Company registration number 12538083 (England and Wales)
WESCOTT GROUP LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
WESCOTT GROUP LTD
COMPANY INFORMATION
Directors
Mr K Carruthers
Mr M T Doyle
Mr M Duffy
Company number
12538083
Registered office
Unit 9B/9C
Shaftsbury Avenue
Simonside Industrial Estate
Jarrow
Tyne & Wear
NE32 3UP
Auditor
Harlands Accountants LLP
The Greenhouse
Greencroft Industrial Park
Stanley
England
DH9 7XN
WESCOTT GROUP LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10 - 11
Company balance sheet
12
Group statement of changes in equity
13
Company statement of changes in equity
14
Group statement of cash flows
15
Company statement of cash flows
16
Notes to the financial statements
17 - 33
WESCOTT GROUP LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

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

Principal activities

The company acts as parent, and the consolidated group accounts include the results and assets of the company and its subsidiaries. The principle activities of the subsidiaries include Industrial Coatings, Scaffold Access and Support Systems and Safety and Training Services. The companies in the group operate in the following markets: Offshore Renewables, Marine, Rail & Infrastructure, Refineries and Construction.

Review of the business

The company is pleased with the results in the year although posting a loss. We have managed to add several new clients and had numerous major contract awards in the offshore renewables and marine sectors with multi year frameworks agreed. Forward orders as of year end March 2023 stand at £16.54m with further long term contracts being awarded in year end March 2024.

 

Costs of finance have risen drastically during the year and our aim is to ensure all debts are paid by July 2025 with a further £0.55m reduction of debt in the period.

 

We conducted an overhead cost review during the year and have identified c. £630k of savings to be made by removing several senior management personnel which was performed in year end March 2024.

 

We have seen significant growth (+163%) in offshore renewables and the market share of revenue now stands at 45% as of year end March 2024 with high levels of profitability and sustainable growth in this sector. Our Marine sector will see significant growth in year end March 2024 from £0.4m to c. £4.3m due to the award of a multi year framework agreement.

Principal risks and uncertainties

The Company’s principal risks and uncertainties are integrated with the principal risks of the UK economy as a whole. Demand, resource shortages and global issues can all have an impact. Alongside the industry risks, there are also general economic and legislative risks than can impact operations and increase costs.

 

During recent years, the industry has had to deal with a global pandemic, which reduced demand, followed by a surge in demand as the restrictions of human movement were lifted and backlogs of work required to be carried out quickly. However, the industry has been unable to keep up with demand due to labour shortages, interest costs, restrictions of labour movement into the UK and significant issues with main contractor liquidity.

Development and performance

The results presented for year end March 2023 show a worsening of the financial position in comparison to the previous year. The company remains in a liquid position at the year end and can meet its Current Liabilities.

 

The directors are confident the business remains viable and the year end March 2024 results will post a significant step change in comparison and swing into profitability after the cost saving exercises and new contract awards.

Key performance indicators

 

2023 (£000)

 

2022 (£000)

 

Change (£000)

Turnover

11,082

 

7,731

 

3,351

Operating Profit

(529)

 

(200)

 

(329)

Profit / (Loss) before tax

(609)

 

(242)

 

(367)

Shareholder's funds

2,047

 

2,397

 

(350)

 

WESCOTT GROUP LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -

 

2023

 

2022

 

Change

Average number of employees

109

 

104

 

5

On behalf of the board

Mr M T Doyle
Director
30 July 2024
WESCOTT GROUP LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

The directors present their annual report and financial statements for the year ended 31 March 2023.

Results and dividends

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

Ordinary dividends were paid amounting to £130,500. The directors do not recommend payment of a further dividend.

Directors

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

Mr K Carruthers
Mr M T Doyle
Mr M Duffy
Financial instruments
Financial risk management policy

The group’s principal financial instruments compromise cash, cash equivalents and loans, the main purpose of which is to raise finance for the group’s operations. In addition, the group has various other financial assets and liabilities such as trade debtors and trade creditors arising directly from its operations.

Liquidity risk

The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.

Interest rate risk

The group is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest rate risk on floating rate deposits, bank overdrafts and loans.

Credit risk

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

WESCOTT GROUP LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
Statement of directors' responsibilities

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

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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 auditor of the company 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 auditor of the company is aware of that information.

On behalf of the board
Mr M T Doyle
Director
30 July 2024
2024-07-30
WESCOTT GROUP LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF WESCOTT GROUP LTD
- 5 -

Qualified opinion on financial statements

We have audited the financial statements of Wescott Group Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:

Basis for qualified opinion

We were not engaged as auditor of the company until after 31 March 2023 and thus were not able to gather sufficient audit evidence to satisfy ourselves relating to the following estimates:

Consequently we were unable to determine whether any adjustment to this amount was necessary.

 

In addition, were any adjustment to these balances in the items above to be required, the strategic report would also need to be amended.

 

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 group and parent 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 qualified 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 group's and parent 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.

WESCOTT GROUP LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WESCOTT GROUP LTD
- 6 -

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

 

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the various items held at 31 March 2023. We have concluded that where the other information refers to these items, or related balances in the Profit and Loss, it may be materially misstated for the same reason.

Opinions on other matters prescribed by the Companies Act 2006

Except for the possible effects of the matters described in the basis for qualified opinion section of our report, in our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In respect solely of the limitation on our work relating to stock, described above:

 

Except for the possible effects of the matter described in the basis for qualified opinion section of our report, in the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

Arising solely from the limitation on the scope of our work relating to fixed assets, accrued income and related party debtor, referred to above:

 

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 parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

WESCOTT GROUP LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WESCOTT GROUP LTD
- 7 -
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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Discussions with and enquiries of management and those charged with governance were held with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.

 

The following laws and regulations were identified as being of significance to the entity:

- Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law, Tax and Pensions legislation and distributable profits legislation.

- Those laws and regulations for which non-compliance may be fundamental to the operating aspects of the business and therefore may have a material effect on the financial statements include operating license, environmental regulations and health and safety legislation.

 

Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of; inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; testing the appropriateness of journal entries; and the performance of analytical review to identify unexpected movements in account balances which may be indicative of fraud.

 

No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity's controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).

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.

Glyn Davison FCCA (Senior Statutory Auditor)
For and on behalf of Harland Accountants LLP
Chartered Accountants
& Statutory Auditors
The Greenhouse
Greencroft Industrial Park
Stanley
England
DH9 7XN
30 July 2024
WESCOTT GROUP LTD
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
10,218,780
7,723,855
Cost of sales
(6,887,538)
(5,217,258)
Gross profit
3,331,242
2,506,597
Administrative expenses
(3,964,570)
(2,875,606)
Other operating income
104,406
168,645
Operating loss
4
(528,922)
(200,364)
Interest receivable and similar income
7
11,396
-
0
Interest payable and similar expenses
8
(91,623)
(41,842)
Amounts written off investments
9
-
20
Loss before taxation
(609,149)
(242,186)
Tax on loss
10
396,020
397,692
(Loss)/profit for the financial year
(213,129)
155,506
(Loss)/profit for the financial year is attributable to:
- Owners of the parent company
(211,834)
138,607
- Non-controlling interests
(1,295)
16,899
(213,129)
155,506
WESCOTT GROUP LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
2023
2022
£
£
(Loss)/profit for the year
(213,129)
155,506
Other comprehensive income
Revaluation of tangible fixed assets
-
0
367,117
Total comprehensive income for the year
(213,129)
522,623
Total comprehensive income for the year is attributable to:
- Owners of the parent company
(211,834)
487,368
- Non-controlling interests
(1,295)
35,255
(213,129)
522,623
WESCOTT GROUP LTD
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
547,409
729,879
Tangible assets
13
2,903,880
2,519,585
3,451,289
3,249,464
Current assets
Stocks
16
78,964
25,124
Debtors
17
3,015,882
3,272,365
Cash at bank and in hand
46,062
167,587
3,140,908
3,465,076
Creditors: amounts falling due within one year
18
(3,393,067)
(2,965,633)
Net current (liabilities)/assets
(252,159)
499,443
Total assets less current liabilities
3,199,130
3,748,907
Creditors: amounts falling due after more than one year
19
(716,585)
(1,061,905)
Provisions for liabilities
Deferred tax liability
23
435,651
289,611
(435,651)
(289,611)
Net assets
2,046,894
2,397,391
Capital and reserves
Called up share capital
26
300
300
Revaluation reserve
25
681,019
681,019
Capital redemption reserve
27
142
142
Merger reserves
270
270
Profit and loss reserves
1,173,233
1,515,567
Equity attributable to owners of the parent company
1,854,964
2,197,298
Non-controlling interests
191,930
200,093
2,046,894
2,397,391

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

WESCOTT GROUP LTD
GROUP BALANCE SHEET (CONTINUED)
AS AT
31 MARCH 2023
31 March 2023
- 11 -
The financial statements were approved by the board of directors and authorised for issue on 30 July 2024 and are signed on its behalf by:
30 July 2024
Mr M T Doyle
Director
Company registration number 12538083 (England and Wales)
WESCOTT GROUP LTD
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
14
900,570
900,570
Current assets
Cash at bank and in hand
300
300
Creditors: amounts falling due within one year
18
(905,330)
(900,570)
Net current liabilities
(905,030)
(900,270)
Net (liabilities)/assets
(4,460)
300
Capital and reserves
Called up share capital
26
300
300
Profit and loss reserves
(4,760)
-
Total equity
(4,460)
300

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £125,740 (2022 - £130,500 profit).

For the financial year ended 31 March 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the board of directors and authorised for issue on 30 July 2024 and are signed on its behalf by:
30 July 2024
Mr M T Doyle
Director
Company registration number 12538083 (England and Wales)
WESCOTT GROUP LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
Share capital
Revaluation reserve
Capital redemption reserve
Merger reserves
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
£
£
£
Balance at 1 April 2021
110
313,902
332
270
1,527,991
1,842,605
171,821
2,014,426
Year ended 31 March 2022:
Profit for the year
-
-
-
-
138,607
138,607
16,899
155,506
Other comprehensive income:
Revaluation of tangible fixed assets
-
367,117
-
-
-
367,117
-
367,117
Amounts attributable to non-controlling interests
-
-
-
-
(18,356)
(18,356)
18,356
-
Total comprehensive income
-
367,117
-
-
120,251
487,368
35,255
522,623
Dividends
11
-
-
-
-
(132,675)
(132,675)
(6,983)
(139,658)
Redemption of shares
26
190
-
(190)
-
-
-
0
-
-
Balance at 31 March 2022
300
681,019
142
270
1,515,567
2,197,298
200,093
2,397,391
Year ended 31 March 2023:
Loss and total comprehensive income
-
-
-
-
(211,834)
(211,834)
(1,295)
(213,129)
Dividends
11
-
-
-
-
(130,500)
(130,500)
(6,868)
(137,368)
Balance at 31 March 2023
300
681,019
142
270
1,173,233
1,854,964
191,930
2,046,894
WESCOTT GROUP LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2021
300
-
0
300
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
130,500
130,500
Dividends
11
-
(130,500)
(130,500)
Balance at 31 March 2022
300
-
0
300
Year ended 31 March 2023:
Profit and total comprehensive income
-
125,740
125,740
Dividends
11
-
(130,500)
(130,500)
Balance at 31 March 2023
300
(4,760)
(4,460)
WESCOTT GROUP LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
(233,397)
472,093
Interest paid
(91,623)
(41,842)
Income taxes refunded
569,138
406,169
Net cash inflow from operating activities
244,118
836,420
Investing activities
Purchase of intangible assets
-
(464,500)
Purchase of tangible fixed assets
(488,714)
(702,719)
Proceeds from disposal of tangible fixed assets
6,000
190,963
Proceeds from disposal of investments
-
20
Interest received
20
-
0
Dividends received
11,376
-
0
Net cash used in investing activities
(471,318)
(976,236)
Financing activities
Repayment of bank loans
(42,818)
(212,782)
Payment of finance leases obligations
288,824
77,957
Dividends paid to equity shareholders
(130,500)
(132,675)
Dividends paid to non-controlling interests
(6,868)
(6,983)
Net cash generated from/(used in) financing activities
108,638
(274,483)
Net decrease in cash and cash equivalents
(118,562)
(414,299)
Cash and cash equivalents at beginning of year
(247,283)
167,016
Cash and cash equivalents at end of year
(365,845)
(247,283)
Relating to:
Cash at bank and in hand
46,062
167,887
Bank overdrafts included in creditors payable within one year
(411,907)
(415,170)
WESCOTT GROUP LTD
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 16 -
2023
2022
as restated
Notes
£
£
£
£
Cash flows from operating activities
Investing activities
Dividends received
130,500
130,500
Net cash generated from investing activities
130,500
130,500
Financing activities
Dividends paid to equity shareholders
(130,500)
(130,500)
Net cash used in financing activities
(130,500)
(130,500)
Net increase in cash and cash equivalents
-
-
Cash and cash equivalents at beginning of year
300
300
Cash and cash equivalents at end of year
300
300
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 17 -
1
Accounting policies
Company information

Wescott Group Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

 

The group consists of Wescott Group Ltd and all of its subsidiaries.

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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -
1.2
Basis of consolidation

The Group financial statements consolidate the financial statements of the Parent Company and its subsidiary undertakings drawn up to 31 March each year. The results of subsidiaries acquired or sold are consolidated for the periods from or to the date on which control passed. Business combinations are accounted for under the purchase method and merger accounting method. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.

 

Business Combination

The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition related costs are capitalised with the cost of the investment. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition by acquisition basis, the Group recognises any non- controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets.

 

The conditions for accounting for an acquisition as a merger are–

(a) that the undertaking whose shares are acquired is ultimately controlled by the same party both before and after the acquisition,

(b) that the control referred to in paragraph (a) is not transitory, and

(c) that adoption of the merger method accords with generally accepted accounting principles or practice.

Transactions which do not meet the conditions must be accounted for using the purchase method, meaning a full fair value exercise must be carried out and the recognition of goodwill.

 

Where a company issues equity shares in consideration for securing a holding of at least 90% of the nominal value of each class of equity in another company, the application of merger relief is compulsory. Merger relief is a statutory relief from recognising any share premium on shares issued. Instead, a merger reserve is recorded equal to the value of share premium which would have been recorded if the provisions of section 612 of the Companies Act 2006 had not been applicable.

 

The use of merger accounting means book values, as opposed to fair values, are used. This is a considerable difference when compared to the purchase method of accounting. This means that under the merger accounting method the carrying values of the assets and liabilities of the parties to the combination are not required to be adjusted to fair value, although appropriate adjustments need be made to achieve uniformity of accounting policies in the combining entities.

 

Where non-controlling interest (NCI) exists in a group, merger accounting would only be appropriate where the NCI in the net assets does not change. Hence, where a group reconstruction takes place, the transfer of a subsidiary within a sub-group which contains NCI may qualify for merger accounting, but the purchase method of accounting must be applied to the transfer of a subsidiary into, or out of, a sub-group. Similarly, where NCI has increased or decreased (i.e. NCI have disposed of or acquired additional shares), the use of the acquisition method of accounting is to be used.

 

Subsidiaries

Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

 

 

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
1.3
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.

1.4
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 and volume rebates.

 

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.5
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 Years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.6
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. Cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operation in the manner intended by management.

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:

Freehold land and buildings
Nil Depreciation
Plant and equipment
From 10% to 50% Straight line
Fixtures and fittings
25% Straight line
Computers
25% Straight line
Motor vehicles
From 10% to 33% 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 recognised in the profit and loss account.

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -
1.7
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

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

1.8
Impairment of fixed assets

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

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

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

 

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

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

1.9
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 21 -
1.10
Cash and cash equivalents

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

1.11
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 22 -
Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

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

1.12
Equity instruments

Equity instruments issued by the group 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 group.

1.13
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 23 -
Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

 

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

 

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

1.14
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

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

 

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

1.15
Retirement benefits

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

1.16
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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

1.17
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 24 -
2
Judgements and key sources of estimation uncertainty

In the application of the group’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.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
UK Sales
11,082,450
7,731,435
2023
2022
£
£
Other revenue
Interest income
20
-
Dividends received
11,376
-
Grants received
104,406
168,645
4
Operating loss
2023
2022
£
£
Operating loss for the year is stated after charging/(crediting):
Government grants
(104,406)
(168,645)
Depreciation of owned tangible fixed assets
102,438
84,484
Profit on disposal of tangible fixed assets
(4,019)
-
Amortisation of intangible assets
182,470
182,470
Operating lease charges
72,653
143,911
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 group and company
15,000
-
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Other Staff
106
101
-
-
Directors
3
3
-
-
Total
109
104
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
5,098,551
4,288,651
-
0
-
0
Social security costs
580,017
466,654
-
-
Pension costs
69,592
70,352
-
0
-
0
5,748,160
4,825,657
-
0
-
0
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
20
-
0
Other income from investments
Dividends received
11,376
-
0
Total income
11,396
-
0
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
20
-
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
76,131
38,344
Other finance costs:
Interest on finance leases and hire purchase contracts
15,492
3,498
Total finance costs
91,623
41,842
9
Amounts written off investments
2023
2022
£
£
Gain on disposal of financial assets held at cost
-
20
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(520,060)
(477,590)
Adjustments in respect of prior periods
(22,001)
-
0
Total current tax
(542,061)
(477,590)
Deferred tax
Origination and reversal of timing differences
146,041
79,898
Total tax credit
(396,020)
(397,692)

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

2023
2022
£
£
Loss before taxation
(609,149)
(242,186)
Expected tax charge based on the standard rate of corporation tax in the UK of 0% (2022: 0%)
-
-
Research and development tax credit
(396,020)
(397,692)
Taxation credit
(396,020)
(397,692)
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Final paid
130,500
130,500
12
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 April 2022 and 31 March 2023
912,349
Amortisation and impairment
At 1 April 2022
182,470
Amortisation charged for the year
182,470
At 31 March 2023
364,940
Carrying amount
At 31 March 2023
547,409
At 31 March 2022
729,879
The company had no intangible fixed assets at 31 March 2023 or 31 March 2022.
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 28 -
13
Tangible fixed assets
Group
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 April 2022
525,073
2,590,956
103,106
63,177
273,400
3,555,712
Additions
-
0
430,058
932
8,660
49,064
488,714
Disposals
-
0
(49,523)
-
0
-
0
-
0
(49,523)
At 31 March 2023
525,073
2,971,491
104,038
71,837
322,464
3,994,903
Depreciation and impairment
At 1 April 2022
-
0
723,434
74,621
57,840
180,232
1,036,127
Depreciation charged in the year
-
0
74,204
6,421
4,521
17,292
102,438
Eliminated in respect of disposals
-
0
(47,542)
-
0
-
0
-
0
(47,542)
At 31 March 2023
-
0
750,096
81,042
62,361
197,524
1,091,023
Carrying amount
At 31 March 2023
525,073
2,221,395
22,996
9,476
124,940
2,903,880
At 31 March 2022
525,073
1,867,522
28,485
5,337
93,168
2,519,585
The company had no tangible fixed assets at 31 March 2023 or 31 March 2022.
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
900,570
900,570
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 April 2022 and 31 March 2023
900,570
Carrying amount
At 31 March 2023
900,570
At 31 March 2022
900,570
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 29 -
15
Subsidiaries

Details of the company's subsidiaries at 31 March 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Indirect
Wescott Industrial Services Ltd
Unit 9B/9C
Shaftsbury Avenue
Simonside Industrial Estate
Jarrow
Tyne & Wear
NE32 3UP
coating activities and training
Ordinary Shares
95.00
-
S.G.S. Limited (100% subsidary of Wescott Industrial Services Ltd)
Foster Street
Stoneferry Road
Kingston upon Hull
HU8 8BT
scaffolding activities
Ordinary Shares
-
95.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Wescott Industrial Services Ltd
1,226,995
104,004
S.G.S. Limited (100% subsidary of Wescott Industrial Services Ltd)
1,711,560
(129,903)

The subsidiary companies are exempt from the requirement of the Companies Act 2006 relating to the audit of the individual accounts by virtue of S479A.

16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
78,964
25,124
-
-
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,527,434
1,624,757
-
0
-
0
Corporation tax recoverable
520,060
547,900
-
0
-
0
Other debtors
485,730
493,055
-
0
-
0
Prepayments and accrued income
482,658
606,653
-
0
-
0
3,015,882
3,272,365
-
-
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 30 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
1,170,679
804,418
-
0
-
0
Obligations under finance leases
281,842
60,040
-
0
-
0
Trade creditors
818,834
990,518
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
905,330
900,570
Corporation tax payable
-
0
762
-
0
-
0
Other taxation and social security
591,887
333,693
-
-
Other creditors
339,838
240,432
-
0
-
0
Accruals and deferred income
189,987
536,070
-
0
-
0
3,393,067
2,965,933
905,330
900,570
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
560,004
972,346
-
0
-
0
Obligations under finance leases
156,581
89,559
-
0
-
0
716,585
1,061,905
-
-
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
1,318,776
1,361,594
-
0
-
0
Bank overdrafts
411,907
415,170
-
0
-
0
1,730,683
1,776,764
-
-
Payable within one year
1,170,679
804,418
-
0
-
0
Payable after one year
560,004
972,346
-
0
-
0

The long-term loans are secured by fixed charges over the assets to which they relate.

 

WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 31 -
21
Operating lease commitments

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

2023
2022
£
£
Within one year
281,842
-
Between two and five years
156,581
-
438,423
-
22
Ultimate Controlling party

The ultimate controlling party of the group are the directors of Wescott Group Ltd by virtue of their shareholding in the parent company for the current year and by virtue of their shareholding in the company for the preceding year.

 

 

23
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£
£
Tax losses
435,651
289,611
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 April 2022
289,611
-
Charge to equity
146,040
-
Liability at 31 March 2023
435,651
-
24
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
69,592
70,352
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
24
Retirement benefit schemes
(Continued)
- 32 -

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

25
Revaluation reserve
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning of the year
681,019
313,902
-
0
-
0
Revaluation surplus arising in the year
-
0
367,117
-
0
-
0
At the end of the year
681,019
681,019
-
0
-
26
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
300 shares of £1 each
300
300
300
300
27
Capital redemption reserve
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning of the year
142
332
-
-
0
Transfers
-
(190)
-
-
At the end of the year
142
142
-
0
-
0

The capital redemption represents shares which were redeemed by Wescott Industrial Services Limited.

28
Merger reserves
2023
2022
Group
£
£
At the beginning and end of the year
270
270
2023
2022
Company
£
£
At the beginning and end of the year
-
-
WESCOTT GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
28
Merger reserves
(Continued)
- 33 -

Merger reserves arise on acquisition of Wescott Industrial Services Ltd (WISL) wherein Wescott Group Limited issued its own shares to WISL in consideration for securing a holding of at least 90% of the nominal value of equity in WISL.

 

WESCOTT GROUP LTD
PARENT COMPANY PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
2023
2022
£
£
Administrative expenses
(4,760)
-
0
Interest receivable and similar income
130,500
130,500
Profit before taxation
125,740
130,500
Tax on profit
-
0
-
0
Profit for the financial year
125,740
130,500
2023-03-312022-04-01falseCCH SoftwareCCH Accounts Production 2024.100Mr K CarruthersMr M T DoyleMr M 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