REGISTERED NUMBER: |
Strategic Report, Report of the Director and |
Financial Statements for the Year Ended 31 August 2023 |
for |
KPPES Ltd |
REGISTERED NUMBER: |
Strategic Report, Report of the Director and |
Financial Statements for the Year Ended 31 August 2023 |
for |
KPPES Ltd |
KPPES Ltd (Registered number: SC349485) |
Contents of the Financial Statements |
for the Year Ended 31 August 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Director | 4 |
Report of the Independent Auditors | 5 |
Statement of Comprehensive Income | 8 |
Balance Sheet | 9 |
Statement of Changes in Equity | 10 |
Cash Flow Statement | 11 |
Notes to the Cash Flow Statement | 12 |
Notes to the Financial Statements | 13 |
KPPES Ltd |
Company Information |
for the Year Ended 31 August 2023 |
DIRECTOR: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants and Statutory Auditors |
145 St Vincent Street |
Glasgow |
G2 5JF |
KPPES Ltd (Registered number: SC349485) |
Strategic Report |
for the Year Ended 31 August 2023 |
The director presents his strategic report for the year ended 31 August 2023. |
REVIEW OF BUSINESS |
The company provides a payroll umbrella service. |
The company’s income comprises gross salaries received together with an appropriate margin for service. The accounts reflect pre-tax profits of £13,087 (2022: £14,670) and balance sheet reserves of £114,943 (2022: £114,061). |
Turnover has increased by 7% to £44,217,238 compared with £41,334,295 in 2022, with a continued high number of employees using the umbrella service. |
The gross profit margin reflects an increase in gross profit to £788,260 compared to £707,838 in 2022. |
Administrative expenses have been well controlled, with only a modest increase in costs from £97,969 to £111,615. |
The balance sheet continues to present a solid position, with net assets increased from £114,061 on 31st August 2022 to £114,943, and balances at the bank totalling £1,273,736. |
The directors would like to thank all employees for their commitment and hard work over the last 12 months. |
PRINCIPAL RISKS AND UNCERTAINTIES |
The following risks and associated mitigation processes represent the key risks and uncertainties which affect the company and how the directors address these. They are not intended to be an exhaustive analysis of all the risks facing the business. |
1. COVID-19 |
Risks: |
The last three years has exposed the majority of businesses to the economic impact of a global pandemic. While the threat of a pandemic has dissipated, there remains the possibility that other variants could materialise and restrictions reintroduced. |
Mitigating processes: |
While mitigating actions will depend on the nature and extent of any pandemic, the company remains resilient given its ability to re-introduce measures in place during the pandemic to facilitate continued trade. |
2. Economic risks |
Risks: |
The company's business operations are sensitive to economic conditions and, in particular, to inflationary pressures as well as the cost of living crisis which could affect salary increases. |
Mitigation processes: |
The directors regularly review the impact of the economic conditions on the company's budget and strategic plans, to ensure that we maintain our competitive position in the market. |
3. People risks |
Risks: |
We recognise the importance of attracting, retaining, developing and motivating the best people to help take our business forward and to ensure that we can deliver our operational and strategic objectives. Failure to attract these individuals could impact our ability to achieve our operational and strategic objectives. |
Mitigation processes: |
Directors aim to recruit the best people with the right skills and offer training and development programmes to ensure that we retain them. Staff contracts and turnover trends are reviewed and benchmarked to highlight any potential issues. |
KPPES Ltd (Registered number: SC349485) |
Strategic Report |
for the Year Ended 31 August 2023 |
FUTURE DEVELOPMENTS |
Although trading conditions in the current climate remain challenging, the directors continue to investigate opportunities to grow the business and extend the range of services offered. |
ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHER RELATIONSHIPS |
Delivering our strategy requires strong mutually beneficial relationships with suppliers, customers and other operational partners. KPPES seeks the promotion and application of certain general principles in such relationships. |
The ability to promote these principles effectively is an important factor in the decision to enter into or remain in such relationships. |
The business continuously assesses the priorities related to customers and those with whom we do business, and the Directors engage with the businesses on these topics, for example, within the context of working safely. |
Moreover, the Directors receive information updates on a variety of topics that indicate and inform how these stakeholders have been engaged and are performing with and on behalf of the Company. |
ON BEHALF OF THE BOARD: |
KPPES Ltd (Registered number: SC349485) |
Report of the Director |
for the Year Ended 31 August 2023 |
The director presents his report with the financial statements of the company for the year ended 31 August 2023. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 August 2023. |
DIRECTOR |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
KPPES Ltd |
Opinion |
We have audited the financial statements of KPPES Ltd (the 'company') for the year ended 31 August 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 August 2023 and of its 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 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. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the director's 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 director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
KPPES Ltd |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Director. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on page four, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following: |
- the nature of the industry and sector, control environment and business performance; |
- results of our enquiries of management about their own identification and assessment of the risks and irregularities; |
- any matters we identified having reviewed the company's internal controls established to mitigate risks of fraud or non- compliance with laws and regulations; |
- the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. |
We obtained an understanding of the legal and regulatory framework that the company operates in. The key laws and regulations we considered included the UK Companies Act and tax legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. In addition we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate. These included health and safety, GDPR and employment laws. Auditing standards limit the required audit procedures to identify non - compliance with these laws and regulations to enquiry of the directors, inspection of regulatory and legal correspondence, if any, and review of minutes of meetings. These limited procedures did not identify actual or suspected non-compliance. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Report of the Independent Auditors to the Members of |
KPPES Ltd |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Chartered Accountants and Statutory Auditors |
145 St Vincent Street |
Glasgow |
G2 5JF |
KPPES Ltd (Registered number: SC349485) |
Statement of Comprehensive Income |
for the Year Ended 31 August 2023 |
31.8.23 | 31.8.22 |
Notes | £ | £ |
TURNOVER |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Distribution costs | ( |
) | ( |
) |
Administrative expenses | ( |
) | ( |
) |
OPERATING PROFIT and |
PROFIT BEFORE TAXATION |
Tax on profit | 5 | ( |
) | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
KPPES Ltd (Registered number: SC349485) |
Balance Sheet |
31 August 2023 |
31.8.23 | 31.8.22 |
Notes | £ | £ |
FIXED ASSETS |
Intangible assets | 6 |
Tangible assets | 7 |
CURRENT ASSETS |
Debtors | 8 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 9 | ( |
) | ( |
) |
NET CURRENT LIABILITIES | ( |
) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CAPITAL AND RESERVES |
Called up share capital | 10 |
Retained earnings | 11 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the director and authorised for issue on |
KPPES Ltd (Registered number: SC349485) |
Statement of Changes in Equity |
for the Year Ended 31 August 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 September 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 August 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 August 2023 |
KPPES Ltd (Registered number: SC349485) |
Cash Flow Statement |
for the Year Ended 31 August 2023 |
31.8.23 | 31.8.22 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | ( |
) | ( |
) |
Tax paid | ( |
) | ( |
) |
Net cash from operating activities | ( |
) | ( |
) |
Cash flows from investing activities |
Purchase of intangible fixed assets | ( |
) |
Net cash from investing activities | ( |
) |
Decrease in cash and cash equivalents | ( |
) | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
2,000,791 |
Cash and cash equivalents at end of year | 2 | 1,273,736 | 1,691,923 |
KPPES Ltd (Registered number: SC349485) |
Notes to the Cash Flow Statement |
for the Year Ended 31 August 2023 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
31.8.23 | 31.8.22 |
£ | £ |
Profit before taxation |
Depreciation charges |
62,197 | 63,800 |
Increase in trade and other debtors | ( |
) | ( |
) |
Decrease in trade and other creditors | ( |
) | ( |
) |
Cash generated from operations | ( |
) | ( |
) |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 August 2023 |
31.8.23 | 1.9.22 |
£ | £ |
Cash and cash equivalents | 1,273,736 | 1,691,923 |
Year ended 31 August 2022 |
31.8.22 | 1.9.21 |
£ | £ |
Cash and cash equivalents | 1,691,923 | 2,000,791 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.9.22 | Cash flow | At 31.8.23 |
£ | £ | £ |
Net cash |
Cash at bank | 1,691,923 | (418,187 | ) | 1,273,736 |
1,691,923 | ( |
) | 1,273,736 |
Total | 1,691,923 | (418,187 | ) | 1,273,736 |
KPPES Ltd (Registered number: SC349485) |
Notes to the Financial Statements |
for the Year Ended 31 August 2023 |
1. | STATUTORY INFORMATION |
KPPES Ltd is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Related party exemption |
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. |
Turnover |
Turnover represents the net invoiced fees for payroll processing on behalf of various employment agencies. Previously the turnover represented the amounts received or receivable by the company in return for its performance of duties under contractual arrangements with the employees. |
Goodwill |
Goodwill, being the amount paid in connection with the acquisition of a business in 2014 and was being amortised over its estimated useful of one year. |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost |
less any accumulated amortisation and any accumulated impairment losses. |
The development costs are capitalised as there is a clearly defined project, with separately identifiable costs which will be commercially viable and provide benefit to the company over the next ten years. |
Development costs are being amortised evenly over their estimated useful life of ten years. |
Tangible fixed assets |
Fixtures and fittings | - |
The company's policy is to review the remaining useful economic lives and residual value of all tangible fixed assets on an on-going basis and to adjust the depreciation charge to reflect the remaining useful economic life and residual value. |
Fully depreciated assets are retained in cost and related accumulated depreciation until they are removed from service. In the case of disposals, assets and related depreciation are removed from the financial statements and the net amount, less proceeds from disposal, is charged or credited to the income statement |
KPPES Ltd (Registered number: SC349485) |
Notes to the Financial Statements - continued |
for the Year Ended 31 August 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
The Company enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors and loans from banks. |
Debtors |
Trade debtors and other debtors are recognised at the settlement amount due with appropriate allowances for any irrecoverable amounts when there is objective evidence the asset is impaired. |
Cash and cash equivalents |
Cash and cash equivalent in the balance sheet comprise cash at bank and in hand. |
Creditors |
Trade creditors and other creditors are recognised where the company has a present obligation resulting from a past event and are recognised at the settlement amount due after allowing for any trade discounts due. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Pension costs and other post-retirement benefits |
The Company operates a number of defined contribution plans for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity and has no further payment obligations. |
The contributions are recognised as an expense in profit or loss in the period as employees provide service. Amounts due but unpaid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds. |
Government grants |
Government Grants received are recognised when there is reasonable assurance that the company complies with any conditions. The grant is recognised as income to match with the related costs. |
KPPES Ltd (Registered number: SC349485) |
Notes to the Financial Statements - continued |
for the Year Ended 31 August 2023 |
3. | EMPLOYEES AND DIRECTORS |
31.8.23 | 31.8.22 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
31.8.23 | 31.8.22 |
Contractors |
31.8.23 | 31.8.22 |
£ | £ |
Director's remuneration |
4. | OPERATING PROFIT |
The operating profit is stated after charging: |
31.8.23 | 31.8.22 |
£ | £ |
Depreciation - owned assets |
Development costs amortisation |
Auditors' remuneration |
5. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
31.8.23 | 31.8.22 |
£ | £ |
Current tax: |
UK corporation tax |
Tax on profit |
KPPES Ltd (Registered number: SC349485) |
Notes to the Financial Statements - continued |
for the Year Ended 31 August 2023 |
5. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
31.8.23 | 31.8.22 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Depreciation in excess of capital allowances |
Total tax charge | 12,205 | 12,122 |
6. | INTANGIBLE FIXED ASSETS |
Development |
Goodwill | costs | Totals |
£ | £ | £ |
COST |
At 1 September 2022 |
Additions |
At 31 August 2023 |
AMORTISATION |
At 1 September 2022 |
Amortisation for year |
At 31 August 2023 |
NET BOOK VALUE |
At 31 August 2023 |
At 31 August 2022 |
KPPES Ltd (Registered number: SC349485) |
Notes to the Financial Statements - continued |
for the Year Ended 31 August 2023 |
7. | TANGIBLE FIXED ASSETS |
Fixtures |
and |
fittings |
£ |
COST |
At 1 September 2022 |
and 31 August 2023 |
DEPRECIATION |
At 1 September 2022 |
Charge for year |
At 31 August 2023 |
NET BOOK VALUE |
At 31 August 2023 |
At 31 August 2022 |
8. | DEBTORS |
31.8.23 | 31.8.22 |
£ | £ |
Amounts falling due within one year: |
Trade debtors |
Other debtors | 4,790 | - |
Amounts falling due after more than one year: |
KPS loan |
Aggregate amounts |
9. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.8.23 | 31.8.22 |
£ | £ |
Trade creditors |
Tax |
Social security and other taxes |
VAT | 791,951 | 1,049,502 |
Other creditors |
Accrued expenses |
10. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 31.8.23 | 31.8.22 |
value: | £ | £ |
Ordinary Shares | 1 | 2 | 2 |
KPPES Ltd (Registered number: SC349485) |
Notes to the Financial Statements - continued |
for the Year Ended 31 August 2023 |
11. | RESERVES |
Retained |
earnings |
£ |
At 1 September 2022 |
Profit for the year |
At 31 August 2023 |
12. | ULTIMATE CONTROLLING PARTY |
The controlling party is Key Employment Outsourcing Ltd. |
The ultimate controlling party is Lynsey Melville as 100% shareholder in Key Employment Outsourcing Ltd which holds 100% of the share capital of KPPES Ltd. |