The director presents the strategic report for the year ended 31 March 2023.
The Group is a UK based supplier of pipework, fittings, and precision engineering products to the utility and other sectors as well providing services for manufacture and machining of steel fabrications. Most of the company's business is in the area of sustainable products which enable customers to build and manage pipeline networks.
The Group has built a strong UK market position within their individual market niches, and several are market leaders. It is the strategy of the Group to build specialist positions in markets where customers recognise the added value of our products and services.
The directors remain optimistic about sustaining activity levels throughout 2023/2024, albeit with expected cost increases.
Further growth and profitability are expected throughout 2023/24 as trading conditions continue to return to normality following a sustained period of restrictions as a result of the COVID-19 pandemic.
Revenue for 2023 of £20.56m is a 1.90% increase on 2022 (£20.17m). Despite rising costs, the profitability of the work mix has mitigated the impact of the cost increases seen during the year. This has contributed to the operating profit produced of £2.27m (2022: £249k).
This is after deducting exceptional costs of £123k (2022: £891k) relating to amounts invested into other related party business interests, whereby the benefit is not expected to be recognised until future financial years. Excluding this amount, operating profits of £2.39m (2022: £1.14m) would otherwise have been achieved.
The Group has an established, structured approach to risk management. The Groups activities expose it to a variety of financial risks, including effects of credit, liquidity and cash flow and foreign currency risk. The Group has adopted risk management policies that seek to mitigate these risks in a cost-effective manner. Financial assets that expose the Group to financial risk consist primarily of trade debtors and cash. Financial liabilities that expose the Group to financial risk consist principally of trade creditors and intercompany loan agreements.
Credit risk is the loss in the value of financial assets due to counterparties failing to meet all or part of their obligations. The Group performed ongoing credit evaluation of its customers' financial condition.
Liquidity risk is the risk that the Group does not have sufficient liquid assets to meet its obligations as they fall due. Liquidity is maintained at a prudent level and the Group ensure there is adequate liquidity buffer to cover contingencies.
Economic risk is the risk faced from fluctuations in currency, shifts in government policy and new regulations at home and abroad. Events in Ukraine continue to pose a potential economic risk in particular with regards to energy costs. To mitigate such risks, a strategic project has been undertaken during 2023/24 which will see the install of a solar powered system at the largest energy intense site which wil generate a good proportion of that site's energy use. Any adverse cost implications while this project is being completed will be passed on if unable to be absorbed by the Group to ensure the Group can sustain profitability whilst also ensuring products and services remain competitive and of value.
The Group strategic positioning will be enhanced by the recruitment and development of talented people, fostering an innovative and entrepreneurial culture. We will dedicate management and sales focus for its market sectors in order to be more agile as these markets evolve. We wish to build stronger customer relationships and continuous development of well-established routes to market.
UTS Engineering Limited will be further bolstered throughout 2023/24 as the benefit is derived from work fulfilled under new contracts and framework agreements.
The significant synergies of the Ulrich Attachments Limited acquisition are also expected to be realised during 2023/24 along with LCR Engineering Limited.
Turnover and EBITDA are the Group’s chosen key performance indicators.
2023 2022 2021 2020
Turnover £20.6m £20.1m £18.6m £14.3m
EBITDA £3.0m £0.9m £0.8m £2.0m
EBITDAE* £3.2m £1.9m £2.4m £2.7m
*(EBITDA plus exceptional items)
On behalf of the board
The director presents his annual report and financial statements for the year ended 31 March 2023.
The results for the year are set out on page 8.
No ordinary dividends were paid. The director does not recommend payment of a further dividend.
The director who held office during the year and up to the date of signature of the financial statements was as follows:
The auditor, Azets Audit Services, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
We have audited the financial statements of Shaun Sadler Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including 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).
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 group and parent 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 director's 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 group's and parent 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 director 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 director is 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. 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 our audit:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company 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.
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is responsible for assessing the parent 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 director either intends to liquidate the parent company or to cease operations, or has no realistic alternative but to do so.
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.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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 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.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £694,348 (2022 - £30 loss).
Shaun Sadler Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Connor House, Pilgrims Way, Bede Industrial Estate, Jarrow, Tyne & Wear, United Kingdom, NE32 3EW.
The group consists of Shaun Sadler Holdings Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of certain fixed assets. The principal accounting policies adopted are set out below.
The consolidated group financial statements consist of the financial statements of the parent company Shaun Sadler Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 March 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
At the time of approving the financial statements, the director has a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
Other fixed asset investments have been accounted for using the revaluation model as per section 17 of FRS 102. The carrying value of the other fixed asset investments are carried at a revalued amount, being its fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
In the application of the group’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount 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 to be 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
The determination of the work in progress provision required to estimate the stage of completion of contracts. The carrying amount of work in progress at the year end was £389,493 (2023: £94,592).
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The actual credit for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Leasehold property with a carrying value of £1,215,200 was revalued at 31 March 2021 by BNP Paribas Real Estate, independent valuers and RICS Qualified Chartered Surveyors not connected with the company on the basis of in-situ market value.
Plant and machinery with a carrying amount of £3,453,067 was revalued at 31 March 2021 by Walker Singleton Chartered Surveyors, independent valuers and RICS Qualified Chartered Surveyors not connected with the company on the basis of in-situ market value.
Motor vehicles with a carrying amount of £600,000 were revalued on 14 April 2021 on the basis of market value as part of a refinancing exercise with Close Brothers Finance.
If revalued assets were stated at an historical cost basis, the total amounts included would be as follows:
The fixed asset investment held in UTS Engineering Limited relating to a motor vehicle with book cost of £175,000 was revalued to £350,000 at 26 July 2023 by Graypaul Ferrari Nottingham, independent valuers not connected with the company on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar motor vehicles.
The fixed asset investment held in Shaun Sadler Holdings Limited relating to a motor vehicle with a book cost of £368,284 was revalued to £470,000 at 15 August 2023 by Lamborghini Pangbourne, independent valuers not connected with the company on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar motor vehicles.
Details of the company's subsidiaries at 31 March 2023 are as follows:
Included within other creditors is £2,323,177 (2022: £2,494,382) of factored debts outstanding at the balance sheet date. These are secured against the debtors to which the balance relates.
Debenture including fixed charges over all present freehold and leasehold property; and first floating charge over all assets and undertaking both present and future dates 20 December 2019 in favour of Pulse Cashflow Finance Limited.
Debenture including fixed charges over all present freehold and leasehold property; and first floating charge over all assets and undertaking both present and future dates 4 September 2014 in favour of Pulse Cashflow Finance Limited.
Debenture including fixed charges over all present freehold and leasehold property; first fixed charge over book debts and other debts, chattels, goodwill, and uncalled capital, both present and future; and first floating charge over all assets and undertaking both present and future dated 2 September 2014 in favour of Pulse Cashflow Finance Limited.
First legal charge dated 10 September 2014 over leasehold property known as 20 Pilgrims Way, Bede Industrial Estate, Jarrow, Tyne & Wear, in favour of Pulse Cashflow Finance Limited.
Debenture including fixed charges over all present freehold and leasehold property; and first floating charge over all assets and undertaking both present and future dates 22 August 2014 in favour of Pulse Cashflow Finance Limited.
Fixed and floating charge dated 23 November 2012 over the undertaking and all property and assets present and future, including goodwill, book debts, uncalled capital, buildings, fixtures, fixed plant & machinery in favour of Aldermore Invoice Finance, a division of Aldermore Bank plc.
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
At the year end the Group had a balance of £1,398,810 (2022: £1,694,774), within other debtors, due from Chandelier's by Annette Limited, a company related by common control. At the balance sheet date, a provision of £500,000 (2022: £320,000) was recognised within this balance.
At the year end the Group had a balance of £764,734 (2022: £1,448,258) within other debtors, due from UTS Engineering Services, a company related by common control. At the balance sheet date, a provision of £937,893 (2022: £1,112,844) was recognised within this balance.
At the year end the Group had a balance of £Nil (2022: £10,942) due from Conlaureb Holdings Limited, a company related by common control.
At the year end the Group had a balance of £Nil (2022: £28,971) due from UTS Engineering for Pipelines, a company related by common control.
Interest free loans have been granted by the group to its directors as follows:
Within UTS Engineering Limited, the company has reallocated a motor vehicle held for investment which was originally recorded within the overdrawn Directors loan account. The asset was acquired 17 December 2021 under a hire purchase contract with three payments having been made up to the end of the prior year.
In accordance with FRS 102, the addition of the investment and the hire purchase obligation along with the reallocation of payments from the overdrawn Directors loan account, has resulted in the company restating its comparatives for the 2022 financial year.
In summary the following adjustments were made to the amounts recognised in the balance sheet at the date of initial application (1 April 2022) and the beginning of the earliest period presented (1 April 2021).
The adjustments to the overdrawn Directors loan account of £13,657 to reallocate the hire purchase payments made on the motor vehicle held for investment, reduces the previously reported balance for the year ended 31 March 2022. As a result the revised overdrawn Directors loan account balance is £3,687,220 as at 31 March 2022.
The resulting reduction of the overdrawn Directors loan account reduces the amount of S455 tax owed by the director and to HMRC by £4,609 for the year ended 31 March 2022. As a result the revised S455 tax debtor and corporation tax payable balance is £1,198,176 and £491,075 respectively.
The adjustments to the hire purchase liability of £161,343, increases the previously reported balance for the year ended 31 March 2022. As a result the revised hire purchase liability is £1,367,850 as at 31 March 2022.
The recognition of the motor vehicle held for investment of £175,000, increases the previously reported balance for the year ended 31 March 2022. As a result the revised investments balance is £175,000 as at 31 March 2022.
The adjustment to hire purchase interest payable of £5,034 is the net effect of the reallocation of the £13,657 hire purchase payments out of the overdrawn Directors loan account to the hire purchase liability less the capital element of those payments totalling £8,623.