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Registered number: 02367873









BRAINTREE PRECISION COMPONENTS LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
COMPANY INFORMATION


Directors
G L Forster 
G P Forster 
B R Engstrom 
P J Fanshawe 
C G Reed 
K Peters (appointed 1 January 2024)




Company secretary
C G Reed



Registered number
02367873



Registered office
124 Finchley Road

London

NW3 5JS




Trading Address
2-8 Blackwell Drive, Tamdown Industrial Park
Off Springwood Drive, Springwood Industrial Estate

Braintree

Essex

CM7 2QJ






Independent auditors
Nyman Libson Paul LLP
Chartered Accountants & Statutory Auditors

124 Finchley Road

London

NW3 5JS




Bankers
Barclays Bank plc
53 The Broadway

Ealing

London

W5 5JS





 
BRAINTREE PRECISION COMPONENTS LIMITED
 

CONTENTS



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


 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The principal activities of the company are the manufacture and distribution of precision engineering components.

Business review
 
During the year turnover has increased significantly compared with 2022. The company has continued to expand its workforce and invest heavily in machinery. This has lead to operational efficiencies, allowing the company to maintain its profit margins and wages to turnover ratio.

Principal risks and uncertainties
 
The company is reliant on the sales performance of its associated company, however the group of companies is strong with significant investment in capital assets being made in recent years.

Financial key performance indicators
 
Key performance indicators for the company are as follows:

2023
2022
Gross profit margin (%)

33.5

28.5

Wages to turnover ratio

0.31

0.35



This report was approved by the board on 2 September 2024 and signed on its behalf.





P J Fanshawe
Director

C G Reed
Director

Page 1

 
BRAINTREE PRECISION COMPONENTS 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 judgments and accounting estimates that are reasonable and prudent;

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

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

Results and dividends

The profit for the year, after taxation, amounted to £903,838 (2022 - £23,764).

The directors do not propose a final dividend.

Directors

The directors who served during the year were:

G L Forster 
G P Forster 
B R Engstrom 
P J Fanshawe 
C G Reed 

Future developments

The directors are confident with the business proposition and place in the market. The company continues to invest heavily in plant and machinery.

Page 2

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial instruments

The principal financial instruments of the company comprise of trade and other debtors and creditors. The main purpose of these instruments is to raise funds for the company's operations. Liquidity risk is managed by ensuring sufficient funds are available to settle liabilities as and when they fall due.

Qualifying third party indemnity provisions

A fellow subsidiary on behalf of the group maintains liability insurance for its directors and officers against liabilities which directors or officers may incur personally as a consequence of claims made against them alleging breach of duty or unlawful acts of or omissions in their capacity as a director or officer.

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

The auditorsNyman Libson Paul LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 2 September 2024 and signed on its behalf.
 





P J Fanshawe
Director
C G Reed
Director

Page 3

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRAINTREE PRECISION COMPONENTS LIMITED
 

Opinion


We have audited the financial statements of Braintree Precision Components Limited (the 'company') for the year ended 31 December 2023, which comprise the Statement of Income and Retained Earnings, the Statement of Financial Position 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 profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


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


Conclusions relating to going concern


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


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


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


Page 4

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRAINTREE PRECISION COMPONENTS LIMITED (CONTINUED)


Other information


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


We have nothing to report in this regard.


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 2, 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 5

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRAINTREE PRECISION COMPONENTS 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:

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non- compliance with laws and regulations, we considered the following:
• the nature of the industry and sector, control environment and business performance;
• results of our enquiries of management about their own identification and assessment of the risks of irregularities;
• any matters we identified having obtained and reviewed the Company’s documentation of their policies and procedures relating to:
- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
- the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;
- the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in relation to timing of revenue recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the Company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and local tax legislation.
In addition, we considered other laws and regulations that could have an effect on the company and result in the imposition of financial or other penalties and litigation. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. These limited procedures did not identify actual or suspected non-compliance.
All matters in relation to non-compliance with laws and regulations and potential fraud risks were communicated to all members of the engagement team and we remained alert to any indications of non-compliance throughout the audit.

 
Page 6

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRAINTREE PRECISION COMPONENTS LIMITED (CONTINUED)


Our procedures to respond to risks identified included the following:
• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
• enquiring of management concerning actual and potential litigation and claims;
• assessing the appropriateness and where appropriate with third parties concerning actual and potential litigation and claims;
• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
• reading minutes of meetings of those charged with governance and correspondence with HMRC;
• in addressing the risk of fraud through management override of controls, reviewing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.


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.


Page 7

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRAINTREE PRECISION COMPONENTS LIMITED (CONTINUED)


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.





Paul Decker (Senior Statutory Auditor)
  
for and on behalf of
Nyman Libson Paul LLP
 
Chartered Accountants
Statutory Auditors
  
124 Finchley Road
London
NW3 5JS

4 September 2024
Page 8

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
10,487,613
8,060,828

Cost of sales
  
(6,969,847)
(5,760,282)

Gross profit
  
3,517,766
2,300,546

Distribution costs
  
(136,479)
(127,517)

Administrative expenses
  
(2,197,170)
(2,151,877)

Operating profit
  
1,184,117
21,152

Tax on profit
 8 
(280,279)
2,612

Profit after tax
  
903,838
23,764

  

  

Retained earnings at the beginning of the year
  
6,940,543
6,916,779

Profit for the year
  
903,838
23,764

Retained earnings at the end of the year
  
7,844,381
6,940,543

The notes on pages 11 to 22 form part of these financial statements.

Page 9

 
BRAINTREE PRECISION COMPONENTS LIMITED
REGISTERED NUMBER: 02367873

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 9 
4,846,580
3,743,929

  
4,846,580
3,743,929

Current assets
  

Stocks
 10 
3,273,986
2,940,372

Debtors: amounts falling due within one year
 11 
989,354
1,183,185

Cash at bank and in hand
 12 
480
500

  
4,263,820
4,124,057

Creditors: amounts falling due within one year
 13 
(251,123)
(233,186)

Net current assets
  
 
 
4,012,697
 
 
3,890,871

Total assets less current liabilities
  
8,859,277
7,634,800

  

Provisions for liabilities
  

Deferred tax
 14 
(994,896)
(674,257)

  
 
 
(994,896)
 
 
(674,257)

Net assets
  
7,864,381
6,960,543


Capital and reserves
  

Called up share capital 
 15 
20,000
20,000

Profit and loss account
  
7,844,381
6,940,543

  
7,864,381
6,960,543


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 2 September 2024.




P J Fanshawe
C G Reed
Director
Director

The notes on pages 11 to 22 form part of these financial statements.

Page 10

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Braintree Precision Components Limited ('the company') is a private company limited by shares and is incorporated and domiciled in England. The address of its registered office is 124 Finchley Road, London, NW3 5JS. The address of its principal place of business is 2-8 Blackwell Drive, Tamden Industrial Park, Off Springwood Drive, Springwood Industrial Estate, Braintree, Essex, CM7 2QJ.
The principal activities of the company are the manufacture and distribution of precision engineering components.

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 judgment 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 the company's ultimate parent undertaking, as disclosed in note 20 to these financial statements, as at 31 December 2023 and these financial statements may be obtained from the UK Companies House website:
https://find-and-update .company-information .service.gov.uk/.

Page 11

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Foreign currency translation

Functional and presentation currency

The company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised through profit or loss.

 
2.4

Revenue

Turnover comprises net invoiced sales of components for manufactured automated systems and other related products.
Revenue is recognised at the point of dispatch when it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
 
 
2.5

Operating leases: the company as lessee

Leases that do not transfer all of the risks and rewards of ownership are classified as operating leases. Payments under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

 
2.6

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 12

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.7

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. 
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 Statement of Financial Position 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. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.8

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.

The company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.

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.

The estimated useful lives range as follows:

Leasehold improvements
-
over the period of the lease
Plant and machinery
-
over 2 to 20 years
Motor vehicles
-
over 5 to 10 years
Fixtures and fittings
-
over 2 to 20 years

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.

Page 13

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.10

Debtors

Short term debtors are measured at transaction price, less any impairment.

 
2.11

Cash and cash equivalents

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

 
2.12

Creditors

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

Page 14

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.13

Financial instruments

The company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

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

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

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

Financial liabilities

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

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

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

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

Page 15

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgments, estimates and assumptions that affect the amounts reported for assets and liabilities as at the reporting date and the amounts reported for revenues and expenses during the year. It also requires management to exercise judgment in applying the company's accounting policies. As such, the nature of estimation means that actual outcomes could differ from those estimates. The following are the company's key sources of estimation uncertainty:
Tangible assets
Tangible assets are depreciated over their useful lives taking into account residual values where appropriate. The actual lives of assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing the assets' lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account.
Stock provisioning
The company manufactures precision engineering components and is subject to changing customer demands. As a result it is necessary to consider recoverability of the cost of stock and the associated provisioning required.
When calculating any stock provision, management considers the nature and condition of the stock as well as applying assumptions around anticipated saleability of the goods which are subject to market trends and forces.
Impairment of debtors
The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment, management considers factors including the current credit rating of the debtor, the ageing profile and historical experience.
Accruals
The company makes an estimate of accruals at the year end based on invoices received after the year end, work undertaken which has not been invoiced based on quotations or estimates of amounts that maybe due for payment.


4.


Turnover

The total turnover of the company for the year has been derived from its principal activity wholly undertaken in the United Kingdom.


5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Other operating lease rentals
361,149
315,058

Page 16

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Auditors' remuneration

2023
2022
£
£

Fees payable to the company's auditors for the audit of the company's financial statements
13,500
10,500

The company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent company.


7.


Employees

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
2,844,587
2,437,359

Social security costs
258,801
234,838

Cost of defined contribution scheme
112,430
98,571

3,215,818
2,770,768


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


        2023
        2022
            No.
            No.







Production
75
68



Administration
12
10

87
78

Page 17

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Taxation


2023
2022
£
£



Group taxation relief
(40,360)
(243,240)


Total current tax
(40,360)
(243,240)

Deferred tax


Origination and reversal of timing differences
320,639
240,628

Total deferred tax
320,639
240,628


Taxation on profit/(loss) on ordinary activities
280,279
(2,612)

Factors affecting tax charge for the year

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

2023
2022
£
£


Profit on ordinary activities before tax
1,184,117
21,152


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.5% (2022 - 19%)
278,511
4,019

Effects of:


Expenses not deductible for tax purposes
147
(117)

Capital allowances for year in excess of depreciation
(97)
(6,504)

Loss/(profit) on disposal of fixed assets
1,718
(10)

Group relief
40,360
243,240

Compensation for group relief
(40,360)
(243,240)

Total tax charge for the year
280,279
(2,612)


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 18

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Tangible fixed assets





Leasehold improvement
Plant and machinery
Motor vehicles
Fixtures and fittings
Total

£
£
£
£
£



Cost or valuation


At 1 January 2023
112,177
7,800,794
4,754
88,250
8,005,975


Additions
-
1,652,980
-
-
1,652,980


Disposals
-
(26,963)
-
-
(26,963)



At 31 December 2023

112,177
9,426,811
4,754
88,250
9,631,992



Depreciation


At 1 January 2023
53,305
4,141,801
4,754
62,186
4,262,046


Charge for the year on owned assets
6,926
534,015
-
2,079
543,020


Disposals
-
(19,654)
-
-
(19,654)



At 31 December 2023

60,231
4,656,162
4,754
64,265
4,785,412



Net book value



At 31 December 2023
51,946
4,770,649
-
23,985
4,846,580



At 31 December 2022
58,872
3,658,993
-
26,064
3,743,929


10.


Stocks

2023
2022
£
£

Raw materials and consumables
817,275
616,540

Work in progress
536,459
556,308

Finished goods and goods for resale
1,920,252
1,767,524

3,273,986
2,940,372


The carrying value of stocks are stated net of impairment losses due to slow-moving and obsolete stock totalling £621,242 (2022 - £618,729). Impairment losses totalling £2,513 (2022 - £138,583) were recognised in profit and loss.

Page 19

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Debtors

2023
2022
£
£


Trade debtors
600
-

Amounts owed by group undertakings
459,361
348,535

Prepayments and accrued income
529,393
834,650

989,354
1,183,185



12.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
480
500

480
500



13.


Creditors: Amounts falling due within one year

2023
2022
£
£

Other taxation and social security
73,806
69,625

Accruals and deferred income
177,317
163,561

251,123
233,186


Page 20

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Deferred taxation




2023


£






At beginning of year
(674,257)


Charged to profit or loss
(320,639)



At end of year
(994,896)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(1,000,158)
(679,032)

Other timing differences
5,262
4,775

(994,896)
(674,257)


15.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



80,000 (2022 - 80,000) Ordinary shares of £0.25 each
20,000
20,000



16.


Capital commitments

[At the reporting date, the company had capital commitments of £1,172,697 (2022: £1,416,858). The amount contracted for but not provided in these financial statements was £686,614 (2022: £658,309).]


17.


Pension commitments

At the reporting date, there was an amount of £21,047 (2022: £19,102) outstanding in respect of pension contributions payable by the company. This amount is included in creditors.
Contributions payable by the company during the year were £112,430 (2022: £98,571).

Page 21

 
BRAINTREE PRECISION COMPONENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


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
1,538
2,969

1,538
2,969


19.


Related party transactions

The company has taken advantage of the exemption provided by "Financial Reporting Standard 102" not to disclose transactions with other entities wholly owned within the group, including its parent and fellow subsidiary undertakings.


20.


Controlling party

The ultimate parent company is Hepco (Holdings) Limited, a company incorporated and domiciled in England, which is controlled by Mr G L Forster.
The address of Hepco (Holdings) Limited's registered office is 124 Finchley Road, London, NW3 5JS and its consolidated financial statements may be obtained from the UK Companies House website: https://find-and-update .company-information .service.gov.uk /.

 
Page 22