Company Registration Number
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SCHAEFFLER (UK) LIMITED
COMPANY INFORMATION
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SCHAEFFLER (UK) LIMITED
CONTENTS
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SCHAEFFLER (UK) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their Strategic report and the financial statements for the year ended 31 December 2023.
The principal activities of the Company during 2023 were the manufacture of clutch assemblies for the passenger car and agricultural tractor industries, and the sale of anti-friction bearings and precision components to the industrial sector.
Turnover in 2023 shows an overall increase of 1%, comprising the Automotive Technologies division decrease of 2.1% and the Industrial division increase of 9.7%. The result before tax decreased to 1% of sales in 2023 from 6.9% of sales in 2022, principally due to one-off exceptional price increases for materials and components. Control of working capital and cash flow management were key measurables during 2023 and will continue to be a priority during 2024. Working capital reduced significantly during 2023 due to improved stock management and debtor collection activities.
The level of trading at the Sheffield Plant reduced marginally by 1% compared to 2022 and the customer base continued to develop with an increased supply to the automotive aftermarket sector.
The Automotive and Industrial Divisions both maintained consistency with previous years in terms of quality achievements and delivery performance. High quality, dedicated customer service and innovative product development continue to underpin the business.
The Company will continue to work on projects in a variety of industry sectors including automotive, renewable energy, marine, and oil and gas, and investment continues at comparable levels to previous years. The programme of team leader training continued to drive efficiency improvements during the year by adopting best practice models. The Company continues to invest in new activities to support new products, materials and processes with the aim of providing leading edge products and services to all market sectors.
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SCHAEFFLER (UK) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Risks are formally reviewed by the senior executive team and appropriate processes put in place to monitor and mitigate them.
Cash flow risk
Detailed cash flow forecasts are prepared monthly with the objective of alerting senior management to potential future risks. The Company operates its banking facilities within a Group Cash Pooling arrangement mitigating the effects of liquidity risks.
Credit risk
Credit risk is the financial exposure generated by the potential default of third parties in fulfilling their obligations. Credit risk arises for the Company if it is unable to recover sums due from customers and it is mitigated by rigorous credit control, credit insurance where appropriate, and the regular review of credit limits utilising data from credit agencies and the Company's own financial and marketing intelligence.
Currency risk
The Company faces currency risk on its currency transaction flows with customers and suppliers. It mitigates the risk by internal hedging and the use of the Group currency pooling arrangement.
Competition risk
The Company operates in a competitive market and must carefully monitor the quality and price of its services. In order to mitigate this risk, we work in close partnership with our customers on the design and development of new products, providing solutions to their problems and continually raising our quality goals.
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SCHAEFFLER (UK) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Directors' Duties
The directors of the Company, as those of all UK companies, must act in accordance with a set of general duties. These duties are detailed in section 172 of the UK Companies Act 2006 as follows:
A director of a company must act in the way they consider, in good faith, would be the most likely to promote the success of the Company for the benefit of its shareholders as a whole and, in doing so have regard (amongst other matters) to:
∙the likely consequences of any decisions in the long-term.
∙the interests of the Company's employees.
∙the need to foster the Company's business relationships with suppliers, customers and others.
∙the impact of the Company's operations on the community and environment.
∙the desirability of the Company maintaining a reputation for high standards of business conduct, and
∙the need to act fairly as between shareholders of the Company.
The board of directors of Schaeffler (UK) Limited consider individually and together that they have acted in the way they consider in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole (having regard to shareholders and matters set out in section 172(1) of the Act) in the decisions taken during the year ended 31 December 2023.
Examples of how the directors have oversight of stakeholder matters and have regard for these matters when making decisions are set out in the table below.
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SCHAEFFLER (UK) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Board meetings are held during which relevant strategic, governance and performance issues are discussed and addressed in accordance with the requirements of the Act.
All matters discussed, and decisions made, are done so with consideration to the impact on Company
stakeholders in line with the requirements of Section 172 of the Companies Act. The directors are reminded of this requirement at each meeting.
The Company is committed to being a responsible business. Our behaviour is aligned with the expectations of our people, clients, investors, communities and society as a whole. People are at the heart of what we do and for our business to succeed we manage our people's performance and develop them through a variety of training, learning and efficiency programmes. All staff members work to the common values of the Company which inform and guide behaviours, that ensure we reach our goals in a structured and professional way. A Company-wide culture has been introduced to ensure a common understanding and application of our people's behaviours and ethics in everything we do. Regular staff meetings, feedback forums, townhall meetings and social events take place to ensure our people feel they are valued, as well as adding value to what we do.
Our strategy prioritises organic growth, driven by bringing new prospective business to the Company, as well as introducing new products and services to existing customers. To do this we have to continuously develop and maintain strong client relationships. We value all of our suppliers and have multi-year contracts and longstanding relationships with our key suppliers.
Regular review meetings and dialogue ensure our partners are fully engaged in supporting the success of the business.
The Company's approach is to use its position to create positive change for the people and communities with which we interact. We actively encourage our colleagues to support the communities around us and we continue to look to support future initiatives that can improve the communities and environments we work in.
The Board is committed to openly engaging with our shareholders, as we recognize the importance of a continuing effective dialogue so that all parties understand our strategy and business objectives.
These are explained clearly, feedback is encouraged, and any issues or questions raised are properly considered. Shareholder meetings are held as well as several less formal interactions and dialogue sessions aimed at ensuring a common understanding of the collective aims of the members.
This report was approved by the board and signed on its behalf.
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SCHAEFFLER (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.
The profit for the year, after taxation, amounted to £631,000 (2022: £6,850,000).
The directors do not recommend a final dividend (2022: £nil).
The directors who served during the year were:
The Company implements a programme of continuous improvement in environmental health and safety activities.
The Company operates to ISO 45001 Safety Standard and the environmental standards EMAS, ISO 14001 and the Energy Management standard ISO 50001. The Company is dedicated to raising the profile of engineering and manufacturing through membership of Make UK, the SMMT and CIPD. As well as industrial links, the company has links with various universities and further education colleges.
The Company will continue to work on projects in a variety of industry sectors including automotive, oil and gas, and investment continues at comparable levels to previous years. The programme of team leader training continued to drive efficiency improvements during the year by adopting best practice models. The Company continues to invest in research and development to support the launch of new products, materials and processes with the aim of providing leading edge products and services to all market sectors.
The Company monitors employee satisfaction through employee surveys and also indirectly through its main departmental measures of staff turnover and absence levels.
The Company continues to invest in its Apprenticeship Programme, a scheme that has been in place for over 50 years.
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SCHAEFFLER (UK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Quantification and reporting methodology
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol - Corporate Standard and have used the 2023 UK Government's Conversion Factors for Company Reporting. Intensity measurement The chosen intensity measurement ratio is total gross emissions in tonnes of CO2e per £1,000 turnover. Energy Efficiency Action Taken: Since 2019, our electricity is sourced from 100% REGO-Backed renewables. We have converted existing lighting in the plant and offices to Energy Efficient LED lighting with motion control wherever possible to lower energy usage for lighting. This is expected to save 285,000 kWh per year in the plant and 31,500 kWh per year in the offices. We have introduced a program for detecting and repairing air leaks in the compressed air systems, reducing the amount of compressed air produced and therefore the usage of electricity. This is expected to save over 1.5 GWh over the next 10 years. It is now company policy to allow working from home and to use video-conferencing where possible for internal and external meetings. This has reduced commuting, national and international travel significantly. The fleet of company cars are being changed from Diesel to Petrol Hybrid Cars or fully electric. 93% of the fleet is already transferred to the Petrol Hybrid or fully electric, significantly reducing CO2 and particulate emissions. 6 EV charging points have now been installed. The Compressed Air system pressure has been reduced from 7 bar to 6 bar. This should give a saving of 7% of air produced, further reducing electricity consumed.
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SCHAEFFLER (UK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The auditors, Armstrong Watson Audit Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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SCHAEFFLER (UK) LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
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 101 ‘Reduced Disclosure Framework’. 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 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 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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SCHAEFFLER (UK) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SCHAEFFLER (UK) LIMITED
We have audited the financial statements of Schaeffler (UK) Limited (the 'Company') for the year ended 31 December 2023, which comprise the Income statement, the Statement of comprehensive income, the Statement of financial position, the Statement of changes in equity and the related notes, including a summary of 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 101 ‘Reduced Disclosure Framework’ (United Kingdom Generally Accepted Accounting Practice).
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.
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.
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.
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SCHAEFFLER (UK) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SCHAEFFLER (UK) LIMITED (CONTINUED)
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.
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.
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SCHAEFFLER (UK) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SCHAEFFLER (UK) LIMITED (CONTINUED)
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:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non compliance with laws and regulations, was as follows:
∙We obtained an understanding of laws and regulations that affect the Company, focusing on those that had a direct effect on the financial statements or that had a fundamental effect on its operations. Key laws and regulations that we identified included the Companies Act 2006, FRS101, tax legislation and employment legislation.
∙We enquired of the directors, reviewed correspondence with HMRC and reviewed directors meeting minutes for evidence of non-compliance with relevant laws and regulations.
∙We also reviewed controls the directors have in place to ensure compliance.
∙We gained an understanding of the controls that the directors have in place to prevent and detect fraud. We enquired of the directors about any incidences of fraud that had taken place during the accounting period.
∙The risk of fraud and non-compliance with laws and regulations and fraud was discussed within the audit team and tests were planned and performed to address these risks. We identified the potential for fraud in the following areas: management override of controls and revenue recognition.
∙We reviewed financial statements disclosures and tested to supporting documentation to assess compliance with relevant laws and regulations discussed above
∙We enquired of the directors and third-party advisors about actual and potential litigation and claims.
∙We performed analytical procedures to identify any unusual or unexpected relationships that might indicate risks of material misstatement due to fraud.
∙In addressing the risk of fraud due to management override of internal controls we tested the appropriateness of journal entries and assessed whether the judgements made in making accounting estimates were indicative of a potential bias.
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.
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SCHAEFFLER (UK) LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SCHAEFFLER (UK) LIMITED (CONTINUED)
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an 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.
for and on behalf of
Chartered Accountants
Statutory Auditors
Leeds
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SCHAEFFLER (UK) LIMITED
INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
REGISTERED NUMBER: 00556493
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
REGISTERED NUMBER: 00556493
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 18 to 44 form part of these financial statements.
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SCHAEFFLER (UK) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Schaeffler (UK) Limited is a private company limited by shares, incorporated in England and Wales and domiciled in the UK.
2.Accounting policies
The preparation of financial statements in compliance with FRS 101 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:
The Company has taken advantage of the following disclosure exemptions under FRS 101:
∙the requirements of IFRS 7 Financial Instruments: Disclosures
∙the requirement in paragraph 38 of IAS 1 'Presentation of Financial Statements' to present comparative information in respect of:
- paragraph 73(e) of IAS 16 Property, Plant and Equipment;
- paragraph 118(e) of IAS 38 Intangible Assets;
∙the requirements of IAS 7 Statement of Cash Flows
∙the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member
This information is included in the consolidated financial statements of Schaeffler AG as at 31 December 2023 and these financial statements may be obtained from Schaeffler group website.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons.
The company is profitable and generates positive net cash flows from operating activities. It meets its day to day working capital requirements from a group funding facility comprising a loan facility of £50m and a cash pooling facility of £10m, which were drawn to the extent of £36m and £1.4m at 31 December 2023. The loan had reduced to £26m at the date of approval of the financial statements. The directors have prepared profit and cash flow forecasts for the company through to October 2025 which indicate that, taking account of reasonably possible downsides including a slowdown of the economy and a cost of living crisis with regard to inflation and energy costs, the company will have sufficient funds to meet its liabilities as they fall due for that period, with substantial headroom available in terms of undrawn amounts on the group funding facility. The directors also prepared a heavily sensitised downside case, in which the company could require additional borrowings in addition to the current facility limits. The directors have no reason to believe that the parent company Schaeffler AG would not continue to provide financial support to the company if that heavily sensitised downside case arose, for at least the period of twelve months from the date of approval of these financial statements. As with any company placing reliance on other group entities for financial support, the directors acknowledge that there can be no certainty that this support will continue although, at the date of approval of these financial statements, they have no reason to believe that it will not do so. Consequently, the directors are confident that the company will have sufficient funds to continue to meet its liabilities as they fall due until at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.
Functional and presentation currency
Transactions and balances
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The estimated useful lives range as follows:
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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:
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.
Costs incurred in bringing each product to its present location and condition are determined on a first in first out basis and comprise purchase cost, cost of direct material and labour and a proportion of manufacturing overheads based on normal operating capacity but excluding borrowing costs. Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
The Company recognises financial instruments when it becomes a party to the contractual arrangements of the instrument. Financial instruments are de-recognised when they are discharged or when the contractual terms expire. The Company's accounting policies in respect of financial instruments transactions are explained below:
Financial assets and financial liabilities are initially measured at fair value.
Financial assets
All recognised financial assets are subsequently measured in their entirety at either fair value or amortised cost, depending on the classification of the financial assets.
Fair value through profit or loss
Impairment of financial assets
Financial liabilities
Fair value through profit or loss
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
At amortised cost
The most significant accounting estimates in the financial statements are: Defined benefit scheme (note 26) The surplus arising in relation to the defined benefit pension scheme has been recognised in full on the balance sheet. This is based on the Director's assessment that an economic benefit, in the form of a refund, is available at the end of the pension plan's life, once the plan liabilities are settled.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Analysis of turnover by country of destination:
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
10.Taxation (continued)
There were no factors that may affect future tax charges.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
13.Tangible fixed assets (continued)
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Other reserves
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The Company operated a funded final salary pension scheme providing benefits based on final pensionable pay. On 1 December 2005, the scheme merged with other schemes for companies under common control to form Schaeffler (UK) Pension Scheme. The scheme provides benefits based on final pensionable pay. The assets of the scheme are held separately from those of the Company and are invested in managed funds.
At 31 December 2009, the defined benefit pension scheme for the UK Group was closed to all active members. The members of the scheme transferred to a stakeholder scheme and their entitlement under the defined benefit scheme was frozen. During the year to 31 December 2019, liabilities from a former group company were transferred to Schaeffler (UK) Limited by way of an apportionment arrangement agreed between the parties and the scheme. Part of the liabilities transferred are in an unfunded arrangement which is detailed in the accounts. At the end of year to 31 December 2023 the unfunded arrangement had a balance of £321,000 (2022: £327,000) in respect of pension benefits due but not funded for in an approved arrangement. The disclosures below exclude these liabilities. The Company also operates a defined contribution scheme for which contributions payable are charged to the income statement. In the year ended 31 December 2023, there is a charge in the income statement in respect of the defined contribution scheme of £853,089 (2022: £836,370). Contributions outstanding for the schemes amounted to £119,411 at the year-end (2022: £119,917). IAS19: Employee Benefit The disclosures required under IAS19 Employee Benefits have been calculated by the qualified independent actuary based on the results of the formal actuarial valuation at 31 December 2020. The valuation resulted in a surplus of £53.3m at 31 December 2020, comprising Technical Provisions of £202.3m and Scheme assets of £255.6m. As the Scheme is in surplus no deficit reduction contributions are required. The next triennial valuation on a technical provision basis, effective as at 31 December 2023 is due later in 2024.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
26.Pension commitments (continued)
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
26.Pension commitments (continued)
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
26.Pension commitments (continued)
The calculation of the defined benefit obligation is sensitive to the assumptions set out above. The following table summarises how the defined benefit obligation at the end of the reporting period would have increased / (decreased) as a result of a change in the respective assumptions by one percent.
2023 2022 £'m £'m Discount rate increase (+1.00%) (14.75) (16.43) Discount rate decrease (-1.00%) 18.18 18.99 Future pension increase (+1.00%) 11.38 8.86 Future pension decrease (-1.00%) (9.82) (9.17) In valuing the liabilities of the pension fund at 31 December 2023, mortality assumptions have been made as indicated above. Funding The Company expects to pay no contributions to its defined benefit plans in 2023. The weighted average duration of the defined benefit obligation at the end of the reporting period is 12.78 years (2022: 15.52 years). The surplus arising in relation to the defined benefit pension scheme has been recognised in full on the balance sheet. This is based on the Director's assessment that an economic benefit, in the form of a refund, is available at the end of the pension plan's life, once the plan liabilities are settled. Methodology As at 31 December 2023 and 31 December 2022, the methodology for calculating the RN inflation assumption used the full RPI inflation yield curve, taking account of the profile of the scheme's liabilities.
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SCHAEFFLER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
CPI
For CPI, the methodology has used the assumption for RPI inflation with a deduction of 0.65% per annum to reflect the expected long-term difference between RPI and CPI. In the previous year the same assumptions and rate were used.
Schaeffler (UK) Limited and its subsidiaries are part of the Schaeffler Group of companies.
The largest group for which consolidated financial statements are publicly available is the group headed by Schaeffler AG. The ultimate parent of the group is INA-Holding Schaeffler GmbH & Co.KG, Industriestraße 1-3, Herzogenaurach, 91074, Germany, registered in Germany. The ultimate controlling party is Frau M-E Schaeffler-Thumann and Herr G.F.W. Schaeffler.
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