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Registered number: 08460511














MCCARTHY DENNING LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

 
MCCARTHY DENNING LIMITED
 

CONTENTS



Page
Statement of Financial Position
 
1 - 2
Notes to the Financial Statements
 
3 - 11


 
MCCARTHY DENNING LIMITED
REGISTERED NUMBER:08460511

STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 5 
42,157
61,614

Tangible assets
 6 
7,681
39,284

Investments
 7 
-
405

  
49,838
101,303

Current assets
  

Debtors: amounts falling due within one year
 8 
6,056,407
5,591,516

Current asset investments
 9 
557
12,195

Cash at bank and in hand
  
205,934
450,152

  
6,262,898
6,053,863

Current liabilities
  

Creditors: amounts falling due within one year
 10 
(5,800,710)
(5,805,291)

Net current assets
  
 
 
462,188
 
 
248,572

Total assets less current liabilities
  
512,026
349,875

Creditors: amounts falling due after more than one year
 11 
(63,534)
(141,348)

Deferred tax
 12 
(10,745)
(15,889)

Net assets
  
437,747
192,638


Capital and reserves
  

Called up share capital 
 13 
86
86

Share premium account
  
18,768
18,768

Profit and loss account
  
418,893
173,784

  
437,747
192,638


The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

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

Page 1

 
MCCARTHY DENNING LIMITED
REGISTERED NUMBER:08460511
    
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 MARCH 2023

The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 13 March 2024.



R A D Beresford
Director

The notes on pages 3 to 11 form part of these financial statements.

Page 2

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

1.


General information

McCarthy Denning Limited is a private limited liability company incorporated in England and Wales, with its registered office at  Suite 102, 70 Mark Lane, London EC3R 7NQ.
The principal activity of the Company continued to be that of provision of legal services.


2.


Structure of business

McCarthy Denning employs an innovative structure which involves distributing at least 70% of the fees it receives from clients to its lawyers and other fee earners (who are all self-employed). These sums only fall due if the firm receives payments from its clients for the fees in question. This means that the cost of sales figure includes costs that would, if the accounts were to be prepared on the basis that a more traditional law firm (employing an LLP or partnership structure) would typically utilise, be shown as profits attributable to the members or equity partners. If McCarthy Denning were to adopt such a basis of accounting, the cost of sales figures would be £1,875 (2022 - £1,343), gross profit £8,075,773 (2022 - £7,616,454) and profit before tax attributable to members or partners £6,167,786 (2022 - £5,789,973).

3.Accounting policies

 
3.1

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 Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The following principal accounting policies have been applied:

 
3.2

Turnover

Turnover comprises revenue recognised by the company in respect of services supplied during the year, exclusive of Value Added Tax.
Revenue is recognised in the period in which services are provided.

 
3.3

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.

Page 3

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)


3.3
Tangible fixed assets (continued)

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:

Short-term leasehold property
-
over term of the lease of 5 years
Fixtures and fittings
-
25% straight line method
Office equipment
-
33% straight line method

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.

 
3.4

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.

The intangible asset is considered to have a finite useful life and is amortised over its useful life of five years.

 
3.5

Valuation of investments

Investments in listed company shares are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in profit or loss for the period.

 
3.6

Debtors

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

 
3.7

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions.

 
3.8

Financial instruments

The Company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties and loans to related parties.
Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. 
Financial assets that are measured at cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.

Page 4

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

 
3.9

Creditors

Short-term creditors are measured at the transaction price. The company recognises accruals contingent on the receipt of debtors in it's balance sheet. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
3.10

Foreign currency translation

The Company's functional and presentational currency is £ Sterling.
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. Exchange gains and losses are recognised in the Statement of Comprehensive Income.

 
3.11

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss 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.

 
3.12

Pensions

Defined contribution pension plan
The Company contributes to 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.

 
3.13

Borrowing costs

All borrowing costs are amortised in the Statement of Comprehensive Income over the term of the loan.

 
3.14

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

Page 5

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

3.Accounting policies (continued)

 
3.15

Current and deferred taxation

Tax is recognised in the Statement of Comprehensive Income, 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 Statement of Financial Position 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.

 
3.16

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.


4.


Employees

The average monthly number of employees, including directors, during the year was 11 (2022 - 12).

Page 6

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

5.


Intangible assets




Computer software

£



Cost


At 1 April 2022
81,071



At 31 March 2023

81,071



Amortisation


At 1 April 2022
19,457


Charge for the year on owned assets
19,457



At 31 March 2023

38,914



Net book value



At 31 March 2023
42,157



At 31 March 2022
61,614



Page 7

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

6.


Tangible fixed assets





Short-term leasehold property
Fixtures and fittings
Office equipment
Total

£
£
£
£



Cost 


At 1 April 2022
52,093
124,332
10,753
187,178



At 31 March 2023

52,093
124,332
10,753
187,178



Depreciation


At 1 April 2022
34,817
103,290
9,787
147,894


Charge for the year on owned assets
10,419
20,618
566
31,603



At 31 March 2023

45,236
123,908
10,353
179,497



Net book value



At 31 March 2023
6,857
424
400
7,681



At 31 March 2022
17,276
21,042
966
39,284


7.


Fixed asset investments





Listed investments

£



Valuation


At 1 April 2022
405


Transfer to current asset investments
(405)



At 31 March 2023
-




Page 8

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

8.


Debtors

2023
2022
£
£


Trade debtors
4,413,235
4,013,290

Other debtors
295,598
174,245

Prepayments and accrued income
1,347,574
1,403,981

6,056,407
5,591,516



9.


Current asset investments

2023
2022
£
£

Valuation of listed investments

At 1 April 2021
12,195
83,365

Transfer from fixed asset investments
405
-

Fair value movements
(12,043)
(71,170)

At 31 March 2022
557
12,195



10.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank overdrafts
15
-

Bank loans (Note 11)
77,812
74,573

Trade creditors
1,887,043
1,001,069

Taxation and social security
85,489
337,631

Other creditors
158,661
102,205

Accruals and deferred income
3,591,690
4,289,813

5,800,710
5,805,291


The company's bank facilities are secured by a fixed and floating charge over the assets of the company.

Page 9

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

11.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans
63,534
141,348


The company's bank facilities are secured by an unlimited fixed and floating charge over all the assets of the company.
Bank loans comprise a Coronavirus Business Interruption Loan attracting interest at a fixed rate of 2.5% repayable by 3 June 2026, and a bank loan of £200,000 attracting interest at a fixed interest rate of 4.52% repayable by 28 October 2024. 


12.


Deferred taxation




2023
2022


£

£






At beginning of year
15,889
10,277


(Released) / charged to Statement of Comprehensive Income
(5,144)
5,612



At end of year
10,745
15,889

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
10,745
15,889

Page 10

 
MCCARTHY DENNING LIMITED
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023

13.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



200 (2022 - 200) Ordinary (issued 2015) shares of £0.01 each
2
2
6,700 (2022 - 6,700) Ordinary (issued 2016) shares of £0.01 each
67
67

69

69

Allotted, called up and partly paid



1,725 (2022 - 1,725) Ordinary (issued 2018) shares of £0.01 each
17
17



14.Directors' personal guarantees

R A D Beresford has provided personal guarantees totalling £245,000 (2022 - £245,000) and a Deed of Subordination as security for the company's banking facilities.   



15.


Auditors' information

The auditors' report on the financial statements for the year ended 31 March 2023 was unqualified.

The audit report was signed on 13 March 2024 by Stephen Iseman FCA (Senior Statutory Auditor) on behalf of Sopher + Co LLP.

 
Page 11