Company registration number SC434959 (Scotland)
INNOVO ENGINEERING AND CONSTRUCTION LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
PAGES FOR FILING WITH REGISTRAR
INNOVO ENGINEERING AND CONSTRUCTION LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 10
INNOVO ENGINEERING AND CONSTRUCTION LIMITED
BALANCE SHEET
AS AT 31 OCTOBER 2023
31 October 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
4
88,530
618,905
Tangible assets
5
1,041,419
1,251,478
Investments
6
8,602
8,602
1,138,551
1,878,985
Current assets
Debtors
8
2,847,180
1,291,087
Cash at bank and in hand
1,388,874
137,094
4,236,054
1,428,181
Creditors: amounts falling due within one year
9
(2,839,710)
(2,182,242)
Net current assets/(liabilities)
1,396,344
(754,061)
Total assets less current liabilities
2,534,895
1,124,924
Creditors: amounts falling due after more than one year
10
(303,454)
(502,975)
Provisions for liabilities
(199,335)
-
0
Net assets
2,032,106
621,949
Capital and reserves
Called up share capital
2
2
Profit and loss reserves
2,032,104
621,947
Total equity
2,032,106
621,949

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

For the financial year ended 31 October 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

INNOVO ENGINEERING AND CONSTRUCTION LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 OCTOBER 2023
31 October 2023
- 2 -
The financial statements were approved by the board of directors and authorised for issue on 31 July 2024 and are signed on its behalf by:
Mr. G Millard
Director
Company Registration No. SC434959
INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 3 -
1
Accounting policies
Company information

Innovo Engineering and Construction Limited (SC434959) is a private company limited by shares incorporated in Scotland. The registered office is 37 Albyn Place, Aberdeen, United Kingdom, AB10 1JB. The main business address is Torridon House, 73-75 Regents Quary, Aberdeen, AB11 5AR.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.

1.2
Going concern

The directors and shareholders have considered the current performance in the year and has carefully considered the level of cash reserves required to enable the business to operate for at least 12 months from the date of approval of the financial statements. The directors have formed the judgement that at the time of approving the financial statements, the Company has adequate cash and liquid resources to continue in operational existence for the foreseeable future. For this reason the going concern basis continues to be adopted in preparing the financial statements.

 

The directors are satisfied that these events do not affect the company's ability to continue as a going concern and this basis is appropriate for the preparation of the accounts.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 4 -
1.4
Intangible fixed assets other than goodwill

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.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Patents & licences
- 10% straight line
Development costs
- 10% straight line
1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and equipment
- 10% straight line
Computers
- 25% straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.6
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities. Investments in equity instruments that are subsidiaries are initially measured at cost and subsequently carried at cost less any accumulated impairment losses. Cost includes long-term loan funding where repayment is not expected in the foreseeable future. Investment in subsidiaries whose share capital is denominated in a foreign currency are translated at the rate prevailing on the date the share capital was acquired.

1.7
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 5 -

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.9
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans and loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

1.10
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 6 -
1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.15
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 7 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Total
4
4
4
Intangible fixed assets
Patents
Development Costs
Total
£
£
£
Cost
At 1 November 2022
348,395
495,535
843,930
Disposals
-
0
(495,535)
(495,535)
At 31 October 2023
348,395
-
0
348,395
Amortisation and impairment
At 1 November 2022
225,025
-
0
225,025
Amortisation charged for the year
34,840
-
0
34,840
At 31 October 2023
259,865
-
0
259,865
Carrying amount
At 31 October 2023
88,530
-
0
88,530
At 31 October 2022
123,370
495,535
618,905
INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 8 -
5
Tangible fixed assets
Plant and equipment
Computers
Total
£
£
£
Cost
At 1 November 2022 and 31 October 2023
2,098,440
58,376
2,156,816
Depreciation and impairment
At 1 November 2022
847,177
58,161
905,338
Depreciation charged in the year
209,844
215
210,059
At 31 October 2023
1,057,021
58,376
1,115,397
Carrying amount
At 31 October 2023
1,041,419
-
0
1,041,419
At 31 October 2022
1,251,263
215
1,251,478
6
Fixed asset investments
2023
2022
£
£
Shares in group undertakings and participating interests
8,602
8,602
7
Subsidiaries

Details of the company's subsidiaries at 31 October 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Innovo Mediterranean Services srl
Italy
Engineering & Consultancy
Ordinary
100.00
8
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
339,274
284,272
Amounts owed by group undertakings
1,013,939
917,102
Amounts owed by undertakings in which the company has a participating interest
300
9,983
Other debtors
76,124
30,104
Prepayments and accrued income
1,417,543
47,688
2,847,180
1,289,149
INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
8
Debtors
(Continued)
- 9 -
2023
2022
Amounts falling due after more than one year:
£
£
Other debtors
-
0
1,938
Total debtors
2,847,180
1,291,087

Amounts owed by group undertakings are unsecured, interest free and repayable on demand.

9
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans
200,000
200,000
Trade creditors
1,156,469
386,277
Amounts owed to group undertakings
606,119
1,169,942
Corporation tax
133,555
-
0
Other taxation and social security
23,288
18,564
Other creditors
36,094
123,031
Accruals and deferred income
684,185
284,428
2,839,710
2,182,242

Amounts owed to group undertakings are unsecured, interest free and repayable on demand.

10
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
303,454
502,975
11
Secured debts

The following secured debts are included within creditors:

 

Bank loans: 2023 - £503,454 (2022 - £702,975).

 

Virgin Money (formerly Clydesdale Bank PLC) holds a floating charge over the whole of the property or undertaking of the company in respect of all present and future obligations and liabilities. The charge contains a negative pledge.

INNOVO ENGINEERING AND CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 10 -
12
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

2023
2022
£
£
-
0
1,400
13
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Former director

£42,856 (2022 - £nil) was repaid to the former director during the year. There was a balance of £nil due to the former director at the reporting end date (2022 - £42,856).

 

The loan is unsecured, interest free, repayable on demand and is included within Other Creditors shown in note 10 to the accounts.

14
Directors' transactions

£42,855 (2022 - £nil) was repaid to a director during the year. At the balance sheet date there is a loan balance due to a director of £2,824 (2022 - £45,679).

 

The loan is unsecured, interest free, repayable on demand and is included within Other Creditors shown in note 10 to the accounts.

 

15
Parent company

The company is a wholly owned subsidiary of YTEK SRL.

 

YTEK SRL is an Italian Holding Company owned by S Malagodi and A Tiberio

 

The Ultimate Controlling Party is S Malagodi.

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