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Registered number: 11629407










Kingsheath Construction Limited










Annual report and financial statements

For the year ended 30 November 2023

 
Kingsheath Construction Limited
 

Company Information


Directors
J A Pike 
M Jeffery 
M Berry 
L J Reilly 
S Shine 




Registered number
11629407



Registered office
Barton House
The Street

Bredhurst

Gillingham

Kent

ME7 3LQ




Independent auditors
Kreston Reeves LLP
Chartered Accountants & Statutory Auditor

37 St Margaret's Street

Canterbury

Kent

CT1 2TU





 
Kingsheath Construction Limited
 

Contents



Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditors' report
5 - 8
Statement of income and retained earnings
9
Balance sheet
10
Statement of changes in equity
11 - 12
Statement of cash flows
13
Notes to the financial statements
14 - 25


 
Kingsheath Construction Limited
 

Strategic report
For the year ended 30 November 2023

Introduction
 
The directors present their Strategic Report for the year ended 30 November 2023. 

Business review
 
The company is a leading construction contractor in Kent & Essex specialising in groundworks, civil engineering and reinforced  concrete  frames.  The  principal  activities  of  the  company  include  a  range  of  construction services.  These  contracts  are  primarily  held  with  large  national  residential  property  developers building new housing projects.
During the year, the company benefited from several major new contracts which resulted in higher revenue levels as well as retaining and retains a healthy pipeline of work for the next three years.
As shown in the company's statement of income and retained earnings on page 9, the company's turnover increased by 28.1% compared to the previous year which has resulted in a profit before tax of £1,158,009. The directors anticipate a similar level of revenue and improved profitability over the next 12 months.
The statement of financial position on page 10 of the financial statements shows an increase in net assets to a value of £2,876,842 and the balance sheet remains healthy and solvent.

Principal risks and uncertainties
 
The interest rates remaining at its current levels have reduced Sales rates for the majority of our clients, build release have reduced significantly resulting in a slow down of programmes across the board. These factors impacting the supply chain have led to a fall in gross margins.
After the year end the risk has been reduced to the extent that the higher costs are now being budgeted for in new contracts.
The company's recent growth has enabled it to achieve greater buying power, something which is also enjoyed by a number of the company's larger competitors, removing some of the previous risk.
Careful cash management continues to be vital as the company grows and this is monitored carefully with monthly forecasting and regular discussions with finance providers.
 
Interest rate risk
 
The company has no current bank borrowings. However, it does use financing to purchase its equipment and is therefore mindful of rates available and potentially higher charges. The directors regularly review the best rates available when considering finance options.
 
Liquidity and cash flow risk
 
The company manages its liquidity risk by structuring their borrowings to ensure repayments are made over a suitable period. Cash flow risk is managed through daily monitoring of working capital requirements, ensuring supply chain payment terms mirrors our clients.
 
Financial risk management, objectives and policies 
 
There are no matters concerning financial risk which are material for the assessment of the assets, liabilities, finance position and profit or loss of the company. 

Page 1

 
Kingsheath Construction Limited
 

Strategic report (continued)
For the year ended 30 November 2023

Financial key performance indicators
 
Key performance indicators are used to measure the company's performance. The directors consider the key measures of the company's performance to be revenue and gross profit margin.
The directors believe that a gross profit margin of 12-15% should be achievable. This aim has been affected by the key risks faced covered previously.

Going concern
 
The business retains sufficient reserves and cash to manage periodic slow downs and therefore there are no foreseeable reasons why the company should not prepare the financial statements on a going concern basis.
 
Future developments
 
The overall business outlook remains positive; the directors are experienced in the construction business and well aware of the challenges the sector faces. The company continues to invest in innovative solutions and to win long term projects thanks to many repeat clients that regularly provide new opportunities for work. Our current core market remains stable with signs of positivity and growth. We have new clients for 2024 that are operating in the affordable housing market to counteract the current slow down in the private sector. We have a resilient balance sheet, underpinned by continued investment in plant, equipment and staff, which positions the business for further growth in 2024 and beyond.
The management team are also continually seeking new ways to grow the business including the creation of new services in the coming year such as the customer care and new snagging department.
Our pipeline business for the next 12 months looks very positive with over £50m to be added to our current order book value of £50m.


This report was approved by the board on 29 August 2024 and signed on its behalf.



J A Pike
Director

Page 2

 
Kingsheath Construction Limited
 

 
Directors' report
For the year ended 30 November 2023

The directors present their report and the financial statements for the year ended 30 November 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic report, the 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

make judgments 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £1,092,148 (2022 - £889,135).

Dividends were declared and paid of £734,640 during the year (2022 - £453,300). 

Directors

The directors who served during the year were:

J A Pike 
M Jeffery 
M Berry 
L J Reilly 
S Shine 

Research and development activities

Kingsheath Construction provides Research and Development activities in a number of specialists areas. This includes the exploring of alternative material solutions, adaptations of the Hydraulically Bound material process and advancing the topsoil process; ultimately with the view to provide creative solutions beyond existing industry practices. 

Page 3

 
Kingsheath Construction Limited
 

 
Directors' report (continued)
For the year ended 30 November 2023

Matters covered in the Strategic report

The company has chosen in accordance with Section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 to set out within the Company's Strategic Report Information Required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulation 2008. This includes information that would have been included in the business review, going concern, principal risks and uncertainties and future developments. 

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditorsKreston Reeves LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 29 August 2024 and signed on its behalf.
 





J A Pike
Director

Page 4

 
Kingsheath Construction Limited
 

 
Independent auditors' report to the members of Kingsheath Construction Limited
 

Opinion


We have audited the financial statements of Kingsheath Construction Limited (the 'Company') for the year ended 30 November 2023, which comprise the Statement of income and retained earnings, the Balance sheet, the Statement of cash flows, the Statement of changes in equity and the related notes, including a summary of significant accounting policiesThe 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 30 November 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 United Kingdom, including the Financial Reporting Council'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 other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Page 5

 
Kingsheath Construction Limited
 

 
Independent auditors' report to the members of Kingsheath Construction Limited (continued)


Opinion 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 Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic report and the 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 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 Directors' report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


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 Directors' responsibilities statement set out on page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


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


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 an Auditors' 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:

Capability of the audit in detecting irregularities, including fraud
The objectives of our audit are to identify and assess the risks of material misstatement of the financial statements due to fraud or error; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud or error; and to respond appropriately to those risks.
 
Page 6

 
Kingsheath Construction Limited
 

 
Independent auditors' report to the members of Kingsheath Construction Limited (continued)


Based on our understanding of the company and industry, and through discussion with the directors and other management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery and employment law. We considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, taxation and pension legislation. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls),and determined that the principal risks were related to management override. Audit procedures performed by the engagement team: 
 
Detailed discussions were held with management to identify any known or suspected instances of non-compliance with laws and regulations; and
Assessment of identified fraud risk factors; and
The engagement team were made aware of the identified laws and regulations to ensure they remained alert to any indications of non-compliance throughout their audit procedures; and
Performing analytical procedures to identify unusual or unexpected relationships that may indicate risk of material misstatement due to fraud; and
Confirmation of related parties with management, and review of transactions throughout the period to identify any previously undisclosed transactions with related parties outside the normal course of business; and
Identifying and testing journal entries, in particular any manual entries made at the year end for financial statement preparation.

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, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.


As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:


Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditors' report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditors' report. However, future events or conditions may cause the Company to cease to continue as a going concern.
 
Page 7

 
Kingsheath Construction Limited
 

 
Independent auditors' report to the members of Kingsheath Construction Limited (continued)


Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.


We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.


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 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Robert Sellers FCCA (Senior Statutory Auditor)
  
for and on behalf of
Kreston Reeves LLP
 
Chartered Accountants
Statutory Auditor
  
37 St Margaret's Street
Canterbury
Kent
CT1 2TU

30 August 2024
Page 8

 
Kingsheath Construction Limited
 

Statement of income and retained earnings
For the year ended 30 November 2023

2023
2022
Note
£
£

  

Turnover
 4 
48,140,485
37,576,560

Cost of sales
  
(44,521,609)
(34,897,524)

Gross profit
  
3,618,876
2,679,036

Distribution costs
  
(10,791)
(11,360)

Administrative expenses
  
(2,438,758)
(1,774,980)

Operating profit
 5 
1,169,327
892,696

Interest receivable and similar income
  
3,603
2,823

Interest payable and similar expenses
  
(14,921)
(6,384)

Profit before tax
  
1,158,009
889,135

Tax on profit
 9 
(65,861)
-

Profit after tax
  
1,092,148
889,135

  

  

Retained earnings at the beginning of the year
  
1,919,331
1,483,496

  
1,919,331
1,483,496

Profit for the year
  
1,092,148
889,135

Dividends declared and paid
  
(734,640)
(453,300)

Retained earnings at the end of the year
  
2,276,839
1,919,331

The notes on pages 14 to 25 form part of these financial statements.

Page 9

 
Kingsheath Construction Limited
Registered number: 11629407

Balance sheet
As at 30 November 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible fixed assets
 10 
425,428
253,480

  
425,428
253,480

Current assets
  

Debtors: amounts falling due after more than one year
 11 
89,781
137,724

Debtors: amounts falling due within one year
 11 
11,125,670
8,329,312

Bank and cash balances
  
2,326,604
787,140

  
13,542,055
9,254,176

Creditors: amounts falling due within one year
 12 
(10,892,237)
(6,857,353)

Net current assets
  
 
 
2,649,818
 
 
2,396,823

Total assets less current liabilities
  
3,075,246
2,650,303

Creditors: amounts falling due after more than one year
 13 
(198,404)
(130,969)

  

Net assets
  
2,876,842
2,519,334


Capital and reserves
  

Called up share capital 
 14 
300,003
300,003

Share premium account
 15 
300,000
300,000

Profit and loss account
 15 
2,276,839
1,919,331

  
2,876,842
2,519,334


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 29 August 2024.




J A Pike
Director

The notes on pages 14 to 25 form part of these financial statements.

Page 10

 
Kingsheath Construction Limited
 

Statement of changes in equity
For the year ended 30 November 2023


Called up share capital
Share premium account
Profit and loss account
Total equity

£
£
£
£

At 1 December 2022
300,003
300,000
1,919,331
2,519,334


Comprehensive income for the year

Profit for the year

-
-
1,092,148
1,092,148


Other comprehensive income for the year
-
-
-
-


Total comprehensive income for the year
-
-
1,092,148
1,092,148


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(734,640)
(734,640)


Total transactions with owners
-
-
(734,640)
(734,640)


At 30 November 2023
300,003
300,000
2,276,839
2,876,842


The notes on pages 14 to 25 form part of these financial statements.

Page 11

 
Kingsheath Construction Limited
 

Statement of changes in equity
For the year ended 30 November 2022


Called up share capital
Share premium account
Profit and loss account
Total equity

£
£
£
£

At 1 December 2021
300,003
300,000
1,483,496
2,083,499


Comprehensive income for the year

Profit for the year

-
-
889,135
889,135


Other comprehensive income for the year
-
-
-
-


Total comprehensive income for the year
-
-
889,135
889,135


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(453,300)
(453,300)


Total transactions with owners
-
-
(453,300)
(453,300)


At 30 November 2022
300,003
300,000
1,919,331
2,519,334


The notes on pages 14 to 25 form part of these financial statements.

Page 12

 
Kingsheath Construction Limited
 

Statement of cash flows
For the year ended 30 November 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
1,092,148
889,135

Adjustments for:

Depreciation of tangible assets
117,440
67,658

Interest paid
14,921
6,384

Interest received
(3,603)
(2,823)

Taxation charge
65,861
-

(Increase) in debtors
(2,748,415)
(2,495,748)

Increase in creditors
3,914,020
1,738,909

Net cash generated from operating activities

2,452,372
203,515


Cash flows from investing activities

Purchase of tangible fixed assets
(289,388)
(169,295)

Interest received
3,603
2,823

HP interest paid
(14,921)
(6,384)

Net cash from investing activities

(300,706)
(172,856)

Cash flows from financing activities

Repayment of loans
-
(200,000)

Repayment of/new finance leases
122,439
79,318

Dividends paid
(734,640)
(453,300)

Net cash used in financing activities
(612,201)
(573,982)

Net increase/(decrease) in cash and cash equivalents
1,539,465
(543,323)

Cash and cash equivalents at beginning of year
787,139
1,330,463

Cash and cash equivalents at the end of year
2,326,604
787,140


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
2,326,604
787,140

2,326,604
787,140


Page 13

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

1.


General information

Kingsheath Construction Limited is a private company limited by shares incorporated in England and Wales. The address of the registered office and registered number are disclosed on the company information page. The address of the principal place of business is Barton's Court, The Street, Bredhurst, ME7 3LQ.
The company's functional and presentational currency is GBP and is rounded to the nearest £.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006

The following principal accounting policies have been applied:

 
2.2

Going concern

The directors annually assess whether there are conditions or events, when considered in aggregate, that raise substantial doubt about the ability of the company to continue as a going concern and meets its obligations as they become due. This evaluation is based on relevant market conditions and events, alongside company projections that the directors consider to be reasonable and achievable in light of the company's actual results and the anticipated future revenues from both existing and prospective contracts. 
As a result of this evaluation through to the date of signing the accounts the directors have no concerns over the company's ability to continue to trade and the financial statements have been prepared as a going concern. 

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 14

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

2.Accounting policies (continued)

 
2.4

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

The Company has taken advantage of the optional exemption available on transition to FRS 102 which allows lease incentives on leases entered into before the date of transition to the standard 01 December 2021 to continue to be charged over the period to the first market rent review rather than the term of the lease.

 
2.5

Research and development

Research and development work is recognised as an expense, given the nature of the work. 

 
2.6

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.8

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.

 
2.9

Taxation

Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

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

 
2.10

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Page 15

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

2.Accounting policies (continued)


2.10
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Plant and machinery
-
33%
Motor vehicles
-
25-33%
Office equipment
-
33%
Computer equipment
-
33%

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.12

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.13

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.14

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” 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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried
Page 16

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

2.Accounting policies (continued)


2.14
Financial instruments (continued)

at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

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

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

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

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
 

Page 17

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

2.Accounting policies (continued)


2.14
Financial instruments (continued)

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

 
2.15

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In applying the company's accounting policies, the directors are required to make judgements, estimates and assumptions in determining the carrying amounts of assets and liabilities. The directors' judgements, estimates and assumptions are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions, the actual results and outcomes may differ. 
The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the year in which the estimate is revised, if the revision affects only that year or in the year of the revision and future years, if the revision affects both current and future years. 
 
Tangible Fixed Assets
 
The company has recognised tangible fixed assets with a carrying value of £425,427 at the reporting date (see note 10). These assets are stated at their cost less provision for depreciation and impairment. The company's accounting policy sets out the approach to calculating depreciation for immaterial assets acquired. For material assets the company determines at acquisition reliable estimates for the useful life of the asset, its residual value and decommissioning costs. These estimates are based upon such factors as the expected use of the acquired asset and market conditions. At subsequent reporting dates the directors consider whether there are any factors such as technological advancements or changes in market conditions that indicate a need to reconsider the estimates used. 
Where there are indicators that the carrying value of tangible assets may be impaired the company undertakes tests to determine the recoverable amount of assets. These tests require estimates of the fair value of assets less cost to sell and of their value in use. Wherever possible the estimate of the fair value of assets is based upon observable market prices less incremental cost for disposing of the asset. The value in use calculation is based upon a discounted cash flow model, based upon the company's forecasts for the foreseeable future which do not include any restructuring activities that the company is not yet committed to or significant future investments that will enhance the asset's performance. The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well as expected future cash flows and the growth rate used for extrapolation purposes. 
 
Long Term Contracts
 
The company classifies as long term those contracts which relate to a project where the contract activity extends over more than one accounting period. 
The amount recognised as turnover represents the value of work carried out during the period where the outcome can be assessed with reasonable certainty, attributable profit is recognised in proportion to the amount of turnover recognised in the accounts. Full provision is made for any foreseeable losses. Amounts recoverable on long term contracts, which are included in debtors, are stated at the net sales value of work done after provision for contingencies and anticipated future losses on contracts, less
Page 18

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

3.Judgments in applying accounting policies (continued)

amounts received as progress payments on account. Excess payments are included in creditors as payments on account. 


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Groundworks services
48,140,485
37,576,560

48,140,485
37,576,560


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
48,140,485
37,576,560

48,140,485
37,576,560



5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
117,440
67,658

Other operating lease rentals
76,945
27,778


6.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
18,000
15,000
Page 19

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

7.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
1,000,945
729,018

Social security costs
111,052
95,387

Cost of defined contribution scheme
20,259
16,533

1,132,256
840,938


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Head office
16
13



Other staff
4
4

20
17


8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
110,253
97,062

110,253
97,062


During the year, the company contributed £3,295 (2022: £3,250) to directors in respect of defined contribution pension schemes. 


9.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
65,861
-


65,861
-


Total current tax
65,861
-
Page 20

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023
 
9.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is the same as (2022 - the same as) the standard rate of corporation tax in the UK of 23% (2022 - 19%) as set out below:

2023
2022
£
£


Profit on ordinary activities before tax
1,158,009
889,135


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23% (2022 - 19%)
266,469
169,976

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
-
29,867

Capital allowances for year in excess of depreciation
(43,488)
(28,033)

Utilisation of tax losses
(92,459)
-

Adjustment in research and development tax credit leading to an increase (decrease) in the tax charge
(64,661)
(245,629)

Unrelieved tax losses carried forward
-
73,819

Total tax charge for the year
65,861
-


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 21

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

10.


Tangible fixed assets





Plant and machinery
Motor vehicles
Office equipment
Computer equipment
Total

£
£
£
£
£



Cost or valuation


At 1 December 2022
12,013
278,006
34,861
32,254
357,134


Additions
-
265,676
6,941
16,771
289,388



At 30 November 2023

12,013
543,682
41,802
49,025
646,522



Depreciation


At 1 December 2022
1,401
62,130
21,629
18,495
103,655


Charge for the year on owned assets
4,005
-
11,727
10,576
26,308


Charge for the year on financed assets
-
91,132
-
-
91,132



At 30 November 2023

5,406
153,262
33,356
29,071
221,095



Net book value



At 30 November 2023
6,607
390,420
8,446
19,954
425,427



At 30 November 2022
10,612
215,876
13,233
13,759
253,480

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Motor vehicles
318,701
215,876

318,701
215,876

Page 22

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

11.


Debtors

2023
2022
£
£

Due after more than one year

Other debtors
89,781
137,724

89,781
137,724


2023
2022
£
£

Due within one year

Trade debtors
283,171
166,599

Other debtors
3,368,585
2,183,764

Prepayments and accrued income
7,473,914
5,978,949

11,125,670
8,329,312



12.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
9,128,157
5,729,964

Corporation tax
65,861
-

Other taxation and social security
33,483
21,789

Obligations under finance lease and hire purchase contracts
118,591
63,588

Other creditors
765,365
162,147

Accruals and deferred income
780,780
879,865

10,892,237
6,857,353


There is an overdraft facility available to Kingsheath Construction Limited which is secured against the assets of the business by a fixed and floating charge. 


13.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Net obligations under finance leases and hire purchase contracts
198,404
130,969

198,404
130,969


Page 23

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

14.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



225,000 (2022 - 225,000) A Ordinary shares of £1.00 each
225,000
225,000
75,000 (2022 - 75,000) B Ordinary shares of £1.00 each
75,000
75,000
3 (2022 - 3) C Ordinary shares of £1.00 each
3
3

300,003

300,003

Ordinary A and B shares have attached to them full voting, dividend and capital distribution rights; they do not confer any rights of redemption. 
Ordinary C shares have attached to them separate dividend rights. They do not confer voting, capital distribution and redemption rights. 



15.


Reserves

Share premium account

This reserve records the cumulative premium on shares issued.

Profit and loss account

This reserve records retained earnings and accumulated losses.

16.


Analysis of net debt





At 1 December 2022
Cash flows
New finance leases
At 30 November 2023
£

£

£

£

Cash at bank and in hand

787,140

1,539,464

-

2,326,604

Debt due within 1 year

(2,858)

(1,499)

-

(4,357)

Finance leases

(194,557)

89,798

(212,237)

(316,996)


589,725
1,627,763
(212,237)
2,005,251

Page 24

 
Kingsheath Construction Limited
 

 
Notes to the financial statements
For the year ended 30 November 2023

17.


Commitments under operating leases

At 30 November 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
98,776
218,844

Later than 1 year and not later than 5 years
64,464
184,256

163,240
403,100


18.


Related party transactions

During the year, the company purchased services amounting to £2,841,496 (2022: £1,250,000) from Kingsheath Plant Limited, a company in which Mr J Pike has a controlling interest. These services were purchased on an arm’s length basis. At the year-end the company owed Kingsheath Plant Limited £799,073 (2022: the company was owed by Kingsheath Plant Limited £203,884).


19.


Controlling party

The company is controlled by Mr J Pike, a director, by virtue of his majority interest in the issued ordinary share capital of the company. 


Page 25