REGISTERED NUMBER: 11703755 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 30 JUNE 2023 |
FOR |
COMMUTO UK LTD. |
REGISTERED NUMBER: 11703755 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 30 JUNE 2023 |
FOR |
COMMUTO UK LTD. |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS |
for the year ended 30 June 2023 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Directors | 3 |
Report of the Independent Auditors | 4 |
Consolidated Income Statement | 7 |
Consolidated Other Comprehensive Income | 8 |
Consolidated Balance Sheet | 9 |
Company Balance Sheet | 10 |
Consolidated Statement of Changes in Equity | 11 |
Company Statement of Changes in Equity | 12 |
Consolidated Cash Flow Statement | 13 |
Notes to the Consolidated Cash Flow Statement | 14 |
Notes to the Consolidated Financial Statements | 15 |
COMMUTO UK LTD. |
COMPANY INFORMATION |
for the year ended 30 June 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants |
Statutory Auditor |
Unit 2, Charnwood Edge Business Park |
Syston Road |
Leicestershire |
LE7 4UZ |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
GROUP STRATEGIC REPORT |
for the year ended 30 June 2023 |
The directors present their strategic report of the company and the group for the year ended 30 June 2023. |
REVIEW OF BUSINESS |
The group trades ten (10) automotive repair shops under the Fix Auto brand, supporting the strength of the Fix Auto relationships with insurance partners. |
PRINCIPAL RISKS AND UNCERTAINTIES |
MARKET RISK |
The group's main risks derive from the uncertainty in the UK economy that could affect performance in its operations, as well as leading to supply chain and inflationary pressures. In addition, there is a potential impact to staffing resource in the UK market. This has not had a significant impact on the group in the period although there is an increased risk of supply chain disruptions and wider economic disruption that may impact margins in the future. The group has a strong customer base through Fix Auto, reducing its exposure to a temporary downturn in trade. |
STAFF RISK |
The group also faces risk in relation to the retention of staff and labour shortages in its subsidiaries. The group's subsidiaries provide a competitive pay structure which is designed to retain staff. The main staff risk stems from retention of workshop staff which is being countered by the group continuing to modify and review terms and conditions of employment relative to the wider market. |
LIQUIDITY RISK |
Liquidity risk arises from the group's management of working capital. It is the risk that that Group will encounter difficulty in meeting its financial obligations as they fall due. |
The directors have reviewed the cash flow statements of the business. The procurement of parts through an associated company means that the risk of default on external financial obligations is considered very low. |
GOING CONCERN |
The directors have assessed the financial position of the group. The equity position of the group was noted but the directors are agreed that with unwavering support confirmed from the owners, and through both direct shareholder loans and associated company credit terms, that the business continues to be a going concern and will be able to operate for the foreseeable future. |
KEY PERFORMANCE INDICATORS |
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the company, these being turnover and operating profit. |
The group's turnover has increased from £13,379,609 to £17,384,672. |
POST BALANCE SHEET POSITION AND SUBSEQUENT EVENTS |
The year started positively, with trading results in the year to date continuing to improve monthly. Operating profit has been positive in each month of the year so far and improvements in turnover and cost management are being worked on constantly. |
On August 1 2023, Commuto UK Limited, acquired 90% of the shares in K&R Vehicle Solutions Ltd. This state of the art bodyshop is expected to be strong contributor to group performance. |
ON BEHALF OF THE BOARD: |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
REPORT OF THE DIRECTORS |
for the year ended 30 June 2023 |
The directors present their report with the financial statements of the company and the group for the year ended 30 June 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the group in the year under review was that of a holding company and business support service activities. |
DIVIDENDS |
No dividends will be distributed for the year ended 30 June 2023. |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 July 2022 to the date of this report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
AUDITORS |
The auditors, Magma Audit LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
COMMUTO UK LTD. |
Opinion |
We have audited the financial statements of Commuto UK Ltd. (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 June 2023 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the group's and of the parent company affairs as at 30 June 2023 and of the group's loss 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 were not appointed as auditor of the group until after 30 June 2022 and thus did not observe the counting of physical inventories at the end of that year. We were unable to satisfy ourselves by alternative means concerning the inventory quantities held, cut off, and valuation at 30 June 2022, which are included in the balance sheet at £565,804, by using other audit procedures. Consequently we were unable to determine whether any adjustment to this amount was necessary. |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs UK)) ad applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified 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 group's and the 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 directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
COMMUTO UK LTD. |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept 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. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page three, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the group's and 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 directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so. |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Based on our understanding of the company and the industry, we have identified the principal risks of non-compliance with laws and regulations, and we have considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting inappropriate journal entries, and management bias in accounting estimates. Audit procedures performed included: |
- | Enquiries with management for consideration of known or suspected instances of non-compliance with laws and regulations and fraud. |
- | Challenging assumptions made by management in their significant accounting estimates, in particular bad debt provision. |
- | Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations, journal entries crediting revenue, journal entries crediting cash and journal entries with specific defined descriptions. |
There are inherent limitations in the audit procedures described above and the further removed non-compliant with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting in error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentation, or through 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 Report of the Auditors. |
Other matters which we are required to address |
There was no requirement for the audit of the financial statements in the prior period. The comparatives are therefore unaudited. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
COMMUTO UK LTD. |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Chartered Accountants |
Statutory Auditor |
Unit 2, Charnwood Edge Business Park |
Syston Road |
Leicestershire |
LE7 4UZ |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
CONSOLIDATED |
INCOME STATEMENT |
for the year ended 30 June 2023 |
2023 | 2022 |
Notes | £ | £ |
TURNOVER | 3 | 17,384,672 | 13,379,609 |
Cost of sales | (11,524,270 | ) | (8,752,216 | ) |
GROSS PROFIT | 5,860,402 | 4,627,393 |
Administrative expenses | (6,552,901 | ) | (5,052,291 | ) |
(692,499 | ) | (424,898 | ) |
Other operating income | - | 15,000 |
OPERATING LOSS | 5 | (692,499 | ) | (409,898 | ) |
Interest receivable and similar income | 3,618 | 2,830 |
(688,881 | ) | (407,068 | ) |
Interest payable and similar expenses | 6 | (113,015 | ) | (25,057 | ) |
LOSS BEFORE TAXATION | (801,896 | ) | (432,125 | ) |
Tax on loss | 7 | - | 13,073 |
LOSS FOR THE FINANCIAL YEAR | ( |
) | ( |
) |
Loss attributable to: |
Owners of the parent | (770,240 | ) | (404,852 | ) |
Non-controlling interests | (31,656 | ) | (14,200 | ) |
(801,896 | ) | (419,052 | ) |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
CONSOLIDATED |
OTHER COMPREHENSIVE INCOME |
for the year ended 30 June 2023 |
2023 | 2022 |
Notes | £ | £ |
LOSS FOR THE YEAR | (801,896 | ) | (419,052 | ) |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
(801,896 |
) |
Prior year adjustment | (28,834 | ) |
TOTAL COMPREHENSIVE INCOME SINCE LAST ANNUAL REPORT |
(447,886 |
) |
Total comprehensive income attributable to: |
Owners of the parent | (770,240 | ) | (433,686 | ) |
Non-controlling interests | (31,656 | ) | (14,200 | ) |
(801,896 | ) | (447,886 | ) |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
CONSOLIDATED BALANCE SHEET |
30 June 2023 |
2023 | 2022 |
Notes | £ | £ |
FIXED ASSETS |
Intangible assets | 9 | 239,244 | 261,700 |
Tangible assets | 10 | 623,729 | 719,808 |
Investments | 11 | - | - |
862,973 | 981,508 |
CURRENT ASSETS |
Stocks | 12 | 758,974 | 565,804 |
Debtors | 13 | 2,652,403 | 1,754,986 |
Cash at bank | 368,222 | 242,936 |
3,779,599 | 2,563,726 |
CREDITORS |
Amounts falling due within one year | 14 | (7,356,452 | ) | (5,374,327 | ) |
NET CURRENT LIABILITIES | (3,576,853 | ) | (2,810,601 | ) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
(2,713,880 |
) |
(1,829,093 |
) |
CREDITORS |
Amounts falling due after more than one year |
15 |
(125,780 |
) |
(208,671 |
) |
PROVISIONS FOR LIABILITIES | 18 | (7,098 | ) | (7,098 | ) |
NET LIABILITIES | (2,846,758 | ) | (2,044,862 | ) |
CAPITAL AND RESERVES |
Called up share capital | 19 | 230 | 230 |
Retained earnings | 20 | (2,752,878 | ) | (1,982,638 | ) |
SHAREHOLDERS' FUNDS | (2,752,648 | ) | (1,982,408 | ) |
NON-CONTROLLING INTERESTS | (94,110 | ) | (62,454 | ) |
TOTAL EQUITY | (2,846,758 | ) | (2,044,862 | ) |
The financial statements were approved by the Board of Directors and authorised for issue on 8 April 2024 and were signed on its behalf by: |
I J Pugh - Director |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
COMPANY BALANCE SHEET |
30 June 2023 |
2023 | 2022 |
Notes | £ | £ |
FIXED ASSETS |
Intangible assets | 9 |
Tangible assets | 10 |
Investments | 11 |
CURRENT ASSETS |
Debtors | 13 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 14 | ( |
) | ( |
) |
NET CURRENT LIABILITIES | ( |
) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Retained earnings | 20 | 84,760 |
SHAREHOLDERS' FUNDS |
Company's loss for the financial year | (79,823 | ) | (15,619 | ) |
The financial statements were approved by the Board of Directors and authorised for issue on |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
for the year ended 30 June 2023 |
Called up |
share | Retained | Non-controlling | Total |
capital | earnings | Total | interests | equity |
£ | £ | £ | £ | £ |
Balance at 1 July 2021 | 230 | (1,548,952 | ) | (1,548,722 | ) | (48,254 | ) | (1,596,976 | ) |
Prior year adjustment | - | (28,834 | ) | (28,834 | ) | - | (28,834 | ) |
As restated | 230 | (1,577,786 | ) | (1,577,556 | ) | (48,254 | ) | (1,625,810 | ) |
Changes in equity |
Total comprehensive income | - | (404,852 | ) | (404,852 | ) | (14,200 | ) | (419,052 | ) |
Balance at 30 June 2022 | 230 | (1,982,638 | ) | (1,982,408 | ) | (62,454 | ) | (2,044,862 | ) |
Changes in equity |
Total comprehensive income | - | (770,240 | ) | (770,240 | ) | (31,656 | ) | (801,896 | ) |
Balance at 30 June 2023 | 230 | (2,752,878 | ) | (2,752,648 | ) | (94,110 | ) | (2,846,758 | ) |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
for the year ended 30 June 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 July 2021 |
Prior year adjustment | - | ( |
) | ( |
) |
As restated |
Changes in equity |
Total comprehensive income | - |
Balance at 30 June 2022 |
Prior year adjustment | - | ( |
) | ( |
) |
As restated |
Changes in equity |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 30 June 2023 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
CONSOLIDATED CASH FLOW STATEMENT |
for the year ended 30 June 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | 787,210 | (609,268 | ) |
Interest paid | (113,015 | ) | (25,057 | ) |
Tax paid | 14,831 | 4,046 |
Net cash from operating activities | 689,026 | (630,279 | ) |
Cash flows from investing activities |
Purchase of intangible fixed assets | (11,143 | ) | (111,568 | ) |
Purchase of tangible fixed assets | (81,221 | ) | (143,963 | ) |
Sale of tangible fixed assets | - | 853 |
Interest received | 3,618 | 2,830 |
Government grants | - | 833 |
Net cash from investing activities | (88,746 | ) | (251,015 | ) |
Cash flows from financing activities |
New loans in year | 10,016 | 118,374 |
Loan repayments in year | (460,897 | ) | (56,079 | ) |
Capital repayments in year | (24,113 | ) | (7,889 | ) |
Amount withdrawn by directors | - | 45,634 |
New hire purchase in year | - | 49,675 |
Net cash from financing activities | (474,994 | ) | 149,715 |
Increase/(decrease) in cash and cash equivalents | 125,286 | (731,579 | ) |
Cash and cash equivalents at beginning of year |
2 |
242,936 |
974,515 |
Cash and cash equivalents at end of year | 2 | 368,222 | 242,936 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT |
for the year ended 30 June 2023 |
1. | RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
£ | £ |
Loss before taxation | (801,896 | ) | (432,125 | ) |
Depreciation charges | 210,899 | 104,541 |
Fixed assets transferred to ownership | - | (270,758 | ) |
Merger accounting adjustment | - | (654,341 | ) |
Taxation | - | 4,882 |
Government grants | - | (833 | ) |
Finance costs | 113,015 | 25,057 |
Finance income | (3,618 | ) | (2,830 | ) |
(481,600 | ) | (1,226,407 | ) |
Increase in stocks | (193,170 | ) | (321,090 | ) |
Increase in trade and other debtors | (911,996 | ) | (1,274,304 | ) |
Increase in trade and other creditors | 2,373,976 | 2,212,533 |
Cash generated from operations | 787,210 | (609,268 | ) |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 30 June 2023 |
30/6/23 | 1/7/22 |
£ | £ |
Cash and cash equivalents | 368,222 | 242,936 |
Year ended 30 June 2022 |
30/6/22 | 1/7/21 |
£ | £ |
Cash and cash equivalents | 242,936 | 974,515 |
3. | ANALYSIS OF CHANGES IN NET DEBT |
At 1/7/22 | Cash flow | At 30/6/23 |
£ | £ | £ |
Net cash |
Cash at bank | 242,936 | 125,286 | 368,222 |
242,936 | 125,286 | 368,222 |
Debt |
Finance leases | (49,675 | ) | 24,113 | (25,562 | ) |
Debts falling due within 1 year | (2,528,308 | ) | 403,447 | (2,124,861 | ) |
Debts falling due after 1 year | (165,006 | ) | 47,434 | (117,572 | ) |
(2,742,989 | ) | 474,994 | (2,267,995 | ) |
Total | (2,500,053 | ) | 600,280 | (1,899,773 | ) |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
for the year ended 30 June 2023 |
1. | STATUTORY INFORMATION |
Commuto UK Ltd. is a group, registered in England and Wales. Its registered office address is Lyndale House, Ervington Court, Meridian Business Part, Leicester, United Kingdom, LE19 1WL and the registered number is 11703755. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements are prepared in sterling, which is the functional currency of the company, and rounded to the nearest £. |
Going concern |
The company has a loan in the form of a prebate based on expected sales targets made within their subsidiaries. In each period since the inception of the loans, the sales targets have been missed, thereby rendering the loan repayable on demand. The loan has therefore been moved in the financial statements as repayable within 1 year. The breach of the loan at the year end has not been remedied and the uncertainty of the loan being repayable on demand still remains. |
Since the year-end Sherwin Williams have confirmed their commitment to continue to supply paint products and support the group with future acquisitions on the basis that sales targets remain unchanged and they remain strategic partner for the group, whilst retaining their rights under the existing contract. |
The carrying value of the loan as at the reporting date was £1,997,995. |
The financial statements have been prepared on a going concern basis. This assumption is reliant upon the continued financial support from its ultimate parent company, Tingo Holdings Ltd & 530714BC Holdings Ltd. They have ensured that they will support Commuto UK Limited financial for a period of at least 1 year. |
Turnover |
Turnover represents amounts receivable for goods and services net of VAT and trade discounts and is recognised when goods are despatched. |
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. |
Goodwill |
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of the net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over it's expected life, which is 10 years. |
Intangible assets |
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Amortisation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following annual bases: |
Website - 20% straight line |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and impairment losses. |
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life. |
Leasehold Improvements | 10% and 20% straight line |
Plant & Machinery | 10%, 20%, 33% and 50% straight line |
Fixtures & Fittings | 10% and 20% straight line |
Computer Equipment | 20%, 25% and 33% straight line |
Motor Vehicles | 20% and 33% straight line |
The gain or loss that arises from the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset which then charged or credited to the profit or loss. |
Investments in subsidiaries |
Investment in the subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. All investments in subsidiaries are assessed for impairment at each reporting date and any impairment losses or reversals of impairments are recognised in the Statement of Income and Retained Earnings. |
A subsidiary is an entity which is controlled by the company. Control is the power to govern the financial and operating policies of the entity in order to gain benefits from the activities. |
Impairment of fixed assets |
At each reporting period end date, the company 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. |
Stocks |
Stocks are stated at the lower of cost and 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. |
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. |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
2. | ACCOUNTING POLICIES - continued |
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. |
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. |
Taxation |
The tax expense for the year comprises current and deferred tax. |
Tax is recognised in profit or loss except that a change attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively. |
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. |
Both current and deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Operating leases |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Leases that do not transfer all the risks and rewards of ownership are classified as operating leases. Payments under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Employee benefits |
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate. |
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. |
Retirement benefits |
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. |
Cash and cash equivalents |
Cash and cash equivalents are represented by cash in hand, deposits held at call with financial institutions, and other short-term highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value. |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
3. | TURNOVER |
The turnover and loss before taxation are attributable to the one principal activity of the group. |
An analysis of turnover by class of business is given below: |
2023 | 2022 |
£ | £ |
Repair of vehicles | 17,310,276 | 13,184,337 |
Software solutions | 74,396 | 195,272 |
17,384,672 | 13,379,609 |
An analysis of turnover by geographical market is given below: |
2023 | 2022 |
£ | £ |
United Kingdom | 17,384,672 | 13,379,609 |
17,384,672 | 13,379,609 |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries | 5,288,589 | 2,302,138 |
Social security | 520,643 | 203,625 |
Other pension costs | 120,063 | 53,887 |
5,928,295 | 2,559,650 |
The average number of employees during the year was as follows: |
2023 | 2022 |
Office staff | 79 | 69 |
Workshop staff | 82 | 60 |
Directors | 5 | 5 |
166 | 134 |
The average number of employees by undertaking that were proportionately consolidated during the year was 166 (2022 - 134). |
5. | OPERATING LOSS |
The operating loss is stated after charging: |
2023 | 2022 |
£ | £ |
Hire of plant and machinery | 70,642 | 10,599 |
Other operating leases | 529,205 | 228,081 |
Depreciation - owned assets | 177,300 | 71,753 |
Goodwill amortisation | 33,318 | 23,524 |
Computer software amortisation | 281 | 504 |
Auditors' remuneration | 42,000 | - |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Bank interest | 72,076 | 10,301 |
Other loan interest | 38,444 | 14,630 |
Interest payable | 2,495 | 126 |
113,015 | 25,057 |
7. | TAXATION |
Analysis of the tax credit |
The tax credit on the loss for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax | - | (13,073 | ) |
Tax on loss | - | (13,073 | ) |
8. | INDIVIDUAL INCOME STATEMENT |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
9. | INTANGIBLE FIXED ASSETS |
Group |
Computer |
Goodwill | software | Totals |
£ | £ | £ |
COST |
At 1 July 2022 | 392,219 | 13,680 | 405,899 |
Additions | 11,143 | - | 11,143 |
At 30 June 2023 | 403,362 | 13,680 | 417,042 |
AMORTISATION |
At 1 July 2022 | 130,854 | 13,345 | 144,199 |
Amortisation for year | 33,318 | 281 | 33,599 |
At 30 June 2023 | 164,172 | 13,626 | 177,798 |
NET BOOK VALUE |
At 30 June 2023 | 239,190 | 54 | 239,244 |
At 30 June 2022 | 261,365 | 335 | 261,700 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
9. | INTANGIBLE FIXED ASSETS - continued |
Company |
Goodwill |
£ |
COST |
At 1 July 2022 |
Additions |
At 30 June 2023 |
AMORTISATION |
At 1 July 2022 |
Amortisation for year |
At 30 June 2023 |
NET BOOK VALUE |
At 30 June 2023 |
At 30 June 2022 |
10. | TANGIBLE FIXED ASSETS |
Group |
Improvements | Fixtures |
to | Plant and | and |
property | machinery | fittings |
£ | £ | £ |
COST |
At 1 July 2022 | 200,798 | 740,540 | 41,301 |
Additions | - | 37,749 | 1,235 |
At 30 June 2023 | 200,798 | 778,289 | 42,536 |
DEPRECIATION |
At 1 July 2022 | 30,325 | 312,745 | 6,413 |
Charge for year | 23,363 | 110,102 | 4,355 |
At 30 June 2023 | 53,688 | 422,847 | 10,768 |
NET BOOK VALUE |
At 30 June 2023 | 147,110 | 355,442 | 31,768 |
At 30 June 2022 | 170,473 | 427,795 | 34,888 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
10. | TANGIBLE FIXED ASSETS - continued |
Group |
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 July 2022 | 59,598 | 103,758 | 1,145,995 |
Additions | - | 42,237 | 81,221 |
At 30 June 2023 | 59,598 | 145,995 | 1,227,216 |
DEPRECIATION |
At 1 July 2022 | 33,395 | 43,309 | 426,187 |
Charge for year | 3,163 | 36,317 | 177,300 |
At 30 June 2023 | 36,558 | 79,626 | 603,487 |
NET BOOK VALUE |
At 30 June 2023 | 23,040 | 66,369 | 623,729 |
At 30 June 2022 | 26,203 | 60,449 | 719,808 |
Company |
Computer |
equipment |
£ |
COST |
At 1 July 2022 |
Additions |
At 30 June 2023 |
DEPRECIATION |
At 1 July 2022 |
Charge for year |
At 30 June 2023 |
NET BOOK VALUE |
At 30 June 2023 |
At 30 June 2022 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
11. | FIXED ASSET INVESTMENTS |
Company |
Shares in |
group |
undertakings |
£ |
COST |
At 1 July 2022 |
Disposals | ( |
) |
At 30 June 2023 |
NET BOOK VALUE |
At 30 June 2023 |
At 30 June 2022 |
The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
Subsidiaries |
Registered office: Lyndale House Ervington Court, Meridian Business Park, Leicester, England, LE19 1WL |
Nature of business: |
% |
Class of shares: | holding |
Registered office: Lyndale House Ervington Court, Meridian Business Park, Leicester, England, LE19 1WL |
Nature of business: |
% |
Class of shares: | holding |
Registered office: Lyndale House Ervington Court, Meridian Business Park, Leicester, England, LE19 1WL |
Nature of business: |
% |
Class of shares: | holding |
12. | STOCKS |
Group |
2023 | 2022 |
£ | £ |
Stocks | 220,408 | 194,388 |
Work-in-progress | 538,566 | 371,416 |
758,974 | 565,804 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Trade debtors | 2,367,375 | 1,491,704 |
Amounts owed by group undertakings | - | - |
Amounts owed by associated companies | 252 | - |
Other debtors | 69,112 | 53,226 |
Directors' current accounts | 100 | 100 | - | - |
Tax | 12,789 | 27,620 |
Prepayments and accrued income | 202,775 | 182,336 |
2,652,403 | 1,754,986 |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Bank loans and overdrafts (see note 16) | 2,124,861 | 2,528,308 |
Finance leases (see note 17) | 17,354 | 6,010 |
Trade creditors | 503,868 | 409,592 |
Amounts owed to group undertakings | - | - |
Amounts owed to associated companies | 3,685,391 | 1,733,675 | 784,502 | 709,686 |
Social security and other taxes | 146,806 | 138,131 |
VAT | 350,085 | 178,797 | 4,305 | 4,729 |
Other creditors | 41,329 | 28,465 |
Accruals and deferred income | 486,758 | 351,349 |
7,356,452 | 5,374,327 |
15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group |
2023 | 2022 |
£ | £ |
Bank loans (see note 16) | 117,572 | 165,006 |
Finance leases (see note 17) | 8,208 | 43,665 |
125,780 | 208,671 |
16. | LOANS |
An analysis of the maturity of loans is given below: |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Amounts falling due within one year or on | demand: |
Bank loans | 60,641 | 50,795 |
Loans payable | 2,064,220 | 2,477,513 | 2,064,220 | 2,477,513 |
2,124,861 | 2,528,308 |
Amounts falling due between one and two | years: |
Bank loans - 1-2 years | 117,572 | 165,006 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
16. | LOANS - continued |
The company has a loan in the form of a prebate based on expected sales targets made within their subsidiaries. In each period since the inception of the loans, the sales targets have been missed, thereby rendering the loan repayable on demand. The loan has therefore been moved in the financial statements as repayable within 1 year. The breach of the loan at the year end has not been remedied and the uncertainty of the loan being repayable on demand still remains. |
Since the year-end Sherwin Williams have confirmed their commitment to continue to supply paint products and support the group with future acquisitions on the basis that sales targets remain unchanged and they remain strategic partner for the group, whilst retaining their rights under the existing contract. |
The carrying value of the loan as at the reporting date was £1,997,995. |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Finance leases |
2023 | 2022 |
£ | £ |
Net obligations repayable: |
Within one year | 17,354 | 6,010 |
Between one and five years | 8,208 | 43,665 |
25,562 | 49,675 |
Group |
Non-cancellable operating | leases |
2023 | 2022 |
£ | £ |
Within one year | 1,001,319 | 279,000 |
Between one and five years | 2,511,805 | 1,034,143 |
In more than five years | 2,282,708 | 1,299,250 |
5,795,832 | 2,612,393 |
18. | PROVISIONS FOR LIABILITIES |
Group |
2023 | 2022 |
£ | £ |
Deferred tax | 7,098 | 7,098 |
Group |
Deferred |
tax |
£ |
Balance at 1 July 2022 | 7,098 |
Balance at 30 June 2023 | 7,098 |
COMMUTO UK LTD. (REGISTERED NUMBER: 11703755) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 30 June 2023 |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | as restated |
£ | £ |
Ordinary A | 1 | 100 | 100 |
Ordinary B | 1 | 30 | 30 |
Ordinary C | 1 | 100 | 100 |
230 | 230 |
20. | RESERVES |
Group |
Retained |
earnings |
£ |
At 1 July 2022 | (1,982,638 | ) |
Deficit for the year | (770,240 | ) |
At 30 June 2023 | (2,752,878 | ) |
Company |
Retained |
earnings |
£ |
At 1 July 2022 |
Prior year adjustment | ( |
) |
Deficit for the year | ( |
) |
At 30 June 2023 |
21. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to a director subsisted during the years ended 30 June 2023 and 30 June 2022: |
2023 | 2022 |
as restated |
£ | £ |
I J Pugh |
Balance outstanding at start of year | 100 | 100 |
Amounts repaid | - | - |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year | 100 | 100 |
22. | POST BALANCE SHEET EVENTS |
On the 31st July 2023 Commuto UK purchased 90% of the shares in K & R Vehicle Solutions. |