Company registration number 06059823 (England and Wales)
MS AUTOMOTIVE (LONDON) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2023
MS AUTOMOTIVE (LONDON) LIMITED
COMPANY INFORMATION
Director
M Sharma
Company number
06059823
Registered office
International House
36-38 Cornhill
London
EC3V 3NG
Auditor
Eacotts International Limited
Grenville Court
Britwell Road
Burnham
Buckinghamshire
SL1 8DF
Business address
Minories House
2-5 Minories
London
EC3N 1BJ
MS AUTOMOTIVE (LONDON) LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2
Director's responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 21
MS AUTOMOTIVE (LONDON) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2023
- 1 -
The director presents the strategic report for the year ended 31 August 2023.
Review of the business
The results for the year and the financial position at the year-end were considered to be a fair reflection of the continuing market conditions. The effects of the Pandemic are now very much in the past and most businesses have recovered from the effects. However, the effects of Brexit have negatively affected the cost of conducting business in Europe. We have been working hard to ensure that we can leave Brexit behind. Any result that allows continuity remains an acceptable result. The director will continue to support the business as the company’s future is bright.
We have moved on from trying to manage the business in difficult and challenging conditions, to building revenues for the future. Our revenues from the GCC have grown. We have continued to invest in new opportunities that the director believes will generate income. Our revenues from the reinsurance business in GCC region have improved and we have seen growth. We will continue to work on new products and opportunities in the region. We have new relationships that the directors has been building for some time. These will result in new revenue.
The two new European Binding Authorities for specialist classes of Insurance have generated good income. However, new UK contract for motor fleet business has had a slow start. The existing European Binding Authorities have regained good income levels and all lines will grow in the coming 12 months. We are working on two new classes for our European Coverholder, and they will go live next year.
We are continuing to reduce costs and the net effect is evident in the results, and will be even more visible next year.
The director saw an opportunity in Australia and we have a new specialist class Binding Authority with a new Coverholder in Australia now. We have also been appointed as broker of record on an existing facility by the Coverholder, that will bring more new income next year.
We have also placed a new non-motor Binding Authority for an established UK MGA, that will go live in the next financial year.
The business environment in which the company operates will continue to be challenging. The UK insurance motor insurance market is evolving and is not what it was. With foresight, we have invested in new motor products and additional classes to respond to the changing markets and conditions. We are actively working on opportunities from the Middle East, Far East, Canada, Australia, Europe and India.
The company is aware that any future plans for development of the business may be subject to unforeseen future events outside its control.
The company remains true to its values and the stamina to achieve our goals is stronger than ever.
M Sharma
Director
30 August 2024
MS AUTOMOTIVE (LONDON) LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 AUGUST 2023
- 2 -
The director presents his annual report and financial statements for the year ended 31 August 2023.
Principal activities
The principal activity of the company is that of insurance and reinsurance broking.
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
M Sharma
Auditor
The auditor, Eacotts International Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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.
Small companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
On behalf of the board
M Sharma
Director
30 August 2024
MS AUTOMOTIVE (LONDON) LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 AUGUST 2023
- 3 -
The director is responsible for preparing the annual report 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;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
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 them 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.
MS AUTOMOTIVE (LONDON) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF MS AUTOMOTIVE (LONDON) LIMITED
- 4 -
Opinion
We have audited the financial statements of MS Automotive (London) Limited (the 'company') for the year ended 31 August 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows 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:
give a true and fair view of the state of the company's affairs as at 31 August 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is 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:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
MS AUTOMOTIVE (LONDON) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF MS AUTOMOTIVE (LONDON) LIMITED
- 5 -
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 and the director's 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, 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit; or
the director was not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption in preparing the director's report.
Responsibilities of director
As explained more fully in the director's responsibilities statement, 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 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 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.
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.
In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:
obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company operates in and how the company is complying with the legal and regulatory framework;
inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;
discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.
MS AUTOMOTIVE (LONDON) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF MS AUTOMOTIVE (LONDON) LIMITED
- 6 -
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members; and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
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. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error.
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.
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Mr Brandis Savizon FCCA
Senior Statutory Auditor
For and on behalf of Eacotts International Limited
Accountants
ICAEW Registered Auditors
Grenville Court
Britwell Road
Burnham
Buckinghamshire
SL1 8DF
MS AUTOMOTIVE (LONDON) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2023
- 7 -
2023
2022
Notes
£
£
Turnover
2
484,974
361,951
Administrative expenses
(534,432)
(593,360)
Other operating income
16,267
Operating loss
3
(49,458)
(215,142)
Interest receivable and similar income
6
135
12
Interest payable and similar expenses
8
(948)
(872)
Loss before taxation
(50,271)
(216,002)
Tax on loss
9
280
10,234
Loss for the financial year
(49,991)
(205,768)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
MS AUTOMOTIVE (LONDON) LIMITED
BALANCE SHEET
AS AT
31 AUGUST 2023
31 August 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
433
1,554
Current assets
Debtors
12
1,645,256
2,527,578
Cash at bank and in hand
589,443
1,223,524
2,234,699
3,751,102
Creditors: amounts falling due within one year
13
(2,500,438)
(3,957,971)
Net current liabilities
(265,739)
(206,869)
Total assets less current liabilities
(265,306)
(205,315)
Creditors: amounts falling due after more than one year
14
(22,500)
(32,500)
Net liabilities
(287,806)
(237,815)
Capital and reserves
Called up share capital
18
102
102
Profit and loss reserves
(287,908)
(237,917)
Total equity
(287,806)
(237,815)
The financial statements were approved and signed by the director and authorised for issue on 30 August 2024
M Sharma
Director
Company registration number 06059823 (England and Wales)
MS AUTOMOTIVE (LONDON) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2023
- 9 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 September 2021
102
(32,149)
(32,047)
Year ended 31 August 2022:
Loss and total comprehensive income
-
(205,768)
(205,768)
Balance at 31 August 2022
102
(237,917)
(237,815)
Year ended 31 August 2023:
Loss and total comprehensive income
-
(49,991)
(49,991)
Balance at 31 August 2023
102
(287,908)
(287,806)
MS AUTOMOTIVE (LONDON) LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 AUGUST 2023
- 10 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
21
(650,268)
571,992
Interest paid
(948)
(872)
Income taxes refunded
27,000
18,113
Net cash (outflow)/inflow from operating activities
(624,216)
589,233
Investing activities
Interest received
135
12
Net cash generated from investing activities
135
12
Financing activities
Proceeds from new bank loans
50,000
Repayment of bank loans
(10,000)
(7,500)
Net cash (used in)/generated from financing activities
(10,000)
42,500
Net (decrease)/increase in cash and cash equivalents
(634,081)
631,745
Cash and cash equivalents at beginning of year
1,223,524
591,779
Cash and cash equivalents at end of year
589,443
1,223,524
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2023
- 11 -
1
Accounting policies
Company information
MS Automotive (London) Limited is a private company limited by shares incorporated in England and Wales. The registered office is International House, 36-38 Cornhill, London, EC3V 3NG.
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.
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.
1.2
Going concern
Atruet the time of approving the financial statements, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future as the company is fully supported by its shareholder and director. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
The company has taken the necessary steps in terms of regulatory and administrative registrations to allow it to be able to keep the business in the EU post Brexit.
1.3
Turnover
Turnover represents insurance brokerage fees which are recognised as income based on the insurance inception date.
Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the profit and loss account turnover and related costs as contract activity progresses. Turnover is calculated as that proportion of total contract value which costs to date bear to total expected costs for that contract.
1.4
Intangible fixed assets - goodwill
Intangible assets comprises of goodwill. Such assets are defined as having finite useful lives and the costs are amortised on a straight line basis over their estimated useful lives of 5 years. Intangible assets are stated at cost less amortisation and are reviewed for impairment whenever there is an indication that the carrying value may be impaired.
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:
Fixtures, fittings & equipment
15%-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.
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 12 -
1.6
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.
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.
1.7
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.
1.8
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.
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 13 -
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.
1.9
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.
1.10
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.
1.11
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.
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 14 -
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
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.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
1.14
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
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.
2
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Insurance and reinsurance broking
484,974
361,951
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
77,110
99,156
Europe (EEA)
34,969
35,823
Rest of the world
372,895
226,972
484,974
361,951
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
2
Turnover and other revenue
(Continued)
- 15 -
2023
2022
£
£
Other revenue
Interest income
135
12
Grants received
-
12,767
The Government grant income relates to amounts received under the Coronavirus Job Retention Scheme.
3
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(7,516)
1,337
Government grants
-
(12,767)
Depreciation of owned tangible fixed assets
1,121
1,121
Operating lease charges
3,177
31,627
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
16,800
15,434
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Broking staff
3
4
Management and administration
2
2
Total
5
6
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
245,820
265,083
Social security costs
27,961
28,057
Pension costs
40,407
45,117
314,188
338,257
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 16 -
6
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
135
12
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
135
12
7
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
121,758
120,641
Company pension contributions to defined contribution schemes
8,500
12,000
130,258
132,641
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
948
872
9
Taxation
2023
2022
£
£
Deferred tax
Origination and reversal of timing differences
(280)
(10,234)
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
9
Taxation
(Continued)
- 17 -
The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(50,271)
(216,002)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
(9,551)
(41,040)
Tax effect of expenses that are not deductible in determining taxable profit
1,477
Unutilised tax losses carried forward
9,551
39,350
Permanent capital allowances in excess of depreciation
213
Deferred tax movement
(280)
(10,234)
Taxation credit for the year
(280)
(10,234)
10
Intangible fixed assets
Goodwill
£
Cost
At 1 September 2022 and 31 August 2023
302,500
Amortisation and impairment
At 1 September 2022 and 31 August 2023
302,500
Carrying amount
At 31 August 2023
At 31 August 2022
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 18 -
11
Tangible fixed assets
Fixtures, fittings & equipment
£
Cost
At 1 September 2022 and 31 August 2023
36,865
Depreciation and impairment
At 1 September 2022
35,311
Depreciation charged in the year
1,121
At 31 August 2023
36,432
Carrying amount
At 31 August 2023
433
At 31 August 2022
1,554
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,567,930
2,472,145
Other debtors
1,272
1,272
Prepayments and accrued income
25,993
4,380
1,595,195
2,477,797
2023
2022
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 16)
50,061
49,781
Total debtors
1,645,256
2,527,578
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 19 -
13
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
15
10,000
10,000
Trade creditors
2,194,453
3,669,909
Corporation tax
(27,000)
Other taxation and social security
8,659
8,961
Other creditors
57,000
64,461
Accruals and deferred income
230,326
231,640
2,500,438
3,957,971
14
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
15
22,500
32,500
15
Loans and overdrafts
2023
2022
£
£
Bank loans
32,500
42,500
Payable within one year
10,000
10,000
Payable after one year
22,500
32,500
Included in borrowings is a bounce back loan totalling £42,500. Repayments of the loan started on 16th December 2021 and are repayable monthly until the final repayment on 17th November 2026. Interest is charged on the loan at 2.5% per annum. Under the Government incentive scheme following COVID-19 the first year interest charges were subsidised by the Government.
16
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Assets
Assets
2023
2022
Balances:
£
£
Accelerated capital allowances
(109)
(389)
Director's loan
50,170
50,170
50,061
49,781
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
16
Deferred taxation
(Continued)
- 20 -
2023
Movements in the year:
£
Asset at 1 September 2022
(49,781)
Credit to profit or loss
(280)
Asset at 31 August 2023
(50,061)
17
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
40,407
45,117
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
18
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
102 Ordinary shares of £1 each
102
102
Total number of issued share capital of the company is 10,000 shares of £1 each. Of those, 2 shares were called up, issued and fully paid. The remaining 9,998 share were partly called up and partly paid by 1p per share.
19
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
2,065
20
Directors' transactions
Included in creditors is £257,641 (2022: £265,141 ) due to M Sharma.
Included in trade creditors is £4,566 (2022: £4,566) due to M Sharma.
MS AUTOMOTIVE (LONDON) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 21 -
21
Cash (absorbed by)/generated from operations
2023
2022
£
£
Loss for the year after tax
(49,991)
(205,768)
Adjustments for:
Taxation credited
(280)
(10,234)
Finance costs
948
872
Investment income
(135)
(12)
Depreciation and impairment of tangible fixed assets
1,121
1,121
Movements in working capital:
Decrease/(increase) in debtors
882,602
(799,281)
(Decrease)/increase in creditors
(1,484,533)
1,585,294
Cash (absorbed by)/generated from operations
(650,268)
571,992
22
Analysis of changes in net funds
1 September 2022
Cash flows
31 August 2023
£
£
£
Cash at bank and in hand
1,223,524
(634,081)
589,443
Borrowings excluding overdrafts
(42,500)
10,000
(32,500)
1,181,024
(624,081)
556,943
MS AUTOMOTIVE (LONDON) LIMITED
MANAGEMENT INFORMATION
FOR THE YEAR ENDED 31 AUGUST 2023
2023-08-312022-09-01falseCCH SoftwareCCH Accounts Production 2024.100M Sharmafalsefalse060598232022-09-012023-08-3106059823bus:Director12022-09-012023-08-3106059823bus:RegisteredOffice2022-09-012023-08-31060598232023-08-31060598232021-09-012022-08-3106059823core:RetainedEarningsAccumulatedLosses2021-09-012022-08-3106059823core:RetainedEarningsAccumulatedLosses2022-09-012023-08-31060598232022-08-3106059823core:FurnitureFittings2023-08-3106059823core:FurnitureFittings2022-08-3106059823core:CurrentFinancialInstrumentscore:WithinOneYear2023-08-3106059823core:CurrentFinancialInstrumentscore:WithinOneYear2022-08-3106059823core:Non-currentFinancialInstrumentscore:AfterOneYear2023-08-3106059823core:Non-currentFinancialInstrumentscore:AfterOneYear2022-08-3106059823core:CurrentFinancialInstruments2023-08-3106059823core:CurrentFinancialInstruments2022-08-3106059823core:ShareCapital2023-08-3106059823core:ShareCapital2022-08-3106059823core:RetainedEarningsAccumulatedLosses2023-08-3106059823core:RetainedEarningsAccumulatedLosses2022-08-3106059823core:ShareCapital2021-08-3106059823core:RetainedEarningsAccumulatedLosses2021-08-310605982312022-09-012023-08-310605982312021-09-012022-08-310605982322022-09-012023-08-310605982322021-09-012022-08-31060598232022-08-31060598232021-08-3106059823core:Goodwill2022-09-012023-08-3106059823core:FurnitureFittings2022-09-012023-08-3106059823core:UKTax2022-09-012023-08-3106059823core:UKTax2021-09-012022-08-3106059823core:Goodwill2022-08-3106059823core:Goodwill2023-08-3106059823core:Goodwill2022-08-3106059823core:FurnitureFittings2022-08-3106059823core:Non-currentFinancialInstruments2023-08-3106059823core:Non-currentFinancialInstruments2022-08-3106059823core:WithinOneYear2023-08-3106059823core:WithinOneYear2022-08-3106059823bus:PrivateLimitedCompanyLtd2022-09-012023-08-3106059823bus:FRS1022022-09-012023-08-3106059823bus:Audited2022-09-012023-08-3106059823bus:FullAccounts2022-09-012023-08-31xbrli:purexbrli:sharesiso4217:GBP