Company registration number 3411438 (England and Wales)
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
COMPANY INFORMATION
Director
Miss A Mitry
Secretary
Mr N Mitry
Company number
3411438
Registered office
Lansdowne Building
Lansdowne Road
East Croydon
London
England
CR9 2ER
Auditor
Clay Ratnage Daffin & Co Limited
Suite D, The Business Centre
Faringdon Avenue
Romford
Essex
England
RM3 8EN
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2 - 3
Independent auditor's report
4 - 6
Statement of income and retained earnings
7
Balance sheet
8
Statement of cash flows
9
Notes to the financial statements
10 - 19
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The director presents the strategic report for the year ended 31 December 2023.

Review of business

The company’s principal activity continues to be that of a mechanical contractor, specialising in building services design and installation. We focus on the delivery of a high quality service throughout each project and the building of close relationships with our main customers.

Operations are predominantly within the London/M25 corridor with a focus on commercial office fit outs and refurbishments, hospitals and healthcare units.

Principal risks and uncertainties

The Director monitors both financial and quality performance on a job-by-job basis throughout the life of the project to ensure proper performance. Key risks are – poor results from individual contracts; subcontractor quality and financial stability; retention and recruitment of high calibre staff; and health and safety risks on site.

These risks are mitigated by the financial and operational monitoring and reporting of projects; maintaining relationships with established subcontractors and undertaking financial reviews for new subcontract suppliers; employee engagement with training and the maintenance of a good working environment; regular site-based health and safety reviews.

Results and performance including key performance indicators

The results for the year show an operational profit of £367,553 (2022: £394,547) and a pre-tax profit of £368,382 (2022: £394,555).

Reference is also made to the following Key Performance Indicators whilst monitoring performance:

2023     2022

Turnover                    £18.5m        £16.7m    
Cash at bank                £1.8m        £2.1m
Net Current Assets            £1.6m        £1.4m

2023 was very much a year of consolidation, the company’s aim being to at least sustain the turnover levels first achieved in 2022 whilst maintaining the strength of the balance sheet. This has been achieved.

On behalf of the board

Miss A Mitry
Director
9 September 2024
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

The director presents her annual report and financial statements for the company for the year ended 31 December 2023.

Principal activities

The principal activity of the company continued to be that of the design and build of heating, ventilation and air conditioning.

Results and dividends

The results for the year are set out on page 7.

Ordinary dividends were paid amounting to £200,000. The director does not recommend payment of a final dividend.

Director

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

Miss A Mitry
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its director during the year. These provisions remain in force at the reporting date.

Financial instruments

Exposure to credit, liquidity and interest rate risks arise in the normal course of business. These are monitored by the Board of Directors and were not considered to be significant at the balance sheet date. The risks are limited by the company's financial management policies described below.

Liquidity risk

The company manages its' liquidity risk by forecasting cashflow and monitoring actual funds with the aim of managing liquidity so that there are always sufficient funds to meet current liabilities as and when they fall due.

Interest rate risk

The company has no current borrowings and manages its' cashflow so as not to require any additional facilities for working capital.

Credit risk

The company deals with creditworthy clients. Trade receivables are monitored on an ongoing basis via the company's management reporting procedures.

Post reporting date events

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

Future developments

The director is not aware of any future developments which would have a significant effect on the company.

Auditor

Clay Ratnage Daffin & Co Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Statement of director's responsibilities

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless she is 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 director is required to:

 

 

The director is 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. She is 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.

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
Miss A Mitry
Director
9 September 2024
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
- 4 -
Opinion

We have audited the financial statements of Innovation Air Conditioning and Building Services Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of income and retained earnings, the balance sheet, the 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 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.

Other matters

The financial statements of Innovation Air Conditioning and Building Services Limited for the year ended 31 December 2022 were unaudited due to the fact that the company was exempt from requiring an audit under applicable law.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 director 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 director is 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.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
- 5 -

Opinions on other matters prescribed by the Companies Act 2006

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 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 director's 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 director

As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has 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:

To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:

• Obtaining an understanding of the legal and regulatory frameworks applicable to the company and the sector in which they operate.

• Obtained an understanding of how the company is complying with those legal and regulatory frameworks by

making enquiries to the management of the company’s accounting department, and management itself.

• The susceptibility of the company’s financial statements to material misstatement caused by fraud or other

irregularities were assessed with the following procedures:

- Identifying and assessing the design effectiveness of controls which management have in place to prevent and detect fraud

 

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
- 6 -

- Understanding how those charged with governance considered and addressed the potential for override of controls and management biases

- Identifying and testing journal entries, in particular any journal entries posted with unusual account

combinations

- Assessing the extent of compliance with the relevant laws and regulations

- Assessing the extent to which pressures existed which may have increased the risk of fraudulent revenue recognition

 

Potential fraud risks that had been identified throughout the planning and commencement of the audit were communicated to the audit team.

 

The inherent limitations of audit present an unavoidable risk that we, the auditors, may not have detected some material misstatements within the financial statements despite proper planning and performance of our duties as auditors. Equally, there remains a risk of the non-detection of fraud which could involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. The audit procedures carried out are designed to detect material misstatements within the financial statements, and as such we take no responsibility for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.

 

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.

 

Lorraine Catherine Purdy FCCA
Senior Statutory Auditor
For and on behalf of Clay Ratnage Daffin & Co Limited
10 September 2024
Chartered Accountants
Statutory Auditor
Suite D, The Business Centre
Faringdon Avenue
Romford
Essex
England
RM3 8EN
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
as restated
Notes
£
£
Turnover
3
18,540,136
16,731,038
Cost of sales
(17,143,188)
(15,434,017)
Gross profit
1,396,948
1,297,021
Administrative expenses
(1,029,395)
(902,474)
Operating profit
4
367,553
394,547
Interest receivable and similar income
829
8
Profit before taxation
368,382
394,555
Tax on profit
7
(98,255)
(74,847)
Profit for the financial year
270,127
319,708
Retained earnings brought forward
1,531,697
1,411,989
Dividends
8
(200,000)
(200,000)
Retained earnings carried forward
1,601,824
1,531,697

There are no recognised gains and losses other than those passing through the profit and loss account.

 

There is no other comprehensive income for 2023 (2022: £nil).

The notes on pages 10 to 19 form part of these financial statements.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
44,515
57,001
Current assets
Debtors
11
3,830,296
4,511,821
Cash at bank and in hand
1,832,378
2,164,541
5,662,674
6,676,362
Creditors: amounts falling due within one year
12
(4,043,879)
(5,197,201)
Net current assets
1,618,795
1,479,161
Total assets less current liabilities
1,663,310
1,536,162
Creditors: amounts falling due after more than one year
13
(55,199)
-
0
Provisions for liabilities
Deferred tax liability
14
6,187
4,365
(6,187)
(4,365)
Net assets
1,601,924
1,531,797
Capital and reserves
Called up share capital
16
100
100
Profit and loss reserves
1,601,824
1,531,697
Total equity
1,601,924
1,531,797

The notes on pages 10 to 19 form part of these financial statements.

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

The financial statements were approved and signed by the director and authorised for issue on 9 September 2024.
Miss A Mitry
Director
Company registration number 3411438 (England and Wales)
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
18
(48,023)
1,153,588
Corporation taxes paid
(76,783)
(23,766)
Net cash (outflow)/inflow from operating activities
(124,806)
1,129,822
Investing activities
Purchase of tangible fixed assets
(8,186)
(45,612)
Interest received
829
8
Net cash used in investing activities
(7,357)
(45,604)
Financing activities
Dividends paid
(200,000)
(200,000)
Net cash used in financing activities
(200,000)
(200,000)
Net (decrease)/increase in cash and cash equivalents
(332,163)
884,218
Cash and cash equivalents at beginning of year
2,164,541
1,280,323
Cash and cash equivalents at end of year
1,832,378
2,164,541

The notes on pages 10 to 19 form part of these financial statements.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
1
Accounting policies
Company information

Innovation Air Conditioning and Building Services Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lansdowne Building, Lansdowne Road, East Croydon, London, England, CR9 2ER.

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 preparation of financial statements in compliance with FRS102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 2).

 

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

1.2
Going concern

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

1.3
Turnover

Turnover represents amounts receivable for goods and services net of VAT and trade discounts, as adjusted for amounts recoverable on contracts at the beginning and end of the year. Retentions are provided for within turnover as the contract progresses.

Revenue is recognised by reference to the stage of completion of each individual project. The stage of completion is assessed by attributing an appropriate proportion of total revenue to the work done on each project. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable.

1.4
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:

Leasehold improvements
straight line over the lease term
Fixtures, fittings & equipment
over 4 years straight line
Computer equipment
over 4 years straight line
Motor vehicles
over 3 years 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.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -
1.5
Impairment of fixed assets

At each balance sheet 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.

1.6
Construction 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.

The stage of completion is measured with reference to the proportion of turnover earned for work performed to date compared to estimated total turnover. Cost adjustments are made as necessary, on a project by project basis, to arrive at the anticipated project margins and these cost provisions are included in creditors under accruals.

1.7
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 (if any) are shown within borrowings in current liabilities.

1.8
Debtors and creditors receivable /  payable within one year

Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.

1.9
Financial instruments

The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors.

 

1.10
Dividends

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholder.

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.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
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, 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.

1.13
Retirement benefits

The company contributes to defined contribution pension schemes for certain employees whose assets are held separately from the company. The amounts charged to the profit and loss account in respect of pension costs are the contributions payable for the year.

1.14
Leases

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 leases asset are consumed.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the director is 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.

 

The key area of accounting estimation relates to revenue recognition and construction contracts whose policies are disclosed above.

INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2023
2022
£
£
Turnover analysed by class of business
Contract revenue
18,424,733
16,637,315
Maintenance, service and call out
115,403
93,723
18,540,136
16,731,038
2023
2022
£
£
Other revenue
Interest income
829
8

All turnover arose within the United Kingdom.

 

 

4
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
13,500
-
0
Depreciation of owned tangible fixed assets
20,672
16,344
Operating lease charges
173,883
134,170
5
Employees

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

2023
2022
Number
Number
Directors
1
1
Direct staff
23
19
Administration staff
1
1
Total
25
21
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
5
Employees
(Continued)
- 14 -

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
1,781,950
1,488,675
Social security costs
219,585
191,622
Pension costs
49,986
20,408
2,051,521
1,700,705
6
Director's remuneration
2023
2022
£
£
The following is in respect of the sole, and therefore highest paid, director:
Remuneration for qualifying services
200,000
220,000
Company pension contributions to defined contribution schemes
22,000
-
222,000
220,000

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 0).

7
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
94,615
74,965
Adjustments in respect of prior periods
1,818
-
0
Total current tax
96,433
74,965
Deferred tax
Origination and reversal of timing differences
1,456
(118)
Changes in tax rates
366
-
0
Total deferred tax
1,822
(118)
Total tax charge
98,255
74,847
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Taxation
(Continued)
- 15 -

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

2023
2022
£
£
Profit before taxation
368,382
394,555
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
86,643
74,965
Tax effect of expenses that are not deductible in determining taxable profit
6,322
4,891
Adjustments in respect of prior years
1,818
-
0
Depreciation for the year in excess of capital allowances
2,125
(4,951)
(Decrease)/increase in pension funds creditor
(475)
60
Deferred tax timing differences
1,456
(118)
Deferred tax rate increase
366
-
0
Taxation charge for the year
98,255
74,847
8
Dividends
2023
2022
£
£
Interim paid
200,000
200,000
9
Prior period adjustment
Reconciliation of changes in equity
The prior period adjustments do not give rise to any effect upon equity.
Reconciliation of changes in profit for the previous financial period
2022
£
Adjustments to prior year
Turnover understated
471,185
Cost of sales understated
(471,185)
Total adjustments
-
Profit as previously reported
319,708
Profit as adjusted
319,708
There are no prior period adjustments to balance sheet items.
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
10
Tangible fixed assets
Leasehold improvements
Fixtures, fittings & equipment
Computer equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
15,164
19,880
75,213
34,223
144,480
Additions
-
0
-
0
8,186
-
0
8,186
At 31 December 2023
15,164
19,880
83,399
34,223
152,666
Depreciation and impairment
At 1 January 2023
2,210
8,079
47,980
29,210
87,479
Depreciation charged in the year
3,792
3,640
13,240
-
0
20,672
At 31 December 2023
6,002
11,719
61,220
29,210
108,151
Carrying amount
At 31 December 2023
9,162
8,161
22,179
5,013
44,515
At 31 December 2022
12,954
11,801
27,233
5,013
57,001

The carrying value of land and buildings comprises:

2023
2022
£
£
Short leasehold
9,162
12,954
11
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
582,295
2,690,813
Gross amounts owed by contract customers
2,921,948
1,440,145
Other debtors
185,031
57,487
Prepayments and accrued income
61,305
58,720
3,750,579
4,247,165
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
11
Debtors
(Continued)
- 17 -
2023
2022
Amounts falling due after more than one year:
£
£
Trade debtors
40,923
264,656
Other debtors
38,794
-
0
79,717
264,656
Total debtors
3,830,296
4,511,821
12
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
263,548
1,493,804
Corporation tax
94,615
74,965
Other creditors
17,903
40,803
Accruals and deferred income
3,667,813
3,587,629
4,043,879
5,197,201

Other creditors includes employers pension contributions payable of £0 (2022: £2,019).

13
Creditors: amounts falling due after more than one year
2023
2022
£
£
Accruals and deferred income
55,199
-
0
14
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
6,187
4,365
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Deferred taxation
(Continued)
- 18 -
2023
Movements in the year:
£
Liability at 1 January 2023
4,365
Charge to profit or loss
1,822
Liability at 31 December 2023
6,187

The deferred tax liability set out above is expected to reverse within 3 years and relates to accelerated capital allowances that are expected to mature within the same period.

15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
49,986
20,408

The company operates defined contribution pension schemes for all qualifying employees. The assets of the schemes are held separately from those of the company in independently administered funds.

16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
17
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
133,206
132,470
Between two and five years
364,371
485,717
497,577
618,187
INNOVATION AIR CONDITIONING AND BUILDING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
18
Cash (absorbed by)/generated from operations
2023
2022
£
£
Profit for the year after tax
270,127
319,708
Adjustments for:
Taxation charged
98,255
74,847
Investment income
(829)
(8)
Depreciation and impairment of tangible fixed assets
20,672
16,344
Movements in working capital:
Decrease/(increase) in debtors
681,525
(2,438,351)
(Decrease)/increase in creditors
(1,117,773)
3,181,048
Cash (absorbed by)/generated from operations
(48,023)
1,153,588
19
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
2,164,541
(332,163)
1,832,378
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