Company registration number 09531189 (England and Wales)
SRJ TECHNOLOGY LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
SRJ TECHNOLOGY LIMITED
CONTENTS
Page
Statement of financial position
1
Notes to the financial statements
2 - 8
SRJ TECHNOLOGY LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
3
81,475
95,054
Tangible assets
4
10,407
17,403
91,882
112,457
Current assets
Stocks
1,457
1,457
Debtors
5
90,033
74,583
Cash at bank and in hand
2,026
22,111
93,516
98,151
Creditors: amounts falling due within one year
6
(3,088,188)
(2,453,594)
Net current liabilities
(2,994,672)
(2,355,443)
Total assets less current liabilities
(2,902,790)
(2,242,986)
Capital and reserves
Called up share capital
7
1
1
Share premium account
11,608
11,608
Profit and loss reserves
(2,914,399)
(2,254,595)
Total equity
(2,902,790)
(2,242,986)
For the financial year ended 31 December 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 18 September 2024 and are signed on its behalf by:
Roger Smith
Director
Company Registration No. 09531189
The notes on pages 2 to 8 form part of these financial statements.
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
1
Accounting policies
Company information
SRJ Technology Limited is a private company limited by shares incorporated in England and Wales. With effect from 12 October 2020, the registered office is Unit 2, Waterside House, Satchell Lane, Port Hamble, Southampton, Hampshire, United Kingdom, SO31 4QD.
The principal activity of the company is developing and distributing a range of weld-free coupling and leak containment solutions for pipeline and process pipework systems and leak containment solutions. The Company also offers Asset Integrity Management consulting services to help asset owners develop and implement an effective asset integrity strategy.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention.
The principal accounting policies adopted are set out below.
1.2
Going concern
The Company made a loss of £659,804 for the year (2022: £730,862) and as at 31 December 2023 was in a net liability position of £2,902,790 (2022: £2,242,986).true
The Parent, SRJ Technologies Group plc (the "Group"), provides ongoing financial support for the operating activities of the Company and there is a reasonable expectation that this will continue.
Given the above, the Directors believe that the Company will have adequate resources to continue in operational existence for at least the twelve month period following the approval of these financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 3 -
1.4
Research and development expenditure
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which is estimated to be 13 years from the date in which production and sale of the product commenced.
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.
1.5
Intangible fixed assets other than goodwill
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
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 10 years.
The patents and development costs first became available for use in 2017 when production and sale of the product commenced. They are being amortised annually on a straight line basis up to 20 October 2029 which is the maximum duration the main patent application can be extended to. The basis for this amortisation is up to 13 years (from 2017 - 2029).
The patents and development costs residual values, useful lives and amortisation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Patents
Straight line up to 13 years
Development expenditure
Straight line up to 13 years
1.6
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
20% reducing balance
Office equipment
20% reducing balance
Computer equipment
33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ 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.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
1.11
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
1.14
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
5
6
3
Intangible fixed assets
Patents
Development expenditure
Total
£
£
£
Cost
At 1 January 2023 and 31 December 2023
6,318
140,483
146,801
Amortisation and impairment
At 1 January 2023
2,296
49,451
51,747
Amortisation charged for the year
574
13,005
13,579
At 31 December 2023
2,870
62,456
65,326
Carrying amount
At 31 December 2023
3,448
78,027
81,475
At 31 December 2022
4,022
91,032
95,054
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
4
Tangible fixed assets
Plant and equipment
Office equipment
Computer equipment
Total
£
£
£
£
Cost
At 1 January 2023 and 31 December 2023
23,327
4,706
12,593
40,626
Depreciation and impairment
At 1 January 2023
9,918
2,831
10,474
23,223
Depreciation charged in the year
4,665
941
1,390
6,996
At 31 December 2023
14,583
3,772
11,864
30,219
Carrying amount
At 31 December 2023
8,744
934
729
10,407
At 31 December 2022
13,409
1,875
2,119
17,403
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
31,676
35,653
Other debtors
58,357
38,930
90,033
74,583
6
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
19,516
3,754
Amounts owed to group undertakings
2,975,711
2,419,156
Taxation and social security
83,529
21,289
Other creditors
9,432
9,395
3,088,188
2,453,594
Amounts owed to group undertakings
The amounts owed to SRJ Technologies Group Plc and SRJ Limited (see note 8) are for the long term financing of the Company to assist in paying operating expenses. The amounts due are unsecured, interest free and without a fixed repayment date, although they are not expected to be repaid in the short term.
SRJ TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
7
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1
1
1
1
8
Related party transactions
The Company has received loans from SRJ Limited, a fellow subsidiary of the Parent, SRJ Technologies Group Plc. During the year, the Company received net loans of £32,927 (2022: £3,456) from SRJ Limited. The balance owing by the Company to SRJ Limited as at 31 December 2023 was £42,333 (2022: £9,406).
SRJ Technologies Group Plc is the parent of the Company, owning 100% of the issued share capital. During the year, the Company received net loans of £523,628 (2022: £664,617) from SRJ Technologies Group Plc to support its ongoing operations. The balance owing by the Company to SRJ Technologies Group Plc as at 31 December 2023 was £2,933,378 (2022: £2,409,750). The loan is unsecured, interest free and repayable on demand, although the Directors of the Parent have no current intention of recalling the loan within the next twelve months.
9
Ultimate controlling party
The immediate parent undertaking is SRJ Technologies Group Plc, a company incorporated in Jersey, Channel Islands. Its registered office is Le Quai House, Le Quai d' Auvergne, St Helier, Jersey, JE2 3TN.
10
Events after the reporting date
Subsequent events have been evaluated up to the date that the financial statements were approved and authorised for issue by the Board of Directors. There have been no material events requiring disclosure in these financial statements.