Tinius Olsen Limited
Registered number: 00998521
Annual Report
For the year ended 31 December 2023
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TINIUS OLSEN LIMITED
COMPANY INFORMATION
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6 Perrywood Business Park
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Chartered Accountants & Statutory Auditor
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TINIUS OLSEN LIMITED
CONTENTS
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Directors' Responsibilities Statement
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Independent Auditor's Report
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Consolidated Statement of Comprehensive Income
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Consolidated Statement of Financial Position
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Company Statement of Financial Position
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Consolidated Statement of Changes in Equity
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Company Statement of Changes in Equity
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Consolidated Statement of Cash Flows
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Consolidated Analysis of Net Debt
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Notes to the Financial Statements
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TINIUS OLSEN LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The Directors present their strategic report together with the audited consolidated financial statements for Tinius Olsen Limited (the 'Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023.
In presenting this report the financial statements consolidate the results of Tinius Olsen Limited ("the Company"), its subsidiary undertaking Tinius Olsen India Pvt Limited incorporated in India and its subsidiary undertaking Tinius Olsen Testing Machine Company Shanghai Ltd incorporated in the Peoples Republic of China. The Group made a profit before taxation of £1,207,117 (2022: loss of £351,981) for the year ended 31 December 2023. The underlying performance of the Company made a profit before taxation of £1,076,308 (2022: loss of £409,400). The Company will be able to maintain positive cash balances for the foreseeable future and therefore the going concern basis of accounting has been adopted.
Principal risks and uncertainties
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The Directors consider that the key business risk remains competition and as such this continues to be monitored by a regular review of market share and margins. Continuing economic uncertainty in the world is a consideration and as such will be monitored as to any affect this may have on the business.
Economic impact of global events
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UK businesses are facing many uncertainties and challenges caused by political, economic, social, technological, legal and environmental factors. These uncertainties have contributed to an environment where there exists a range of issues and risks, including inflation, rising interest rates, labour shortages, disrupted supply chains and new ways of working.
The Directors have carried out an assessment of the potential impact of these uncertainties on the business, including the impact of mitigation measures, and concluded that the greatest impact on the business is expected to be from the economic ripple effect on the global economy. The Directors have taken account of these potential impacts in their going concern assessment.
The Company continues to work with its partners to minimise any impacts of these events and maximise the realisation of any opportunities they may provide to the business.
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TINIUS OLSEN LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Financial key performance indicators
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The board utilises a number of key performance indicators to enable consistent method of analysing performance. The key performance indicators, which are used by the board are as follows:
Gross profit margin performance for all customers
Gross profit margin measures the profit achieved on sales after taking account of the direct cost incurred for each customer. These trends are closely monitored and help ensure that all customer relationships are sustainable. This has reduced to 57% compared with last year 2022: 60%.
Revenue
Revenue measures the level of turnover with customers, after taking account trade discounts. In a normal trading year, this is used to compare performance against prior years and forecasts. In 2022, the Group experienced supply chain shortages for certain components necessary to ship higher capacity and price machines. In 2023, supply chain shortages were not as prevalent resulting in turnover with customers that was 8% higher than our 2021 results. Comparison to 2021 is more relevant given the anomalies that existed in 2022.
Net profit performance
The net profit performance measures the net profit achieved after taking account the total costs incurred including both direct and indirect cost i.e. profit on ordinary activities after taxation. This is used to compare the Group's performance against prior year and forecasts, this year's net profit performance is 9.6% (2022: loss of 3.7%, 2021: profit of 13.2%).
Current ratio performance
The current ratio measures that the Group has sufficient current assets to cover its current liability and used in the measurement of the Group's liquidity. The current ratio is currently at 1.91 (2022: 2.23).
Working capital requirements are met principally out of retained profits. In addition, trade debtors and trade creditors arise directly from the Group's operations. The Group does not enter into any hedging arrangements.
Credit risk and currency risk arise from the Group's activities. The Group's policy in respect of credit risk is to require appropriate credit checks on potential customers before sales are made, where possible. The Group's policy in respect of currency risk is to invoice primarily in sterling. These risks are monitored by the board of Directors and were not considered to be significant at the Statement of Financial Position date.
The Group's policy in respect of interest rate risk and liquidity risk is to maintain a readily accessible bank deposit accounts to ensure the Group has sufficient funds for operations. The cash deposits are held in current accounts which earn interest at a floating rate. Debt is currently maintained at a fixed interest rate with the parent Company, Tinius Olsen International Company. The Directors monitor the liquidity and cash flow of the Group carefully.
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TINIUS OLSEN LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
This report was approved by the board and signed on its behalf by:
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TINIUS OLSEN LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their annual report and the audited consolidated financial statements of Tinius Olsen Limited (the 'Company') for the year ended 31 December 2023.
The principal activity of the Group and Company during the year was that of producers of load test equipment.
The Group profit for the year, after taxation, amounted to £870,707 (2022: loss of £222,194).
The directors do not recommend the payment of a dividend (2022: £nil).
The directors who served during the year and to the date of this report were:
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S L Elliott (appointed 20 March 2023)
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The Group continues to run an extensive research and development programme which, in the opinion of the directors, is essential for the growth of the business.
As permitted by the Companies Act 2006, the Company has indemnified the directors and officers in respect of proceedings which may be brought by third parties and such indemnification was in place throughout the year and at the date of approval of these financial statements. Neither the Company's indemnity nor insurance provides cover in the event that a director or officer is proved to have acted fraudulently or dishonestly.
Matters covered in the Group Strategic Report
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The Group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the Group'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 financial instruments.
Provision of information to auditors
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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 and the Group's auditor is 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 and the Group's auditor is aware of that information.
Post balance sheet events
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There have been no significant events affecting the Company and Group since the year end.
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TINIUS OLSEN LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The auditor, Mazars LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf by:
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TINIUS OLSEN LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated audited consolidated financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare audited consolidated financial statements for each financial year. Under that law the directors have elected to prepare the audited consolidated 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 audited consolidated financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these audited consolidated financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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TINIUS OLSEN LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TINIUS OLSEN LIMITED
Opinion
We have audited the financial statements of Tinius Olsen Limited (the ‘Company’) for the year ended 31 December 2023 which comprise the Consolidated Statement of Comprehensive Income, the Group and Company Statements of Financial Position, the Group and Company Statements of Changes in Equity, the Group Consolidated Statement of Cash Flows 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 Group's and of the Parent Company’s affairs as at 31 December 2023 and of the Group's 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.
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TINIUS OLSEN LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TINIUS OLSEN 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.
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TINIUS OLSEN LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TINIUS OLSEN LIMITED
Responsibilities of Directors
As explained more fully in the Directors' Responsibilities Statement set out on page 5, 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 intend either 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 these 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 and anti-money laundering regulation.
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.
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TINIUS OLSEN LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TINIUS OLSEN LIMITED
In addition, we evaluated the directors' and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of override of controls, and determined that the principal risks were related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to revenue recognition (which we pinpointed to the occurrence 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.
Yuvan Deena (Senior statutory auditor)
for and on behalf of Mazars LLP
Chartered Accountants and Statutory Auditor
2nd Floor
6 Sutton Plaza
Sutton Court Road
Sutton
SM1 4FS
15 April 2024
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TINIUS OLSEN LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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Interest receivable and similar income
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Interest payable and similar expenses
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Profit/(loss) before taxation
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Profit/(loss) for the financial year
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Currency translation differences gains/(losses)
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Other comprehensive income/(expense) for the year
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Total comprehensive income/(expense) for the year
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Profit/(loss) for the year attributable to:
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Owners of the parent Company
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Total comprehensive income/(expense) for the year attributable to:
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Owners of the parent Company
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The Consolidated Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.
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The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
REGISTERED NUMBER: 00998521
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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TINIUS OLSEN LIMITED
REGISTERED NUMBER: 00998521
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2023
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Capital contribution reserve
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
REGISTERED NUMBER: 00998521
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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TINIUS OLSEN LIMITED
REGISTERED NUMBER: 00998521
COMPANY STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2023
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Capital contribution reserve
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The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements. The profit after tax of the parent company for the year was £761,079 (2022: loss of £244,636).
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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Capital contribution reserve
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Comprehensive income for the year
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Currency translation differences
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Other comprehensive expense for the year
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Total comprehensive income for the year
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Total transactions with owners
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Comprehensive income for the year
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Currency translation differences
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Other comprehensive expense for the year
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Total comprehensive expense for the year
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Total transactions with owners
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The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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Capital contribution reserve
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Comprehensive income for the year
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Other comprehensive income for the year
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Total comprehensive income for the year
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Total transactions with owners
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Comprehensive expense for the year
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Other comprehensive income for the year
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Total comprehensive income for the year
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Total transactions with owners
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The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
Cash flows from operating activities
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Profit/(loss) for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Impairments of fixed assets
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(Increase)/decrease in debtors
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Revaluation surplus on investment property
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of unlisted investment
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Purchase of tangible fixed assets
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Sale of tangible fixed assets
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Net cash from investing activities
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Cash flows from financing activities
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Repayment of/new finance leases
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Capital element of lease repaid
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Repayment of intercompany loans
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Net cash used in financing activities
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TINIUS OLSEN LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
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Net (decrease) in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023
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Repayment of finance leases
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The notes on pages 21 to 47 form part of these financial statements.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Tinius Olsen Limited (the "Company") is a private company limited by shares, and incorporated in England and Wales. The address of its registered office is 6 Perrywood Business Park, Honeycrock Lane, Salfords, Redhill, Surrey, RH1 5DZ.
The principal activity of the Group and Company during the year was that of producers of load test equipment.
2.Accounting policies
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Basis of preparation of financial statements
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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 Group management to exercise judgement in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income and Statement of Cashflows in these financial statements.
The financial statements have been presented in Pounds Sterling as this is the currency of the primary economic environment in which the Group and Company operates and is rounded to the nearest pound.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
The year end of Tinius Olsen-India Private Limited is 31 March. The consolidated financial statements incorporates Tinius Olsen-India Private Limited results as at 31 December 2023.
Having considered the basis of preparation and the underlying assumptions of the Group's forecast for the twelve months following the approval of these financial statements, the directors have a reasonable expectation that the Group will be able to meet its liabilities as they fall due during that period of time. It is on this basis that the directors consider it appropriate to prepare the financial statements on a going concern basis for at least 12 months from the date of signing.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentation 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 Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in Statement of Comprehensive Income within 'administrative expenses'.
On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.
Turnover represents sales to outside customers at invoiced amounts less value added tax or local taxes on sales and is recognised when the risks and rewards of ownership has passed to the customer. These criteria are considered to be met when the goods are dispatched.
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Operating leases: the Group as lessee
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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.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Leased assets: the Group as lessee
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Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
All research and development costs are written of as incurred.
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Interest receivable and similar income
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Interest receivable and similar income is recognised in Statement of Comprehensive Income using the effective interest method.
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Interest payable and similar expenses
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Interest payable and similar expenses are charged to Statement of Comprehensive Income 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.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss 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 Group in independently administered funds.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. 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 and the Group operate and generate 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;
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
∙Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.
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.
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. Amortisation charge for the year is included within administrative expenses.
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.
Amortisation is charged to administrative expenses in the Statement of Comprehensive Income.
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 Group 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.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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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:
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Fixtures and fittings (larger items)
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Fixtures and fittings (smaller items)
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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 in the Statement of Comprehensive Income.
Investment property is carried at fair value determined annually by external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in Statement of Comprehensive Income.
Investments in subsidiaries and other unlisted investments are measured at cost less accumulated impairment.
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. Work in progress and finished goods include labour and 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.
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.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Cash and cash equivalents
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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.
In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.
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.
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Group 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 Group 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.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
The Group 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 Group's Statement of Financial Position when the Group 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 Group'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 Statement of Comprehensive Income.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Financial instruments (continued)
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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 Group after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies 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 Group 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 Group 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 Group's contractual obligations expire or are discharged or cancelled.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Judgements in applying accounting policies and key sources of estimation uncertainty
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Critical judgements in applying the Company's accounting policies
The critical judgements that the directors have made in the process of applying the Company's accounting policies that have the most significant effect on the statutory financial statements are discussed below.
(i) Assessing indicators of impairment
In assessing whether there have been any indicators of impairment assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. There have been no indicators of impairments identified during the current financial year.
Key sources of estimation uncertainty
(i) Valuation of investment properties
The Company obtain regular third party valuations, from qualified valuers. Where necessary, these are updated based on lease terms, market conditions and sales prices based upon known market transactions for similar properties as a basis for determining the directors' estimation of the fair value of the investment properties. However, the valuation of the Group's investment property is inherently subjective, as it is made on the basis of valuation assumptions.
(ii) Stock valuation and provision
Stock is reviewed annually with reference to current and new products along with recent sales history of the related products.
The Directors have considered whether the net realisable value of inventory was lower than the carrying value. Slow-moving, excess and obsolete inventory are reviewed and provided for as necessary. The Directors, having reviewed the run off of inventory subsequent to the year end and the prices achieved have concluded that its net realisable value was not materially lower than the net carrying value at year end.
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An analysis of turnover by geographical location is as follows:
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All turnover arose from the same class of business.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Other operating income relates to commission income which is a direct charge from the US.
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The operating profit is stated after (crediting)/charging:
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Research & development charged as an expense
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Gains on foreign exchange differences
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Depreciation of tangible assets
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Amortisation of intangible assets
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Revaluation surplus on investment property
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Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Staff costs were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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The Company currently contributes to a Group personal pension plan, which is a defined contribution scheme. The assets of the plan are held separately from those of the Company in an independently administered fund. Then pension cost charge also includes contributions payable by the Company to this fund.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Company contributions to defined contribution pension schemes
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There were 3 directors in the Company's defined contribution pension scheme during the year (2022: 2).
Emoluments of the highest paid director was £182,159 (2022: £176,104). Company pension contributions of £29,772 (2022: £27,596) were made to a defined contribution scheme on his behalf. The director received benefits in kind of £nil (2022: £nil).
Key management personnel is considered to be the board of directors and total compensation paid to key management personnel is equal to directors' remuneration.
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Interest receivable and similar income
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Other interest receivable
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Interest payable and similar expenses
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Interest payable on intercompany balances
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Current tax on profits for the year
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Adjustments in respect of previous periods
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Foreign tax on income for the year
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Foreign tax in respect of prior periods
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Effect of tax rate change on opening balance
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Adjustments in respect of prior periods
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Taxation on profit/(loss)
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
12.Tax on profit/(loss) (continued)
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2022: lower than) the standard rate of corporation tax in the UK of 23.52% (2022:19%). The differences are explained below:
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Profit/(loss) multiplied by standard rate of corporation tax in the UK of 23.52% (2022: 19%)
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Expenses not deductible for tax purposes
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Capital allowances for year in excess of depreciation
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Adjustments to tax charge in respect of previous periods
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Adjustments to tax charge in respect of previous periods - deferred tax
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Additional deduction for R&D expenditure
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Chargeable gains/(losses)
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Income not taxable for tax purposes
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Total tax charge for the year
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Factors that may affect future tax charges
|
In the Spring Budget 2021, the Government announced that from 1 April 2023 the corporation tax rate will increase to 25%. Since the proposal to increase the rate to 25% had not been substantively enacted at the balance sheet date, its effects are not included in these financial statements. However, it is likely that the overall effect of the change, had it been substantively enacted by the balance sheet date, would be small.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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The net book value of land and buildings may be further analysed as follows:
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
14.Tangible fixed assets (continued)
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The net book value of land and buildings may be further analysed as follows:
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Investments in subsidiary companies
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In the prior year, Tinius Olsen Limited (“Company”, “Investor”, “Lender”) invested £310,000 and £310,000, respectively, for a 17.69% diluted basis in Imetrum. The Investor contributed capital for the upside in Imetrum’s optical extensometry product line (“Vector”), directly as it relates to the materials testing industry.
A loan of £3,440,000 was provided to Imetrum and interest of £195,339 was charged in 2023.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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The following were subsidiary undertakings of the Company:
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Tinius Olsen India Private Limited
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Tinius Olsen India Pvt. Ltd., 59 H (A, Noida Special Economy Zone, Block A, Phase-2, Noida, Uttar Pradesh 201305, India
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Producers of load test equipment
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Tinius Olsen Testing Machine Company Shanghai Limited
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Tinius Olsen Testing Machine Company Shanghai Ltd, Building No. 2, No. 123 Lane 1165, Jindu Road, Minhang District, Shanghai, China
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Producers of load test equipment
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The aggregate of the share capital and reserves as at 31 December 2023 and the profit or loss for the year ended on that date for the subsidiary undertakings were as follows:
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Aggregate of share capital and reserves
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Tinius Olsen India Private Limited
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Tinius Olsen Testing Machine Company Shanghai Limited
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Freehold investment property
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The 2023 valuations were made by Vail Williams LLP, who are registered with the Royal Institution of Chartered Surveyors (RICS) at Red Book Valuation on an open market value for existing use basis.
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If the Investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:
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Raw materials and consumables
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Work in progress (goods to be sold)
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Finished goods and goods for resale
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The difference between purchase price or production cost of stocks and their replacement cost is not material.
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During the year, a stock provision of £359,539 (2022: £296,990) was recognised.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Debtors: amounts falling due within one year
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Amounts owed by group undertakings
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Prepayments and accrued income
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Deferred taxation (note 25)
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During the year, a bad debt provision of £45,697 (2022: £45,697) was recognised.
Amounts owed by group undertakings are unsecured, interest free and repayable on demand.
Amounts owed by group undertakings relate to entities outside of the UK Group and therefore not eliminated in these consolidated accounts.
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Cash and cash equivalents
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Creditors: amounts falling due within one year
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Amounts owed to group companies
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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Included within trade creditors is an amount due to Tinius Olsen International Company of £nil (2022: £819,419), relating to stock purchased from the ultimate parent.
Included within other creditors is a leave provision of £53,814 (2022: £51,830). Refer to note 24.
Amounts owed to group undertakings, other than the loan from Tinius Olsen International Company are unsecured, interest free and repayable on demand.
Amounts owed to group undertakings relate to entities outside of the UK Group and therefore not eliminated in these consolidated accounts.
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Creditors: amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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Amounts due to parent undertakings
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts due to parent undertakings
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Amounts falling due 1-2 years
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Amounts due to parent undertakings
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Amounts falling due 2-5 years
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Amounts due to parent undertakings
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Amounts due to parent undertaking comprise one loan of £314,535 (2022: £405,637).
The long-term loan attracts interest at 5.5% and is payable by equal monthly installments commencing 1 January 2007. The redemption date is January 2027.
The long-term loans are secured against, with a right of set off against, any and all present, future and after acquired funds, monies, balances, stocks, bonds, notes, deposit accounts, and other personal property of any nature whatsoever in which the Company has any interest.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Minimum lease payments under hire purchase fall due as follows:
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Balance as at 1 January 2023
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Amount debited through Statement of Comprehensive Income
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The balance is included within accruals and deferred income at year end.
Provisions relates to leave provision for employees. Leave provision is for leave encashment for leave given to the employees and gratuity which is a long term employee benefit given to employees as per gratuity act in India. Gratuity is paid to the employees after they leave the Company if they served the Company for more than 5 years.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Charged to the Statement of Comprehensive Income
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Charged the Statement of Comprehensive Income
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The deferred taxation balance is made up as follows:
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Accelerated capital allowances
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Losses and other deductions
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Accelerated capital allowances are expected to be realised within the next 5 years.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Allotted, called up and fully paid
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18,000 (2022: 18,000) ordinary shares of £1.00 each
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Ordinary shares carry voting rights, but no right to fixed income.
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Share premium account
This reserve records the amount above the nominal value received for shares sold, less transaction costs.
Profit and loss account
This reserve represents the cumulative profits and losses of the Group and the Company.
Capital contribution reserve
This reserve represents the revaluation of freehold property.
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Commitments under operating leases
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At 31 December the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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29.Other commitments
At the year-end, Tinius Olsen India PVT Ltd has given bank guarantees to VAT authority Special Economic Zone against fixed deposit amounts of 1,085KINR (£10.23k).
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Related party transactions
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At 31 December 2023 the Company was a wholly owned subsidiary of Tinius Olsen Limited, and as such has taken advantage of the exemption permitted by Section 33 ‘Related party disclosures’ not to provide disclosures of transactions entered into with other wholly owned members of the Group.
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TINIUS OLSEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Post balance sheet events
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There have been no significant events affecting the Company and Group since the year end.
At 31 December 2023, the Company's ultimate parent company was Tinius Olsen International Company, a company incorporated in the United States of America, which is the parent of both the smallest and largest groups of which the Company is included in the consolidated accounts.
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