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Registration number: 08842584

GRS (Holdings) Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 31 December 2023

 

GRS (Holdings) Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 9

Consolidated Profit and Loss Account

10

Consolidated Balance Sheet

11

Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Statement of Changes in Equity

14

Consolidated Statement of Cash Flows

15

Notes to the Financial Statements

16 to 25

 

GRS (Holdings) Limited

Company Information

Directors

E S Russell

S M Whalley

Registered office

Suffolk House
Suffolk Road
Cheltenham
GL50 2ED

Auditors

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

GRS (Holdings) Limited

Strategic Report for the Year Ended 31 December 2023

The directors present their strategic report for the year ended 31 December 2023.

Principal activity

The principal activity of the group is that of a parent company. The principal activity of the group's subsidiary is the recognition and accreditation of international qualifications.

Fair review of the business

GRS (Holdings) continued, during the period under review, to provide a broad range of services in the international education sector. At its core was a high quality and comprehensive information service on international qualifications in order to meet the Government’s obligations and to support public policy.

Results for 2023 significantly exceeded expectations, with GRS (Holdings) group turnover for the reporting period of £38.3m (2022: £25.6m). This represented an increase of 50% in turnover year on year and was primarily due to higher transaction volumes. As international migration returned to pre-pandemic levels, demand for services increased. This was further accentuated by UK labour shortages post-Brexit and likewise the high number of displaced people coming to the UK, in particular from Hong Kong and Ukraine.

This trend however has not continued past Q1 2024 and transaction volumes have declined back closer to 2022 levels, reflecting changes to government policy on migration such as increases to thresholds within the Immigration Salary List.

GRS (Holdings) has also persisted with its strategy to diversify and broaden business streams, in particular internationally, and this has again prospered, with revenue from the Rest of World income up by 85% on 2022. This has arisen from a range of benchmarking, training, evaluation and consultancy work in the international education sector.

In order to continue to meet contractual commitments, it has been necessary for the Group to make substantial investments in people, technology and facilities to expand and strengthen operations.

Key performance indicators used by Management and the Board remain unchanged, including: the quality of the information provided to member organisations; the number and standard of services delivered to the public; customer experience and customer satisfaction rates; and the effective promotion of UK qualifications internationally. Metrics in these areas have been met and demonstrate the positive impact of the services that the company provides.

As the GRS Group is an Employee Ownership Trust, the organisation has continued to review its employee benefit schemes, improving conditions and flexibility to ensure it is in the position to upscale operations in a difficult recruitment market.

The Group’s vision remains to become the world’s leading provider of cross-border qualification and skill conversion services, a recognised supplier of information services to a global membership network and the organisation continues to capitalise on 27 years of professional experience to achieve this.

Strategic objectives and implementation plans are now focused on:

1. Effective management of existing Government contracts, including change management to reflect new contractual remits and responsibilities
2. Promotion of global migration management solutions and services
3. Expansion of international benchmarking and training activities
4. Quality benchmarking and accreditation globally
5. Evaluation and verification solutions for global migrants and professionals
6. Enhancing and expanding the global professional network of organisations handling international qualifications and skills

The Board recognises the critical importance of investing continuously both in the quality of information on qualifications and in the high quality of services to users. In particular, a substantial upturn in investment in technology is helping to transform the Group’s operations and services. This investment is intended to ensure the company is best placed to adapt to the post-pandemic era, and better equipped to adopt more process automation.

 

GRS (Holdings) Limited

Strategic Report for the Year Ended 31 December 2023

Principal risks and uncertainties

The management of the business and the execution of the Group’s strategy are subject to a number of risks and the principal risk relates to potential renewal of UK Government contracts. A procurement process was initiated post year end by the government which covered both of the company’s main contracts. A significant amount of resource has been focused on the renewal process, to position the company in the best possible way to continue in its current roles and the tender outcome result is expected by Q4 2024. The Group has also invested time in planning for a scenario in which the contracts are not renewed from 2025 onwards and is confident that its cash reserves together with its revenue diversification plans put it in a strong position for the future, regardless of the bid outcome.

Other risks continue to relate to the changes in the national and international political climate, particularly in relation to the educational sector, regulatory frameworks and global migration positions.

In its principal subsidiary, Ecctis remains compelled to implement an imposed pricing structure for its core business for the fixed term of operation. With a rising cost base, it remains important for the group to control its costs carefully and level of reserves to mitigate any changes imposed on the business.

Going concern

A significant level of the group’s business activities are in relation to two government contracts that, as noted above, are currently going through a procurement process. The group will continue servicing those contracts into the first half of 2025 and the directors have a reasonable expectation that they will be renewed. The group is in the process of growing and expanding on other business activities which will reduce the significance of the existing contracts and lessen any impact should they not be renewed in the future. The business has substantial resources available to it to implement changes that may be necessary to implement this strategy.

Based on the above, the Directors continue to have a reasonable expectation that the group and company is able to continue in operational existence for the foreseeable future and the company has continued to adopt the going concern basis in preparing its financial statements.

Approved by the Board on 14 August 2024 and signed on its behalf by:


S M Whalley
Director

 

GRS (Holdings) Limited

Directors' Report for the Year Ended 31 December 2023

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

Directors of the company

The directors who held office during the year were as follows:

M J Cartwright (resigned 30 September 2023)

P W W Norris (resigned 8 October 2023)

C Mathews (resigned 10 October 2023)

E S Russell (appointed 2 October 2023)

S M Whalley (appointed 2 October 2023)

T D Bewick (appointed 2 October 2023 and resigned 1 March 2024)

Financial instruments

The group's financial instruments comprise cash and liquid resources, and various other items such as trade debtors, trade creditors etc. that arise directly from its operations. The main purpose of these financial instruments is to finance the operations of the group.

The main risks arising from the group's financial instruments are set out below.

Price risk, credit risk, liquidity risk and cash flow risk

Credit risk:
The group’s principal financial assets are bank balances and cash and trade and other receivables. The company’s credit risk is primarily attributable to its trade receivables. The group's policies are aimed at minimising losses through monitoring appropriate payment history and satisfy credit worthiness procedures. The amounts presented in the balance sheet are, where appropriate, net of allowances for doubtful receivables. An allowance for impairment is made where there is an identified loss event which, based on previous experience, is evidence of a reduction in the recoverability of the cash flows. The credit risk on liquid funds is limited because the counter parties are banks with high credit-ratings assigned by international credit-rating agencies.

Liquidity risk:
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The group mitigates liquidity risk by managing cash generation from its operations, applying cash collection targets throughout the group and constantly monitors the company's trading results to ensure that the group can meet its future obligations as they fall due.

Cash flow risk:
Cash flow risk is the risk of exposure to variability in cash flows that is attributable to a particular risk associated with a recognised asset or liability such as future interest payments on a variable rate loans. The group is able to manage its cash flow through the generation of cash resources of its operational activities without the need for external debt and therefore this risk is mitigated.

 

GRS (Holdings) Limited

Directors' Report for the Year Ended 31 December 2023

Disclosure of information to the auditor

Each director has taken the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.

Approved by the Board on 14 August 2024 and signed on its behalf by:


S M Whalley
Director

 

GRS (Holdings) Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the Strategic Report, Directors' 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 group and company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and 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; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

GRS (Holdings) Limited

Independent Auditor's Report to the Members of GRS (Holdings) Limited

Opinion

We have audited the financial statements of GRS (Holdings) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023, which comprise the Consolidated Profit and Loss Account, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and 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 group's and the parent company's affairs as at 31 December 2023 and of the group's profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 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 original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinion on other matter 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

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

Matters on which we are required to report by exception

In the light of our 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 Directors' Report.

 

GRS (Holdings) Limited

Independent Auditor's Report to the Members of GRS (Holdings) Limited

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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

the parent company financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 6, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group’s and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor 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.

Extent to which the audit was capable of detecting irregularities, including fraud

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 considered the nature of the group’s industry and its control environment and reviewed the groups’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities.

We obtained an understanding of the legal and regulatory framework that the group operates in and identified the key laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements, including the UK Companies Act and tax legislation, and, those that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty.

We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgments made in accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.

In addition to the above, our procedures to respond to the risks identified included the following:

reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatements due to fraud;

enquiring of management concerning actual and potential litigation and claims and instances of non-compliance with laws and regulations; and

reading minutes of meetings of those charged with governance.

 

GRS (Holdings) Limited

Independent Auditor's Report to the Members of GRS (Holdings) Limited

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, 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, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed 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 are to become aware of it.

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

Use of our report

This report is made solely to the group’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 group’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 group and the group’s members as a body, for our audit work, for this report, or for the opinions we have formed.





Ryan Hancock (Senior Statutory Auditor)
For and on behalf of Hazlewoods LLP, Statutory Auditor

Staverton Court
Staverton
Cheltenham
GL51 0UX

14 August 2024

 

GRS (Holdings) Limited

Consolidated Profit and Loss Account for the Year Ended 31 December 2023

Note

2023
 £

2022
 £

Turnover

3

38,271,086

25,612,537

Cost of sales

 

(9,324,167)

(6,969,018)

Gross profit

 

28,946,919

18,643,519

Distribution costs

 

(911,230)

(739,597)

Administrative expenses - recurring

 

(4,778,141)

(2,473,889)

Administrative expenses - exceptional

4

-

(13,641,489)

Operating profit

5

23,257,548

1,788,544

Other interest receivable and similar income

6

745,052

143,995

Interest payable and similar charges

-

(3,554)

Profit before tax

 

24,002,600

1,928,985

Taxation

10

(5,724,349)

(377,359)

Profit for the financial year

 

18,278,251

1,551,626

The above results were derived from continuing operations.

The group has no other comprehensive income for the year.

 

GRS (Holdings) Limited

(Registration number: 08842584)
Consolidated Balance Sheet as at 31 December 2023

Note

2023
 £

2022
 £

Fixed assets

 

Tangible assets

11

609,460

538,144

Current assets

 

Debtors

13

1,406,147

1,989,269

Cash at bank and in hand

 

28,553,854

22,493,002

 

29,960,001

24,482,271

Creditors: Amounts falling due within one year

14

(5,654,708)

(18,375,375)

Net current assets

 

24,305,293

6,106,896

Total assets less current liabilities

 

24,914,753

6,645,040

Provisions for liabilities

10

(62,074)

(70,612)

Net assets

 

24,852,679

6,574,428

Capital and reserves

 

Called up share capital

16

100

100

Profit and loss account

24,852,579

6,574,328

Total equity

 

24,852,679

6,574,428

Approved and authorised by the Board on 14 August 2024 and signed on its behalf by:
 

S M Whalley
Director

 

GRS (Holdings) Limited

(Registration number: 08842584)
Balance Sheet as at 31 December 2023

Note

2023
 £

2022
 £

Fixed assets

 

Investments

12

1

1

Current assets

 

Debtors

13

86,126

86,974

Cash at bank and in hand

 

24,095

141,058

 

110,221

228,032

Creditors: Amounts falling due within one year

14

(135,250)

(241,011)

Net current liabilities

 

(25,029)

(12,979)

Net liabilities

 

(25,028)

(12,978)

Capital and reserves

 

Called up share capital

16

100

100

Profit and loss account

(25,128)

(13,078)

Total equity

 

(25,028)

(12,978)

The company made a loss after tax for the financial year of £12,050 (2022 - loss of £13,778).

Approved and authorised by the Board on 14 August 2024 and signed on its behalf by:
 

S M Whalley
Director

 

GRS (Holdings) Limited

Consolidated Statement of Changes in Equity for the Year Ended 31 December 2023
Equity attributable to the parent company

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2022

100

5,022,702

5,022,802

Profit for the year

-

1,551,626

1,551,626

At 31 December 2022

100

6,574,328

6,574,428

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2023

100

6,574,328

6,574,428

Profit for the year

-

18,278,251

18,278,251

At 31 December 2023

100

24,852,579

24,852,679

 

GRS (Holdings) Limited

Statement of Changes in Equity for the Year Ended 31 December 2023

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2022

100

700

800

Loss for the year

-

(13,778)

(13,778)

At 31 December 2022

100

(13,078)

(12,978)

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2023

100

(13,078)

(12,978)

Loss for the year

-

(12,050)

(12,050)

At 31 December 2023

100

(25,128)

(25,028)

 

GRS (Holdings) Limited

Consolidated Statement of Cash Flows for the Year Ended 31 December 2023

Note

2023
 £

2022
 £

Cash flows from operating activities

Profit for the year

 

18,278,251

1,551,626

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

227,002

150,434

Finance income

6

(745,052)

(143,995)

Finance costs

-

3,554

Income tax expense

10

5,724,349

377,359

 

23,484,550

1,938,978

Working capital adjustments

 

Increase in trade debtors

13

(214,409)

(354,559)

(Decrease)/increase in trade creditors

14

(12,744,257)

14,240,368

(Decrease)/increase in deferred income

 

(310,393)

526,167

Cash generated from operations

 

10,215,491

16,350,954

Income taxes paid

 

(4,601,373)

(2,381,791)

Net cash flow from operating activities

 

5,614,118

13,969,163

Cash flows from investing activities

 

Interest received

745,052

143,995

Acquisitions of tangible assets

(298,318)

(295,263)

Net cash flows from investing activities

 

446,734

(151,268)

Cash flows from financing activities

 

Interest paid

 

-

(3,554)

Net increase in cash and cash equivalents

 

6,060,852

13,814,341

Cash and cash equivalents at 1 January

 

22,493,002

8,678,661

Cash and cash equivalents at 31 December

 

28,553,854

22,493,002

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Suffolk House
Suffolk Road
Cheltenham
GL50 2ED

 

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Summary of disclosure exemptions

GRS (Holdings) Limited meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it in respect of its financial statements. Exemptions taken to presentation of a statement of cash flows.

Basis of consolidation

The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December 2023.

A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.

The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.

Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.

Going concern

A significant level of the group’s business activities are in relation to two ongoing contracts that are up for renewal in 2024. The group is expecting to continue servicing those contracts to the end of 2024 and the directors have a reasonable expectation that they will be renewed. The group is in the process of growing and expanding on other business activities which will reduce the significance of the existing contracts and lessen any impact should they not be renewed in the future. The business has substantial resources available to it to implement changes that may be necessary to implement this strategy.

Based on the above, the Directors continue to have a reasonable expectation that the group and company is able to continue in operational existence for the foreseeable future and the company has continued to adopt the going concern basis in preparing its financial statements.

Critical accounting 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 amounts 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
 

Judgements

No significant judgements have been made by management in preparing these financial statements.

Key sources of estimation uncertainty

No key sources of estimation uncertainty have been identified by management in preparing these financial statements other than those detailed in these accounting policies..

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the group’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the group.

The group recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the group's activities.

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating either to revenue or to assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.

Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.

Tangible assets

Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Furniture, fittings and equipment

25 - 33.3% straight line

Leasehold improvements

Over the life of the lease

Business combinations

Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquiisition date if the adjustment is probable and can be measured reliably.

Investments

Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the debtors.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the group’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

Financial Instruments

Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the group is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.
 

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Financial assets and liabilities are only offset in the balance sheet when, and only when, there exists a legally enforceable right to set off the recognised amounts and the group intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
 

Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

Non-financial assets:
An asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

Financial assets:
For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

 

3

Revenue

The analysis of the group's revenue for the year from continuing operations is as follows:


 2023
£


 2022
£

Rendering of services

38,271,086

25,612,537

The analysis of the group's turnover for the year by market is as follows:

2023
£


 2022
£

UK

13,421,368

12,200,599

Rest of world

24,849,718

13,411,938

38,271,086

25,612,537

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

4

Exceptional items - adjusting event after the financial period

2023
 £

2022
 £

Exceptional expenses

-

13,641,489

In performance of obligations under a contract to provide UK NARIC services between the Department for Education and Ecctis Limited, for the periods from 2014 until 2022, Ecctis Limited paid the Department for Education the sum of £13.6m.

 

5

Operating profit

Arrived at after charging/(crediting)

2023
 £

2022
 £

Depreciation expense

227,002

150,434

Foreign exchange losses/(gains)

2,025

(26,521)

Operating lease expense - property

187,650

141,741

 

6

Other interest receivable and similar income


 2023
£


 2022
£

Interest income

745,052

143,995

 

7

Staff costs

Group
The aggregate payroll costs (including directors' remuneration) were as follows:

2023
 £

2022
 £

Wages and salaries

8,026,702

6,104,654

Social security costs

730,665

677,444

Pension costs, defined contribution scheme

724,526

579,859

9,481,893

7,361,957

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

2023
 No.

2022
 No.

Administration and support

185

148

Company
The company incurred no staff costs and had no employees other than directors.

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

8

Directors' remuneration

The directors' remuneration for the year was as follows:


 2023
£


 2022
£

Remuneration

451,285

199,118

Contributions paid to money purchase schemes

40,131

22,131

491,416

221,249

During the year the number of directors who were receiving benefits and share incentives was as follows:


 2023
No.


 2022
No.

Accruing benefits under money purchase pension scheme

2

2

In respect of the highest paid director:

31 December
2023
£

31 December
2022
£

Remuneration

241,955

179,069

Company contributions to money purchase pension schemes

23,629

21,115

 

9

Auditors' remuneration


 2023
£


 2022
£

Audit of these financial statements

19,997

14,255

 

10

Taxation

Tax charged/(credited) in the consolidated profit and loss account

31 December
2023
£

31 December
2022
£

Current taxation

UK corporation tax

5,671,332

359,300

UK corporation tax adjustment to prior periods

(21,831)

12,788

5,649,501

372,088

Foreign tax

83,386

-

Total current income tax

5,732,887

372,088

Deferred taxation

Arising from origination and reversal of timing differences

(8,538)

5,271

Tax expense in the income statement

5,724,349

377,359

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

10

Taxation (continued)

The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2022 - higher than the standard rate of corporation tax in the UK) of 23.52% (2022 - 19%).

The differences are reconciled below:

31 December
2023
£

31 December
2022
£

Profit before tax

24,002,600

1,928,985

Corporation tax at standard rate

5,645,412

366,507

Effect of foreign tax rates

83,386

-

(Decrease)/increase in UK and foreign current tax from adjustment for prior periods

(21,831)

12,788

Tax decrease from effect of capital allowances and depreciation

-

(1,338)

Other tax effects for reconciliation between accounting profit and tax expense (income)

17,382

(598)

Total tax charge

5,724,349

377,359

The deferred tax liability at 31 December 2022 has been recognised at 25% (2021 - 25%).

Deferred tax

Group

2023

Liability
£

Difference between accumulated depreciation and capital allowances

77,188

Short term timing differences

(15,114)

62,074

2022

Liability
£

Difference between accumulated depreciation and capital allowances

70,612

70,612

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

11

Tangible assets

Group

Leasehold improvements
£

Furniture, fittings and equipment
 £

Total
£

Cost

At 1 January 2023

337,223

854,753

1,191,976

Additions

106,948

191,370

298,318

At 31 December 2023

444,171

1,046,123

1,490,294

Depreciation

At 1 January 2023

162,495

491,337

653,832

Charge for the year

60,389

166,613

227,002

At 31 December 2023

222,884

657,950

880,834

Carrying amount

At 31 December 2023

221,287

388,173

609,460

At 31 December 2022

174,728

363,416

538,144

 

12

Investments

Company

2023
£

2022
£

Investments in subsidiaries

1

1

Details of undertakings

Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

     

2023

2022

Ecctis Limited

Ordinary

100%

100%

 

England and Wales

     

The principal activity of Ecctis Limited is the recognition and accreditation of international qualifications.

 

13

Debtors

 

Group

Company

2023
 £

2022
 £

2023
 £

2022
 £

Trade debtors

665,810

703,452

-

-

Other debtors

433,996

363,194

86,126

86,974

Prepayments

306,341

125,092

-

-

Corporation tax asset

-

797,531

-

-

1,406,147

1,989,269

86,126

86,974

 

GRS (Holdings) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

14

Creditors

 

Group

Company

2023
 £

2022
 £

2023
 £

2022
 £

Due within one year

Trade creditors

398,794

45,631

-

-

Amounts due to related parties

-

-

130,000

236,310

Social security and other taxes

531,957

811,980

-

-

Other creditors

1,218

12,365

-

-

Accrued expenses

2,061,851

14,868,101

5,250

4,701

Corporation tax liability

333,983

-

-

-

Deferred income

2,326,905

2,637,298

-

-

5,654,708

18,375,375

135,250

241,011

 

15

Pension and other schemes

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £724,526 (2022 - £579,859).

 

16

Share capital

Allotted, called up and fully paid shares

 

2023

2022

 

No.

£

No.

£

Ordinary of £1 each

100

100

100

100

         
 

17

Obligations under operating leases

Group

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

145,000

175,000

Later than one year and not later than five years

70,000

200,000

215,000

375,000

The amount of non-cancellable operating lease payments recognised as an expense during the year was £232,650 (2022 - £218,048).

 

18

Control

The ultimate controlling party is GRS (Holdings) Limited Employee Ownership Trust.