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Company registration number: 06448915







ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 DECEMBER 2023


CORT BUSINESS SERVICES UK LIMITED






































img75ca.png                        

 


CORT BUSINESS SERVICES UK LIMITED
 


 
COMPANY INFORMATION


Directors
D. Lansford 
K. Ebenezer 
M.E. Davis 




Company secretary
D. Lansford



Registered number
06448915



Registered office
Unit 28 Barwell Business Park
Leatherhead Road

Chessington

Surrey

KT9 2NY




Independent auditors
Menzies LLP
Chartered Accountants & Statutory Auditor

Ashcombe House

5 The Crescent

Leatherhead

Surrey

KT22 8DY





 


CORT BUSINESS SERVICES UK LIMITED
 



CONTENTS



Page
Strategic Report
1 - 2
Directors' Report
3 - 4
Independent Auditors' Report
5 - 8
Statement of Income and Retained Earnings
9
Statement of Financial Position
10
Statement of Changes in Equity
11
Notes to the Financial Statements
12 - 22


 


CORT BUSINESS SERVICES UK LIMITED
 


 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction

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

Principal activities and business review
 
The company’s principal activity is the rental of domestic furniture.
The company achieved a turnover of £5,215,831 (2022 - £6,123,613). This reduction was primarily due to lower demand for domestic furniture rental from individuals relocating to the UK in 2023 than in the prior year. 
For much of our income we are dependent on the volume of medium to long term staff secondments by international companies to the UK. Restrictions on business travel to the UK were lifted in 2021 and substantial demand pent-up during the pandemic was released in the second half of 2021 and through 2022. However, with UK inflation high and economic growth rate low, this relocation demand from international companies slowed in 2023. Residential demand in the year remained limited by the scarcity of available rental letting stock in the market, with low levels of property churn restricting availability to renters. Positively, we continue to derive incremental growth in large scale build to rent sector installations.
Although we have continued to manage our inventory carefully, cost and sales mix changes caused gross margin to worsen to 74.8% (2022 – 80.6%). Whilst distribution costs reduced year on year in line with volume, some costs, particularly utilities, increased. As a result, the loss before tax was £442,696 (2022 - profit before tax £301,742). Net assets at the year-end were £4,218,883 (2022 - £5,770,588).
The outlook for 2024 will be dominated by the pace of reduction in inflation and interest rates, any growth in the economy and political uncertainty due to the pending UK general election. This will have a short-term impact on some of our markets, but we will be able to maintain an income stream throughout. In addition, we have sufficient cash reserves and the ongoing support from our Holding Company.

Principal risks and uncertainties
 
The management of the business and the execution of the company’s strategy are subject to several key risks:
 
1)International companies reducing the level of staff secondments to the UK.
2)An increase in the availability of furnished accommodation versus unfurnished accommodation.
3)A systemic reduction in the availability of rental property due to government legislative changes.
4)A change in the HR policy of multinational companies such that shipping furniture is preferred to renting furniture for an unfurnished property, although the importance of sustainability and increased costs of shipping are mitigating against this.     
5)The introduction of new competitors into the market.

Key performance indicators
 
The company uses a series of key performance indicators to monitor the performance of the business. These include, but are not limited to, the following:
Financial indicators
        2023  2022
a) Profit before tax as a percentage of turnover -8.5%   4.9%
b) Rental Assets as a percentage of turnover  68.6%  60.5%
c) Distribution costs as a percentage of turnover 13.0%  14.8%
Non-Financial indicators
        2023  2022
a) Staff turnover      6.5%  17.7%
The directors have reviewed these key performance indicators, and they are in line with expectations given the trading environment outlined above.

Page 1

 


CORT BUSINESS SERVICES UK LIMITED
 



STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Future developments
 
We will continue to develop and grow the business through our excellence in service and product.

Section 172 Statement:
 
The directors’ duty under Section 172 is to promote the success of the Company for the benefit of the members as a whole, having regard to the following matters set out in Section 172 (1):
1) Long term consequences of decisions:
 
We aim to secure our long-term prospects and viability by pursuing strategies that deliver long-term benefit to our company and supply chain. These are considered in bi-weekly reporting to senior management, monthly meetings of the UK management team, and quarterly re-forecasting of our business outlook.
 
2)Interest of employees:
 
The company issues performance, operating or status updates to staff, either in person, writing or via conference call.
 
3)Need to foster the Company’s business relationships:
 
We actively seek to acquire new customers through a range of marketing, brand, or business development initiatives. Our vision is that everything is possible through service, and this drives our customer service philosophy. Our supply of services is dependent on collaboration with a range of third-party suppliers on a long-term basis, and these are actively managed by our procurement team. 
 
4)Impact on the community & environment:
 
Through our business model, the Company seeks to minimise its environmental impact. We invest in durable products manufactured to high-quality standards and maintain the pieces throughout the furniture rental process. Our products are durable enough to be re-used several times within the rental cycle. At the end of their rental life, our furniture is taken to our CORT Furniture retail outlet to be sold to its forever home.
 
5)High standards of business conduct:
 
Our internal and external policies are reviewed by the Directors, and incorporate Anti-Bribery, Modern Slavery and General Data Protection Regulation requirements.
 
6)Act fairly between members of the Company:
 
We are a wholly owned subsidiary of CORT Business Services Corp, a Berkshire Hathaway company. Our monthly management accounts and quarterly forecasts are reviewed by key management personnel, consistent with CORT best practice, and we participate in all required Berkshire Hathaway group compliance and control activities.


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



K. Ebenezer
Director

Date: 10 September 2024

Page 2

 


CORT BUSINESS SERVICES UK LIMITED
 


 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

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

Directors

The directors who served during the year were:

J. Pederson (resigned 5 January 2024)
D. Lansford 
K. Ebenezer 
M.E. Davis 

Disclosure of information to auditors

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

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

Auditors

Under section 487(2) of the Companies Act 2006Menzies LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

Page 3

 


CORT BUSINESS SERVICES UK LIMITED
 


 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

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





K. Ebenezer
Director

Date: 10 September 2024

Page 4

 


CORT BUSINESS SERVICES UK LIMITED
 

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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CORT BUSINESS SERVICES UK LIMITED

Opinion


We have audited the financial statements of Cort Business Services UK Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Income and Retained Earnings, the Statement of Financial Position, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Other information


The other information comprises the information included in the Annual Report other than the financial statements and  our Auditors' Report thereon.  The directors are responsible for the other information contained within the Annual 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.


Page 5

 


CORT BUSINESS SERVICES UK LIMITED


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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CORT BUSINESS SERVICES UK LIMITED (CONTINUED)

Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.


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


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

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


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


Page 6

 


CORT BUSINESS SERVICES UK LIMITED


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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CORT BUSINESS SERVICES UK LIMITED (CONTINUED)

Auditors' responsibilities for the audit of the financial statements
 

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


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
 
The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant including;
 
The Companies Act 2006;
Financial Reporting Standard 102;
UK Employment Legislation;
UK Health and Safety Legislation;
General Data Protection Regulations;
UK Tax Legislation; and
FCA regulation
 
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
 
We understood how the Company is complying with those legal and regulatory frameworks by, making inquiries to management, those responsible for legal and compliance procedures. We corroborated our inquiries through our review of board minutes. 
 
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The assessment did not identify any issues in this area. 
 
We assessed the susceptibility of the Company financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included.
 
Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;
Challenging assumptions and judgments made by management in its significant accounting estimates; and
Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
 
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
 
The application of inappropriate judgements or estimations to manipulate the Company's financial position; 
Posting of unusual journals and complex transactions; and
The use of management override of controls to manipulate results, or to cause the Company to enter into transactions not in it's best interests.

Page 7

 


CORT BUSINESS SERVICES UK LIMITED


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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CORT BUSINESS SERVICES UK LIMITED (CONTINUED)


 
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Anna Johnston ACA (Senior Statutory Auditor)
for and on behalf of
Menzies LLP
Chartered Accountants & Statutory Auditor
Ashcombe House
5 The Crescent
Leatherhead
Surrey
KT22 8DY

10 September 2024
Page 8

 


CORT BUSINESS SERVICES UK LIMITED
 


 
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
As restated
2022
Note
£
£

  

Turnover
 4 
5,215,831
6,123,613

Cost of sales
  
(1,315,348)
(1,187,272)

Gross profit
  
3,900,483
4,936,341

Distribution costs
  
(677,069)
(906,098)

Administrative expenses
  
(3,953,128)
(3,750,750)

Other operating income
  
323,389
-

Other operating expenses
  
(69,291)
-

Operating (loss)/profit
 5 
(475,616)
279,493

Interest receivable and similar income
  
32,920
22,249

(Loss)/profit before tax
  
(442,696)
301,742

Tax on (loss)/profit
 9 
115,045
(237,361)

(Loss)/profit after tax
  
(327,651)
64,381

Retained earnings
  

-  as previously stated
  
4,828,159
4,706,207

-  correction of a prior period error
  
(57,571)
-

At the beginning of the year as restated
  
4,770,588
4,706,207

  

(Loss)/profit for the year
  
(327,651)
64,381

Dividends declared and paid
  
(1,224,054)
-

Retained earnings at the end of the year
  
3,218,883
4,770,588

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of income and retained earnings.

The notes on pages 12 to 22 form part of these financial statements.

Page 9

 


CORT BUSINESS SERVICES UK LIMITED
REGISTERED NUMBER:06448915



STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
As restated
2022
Note
£
£

Fixed assets
  

Tangible assets
 12 
3,774,462
3,968,101

  
3,774,462
3,968,101

Current assets
  

Debtors: amounts falling due within one year
 13 
701,837
1,118,365

Cash at bank and in hand
  
1,216,305
2,420,351

  
1,918,142
3,538,716

Creditors: amounts falling due within one year
 14 
(1,236,036)
(1,468,498)

Net current assets
  
 
 
682,106
 
 
2,070,218

Total assets less current liabilities
  
4,456,568
6,038,319

Provisions for liabilities
  

Deferred tax
 15 
(51,685)
(90,731)

Other provisions
  
(186,000)
(177,000)

  
 
 
(237,685)
 
 
(267,731)

Net assets
  
4,218,883
5,770,588


Capital and reserves
  

Called up share capital 
 17 
1,000,000
1,000,000

Profit and loss account
 18 
3,218,883
4,770,588

  
4,218,883
5,770,588


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




K. Ebenezer
Director

Date: 10 September 2024

The notes on pages 12 to 22 form part of these financial statements.

Page 10

 


CORT BUSINESS SERVICES UK LIMITED
 



STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 January 2022
1,000,000
4,706,207
5,706,207


Comprehensive income for the year

Profit for the year
-
64,381
64,381
Total comprehensive income for the year
-
64,381
64,381



At 1 January 2023 (as previously stated)
1,000,000
4,828,159
5,828,159

Prior year adjustment - correction of error
-
(57,571)
(57,571)


At 1 January 2023 (as restated)
1,000,000
4,770,588
5,770,588


Comprehensive income for the year

Loss for the year
-
(327,651)
(327,651)
Total comprehensive income for the year
-
(327,651)
(327,651)


Contributions by and distributions to owners

Dividends: Equity capital
-
(1,224,054)
(1,224,054)


At 31 December 2023
1,000,000
3,218,883
4,218,883


The notes on pages 12 to 22 form part of these financial statements.

Page 11

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Cort Business Services UK Limited is a private company limited by shares incorporated in England and Wales. The
address of the registered office is disclosed on the company information page.
The financial statements are presented in sterling which is the functional currency of the Company and rounded to
the nearest £.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

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

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
 
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Berkshire Hathaway Inc as at 31 December 2023 and these financial statements may be obtained from 3555 Farnam Street, Omaha, NE 68131.

Page 12

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

  
2.3

Revenue recognition

Operating lease income
Income from the operating lease rental of domestic and office furniture is recognised in the profit and loss account in the period to which it relates.
Finance lease income
Amounts due from lessees in respect of assets held under finance leases are included in debtors at the  amount of the net investment in the lease.
Rental payments under finance leases are apportioned between interest, which is credited to the profit and  loss account as gross earnings, and repayment of capital, which reduces the amount due from the lessee.
Gross earnings from finance leases are allocated to accounting periods to give a constant periodic rate of return on the net cash investment in the lease, using the investment period method of allocation. The initial direct costs incurred in negotiating and arranging finance leases are charged to the profit and loss account in
the period in which they are incurred.
Other
Other turnover amounts comprise the invoiced value of goods and services supplied by the company, excluding value added tax.

  
2.4

Finance leases and hire purchase contracts

Assets held under finance leases are recognised in the statement of financial position as assets and liabilities
at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset.
Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability
using the effective interest method. Finance charges are allocated to each period so as to produce a constant
rate of interest on the remaining balance of the liability.

 
2.5

Tangible fixed assets

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

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

Depreciation is provided on the following basis:

Rental assets
-
Between 2 and 5 years with 0-40% residual value
Motor vehicles
-
Over the term of the lease
Fixtures and fittings
-
15% straight line

Page 13

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.5
Tangible fixed assets (continued)

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

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

 
2.6

Operating leases: the Company as lessee

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

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

 
2.7

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, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

 
2.8

Pensions

Defined contribution pension plan

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

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

Page 14

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

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

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
 
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.10

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.

 
2.11

Dividends

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


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and    assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Depreciation is the main estimation area.
In making its judgement for depreciation management has considered the benefit accruing over the useful life of   the asset. Impairment reviews are carried out on a timely basis to ensure that the accounting policy adopted reflects a true and fair value of the assets.

Page 15

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

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


2023
As restated
2022
£
£

Rental and sale of furniture
5,215,831
6,123,613

5,215,831
6,123,613


Analysis of turnover by country of destination:

2023
As restated
2022
£
£

United Kingdom
5,215,831
6,123,613

5,215,831
6,123,613



5.


Operating (loss)/profit

The operating profit is stated after charging:

2023
As restated 2022
£
£

Other operating lease rentals
796,786
807,245

Depreciation
904,856
804,521


6.


Auditors' remuneration

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


2023
2022
£
£

Fees payable to the Company's auditors and their associates for the audit of the Company's financial statements
22,045
22,285

Fees payable to the Company's auditors and their associates in respect of:

non-audit services
3,300
3,350

Page 16

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Staff costs

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


2023
2022
£
£

Wages and salaries
2,110,331
2,088,777

Social security costs
201,182
197,569

Cost of defined contribution scheme
58,708
51,727

2,370,221
2,338,073


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


        2023
        2022
            No.
            No.







Distribution staff
25
20



Administration staff
6
5



Management staff
4
4



Sales and marketing staff
15
15

50
44


8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
174,990
160,727

Company contributions to defined contribution pension schemes
14,472
12,894

189,462
173,621


During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

Page 17

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
(75,999)
75,293

Adjustments in respect of previous periods
-
27,328


(75,999)
102,621


Total current tax
(75,999)
102,621

Deferred tax


Fixed asset timing differences
(22,623)
10,539

Short term timing differences
-
(100)

Amounts relating to prior year
(16,423)
124,301

Total deferred tax
(39,046)
134,740


Taxation on (loss)/profit on ordinary activities
(115,045)
237,361

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 23.5% (2022 - 19%). The differences are explained below:
2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(442,696)
301,742


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.5% (2022 - 19%)
(104,033)
55,240

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
-
12,436

Capital allowances for year in excess of depreciation
-
(5,413)

Other adjustments resulting in an increase / decrease in the tax charge
28,034
13,030

Adjustments to tax charge in respect of prior periods
-
27,328

Deferred tax
(39,046)
134,740

Total tax charge for the year
(115,045)
237,361


Factors that may affect future tax charges

The corporation tax rate increased to 25% from 1 April 2023.

Page 18

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Dividends

2023
2022
£
£


Dividends analysis
1,224,054
-

1,224,054
-


11.


Other items

2023
2022
£
£

Other operating income

323,389

-
 
Other operating expenses

(69,291)

-
 
254,098

-
 


12.


Tangible fixed assets





Rental assets
Motor vehicles
Fixtures and fittings
Total

£
£
£
£



Cost


At 1 January 2023 (restated)
5,514,546
226,178
294,214
6,034,938


Additions
1,112,073
-
50,021
1,162,094


Disposals
(976,622)
-
(91,278)
(1,067,900)



At 31 December 2023

5,649,997
226,178
252,957
6,129,132



Depreciation


At 1 January 2023 (restated)
1,812,003
226,177
28,657
2,066,837


Charge for the year
849,509
1
55,346
904,856


Disposals
(589,407)
-
(27,616)
(617,023)



At 31 December 2023

2,072,105
226,178
56,387
2,354,670



Net book value



At 31 December 2023
3,577,892
-
196,570
3,774,462



At 31 December 2022 (restated)
3,702,543
1
265,557
3,968,101



Page 19

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Debtors

2023
2022
£
£


Trade debtors
215,055
491,131

Other debtors
3,332
85,712

Prepayments and accrued income
359,094
493,165

Tax recoverable
124,356
48,357

701,837
1,118,365



14.


Creditors: Amounts falling due within one year

2023
As restated
2022
£
£

Trade creditors
344,204
547,304

Other taxation and social security
177,097
154,792

Other creditors
413,429
549,551

Accruals and deferred income
301,306
216,851

1,236,036
1,468,498



15.


Deferred taxation




2023


£






At beginning of year
(90,731)


Charged to profit or loss
39,046



At end of year
(51,685)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Fixed asset timing differences
(51,685)
(92,731)

Short term timing differences
-
2,000

(51,685)
(90,731)

Page 20

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Provisions




Dilapidations provision

£





At 1 January 2023
177,000


Charged to profit or loss
9,000



At 31 December 2023
186,000


17.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1,000,000 (2022 - 1,000,000) Ordinary shares of £1.00 each
1,000,000
1,000,000


Each ordinary share carries voting rights and there are no restrictions on the distribution of dividends.


18.


Reserves

Profit and loss account
This reserve represents the sum of the Company's retained earnings and accumulated losses.


19.


Prior year adjustment

During the preparation of the current year financial statements, it was noted that in prior years a bridging adjusment to reverse the right of use assets and liabilities to be in line with UK GAAP, had been incorrectly adjusted to the intercompany loan account. Therefore, a prior year adjustment has been entered to correctly derecognise the lease obligation and reinstate the related fixed assets in line with UK GAAP.
The impact on the profit and loss account at 31 December 2022 was a reduction in profit of £57,571. The impact on the balance sheet at 31 December 2022 was an increase in creditors of £195,740 and an increase in the net book value of fixed assets by £138,142. The impact on revenue was a decrease of £72,397. There is no material tax impact associated with this adjustment.


20.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately  from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £58,708 (2022 - £51,727). Contributions  totaling £6,250 (2022 - £6,170) were payable to the fund at the reporting date and are included in creditors. 

Page 21

 


CORT BUSINESS SERVICES UK LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

21.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
600,137
592,079

Later than 1 year and not later than 5 years
1,286,090
1,355,617

Later than 5 years
-
71,950

1,886,227
2,019,646


22.


Controlling party

The ultimate parent company is considered to be Berkshire Hathaway Inc, a company incorporated in the United States of America and quoted on the New York Stock Exchange. The company's immediate parent is Cort Business
Services Corp, a company incorporated in the United States of America, registered address being 14850 Conference Center Dr #110, Chantilly VA 20151.
Copies of the group accounts of Berkshire Hathaway Inc. may be obtained from 3555 Farnam Street, Omaha, NE 68131.

 
Page 22