Company registration number: 01847467
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COMPANY INFORMATION
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CONTENTS
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STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their strategic report for the year ended 31 December 2023.
Business Review
The directors aim to provide a balanced and comprehensive review of the development and performance during the year and position at the year end. This review is consistent with the size and nature of our business and is written in the context of the risks and uncertainties faced by the business. The principal activity of the Company is the continued sale and rental of state-of-the-art audio equipment along with audio expertise, sound engineers and technicians to a range of markets, including the events and international touring. Britannia Row continues to work closely with related companies in the Clair Group’s expanding global network.
The Company experienced unprecedented growth in 2023. Turnover increased by 62.9%, compared to the prior year, to £41.5M. This substantial increase was contributed to by the acquisition of Skan PA Hire in late 2022 and the transfer of trade from Eighth Day Sound UK from 1st of January 2023. The management staff and directors from all three companies have continued to prioritise integrating their teams, sharing resources, skills, training, and experience to strengthen the individual and group brands.
The gross profit margin was 35.1% for the year ended 31 December 2023 compared to 37.3% for the previous year. One of the main reasons for the reduced margin was due to an increase in depreciation on audio equipment. Due to unpredictable manufacturer lead times and increased customer demand, the decision was made to significantly increase investment in audio equipment in 2023. As a result, the Group was able to reduce freight movements and other costs. The gross margin was also impacted by an increase in staff numbers, due to the highly competitive job market, recruitment was slow in 2022, and continued into 2023, resulting in a 34% increase to employee numbers by the end of the year. Britannia Row continues to promote equal opportunities and the directors note positive change in diversity of the workforce in recent years. The 2023 Profit before Tax was £6.0M compared to £3.5M for the previous year, a 69.5% increase. This resulted in a £5.8M improvement on the Company EBITDA, when comparing 2023 and 2022. Despite the increase to the long-term creditors balance, net assets followed the same trend rising from £4.8M in to £9.4M. The Board regularly monitors the Company’s financial performance against the following Key Performance Indicators. Turnover £41.5m Gross Profit Margin 35.1% EBITDA £11.8m
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The risks faced by the Company are reviewed by the board on a regular basis and appropriate processes are put in place to monitor and mitigate these, however the directors recognise that the Company, as any other business, is subject to risks and uncertainties that are beyond its control.
The pandemic and war in Ukraine have an ongoing impact on supply chain resulting in unpredictable manufacturer lead times, in addition, Brexit continues to affect the availability of skilled technical labour. The war in the Middle East can require additional logistics planning. The Company is fortunate to be part of a Global Group, and thus can reduce these risks by sharing resources with related group companies. Other keys risks that could impact on the future of the business are: - Exchange Rate Fluctuations This financial risk is managed by quoting international tours in the applicable currency and managing multiple currency bank accounts. - Interest Rates The directors manage the cost of borrowing by careful financial planning and controlling the timing of capital expenditure. - Health & Safety The Company regularly reviews its strict Health and Safety procedures and has a dedicated Health and Safety manager who ensures that the team are trained accordingly. - Cyber Security The Company enforces IT security measures, such as multi-factor authentication and provides regular cyber security awareness training.
The Company continues to collaborate with related companies in the Clair Global Group to improve on global synergies and standardisation of processes, with the goal of exceeding customer expectations. In 2024, the Clair UK companies plan to consolidate operations into one building, which will reduce costs and improve efficiencies. In addition, the Group continues to work on standardisation of equipment, to ensure consistent quality services globally.
This report was approved by the board and signed on its behalf by.
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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 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 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.
The profit for the year, after taxation, amounted to £4,582,668 (2022 -£2,939,208).
The directors have not recommended a dividend.
The directors who served during the year were:
Information on future developments is covered in the Strategic Report.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The Company signed a new lease agreement for the existing office premises on 1 February 2024 as disclosed in note 27.
Ernst & Young LLP were appointed as auditors during the year. Under the section 487 (2) of the Companies House Act of 2006, Ernst & Young 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 register, whichever is earlier.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRITANNIA ROW PRODUCTIONS LIMITED
We have audited the financial statements of Britannia Row Productions 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 Cash Flows and the related notes 1 to 28, 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 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (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. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Company’s ability to continue as a going concern.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRITANNIA ROW PRODUCTIONS LIMITED (CONTINUED)
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.
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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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRITANNIA ROW PRODUCTIONS 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 risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
∙We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are those that relate to the reporting framework (FRS 102 and Companies Act 2006) and the relevant direct and indirect tax compliance regulation in the United Kingdom. In addition, the Company has to comply with laws and regulations relating to its operations including health and safety and the Data Protection Act 2018.
∙We understood how Britannia Row Productions Limited is complying with those frameworks by making enquires of management and those charged with governance to gain an understanding of entity level controls including how the Company maintains and communicates its policies and procedures in these areas. We corroborated our enquires through a review of policies, meeting minutes and any correspondence received from regulatory bodies.
∙We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur through inquiry of management and those charged with governance as to established policies and procedures that exist, as well as reading internal policies relating to revenue recognition and related party transactions. We considered the procedures and controls that the Company has established to address risks identified, or that otherwise prevent, deter and detect fraud and gained an understanding as to how these procedures and controls are implemented and monitored.
∙Based on this understanding we designed our audit procedures to identify noncompliance with such laws and regulations. Our procedures included verifying that material transactions are recorded in compliance with FRS 102 and where applicable Companies Act 2006. Compliance with other operational laws and regulations was covered through inquiry with management, reading of the board meeting minutes and correspondence with the relevant authorities with no indication of non-compliance identified.
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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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BRITANNIA ROW PRODUCTIONS 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 Ernst & Young LLP, Statutory Auditor
Date:
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STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023
* A prior year adjustment has been made to reduce stock by £605,216 and cost of sales by £58,295 as at 31 December 2022. Please see note 23 for more information.
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STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 14 to 28 form part of these financial statements.
* A prior year adjustment has been made to reduce stock by £605,216 and cost of sales by £58,295 as at 31 December 2022. Please see note 23 for more information.
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STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
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STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
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ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
Britannia Row Productions Limited is a private company, limited by shares and incorporated in England and Wales. The address of the registered office is 104 The Green, Twickenham, London, TW2 5AG.
The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented unless otherwise stated.
2.Accounting policies
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:
At the year end the Company had net assets of £9,365,652 increased from £4,782,984 (restated) as at 31 December 2022. For at least the next 12 months from the date of these financial statements, due to the continued support of the parent Company and cash generated from operations, the directors have a reasonable expectation that the Company has adequate resources to continue operational existence. For this reason the directors continue to adopt the going concern basis of accounting in preparing the annual financial statements.
Functional and presentation currency
Transactions and balances
Revenue arising from the supply of audio equipment, engineers and technicians is recognised at the point of supply. Where services are invoiced in advance, revenue is deferred and released on fulfillment of the contracted services. Revenue arising from the sale of new and used audio equipment is recognised on despatch to the customer, which is considered to be the point at which the risks and rewards of ownership transfer to the customer.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of the future payments is treated as a liability.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a mixture of straight line and reducing balance basis.
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.
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is written off. The impairment loss is recognised immediately in profit or loss.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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.
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.
A key area of judgement and estimation affecting these financial statements is: Tangible assets Management are required to estimate the expected useful economic life and expected residual value of the Company's fixed assets in order to apply an appropriate accounting policy for the Company's audio equipment. The depreciation policies are detailed in note 2.11. The accounting policy affects the net book value of the tangible assets, which coincides with the revenue generated on the profit or loss on disposals. Intangible assets Intangible assets are reviewed annually for indicators of impairment by reference to the financial performance of the relevant business units against forecast. Where performance falls short of forecast, the reasons for this are considered by management alongside actual and forecast post year end performance. Where this is considered to be indicative of potential impairment, an adjustment may be made to the carrying value of the related balances. In judging whether impairment exists and calculating the recoverable value of the assets, management take into account their knowledge and understanding of the operations of each business unit as well as their wider industry expertise.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
13.Taxation (continued)
Changes to the UK Corporation tax rates were substantively enacted on 24 May 2021 to increase the main rate of Corporation tax to 25% from 1 April 2023.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
Profit and loss account
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
During the process of preparing the current year's financial statements the directors reviewed the Company's policy for recognising certain consumables used in providing its services as inventory. It was concluded that, these were incorrectly recognised as inventory and therefore taking into account the nature of these consumables and the rate of which these are used in the business, these items will be expensed purchased. Accordingly, there was a correction in relation to the recognition of stock, which was actioned in order to align the accounting standards and the Group's accounting policies. As such a prior year adjustment has been made to reduce stock by £605,216 and cost of sales by £58,295 as at 31 December 2022.
The effect of these entries is to reduce the brought forward balance as at 1 January 2022 in retained earnings of £2,507,047, reduce stock of £672,146 by £632,756 for each line item respectively.
The Company's assets are pledged as security over group borrowings by means of fixed and floating charges and negative pledges held by PNC Bank, National Association. The directors do not anticipate that the Company will incur any future liabilities as a result of these charges.
The Company operates defined contribution pension schemes. The assets of the schemes are held separately from those of the Company in independently administered funds. The pension cost charge represents contributions payable by the Company to the funds and amounted to £312,608 (2022 - £184,163). At 31 December 2023 contributions totalling £37,386 (2022 - £30,414) were payable to the Company's pension funds at the balance sheet date.
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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023
The immediate parent company is Lititz Holdings Limited which is registered in the Republic of Ireland.
The ultimate parent company is Clair Global Family Holdings LLC, which is registered in the United States of America. The results of the Company are included in the consolidated financial statements for Clair Global Corp., a company registered in the United States of America whose registered address is One Ellen Avenue, Lititz, PA 17543, United States. This is the largest and smallest group of undertakings for which consolidated financial statements are available.
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