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Stephenson Group Ltd

Registered number: 00068499
Annual report and financial statements
For the year ended 30 September 2023

 
STEPHENSON GROUP LIMITED
 
 
COMPANY INFORMATION


Directors
T R Bentley 
T J M Bentley 
J M Story 
R L Carr 
L Flannery 
L Bilbrough (appointed 1 January 2023)
S Bradley (appointed 1 January 2024)




Registered number
00068499



Registered office
Brookfoot House
Low Lane

Horsforth

Leeds

West Yorkshire

LS18 5PU




Independent auditor
Mazars LLP
Chartered Accountants & Statutory Auditor

5th Floor

3 Wellington Place

Leeds

LS1 4AP




Bankers
Barclays Bank Plc
10 Market Street

Bradford

West Yorkshire





 
STEPHENSON GROUP LIMITED
 

CONTENTS



Page
Strategic Report
 
 
1 - 3
Directors' Report
 
 
4 - 5
Independent Auditor's Report
 
 
6 - 9
Statement of Comprehensive Income
 
 
10
Statement of Financial Position
 
 
11
Statement of Changes in Equity
 
 
12
Notes to the Financial Statements
 
 
13 - 34

 
STEPHENSON GROUP LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023

Introduction
 
The directors present the strategic report for the year ended 30 September 2023.
Principal Activities
The principal activity of the Company is the development, manufacture and supply of specialty chemicals.
Business model
Stephenson Group Limited (“Stephenson”) manufactures and supplies specialty personal care ingredients and solutions. With over 100 years of experience supplying chemicals and soap bases, Stephenson has significant expertise in the areas in which it operates. 80% of Stephenson sales are to export markets, with a sizable presence in the US and Europe.
Stephenson innovates, develops, and manufactures quality technical products for a range of applications from its research and development and manufacturing facilities.

Business review and results
 
The business environment in fiscal year 2023 was significantly more challenging than the prior two years. Raw Material price inflation and destocking by key customers led to a reduction in both sales and profitability. Good cost control within the business and a sharp focus on stock and gross margin management resulted in a cash position improved over prior year and a creditable operating profit.
In the year ended 30 September 2023, Stephenson sales were £26,971k vs the prior year of £34,790k and the business recorded an operating profit of £2,493k vs £3,681k in the previous period.  Gross profit margins increased 2% on the previous year to 38% due to slightly more favourable exchange rates and improved product mix.
Increasingly the business is focusing on sustainable innovation and has invested significantly in both the development of innovative products to meet this aim as well as creating a business culture to drive change through the Company and work with our supply chain in using sustainable raw materials.

Financial key performance indicators
 
The directors consider the key financial KPI’s to be:
Sales growth and order intake
Customer and product profitability
Operation cost measures, including purchase price variances
Debt levels
Working capital levels
Debtor and Creditor days analysis
 
Other key performance indicators
 
In addition, non-financial KPI’s include:
Health & Safety compliance
Customer retention analysis
Quality control metrics
Operations measures
Environmental Impact

- 1 -

 
STEPHENSON GROUP LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023

Principal risks and uncertainties
 
Exchange rate risk
A significant proportion of Stephenson’s sales are exported and are priced in either Euros or US dollars. Accordingly, the Company has significant accounts receivable in these currencies. The exchange rate risk is managed by forward contracts, where appropriate. In addition, the Company is increasingly purchasing key raw materials in currency and has the necessary banking facilities to create a natural hedge and mitigate the impact of foreign currency fluctuations.
Credit risk
The Company’s principal financial assets are stock and trade debtors that represent the Company’s main exposure to credit risk in relation to financial assets.
The credit risk is primarily attributable to its trade debtors. The risk is managed by maintaining a strict credit policy and effective credit rating of prospective customers. In addition, the Company has a credit insurance policy in place which covers the majority of trade receivables.
Operational risk
The Company has solid reporting systems and produces timely and accurate management information which is regularly reviewed by the directors and other stakeholders.
Price risk
The Company is exposed to pressure on margins, with a number of raw materials being commodities and as such susceptible to volatility which could impact on margins. Stephenson has contracts with suppliers to mitigate price fluctuations where possible.
Liquidity risk
The Company has sufficient banking facilities in place to meet its current and future working capital. 
Future developments
The environmental benefits of significantly reducing plastic packaging and water content is driving increasing consumer interest in solid format personal care products. The Company has ambitious plans to expand the range of solid format products, the opportunity for growth is significant and helps focus the business toward the sustainable goals it is striving to achieve.
Our focus on personal care is now allowing the business to invest in new opportunities and concentrate our efforts on core strategies. There are a number of new products in the pipeline, which are already showing signs of significant growth, and a substantial investment has been made in both R&D and capital equipment to enable this
 
- 2 -

 
STEPHENSON GROUP LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023

Corporate social responsibility
Our corporate social responsibility plans fall into three distinct categories. Our culture and looking after our people and their families, our community through support for charities and education and our sustainability strategy.
Sustainability is at the forefront of what we do and has been for many years. We are working with external agencies to assess our impact on Packaging, Net Zero and our supply chain and raw materials, and to understand our impact better and set realistic targets. We continue to champion the use of sustainable Palm Oil, and work hard with suppliers to source more of our materials from responsible sources.
Our new product development is primarily focused on solid format personal care products. These have a low carbon footprint, are concentrated so reducing water usage, and packaged in sustainable materials supporting the challenge of eliminating single use plastic.


This report was approved by the board on 26 February 2024 and signed on its behalf.


T J M Bentley
Director
- 3 -

 
STEPHENSON GROUP LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023

The Directors present their report and the financial statements for the year ended 30 September 2023.

Directors' responsibilities statement

The Directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the Directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £2,032,523 (2022 - £2,958,437).

Dividends of £1,260,000 (2022 - £1,320,000) were proposed and paid during the year.

Directors

The Directors who served during the year were:

T R Bentley 
T J M Bentley 
J M Story 
R L Carr 
L Flannery 
J A Clews (resigned 1 January 2023)
L Bilbrough (appointed 1 January 2023)

Research and development activities

The Stephenson business has and continues to invest heavily in R&D, with a significant element of our improvement in sales coming from new product groups developed in house with protected IP. The constant drive for enhanced products and process both in our factory and at our customers continues to drive our R&D and innovation functions as the key to mid to long term success of our business and to our customers who create value from our products.

- 4 -

 
STEPHENSON GROUP LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023

Going concern

In the opinion of the directors, the Company has sufficient financial resources together with clearly defined performance objectives. The Company has strong support of its bankers and shareholders in working towards meeting its financial objectives. As a consequence the Directors believe that the Company is well placed to manage its business risks successfully.
The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt a going concern basis of accounting in preparing the annual report and the financial statements. 

Matters covered in the strategic report

Certain information is not shown in the Directors' Report because it is shown in the Strategic Report instead under s414C(11). The Strategic Report includes a business review and market overview, information about the Company's principal risks and uncertainties, future developments and information about the Company's financial key performance indicators.

Disclosure of information to auditor

Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the directors are aware, there is no relevant audit information of which the Company's auditor is unaware, and

the directors have taken all the steps that ought to have been taken as directors in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end. 

Auditor

The auditor, Mazars LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 26 February 2024 and signed on its behalf.
 





T J M Bentley
Director
- 5 -

 
STEPHENSON GROUP LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF STEPHENSON GROUP LIMITED
 

Opinion

We have audited the financial statements of Stephenson Group Limited (the ‘Company’) for the year ended 30 September 2023 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the 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 FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

give a true and fair view of the state of the Company’s affairs as at 30 September 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 "Auditor’s responsibilities for the audit of the financial statements" section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the 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 information

The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
- 6 -

 
STEPHENSON GROUP LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF STEPHENSON GROUP LIMITED
 

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:
 
the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In 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 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:

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.
- 7 -

 
STEPHENSON GROUP LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF STEPHENSON GROUP LIMITED
 

Responsibilities of Directors

As explained more fully in the Directors' Responsibilities Statement set out on page 4, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.
 
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
 
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. 
Based on our understanding of the Company and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation, anti-money laundering regulation and the Bribery Act 2010.

To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:
Inquiring of management and, where appropriate, those charged with governance, as to whether the Company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations;
Inspecting correspondence, if any, with relevant licensing or regulatory authorities;
Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and
Considering the risk of acts by the Company which were contrary to applicable laws and regulations, including fraud.  

We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation, the Companies Act 2006. 
- 8 -

 
STEPHENSON GROUP LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF STEPHENSON GROUP LIMITED
 

In addition, we evaluated the directors’ and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to: posting manual journal entries to manipulate financial performance, management bias through judgments and assumptions in significant accounting estimates, in particular in relation to the valuation of the defined benefit scheme liability, revenue recognition (which we pinpointed to the cut off assertion), and significant one-off or unusual transactions.

Our audit procedures in relation to fraud included but were not limited to:
Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud;
Gaining an understanding of the internal controls established to mitigate risks related to fraud;
Discussing amongst the engagement team the risks of fraud; and
Addressing the risks of fraud through management override of controls by performing journal entry testing.

There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.

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 auditor’s report. 

Use of the audit 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.




Ashley Barraclough (Senior Statutory Auditor)

  
for and on behalf of

Mazars LLP
Chartered Accountants and Statutory Auditor
5th Floor
3 Wellington Place
Leeds
LS1 4AP

27 February 2024
- 9 -

 
STEPHENSON GROUP LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
26,970,701
34,790,552

Cost of sales
  
(16,616,105)
(22,177,460)

Gross profit
  
10,354,596
12,613,092

Administrative expenses
  
(7,861,616)
(8,931,801)

Operating profit
 5 
2,492,980
3,681,291

Other finance income
 9 
(92,000)
(72,000)

Profit before tax
  
2,400,980
3,609,291

Tax on profit
 10 
(368,457)
(650,854)

Profit for the financial year
  
2,032,523
2,958,437

Other comprehensive income for the year
  

Actuarial (losses)/gains on defined benefit pension scheme
  
(259,000)
1,261,000

Movement of deferred tax relating to pension deficit
  
64,750
(362,500)

Other comprehensive income for the year
  
(194,250)
898,500

Total comprehensive income for the year
  
1,838,273
3,856,937

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

The notes on pages 13 to 34 form part of these financial statements.
- 10 -

 
STEPHENSON GROUP LIMITED
REGISTERED NUMBER: 00068499

STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 13 
3,644,697
4,116,800

  
3,644,697
4,116,800

Current assets
  

Stocks
 14 
3,501,031
5,193,175

Debtors: amounts falling due within one year
 15 
7,156,792
8,152,660

Cash at bank and in hand
 16 
2,461,852
2,284,284

  
13,119,675
15,630,119

Creditors: amounts falling due within one year
 17 
(4,438,216)
(7,703,832)

Net current assets
  
 
 
8,681,459
 
 
7,926,287

Total assets less current liabilities
  
12,326,156
12,043,087

Provisions for liabilities
  

Deferred tax
 18 
(689,866)
(776,070)

Pension liability
 21 
(1,845,000)
(2,054,000)

Net assets
  
9,791,290
9,213,017


Capital and reserves
  

Called up share capital 
 19 
40,000
40,000

Capital redemption reserve
 20 
81,323
81,323

Profit and loss account
 20 
9,669,967
9,091,694

  
9,791,290
9,213,017


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 26 February 2024.




T J M Bentley
Director

The notes on pages 13 to 34 form part of these financial statements.
- 11 -

 
STEPHENSON GROUP LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2023


Called up share capital
Capital redemption reserve
Profit and loss account
Total equity

£
£
£
£


At 1 October 2021
40,000
81,323
6,554,757
6,676,080


Comprehensive income for the year

Profit for the year
-
-
2,958,437
2,958,437

Actuarial gains on pension scheme
-
-
898,500
898,500


Other comprehensive income for the year
-
-
898,500
898,500


Total comprehensive income for the year
-
-
3,856,937
3,856,937


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(1,320,000)
(1,320,000)


Total transactions with owners
-
-
(1,320,000)
(1,320,000)



At 1 October 2022
40,000
81,323
9,091,694
9,213,017


Comprehensive income for the year

Profit for the year
-
-
2,032,523
2,032,523

Actuarial losses on pension scheme
-
-
(194,250)
(194,250)


Other comprehensive income for the year
-
-
(194,250)
(194,250)


Total comprehensive income for the year
-
-
1,838,273
1,838,273


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(1,260,000)
(1,260,000)


Total transactions with owners
-
-
(1,260,000)
(1,260,000)


At 30 September 2023
40,000
81,323
9,669,967
9,791,290


The notes on pages 13 to 34 form part of these financial statements.
- 12 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

1.


General information

Stephenson Group Ltd ("the Company") is a private Company which is limited by shares, incorporated in the United Kingdom and registered in England and Wales, with registration number 00068499. The address of its registered office and principal place of business is Brookfoot House, Low Lane, Horsforth, Leeds, West Yorkshire, LS18 5PU.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

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 the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
     the requirements of Section 4 Statement of Financial Position paragraph 4.12(a)(iv);
     the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
     the requirements of Section 7 Statement of Cash Flows;
     the requirements of Section 11 Financial Instruments paragraphs 11.41(b) to  11.48(c);
     the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.29A; and
     the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Thos. Bentley & Son Limited as at 30 September 2023 and these financial statements may be obtained from Brookfoot House, Low Lane, Horsforth, LS18 5PU.
 
 
2.3

Going concern

In the opinion of the directors, the Company has sufficient financial resources together with clearly defined performance objectives. The Company has strong support of its bankers and shareholders in working towards meeting its financial objectives. As a consequence the Directors believe that the Company is well placed to manage its business risks successfully.
The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt a going concern basis of accounting in preparing the annual report and the financial statements. 

- 13 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.4

Turnover

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. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

 
2.5

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Statement of Comprehensive Income over its useful economic life.

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

- 14 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.6

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.

At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Plant & machinery
-
10-20 years
Motor vehicles
-
5 years
Fixtures, fittings and equipment
-
5-10 years

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 profit or loss.

Depreciation is charged to administrative expenses within the Statement of Comprehensive Income. 

 
2.7

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis and includes attributable overheads. 
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in Statement of Comprehensive Income.

 
2.8

Debtors

Short term debtors are measured at transaction price, less any impairment.

 
2.9

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.

- 15 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.10

Creditors

Short term creditors are measured at the transaction price. Other financial liabilities are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.11

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP, rounded to the nearest £1.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Comprehensive Income.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Statement of Comprehensive Income within 'other operating income'.

  
2.12

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.

 
2.13

Operating leases

Rentals paid under operating leases are charged to Statement of Comprehensive Income on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

- 16 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

  
2.14

Pensions

Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.

Defined benefit pension plan
The Company previously operated a defined benefit plan for certain employees. The Scheme closed to new members and to the future accrual of benefits on 31 March 2002. A defined benefit plan defines the pension benefit that the employee will receive on retirement, usually dependent upon several factors including but not limited to age, length of service and remuneration. A defined benefit plan is a pension plan that is not a defined contribution plan.
The liability recognised in the Statement of Financial Position in respect of the defined benefit plan is the present value of the defined benefit obligation at the end of the reporting date less the fair value of plan assets at the reporting date out of which the obligations are to be settled.
The defined benefit obligation is calculated using the projected unit credit method. Annually the company engages independent actuaries to calculate the obligation. The present value is determined by discounting the estimated future payments using market yields on high quality corporate bonds that are denominated in sterling and that have terms approximating to the estimated period of the future payments ('discount rate').
The fair value of plan assets is measured in accordance with the FRS 102 fair value hierarchy and in accordance with the Company's policy for similarly held assets. This includes the use of appropriate valuation techniques.
Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to other comprehensive income. These amounts together with the return on plan assets, less amounts included in net interest, are disclosed as 'Remeasurement of net defined benefit liability'.
The cost of the defined benefit plan, recognised in the Statement of Comprehensive Income as employee costs, except where included in the cost of an asset, comprises:
a) the increase in net pension benefit liability arising from employee service during the period; and
b) the cost of plan introductions, benefit changes, curtailments and settlements.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is recognised in Statement of Comprehensive Income as a 'finance expense'.

- 17 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.15

Provisions for liabilities

Provisions are made where 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 a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the reporting 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 Statement of Financial Position.

 
2.16

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
- 18 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)

 
2.17

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.

The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.

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 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 receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
 
- 19 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

2.Accounting policies (continued)


2.17
Financial instruments (continued)


Financial liabilities

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

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

- 20 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The critical judgments that the directors have made in the process of applying the Company’s accounting policies that have the most significant effect on the amounts recognised in the statutory financial statements are discussed below.
(i) Assessing indicators of impairment
In assessing whether there have been any indicators of impairment of assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability and where applicable, the ability of the asset to be operated as planned. There have been no indicators of impairments identified during the current financial year.
Critical judgments in applying the accounting policies
The critical judgments that the directors have made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements are discussed below:
(i) Defined benefit pension scheme
The pension scheme assets and liabilities are valued using an actuarial valuation based on market assumptions.
(ii) Determining residual values and useful economic lives of tangible assets
The Company depreciates tangible assets, and amortises intangible assets, over their estimated useful lives. The estimation of the useful lives of tangible assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied. The estimation of useful lives of intangible assets is based on any contractual or legal rights associated with the asset, or the period in which the Company expects to use the asset if shorter. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes.
Judgmental is also applied, when determining the residual values for fixed assets. When determining the residual value, the directors have assessed the amount that the Company would currently obtain for the disposal of the asset, if it were already of the condition expected at the end of its useful life. Where possible this is done with reference to external market prices.
 
- 21 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

4.


Turnover

The whole of the turnover is attributable to the principal activity of the Company.

Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
5,834,881
9,265,906

Rest of Europe
9,936,664
11,550,546

Rest of the world
11,199,156
13,974,100

26,970,701
34,790,552



5.


Operating profit

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

2023
2022
£
£

Research & development charged as an expense
200,000
193,695

Exchange differences
32,530
(312,170)

Other operating lease rentals
142,110
209,042

Depreciation of tangible fixed assets
494,098
376,618

Amortisation of intangible fixed assets, including goodwill
-
2,500

Defined contribution pension cost
186,796
176,947


6.


Auditor's remuneration

During the year, the Company obtained the following services from the Company's auditor:


2023
2022
£
£

Fees payable to the Company's auditor for the audit of the Company's financial statements

29,000
19,200

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.

- 22 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

7.


Employees

Staff costs, including Directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
3,533,300
4,632,634

Social security costs
376,747
412,842

Cost of defined contribution scheme
186,796
176,947

4,096,843
5,222,423


The average monthly number of employees, including directors, during the year was 103 (2022 - 113).


8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
472,234
619,948


During the year retirement benefits were accruing to 4 Directors (2022 - 4) in respect of defined contribution pension schemes.

The highest paid Director received remuneration of £130,383 (2022 - £199,191).

The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to £1,245 (2022 - £4,422).


9.


Other finance costs

2023
2022
£
£

Interest on defined benefit pension scheme
92,000
72,000


- 23 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

10.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
340,038
312,655

Adjustments in respect of previous periods
(2,377)
(146,554)


337,661
166,101


Total current tax

337,661
166,101

Deferred tax


Origination and reversal of timing differences
33,466
484,753

Adjustments in respect of previous periods
(2,670)
-

Total deferred tax
30,796
484,753


Taxation on profit on ordinary activities
368,457
650,854

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 22.01% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
2,400,980
3,609,291


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 22.01% (2022 - 19%)
528,456
685,765

Effects of:


Expenses not deductible for tax purposes
3,052
10,243

Capital allowances for year in excess of depreciation
5,986
(1,122)

Adjustments to tax charge in respect of prior periods
(2,377)
(146,554)

Adjustments to tax charge in respect of prior periods - deferred tax
(2,670)
-

Income not taxable for tax purposes
(110,041)
97,515

Adjustment in research and development tax credit leading to a decrease in the tax charge
(57,221)
(47,843)

Adjustment in respect of changing rate of deferred tax
4,005
72,536

Other differences leading to a decrease in the tax charge
(733)
(12,509)

Group relief
-
(7,177)

Total tax charge for the year
368,457
650,854
- 24 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
10.Taxation (continued)


Factors that may affect future tax charges

From 1 April 2023, the rate of corporation tax in the United Kingdom increased from 19% to 25%. Companies with profits of £50,000 or less will continue to be taxed at 19%, which is a new small profits rate. Where taxable profits are between £50,000 and £250,000, the higher 25% rate will apply but with a marginal relief applying as profits increase.


11.


Dividends

2023
2022
£
£


Interim and final dividend
1,260,000
1,320,000


12.


Intangible assets




Patents
Goodwill
Total

£
£
£



Cost


At 1 October 2022
170,669
150,000
320,669



At 30 September 2023

170,669
150,000
320,669



Amortisation


At 1 October 2022
170,669
150,000
320,669



At 30 September 2023

170,669
150,000
320,669



Net book value



At 30 September 2023
-
-
-



At 30 September 2022
-
-
-



- 25 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

13.


Tangible fixed assets





Plant & machinery
Motor vehicles
Fixtures & fittings
Total

£
£
£
£



Cost


At 1 October 2022
7,618,020
28,531
197,987
7,844,538


Additions
21,995
-
-
21,995



At 30 September 2023

7,640,015
28,531
197,987
7,866,533



Depreciation


At 1 October 2022
3,538,455
24,252
165,031
3,727,738


Charge for the year
482,608
4,279
7,211
494,098



At 30 September 2023

4,021,063
28,531
172,242
4,221,836



Net book value



At 30 September 2023
3,618,952
-
25,745
3,644,697



At 30 September 2022
4,079,565
4,279
32,956
4,116,800

Included in Plant & machinery is a value of £113,223 (2022 - £1,239,301) relating to Assets Under Construction not yet depreciated.


14.


Stocks

2023
2022
£
£

Raw materials and consumables
1,517,017
2,379,942

Finished goods and goods for resale
1,984,014
2,813,233

3,501,031
5,193,175


- 26 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

15.


Debtors

2023
2022
£
£


Trade debtors
6,015,063
6,863,075

Amounts owed by group undertakings
478,362
277,234

Amounts owed by associated undertakings
43,711
207,332

Other debtors
21,774
110,169

Prepayments and accrued income
136,632
180,570

Tax recoverable
-
780

Deferred taxation
461,250
513,500

7,156,792
8,152,660


Amounts owed by group and associated undertakings are unsecured, interest free and repayable on demand. 


16.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
2,461,852
2,284,284



17.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
3,097,673
5,737,130

Amounts owed to group undertakings
1,684
-

Corporation tax
337,661
-

Other taxation and social security
73,279
55,624

Other creditors
54,452
288,810

Accruals and deferred income
873,467
1,622,268

4,438,216
7,703,832


Amounts owed to group undertakings and associate undertakings are unsecured, interest free and repayable on demand.

- 27 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

18.


Deferred taxation




2023
2022


£

£






At beginning of year
(262,570)
584,683


Charged to the profit or loss
(30,796)
(484,753)


(Charged)/credited to other comprehensive income
64,750
(362,500)



At end of year
(228,616)
(262,570)

The deferred tax balance is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(689,866)
(776,070)

Defined benefit pension scheme
461,250
513,500

(228,616)
(262,570)

Comprising:

Asset - due within one year
461,250
513,500

Liability
(689,866)
(776,070)

(228,616)
(262,570)



19.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



40,000 (2022 - 40,000) Ordinary shares of £1.00 each
40,000
40,000

The Ordinary shares have attached to them full voting, dividend and capital distribution (including on winding up) rights. They do not confer any rights of redemption nor a right to a fixed income.


- 28 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

20.


Reserves

Capital redemption reserve

This reserve arose from a historic buy back of shares.

Profit & loss account

This reserve represents cumulative profits and losses of the Company less cumulative dividends paid. The full reserve is available for distribution. 


21.


Pension commitments

Defined contribution pension scheme
The Company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £186,796 (2022 - £176,947). There were contributions of £22,963 (2022 - £22,963) payable to the fund at the balance sheet date.

The Company operates a Defined Benefit Pension Scheme.

Defined Benefit Pension Scheme
The Company operates a Defined Benefit Pension Scheme, the Stephenson Group Limited Retirement Benefits Scheme (the "Scheme"). The Scheme is administered by a separate board of Trustees which is legally separate from the Company. The Trustees are composed of representatives of both the employer and members of the Scheme.
The Scheme was closed to new members on 31 March 2002 and closed to future accrual of benefits on 31 March 2007. The most recent full funding valuation was on 1 April 2018 and was carried out by a qualified independent actuary. This has been updated to 30 September 2023.
The Company expects to contribute £579,000 to the scheme in the year ending 30 September 2024.
Additional employer contributions might be required if there are any redundancies or benefit augmentations during the year.
 
- 29 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
21.Pension commitments (continued)

Mortality assumption
The mortality assumptions are based on 100% of SAPS S2PXA "All lives" tables with allowance for future improvements in line with the CMI 2022 projections with a smoothing parameter for 7.0 and a long term trend rate of 1.00% p.a. The assumptions are that a member currently aged 65 will live on average for a further 21.8 (2022 - 21.9) years if they are male and for a further 23.6 (2022 - 23.7) years if they are female.
Members currently aged 45 are expected to live for a further 22.7 (2022 - 22.9) years from age 65 if they are male and for a further 24.8 (2022 - 24.9) years if they are female.



Reconciliation of present value of plan liabilities:


2023
2022
£
£

Reconciliation of present value of plan liabilities


At the beginning of the year
5,654,000
8,572,000

Interest income
287,000
173,000

Actuarial gains
(153,000)
(2,777,000)

Benefits paid
(267,000)
(314,000)

At the end of the year
5,521,000
5,654,000


Composition of plan liabilities:


2023
2022
£
£


Present value of funded obligations
5,521,000
5,654,000
- 30 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
21.Pension commitments (continued)


Reconciliation of present value of plan assets:


2023
2022
£
£


At the beginning of the year
3,600,000
4,866,000

Interest income
195,000
101,000

Actuarial losses
(412,000)
(1,516,000)

Contributions
560,000
463,000

Benefits paid
(267,000)
(314,000)

At the end of the year
3,676,000
3,600,000


Composition of plan assets:


2023
2022
£
£


Bonds
1,506,000
1,101,000

Cash
2,071,000
2,193,000

Diversified Growth Fund
99,000
306,000

Total plan assets
3,676,000
3,600,000
- 31 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
21.Pension commitments (continued)

2023
2022
£
£


Fair value of plan assets
3,676,000
3,600,000

Present value of plan liabilities
(5,521,000)
(5,654,000)

Net pension scheme liability
(1,845,000)
(2,054,000)

2023
2022
£
£


Interest on obligation
(92,000)
(72,000)


The cumulative amount of actuarial (loss)/gain recognised in the Statement of Comprehensive Income was (£259,000) (2022 - £898,500).





Principal actuarial assumptions at the reporting date (expressed as weighted averages):

2023
2022
%
%
Discount rate


5.45

5.2
 
Future pension increases


3

3.25
 
Inflation assumption


3.2

3.6
 
Mortality rates



 
- for a male aged 65 now


86.8

86.9
 
- at 65 for a male aged 45 now


87.8

87.9
 
- for a female aged 65 now


88.5

88.7
 
- at 65 for a female member aged 45 now


88.8

89.9
 

- 32 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
 
21.Pension commitments (continued)


Amounts for the current and previous four periods are as follows:


Defined benefit pension schemes

2023
2022
2021
2020
2019
£
£
£
£
£
Defined benefit obligation

(5,521,000)

(5,654,000)

(8,572,000)
 
(8,659,000)
 
(8,515,000)

Scheme assets

3,676,000

3,600,000

4,866,000
 
4,764,000
 
4,497,000

Surplus
(1,845,000)

(2,054,000)

(3,706,000)
 
(3,895,000)
 
(4,018,000)


Experience adjustments on scheme liabilities
153,000
2,777,000
9,000
(189,000)
(1,439,000)
Experience adjustments on scheme assets
(412,000)
(1,516,000)
(35,000)
86,000
203,000
(259,000)
1,261,000
(26,000)
(103,000)
(1,236,000)



22.


Commitments under operating leases

At 30 September 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
128,887
138,254

Later than 1 year and not later than 5 years
223,932
424,887

352,819
563,141


23.Other financial commitments

As at the year end the Company had committed to forward contract currency options totalling USD 2,400,000 (2022 - USD 2,400,000) with maturity dates ranging from October 2023 to January 2024  (2022 - October 2022 to January 2023).
As at the end of the year, the Company had committed to forward purchase contracts totalling £390,101 (2022 - £418,604) in respect of refined palm products with maturity dates in October 2023 to February 2024 (2022 - October 2022 to July 2023).

- 33 -

 
STEPHENSON GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023

24.


Related party transactions

The Company has taken the exemption permitted by Section 33 Related Party Disclosures, not to disclose transactions made with other wholly owned group companies of Thos. Bentley & Son Limited Group.
Sustain Co2 Limited and Stephenson Group Limited are related parties by virtue of common directorships. In the year ended 30 September 2023 Stephenson Group Limited made product sales totalling £345,387 (2022 - £243,841) and recharges totalling £380,847 (2022 - £482,106)  to Sustain Co2 Limited. At the year end date an amount totalling £59,782 (2022 - £60,294) was outstanding.


25.


Post balance sheet events

There have been no significant events affecting the Company since the year end. 


26.


Controlling party

The Company's immediate and ultimate parent company at the balance sheet date was Thos. Bentley & Son Limited. Copies of the consolidated accounts can be obtained from the Registrar of companies, Companies House, Cardiff.
The ultimate controlling party is the T R Bentley 1997 Discretionary Settlement by virtue of its majority ownership of the immediate and ultimate parent company.
 
- 34 -