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09166246







LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED
31 DECEMBER 2023

































LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
COMPANY INFORMATION


Directors
S. Davidson 
B. M. Johnson 
M. J. Turner 




Company secretary
M. J. Phillips



Registered number
09166246



Registered office
59 Imperial Way

Croydon

England

CR0 4RR




Independent auditors
CLA Evelyn Partners Limited
Statutory Auditors

Brockbourne House

77 Mount Ephraim

Tunbridge Wells

Kent

TN4 8BS





LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

CONTENTS



Page
Group Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Consolidated Statement of Comprehensive Income
 
9
Consolidated Balance Sheet
 
10 - 11
Company Balance Sheet
 
12
Consolidated Statement of Changes in Equity
 
13
Company Statement of Changes in Equity
 
14
Consolidated Statement of Cash Flows
 
15 - 16
Consolidated Analysis of Net Debt
 
17
Notes to the Financial Statements
 
18 - 38


LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their strategic report of the company and the group for the year ended 31 December 2023.

Business review
 
Growth has remained steady throughout 2023 resulting in highest ever turnover. Confidence has returned and there has been signs of many big projects being undertaken by both the Private & Public sector. 
Turnover increased to £15.23m (2022: £13.42m) with operating margins of 14.90% (2022: 6.37%). These margins have alleviated as we have seen material costs stabilize somewhat. 
2024 has continued strongly with good margins but recent worries over the cost of living crisis will no doubt have some effect on our market. 
Our industry remains robust but we still face many challenges in the months to come, with ever increasing overseas competition for Lester Controls.

Principal risks and uncertainties
 
In managing the group the directors monitor the results against the budget and the previous year through monthly management reports and snapshots of the trading result following each period end. Risk management is an important issue to the group. The key risks to the business include:
Laws and regulation
We saw signs of the effects of new legislation relating to lift safety slowly impacting on our support levels internally and externally. Lift specifications are dictating a higher level of Controller features which will impact on turnover in the future, but a greater understanding all round is affecting build and test times. This again is affecting our day to day operations as we are starting to see more of a support role as the Industry "expertise" is diminishing.
Economic uncertainties
We operate across a number of market sectors in the UK and are affected by national macro-economic conditions including the effects of Brexit as well as by the investment and spending cycles that exist in many industries. Our spread across differing market sectors helps us to mitigate our exposure to short and medium term economic uncertainties.

Financial key performance indicators
 
The group regularly reviews a number of financial and non-financial key performance indicators at both board and operational levels. The group carries out monthly detailed reviews of each operational and support function at which all aspects of each business and key performance indicators are reviewed.
                                     
2023                2022
Turnover (£'000's)                                  £15,232             £13,424
Gross profit percentage                                   32.97%            26.11% 
Average number of employees                      113     100
Average turnover per employee (£'000's)             135    134

Page 1

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Other key performance indicators
 
The group reviews non-financial KPIs on a regular basis in a number of areas: 
Health and safety - the group aims to achieve below the year-on-year improvement in accident incidence rate and remain Health and Safety Executive benchmark for the UK. We have achieved a significant improvement in the year.
Customer experience - the group aspires to deliver a high level of customer satisfaction which supporting sustainable long-term growth in the sector. is key to most of our customers Feedback received during the year demonstrated that are fully or mostly satisfied with our services. 
Employee welfare - the group strives to attract and retain employee turnover highly motivated, high-performing teams. The group's is low.


This report was approved by the board on 24 July 2024 and signed on its behalf.



S. Davidson
Director

Page 2

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023.

Directors' responsibilities statement

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

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

Results and dividends

The profit for the year, after taxation and minority interests, amounted to £1,877,216 (2022 - £718,329).

The dividends for the year amount to £376,000 (2022 - £180,000).

Directors

The directors who served during the year were:

S. Davidson 
B. M. Johnson 
M. J. Turner 

Future developments

Development is key and is constantly being worked on. Apart from the continual product enhancements and software improvements which are working hard on the next generation of Microprocessor. There is an emphasis on using Safety Critical Components for Lester Controls which for compliance will require extreme and rigorous testing. Our Group Destination Control for Lester Controls has now been launched and, to date, three sites have been successfully completed.  Sarum Electronics is developing new products for new markets which has involved development with the R&D team at Lester Controls.

Page 3

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Group since the year end.

Auditors

The auditorsCLA Evelyn Partners Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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





S. Davidson
Director

Date: 24 July 2024

Page 4

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

Opinion


We have audited the financial statements of Lester Control Systems (Holdings) Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 December 2023 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


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


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or 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.


Page 5

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED (CONTINUED)

Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Group 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 Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the 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 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 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 Directors' Responsibilities Statement set out on page 3, 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 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.


Page 6

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED (CONTINUED)

Auditors' responsibilities for the audit of the financial statements
 

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


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

We obtained a general understanding of the Group and the parent Company’s legal and regulatory framework through enquiry of management concerning their understanding of relevant laws and regulations, the entity’s policies and procedures regarding compliance, and how they identify, evaluate and account for litigation claims. We also drew on our existing understanding of the company’s industry and regulation. We obtained this understanding for significant components through discussion with group management. 
 
We understand that the Group and the parent Company complies with the framework through: 
Outsourcing accounting services, accounts preparation and tax compliance to external experts. 
Subscribing to relevant updates from external experts, and making changes to internal procedures and controls as necessary. 
 
In the context of the audit, we considered those laws and regulations which determine the form and content of the financial statements, which are central to the Group and the parent Company’s ability to conduct its business, and/or where there is a risk that failure to comply could result in material penalties. We identified the following laws and regulations as being of significance in the context of the Group and the parent Company: 
 
The Companies Act 2006 and FRS 102 in respect of the preparation and presentation of the financial statements.
UK taxation law.
 
The senior statutory auditor led a discussion with senior members of the engagement team regarding the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur. The areas identified in this discussion were: 
Revenue recognition, in particular cut-off and completeness, which is an inherent risk common to owner managed companies. 
Manipulation of the financial statements, especially transactions with directors and management override, via fraudulent journal entries, particularly as the size of the company means that there is little opportunity for segregation of duties. 
 
The procedures we carried out to gain evidence in the above areas included:
Challenging management regarding the nature and appropriateness of unexpected or unusual accounting adjustments. 
Substantive testing on material areas affecting timing of and completeness of revenue postings. 
Testing journal entries, focusing particularly on postings to unexpected or unusual accounts and those posted at unusual times. 
 


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


Page 7

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED (CONTINUED)

Use of our report
 

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





Matthew Neill BA (Hons) MA FCA (Senior Statutory Auditor)
  
for and on behalf of
CLA Evelyn Partners Limited
 
Statutory Auditors
  
Brockbourne House
77 Mount Ephraim
Tunbridge Wells
Kent
TN4 8BS

Date: 25 July 2024
Page 8

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
15,232,404
13,423,842

Cost of sales
  
(10,456,994)
(9,919,425)

Exceptional cost of sales
 14 
247,474
-

Gross profit
  
5,022,884
3,504,417

Administrative expenses
  
(2,900,704)
(2,561,524)

Exceptional administrative expenses
 14 
160,000
-

Other operating income
 5 
2,974
7,053

Fair value movements
  
977
(78,786)

Other operating charges
  
(15,944)
(16,053)

Operating profit
 6 
2,270,187
855,107

Income from fixed assets investments
  
7,155
9,239

Amounts written off investments
  
4,558
(51,043)

Interest receivable and similar income
 11 
87,453
11,965

Interest payable and similar expenses
  
(465)
-

Profit before taxation
  
2,368,888
825,268

Tax on profit
 13 
(467,466)
(74,700)

Profit for the financial year
  
1,901,422
750,568

  

Profit for the year attributable to:
  

Non-controlling interests
  
24,206
32,239

Owners of the parent Company
  
1,877,216
718,329

  
1,901,422
750,568

There were no recognised gains and losses for 2023 or 2022 other than those included in the consolidated statement of comprehensive income.

The notes on pages 18 to 38 form part of these financial statements.

Page 9

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
REGISTERED NUMBER:09166246

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 15 
51,771
111,764

Tangible assets
 16 
147,137
152,965

Investments
 17 
261,044
985,286

  
459,952
1,250,015

Current assets
  

Stocks
 18 
1,803,637
1,793,613

Debtors: amounts falling due within one year
 19 
2,469,017
2,379,653

Cash at bank and in hand
 20 
5,751,777
3,505,166

  
10,024,431
7,678,432

Creditors: amounts falling due within one year
 21 
(2,888,624)
(2,762,211)

Net current assets
  
 
 
7,135,807
 
 
4,916,221

Total assets less current liabilities
  
7,595,759
6,166,236

Provisions for liabilities
  

Deferred taxation
 22 
(4,685)
(28,286)

Other provisions
 23 
(234,534)
(312,037)

  
 
 
(239,219)
 
 
(340,323)

Net assets
  
7,356,540
5,825,913


Capital and reserves
  

Called up share capital 
 24 
4,967
4,967

Capital redemption reserve
 25 
5,033
5,033

Other reserves
 25 
74,798
57,093

Merger reserve
 25 
(1,350,000)
(1,350,000)

Profit and loss account
 25 
8,587,575
7,086,359

Equity attributable to owners of the parent Company
  
7,322,373
5,803,452

Non-controlling interests
  
34,167
22,461

  
7,356,540
5,825,913


Page 10

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
REGISTERED NUMBER:09166246
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023

The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




S. Davidson
Director

Date: 24 July 2024

The notes on pages 18 to 38 form part of these financial statements.

Page 11

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
REGISTERED NUMBER:09166246

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Investments
 17 
2,468,111
2,468,111

  
2,468,111
2,468,111

Current assets
  

Debtors: amounts falling due within one year
 19 
2,075
-

Cash at bank and in hand
 20 
220,034
410,175

  
222,109
410,175

Creditors: amounts falling due within one year
 21 
(130)
(88,057)

Net current assets
  
 
 
221,979
 
 
322,118

Total assets less current liabilities
  
2,690,090
2,790,229

  

  

Net assets
  
2,690,090
2,790,229


Capital and reserves
  

Called up share capital 
 24 
4,967
4,967

Capital redemption reserve
 25 
5,033
5,033

Other reserves
 25 
74,798
57,093

Profit and loss account
 25 
2,605,292
2,723,136

  
2,690,090
2,790,229


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


S. Davidson
Director

Date: 24 July 2024

The notes on pages 18 to 38 form part of these financial statements.

Page 12


LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
  

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023



Called up share capital
Capital redemption reserve
Other reserves
Merger reserve
Profit and loss account
Equity attributable to owners of parent Company
Non
Controlling
Interests
Total equity


£
£
£
£
£
£
£
£



At 1 January 2022
4,967
5,033
39,388
(1,350,000)
6,548,030
5,247,418
-
5,247,418





Profit for the year
-
-
-
-
718,329
718,329
32,239
750,568


Shares issued
-
-
-
-
-
-
222
222


Dividends: Equity capital
-
-
-
-
(180,000)
(180,000)
(10,000)
(190,000)


Share based payments
-
-
17,705
-
-
17,705
-
17,705





At 1 January 2023
4,967
5,033
57,093
(1,350,000)
7,086,359
5,803,452
22,461
5,825,913



Comprehensive income for the year


Profit for the year
-
-
-
-
1,877,216
1,877,216
24,206
1,901,422


Dividends: Equity capital
-
-
-
-
(376,000)
(376,000)
(12,500)
(388,500)


Share based payments
-
-
17,705
-
-
17,705
-
17,705



At 31 December 2023
4,967
5,033
74,798
(1,350,000)
8,587,575
7,322,373
34,167
7,356,540



The notes on pages 18 to 38 form part of these financial statements.

   Page 13 

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Capital redemption reserve
Other reserves
Profit and loss account
Total equity

£
£
£
£
£


At 1 January 2022
4,967
5,033
39,388
2,830,841
2,880,229



Profit for the year
-
-
-
72,295
72,295

Dividends
-
-
-
(180,000)
(180,000)

Shared based payments
-
-
17,705
-
17,705



At 1 January 2023
4,967
5,033
57,093
2,723,136
2,790,229



Profit for the year
-
-
-
258,156
258,156

Dividends
-
-
-
(376,000)
(376,000)

Share based payments
-
-
17,705
-
17,705


At 31 December 2023
4,967
5,033
74,798
2,605,292
2,690,090


The notes on pages 18 to 38 form part of these financial statements.

Page 14

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
1,901,422
750,568

Adjustments for:

Amortisation of intangible assets
65,025
55,534

Depreciation of tangible assets
65,537
77,434

Loss on disposal of tangible assets
9,871
6,177

Government grants
-
(7,053)

Interest received
(94,608)
(21,204)

Taxation charge
467,466
74,700

(Increase) in stocks
(10,024)
(469,784)

(Increase) in debtors
(149,259)
(787,955)

Increase in creditors
76,381
347,606

(Decrease)/increase in provisions
(77,503)
38,400

Net fair value (gains)/losses recognised in P&L
(977)
78,786

Corporation tax (paid)
(77,952)
(56,690)

EMI shares granted
17,705
17,705

Net cash generated from operating activities

2,193,084
104,224


Cash flows from investing activities

Purchase of intangible fixed assets
(18,270)
-

Purchase of tangible fixed assets
(66,018)
(76,394)

Sale of tangible fixed assets
5,118
9,500

Sale of listed investments
-
(1,043)

Purchase of unlisted and other investments
(379,287)
(36,621)

Sale of unlisted and other investments
1,109,064
58,743

Government grants received
-
7,053

Interest received
87,453
11,965

Dividends received
7,155
9,239

Net cash from investing activities

745,215
(17,558)
Page 15

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


2023
2022

£
£



Cash flows from financing activities

Loans due from/(repaid to) directors
(278,917)
-

Dividends paid
(376,000)
(180,000)

Dividends paid to non-controlling interests
(12,500)
(10,000)

Shares issued to non-controlling interests
-
222

Net cash used in financing activities
(667,417)
(189,778)

Net increase/(decrease) in cash and cash equivalents
2,270,882
(103,112)

Cash and cash equivalents at beginning of year
3,480,895
3,584,007

Cash and cash equivalents at the end of year
5,751,777
3,480,895


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
5,751,777
3,505,166

Bank overdrafts
-
(24,271)

5,751,777
3,480,895


The notes on pages 18 to 38 form part of these financial statements.

Page 16

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023




At 1 January 2023
Cash flows
At 31 December 2023
£

£

£

Cash at bank and in hand

3,505,166

2,246,611

5,751,777

Bank overdrafts

(24,271)

24,271

-






3,480,895
2,270,882
5,751,777

The notes on pages 18 to 38 form part of these financial statements.

Page 17

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Lester Control Systems (Holdings) Limited is a private company, limited by shares, registered in England and Wales. The company's registered number is 09166246. The registered office is 59 Imperial Way, Croydon, England, CR0 4RR. 
The principal activity of the Group is the manufacture and supply of lift control equipment and building control panels for heating, ventilation and air-conditioning. 
The presentational currency of the financial statements is the Pound Sterling (£), rounded to the nearest £1. 

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
Monetary amounts in these financial statements are stated in pounds sterling and are rounded to the nearest whole £1, except where otherwise stated.

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

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 01 January 2014.

Therefore, the Group continues to recognise a merger reserve which arose on a past business combination that was accounted for as a merger in accordance with UK GAAP as applied at that time.

Page 18

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

Page 19

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from the sale of goods is therefore recognised once the goods have been despatched.

Revenue received in respect of deposits are fully refundable until the goods have entered the design and build phase. Where an order is cancelled part way through, the amount of unfinished work in progress is deemed refundable on the deposit.

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

Revenue from the provision of services is therefore recognised once the service has been carried out.

 
2.5

Operating leases: the Group as lessee

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

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

 
2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated Statement of Comprehensive Income in the same period as the related expenditure.

Page 20

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.8

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.9

 Pensions

Defined contribution pension plan

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

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

 
2.10

 Share-based payments

Where share options are awarded to employees, the fair value of the options at the date of grant is charged to profit or loss over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Group keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period.
Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.

Page 21

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.11

 Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge 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.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.12

 Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Group but are presented separately due to their size or incidence.

 
2.13

 Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life of 10 years.

Other 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.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 The estimated useful lives range as follows:

Software
-
4
years

Page 22

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.14

 Tangible fixed assets

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

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.

Depreciation is provided on the following basis:

Plant and machinery
-
25%
on reducing balance
Motor vehicles
-
25%
on reducing balance
Fixtures and fittings
-
25%
on reducing balances
Office equipment
-
25%
on reducing balance
Computer equipment
-
25%
on reducing balances

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

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

 
2.15

 Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment. Where Merger Relief is available, the cost of the  investment is accounted for at the nominal value of the related equity instrument.

Investments in unlisted company shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in profit or loss for the period.

 
2.16

 Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.17

 Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Page 23

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.18

 Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are 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.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.19

 Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.20

 Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.21

 Financial instruments

The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares. 
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan. 
 
Investments in non-derivative instruments that are equity to the issuer are measured:
 
at fair value with changes recognised in the Consolidated statement of comprehensive income if the shares are publicly traded or their fair value can otherwise be measured reliably; 
at cost less impairment for all other investments.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated statement of comprehensive income. 
 
Page 24

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.21
 Financial instruments (continued)

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. 
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were to be sold at the balance sheet date. 
Financial assets and liabilities are offset and the net amount reported in the consolidated balance sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

 
2.22

 Dividends

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


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In the application of the Group's accounting policies, the director's are required to make judgments, estimates and assumption about the carrying values of assets and liabilities that are not readily apparent from other sources. 
The estimates and associated assumptions are based on historical experiences and other factors that are considered 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, if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods. 
The key assumptions and other key sources of uncertainty that have a significant effect of the amount recognised in the financial statements are described below: 
Warranty provisions 
Provisions for damaged or faulty products are calculated and provided for based on historic trends, managements knowledge of products and technological improvements in components. The directors have concluded that the valuations of provisions are appropriate. 
WIP valuation
Work in progress within stock is estimated at: 60% of the final sales value whilst being assembled; 62% once production is complete; and 68% once the product is tested and awaiting delivery. These estimates broadly reflect gross profit margins on the products.

Page 25

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

2023
2022
£
£

Turnover
15,232,404
13,423,842


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
14,704,508
12,685,194

Rest of Europe
527,896
737,195

Rest of the world
-
1,453

15,232,404
13,423,842



5.


Other operating income

2023
2022
£
£

Government grants receivable
2,974
7,053



6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation charge
65,537
77,434

Amortisation charge
19,345
55,534

Auditors' remuneration
37,500
41,355

Exchange differences
1,396
15,878

Other operating lease rentals
304,678
281,025

Defined contributions pension
237,624
217,276

Government grants
(2,974)
(7,053)

Share based payments
17,705
17,705

Page 26

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Auditors' remuneration

During the year, the Group obtained the following services from the Group's auditors:


2023
2022
£
£

Fees payable to the Group's auditors for the audit of the consolidated and parent Company's financial statements
33,000
30,500


8.


Employees

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


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Wages and salaries
4,355,946
3,836,390
17,705
17,705

Social security costs
433,666
458,394
-
-

Cost of defined contribution scheme
237,624
217,276
-
-

5,027,236
4,512,060
17,705
17,705


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



Group
Group
Company
Company
        2023
        2022
        2023
        2022
            No.
            No.
            No.
            No.









Employees
113
100
3
3


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
424,655
420,055

Group contributions to defined contribution pension schemes
13,100
67,933


During the year retirement benefits were accruing to 2 directors (2022 - 3) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £161,802 (2022 - £154,352).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £7,250 (2022 - £6,667).

Page 27

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Income from investments

2023
2022
£
£



Income from current asset investments
7,155
9,239





11.


Interest receivable

2023
2022
£
£


Other interest receivable
87,453
11,965


12.


Interest payable and similar expenses

2023
2022
£
£


Other interest payable
465
-


13.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
491,067
74,700


Total current tax
491,067
74,700

Deferred tax


Origination and reversal of timing differences
(23,601)
-

Total deferred tax
(23,601)
-


Tax on profit
467,466
74,700
Page 28

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
13.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
2,368,888
825,268


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
567,547
156,801

Effects of:


Non-tax deductible amortisation of goodwill and impairment
(11,351)
8,679

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
10,890
25,964

Capital allowances for year in excess of depreciation
-
(6,173)

Increase or decrease in pension fund prepayment leading to an increase (decrease) in tax
-
2,023

Adjustment in research and development tax credit leading to an increase (decrease) in the tax charge
(96,193)
(120,339)

Capital gains
9,607
-

Changes in provisions leading to an increase (decrease) in the tax charge
(829)
9,500

Dividends from UK companies
(2,615)
(1,755)

Deferred tax not recognised
(9,590)
-

Total tax charge for the year
467,466
74,700


14.


Exceptional items

2023
2022
£
£


Repayment of employers' National Insurance contributions
(247,474)
-

Reversal of dilapidation provision
(160,000)
-

(407,474)
-

The above repayment of employers' National Insurance contributions is a correction of an adjustment which was presented in the director's loan account for the year ended 31 December 2021.

Page 29

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Intangible assets

Group





Computer software
Goodwill
Total

£
£
£



Cost


At 1 January 2023
102,123
456,799
558,922


Additions
18,270
-
18,270


Disposals
(16,483)
-
(16,483)



At 31 December 2023

103,910
456,799
560,709



Amortisation


At 1 January 2023
66,491
380,667
447,158


Charge for the year on owned assets
19,345
45,680
65,025


On disposals
(3,245)
-
(3,245)



At 31 December 2023

82,591
426,347
508,938



Net book value



At 31 December 2023
21,319
30,452
51,771



At 31 December 2022
35,632
76,132
111,764



Page 30

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Tangible fixed assets

Group






Plant and machinery
Motor vehicles
Office equipment
Total

£
£
£
£



Cost or valuation


At 1 January 2023
338,147
63,696
27,519
429,362


Additions
2,942
59,450
3,626
66,018


Disposals
-
(17,401)
-
(17,401)



At 31 December 2023

341,089
105,745
31,145
477,979



Depreciation


At 1 January 2023
213,188
47,388
15,821
276,397


Charge for the year on owned assets
42,409
18,629
4,499
65,537


Disposals
-
(11,092)
-
(11,092)



At 31 December 2023

255,597
54,925
20,320
330,842



Net book value



At 31 December 2023
85,492
50,820
10,825
147,137



At 31 December 2022
124,959
16,308
11,698
152,965

Page 31

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

17.


Fixed asset investments

Group





Unlisted investments
Other fixed asset investments
Total

£
£
£



Cost or valuation


At 1 January 2023
100,000
985,286
1,085,286


Additions
-
379,287
379,287


Disposals
-
(1,104,506)
(1,104,506)


Revaluations
-
977
977



At 31 December 2023

100,000
261,044
361,044



Impairment


At 1 January 2023
100,000
-
100,000



At 31 December 2023

100,000
-
100,000



Net book value



At 31 December 2023
-
261,044
261,044



At 31 December 2022
-
985,286
985,286

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2023
2,468,111



At 31 December 2023
2,468,111






Net book value



At 31 December 2023
2,468,111



At 31 December 2022
2,468,111

Page 32

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Lester Control Systems Limited
59 Imperial Way, Croydon, England, CR0 4RR
Ordinary
100%
Sarum Electronics Limited
59 Imperial Way, Croydon, England, CR0 4RR
Ordinary
90%

All subsidiaries have been included within the consolidated financial statements.


18.


Stocks

Group
Group
2023
2022
£
£

Raw materials and consumables
1,395,944
1,423,591

Work in progress (goods to be sold)
407,693
370,022

1,803,637
1,793,613



19.


Debtors

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Trade debtors
2,168,280
2,111,407
-
-

Amounts owed by group undertakings
-
-
2,075
-

Other debtors
124,721
88,137
-
-

Prepayments and accrued income
176,016
180,109
-
-

2,469,017
2,379,653
2,075
-



20.


Cash and cash equivalents

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Cash at bank and in hand
5,751,777
3,505,166
220,034
410,175

Less: bank overdrafts
-
(24,271)
-
-

5,751,777
3,480,895
220,034
410,175


Page 33

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

21.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Bank overdrafts
-
24,271
-
-

Trade creditors
1,404,447
1,895,747
-
-

Amounts owed to group undertakings
-
-
130
87,926

Corporation tax
491,067
77,952
-
-

Other taxation and social security
593,296
476,712
-
-

Other creditors
203,875
275,104
-
131

Accruals and deferred income
195,939
12,425
-
-

2,888,624
2,762,211
130
88,057



22.


Deferred taxation


Group



2023


£






At beginning of year
(28,286)


Charged to profit or loss
23,601



At end of year
(4,685)

Group
Group
2023
2022
£
£

Accelerated capital allowances
(4,685)
(28,286)

(4,685)
(28,286)

Page 34

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

23.


Provisions


Group



Warranty provision
Dilapidations provision
Total

£
£
£





At 1 January 2023
152,037
160,000
312,037


Charged to profit or loss
82,497
-
82,497


Released in year
-
(160,000)
(160,000)



At 31 December 2023
234,534
-
234,534

The warranty provision relates to the costs of faulty item returns.  The timing of payment of these amounts is uncertain and therefore management consider it prudent to include them as a provision.


24.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



4,467 (2022 - 4,467) Ordinary shares of £1.00 each
4,467
4,467
500 (2022 - 500) Ordinary B shares of £1.00 each
500
500

4,967

4,967



25.


Reserves

Capital redemption reserve

A non-distributable reserve into which amounts are transferred following the redemption or purchase of a Company's own shares.

Other reserves

Other reserves relate to the fair value of options granted under the Enterprise Management Incentive Scheme. The reserve is non-distributable.

Merger reserve

Merger reserve arose following the group reconstruction whereby Lester Control Systems (Holdings) Limited combined with Lester Control Systems Limited.

Profit and loss account

Profit and loss account represents retained profits and losses.

Page 35

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

26.


Share-based payments

The Group has an Enterprise Management Incentive Scheme set up in 2019 for two directors. Options are exercisable at a pre-determined price and have vested at the year end date. The options do not include any performance conditions. The options are settled in equity once exercised. The options lapse if they remain unexercised after a period of 10 years from the date of the grant. Options are forfeited if the director leaves the Group before the options are exercised. 
Details of the changes during the year and value of options at the balance sheet date are as follows:

Weighted average exercise price (pence)
2023
Number
2023
Weighted average exercise price
(pence)
2022
Number
2022

Outstanding at the beginning of the year

100

480

100
 
480
 
Outstanding at the end of the year
100

480

100
 
480
 



The assumptions used in the fair value of the share options outstanding are as follows: 
The fair value has been calculated assuming that there will be no dividend yield. 
Volatility was determined by reference to the standard deviation of expected share price returns based on a statistical analysis of daily share prices over a 1 year period to grant date of the market.
 
2023
2022


Expected volatility %
16
16

Risk-free interest rate%
43
43


27.


Capital commitments




At 31 December 2023 the Group had capital commitments as follows:


Group
Group
2023
2022
£
£

Contracted for but not provided in these financial statements
51,156
-

51,156
-

The Group has entered into a website and system contract for a value of £73,080, of which £51,156 is payable after the year end. 

Page 36

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

28.


Commitments under operating leases

At 31 December 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2023
2022
£
£

Not later than 1 year
243,502
177,363

Later than 1 year and not later than 5 years
806,730
672,814

Later than 5 years
429,250
606,000

1,479,482
1,456,177

29.Other financial commitments and guarantees

The Group has a Bonds, Guarantees, Indemnities & Standby LC's facility of £60,000.
Barclays Bank Plc holds a guarantee for £60,000 on the account of a subsidiary in favour of HMRC.


30.


Transactions with directors

2023
2022
        £
        £

Balance brought forward

(231,957)

(165,253)

Advances in the year

278,917

(66,704)

Repayments in the year

-

-

Balance carried forward

46,960

(231,957)


Amounts due from the directors are held within other debtors (2022: other creditors) and are interest-free and repayable on demand.


31.


Related party transactions

The Company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland, not to disclose related party transactions with wholly owned subsidiaries within the group. 
At the balance sheet date the company was owed £2,075 (2022:£Nil) by a subsidiary which is not wholly owned.
Key management personnel received remuneration totalling £1,220,484 (2022: £1,158,664).
Close family members of key management personnel received remuneration of £193,505 (2022: £190,010), which is higher than the market-rate for their roles.

Page 37

LESTER CONTROL SYSTEMS (HOLDINGS) LIMITED
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

32.


Controlling party

The ultimate controlling party is Mr S Davidson, a director.

 
Page 38