAD
SL6 8QZ
Business address
137 Euston Road
LONDON
NW1 2AA
ARGON & CO UK LIMITED GROUP OF COMPANIES
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Company statement of cash flows
15
Notes to the financial statements
16 - 27
ARGON & CO UK LIMITED GROUP OF COMPANIES
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2023
- 1 -

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

Review of the business

Principal activities

Argon & Co UK Ltd (“the Company”) is a operations strategy and transformation consultancy, focussed on working with clients on a range of operations related topics.

The Company has expertise across all industries working with a range of large, multi-national blue-chip clients on both National and International project assignments.

Business review

The directors are pleased to report that 2023 has been a successful year with sales continuing to grow on the previous year, with revenue ending at £16.2m, representing 23.5% growth on 2022. Our operating profit remained healthy at £1,145,854 (2022: £1,563,108). The financial position of the balance sheet at the end of the year has increased as a result of these results.

Detailed results of the Company are set out in these financial statements.

Principal risks and uncertainties

The Company experiences a number of risks and uncertainties in the course of it’s business activities. The directors and management teams have responsibility to ensure that appropriate mitigations are in place for those risks identified. The directors and management teams believe that the risks identified below represent the principal risks that affect the business and could impact the businesses financial and operational activities.

People risk

As a consulting business, the Company relies on attracting and retaining highly experienced and qualified staff to provide services to clients. The loss of any key personnel, or a significant number of employees in a short period of time could have an impact on our ability to meet our obligations as set out in client contracts.

The directors recognise that people are key to the Company and therefore have ensured the right processes and procedures are in place to manage recruitment and staff development. This includes putting in place an appropriate budget for staff training and development.

Market risk

As a business-to-business service provider, economic uncertainty which impacts client’s budgets would have an adverse impact on revenue. A significant reduction in client demand would put pressure on consultant utilisation rates and effective day rates which could result in a financial loss for the Company.

The Company has a strong sales and account management process in place, with regular reviews to ensure that clients are being retained and grown where possible. Customer feedback surveys are targeted after the end of each project and bid process to ensure that key learnings are captured and clients are satisfied with the work delivered. This allows the Company to react quickly to changes in market demand to ensure that propositions are aligned to market conditions whilst still retaining high quality outputs.

Financial risk

Client fees are often paid on successful delivery of project engagements, which represents a risk if delivery is not of sufficient quality, or if the clients financial health deteriorates during the life of the project. Every project is assigned a Partner responsible for ongoing monitoring of this and a bid and risk process is conducted before entering into the contract. Where required, corrective action is taken promptly.

ARGON & CO UK LIMITED GROUP OF COMPANIES
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 2 -

Looking ahead

Looking ahead to 2024, the Company continues to expect further growth through offering a wider range of services to existing clients, reducing the cost of acquisition for each project. In addition, the company is focussing on core service offerings around strategy and transformation, which it expects to lead to longer and more profitable projects with clients.

In addition, the Group continues to look for new acquisitions to strengthen our global positioning; any new acquisitions in the UK will continue to be integrated into the Company to provide additional growth streams.

On behalf of the board

Mr C J Mair
Director
28 February 2024
ARGON & CO UK LIMITED GROUP OF COMPANIES
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2023
- 3 -

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

Directors

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

Mr C J Mair
Mr I D Salamon
Mr J Laget
Results and dividends

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors' insurance

The group maintains insurance policies on behalf of all the directors against liability arising from negligence, breach of duty and breach of trust in relation to the group.

Auditor

The auditor, Craufurd Hale Audit Services Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

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

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

ARGON & CO UK LIMITED GROUP OF COMPANIES
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 4 -
On behalf of the board
Mr C J Mair
Director
28 February 2024
ARGON & CO UK LIMITED GROUP OF COMPANIES
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ARGON & CO UK LIMITED GROUP OF COMPANIES
- 5 -
Opinion

We have audited the financial statements of Argon & Co UK Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 May 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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 group's and 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 included in the annual report, other than the financial statements and our auditor’s report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

 

Opinions on other matters prescribed by the Companies Act 2006

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

ARGON & CO UK LIMITED GROUP OF COMPANIES
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARGON & CO UK LIMITED GROUP OF COMPANIES
- 6 -
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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

ARGON & CO UK LIMITED GROUP OF COMPANIES
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARGON & CO UK LIMITED GROUP OF COMPANIES
- 7 -

Fraud and breaches of laws and regulations - ability to detect

Identifying and responding to risks of material misstatement due to fraud

 

To identify risks of material misstatement due to fraud ("fraud risks") we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:

- Enquiry of management and those charged with governance around actual and potential litigation and claims.

- Enquiry of entity staff in tax and compliance functions to identify any instances of non-compliance with laws and regulations.

- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.

- Using analytical procedures to identify any unusual or unexpected relationships.

- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.

 

We communicated identified fraud risks throughout the audit team and remained alert to any indications of fraud throughout the audit.

 

As required by auditing standards, and taking into account our overall knowledge of the control environment, we perform procedures to address the risk of management override of controls, in particular the risk that management may be in a position to make in appropriate accounting entries.

 

We did not identify any additional fraud risks.

 

We performed procedures including identifying journal entries to test based on risk criteria and comparing identified entries to supporting documentation. These included those posted to unrelated accounts, those posted containing key words, and those posted to an account linked to a fraud risk.

 

Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations

 

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience, and through discussions with the directors and other management (as required by auditing standards), and from inspection of the Company's regulatory and legal correspondence and discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations.

 

We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.

 

The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies legislation) and tax legislation, and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

 

We did not identify any others where the consequences of non-compliance alone could have a material effect on amounts or disclosures in the financial statements.

 

Context of the ability of the audit to detect fraud or breaches of law or regulation

 

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 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 fraud, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.

 

ARGON & CO UK LIMITED GROUP OF COMPANIES
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARGON & CO UK LIMITED GROUP OF COMPANIES
- 8 -

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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

Paul Fagan FCCA (Senior Statutory Auditor)
For and on behalf of Craufurd Hale Audit Services Limited
28 February 2024
Chartered Accountants
Statutory Auditor
C/O Craufurd Hale Group
Ground Floor, Arena Court
Crown Lane
MAIDENHEAD
SL6 8QZ
ARGON & CO UK LIMITED GROUP OF COMPANIES
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2023
- 9 -
2023
2022
Notes
£
£
Turnover
17,437,741
13,568,163
Cost of sales
(2,080,375)
(322,512)
Gross profit
15,357,366
13,245,651
Contractors
(763,414)
(819,900)
Administrative expenses
(13,673,951)
(10,978,596)
Other operating income
2,934
77,745
Operating profit
922,935
1,524,900
Interest receivable and similar income
2,968
122
Interest payable and similar expenses
(85)
(852)
Profit before taxation
925,818
1,524,170
Tax on profit
6
(271,598)
(303,411)
Profit for the financial year
654,220
1,220,759
Other comprehensive income
Currency translation differences
2,223
(3,015)
Total comprehensive income for the year
656,443
1,217,744
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
ARGON & CO UK LIMITED GROUP OF COMPANIES
GROUP BALANCE SHEET
AS AT
31 MAY 2023
31 May 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
7
1,802,659
2,224,267
Tangible assets
8
116,997
188,410
1,919,656
2,412,677
Current assets
Debtors
12
6,863,009
4,720,812
Cash at bank and in hand
1,503,910
589,369
8,366,919
5,310,181
Creditors: amounts falling due within one year
13
(6,511,635)
(4,604,361)
Net current assets
1,855,284
705,820
Net assets
3,774,940
3,118,497
Capital and reserves
Called up share capital
15
321
321
Share premium account
127,823
127,823
Capital redemption reserve
115
115
Other reserves
(25,784)
(28,007)
Profit and loss reserves
3,672,465
3,018,245
Total equity
3,774,940
3,118,497
The financial statements were approved by the board of directors and authorised for issue on 28 February 2024 and are signed on its behalf by:
28 February 2024
Mr C J Mair
Director
Company registration number 04683556 (England and Wales)
ARGON & CO UK LIMITED GROUP OF COMPANIES
COMPANY BALANCE SHEET
AS AT 31 MAY 2023
31 May 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
7
1,802,659
2,224,267
Tangible assets
8
111,910
185,313
Investments
9
5,135
5,135
1,919,704
2,414,715
Current assets
Debtors
12
6,827,002
4,795,492
Cash at bank and in hand
1,279,642
534,520
8,106,644
5,330,012
Creditors: amounts falling due within one year
13
(6,398,147)
(4,582,219)
Net current assets
1,708,497
747,793
Net assets
3,628,201
3,162,508
Capital and reserves
Called up share capital
15
321
321
Share premium account
127,823
127,823
Capital redemption reserve
115
115
Profit and loss reserves
3,499,942
3,034,249
Total equity
3,628,201
3,162,508

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £465,692 (2022 - £1,259,919 profit).

The financial statements were approved by the board of directors and authorised for issue on 28 February 2024 and are signed on its behalf by:
28 February 2024
Mr C J Mair
Director
Company registration number 04683556 (England and Wales)
ARGON & CO UK LIMITED GROUP OF COMPANIES
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
- 12 -
Share capital
Share premium account
Capital redemption reserve
Foreign exchange reserve
Profit and loss reserves
Total
£
£
£
£
£
£
Balance at 1 June 2021
321
127,823
115
(24,992)
1,797,486
1,900,753
Year ended 31 May 2022:
Profit for the year
-
-
-
-
1,220,759
1,220,759
Other comprehensive income:
Currency translation differences
-
-
-
-
(3,015)
(3,015)
Total comprehensive income
-
-
-
-
1,217,744
1,217,744
Transfers
-
-
-
(3,015)
3,015
-
Balance at 31 May 2022
321
127,823
115
(28,007)
3,018,245
3,118,497
Year ended 31 May 2023:
Profit for the year
-
-
-
-
654,220
654,220
Other comprehensive income:
Currency translation differences
-
-
-
-
2,223
2,223
Total comprehensive income
-
-
-
-
656,443
656,443
Transfers
-
-
-
2,223
(2,223)
-
Balance at 31 May 2023
321
127,823
115
(25,784)
3,672,465
3,774,940
ARGON & CO UK LIMITED GROUP OF COMPANIES
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
- 13 -
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 June 2021
321
127,823
115
1,774,330
1,902,589
Year ended 31 May 2022:
Profit and total comprehensive income for the year
-
-
-
1,259,919
1,259,919
Balance at 31 May 2022
321
127,823
115
3,034,249
3,162,508
Year ended 31 May 2023:
Profit and total comprehensive income
-
-
-
465,693
465,693
Balance at 31 May 2023
321
127,823
115
3,499,942
3,628,201
ARGON & CO UK LIMITED GROUP OF COMPANIES
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2023
- 14 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
19
1,188,564
1,171,832
Interest paid
(85)
(852)
Income taxes paid
(238,624)
(92,897)
Net cash inflow from operating activities
949,855
1,078,083
Investing activities
Purchase of intangible assets
-
(1,939,923)
Purchase of tangible fixed assets
(33,918)
(142,795)
Proceeds from disposal of tangible fixed assets
358
84
Interest received
2,968
122
Net cash used in investing activities
(30,592)
(2,082,512)
Financing activities
Payment of finance leases obligations
(6,945)
(25,003)
Net cash used in financing activities
(6,945)
(25,003)
Net increase/(decrease) in cash and cash equivalents
912,318
(1,029,432)
Cash and cash equivalents at beginning of year
589,369
1,621,816
Effect of foreign exchange rates
2,223
(3,015)
Cash and cash equivalents at end of year
1,503,910
589,369
ARGON & CO UK LIMITED GROUP OF COMPANIES
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
20
1,016,600
1,148,906
Interest paid
(85)
(852)
Income taxes paid
(238,624)
(92,840)
Net cash inflow from operating activities
777,891
1,055,214
Investing activities
Purchase of intangible assets
-
0
(1,939,923)
Purchase of tangible fixed assets
(29,150)
(139,414)
Proceeds from disposal of tangible fixed assets
358
84
Interest received
2,968
122
Net cash used in investing activities
(25,824)
(2,079,131)
Financing activities
Payment of finance leases obligations
(6,945)
(25,003)
Net cash used in financing activities
(6,945)
(25,003)
Net increase/(decrease) in cash and cash equivalents
745,122
(1,048,920)
Cash and cash equivalents at beginning of year
534,520
1,583,440
Cash and cash equivalents at end of year
1,279,642
534,520
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
- 16 -
1
Accounting policies
Company information

Argon & Co (UK) Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 137 Euston Road, LONDON, NW1 2AA.

 

The group consists of Argon & Co (UK) Limited and all of its subsidiaries.

1.1
Accounting convention

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

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

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

1.2
Basis of consolidation

The consolidated financial statements incorporate those of Argon & Co UK Limited (formerly known as Crimson Consulting (UK) Limited and all of its subsidiaries) (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits).

 

All financial statements included in the consolidation are made up to 31 May 2023.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation.

1.3
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.4
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion can be estimated reliably.

1.5
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 to 10 years.

1.6
Tangible fixed assets

Tangible fixed assets are measured at cost and subsequently measured at cost, net of depreciation.

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

Plant and equipment
25% - 40% straight line
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 17 -

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.7
Fixed asset investments

In the parent company financial statements investments in subsidiaries are measured at cost .

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.8
Cash and cash equivalents

Cash at bank and in hand are basic financial assets and represents cash held at banks.

1.9
Financial instruments

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

 

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

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are measured at transaction price including transaction costs.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, are recognised at transaction price including transaction costs.

 

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. Trade creditors are recognised at transaction price.

Other financial liabilities

Forward foreign exchange contracts, are not basic financial instruments. Forward foreign exchange contracts are initially recognised at fair value on the date a forward foreign exchange contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of forward foreign exchange contract are recognised in profit or loss in finance costs or finance income as appropriate.

1.10
Equity instruments

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

1.11
Taxation

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

ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 18 -
Current tax

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

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense.

 

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

1.13
Retirement benefits

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

1.14
Leases

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

 

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

Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease.

1.15
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.

1.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the profit and loss account for the period.

ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 19 -
2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

 

 

3
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
8,685
7,500
4
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
96
73
90
69

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
8,579,830
7,222,394
8,120,484
6,866,691
Social security costs
960,318
659,776
960,011
657,524
Pension costs
951,751
679,477
921,865
661,098
10,491,899
8,561,647
10,002,360
8,185,313
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 20 -
5
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
291,677
271,336
Company pension contributions to defined contribution schemes
2,559
1,873
294,236
273,209
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Company pension contributions to defined contribution schemes
1
1
6
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
255,254
287,019
Adjustments in respect of prior periods
-
0
348
Total UK current tax
255,254
287,367
Foreign current tax on profits for the current period
16,344
16,044
Total current tax
271,598
303,411

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

2023
2022
£
£
Profit before taxation
925,818
1,524,170
Expected tax charge based on the standard rate of corporation tax in the UK of 20.00% (2022: 19.00%)
185,164
289,592
Tax effect of expenses that are not deductible in determining taxable profit
6,809
2,761
Permanent capital allowances in excess of depreciation
13,069
(18,393)
Amortisation on assets not qualifying for tax allowances
83,722
43,311
Effect of overseas tax rates
(17,166)
20,691
Under/(over) provided in prior years
-
0
348
Reserch and development claim
-
0
(34,899)
Taxation charge
271,598
303,411
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 21 -
7
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 June 2022
3,078,363
Disposals
(3,000)
At 31 May 2023
3,075,363
Amortisation and impairment
At 1 June 2022
854,096
Amortisation charged for the year
418,608
At 31 May 2023
1,272,704
Carrying amount
At 31 May 2023
1,802,659
At 31 May 2022
2,224,267
Company
Goodwill
£
Cost
At 1 June 2022
3,078,363
Disposals
(3,000)
At 31 May 2023
3,075,363
Amortisation and impairment
At 1 June 2022
854,096
Amortisation charged for the year
418,608
At 31 May 2023
1,272,704
Carrying amount
At 31 May 2023
1,802,659
At 31 May 2022
2,224,267
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 22 -
8
Tangible fixed assets
Group
Plant and equipment
£
Cost
At 1 June 2022
462,701
Additions
33,918
Disposals
(727)
At 31 May 2023
495,892
Depreciation and impairment
At 1 June 2022
274,291
Depreciation charged in the year
104,968
Eliminated in respect of disposals
(364)
At 31 May 2023
378,895
Carrying amount
At 31 May 2023
116,997
At 31 May 2022
188,410
Company
Plant and equipment
£
Cost
At 1 June 2022
454,652
Additions
29,150
Disposals
(727)
At 31 May 2023
483,075
Depreciation and impairment
At 1 June 2022
269,339
Depreciation charged in the year
102,190
Eliminated in respect of disposals
(364)
At 31 May 2023
371,165
Carrying amount
At 31 May 2023
111,910
At 31 May 2022
185,313
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 23 -
9
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
10
-
0
-
0
5,135
5,135
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 June 2022 and 31 May 2023
5,135
Carrying amount
At 31 May 2023
5,135
At 31 May 2022
5,135
10
Subsidiaries

Details of the company's subsidiaries at 31 May 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Crimson Consulting (Singapore) Pte. Ltd
Singapore
Ordinary
100.00
11
Financial instruments
12
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,962,048
2,505,882
2,730,037
2,478,586
Amounts owed by group undertakings
3,204,382
1,844,475
3,448,840
1,960,361
Other debtors
2,000
1,000
2,000
1,000
Prepayments and accrued income
694,579
369,455
646,125
355,545
6,863,009
4,720,812
6,827,002
4,795,492
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 24 -
13
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
(14,393)
(7,448)
(14,393)
(7,448)
Trade creditors
546,945
475,954
508,074
474,497
Amounts owed to group undertakings
4,297,334
2,416,474
4,297,334
2,416,474
Corporation tax payable
319,771
286,797
310,218
286,797
Other taxation and social security
512,858
370,475
500,179
369,085
Deferred income
89,165
159,395
89,165
159,395
Other creditors
2,476
-
0
-
0
-
0
Accruals
757,479
902,714
707,570
883,419
6,511,635
4,604,361
6,398,147
4,582,219

Included in other creditors are finance leases totalling £nil (2022 - £2,741) that are secured over the related assets.

14
Retirement benefit schemes

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

Contributions totalling £80,814 (2022 - £67,588) were payable to the fund at the reporting date.

15
Share capital
Group and company
2023
2022
Ordinary share capital
£
£
Issued and fully paid
32,090 Ordinary £0.01 shares of 1p each
321
321

The shares have attached to them full voting, dividend and capital distribution (including on winding up) rights; they do not confer any rights of redemption.

ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 25 -
16
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
172,283
94,163
172,283
94,163
Between two and five years
216,753
264,922
216,753
264,922
389,036
359,085
389,036
359,085
17
Related party transactions
Remuneration of key management personnel

In addition to the directors whose remuneration is disclosed in note 7 of the financial statements, key management personnel are regarded as the finance director and the managing directors. The gross remuneration of key management personnel is as follows:

2023
2022
£
£
Aggregate compensation
651,186
623,295
18
Parent company

Argon & Co UK Limited (UK) Limited) is a wholly-owned subsidiary of Argon & Co, a company incorporated in France.

ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 26 -
19
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
654,220
1,220,759
Adjustments for:
Taxation charged
271,598
303,411
Finance costs
85
852
Investment income
(2,968)
(122)
Loss on disposal of tangible fixed assets
5
462
Amortisation and impairment of intangible assets
418,608
227,954
Depreciation and impairment of tangible fixed assets
104,968
86,275
Movements in working capital:
Increase in debtors
(2,142,197)
(2,013,691)
Increase in creditors
1,954,475
1,220,139
(Decrease)/increase in deferred income
(70,230)
125,793
Cash generated from operations
1,188,564
1,171,832
20
Cash generated from operations - company
2023
2022
£
£
Profit for the year after tax
465,693
1,259,919
Adjustments for:
Taxation charged
262,045
303,189
Finance costs
85
852
Investment income
(2,968)
(122)
Loss on disposal of tangible fixed assets
5
462
Amortisation and impairment of intangible assets
418,608
227,954
Depreciation and impairment of tangible fixed assets
102,190
84,178
Movements in working capital:
Increase in debtors
(2,031,510)
(2,066,431)
Increase in creditors
1,872,682
1,213,112
(Decrease)/increase in deferred income
(70,230)
125,793
Cash generated from operations
1,016,600
1,148,906
ARGON & CO UK LIMITED GROUP OF COMPANIES
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 27 -
21
Analysis of changes in net funds - group
1 June 2022
Cash flows
31 May 2023
£
£
£
Cash at bank and in hand
589,369
914,541
1,503,910
Obligations under finance leases
7,448
6,945
14,393
596,817
921,486
1,518,303
22
Analysis of changes in net funds - company
1 June 2022
Cash flows
31 May 2023
£
£
£
Cash at bank and in hand
534,520
745,122
1,279,642
Obligations under finance leases
7,448
6,945
14,393
541,968
752,067
1,294,035
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