Company registration number 02735000 (England and Wales)
ROBORE CUTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
ROBORE CUTS LIMITED
COMPANY INFORMATION
Directors
J Lewington
(Appointed 30 November 2023)
S T Rickus
(Appointed 30 November 2023)
J A Villiers
(Appointed 30 November 2023)
T Wicks
(Appointed 30 November 2023)
P E Nattrass
(Appointed 30 November 2023)
Company number
02735000
Registered office
Unit 16
Mitcham Industrial Estate
Streatham Road
Mitcham
Surrey
CR4 2AP
Auditor
Clarkson Hyde LLP
3rd Floor
Chancery House
St Nicholas Way
Sutton
Surrey
SM1 1JB
Business address
Unit 16
Mitcham Industrial Estate
Streatham Road
Mitcham
Surrey
CR4 2AP
ROBORE CUTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 23
ROBORE CUTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -
The directors present the strategic report for the year ended 30 June 2023.
Review of the business
The principal activity of the company continued to be the provision of diamond drilling and sawing, passive fire protection and other related services to the construction industry.
During the year turnover increased by 28% compared to the previous year due to increased activity as the construction sector recovered from the Covid pandemic. Increases in administrative expenses were contained at 9% during the year resulting in an operating profit of £716k and a profit before tax of £666k.
Principal risks and uncertainties
The principal risks to the business were considered. The directors believed that increases in the cost of labour and other direct expenses could impact the company’s profitability.
It was concluded that the identified risks could be managed. Activity in the construction industry had recovered and the company could look forward to another profitable year.
P E Nattrass
Director
5 March 2024
ROBORE CUTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
The directors present their annual report and financial statements for the year ended 30 June 2023.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid during the year. The director does not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
J Lewington
(Appointed 30 November 2023)
D Rickus
(Resigned 30 November 2023)
S T Rickus
(Appointed 30 November 2023)
J A Villiers
(Appointed 30 November 2023)
T Wicks
(Appointed 30 November 2023)
P E Nattrass
(Appointed 30 November 2023)
Auditor
In accordance with the company's articles, a resolution proposing that Clarkson Hyde LLP be reappointed as auditor of the company will be put at a General Meeting.
Statement of disclosure to auditor
So far the director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the director has taken all the necessary steps that he ought to have taken as director in order to make himself aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Post balance sheet events
Subsequent to the year-end, the company underwent a management buyout which completed on 30 November 2023.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
P E Nattrass
Director
5 March 2024
ROBORE CUTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -
The directors are responsible for preparing the annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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.
ROBORE CUTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF ROBORE CUTS LIMITED
- 4 -
Opinion
We have audited the financial statements of Robore Cuts Limited (the 'company') for the year ended 30 June 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the 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).
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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. 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 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.
ROBORE CUTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF ROBORE CUTS LIMITED
- 5 -
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 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, 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.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
We focussed on laws and regulations which could give rise to material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. There are inherent limitations in the audit procedures described above, and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relation to irregularities, including fraud. As in all of our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
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.
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
ROBORE CUTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF ROBORE CUTS LIMITED
- 6 -
Graham Speck
Senior Statutory Auditor
For and on behalf of Clarkson Hyde LLP
Chartered Accountants
Statutory Auditor
3rd Floor
Chancery House
St Nicholas Way
Sutton
Surrey
SM1 1JB
ROBORE CUTS LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
9,450,935
7,396,109
Cost of sales
(6,523,109)
(5,617,020)
Gross profit
2,927,826
1,779,089
Administrative expenses
(2,259,596)
(2,076,374)
Other operating income
48,000
136,250
Operating profit/(loss)
4
716,230
(161,035)
Interest receivable and similar income
6
1,592
795
Interest payable and similar expenses
7
(51,447)
(37,549)
Profit/(loss) before taxation
666,375
(197,789)
Tax on profit/(loss)
8
(157,347)
(13,739)
Profit/(loss) for the financial year
509,028
(211,528)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
ROBORE CUTS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 8 -
2023
2022
£
£
Profit/(loss) for the year
509,028
(211,528)
Other comprehensive income
-
-
Total comprehensive income for the year
509,028
(211,528)
ROBORE CUTS LIMITED
BALANCE SHEET
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
661,110
585,438
Investment property
10
700,000
700,000
Investments
11
2
2
1,361,112
1,285,440
Current assets
Debtors
12
5,482,947
5,334,784
Investments
13
9,561
9,561
Cash at bank and in hand
481,652
302,018
5,974,160
5,646,363
Creditors: amounts falling due within one year
14
(1,455,571)
(1,533,622)
Net current assets
4,518,589
4,112,741
Total assets less current liabilities
5,879,701
5,398,181
Creditors: amounts falling due after more than one year
15
(709,036)
(784,415)
Provisions for liabilities
Deferred tax liability
18
47,871
(47,871)
-
Net assets
5,122,794
4,613,766
Capital and reserves
Called up share capital
20
2
2
Profit and loss reserves
5,122,792
4,613,764
Total equity
5,122,794
4,613,766
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.true
The financial statements were approved by the board of directors and authorised for issue on 5 March 2024 and are signed on its behalf by:
P E Nattrass
Director
Company registration number 02735000 (England and Wales)
ROBORE CUTS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 July 2021
2
4,825,292
4,825,294
Year ended 30 June 2022:
Loss and total comprehensive income
-
(211,528)
(211,528)
Balance at 30 June 2022
2
4,613,764
4,613,766
Year ended 30 June 2023:
Profit and total comprehensive income
-
509,028
509,028
Balance at 30 June 2023
2
5,122,792
5,122,794
ROBORE CUTS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
23
532,242
(35,281)
Interest paid
(51,447)
(37,549)
Income taxes refunded/(paid)
14,250
(39,300)
Net cash inflow/(outflow) from operating activities
495,045
(112,130)
Investing activities
Purchase of tangible fixed assets
(26,588)
(74,856)
Proceeds from disposal of tangible fixed assets
110,139
59,417
Interest received
1,592
795
Net cash generated from/(used in) investing activities
85,143
(14,644)
Financing activities
Repayment of bank loans
(144,940)
(67,600)
Payment of finance leases obligations
(255,614)
(237,177)
Net cash used in financing activities
(400,554)
(304,777)
Net increase/(decrease) in cash and cash equivalents
179,634
(431,551)
Cash and cash equivalents at beginning of year
302,018
733,569
Cash and cash equivalents at end of year
481,652
302,018
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 12 -
1
Accounting policies
Company information
Robore Cuts Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 16, Mitcham Industrial Estate, Streatham Road, Mitcham, Surrey, CR4 2AP.
1.1
Accounting convention
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 freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discounts.
Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the profit and loss account turnover and related costs as contract activity progresses. Turnover is calculated as that proportion of total contract value comparing costs to date to total expected costs for that contract.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
25% straight line
Motor vehicles
25% straight line
Other assets
25% straight line
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 credited or charged to profit or loss.
1.5
Investment property
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
1.6
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 13 -
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include 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.
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 14 -
Other financial assets
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.
Impairment of financial assets
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.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.
Classification of financial liabilities
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 company after deducting all of its liabilities.
Basic financial 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
Equity instruments
Equity instruments issued by the company 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 company.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 15 -
Current 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
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 when the company has 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.
1.12
Employee benefits
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
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 leases asset are consumed.
1.15
Government grants
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.
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 16 -
1.16
Foreign exchange
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.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are 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.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Primary activity
9,450,935
7,396,109
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
9,450,935
7,396,109
2023
2022
£
£
Other revenue
Interest income
1,592
795
Grants received
-
38,250
4
Operating profit/(loss)
2023
2022
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Government grants
-
(38,250)
Fees payable to the company's auditor for the audit of the company's financial statements
20,055
17,000
Depreciation of owned tangible fixed assets
100,686
147,587
Depreciation of tangible fixed assets held under finance leases
208,538
138,059
Profit on disposal of tangible fixed assets
(97,816)
(59,411)
Operating lease charges
4,546
3,759
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 17 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Administration
15
14
Direct labour
49
48
Workshop
7
7
Maintenance
1
1
Fire protection
2
2
Total
74
72
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
3,610,082
3,211,823
Social security costs
410,045
372,356
Pension costs
67,815
63,209
4,087,942
3,647,388
6
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
1,592
795
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
27,207
20,918
Other finance costs:
Interest on finance leases and hire purchase contracts
24,240
16,631
51,447
37,549
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
90,063
(39,353)
Other taxes
4,150
Total current tax
94,213
(39,353)
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
8
Taxation
2023
2022
£
£
(Continued)
- 18 -
Deferred tax
Origination and reversal of timing differences
63,134
53,092
Total tax charge
157,347
13,739
The actual charge 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:
2023
2022
£
£
Profit/(loss) before taxation
666,375
(197,789)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
126,611
(37,580)
Tax effect of expenses that are not deductible in determining taxable profit
17,409
18,848
Tax effect of utilisation of tax losses not previously recognised
(7,214)
Unutilised tax losses carried forward
7,214
Change in unrecognised deferred tax assets
63,134
53,092
Effect of change in corporation tax rate
6,573
Group relief
38,801
Permanent capital allowances in excess of depreciation
(34,738)
(55,490)
Profit on disposal of fixed assets
(18,585)
(11,288)
Other tax adjustments
4,150
Other timing differences
7
142
Taxation charge for the year
157,347
13,739
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 19 -
9
Tangible fixed assets
Plant and machinery
Motor vehicles
Other assets
Total
£
£
£
£
Cost
At 1 July 2022
4,994,990
1,516,503
140,000
6,651,493
Additions
83,428
313,791
397,219
Disposals
(1,512,880)
(305,026)
(1,817,906)
At 30 June 2023
3,565,538
1,525,268
140,000
5,230,806
Depreciation and impairment
At 1 July 2022
4,709,992
1,216,064
139,999
6,066,055
Depreciation charged in the year
142,804
166,420
309,224
Eliminated in respect of disposals
(1,500,557)
(305,026)
(1,805,583)
At 30 June 2023
3,352,239
1,077,458
139,999
4,569,696
Carrying amount
At 30 June 2023
213,299
447,810
1
661,110
At 30 June 2022
284,998
300,439
1
585,438
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and machinery
134,501
149,257
Motor vehicles
433,906
231,719
568,407
380,976
10
Investment property
2023
£
Fair value
At 1 July 2022 and 30 June 2023
700,000
11
Fixed asset investments
2023
2022
£
£
Unlisted investments
2
2
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 20 -
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,716,572
1,743,827
Corporation tax recoverable
39,953
58,353
Amounts owed by group undertakings
3,264,014
3,130,845
Other debtors
162,447
162,323
Prepayments and accrued income
299,961
224,173
5,482,947
5,319,521
2023
2022
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 18)
15,263
Total debtors
5,482,947
5,334,784
13
Current asset investments
2023
2022
£
£
Listed investments carrying amount
9,561
9,561
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
16
145,509
144,940
Obligations under finance leases
17
216,095
171,208
Trade creditors
340,016
748,146
Corporation tax
90,063
Other taxation and social security
125,028
122,759
Other creditors
16,471
32,819
Accruals and deferred income
522,389
313,750
1,455,571
1,533,622
15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
367,899
513,408
Obligations under finance leases
17
341,137
271,007
709,036
784,415
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 21 -
16
Loans and overdrafts
2023
2022
£
£
Bank loans
513,408
658,348
Payable within one year
145,509
144,940
Payable after one year
367,899
513,408
The long-term loan relates to a mortgage on the company's development property. The mortgage is secured by the charge over the company's development property. The company guarantees the mortgage which Ideal Time Ltd has with the bank.
It should be noted that, subsequent to the year-end, these loans were repaid in full on 13 October 2023.
17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
216,095
171,208
In two to five years
341,137
271,007
557,232
442,215
Finance lease payments represent rentals payable by the company for certain items of plant and machinery and motor vehicles. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
18
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Balances:
£
£
£
£
Accelarated capital allowances
49,290
-
-
-
Decelerated capital allowances
-
-
-
4,361
Retirement benefit obligations
(1,419)
-
-
-
Pension contributions
-
-
-
1,410
Other timing differences
-
-
-
9,492
47,871
-
-
15,263
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
18
Deferred taxation
(Continued)
- 22 -
2023
Movements in the year:
£
Asset at 1 July 2022
(15,263)
Charge to profit or loss
63,134
Liability at 30 June 2023
47,871
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
67,815
63,209
The company complies with the auto enrolment legislation and operates a pension scheme to which the majority of staff and the company contribute. The assets of the scheme are held separately from those of the company in independently administered funds. The pension cost charge represents contributions payable by the company. 3 employees also make payments to individual stakeholder schemes which the company does not contribute to.
20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
2
2
2
2
21
Related party transactions
Included within other debtors is an amount of £65,732 (2022: £57,645), due from D Rickus, a director during the year.
22
Ultimate controlling party
As at 30 June 2023, the ultimate parent company was Ideal Time Limited, a company registered in England and Wales.
As at 30 June 2023, D Rickus was the ultimate controlling party by virtue of his 100% shareholding in the ultimate parent company, Ideal Time Limited.
Subsequent to the year-end, the company underwent a management buyout.
ROBORE CUTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 23 -
23
Cash generated from/(absorbed by) operations
2023
2022
£
£
Profit/(loss) for the year after tax
509,028
(211,528)
Adjustments for:
Taxation charged
157,347
13,739
Finance costs
51,447
37,549
Investment income
(1,592)
(795)
Gain on disposal of tangible fixed assets
(97,816)
(59,411)
Depreciation and impairment of tangible fixed assets
309,224
285,646
Movements in working capital:
Increase in debtors
(181,826)
(227,787)
(Decrease)/increase in creditors
(213,570)
127,306
Cash generated from/(absorbed by) operations
532,242
(35,281)
24
Analysis of changes in net debt
1 July 2022
Cash flows
New finance leases
30 June 2023
£
£
£
£
Cash at bank and in hand
302,018
179,634
-
481,652
Borrowings excluding overdrafts
(658,348)
144,940
-
(513,408)
Obligations under finance leases
(442,215)
255,614
(370,631)
(557,232)
(798,545)
580,188
(370,631)
(588,988)
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