REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
FOR |
CURROCK ENGINEERING COMPANY LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
FOR |
CURROCK ENGINEERING COMPANY LIMITED |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 3 |
Report of the Independent Auditors | 5 |
Income Statement | 9 |
Other Comprehensive Income | 10 |
Balance Sheet | 11 |
Statement of Changes in Equity | 12 |
Cash Flow Statement | 13 |
Notes to the Cash Flow Statement | 14 |
Notes to the Financial Statements | 15 |
CURROCK ENGINEERING COMPANY LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
Directors: |
Secretary: |
Registered office: |
Registered number: |
Auditors: |
Statutory Auditor |
Chartered Certified Accountants |
Dickens House |
Guithavon Street |
Witham |
Essex |
CM8 1BJ |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
The directors present their strategic report for the year ended 31 October 2023. |
Review of business |
The principal activities of the company continued during the year as precision engineers. |
The key financial and other performance indicators during the year were as follows: |
2023 | 2022 | Change |
Turnover | 5,777,433 | 7,593,393 | -23.92% |
Gross profit | -4,500,917 | 1,990,012 | -326.18% |
Profit after tax | -7,288,802 | 767,574 | -1,049,59% |
Equity shareholders' funds | 880,562 | 8,224,665 | -89.29% |
Stock and work in progress | 4,009,423 | 7,150,615 | -43.93% |
Gross profit percentage | -77.91% | 26.21% | -397.25% |
Current ratio | 84% | 208% | -59.62% |
Average number of employees | 81 | 85 | -4.71% |
Production and sales have been negatively affected by encountering technical issues with a variety of product developments and qualification programmes. |
The impact of Covid which resulted in delayed orders continued throughout the year. |
The Bank of England base rate rose by 3% during the year (2.25% to 5.25%). This increase has resulted in significantly higher finance charges through the year. |
The company is dependent on defence spending. Defence spending depends on a complex mix of political considerations and budgetary constraints. The recent conflicts in Ukraine and Gaza, in addition to other areas of heightened global tension has resulted in proposed increases in countries defence spending as a percentage of GDP. |
Principal risks and uncertainties |
The order book stood at £14 million at the financial year end. Order intake during the review period was £9.7 million. |
Key issues remain converting the order book into sales, given the technical issues with some of the products which has had a significant impact on turnover and cash balances. |
The company continues to participate in Defence component manufacturing activities through tier one defence contractors. |
Key performance indicators |
Currock achieved re-accreditation to the EN9100 Quality Standard in 2023. |
During the review period, On Time Delivery '(OTD') was affected by product technical issues. Improvement is targeted for the next financial year, however initial reduced production output has continued to impact this. |
On behalf of the board: |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
The directors present their report with the financial statements of the company for the year ended 31 October 2023. |
Dividends |
The total distribution of dividends for the year ended 31 October 2023 will be £ |
Future developments |
The directors are aware, as at the date of this report, of an impending change in ownership of the company. MBDA are anticipated to acquire the entire shareholding of the company in August 2024. |
Directors |
The directors shown below have held office during the whole of the period from 1 November 2022 to the date of this report. |
Other changes in directors holding office are as follows: |
Statement of directors' responsibilities |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
Statement as to disclosure of information to auditors |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
Auditors |
The auditors, Baverstocks Limited, 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 |
CURROCK ENGINEERING COMPANY LIMITED |
Opinion |
We have audited the financial statements of Currock Engineering Company Limited (the 'company') for the year ended 31 October 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the 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 company's affairs as at 31 October 2023 and of its 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 conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Material uncertainty related to going concern |
We draw your attention to Note 2 which indicates that the effects of a tough and challenging year which has resulted in a loss after tax of £7,288,802 due to the write off of stock and work in progress, production and sales which have been negatively affected by encountering technical issues with a variety of product developments and qualification programmes. This together with the continuing impact of Covid which has resulted in delayed orders has resulted in the company making significant losses during the year. |
These issues have had an adverse effect on the company’s operations and cash flow. As stated in Note 2, these events or conditions, along with other matters as set forth in Note 2 indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern. |
Our opinion is not modified in respect of this matter. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
CURROCK ENGINEERING COMPANY LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page 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 company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
CURROCK ENGINEERING COMPANY LIMITED |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Our approach to assessing the risks of material misstatement due to fraud and noncompliance with laws and regulations was as follows:- |
We obtained an understanding of the legal and regulatory frameworks that are applicable to the entity and determined that the most significant are those that relate to compliance with the Companies Act 2006, Financial Reporting Standard 102, relevant tax legislation and the British Standards Institute (BSI). |
We assessed the risks of material misstatements in respect of fraud and determined that the principal risks were related to posting of journal entries to manipulate the results for the financial year. We made enquiries of management during the audit to determine any instances of fraud, while also discussing the areas of risk in relation to audit as part of our audit team meeting. |
Based upon the results of our risk assessment we designed our audit procedures to identify noncompliance with such laws and regulations identified above and also material misstatements in respect of fraud as follows:- |
- | We obtained an understanding of the legal and regulatory framework in relation to the entity and how it complies with this framework. This included discussions with management, reviews of legal and professional fees and a review of the results of audits conducted by BSI. |
- |
We discussed with the management the entity's policies and procedures including systems and controls. Compliance with these was tested via discussion and walkthrough testing of controls. |
- |
We enquired of management of their policies and procedures in relation to fraud and their knowledge of any actual, suspected, or alleged fraud. |
- |
We ensured compliance with Pay as You Earn and Value Added Tax laws via reviewing returns and correspondence. |
- | We reviewed the recent results of audits with BSI to ensure ongoing compliance. |
- |
We considered the risk of fraud through management override, and, in response, we incorporated testing of manual journal entries into our audit approach. This included the testing of journal entries throughout the year as well as year end journals. |
- | We agreed the financial statement disclosures to underlying supporting documentation. |
- | We enquired of management if there were any potential litigation or claims. |
Whilst considering how our audit work addressed the detection of irregularities, we also consider the likelihood of detection based on our approach. Irregularities from fraud are inherently more difficult to detect than those arising from error. |
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. |
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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
CURROCK ENGINEERING COMPANY LIMITED |
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 |
Statutory Auditor |
Chartered Certified Accountants |
Dickens House |
Guithavon Street |
Witham |
Essex |
CM8 1BJ |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
Turnover | 3 |
Cost of sales |
Gross (loss)/profit | ( |
) |
Distribution costs |
Administrative expenses |
3,060,972 | 1,623,583 |
Operating (loss)/profit | 5 | ( |
) |
Interest receivable and similar income |
(7,561,867 | ) | 366,438 |
Interest payable and similar expenses | 6 |
(Loss)/profit before taxation | ( |
) |
Tax on (loss)/profit | 7 | ( |
) | ( |
) |
(Loss)/profit for the financial year | ( |
) |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
2023 | 2022 |
Notes | £ | £ |
(Loss)/profit for the year | ( |
) |
Other comprehensive income | - | - |
Total comprehensive income for the year |
( |
) |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
BALANCE SHEET |
31 OCTOBER 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
Fixed assets |
Intangible assets | 9 |
Tangible assets | 10 |
Current assets |
Stocks | 11 |
Debtors | 12 |
Cash at bank |
Creditors |
Amounts falling due within one year | 13 |
Net current (liabilities)/assets | ( |
) |
Total assets less current liabilities |
Creditors |
Amounts falling due after more than one year |
14 |
( |
) |
( |
) |
Provisions for liabilities | 18 | ( |
) |
Net assets |
Capital and reserves |
Called up share capital | 19 |
Retained earnings | 20 |
Shareholders' funds |
The financial statements were approved by the Board of Directors and authorised for issue on |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 November 2021 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 October 2022 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 31 October 2023 |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | ( |
) |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
( |
) |
Taxation refund |
Net cash from operating activities | ( |
) |
Cash flows from investing activities |
Purchase of intangible fixed assets | ( |
) |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
New loans in year |
Loan repayments in year | ( |
) | ( |
) |
Invoice discounting advance | (144,643 | ) | 445,696 |
Trade finance facility | 195,701 | 155,015 |
Capital repayments in year | ( |
) | ( |
) |
Amount introduced by directors | - | 124,000 |
Amount withdrawn by directors | (96,838 | ) | (159,945 | ) |
Equity dividends paid | ( |
) | ( |
) |
Net cash from financing activities | ( |
) |
Decrease in cash and cash equivalents | ( |
) | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
142,969 |
Cash and cash equivalents at end of year |
2 |
6,858 |
82,437 |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
1. | Reconciliation of (loss)/profit before taxation to cash generated from operations |
2023 | 2022 |
£ | £ |
(Loss)/profit before taxation | ( |
) |
Depreciation charges |
Loss on disposal of fixed assets |
Finance costs | 379,557 | 124,754 |
Finance income | (22 | ) | (9 | ) |
(6,106,646 | ) | 1,247,316 |
Decrease/(increase) in stocks | ( |
) |
Decrease/(increase) in trade and other debtors | ( |
) |
Increase in trade and other creditors |
Cash generated from operations | ( |
) |
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 31 October 2023 |
31.10.23 | 1.11.22 |
£ | £ |
Cash and cash equivalents | 6,858 | 82,437 |
Year ended 31 October 2022 |
31.10.22 | 1.11.21 |
£ | £ |
Cash and cash equivalents | 82,437 | 142,969 |
3. | Analysis of changes in net debt |
At 1.11.22 | Cash flow | At 31.10.23 |
£ | £ | £ |
Net cash |
Cash at bank | 82,437 | (75,579 | ) | 6,858 |
82,437 | ( |
) | 6,858 |
Debt |
Finance leases | (2,479,708 | ) | 250,042 | (2,229,666 | ) |
Debts falling due within 1 year | (2,512,460 | ) | (361,666 | ) | (2,874,126 | ) |
Debts falling due after 1 year | (435,688 | ) | (16,908 | ) | (452,596 | ) |
(5,427,856 | ) | (128,532 | ) | (5,556,388 | ) |
Total | (5,345,419 | ) | (204,111 | ) | (5,549,530 | ) |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
1. | Statutory information |
Currock Engineering Company Limited is a |
2. | Accounting policies |
Basis of preparing the financial statements |
Critical accounting judgements and key sources of estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
There are no estimates and assumptions that have a significant risk of causing material adjustment in the financial statements. |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Tangible fixed assets |
Short Leasehold | - |
Plant and Machinery | - |
Fixtures and Fittings | - |
Motor Vehicles | - |
Office Equipment | - |
Stocks |
Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
2. | Accounting policies - continued |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of the future payments is treated as a liability. |
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Invoice discounting |
Trade receivables are subject to an invoice discounting facility whereby an advance is received based upon and secured upon trade debtors. |
Where the Company has retained significant risks and rewards relating to the discounted debts, separate presentation is adopted whereby the gross debts and a corresponding liability in respect of the advance received is shown separately on the balance sheet within creditors. The interest element of the invoice discounter's charge is recognised as it accrues and included in the profit and loss account within finance costs. |
Impairment |
Assets not measured at fair value are reviewed for any indication that the asset may be impaired at each balance sheet date. If such indication exists, the recoverable amount of the asset, or the asset's cash generating unit, is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognised in profit or loss unless the asset is carried at a revalued amount where the impairment loss is a revaluation decrease. |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
2. | Accounting policies - continued |
Going concern |
The company has experienced a tough and challenging year which has resulted in a loss after tax of £7,288,802 due to a number of factors as follows:- |
The write off of overstated stock and work in progress. |
Production and sales which have been negatively affected by encountering technical issues with a variety of product developments and qualification programmes. |
The continuing impact of Covid which has resulted in delayed orders has resulted in the company making significant losses during the year. |
As a result of the issues during the year, the company has had significant cashflow issues which have continued since the year end. This has meant that the management have sought support for the day-to-day working capital requirements of the company and have resulted in borrowings from MBDA to assist with the cashflow management. MBDA are one of the company's largest customers and rely on the manufacturing activities of the company within a specialised area. The company's forecasts and projections up to 31 January 2025 show a significant amount of further borrowing is required from MBDA. |
As a result of these matters there is a material uncertainty that may cast significant doubt upon the company's ability to continue as a going concern and therefore whether the company will realise its assets and settle its liabilities in the ordinary course of business at the amounts recorded in the financial statements. |
In response to these matters, the entity has taken the action to approach MBDA to agree a sale of the issued share capital of the company via an option agreement. At present, MBDA have not exercised the option, however management have been given assurances by MBDA that they will exercise the option and purchase the company and provide continued funding to ensure the future existence of the company. |
Although it is not certain that the option will be exercised and the future funding provided by MBDA which, management has determined that the actions it has taken are sufficient to mitigate the uncertainty and has therefore prepared the financial statements on the assumption the entity is a going concern is contingent on the continued support of MBDA. |
3. | Turnover |
The turnover and loss (2022 - profit) before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by class of business is given below: |
2023 | 2022 |
£ | £ |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
4. | Employees and directors |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Cost of Sales | 76 | 81 |
Administration and Management | 5 | 4 |
2023 | 2022 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Information regarding the highest paid director for the year ended 31 October 2023 is as follows: |
2023 |
£ |
Emoluments etc |
5. | Operating (loss)/profit |
The operating loss (2022 - operating profit) is stated after charging: |
2023 | 2022 |
£ | £ |
Depreciation - owned assets |
Depreciation - assets on hire purchase contracts |
Loss on disposal of fixed assets |
Computer software amortisation |
Auditors Remuneration |
6. | Interest payable and similar expenses |
2023 | 2022 |
£ | £ |
Loan Interest |
Other Interest |
Hire Purchase Interest |
HMRC Interest |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
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 | ( |
) |
Deferred Taxation | ( |
) |
Tax on (loss)/profit | ( |
) | ( |
) |
Reconciliation of total tax credit included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
(Loss)/profit before tax | ( |
) |
(Loss)/profit multiplied by the standard rate of corporation tax in the UK of |
( |
) |
Effects of: |
Expenses not deductible for tax purposes |
Utilisation of tax losses |
Research and development enhanced expenditure claim | - | (590,347 | ) |
Total tax credit | (652,622 | ) | (525,890 | ) |
8. | Dividends |
2023 | 2022 |
£ | £ |
Ordinary A shares of £1 each |
Interim |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
9. | Intangible fixed assets |
Computer |
software |
£ |
Cost |
At 1 November 2022 |
Disposals | ( |
) |
At 31 October 2023 |
Amortisation |
At 1 November 2022 |
Eliminated on disposal | ( |
) |
At 31 October 2023 |
Net book value |
At 31 October 2023 |
At 31 October 2022 |
10. | Tangible fixed assets |
Fixtures |
Short | Plant and | and |
Leasehold | Machinery | Fittings |
£ | £ | £ |
Cost |
At 1 November 2022 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 October 2023 |
Depreciation |
At 1 November 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 October 2023 |
Net book value |
At 31 October 2023 |
At 31 October 2022 |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
10. | Tangible fixed assets - continued |
Motor | Office |
Vehicles | Equipment | Totals |
£ | £ | £ |
Cost |
At 1 November 2022 |
Additions |
Disposals | ( |
) | ( |
) | ( |
) |
At 31 October 2023 |
Depreciation |
At 1 November 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) | ( |
) |
At 31 October 2023 |
Net book value |
At 31 October 2023 |
At 31 October 2022 |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Plant and | Motor |
Machinery | Vehicles | Totals |
£ | £ | £ |
Cost |
At 1 November 2022 |
Transfer to ownership | - | (122,480 | ) | (122,480 | ) |
At 31 October 2023 |
Depreciation |
At 1 November 2022 |
Charge for year |
Transfer to ownership | - | (77,981 | ) | (77,981 | ) |
At 31 October 2023 |
Net book value |
At 31 October 2023 |
At 31 October 2022 |
11. | Stocks |
2023 | 2022 |
£ | £ |
Stocks |
Work in Progress |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
12. | Debtors: amounts falling due within one year |
2023 | 2022 |
£ | £ |
Trade Debtors |
Directors Current Accounts | 231,505 | 134,667 |
Tax |
Prepayments and Accrued Income |
13. | Creditors: amounts falling due within one year |
2023 | 2022 |
£ | £ |
Other loans (see note 15) | 2,874,126 | 2,512,460 |
Hire purchase contracts (see note 16) |
Trade Creditors |
Social Security and Other |
Taxes |
Other Creditors |
Accruals and Deferred Income |
14. | Creditors: amounts falling due after more than one year |
2023 | 2022 |
£ | £ |
Other loans (see note 15) | 452,596 | 435,688 |
Hire purchase contracts (see note 16) |
15. | Loans |
An analysis of the maturity of loans is given below: |
2023 | 2022 |
£ | £ |
Amounts falling due within one year or on demand: |
Other Loans | 459,398 | 148,790 |
Invoice Discounting Advance | 1,543,324 | 1,687,967 |
Trade Finance Facility | 871,404 | 675,703 |
Amounts falling due between one and two years: |
Other Loans - 1-2 years | 174,024 |
Amounts falling due between two and five years: |
Other Loans | 278,572 | 278,730 |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
16. | Leasing agreements |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
2023 | 2022 |
£ | £ |
Gross obligations repayable: |
Within one year |
Between one and five years |
Finance charges repayable: |
Within one year |
Between one and five years |
Net obligations repayable: |
Within one year |
Between one and five years |
Non-cancellable | operating leases |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
17. | Secured debts |
The following secured debts are included within creditors: |
2023 | 2022 |
£ | £ |
Hire purchase contracts | 2,229,666 | 2,479,708 |
Invoice discounting advance | 1,543,324 | 1,687,967 |
The amount due to Bibby Invoice Discounting Ltd is in respect of sales invoice discounting and is secured by way of a fixed and floating charge over the assets of the Company. |
The hire purchase debt is secured against the specific fixed asset(s) financed. |
18. | Provisions for liabilities |
2023 | 2022 |
£ | £ |
Deferred Taxation | - | 652,622 |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
18. | Provisions for liabilities - continued |
Deferred |
tax |
£ |
Balance at 1 November 2022 |
Credit to Income Statement during year | ( |
) |
Balance at 31 October 2023 |
19. | Called up share capital |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary A | £1 | 166 | 166 |
Ordinary B | £1 | 34 | 34 |
Ordinary C | £1 | 300,000 | 300,000 |
300,200 | 300,200 |
20. | Reserves |
Retained |
earnings |
£ |
At 1 November 2022 |
Deficit for the year | ( |
) |
Dividends | ( |
) |
At 31 October 2023 |
21. | Directors' advances, credits and guarantees |
The following advances and credits to a director subsisted during the years ended 31 October 2023 and 31 October 2022: |
2023 | 2022 |
£ | £ |
Balance outstanding at start of year |
Amounts advanced |
Amounts repaid | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year |
22. | Related party disclosures |
2023 | 2022 |
£ | £ |
Purchases |
Amount due to related party |
CURROCK ENGINEERING COMPANY LIMITED (REGISTERED NUMBER: 00828340) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 OCTOBER 2023 |
22. | Related party disclosures - continued |
During the year, a total of key management personnel compensation of £ |
23. | Ultimate controlling party |
The controlling party is A Murray. |