Company registration number 06757705 (England and Wales)
PHAROS MARINE AUTOMATIC POWER LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
PHAROS MARINE AUTOMATIC POWER LIMITED
CONTENTS
Page
Directors' report
1 - 2
Independent auditor's report
3 - 5
Profit and loss account
6
Balance sheet
7
Statement of changes in equity
8
Notes to the financial statements
9 - 19
PHAROS MARINE AUTOMATIC POWER LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present their report and financial statements for the year ended 31 December 2023.
Principal activities

The principal activities of the company were that of design, manufacture and sale of navigation aids and related products.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

S Dickinson ( U.S.A )
O James
R Foulkes
(Appointed 30 March 2023)
Research and development

The Company is committed to Research and Development activities in order to maintain its business position as a sector leader in the Marine and Aviation navigation market.

 

Future developments
The Company aims to maintain and strengthen its position and reputation as a supplier of quality products and systems with effective after-sales support, setting us apart from the lower quality, cheaper end of the market.
Auditor

Taylor Viney & Marlow Limited were appointed auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

 

Statement of directors' responsibilities

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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 of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

PHAROS MARINE AUTOMATIC POWER LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Small companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.

By order of the board
R Foulkes
Secretary
16 April 2024
PHAROS MARINE AUTOMATIC POWER LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PHAROS MARINE AUTOMATIC POWER LIMITED
- 3 -
Opinion

We have audited the financial statements of Pharos Marine Automatic Power Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of matter

We draw attention to note 11 in the financial statements regarding the recoverability of a trade debtor.

Our opinion is not modified in respect of this matter.

Conclusions relating to going concern

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

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

PHAROS MARINE AUTOMATIC POWER LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PHAROS MARINE AUTOMATIC POWER LIMITED
- 4 -
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 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:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

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 gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

 

We focussed on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and making enquiries of management. There are inherent limitations in the audit procedures described above and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

PHAROS MARINE AUTOMATIC POWER LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PHAROS MARINE AUTOMATIC POWER LIMITED
- 5 -

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 an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Stuart McCallum
Senior Statutory Auditor
For and on behalf of Taylor Viney & Marlow Limited
16 April 2024
Chartered Accountants
Statutory Auditor
46-54 High Street
Ingatestone
Essex
CM4 9DW
PHAROS MARINE AUTOMATIC POWER LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
Year
Year
ended
ended
31 December
31 December
2023
2022
Notes
£'000
£'000
Turnover
10,907
6,620
Cost of sales
(7,519)
(4,987)
Gross profit
3,388
1,633
Distribution costs
(188)
(179)
Administrative expenses
(2,952)
(3,312)
Other operating income
1
1
Operating profit/(loss)
249
(1,857)
Interest receivable and similar income
2
-
0
Interest payable and similar expenses
(139)
(65)
Amounts written off investments
(34)
2,335
Profit before taxation
78
413
Tax on profit
5
76
301
Profit for the financial year
154
714

The profit and loss account has been prepared on the basis that all operations are continuing operations.

PHAROS MARINE AUTOMATIC POWER LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 7 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Fixed assets
Tangible assets
7
231
292
Investments
8
1
1
232
293
Current assets
Stocks
3,541
2,190
Debtors
10
2,803
1,899
Cash at bank and in hand
285
496
6,629
4,585
Creditors: amounts falling due within one year
11
(5,588)
(3,793)
Net current assets
1,041
792
Total assets less current liabilities
1,273
1,085
Creditors: amounts falling due after more than one year
12
(6)
(12)
Provisions for liabilities
(86)
(47)
Net assets
1,181
1,026
Capital and reserves
Called up share capital
13
3,444
3,443
Profit and loss reserves
(2,263)
(2,417)
Total equity
1,181
1,026

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

The financial statements were approved by the board of directors and authorised for issue on 16 April 2024 and are signed on its behalf by:
O James
Director
Company registration number 06757705 (England and Wales)
PHAROS MARINE AUTOMATIC POWER LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
Share capital
Profit and loss reserves
Total
£'000
£'000
£'000
Balance at 1 January 2022
3,444
(3,131)
313
Period ended 31 December 2022:
Profit and total comprehensive income
-
714
714
Balance at 31 December 2022
3,444
(2,417)
1,026
Period ended 31 December 2023:
Profit and total comprehensive income
-
154
154
Balance at 31 December 2023
3,444
(2,263)
1,181
PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
1
Accounting policies
Company information

Pharos Marine Automatic Power Limited is a private company limited by shares incorporated in England and Wales. The registered office is 14 Castle Mews, Hampton, TW12 2NP.

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 £'000.

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 company meets its day to day working capital requirements through an invoice finance facility and advances from fellow group companies which are repayable on demand. The nature of the company's business is such that there can be considerable unpredictable variation in the timing of cash inflows. The directors consider that the company will continue to operate within the facility currently agreed with the providers of the invoice finance facility. At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources and financial support from fellow group companies to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements. The financial statements do not include any adjustments that would result from a withdrawal of the invoice finance facility or the loans from fellow group companies.

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.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (dependent on contract terms), 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.

 

Where the sales contract is one where we are effectively creating an asset for the customer and we have an enforceable right to be paid for the work completed to date then revenue is recognised over time. The output method is used to determine the extent to which each of the performance obligations has been satisfied.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 10 -
1.5
Intangible fixed assets - goodwill

Negative goodwill arising on the acquisition of trade, assets and liabilities has been written off as follows:

 

Negative goodwill up to the fair values of non-monetary assets acquired are recognised in the profit and loss account in the periods in which non-monetary assets are recovered, whether through depreciation or sale.

 

Negative goodwill arising on monetary assets are recognised in the profit and loss account in the period of benefit.

1.6
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:

Land and buildings Leasehold
10% and 21% per annum - straight line
Plant and machinery
10% - 33% per annum - straight line
Motor vehicles
20% per annum - 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.

1.7
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.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.8
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.

PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -

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

 

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

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

1.9
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

Cost is calculated using the weighted average method.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.10
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.

1.11
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.

PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

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

1.12
Equity instruments

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

1.13
Derivatives

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

 

A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.

1.14
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.

PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
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.

1.15
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.16
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.

1.17
Retirement benefits

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

1.18
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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

PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.19
Foreign exchange

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

2
Judgements and key sources of estimation uncertainty

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

 

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

3
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£'000
£'000
For audit services
Audit of the financial statements of the company
22
17
4
Employees

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

2023
2022
Number
Number
Total
53
45
5
Taxation
2023
2022
£'000
£'000
Current tax
UK corporation tax on profits for the current period
(76)
(301)
PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
5
Taxation
(Continued)
- 15 -

The actual credit for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£'000
£'000
Profit before taxation
78
413
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
15
78
Tax effect of expenses that are not deductible in determining taxable profit
22
1
Tax effect of income not taxable in determining taxable profit
-
0
(444)
Tax effect of utilisation of tax losses not previously recognised
(37)
-
0
Unutilised tax losses carried forward
-
0
347
Permanent capital allowances in excess of depreciation
-
0
(1)
Amortisation on assets not qualifying for tax allowances
-
0
10
Research and development tax credit
(76)
(300)
Deferred tax adjustments
-
0
8
Taxation credit for the period
(76)
(301)
6
Intangible fixed assets
Goodwill
£'000
Cost
At 1 January 2023 and 31 December 2023
(1,584)
Amortisation and impairment
At 1 January 2023 and 31 December 2023
(1,584)
Carrying amount
At 31 December 2023
-
0
At 31 December 2022
-
0
PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
7
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£'000
£'000
£'000
Cost
At 1 January 2023
556
257
813
Additions
-
0
18
18
At 31 December 2023
556
275
831
Depreciation and impairment
At 1 January 2023
327
194
521
Depreciation charged in the year
52
27
79
At 31 December 2023
379
221
600
Carrying amount
At 31 December 2023
177
54
231
At 31 December 2022
229
63
292
8
Fixed asset investments
2023
2022
£'000
£'000
Shares in group undertakings and participating interests
1
1
9
Subsidiaries

Separate company financial statements are required to be prepared by law.

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

Name of undertaking
Address
Nature of business
Class of
% Held
shares held
Direct
Automatic Power Ltd
1
Dormant
Ordinary
100.00
Sims Systems Limited
2
Dormant
Ordinary
100.00

Registered office addresses (all UK unless otherwise indicated):

1,2
14 Castle Mews, Hampton, TW12 2NP

The investments in subsidiaries are all stated at cost.

PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
10
Debtors
2023
2022
Amounts falling due within one year:
£'000
£'000
Trade debtors
2,405
1,370
Corporation tax recoverable
76
301
Other debtors
62
45
Prepayments and accrued income
260
183
2,803
1,899
11
Creditors: amounts falling due within one year
2023
2022
£'000
£'000
Obligations under finance leases
5
5
Payments received on account
359
698
Trade creditors
2,427
1,265
Amounts owed to group undertakings
806
625
Taxation and social security
91
55
Other creditors
899
520
Accruals and deferred income
1,001
625
5,588
3,793

Invoice discounting advances are secured by way of a charge over all land belonging to the company. The amount secured is included within other creditors and at the balance sheet date was £899,459 (2022: £520,317).

12
Creditors: amounts falling due after more than one year
2023
2022
£'000
£'000
Other creditors
6
12
PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
13
Called up share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
3,443,494 Ordinary shares of £1 each
3,443,494
3,443,494
20 Ordinary A shares of £1 each
20
20
3,443,514
3,443,514

The company has two classes of ordinary shares which carry no right to fixed income.

14
Financial commitments, guarantees and contingent liabilities

At 31 December 2023 outstanding guarantees issued amounted to £Nil (2022: £57,154).

15
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
£'000
£'000
630
777
16
Related party transactions
Transactions with related parties

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

Sales
Purchases
2023
2022
2023
2022
£'000
£'000
£'000
£'000
AB Pharos Marine PTE Limited
1,067
605
2
2
Pharos Marine Automatic Power, Inc
332
175
809
(462)
Management recharges payable
2023
2022
£'000
£'000
Pharos Marine Automatic Power, Inc
-
132
PHAROS MARINE AUTOMATIC POWER LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
16
Related party transactions
(Continued)
- 19 -

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£'000
£'000
Sims Systems Limited
1
1
Pharos Marine Automatic Power, Inc
866
521
Other related parties
63
103

 

17
Parent company

The parent company of Pharos Marine Automatic Power Limited is Pharos Holdings, Inc and its registered office is 2970 Peachtree Road, Suite 510, Atlanta, Ga, 30305.

The ultimate controlling party of Pharos Marine Automatic Power Limited is Pharos Holdings Inc, a company incorporated and registered in the U.S.A. Group financial information can be obtained from Pharos Marine Automatic Power Ltd, 14 Castle Mews, Hampton, TW12 2NP.

 

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