Company registration number 03186655 (England and Wales)
ECO-1 ELECTRICAL SOLUTIONS LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
ECO-1 ELECTRICAL SOLUTIONS LTD
COMPANY INFORMATION
Directors
Mr J D Belcher
Mr J Jenkinson
Company number
03186655
Registered office
Aldridge Prime Rookery Lane
Aldridge
Walsall
West Midlands
WS9 8NP
Auditor
Edwards
34 High Street
Aldridge
Walsall
West Midlands
WS9 8LZ
ECO-1 ELECTRICAL SOLUTIONS LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of income and retained earnings
8
Balance sheet
9
Notes to the financial statements
10 - 20
ECO-1 ELECTRICAL SOLUTIONS LTD
STRATEGIC REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 1 -

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

Fair review of the business

Eco-1 Electrical Solutions Limited is the forward-thinking electrical installation company that is dedicated to improving value through long term sustainable working relationships. We are the trusted partners of leading business and institutions. We work with our customers suggesting new and innovative ways and are committed to providing solutions. It’s all about lean, sustainable, energy-saving installations delivered, safely, to the highest quality, on time and on budget. Our scale, scope and knowledge allow us to develop electrical solutions that are truly functional. We invest significant time and effort developing and renewing partnerships with suppliers, manufacturers, and subcontractors to develop experience and expertise which allows us to offer latest technology, best value, and unique insights to our customers. We are passionate about taking on new electrical challenges, providing the perfect solution and always adding value.

 

Vision

Our vision is to be the trusted electrical partner creating a positive experience for all people and companies we engage with.

 

Mission Statement

Strive to be the best in everything we do, exceeding customer expectations, leading in new efficient technology and innovation.

Principal risks and uncertainties

Economic risks include continued inflationary pressure which may further impair margins or cause delays or cancellations on secured works that are yet to commence. To diffuse such, the Company continues to source and develop added-value initiatives, with its clients and standardise product in order to ensure best value and the reduction of waste.

 

Operational risks include the risk of losses resulting from inadequate or failed installations causing delays and consequential costs. This also includes Health & Safety risks, IT, information security, project, outsourcing, tax, legal, fraud and compliance risks.

 

As part of the operational risk management process, the Company has an Operational Risk Policy, and undertakes a risk & control self-assessment process across all programs. The Company believes it has the relevant KPI’s and risk & method statements in place to support the recording of risks and controls as well as monitoring operational risks and risk events in regular reviews.

Development and performance

Whilst profitable for the 14-month period ending December 31st, 2023, inflation from supply chain & energy price increases eroded gross margin for programs secured in 2022 and installed in 2023. In addition, delayed program starts stretched the business operationally to full capacity during Q3 of 2023 also affecting profitability. However, this event lead to the Company evaluating and understanding it’s capacity levels and now used as another driver for the business.

 

The Company has developed a 5-year strategic growth plan and currently are on target and has every expectation to deliver this in accordance.

ECO-1 ELECTRICAL SOLUTIONS LTD
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 2 -
Key performance indicators

The Company maintains and reports several KPIs to measure and evaluate business performance against targets, budgets and 5-year strategy outlooks. These include turnover, project margins, net profitability, rolling profitability and cash forecasts, employee attendance & turnover. Programs that overlap several months also have monthly detailed ‘cost to complete’ reviews to evaluate financial performance in progress.

 

On behalf of the board

Mr J D Belcher
Director
3 September 2024
ECO-1 ELECTRICAL SOLUTIONS LTD
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 3 -

The directors present their annual report and financial statements for the period ended 31 December 2023.

Principal activities

The principal activity of the company continued to be that of electrical contractors.

Trading review

The directors are satisfied with the trading result achieved for the period.

 

The company continues to be in a strong position and securely set for the foreseeable future which remains profitable.

 

We look forward positively and our intention is to grow as we explore other opportunities and grow our client base. However, we also are aware of challenges within the global economy and its impact on the supply chain & commodity pricing.

Results and dividends

The results for the period are set out on page 8.

Ordinary dividends were paid amounting to £105,575. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the period and up to the date of signature of the financial statements were as follows:

Mr J D Belcher
Mr J Jenkinson
Auditor

In accordance with the company's articles, a resolution proposing that Edwards be reappointed as auditor of the company will be put at a General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr J D Belcher
Director
3 September 2024
ECO-1 ELECTRICAL SOLUTIONS LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 4 -

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

 

 

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.

ECO-1 ELECTRICAL SOLUTIONS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ECO-1 ELECTRICAL SOLUTIONS LTD
- 5 -
Opinion

We have audited the financial statements of Eco-1 Electrical Solutions Ltd (the 'company') for the period ended 31 December 2023 which comprise the statement of income and retained earnings, the balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the 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 auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

ECO-1 ELECTRICAL SOLUTIONS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ECO-1 ELECTRICAL SOLUTIONS LTD (CONTINUED)
- 6 -
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:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

We obtained an understanding of the legal and regulatory frameworks within which the Company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006, employment law, Electrical Contractors Association, off-payroll working and health & safety regulations compliance.

 

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be in the following areas: the override of controls by management, revenue journals, inappropriate treatment of non-routine transactions and areas of estimation uncertainty, specifically surrounding revenue recognition and work in progress valuations under contract accounting. Our audit procedures to respond to these risks included enquiries of management about their own identification and assessment of the risks of irregularities, review and discussion of non-routine transactions, sample testing on the posting of journals and review of accounting estimates for biases.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

 

These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations.

 

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

ECO-1 ELECTRICAL SOLUTIONS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ECO-1 ELECTRICAL SOLUTIONS LTD (CONTINUED)
- 7 -

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 an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

David Webb FCA
Senior Statutory Auditor
For and on behalf of Edwards
3 September 2024
Chartered Accountants
Statutory Auditor
34 High Street
Aldridge
Walsall
West Midlands
WS9 8LZ
ECO-1 ELECTRICAL SOLUTIONS LTD
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 8 -
Period
Year
ended
ended
31 December
31 October
2023
2022
Notes
£
£
Turnover
3
18,335,059
13,977,963
Cost of sales
(15,184,231)
(11,928,725)
Gross profit
3,150,828
2,049,238
Administrative expenses
(2,350,671)
(1,466,754)
Operating profit
4
800,157
582,484
Interest receivable and similar income
8
204
2,638
Exceptional item
9
(184,529)
-
0
Profit before taxation
615,832
585,122
Tax on profit
10
(147,188)
(120,602)
Profit for the financial period
468,644
464,520
Retained earnings brought forward
2,212,550
2,518,301
Dividends
11
(105,575)
(770,271)
Retained earnings carried forward
2,575,619
2,212,550

The statement of income has been prepared on the basis that all operations are continuing operations.

ECO-1 ELECTRICAL SOLUTIONS LTD
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
31 December 2023
31 October 2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
329,498
225,624
Current assets
Stocks
13
1,981,222
3,924,310
Debtors
14
1,783,411
1,091,812
Cash at bank and in hand
2,128,875
1,955,159
5,893,508
6,971,281
Creditors: amounts falling due within one year
15
(3,196,755)
(4,432,723)
Net current assets
2,696,753
2,538,558
Total assets less current liabilities
3,026,251
2,764,182
Creditors: amounts falling due after more than one year
16
(80,000)
(200,000)
Provisions for liabilities
Deferred tax liability
18
49,000
30,000
(49,000)
(30,000)
Net assets
2,897,251
2,534,182
Capital and reserves
Called up share capital
20
57,375
57,375
Share premium account
261,710
261,710
Capital redemption reserve
2,547
2,547
Profit and loss reserves
2,575,619
2,212,550
Total equity
2,897,251
2,534,182

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 3 September 2024 and are signed on its behalf by:
Mr J D Belcher
Director
Company registration number 03186655 (England and Wales)
ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 10 -
1
Accounting policies
Company information

Eco-1 Electrical Solutions Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Aldridge Prime Rookery Lane, Aldridge, Walsall, West Midlands, WS9 8NP.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of Eco-1 Group Limited. These consolidated financial statements are available from Companies House.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Reporting period

The company has extended its period end to 31 December 2023 to align with other group members. The current reporting period is for the 14 months ended 31 December 2023. The comparative reporting period is for the 12 month period ended 31 October 2022. Comparative amounts presented in the financial statements (including the related notes) are not entirely comparable.

1.4
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts.

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Fixtures, fittings and equipment
25% Straight line
Motor vehicles
25% Straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.6
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Where a reasonable and consistent basis of allocation can be identified, assets are allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
1.7
Long term contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.

1.8
Cash at bank and in hand

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.9
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Basic financial liabilities

Basic financial liabilities, including creditors and loans from fellow group companies, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.10
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14
Leases

Rentals payable under operating leases, including any lease incentives received, are charged on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 14 -
2
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 amount 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Contract accounting

The amount of profit attributable to the stage of completion of a long term contract is recognised when the outcome of the contract can be foreseen with reasonable certainty. Turnover for such contracts is stated at the cost appropriate to their stage of completion plus attributable profits, less amounts recognised in previous years. Provision is made for any losses as soon as they are foreseen.

 

Contract work in progress is stated at cost incurred, less those transferred to the profit and loss account, after deducting foreseeable losses and payments on account not matched with turnover.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Electrical contractors
18,335,059
13,977,963
2023
2022
£
£
Other revenue
Interest income
204
2,638
4
Operating profit
2023
2022
Operating profit for the period is stated after charging/(crediting):
£
£
Depreciation of owned tangible fixed assets
127,042
54,984
Profit on disposal of tangible fixed assets
(9,341)
(36,808)
Operating lease charges
138,118
115,935
ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 15 -
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
10,500
7,250
For other services
Other non-audit services
3,140
1,500
Taxation compliance services
750
750
3,890
2,250
6
Employees

The average monthly number of persons (including directors) employed by the company during the period was:

2023
2022
Number
Number
Office/Administration
20
20
Site/Direct
20
15
Total
40
35

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
1,938,649
1,224,374
Social security costs
212,261
152,618
Pension costs
140,916
42,563
2,291,826
1,419,555
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
145,705
140,092
Company pension contributions to defined contribution schemes
10,636
1,321
156,341
141,413

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 16 -
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
-
0
2,638
Other interest income
204
-
0
Total income
204
2,638
9
Exceptional item

During the period the company suffered an exceptional cost of £184,529 (2022: £Nil) relating to a customer bad debt.

10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
128,188
91,202
Deferred tax
Origination and reversal of timing differences
19,000
29,400
Total tax charge
147,188
120,602

The actual charge for the period can be reconciled to the expected charge for the period based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
615,832
585,122
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
153,958
111,173
Tax effect of expenses that are not deductible in determining taxable profit
3,698
4,077
Tax effect of enhanced capital allowances
(108)
(1,075)
Tax effect of change in tax rates
(10,360)
6,427
Taxation charge for the period
147,188
120,602
ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 17 -
11
Dividends
2023
2022
£
£
Final paid
105,575
770,271

Included in the above are dividends amounting to £105,575 (2022: £84,460) paid to the owners of the B Ordinary Non Voting shares.

12
Tangible fixed assets
Fixtures, fittings and equipment
Motor vehicles
Total
£
£
£
Cost
At 1 November 2022
56,756
288,663
345,419
Additions
31,675
209,900
241,575
Disposals
-
0
(31,978)
(31,978)
At 31 December 2023
88,431
466,585
555,016
Depreciation and impairment
At 1 November 2022
35,646
84,149
119,795
Depreciation charged in the period
8,845
118,197
127,042
Eliminated in respect of disposals
-
0
(21,319)
(21,319)
At 31 December 2023
44,491
181,027
225,518
Carrying amount
At 31 December 2023
43,940
285,558
329,498
At 31 October 2022
21,110
204,514
225,624
13
Stocks
2023
2022
£
£
Work in progress
1,981,222
3,924,310
ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 18 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,662,556
635,404
Amounts owed by group undertakings
22,602
-
0
Other debtors
38,618
448,755
Prepayments and accrued income
59,635
7,653
1,783,411
1,091,812
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Other borrowings
17
120,000
50,000
Trade creditors
2,638,531
4,062,767
Amounts owed to group undertakings
21,728
-
0
Corporation tax
128,188
91,202
Other taxation and social security
52,338
42,477
Other creditors
47,718
29,881
Accruals and deferred income
188,252
156,396
3,196,755
4,432,723
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Other borrowings
17
80,000
200,000
17
Loans and overdrafts
2023
2022
£
£
Other borrowings
200,000
250,000
Payable within one year
120,000
50,000
Payable after one year
80,000
200,000

Other borrowings represent a loan due to a related party of £200,000 (2022: £250,000). The loan is interest free, unsecured and repayable in equal instalments.

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 19 -
18
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
49,000
30,000
2023
Movements in the period:
£
Liability at 1 November 2022
30,000
Charge to profit or loss
19,000
Liability at 31 December 2023
49,000
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
140,916
42,563

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary 'A' shares of £1 each
51,000
51,000
51,000
51,000
Ordinary 'B' shares of 10p each
63,750
63,750
6,375
6,375
114,750
114,750
57,375
57,375

The rights attached to each category of shares can be found in the company's articles of association.

ECO-1 ELECTRICAL SOLUTIONS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 20 -
21
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
44,525
56,997
Between two and five years
22,515
68,340
67,040
125,337
22
Related party transactions

During the previous period, the company was loaned £250,000 from a related party. The loan is interest free and repayable in equal monthly instalments.

 

At 31 December 2023, included within other borrowings is an amount of £200,000 (2022: £250,000) due to related parties and included within other debtors is an amount of £21,115 (2022: £21,115) due from related parties.

23
Controlling party

The company is a subsidiary undertaking of ECO-1 Group Limited, a company incorporated in England and Wales, which is the immediate and ultimate parent undertaking.

 

ECO-1 Group Limited is the largest and smallest group for which group financial statements are prepared. The group financial statements are available to the public and may be obtained from Companies House.

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