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Registered number: 02062398










LABLOGIC SYSTEMS LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2023

 
LABLOGIC SYSTEMS LIMITED
 
 
COMPANY INFORMATION


Directors
R A Brown 
J K Clapham 
P K Clapham 
E Zahirovic 
M L Grainger 




Company secretary
M Brown



Registered number
02062398



Registered office
Innovation House
6 Europa View

Sheffield

South Yorkshire

S9 1XH




Independent auditors
Shorts
Chartered Accountants & Statutory Auditor

2 Ashgate Road

Chesterfield

S40 4AA




Bankers
Virgin Money (Clyderdale Bank Plc)

Handelsbanken





 
LABLOGIC SYSTEMS LIMITED
 

CONTENTS



Page
Strategic report
 
1
Directors' Report
 
2 - 3
Independent Auditors' Report
 
4 - 7
Statement of Income and Retained Earnings
 
8
Balance Sheet
 
9
Notes to the Financial Statements
 
10 - 22

 
LABLOGIC SYSTEMS LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023

Introduction
 
The directors present their strategic report for the year ended 30 June 2023.

Business review
 
The directors report that the market in which the business operates remains competitive in the current economic climate, impacting on the margins achieved on many product lines and pre-tax profitability. 

Principal risks and uncertainties
 
Sales and Profit risk - the Company operates in a competitive market but retains a good market share and continues to outperform some of its rivals. The Company's aim is to continue growing its turnover by introducing new products and adding to existing ranges and services. 
Credit Risk - the Company mainly deals with well-established organisations with little risk; where there is risk it alters its payment terms so that the bulk of the debt is paid before delivery.
Liquidity Risk - the directors control and monitor the cash flow of the Company on a regular basis.
Foreign Exchange Rate Risk - the Company is not immune to changes in the global economic environment and subsequent fluctuations in foreign exchange rates. The directors reduce foreign exchange rate risk by holding funds in foreign exchange and chooses careful when to transfer them to sterling.
Employees  
In order to meet its objectives it is essential that the Company recruits and retains the higher calibre of employees at every level of the organisation. The employment policies of the Company embody the principles of equal opportunity. The Company gives full and fair consideration to employment for disabled persons. If an employee became disabled, arrangements would be made wherever practicable by identifying employment suited to that person's capabilities and provided necessary retraining. 

Financial key performance indicators
 
The company's key performance indicators for the year are as follows:
Turnover - £13,870,810 (2022: £10,448,781) 
Gross Profit - £7,932,036 (2022: £6,746,145)
Gross Margin - 57.2%  (2022: 64.6%)
Profit before tax - £2,035,785 (2022: £2,327,471)

Future developments and future strategy
 
The company continues to operate a sales strategy based on providing new model ranges and increasing and improving existing model ranges. The company continues to review and improve the performance of its products to ensure they remain one of the leading suppliers in the market. The company continues to look to increase its geographical market share by trading in a large number of countries. 


This report was approved by the board on 12 March 2024 and signed on its behalf.



R A Brown
Director
Page 1

 
LABLOGIC SYSTEMS LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023

The directors present their report and the financial statements for the year ended 30 June 2023.

Directors

The directors who served during the year were:

R A Brown 
J K Clapham 
P K Clapham 
E Zahirovic 
M L Grainger 

Directors' responsibilities statement

The directors are responsible for preparing the Strategic report, the Directors' report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation, amounted to £2,855,664 (2022 - £2,248,707).

The total distribution of dividends for the year ended 30 June 2023 was £NIL (2022: £2,000,000).

Directors' indemnity provisions

The directors have been granted a qualifying third party indemnity provision under Section 234 of the Companies Act 2006. This indemnity does not provide cover in the event of a director being proven to have acted fraudulently or dishonestly.

Page 2

 
LABLOGIC SYSTEMS LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and
the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Auditors

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

This report was approved by the board on 12 March 2024 and signed on its behalf.
 





R A Brown
Director
Page 3

 
LABLOGIC SYSTEMS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LABLOGIC SYSTEMS LIMITED
 

Opinion


We have audited the financial statements of Lablogic Systems Limited (the 'Company') for the year ended 30 June 2023, which comprise the Statement of income and retained earnings, the Balance sheet and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 30 June 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 United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Page 4

 
LABLOGIC SYSTEMS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LABLOGIC SYSTEMS LIMITED (CONTINUED)


Other information


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


Opinion on other matters prescribed by the Companies Act 2006
 

In our opinion, based on the work undertaken in the course of the audit:


the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

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


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 2, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 5

 
LABLOGIC SYSTEMS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LABLOGIC SYSTEMS LIMITED (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including
fraud and non-compliance with laws and regulations, was as follows:
 
the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
through discussions with the directors and other management and from our commercial knowledge and experience of the sectors that the Company operates in, we identified the laws and regulations applicable to
the Company; and
focusing on the specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Company, we assessed the extent of compliance with those laws and regulations identified above through making enquiries of management and inspecting relevant correspondence. 

We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
 
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations

To address the risk of fraud through management bias and override of controls, we:
 
performed analytical procedures to identify any unusual or unexpected relationships;
considered journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
 
agreeing financial statement disclosures to underlying supporting documentation;
enquiring of management as to actual and potential litigation and claims; and
reviewing any correspondence with HMRC, relevant regulators and the Company’s legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. 
 
Page 6

 
LABLOGIC SYSTEMS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LABLOGIC SYSTEMS LIMITED (CONTINUED)



Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Howard Freeman BSc FCA (Senior statutory auditor)
  
for and on behalf of
Shorts
 
Chartered Accountants
Statutory Auditor
  
2 Ashgate Road
Chesterfield
S40 4AA

12 March 2024
Page 7

 
LABLOGIC SYSTEMS LIMITED
 
 
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
Note
£
£

  

Turnover
 4 
13,870,810
10,448,781

Cost of sales
  
(5,111,844)
(3,702,636)

Gross profit
  
8,758,966
6,746,145

Administrative expenses
  
(7,444,349)
(5,237,494)

Other operating income
 5 
1,358,830
804,439

Operating profit
 6 
2,673,447
2,313,090

Interest receivable and similar income
  
189,268
14,381

Profit before tax
  
2,862,715
2,327,471

Tax on profit
 10 
(7,051)
(78,764)

Profit after tax
  
2,855,664
2,248,707

  

  

Retained earnings at the beginning of the year
  
8,183,227
7,934,520

Profit for the year
  
2,855,664
2,248,707

Dividends declared and paid
  
-
(2,000,000)

Retained earnings at the end of the year
  
11,038,891
8,183,227
The notes on pages 10 to 22 form part of these financial statements.
Page 8

 
LABLOGIC SYSTEMS LIMITED
REGISTERED NUMBER: 02062398

BALANCE SHEET
AS AT 30 JUNE 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 11 
109,223
29,254

Current assets
  

Stocks
 12 
477,496
526,370

Debtors: amounts falling due within one year
 13 
4,515,329
2,199,802

Cash at bank and in hand
  
12,371,323
13,090,239

  
17,364,148
15,816,411

Creditors: amounts falling due within one year
 14 
(3,032,645)
(4,466,975)

Net current assets
  
 
 
14,331,503
 
 
11,349,436

  

Accruals and deferred income
 15 
(3,396,835)
(3,190,463)

Net assets
  
11,043,891
8,188,227


Capital and reserves
  

Called up share capital 
 16 
5,000
5,000

Profit and loss account
 17 
11,038,891
8,183,227

  
11,043,891
8,188,227


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 12 March 2024.




R A Brown
Director

The notes on pages 10 to 22 form part of these financial statements.
Page 9

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

1.


General information

Lablogic Systems Limited is a private company limited by shares, incorporated in England and Wales (registered number: 02062398). Its registered office is Innovation House, 6 Europa View, Sheffield, South Yorkshire, England, S9 1XH. The principal activity of the Company throughout the year continued to be that of the design and production of scientific instruments and software.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The company, being a member of a group which prepares publicly available consolidated financial statements, has taken advantage of the exemption granted in FRS 102 not to present cash flow statement and certain information about financial instruments. The consolidated financial statements in which this company's accounts are included are those of Lablogic Group Holdings Limited and they may be obtained from its registered office at Innovation House, 6 Europa View, Sheffield, South Yorkshire, England, S9 1XH.

The following principal accounting policies have been applied:

  
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
 
the requirements of Section 7 Statement of Cash Flows;
 
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
 
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
 
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Lablogic Group Holdings Limited as at 30 June 2023 and these financial statements may be obtained from Companies House. 

Page 10

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.
Page 11

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.4

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

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:

Motor vehicles
-
25%
Fixtures and fittings
-
20%

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

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

 
2.5

Operating leases

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Stocks

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 balance sheet 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 profit or loss.
Page 12

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.7

Financial instruments

The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities such as bank and cash balances, trade and other accounts receivable and payable, loans from banks and other third parties and loans to and from related parties.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at the transaction price and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.

Financial assets and liabilities are offset and the net amount reported in the Balance sheet when there is an 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.

  
2.8

Foreign currency translation

Functional and presentation currency
The Company's functional and presentation currency is pounds sterling.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historic 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 the Statement of Income and Retained Earnings except when deferred in other comprehensive income as qualifying cashflow hedges.

 
2.9

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.

Page 13

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.10

Taxation

Tax is recognised in the Statement of Income and Retained Earnings.
The current tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Balance Sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

 
2.11

Research and development

Research and development expenditure is written off in the year in which it is incurred. 

 
2.12

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance sheet.

 
2.13

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

Page 14

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have the greatest level of uncertainty are addressed below:
(i) Impairment of debtors
The company makes an estimate of the recoverable value of trade debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the aging profile of debtors and historical experience. The amount of trade debtors after making such provision is presented per note 13 to the financial statements.
(ii) Stock provisioning
The company makes an estimate of the recoverable value of stock of finished goods and goods for resale. When assessing impairment of stock, management considers factors such as market conditions, aging profile of stock and historical experience. The amount of stock after making such provision is presented per note 12 to the financial statements.


4.


Turnover

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

Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
6,283,477
5,465,757

Rest of Europe
2,635,454
1,715,690

Rest of the world
4,951,879
3,267,334

13,870,810
10,448,781



5.


Other operating income

2023
2022
£
£

Management charges to group companies
1,358,830
804,439


Page 15

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation - plant and machinery
6,490
7,874

Depreciation - motor vehicles
31,006
27,995

Profit/loss on sale of tangible assets
(5,000)
(4,000)

Exchange differences
35,474
(783,076)


7.


Auditors' remuneration



2023
2022
£
£



Fees payable to the Company's auditors for the audit of the Company's
financial statements
18,250
16,000

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.

Page 16

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

8.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
4,463,411
4,049,602

Social security costs
720,991
622,006

Cost of defined contribution scheme
162,943
157,444

5,347,345
4,829,052


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Mangement and administration
21
19



Production and quality
30
30



Sales, service and support
23
20

74
69


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
2,984,011
2,907,099

Company contributions to defined contribution pension schemes
17,888
18,900

3,001,899
2,925,999


During the year retirement benefits were accruing to 4 directors (2022 - 4) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £683,473 (2022 - £674,359).

The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £1,333 (2022 - £3,892).

Page 17

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

10.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
7,051
78,764

Total current tax
7,051
78,764

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the calculated rate of corporation tax in the UK of 20.5% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
2,862,715
2,327,471


Profit on ordinary activities multiplied by calculated rate of corporation tax in the UK of 20.5% (2022 - 19%)
586,739
442,219

Effects of:


Expenses not deductible for tax purposes
5,765
21,872

Fixed asset differences
(372)
(17,338)

Utilisation of tax losses
-
(17,849)

Adjustment in research and development tax credit leading to a decrease in the tax charge
(385,668)
(350,473)

Changes in provisions leading to an increase / (decrease) in the tax charge
-
333

Marginal relief
(26)
-

Group relief
(200,068)
-

Remeasurement of deferred tax for changes in tax rates
(149)
-

Movement in deferred tax not recognised
830
-

Total tax charge for the year
7,051
78,764


Factors that may affect future tax charges

The Company's ongoing expenditure into research and development may result in minimal tax charges in the future.

Page 18

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

11.


Tangible fixed assets





Motor vehicles
Fixtures and fittings
Total

£
£
£



Cost or valuation


At 1 July 2022
166,437
193,329
359,766


Additions
117,465
-
117,465



At 30 June 2023

283,902
193,329
477,231



Depreciation


At 1 July 2022
149,231
181,281
330,512


Charge for the year on owned assets
31,006
6,490
37,496



At 30 June 2023

180,237
187,771
368,008



Net book value



At 30 June 2023
103,665
5,558
109,223



At 30 June 2022
17,206
12,048
29,254

Page 19

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

12.


Stocks

2023
2022
£
£

Raw materials and consumables
477,496
526,370



13.


Debtors

2023
2022
£
£


Trade debtors
2,534,117
1,492,369

Amounts owed by group undertakings
1,835,022
604,251

Other debtors
23,648
50,311

Prepayments and accrued income
122,542
52,871

4,515,329
2,199,802



14.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
241,848
509,050

Amounts owed to group undertakings
20,773
1,953,267

Corporation tax
7,051
78,764

Other taxation and social security
137,993
81,313

Other creditors
2,624,980
1,844,581

3,032,645
4,466,975



15.


Accruals and deferred income

2023
2022
£
£

Deferred income
3,396,835
3,190,463

Page 20

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

16.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022 - 100) Ordinary shares of £0.0025- each
0.25
0.25
1,999,900 (2022 - 1,999,900) B shares of £0.0025- each
4,999.75
4,999.75

5,000.00

5,000.00



17.


Reserves

Profit and loss account

The profit and loss account represents all current and prior retained profits and losses and is all considered to be distributable.


18.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £162,943 (2022: £157,444). Contributions totalling £24,965 (2022: £19,991) were payable to the fund at the balance sheet date and are included in creditors.


19.


Commitments under operating leases

At 30 June 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
80,000
80,000

Later than 1 year and not later than 5 years
57,500
137,500

137,500
217,500

Page 21

 
LABLOGIC SYSTEMS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

20.


Related party transactions

During the year the Company had the following transactions with Lablogic Systems Inc, a fellow subsidiary:


2023
2022
£
£

Sales
3,220,318
2,040,063
Purchases
195,734
84,791

In addition, cross charges of £975,561 were made from the Company to Lablogic Systems Inc during the year (2022: £480,895). The balance due from Lablogic Systems Inc at the year end was £18,397 (2022: debtor of £120,918).
The Company has taken advantage of exemption, under the terms of FRS 102, not to disclose related party transactions with other wholly owned subsidiaries within the group.


21.


Controlling party

The immediate and ultimate parent Company is Lablogic Group Holdings Limited, whose registered office address is Innovation House, 6 Europa View, Sheffield, South Yorkshire, England, S9 1XH. The group financial statements of Lablogic Group Holdings Limited are publicly available.
 
Page 22