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REGISTERED NUMBER: 02417402 (England and Wales)









STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

FOR

MAN AND MACHINE LIMITED

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

CONTENTS OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023










Page

Company Information 1

Strategic Report 2 to 3

Report of the Directors 4 to 5

Report of the Independent Auditors 6 to 9

Statement of Comprehensive Income 10

Statement of Financial Position 11

Statement of Changes in Equity 12

Statement of Cash Flows 13

Notes to the Statement of Cash Flows 14

Notes to the Financial Statements 15 to 24


MAN AND MACHINE LIMITED

COMPANY INFORMATION
FOR THE YEAR ENDED 31 DECEMBER 2023







DIRECTORS: Mr M U Hoellrich
Mr M Pech
Mr P Read





SECRETARY: Mr M U Hoellrich





REGISTERED OFFICE: Unit 8
Thame 40
Jane Morbey Road
Thame
Oxfordshire
OX9 3RR





REGISTERED NUMBER: 02417402 (England and Wales)





AUDITORS: Seymour Taylor Limited, Statutory Auditor
First Floor North
40 Oxford Road
High Wycombe
Buckinghamshire
HP11 2EE

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023


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

REVIEW OF BUSINESS
The company's key financial and performance indicators during the year were as follows:

2023 2022 Variance
£    £    %
Turnover 30,122,546 31,344,720 -3.90
Operating profit 1,998,576 2,255,813 -11.40
Profit before tax 2,053,655 2,254,334 -8.90
Shareholders' funds 3,396,569 3,039,914 11.70

Man and Machine continued to operate two distinct business units. The Value Added Reseller ("VAR") business sources market leading software from leading global vendors such as Autodesk, and augments the software with services to provide business solutions to its clients. The distribution part of the company (branded as "Elmtec") remains focused on its core skills, selling software and graphics card to a wide range of UK IT resellers.

During 2023 our company revenues declined slightly by 3.9%, due to some changes in the way our key vendors approached the market. This was not unexpected and was managed appropriately. Despite the changes, the VAR still won accolades from Autodesk during the year, such as the fastest growing reseller in EMEA in Q3.

Despite our slight revenue decline, our gross margins remained robust increasing by 1.6% to £7.172m. We also strengthened our balance sheet from £3.04m to £3.397m (increasing 11.7%) despite paying a £1.2m shareholder dividend to group, which masks an even greater improvement.

The VAR has an ever-widening new customer base and an increasing request from clients for more complex solutions to solve their business problems. This continues to be in relation to Building Information Modelling (BIM) and automated manufacturing solutions. The VAR has evidence that it continues to increase its UK market share in its core markets and is achieving growth figures above the UK market average. The VAR continues to operate as a leading Autodesk Platinum Partner and Elite Construction Partner - the highest accolade that can be achieved. It continues to experience positive demand and is confident in its ability to capitalise on the opportunities that this presents to the organisation over the coming months and years.

As Elmtec continues to evolve its business model, it will look for look for new opportunities and new products to extend its portfolio and customer base.



PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks and uncertainties facing the company are as follows:

Competitor risks
The company has recognised competitive risks from both alternative suppliers and software solutions. The company seeks to differentiate itself from competitors, providing value added expert services in addition to the supply of products. The company constantly monitors its competitive offering and adjusts as challenges present themselves.

Legislative and environmental risks
The directors have ensured that policies and procedures are in place to minimise the impact of legislative and environmental risks. The company considers its legislative and environmental requirements seriously and employs a number of specialist organisations to advise on compliance and implementation of effective strategies. The company holds ISO9001.




MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial risks
The company's bank debt incurs an interest charge dependent on the base rate, and thus is exposed to interest rate risk in this respect.

The directors seek to minimise credit risk by the use of credit insurance on its debtors.

The company uses invoice financing to provide sufficient cash flow for its business development and to reduce any liquidity risk.

The company has limited exposure to exchange rate risk, with a number of recoverable assets being non-sterling denominated, but the directors have ensured that this is monitored adequately to minimise losses.

ON BEHALF OF THE BOARD:





Mr P Read - Director


5 February 2024

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023


The directors present their report with the financial statements of the company for the year ended 31 December 2023.

PRINCIPAL ACTIVITY
The principal activities of the company in the year under review were:

(1) The value-added sale of software products and associated services (e.g. training, technical support and consulting) to end users primarily in the manufacturing, architectural and engineering industries.

(2) The distribution of graphics cards and software products to a customer base of CAD and IT resellers.

DIVIDENDS
An interim dividend of £48,000 per share was paid on 30 November 2023. The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31 December 2023 will be £ 1,200,000 .

FUTURE DEVELOPMENTS
The directors and staff continue on a carefully planned development programme supported by the company's ultimate parent company, Mensch und Maschine Software SE.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

Mr M U Hoellrich
Mr M Pech
Mr P Read

FINANCIAL INSTRUMENTS
The companies financial instruments policies are included within note 2 of the financial statements and the financial risk management objectives are included within the strategic report.

DIRECTORS' QUALIFYING THIRD PARTY INDEMNITY PROVISIONS
The company has granted indemnity to all directors and officers against liability in respect of proceedings brought by third parties, subject to the conditions set out in the Companies Act 2006. Such qualifying indemnity provision remains in place at the date of approving the directors report.




















MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), 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 and then apply them consistently;
- make judgements 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 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS
The auditors, Seymour Taylor Limited, will be re-appointed in accordance with section 487(2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:





Mr P Read - Director


5 February 2024

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
MAN AND MACHINE LIMITED


Opinion
We have audited the financial statements of Man and Machine Limited (the 'company') for the year ended 31 December 2023 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
MAN AND MACHINE LIMITED


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 Report of the Directors.

We have nothing to report in respect of the following matters where 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 Statement of Directors' Responsibilities set out on page five, 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 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.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
MAN AND MACHINE LIMITED


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 a Report of the Auditors 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.

Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities we considered the following:
- the nature of the industry and sector, control environment and business performance including the key drivers for directors' remuneration, bonus levels and performance targets;
- results of our enquiries of management about their own identification and assessment of the risks of irregularities;
- any matters we identified having made enquiries of management about their policies and procedures relating to:

identifying, evaluating and complying with laws and regulations and whether they were aware of any
instances of noncompliance;

detecting and responding to the risks of fraud and whether they have knowledge of any actual,
suspected or alleged fraud;

the internal controls established to mitigate risks of fraud or non-compliance with laws and
regulations;
- the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and local tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements, but compliance with which may be fundamental to the company's ability to operate.

Audit response to risks identified
As a result of performing the above our procedures to respond to the risks identified included the following:
- reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
- enquiring of management and external legal advisors about actual and potential litigation and claims;
- performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
- obtained an understanding of provisions and held discussions with management to understand the basis of recognition or non-recognition of tax provisions; and
- in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.


REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
MAN AND MACHINE LIMITED

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or noncompliance with laws and regulations throughout the audit.

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 Report of the Auditors.

Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors 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.




Timothy Fulker BSc FCA (Senior Statutory Auditor)
for and on behalf of Seymour Taylor Limited, Statutory Auditor
First Floor North
40 Oxford Road
High Wycombe
Buckinghamshire
HP11 2EE

5 February 2024

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023 2022
Notes £    £   

TURNOVER 3 30,122,546 31,344,720

Cost of sales 22,950,576 24,288,035
GROSS PROFIT 7,171,970 7,056,685

Administrative expenses 5,223,814 4,868,036
1,948,156 2,188,649

Other operating income 50,420 67,164
OPERATING PROFIT 5 1,998,576 2,255,813

Interest receivable and similar income 6 57,880 2,373
2,056,456 2,258,186

Interest payable and similar expenses 7 2,801 3,852
PROFIT BEFORE TAXATION 2,053,655 2,254,334

Tax on profit 8 497,000 457,863
PROFIT FOR THE FINANCIAL YEAR 1,556,655 1,796,471

OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

1,556,655

1,796,471

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2023

2023 2022
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 10 93,500 107,000
Tangible assets 11 455,854 264,272
Investments 12 2 2
549,356 371,274

CURRENT ASSETS
Stocks 13 598,448 555,923
Debtors 14 4,906,484 5,079,765
Cash at bank and in hand 2,460,658 2,281,224
7,965,590 7,916,912
CREDITORS
Amounts falling due within one year 15 4,253,127 5,202,102
NET CURRENT ASSETS 3,712,463 2,714,810
TOTAL ASSETS LESS CURRENT
LIABILITIES

4,261,819

3,086,084

CREDITORS
Amounts falling due after more than one
year

16

(793,188

)

-

PROVISIONS FOR LIABILITIES 18 (72,062 ) (46,170 )
NET ASSETS 3,396,569 3,039,914

CAPITAL AND RESERVES
Called up share capital 19 25 25
Retained earnings 20 3,396,544 3,039,889
SHAREHOLDERS' FUNDS 3,396,569 3,039,914

The financial statements were approved by the Board of Directors and authorised for issue on 5 February 2024 and were signed on its behalf by:





Mr P Read - Director


MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023

Called up
share Retained Total
capital earnings equity
£    £    £   
Balance at 1 January 2022 25 2,243,418 2,243,443

Changes in equity
Dividends - (1,000,000 ) (1,000,000 )
Total comprehensive income - 1,796,471 1,796,471
Balance at 31 December 2022 25 3,039,889 3,039,914

Changes in equity
Dividends - (1,200,000 ) (1,200,000 )
Total comprehensive income - 1,556,655 1,556,655
Balance at 31 December 2023 25 3,396,544 3,396,569

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023 2022
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 2,600,303 1,066,622
Interest paid (2,801 ) (3,852 )
Tax paid (872,708 ) -
Net cash from operating activities 1,724,794 1,062,770

Cash flows from investing activities
Purchase of tangible fixed assets (292,745 ) (138,498 )
Interest received 57,880 2,373
Net cash from investing activities (234,865 ) (136,125 )

Cash flows from financing activities
Increase/(decrease) in group balances (110,495 ) (13,167 )
Equity dividends paid (1,200,000 ) (1,000,000 )
Net cash from financing activities (1,310,495 ) (1,013,167 )

Increase/(decrease) in cash and cash equivalents 179,434 (86,522 )
Cash and cash equivalents at
beginning of year

2

2,281,224

2,367,746

Cash and cash equivalents at end of
year

2

2,460,658

2,281,224

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023


1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS
2023 2022
£    £   
Profit before taxation 2,053,655 2,254,334
Depreciation charges 114,460 84,012
Loss on disposal of fixed assets 203 3,142
Finance costs 2,801 3,852
Finance income (57,880 ) (2,373 )
2,113,239 2,342,967
Increase in stocks (42,525 ) (235,920 )
Decrease/(increase) in trade and other debtors 206,058 (2,263,905 )
Increase in trade and other creditors 323,531 1,223,480
Cash generated from operations 2,600,303 1,066,622

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2023
31.12.23 1.1.23
£    £   
Cash and cash equivalents 2,460,658 2,281,224
Year ended 31 December 2022
31.12.22 1.1.22
£    £   
Cash and cash equivalents 2,281,224 2,367,746


3. ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.23 Cash flow At 31.12.23
£    £    £   
Net cash
Cash at bank and in hand 2,281,224 179,434 2,460,658
2,281,224 179,434 2,460,658
Total 2,281,224 179,434 2,460,658

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023


1. GENERAL INFORMATION

Man and Machine Limited is a limited company incorporated in England and Wales under the Companies Act. The address of the registered office is Unit 8, Thame 40, Jane Morbey Road, Thame, Oxfordshire, OX9 3RR. The nature of the company's operations and its principal activities are set out in the directors' report on pages 4 to 5.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.

The financial statements are prepared in pounds sterling which is the functional currency of the company and rounded to the nearest pound.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Going concern
The financial statements have been prepared on the going concern basis, which the directors believe it is appropriate for the financial statements to be prepared on.

Preparation of consolidated financial statements
The financial statements contain information about Man and Machine Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 401 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the consolidated financial statements of its parent, Mensch und Maschine Software SE.

The group accounts of Mensch und Maschine Software SE are available to the public and can be obtained as set out in note 21.

Turnover
Turnover from the sale of goods is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on dispatch of the goods.

When the outcome of a transaction can be estimated reliably, turnover from the rendering of services is recognised by reference to the stage of completion at the statement of financial position date. Stage of completion is measured by reference to agreements with the customer.

Where the outcome cannot be measured reliably, turnover is recognised only to the extent of the expenses recognised that are recoverable.

Intangible assets
Intangible assets, being the amounts paid in connection with the acquisition of customer databases, are amortised evenly over the estimated useful life of ten years. Provision is made where necessary for any impairment.

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


2. ACCOUNTING POLICIES - continued

Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended.

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life:
.
Improvements to property - over the lease term
Fixtures and fittings - straight line - 20%
Motor vehicles - straight line - 20%
Computer equipment - straight line - 10% and 20%

Depreciation methods, useful lives and residual values are reviewed if there is an indication of a significant change since the last annual reporting date in the pattern by which the company expects to consume an asset's future economic benefits

Investments in subsidiaries
Investments in subsidiary undertakings are recognised at cost.

Stocks
Stock is stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the weighted average cost formula, stock is accounted for on a first in first out basis. Provision is made for damaged, obsolete and slow-moving stock where appropriate.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


2. ACCOUNTING POLICIES - continued

Pension costs and other post-retirement benefits
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to the statement of comprehensive income in the period to which they relate.

Operating lease agreements
Rentals payable under operating leases are charged in the statement of comprehensive income on a straight line basis over the lease term.

Financial instruments
The company has applied the provision of Section 11 'Basic Financial Instruments' and Section 12 'Other Financial Instrument Issues' of FRS 102 to all of its financial instruments.

Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Where the contractual obligations of financial instruments (including share capital) are equivalent to a similar debt instrument, those financial instruments are classed as financial liabilities. Financial liabilities are presented as such in the statement of financial position. Finance costs and gains or losses relating to financial liabilities are included in the statement of comprehensive income. Finance costs are calculated so as to produce a constant rate of return on the outstanding liability.

Where the contractual terms of share capital do not have any terms meeting the definition of a financial liability then this is classed as an equity instrument. Dividends and distributions relating to equity instruments are debited direct to equity.

Impairment of financial assets
At each period end date, the company reviews the carrying amounts of its financial assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount is reduced to its recoverable amount, with the impairment recognised immediately in the statement of comprehensive income.

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

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

The areas for which estimation has been applied are considered to be in calculating depreciation, impairments and provisions. Although these areas are subject to judgement, they are not considered to be subject to significant estimation.

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


3. TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by class of business is given below:

2023 2022
£    £   
Sale of products 28,859,168 30,102,776
Rendering of services 1,263,378 1,241,944
30,122,546 31,344,720

An analysis of turnover by geographical market is given below:

2023 2022
£    £   
United Kingdom 29,429,787 30,689,280
Europe 654,899 567,320
Rest of world 37,860 88,120
30,122,546 31,344,720

4. EMPLOYEES AND DIRECTORS
2023 2022
£    £   
Wages and salaries 3,253,372 3,201,185
Social security costs 405,494 401,338
Other pension costs 217,108 128,566
3,875,974 3,731,089

The average number of employees during the year was as follows:
2023 2022

Office and management 6 5
Sales and technical 46 49
52 54

2023 2022
£    £   
Directors' remuneration 256,036 343,517
Directors' pension contributions to money purchase schemes 58,400 8,400

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes 1 1

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


4. EMPLOYEES AND DIRECTORS - continued

Information regarding the highest paid director is as follows:
2023 2022
£    £   
Emoluments etc 256,036 343,517
Pension contributions to money purchase schemes 58,400 8,400

Emoluments in respect of two of the directors have been borne by the immediate parent company, Mensch und Maschine Software SE. These directors are also directors of other companies within the Mensch und Maschine group. The directors do not consider that they have received any remuneration for the incidental services to the company for the years ended 31 December 2023 and 31 December 2022.

Mensch und Maschine Software SE charge Man and Machine Limited royalties. These charges include costs borne by the group which relate to those directors providing services to Man and Machine Limited.

5. OPERATING PROFIT

The operating profit is stated after charging:

2023 2022
£    £   
Depreciation - owned assets 100,960 70,512
Loss on disposal of fixed assets 203 3,142
Customer base amortisation 13,500 13,500
Auditors' remuneration 30,355 29,650
Foreign exchange differences 30,620 32,376
Operating lease rentals - Land and buildings 61,064 48,816

6. INTEREST RECEIVABLE AND SIMILAR INCOME
2023 2022
£    £   
Bank account interest 57,880 2,373

7. INTEREST PAYABLE AND SIMILAR EXPENSES
2023 2022
£    £   
Loan interest 2,801 3,852

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


8. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
2023 2022
£    £   
Current tax:
UK corporation tax 471,108 375,000

Deferred tax 25,892 82,863
Tax on profit 497,000 457,863

UK corporation tax has been charged at 25% (2022 - 19%).

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
£    £   
Profit before tax 2,053,655 2,254,334
Profit multiplied by the standard rate of corporation tax in the UK of
25% (2022 - 19%)

513,414

428,323

Effects of:
Expenses not deductible for tax purposes (7,478 ) (5,559 )
Capital allowances in excess of depreciation (8,936 ) -
Depreciation in excess of capital allowances - 35,099
Total tax charge 497,000 457,863

The corporation tax main rate increased from 19% to 25% for periods commencing 1 April 2023, with the small profits rate remaining at 19%.

9. DIVIDENDS
2023 2022
£    £   
Ordinary shares of £1 each
Interim 1,200,000 1,000,000

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


10. INTANGIBLE FIXED ASSETS
Customer
base
£   
COST
At 1 January 2023
and 31 December 2023 135,000
AMORTISATION
At 1 January 2023 28,000
Amortisation for year 13,500
At 31 December 2023 41,500
NET BOOK VALUE
At 31 December 2023 93,500
At 31 December 2022 107,000

11. TANGIBLE FIXED ASSETS
Improvements Fixtures
to and Computer
property fittings equipment Totals
£    £    £    £   
COST
At 1 January 2023 375,038 497,486 270,393 1,142,917
Additions 121,442 85,163 86,140 292,745
Disposals (68,448 ) (54,474 ) (226,741 ) (349,663 )
At 31 December 2023 428,032 528,175 129,792 1,085,999
DEPRECIATION
At 1 January 2023 355,773 280,664 242,208 878,645
Charge for year 13,368 81,381 6,211 100,960
Eliminated on disposal (68,448 ) (54,271 ) (226,741 ) (349,460 )
At 31 December 2023 300,693 307,774 21,678 630,145
NET BOOK VALUE
At 31 December 2023 127,339 220,401 108,114 455,854
At 31 December 2022 19,265 216,822 28,185 264,272

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


12. FIXED ASSET INVESTMENTS
Shares in
group
undertakings
£   
COST
At 1 January 2023
and 31 December 2023 2
NET BOOK VALUE
At 31 December 2023 2
At 31 December 2022 2

The company's investments at the Statement of Financial Position date in the share capital of companies include the following:


Elmtec Distribution Limited
Registered office: Unit 8 Thame 40, Jane Morbey Road, Thame, Oxfordshire, OX9 3RR
Nature of business: Dormant company
%
Class of shares: holding
Ordinary 100.00
2023 2022
£    £   
Aggregate capital and reserves 2 2

13. STOCKS
2023 2022
£    £   
Finished goods 598,448 555,923

14. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
£    £   
Trade debtors 4,256,559 4,465,205
Amounts owed by group undertakings 11,626 5,967
Other debtors 449,059 511,014
Corporation tax 27,118 -
Prepayments and accrued income 162,122 97,579
4,906,484 5,079,765

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
£    £   
Trade creditors 2,450,398 3,695,771
Amounts owed to group undertakings 40,489 145,325
Corporation tax - 374,482
Social security and other taxes 112,298 115,090
VAT 470,172 504,703
Accruals and deferred income 1,179,770 366,731
4,253,127 5,202,102

16. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR
2023 2022
£    £   
Accruals and deferred income 793,188 -

17. LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:
2023 2022
£    £   
Within one year 66,170 -
Between one and five years 264,680 -
In more than five years 5,514 -
336,364 -

18. PROVISIONS FOR LIABILITIES

Deferred tax
20232022
£   £   
At 1 January 46,170(36,693)
Tax losses utilised in the year-55,402
Other timing differences25,89227,461
At 31 December 72,06246,170

Deferred tax balances have been measured with reference to the rate of tax expected to be applicable as the date of reversal.

19. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2023 2022
value: £    £   
25 Ordinary £1 25 25

MAN AND MACHINE LIMITED (REGISTERED NUMBER: 02417402)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


20. RESERVES
Retained
earnings
£   

At 1 January 2023 3,039,889
Profit for the year 1,556,655
Dividends (1,200,000 )
At 31 December 2023 3,396,544

Called up share capital - This represents the nominal value of shares that have been issued.

Retained earnings - This reserve contains the profit and loss for the year and accumulated profits and losses brought forward.

21. ULTIMATE PARENT COMPANY

The directors consider that Mensch und Maschine Software SE, a company incorporated in Germany, is the company's ultimate and controlling parent company.

The parent undertaking of the smallest and largest group of which Man and Machine Limited is a
member is Mensch und Maschine Software SE, a company incorporated in Germany. The only group
preparing consolidated group financial statements, which include Man and Machine Limited, is Mensch und Maschine Software SE . The directors consider Mensch und Maschine Software SE to be the company's immediate parent company.

Copies of the financial statements of Mensch und Maschine Software SE, can be obtained from the Company Secretarial Department, Mensch und Maschine Software SE, Argelsrieder Feld 5, D - 82234 Wessling, Germany.

22. RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

During the year, the company entered into the following transactions with related parties:


2023 2022
£ £
Key management personnel compensation 558,047 619,482

The amounts outstanding at the year end are £94,850 (2022 - £145,341).