REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 AUGUST 2023 |
FOR |
FRANKLIN COVEY EUROPE LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 AUGUST 2023 |
FOR |
FRANKLIN COVEY EUROPE LIMITED |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
CONTENTS OF THE FINANCIAL STATEMENTS |
for the year ended 31 August 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Income Statement | 9 |
Other Comprehensive Income | 10 |
Balance Sheet | 11 |
Statement of Changes in Equity | 12 |
Cash Flow Statement | 13 |
Notes to the Cash Flow Statement | 14 |
Notes to the Financial Statements | 15 |
FRANKLIN COVEY EUROPE LIMITED |
COMPANY INFORMATION |
for the year ended 31 August 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: |
AUDITORS: |
Chartered Accountants and Statutory Auditor |
Highdown House |
11 Highdown Road |
Leamington Spa |
Warwickshire |
CV31 1XT |
BANKERS: |
32 Bridge Street |
Banbury |
Oxfordshire |
OX16 5PN |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
STRATEGIC REPORT |
for the year ended 31 August 2023 |
The directors present their strategic report for the year ended 31 August 2023. |
REVIEW OF BUSINESS |
The company forms part of the global organisation FranklinCovey Co, a NYSE listed company headquartered in Utah, USA. It is the sole licensed distributor for the UK and Ireland markets for its training and consultancy business whereby it specialises in the performance improvement helping organisations achieve results that require a change in human behaviour. |
The business conducted is principally the running of training programmes within organisations and public sector bodies utilising its own team of consultants or by the selling of its intellectual property within training materials and licensing. |
The company also supports some functions on behalf of its parent FranklinCovey Co, to which it recharges these services back including an additional management fee. |
PRINCIPAL RISKS AND UNCERTAINTIES |
The company being part of a global organisation owned by FranklinCovey Co, shares several risks and uncertainties that its parent experiences. |
The company operates in a competitive industry and our competitors may develop courses that adversely affect our ability to sell our offerings. |
Economic and political conditions and the effects of these conditions could adversely affect our clients' businesses and their levels of activity with the company. |
The results of operations may be negatively affected if we cannot continue to expand or develop our services and solutions in response to client demands. |
The ability for the company to continue with its growth projections could be impacted if we were unable to attract, retain, and motivate high quality employees including training consultants and experienced sales personnel with the skills required to compete effectively. |
Our business could be adversely affected if our clients are not satisfied with the quality and provision of our services. |
RESULTS AND PERFORMANCE |
The results of the company as set out in these accounts shows a small increase in revenue of around 7% to £9.3 million (2022: £8.7 million) with a pre-tax reported profit of £559K (2022: £488K profit). |
Within its core training business (excluding support services to its parent or to its subsidiary companies) revenue experienced an overall increase of around 2.5%, with pre-tax profit of £495K from a prior year profit of around £390K. |
We are extremely pleased by our revenue and Adjusted EBITDA growth and the business's momentum. These results reflect the tremendous power of our continued focus on the business priorities that have continued to drive our efforts and results over the years. |
We anticipate our subscription business to continue to achieve significant top and bottom-line growth in fiscal 2024 and well into the future, as substantially all our business becomes subscription and subscription services over the next few years. As this occurs, we expect to: (a) achieve accelerated growth in revenue, Adjusted EBITDA, and cash flow; (b) substantially increase our number of clients - clients who go on to become ''clients for life;'' and (c) ensure that FranklinCovey makes accelerated progress toward its goal of being ''the workplace of choice for achievers with heart.'' |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
STRATEGIC REPORT |
for the year ended 31 August 2023 |
BUSINESS ENVIRONMENT |
Although the country continues to experience relatively flat economic growth, the market conditions for the company's training services continue to improve, helped by the company continuing to focus on client organisational outcomes rather than the selling of training programmes. Organisations within both public and private sectors seem to be more open to invest within their employee base particularly in improving their skills and expertise. This has been not only in traditional vocational training but also in the softer behaviour skills that the company's services provide. |
STRATEGY |
The main strategy of the company is to market its services and offerings to the business community in which to secure new clients, whilst also retaining and building upon existing relationships. Its main go-to market strategy is the holding of public, free events showcasing a specific curriculum and presenting the business case for clients. These events allow potential clients to evaluate both the investment level and the respective success to their organisation. |
With the support of its parent, FranklinCovey Co., the company also continues to build upon its current portfolio of services and training solutions available to its client base within the UK and Ireland. In the forthcoming year the company intends on continuing to invest significantly within its subscription service channel where we enable organisations to economically and flexibly access numerous training solutions enabling individuals and organisations to achieve results that require lasting changes in human behaviour. |
KEY PERFORMANCE INDICATORS |
We have continued to make progress throughout the year in relation to the key elements of our strategy. The following are key indicators which the company monitors in which to measure progress: |
Pipeline Addition - to increase the value of additional opportunities to the sales pipeline across the whole business each week. |
Face-To-Face CP Hours - to increase the quantity of face-to-face hours the client partners (sales team) spend with clients each week. |
New Subscription Logos - to acquire new clients with a subscription model contract. |
Subscriptions Passholders - to increase the level of active subscription users able to access the company's training content. |
Subscription Revenue Renewal - to maintain the level of subscription client revenue being renewed. |
Delivery Quality Results - to improve the net promoter score (NPS) of training delegates attending the company's programmes. |
ON BEHALF OF THE BOARD: |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
REPORT OF THE DIRECTORS |
for the year ended 31 August 2023 |
The directors present their report with the financial statements of the company for the year ended 31 August 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of a provider of learning and performance solutions for professionals and organisations. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 August 2023. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 September 2022 to the date of this report. |
DISCLOSURE IN THE STRATEGIC REPORT |
Information on the company's review of the business, principal risks and uncertainties and future developments is not shown in the directors' report as it is shown in the strategic report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
REPORT OF THE DIRECTORS |
for the year ended 31 August 2023 |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
FRANKLIN COVEY EUROPE LIMITED |
Opinion |
We have audited the financial statements of Franklin Covey Europe Limited (the 'company') for the year ended 31 August 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 August 2023 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
FRANKLIN COVEY EUROPE LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of 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 four, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so. |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
The audit process includes an assessment of the entity's risk environment, through enquiry of and discussion with management, including an assessment of any key laws and regulations with which the company must comply in the ordinary course of its business. |
Additionally, the overall risks of irregular transactions occurring are assessed following our observations and confirmation of the design and implementation of management's controls. Whilst we are mindful of these risks, our audit focus is geared towards the risk of material misstatement in the financial statements as a whole. |
As such, our procedures cannot guarantee that all transactions have been fully compliant with all relevant laws and regulations, including those regulations relating to fraud, as our procedures are not designed to detect all instances of non-compliance. By definition, the risk of our detection of non-compliance is greater where compliance with a law or regulation is removed from the events and transactions reflected in the financial statements. The risk is also greater regarding irregularities due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
FRANKLIN COVEY EUROPE LIMITED |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Chartered Accountants and Statutory Auditor |
Highdown House |
11 Highdown Road |
Leamington Spa |
Warwickshire |
CV31 1XT |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
INCOME STATEMENT |
for the year ended 31 August 2023 |
2023 | 2022 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
OPERATING PROFIT | 5 |
Interest receivable and similar income |
634,830 | 510,427 |
Interest payable and similar expenses | 6 |
PROFIT BEFORE TAXATION |
Tax on profit | 7 |
PROFIT FOR THE FINANCIAL YEAR |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
OTHER COMPREHENSIVE INCOME |
for the year ended 31 August 2023 |
2023 | 2022 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
BALANCE SHEET |
31 August 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 8 |
Tangible assets | 9 |
Investments | 10 |
CURRENT ASSETS |
Stocks | 11 |
Debtors | 12 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year | 14 | ( |
) | ( |
) |
PROVISIONS FOR LIABILITIES | 16 | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 17 |
Retained earnings | 18 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
STATEMENT OF CHANGES IN EQUITY |
for the year ended 31 August 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 September 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 August 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 August 2023 |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
CASH FLOW STATEMENT |
for the year ended 31 August 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Interest paid | ( |
) | ( |
) |
Tax paid | ( |
) |
Taxation refund |
Net cash from operating activities | ( |
) |
Cash flows from investing activities |
Purchase of intangible fixed assets | ( |
) |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
(Decrease)/increase in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
709,520 |
Cash and cash equivalents at end of year | 2 | 1,339,950 | 1,759,976 |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE CASH FLOW STATEMENT |
for the year ended 31 August 2023 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
£ | £ |
Profit before taxation |
Depreciation charges |
Finance costs |
Finance income | - | (97 | ) |
699,923 | 573,618 |
(Increase)/decrease in stocks | ( |
) |
Decrease/(increase) in trade and other debtors | ( |
) |
(Decrease)/increase in trade and other creditors | ( |
) |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 August 2023 |
31.8.23 | 1.9.22 |
£ | £ |
Cash and cash equivalents | 1,339,950 | 1,759,976 |
Year ended 31 August 2022 |
31.8.22 | 1.9.21 |
£ | £ |
Cash and cash equivalents | 1,759,976 | 709,520 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.9.22 | Cash flow | At 31.8.23 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 1,759,976 | (420,026 | ) | 1,339,950 |
1,759,976 | ( |
) | 1,339,950 |
Total | 1,759,976 | (420,026 | ) | 1,339,950 |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS |
for the year ended 31 August 2023 |
1. | STATUTORY INFORMATION |
Franklin Covey Europe Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The accounts have been prepared in accordance with applicable accounting standards. The principal accounting policies adopted in the preparation of the financial statements are set out below and remain consistent with the prior year. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of paragraphs 26.18(b), 26.19 to 26.21 and 26.23. |
This information is included in the consolidated financial statements of Franklin Covey Co Inc. as at 31 August 2023 and these financial statement may be obtained from 2200 West Parkway Boulevard, Salt Lake City, Utah 84119, USA. |
Preparation of consolidated financial statements |
The financial statements contain information about Franklin Covey Europe Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 401 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertaking are included by full consolidation in the consolidated financial statements of its parent, Franklin Covey Co Inc, 2200 West Parkway Boulevard, Salt Lake City, Utah 84119, USA. |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
2. | ACCOUNTING POLICIES - continued |
Critical accounting judgements and key sources of estimation uncertainty |
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. |
Accounting estimates: |
i) Inventory provisioning |
The company holds training and course materials which can become out of date or else superseded. When calculating the inventory provision, management consider both the historic movement of individual lines and their expected usage in future accounting periods when determining the associated provisioning required. See note 11 for the net carrying amount of inventory and associated impact of the changes in the impairment provision in the year. |
ii) Impairment of debtors |
The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. See note 12 for the net carrying amount of the debtors and associated impairment provision. |
Turnover |
Turnover from the sale of goods and services is recognised when significant risks and rewards of ownership of the goods or benefits of the service have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on despatch of the goods, or delivery of the service. |
Where subscription and similar income is invoiced in advance, income is initially deferred and released to the income statement over the period to which the underlying agreement relates. |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Computer software will be amortised evenly over an estimated useful life of 5 years, once it has come fully into use. |
Tangible fixed assets |
Leasehold improvements | - |
Fixtures and fittings | - |
Computer equipment | - |
Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended. |
Investments in subsidiaries |
Investments in subsidiary undertakings are recognised at cost, less impairment. |
Stocks |
Stocks are valued at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase and other costs incurred in bringing stock to its present location and condition. |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently, financial instruments are measured at amortised cost using the effective interest rate method, less impairment. |
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the income statement. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Share based payments |
Incentives in the form of shares are provided to certain employees of Franklin Covey Europe Limited under share option and share award schemes that are established by the ultimate parent company Franklin Covey Co Inc. As the scheme is administered by a fellow group company with stock issues being made from the parent company the costs of the awards and the issues of any shares are accounted for in the financial statements of Franklin Covey Co Inc. |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
2023 | 2022 |
£ | £ |
United Kingdom |
Europe |
Rest of the World | 272,336 | 642,498 |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Sales | 22 | 22 |
Consultants | 7 | 5 |
Administration | 20 | 19 |
2023 | 2022 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2023 | 2022 |
£ | £ |
Other operating leases |
Depreciation - owned assets |
Auditors' remuneration |
Taxation compliance services |
Operating leases - other |
Operating leases - land and buildings |
Foreign exchange differences | ( |
) |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Other interest |
7. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax |
Tax on profit |
UK corporation tax has been charged at 25% . |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
7. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2022 - |
Effects of: |
Expenses not deductible for tax purposes | ( |
) |
Capital allowances in excess of depreciation | ( |
) | - |
Depreciation in excess of capital allowances | - |
Other tax adjustments | ( |
) | (8,345 | ) |
Total tax charge | 110,457 | 104,930 |
From April 2023 the UK corporation tax rate increased from 19% to 25% and is set to remain at 25% for the foreseeable future. |
8. | INTANGIBLE FIXED ASSETS |
Computer |
software |
£ |
COST |
Additions |
Reclassification/transfer |
At 31 August 2023 |
NET BOOK VALUE |
At 31 August 2023 |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
9. | TANGIBLE FIXED ASSETS |
Fixtures |
Leasehold | and | Computer |
improvements | fittings | equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 September 2022 |
Additions |
Disposals | ( |
) | ( |
) | ( |
) |
Reclassification/transfer | ( |
) | ( |
) |
At 31 August 2023 |
DEPRECIATION |
At 1 September 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) | ( |
) |
At 31 August 2023 |
NET BOOK VALUE |
At 31 August 2023 |
At 31 August 2022 |
10. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertaking |
£ |
COST |
At 1 September 2022 |
and 31 August 2023 |
NET BOOK VALUE |
At 31 August 2023 |
At 31 August 2022 |
Franklin Covey Europe Limited own 100% of the share capital of Franklin Covey Germany GmbH and Franklin Covey Leadership Limited, registered in Ireland. Franklin Covey Germany GmbH owns 100% of the share capital of Franklin Covey Switzerland GmbH and Franklin Covey Austria GmbH. |
11. | STOCKS |
2023 | 2022 |
£ | £ |
Stocks |
A reversal of an impairment loss of £40,998 (2022: impairment loss of £23,008) was recognised in cost of sales against stock during the year. |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
12. | DEBTORS |
2023 | 2022 |
£ | £ |
Amounts falling due within one year: |
Trade debtors |
Amounts owed by group undertakings |
Tax |
Deferred tax asset |
Prepayments |
Amounts falling due after more than one year: |
Amounts owed by group undertakings |
Aggregate amounts |
Deferred tax asset |
2022 |
£ |
Accelerated capital allowances | (18,680 | ) |
Tax losses | 9,741 |
Other timing differences | 17,379 |
An impairment loss of £120 (2022: £62,254) was recognised against trade debtors during the year. |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade creditors |
Tax |
Social security and other taxes |
VAT | 250,758 | 296,558 |
Accruals and deferred income |
14. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2023 | 2022 |
£ | £ |
Amounts owed to group undertakings |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
15. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
16. | PROVISIONS FOR LIABILITIES |
2023 |
£ |
Deferred tax |
Accelerated capital allowances | 90,629 |
Other timing differences | (16,824 | ) |
73,805 |
Deferred |
tax |
£ |
Balance at 1 September 2022 | ( |
) |
Charge to Income Statement during year |
Balance at 31 August 2023 |
17. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary | £1 | 2 | 2 |
All ordinary shares rank pari passu with respect to voting rights, the rights to distribution of dividends and the repayment of capital. |
FRANKLIN COVEY EUROPE LIMITED (REGISTERED NUMBER: 03282374) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
for the year ended 31 August 2023 |
18. | RESERVES |
Retained |
earnings |
£ |
At 1 September 2022 |
Profit for the year |
At 31 August 2023 |
Retained earnings |
This reserve represents all current and prior period retained profits and losses. |
19. | PENSION COMMITMENTS |
The company operates a defined contribution pension scheme. The scheme and its assets are held by independent managers. The pension charge represents contributions due from the company and amounted to £135,509 (2022 - £119,093). Included within creditors is a balance due to pension providers of £nil (2022 - £21,858). |
20. | ULTIMATE PARENT COMPANY |
Franklin Covey Co Inc (incorporated in USA ) is regarded by the directors as being the company's ultimate parent company. |
21. | CONTINGENT LIABILITIES |
The company has given a guarantee to HM Revenue and Customs for an amount up to £8,000 (2022 - £8,000). |
22. | RELATED PARTY DISCLOSURES |
Key management are considered to be the directors, whose remuneration is disclosed in the preceding notes to these financial statements. |
23. | SHARE-BASED PAYMENT TRANSACTIONS |
The ultimate parent company Franklin Covey Co Inc, administers the Franklin Covey Equity Compensation Plan as part of its long-term incentive compensation programme. Under the plan, the ultimate parent company has issued restricted stock units to certain employees of the company. |
Full details of the Franklin Covey Equity Compensation Plan are available in the published accounts of the ultimate parent company. |
24. | CONTROLLING INTERESTS |
Franklin Covey Europe Limited is a wholly owned Subsidiary of Franklin Covey Co Inc, a company incorporated in the USA. The group financial statements are available to the public from the registered office at: |
2200 West Parkway Boulevard |
Salt Lake City |
Utah 84119 |
USA |