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Registered number: 08879988










ARMSTRONG TEASDALE LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

 
ARMSTRONG TEASDALE LIMITED
 
 
COMPANY INFORMATION


Directors
Daniel O'Connell 
Armstrong Teasdale (UK) Limited 




Registered number
08879988



Registered office
38-43 Lincoln's Inn Fields

London

WC2A 3PE




Independent auditors
Sumer Auditco Limited

14th Floor

33 Cavendish Square

London

W1G 0PW





 
ARMSTRONG TEASDALE LIMITED
 

CONTENTS



Page
Strategic report
1
Directors' report
2 - 3
Independent auditors' report
4 - 7
Profit and loss account
8
Balance sheet
9
Statement of changes in equity
10 - 11
Notes to the financial statements
12 - 27


 
ARMSTRONG TEASDALE LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

Introduction
 
The directors present the strategic report for the year ended 31 December 2022.

Business review
 
The principal activity of the company is that of Solicitors.

Development and performance

The company has made a profit of £185,801 (2021: £91,394) for the year ended 31 December 2022. During the year the company acquired the business of Phillips and Leigh LLP.
The company continues to develop and focus on the key elements of the firms business strategy. Using the resources provided by the company’s US parent, the company is seeking to expand the business by both organic growth and further acquisitions. 

Financial key performance indicators
 
A key performance indicator is the revenue received from its clients. The company generated income of £10,737,411 (2021: £9,024,951) which reflects the growth achieved in the current year.
The Company’s business is regularly reviewed and it is the responsibility of the directors to continue to bring profitability to the company over the forthcoming years.

Principal risks and uncertainties
 
Liquidity risk
The directors monitor cashflow to ensure that sufficient funds are available to meet future obligations as they fall due. The directors rely on working capital from its ultimate parent, Armstrong Teasdale LLP.
Credit risk
The Company is exposed to clients non-payment of fees. The Company monitors the onboarding of clients, including their financial stability of the clients so that credit risk is contained and reduced where possible.
Market risk
The Company is exposed to market risk, including interest rate rises. Where possible the company,  when borrowing funds, enters into fixed rate agreements in order to minimise fluctuations resulting from interest rate changes.


This report was approved by the board on 7 March 2024 and signed on its behalf.



................................................
Armstrong Teasdale (UK) Limited
Director

Page 1

 
ARMSTRONG TEASDALE LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022

The directors present their report and the financial statements for the year ended 31 December 2022.

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;

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.

Principal activity

The principal activity of the company is that of Solicitors.

Directors

The directors who served during the year were:

Anthony Kerman (resigned 6 July 2022)
Daniel O'Connell 
Armstrong Teasdale (UK) Limited 


Principal risks and uncertainties

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of principal risks and uncertainties and future developments.

Page 2

 
ARMSTRONG TEASDALE LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022

Disclosure of information to auditors

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

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

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

Auditors

The auditorsSumer Auditco Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 7 March 2024 and signed on its behalf.
 





................................................
Armstrong Teasdale (UK) Limited
Director

Page 3

 
ARMSTRONG TEASDALE LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ARMSTRONG TEASDALE LIMITED
 

Qualified Opinion


We have audited the financial statements of Armstrong Teasdale Limited (the 'Company') for the year ended 31 December 2022, which comprise the Profit and loss account, the Balance sheet, the Statement of changes in equity and the related notes, including a summary of significant accounting policiesThe 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, except for the effects of the matter described in the basis for qualified opinion section,  the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 December 2022 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 qualified opinion


Included in the company's balance sheet is goodwill of £5,687,000 which is not being amortised contrary to the requirements of the Companies Act 2006. In addition, the company has not provided for annuity payments due to two former members of the LLP from which the trading operations were acquired. The annuities are payable for 10 years at £40,000 per annum per member. The annuities commenced payment in the years ended 31 March 2016 and 2017.


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.


Page 4

 
ARMSTRONG TEASDALE LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ARMSTRONG TEASDALE LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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. 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.


Opinion 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 the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the 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.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 2, 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.


Page 5

 
ARMSTRONG TEASDALE LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ARMSTRONG TEASDALE LIMITED (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' 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:

In order to identify and assess the risks of material misstatements, including fraud and non-compliance with laws and regulations that could be expected to have a material impact on the financial statements, we have considered:
 
the results of our enquiries of management and those charged with governance of their assessment of the risks of fraud and irregularities;
the nature of the company including its management structure and control systems (including the opportunity for management to override such controls);
management’s incentives and opportunities for fraudulent manipulation of the financial statements including the company’s remuneration and bonus policies and performance targets; and
the industry and environment in which it operates.
 
We also considered UK tax and pension legislation and laws and regulations relating to employment and the preparation and presentation of the financial statements such as the Companies Act 2006.
 
Based on this understanding we identified the following matters as being of significance to the entity:
 
laws and regulations considered to have a direct effect on the financial statements including UK financial reporting standards, Company Law, tax and pension legislation and distributable profits legislation;
the timing of the recognition of commercial income;
compliance with legislation relating to GDPR and client money
management bias in selecting accounting policies and determining estimates;
inappropriate journal entries;
recoverability of debtors; and Work in Progress at the balance sheet dates.
 
We communicated the outcomes of these discussions and enquiries, as well as consideration as to where and how fraud may occur in the entity, to all engagement team.
 
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised:
 
enquiries of management and those charged with as to whether the entity complies with such laws and regulations;
enquiries with the same concerning any actual or potential litigation or claims;
discussion with the same regarding any known or suspected instances of non-compliance with laws and regulation and fraud;
assessment of matters reported to management and the result of the subsequent investigation;
obtaining an understanding of the policies and controls over the recognition of income and testing their
Page 6

 
ARMSTRONG TEASDALE LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ARMSTRONG TEASDALE LIMITED (CONTINUED)


implementation during the year;
challenging assumptions made by management in their specific accounting policies and estimates, in particular in relation to depreciation of tangible fixed assets; amortisation of intangible fixed assets; recognition of income;
identifying and testing journal entries, in particular any journal entries posted with unusual account combinations or crediting revenue or cash;
assessing the recovery of debtors in the period since the balance sheet date and challenging assumptions made by management regarding the recovery of balances which remain outstanding;
reviewing the financial statements for compliance with the relevant disclosure requirements;
performing analytical procedures to identify any unusual or unexpected relationships or unexpected
movements in account balances which may be indicative of fraud;
evaluating the underlying business reasons for any unusual transactions; and
considered the implementation of controls during the year.
 
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).


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 Auditors' 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 2006Our 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 Auditors' 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.





Shilen Manek, ACA, FCCA (Senior statutory auditor)
  
for and on behalf of
Sumer Auditco Limited
 
Statutory Auditors
  
14th Floor
33 Cavendish Square
London
W1G 0PW

15 March 2024
Page 7

 
ARMSTRONG TEASDALE LIMITED
 
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022

2022
2021
£
£


Turnover
10,737,411
9,024,951

Cost of sales
(177,632)
-

Gross profit
10,559,779
9,024,951

Administrative expenses
(10,756,737)
(9,259,700)

Operating loss
(196,958)
(234,749)

Income from shares in group undertakings
479,311
382,829

Interest receivable and similar income
59,581
875

Interest payable and similar expenses
(156,133)
(57,561)

Profit before tax
185,801
91,394

Profit for the financial year
185,801
91,394

There was no other comprehensive income for 2022 (2021: NIL).

The notes on pages 12 to 27 form part of these financial statements.

Page 8

 
ARMSTRONG TEASDALE LIMITED
REGISTERED NUMBER: 08879988

BALANCE SHEET
AS AT 31 DECEMBER 2022

2022
2021
Note
£
£

Fixed assets
  

Intangible assets
 11 
5,687,000
5,500,000

Tangible assets
 12 
1,170,322
17,072

Investments
 13 
114,477
43,269

  
6,971,799
5,560,341

Current assets
  

Debtors: amounts falling due within one year
 14 
5,346,061
3,285,100

Cash at bank and in hand
 15 
2,439,914
246,669

  
7,785,975
3,531,769

Creditors: amounts falling due within one year
 16 
(6,680,874)
(2,882,816)

Net current assets
  
 
 
1,105,101
 
 
648,953

Total assets less current liabilities
  
8,076,900
6,209,294

Creditors: amounts falling due after more than one year
 17 
(1,352,610)
(944,457)

  

Net assets
  
6,724,290
5,264,837


Capital and reserves
  

Called up share capital 
  
10,000
10,000

Share premium account
 22 
5,490,100
5,490,100

Other reserves
 22 
2,166,052
892,400

Profit and loss account
 22 
(941,862)
(1,127,663)

  
6,724,290
5,264,837


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 7 March 2024.




................................................
Armstrong Teasdale (UK) Limited
Director

The notes on pages 12 to 27 form part of these financial statements.

Page 9

 
ARMSTRONG TEASDALE LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022


Called up share capital
Share premium account
Other reserves
Profit and loss account
Total equity

£
£
£
£
£

At 1 January 2022
10,000
5,490,100
892,400
(1,127,663)
5,264,837


Comprehensive income for the year

Profit for the year

-
-
-
185,801
185,801


Other comprehensive income for the year
-
-
-
-
-


Total comprehensive income for the year
-
-
-
185,801
185,801

Funds provided by parent undertaking
-
-
1,273,652
-
1,273,652


Total transactions with owners
-
-
1,273,652
-
1,273,652


At 31 December 2022
10,000
5,490,100
2,166,052
(941,862)
6,724,290


The notes on pages 12 to 27 form part of these financial statements.

Page 10

 
ARMSTRONG TEASDALE LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021


Called up share capital
Share premium account
Other reserves
Profit and loss account
Total equity

£
£
£
£
£

At 1 January 2021
10,000
5,490,100
-
(1,219,057)
4,281,043


Comprehensive income for the year

Profit for the year

-
-
-
91,394
91,394


Other comprehensive income for the year
-
-
-
-
-


Total comprehensive income for the year
-
-
-
91,394
91,394

Funds provided by parent undertaking
-
-
892,400
-
892,400


Total transactions with owners
-
-
892,400
-
892,400


At 31 December 2021
10,000
5,490,100
892,400
(1,127,663)
5,264,837


The notes on pages 12 to 27 form part of these financial statements.

Page 11

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

1.


General information

The company is a private company limited by shares and is incorporated in England and Wales. The address of its registered office is 38-43 Lincoln's Inn Fields, London, WC2A 3PE.

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 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d).

This information is included in the consolidated financial statements of Armstrong Teasdale (UK) Limited as at 31 December 2022 and these financial statements may be obtained from 38-43 Lincoln’s Inn Fields, London WC2A 3PE.

 
2.3

Exemption from preparing consolidated financial statements

The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of any part of the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006.

Page 12

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.4

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

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 profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Profit and loss account within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

 
2.5

Revenue

Revenue comprises fees and disbursements receivable, exclusive of Value Added Tax and trade discounts.
Where the company has incomplete contracts at the year end, income and expenditure for these contracts are recognised so that is reflects the partial performance of the contractual obligations. For such contracts, the amount of revenue reflects the value of the work performed. Revenue not billed to clients is included in debtors.

 
2.6

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.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.8

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Page 13

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.9

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

  
2.10

Intangible fixed 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 acquire at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated impairment losses.
It is the opinion of the Directors that the firm’s income and growth will increase and the company will return to profitability and accordingly it is their view that no impairment is required in the year.

 
2.11

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 balance sheet 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 balance sheet 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 balance sheet date.

 
2.12

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 14

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)


2.12
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 improvements
-
over period of lease - 8.5 years
Plant and machinery
-
20 straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

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

 
2.14

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.15

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. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.16

Creditors

Short-term creditors are measured at the transaction price. 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.

Page 15

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)

 
2.17

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 balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance sheet.

 
2.18

Financial instruments

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

Financial instruments are recognised in the Company's Balance sheet 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.

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
Page 16

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

2.Accounting policies (continued)


2.18
Financial instruments (continued)

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.

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.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In the preparation of these accounts the director's have made a number of judgments in particular the appropriate provisions to be made against trade debtors and work in progress. 

Page 17

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

4.


Turnover

An analysis of turnover by class of business is as follows:


2022
2021
£
£

Sales
10,737,411
9,024,951

10,737,411
9,024,951


Analysis of turnover by country of destination:

2022
2021
£
£

United Kingdom
7,083,411
6,220,951

EEA and Switzerland
514,000
1,018,000

Americas
1,721,000
850,000

Channel Islands
797,000
545,000

Rest of world
622,000
391,000

10,737,411
9,024,951



5.


Operating loss

The operating loss is stated after charging:

2022
2021
£
£

Exchange differences
10,479
22,697


6.


Auditors' remuneration

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


2022
2021
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
59,748
61,934

Page 18

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

7.


Employees



The Company has no employees other than the directors, who did not receive any remuneration (2021 -£NIL).
Fees are generated by employees Armstrong Teasdale Management Limited which charges a management fee for these services. The staff numbers in Armstrong Teasdale Management Limited are as follows:

2022
2021
Finance

2

2
 
Legal Services


49

49
 
51

51
 

During the year, director's of Armstrong Teasdale Limited were paid £210,000 (2021: £210,250) by Armstrong Teasdale Management Limited.



8.


Interest receivable

2022
2021
£
£


Other interest receivable
59,581
875

59,581
875


9.


Interest payable and similar expenses

2022
2021
£
£


Bank interest payable
119,552
52,583

Finance leases and hire purchase contracts
31,381
2,016

Other interest payable
5,200
2,962

156,133
57,561

Page 19

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

10.


Taxation


2022
2021
£
£



Total current tax
-
-

Deferred tax

Total deferred tax
-
-


Tax on profit
-
-

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2021 - lower than) the standard rate of corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:

2022
2021
£
£


Profit on ordinary activities before tax
185,801
91,394


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2021 - 19%)
35,302
17,365

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
2,350
5,426

Capital allowances for year in excess of depreciation
(183,503)
23,018

Utilisation of tax losses
144,556
(45,841)

Dividends from UK companies
(91,069)
(72,738)

Group relief
92,364
72,770

Total tax charge for the year
-
-


Factors that may affect future tax charges

The company has tax loss carried forward of approximately £2.1m of which £1m has been offset against potential accelerated capital allowances and £900,000 has been recognised as a deferred tax asset. 

Page 20

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

11.


Intangible assets




Goodwill

£



Cost


At 1 January 2022
5,500,000


Additions
187,000



At 31 December 2022

5,687,000






Net book value



At 31 December 2022
5,687,000



At 31 December 2021
5,500,000



Page 21

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

12.


Tangible fixed assets





Short-term leasehold improvements
Plant and machinery
Computer equipment
Total

£
£
£
£



Cost or valuation


At 1 January 2022
232,980
184,850
-
417,830


Additions
1,052,925
108,954
85,875
1,247,754


Disposals
(232,980)
(184,850)
-
(417,830)



At 31 December 2022

1,052,925
108,954
85,875
1,247,754



Depreciation


At 1 January 2022
219,786
180,972
-
400,758


Charge for the year on owned assets
61,938
10,443
5,051
77,432


Disposals
(219,786)
(180,972)
-
(400,758)



At 31 December 2022

61,938
10,443
5,051
77,432



Net book value



At 31 December 2022
990,987
98,511
80,824
1,170,322



At 31 December 2021
13,194
3,878
-
17,072

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2022
2021
£
£



Land and buildings
865,797
-

Plant and machinery
88,552
-

Other fixed assets
80,824
-

1,035,173
-

Page 22

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

13.


Fixed asset investments





Investments in subsidiary companies
Listed investments
Total

£
£
£



Cost or valuation


At 1 January 2022
42,969
300
43,269


Additions
71,508
-
71,508


Amounts written off
-
(300)
(300)



At 31 December 2022
114,477
-
114,477





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Armstrong Teasdale Management Limited
United Kingdom
Ordinary
100%
Armstrong Teasdale Ireland Solicitors Partnership
Ireland
n/a
99%


14.


Debtors

2022
2021
£
£


Trade debtors
4,052,547
2,338,853

Other debtors
31,429
22,542

Prepayments and accrued income
177,727
166,296

Amounts recoverable on long-term contracts
904,358
577,409

Deferred taxation
180,000
180,000

5,346,061
3,285,100


Page 23

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

15.


Cash and cash equivalents

2022
2021
£
£

Cash at bank and in hand
2,439,914
246,669

Less: bank overdrafts
(18,779)
(1,717)

2,421,135
244,952



16.


Creditors: Amounts falling due within one year

2022
2021
£
£

Bank overdrafts
18,779
1,717

Bank loans
409,152
471,106

Trade creditors
765,852
808,887

Amounts owed to group undertakings
3,997,969
459,298

Other taxation and social security
607,131
541,449

Obligations under finance lease and hire purchase contracts
219,974
-

Other creditors
561,599
499,941

Accruals and deferred income
100,418
100,418

6,680,874
2,882,816


Secure Loans:
The bank loans are secured by fixed assets and a floating charge over the assets of the business.
The obligations under hire purchase contracts are secured on the assets to which they relate.


17.


Creditors: Amounts falling due after more than one year

2022
2021
£
£

Bank loans
604,428
944,457

Net obligations under finance leases and hire purchase contracts
748,182
-

1,352,610
944,457


Secure Loans:
The bank loans are secured by fixed assets and a floating charge over the assets of the business.
The obligations under hire purchase contracts are secured on the assets to which they relate.

Page 24

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

18.


Loans


Analysis of the maturity of loans is given below:


2022
2021
£
£

Amounts falling due within one year

Bank loans
409,152
471,106


409,152
471,106

Amounts falling due 1-2 years

Bank loans
409,152
409,152


409,152
409,152

Amounts falling due 2-5 years

Bank loans
195,276
535,305


195,276
535,305


1,013,580
1,415,563



19.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

2022
2021
£
£


Within one year
219,974
-

Between 1-5 years
748,182
-

968,156
-

Page 25

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

20.


Deferred taxation




2022


£






At beginning of year
180,000



At end of year
180,000

The deferred tax asset is made up as follows:

2022
2021
£
£


Tax losses carried forward
180,000
180,000

180,000
180,000


21.


Share capital

2022
2021
£
£
Allotted, called up and fully paid



10,000 (2021 - 10,000) Ordinary shares of £1.00 each
10,000
10,000



22.


Reserves

Other reserves

The Other Reserve consists of funds provided by the company's parent undertaking which are repayable solely at the discretion of the company.


23.


Contingent liabilities

The company has a contingent liability of £1,975,051 (2021: £Nil) in relation to security provided on the bank overdraft in Armstrong Teasdale Management Limited, a subsidiary undertaking.
The company is currently subject to an enquiry by the Solicitors Regulatory Authority (“SRA”) regarding its handling of a client account and whether it allowed transactions to be processed, in accordance with client instructions, that did not relate to legal matters. The SRA have proposed disposal of the allegations against the firm by way of a sanction of a financial penalty. The firm will soon be making representations as to a proportionate and commensurate financial penalty that could form the basis of a Regulatory Settlement Agreement with the SRA. Significant legal fees have been incurred for this matter which the company expects to be borne by its US parent undertaking.

Page 26

 
ARMSTRONG TEASDALE LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022

24.


Commitments under operating leases

At 31 December 2022 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2022
2021
£
£


Not later than 1 year
540,283
303,514

Later than 1 year and not later than 5 years
2,161,132
-

Later than 5 years
1,620,849
-

4,322,264
303,514


25.


Related party transactions

Included in creditors are amounts of £440,966 (2021: £444,510) due to companies controlled by the directors.
Included in creditors is an amount of £3,997,969 (2021: £417,329) due to a subsidiary company.
A director and a former director have given personal guarantee to £300,000 relating to certain of the bank loans.


26.


Controlling party

The company's immediate parent undertaking is Armstrong Teasdale (UK) Limited, Registered office 38-43 Lincoln’s Inn Fields, London WC2A 3PE.
The ultimate parent undertaking is Armstrong Teasdale LLP, incorporated in the USA. Registered office 7700 Forsyth Blvd, Ste. 1800, St. Loius, MO 63105.

 
Page 27