WAA Chosen Limited
Annual Report and Financial Statements
For the year ended 31 December 2023
Company Registration No. 03477643 (England and Wales)
WAA Chosen Limited
Company Information
Directors
A M Wilson
J A Lennon
Secretary
R J Dainter
Company number
03477643
Registered office
Wrens Court 58 Victoria Road
Sutton Coldfield
West Midlands
B72 1SY
Auditor
Moore Kingston Smith LLP
Charlotte Building
17 Gresse Street
London
W1T 1QL
WAA Chosen Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 28
WAA Chosen Limited
Strategic Report
For the year ended 31 December 2023
Page 1

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

Fair review of the business

2023 was a year of investment for the agency, in terms of our product, our clients and our people.

 

From a product perspective the agency, in line with the business plan, there’s been a substantial increase in our digital and technology offering, with additional experts joining the team, and the in-house development and rollout of its RITA (Real-time Information Transfer Architecture) platform. This proprietary software was key in winning additional accounts for, initially, automotive brands where it processes and handles millions of pieces of contemporaneous data, reducing cost and improving results. Variants were developed later in the year allowing the programme to be utilised by the Leisure and Lifestyle, and Trade and Construction hubs providing substantial benefits to their contracted clients.

 

Throughout the year the hub ecosystems, whereby the agency’s sector expertise and specialism connects us with and between many UK and European brands, played a key role in attracting new clients, and these became contracted going forwards into 2024.

 

Whilst there was a substantial increase in new clients, the last four months of the year saw a delay in marketing spend from many existing clients due to the economic conditions, and though the agency saw this activity increase in Q1 of 2024, the reduction nevertheless impacted on the sales and therefore profit number for 2023. Resource levels were deliberately maintained during this period as the upturn was visible, but again this reduced profit levels.

 

Throughout the year further investment was made in our people, with new senior staff recruited to add to the specialist skills of the hubs. This provided leadership for growth, enabling a revised and more efficient company structure to be implemented. The agency’s policy of home-grown management continued in parallel, with many promotions as a result of the newly improved development programme GROWS, and this investment, alongside an internal focus on the agency’s values (Accountable, Confident, Devoted, Tenacious and Visionary)  was recognised by the IPA with the agency’s third Platinum CPD award.

 

With the investments and continual improvements made in 2023, built upon by the three-year business plan, the management team continues to drive progress in achieving the agency’s ambitious growth targets, and maximising performance for clients.

Key performance indicators

 

 

 

 

 

 

 

2023

 

2022

 

 

 

 

 

Turnover

 

£6.8m

 

£9.2m

 

 

 

 

 

Gross Profit Margin

 

61.76%

 

55.11%

 

 

 

 

 

Operating Profit Margin (before exceptional costs)

 

10.27%

 

28.70%

 

 

 

 

 

Net Assets

 

£2.9m

 

£2.6m

WAA Chosen Limited
Strategic Report (Continued)
For the year ended 31 December 2023
Page 2

On behalf of the board

A M Wilson
Director
24 September 2024
WAA Chosen Limited
Directors' Report
For the year ended 31 December 2023
Page 3

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

Principal activities

The principal activity of the company continued to be that of Marketing services.

Results and dividends

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £53,000. The dividend was issued in relation to the sale and subsequent strike off of a subsidiary. The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

A M Wilson
J A Lennon
Auditor

In accordance with the company's articles, a resolution proposing that Moore Kingston Smith LLP be reappointed as auditor of the company will be put at a General Meeting.

Statement of directors' responsibilities

The directors are responsible for preparing the annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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:

 

 

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 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.

WAA Chosen Limited
Directors' Report (Continued)
For the year ended 31 December 2023
Page 4
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
A M Wilson
Director
24 September 2024
2024-09-24
WAA Chosen Limited
Independent Auditor's Report
To the Member of WAA Chosen Limited
Page 5
Opinion

We have audited the financial statements of WAA Chosen Limited (the 'company') for the year ended 31 December 2023 which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity, the Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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:

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 Auditor's 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 UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

 

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

 

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

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's 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.

WAA Chosen Limited
Independent Auditor's Report (Continued)
To the Member of WAA Chosen Limited
Page 6

Opinions on other matters prescribed by the Companies Act 2006

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

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:

 

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement, 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.

WAA Chosen Limited
Independent Auditor's Report (Continued)
To the Member of WAA Chosen Limited
Page 7
Auditor's 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 auditor's 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.

 

As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

 

 

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

 

 

WAA Chosen Limited
Independent Auditor's Report (Continued)
To the Member of WAA Chosen Limited
Page 8

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.

Our approach was as follows:

 

 

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, 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.

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member in an auditor's 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 member, for our audit work, for this report, or for the opinions we have formed.

Esther Carder
Senior Statutory Auditor
for and on behalf of Moore Kingston Smith LLP
24 September 2024
Chartered Accountants
Statutory Auditor
Charlotte Building
17 Gresse Street
London
W1T 1QL
WAA Chosen Limited
Statement of Comprehensive Income
For the year ended 31 December 2023
Page 9
2023
2022
as restated
Notes
£
£
Turnover
3
6,799,718
9,285,774
Cost of sales
(2,600,020)
(4,168,305)
Gross profit
4,199,698
5,117,469
Administrative expenses
(3,849,650)
(3,674,644)
Other operating income
4
81,155
46,085
Operating profit before exceptional items
431,203
1,488,910
Other exceptional items
5
(66,187)
(69,500)
Operating profit after exceptional items
6
365,016
1,419,410
Interest receivable and similar income
9
8,676
325
Interest payable and similar expenses
10
(9,570)
(7,700)
Profit before taxation
364,122
1,412,035
Tax on profit
11
(76,733)
(226,207)
Profit for the financial year
287,389
1,185,828

The Profit and Loss Account has been prepared on the basis that all operations are continuing operations.

WAA Chosen Limited
Balance Sheet
As at 31 December 2023
Page 10
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Intangible assets
13
30,652
67,433
Tangible assets
14
253,555
414,877
284,207
482,310
Current assets
Debtors
15
3,383,913
3,246,962
Cash at bank and in hand
1,183,105
1,573,781
4,567,018
4,820,743
Creditors: amounts falling due within one year
16
(1,844,332)
(2,482,987)
Net current assets
2,722,686
2,337,756
Total assets less current liabilities
3,006,893
2,820,066
Creditors: amounts falling due after more than one year
17
(70,833)
(120,833)
Provisions for liabilities
Deferred tax liability
19
(53,701)
(51,263)
(53,701)
(51,263)
Net assets
2,882,359
2,647,970
Capital and reserves
Called up share capital
22
473,000
473,000
Share premium account
325,933
325,933
Profit and loss reserves
2,083,426
1,849,037
Total equity
2,882,359
2,647,970
The financial statements were approved by the board of directors and authorised for issue on 24 September 2024 and are signed on its behalf by:
A M Wilson
Director
Company Registration No. 03477643
WAA Chosen Limited
Statement of Changes in Equity
For the year ended 31 December 2023
Page 11
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
As restated for the period ended 31 December 2022:
Balance at 1 January 2022
473,000
325,933
663,209
1,462,142
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
1,185,828
1,185,828
Balance at 31 December 2022
473,000
325,933
1,849,037
2,647,970
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
287,389
287,389
Dividends
12
-
-
(53,000)
(53,000)
Balance at 31 December 2023
473,000
325,933
2,083,426
2,882,359
WAA Chosen Limited
Statement of Cash Flows
For the year ended 31 December 2023
Page 12
2023
2022
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
26
(54,835)
736,571
Interest paid
(9,570)
(7,700)
Income taxes (paid)/refunded
(206,491)
47,290
Net cash (outflow)/inflow from operating activities
(270,896)
776,161
Investing activities
Purchase of tangible fixed assets
(25,456)
(79,429)
Proceeds from disposal of tangible fixed assets
-
0
200
Interest received
8,676
325
Net cash used in investing activities
(16,780)
(78,904)
Financing activities
Repayment of bank loans
(50,000)
(550,000)
Dividends paid
(53,000)
-
0
Net cash used in financing activities
(103,000)
(550,000)
Net (decrease)/increase in cash and cash equivalents
(390,676)
147,257
Cash and cash equivalents at beginning of year
1,573,781
1,426,524
Cash and cash equivalents at end of year
1,183,105
1,573,781
WAA Chosen Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 13
1
Accounting policies
Company information

WAA Chosen Limited is a private company limited by shares incorporated in England and Wales. The registered office is Wrens Court 58 Victoria Road, Sutton Coldfield, West Midlands, B72 1SY.

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.

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

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the 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.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

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.

 

Media revenue is recognised when charges are made to clients, principally when advertisements appear in the media. Fees are recognised over the period of relevant assignments or agreements.

 

When the outcome of the transaction can be estimated reliably, turnover from advertising space and management of media work is recognised by reference to the stage of completion at the balance sheet date. Stage of completion is measured by reference to when services are rendered. Where the outcome cannot be measured reliably, turnover is recognised to the extent of expenses recognised that are recoverable.

 

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 14
1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 9 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.5
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

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:

Website and software
3-5 years straight line
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:

Fixtures and fittings
20%
Computers
33%

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.

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.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 15

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
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.

1.9
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 balance sheet 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.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 16
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.10
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.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 17
1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

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.

1.14
Share-based payments

Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Black-Scholes model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.

When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.

 

Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
1
Accounting policies
(Continued)
Page 18
1.15
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.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Revenue

Revenue from contracts is assessed on an individual basis with revenue earned being ascertained based on the stage of completion of the contract which is estimated using a combination of milestones in the contract and the time spent to date compared to the total time expected to be required to undertake the contract. Estimates of the total time required to undertake the contracts are made on a regular basis and subject to management review. These estimates may differ from the actual results due to a variety of factors such as efficiency of working, accuracy of assessment of progress to date and client decision making.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 19
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Marketing
6,799,718
9,285,774
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
5,876,626
8,289,691
EU
923,092
996,083
6,799,718
9,285,774
4
Other operating income
2023
2022
£
£
Rent receivable
19,260
43,992
Sundry income
1,386
2,093
Grant income
60,509
-
81,155
46,085
Grant income in 2022 had been included within administrative expenses.
5
Exceptional items
2023
2022
£
£
Expenditure
Professional costs
-
69,500
Redundancy costs
16,187
-
Director's pension contribution
50,000
-
66,187
69,500
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 20
6
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange gains
(1,650)
(3,899)
Fees payable to the company's auditor for the audit of the company's financial statements
25,000
11,500
Depreciation of owned tangible fixed assets
186,778
193,364
Profit on disposal of tangible fixed assets
-
(116)
Amortisation of intangible assets
36,781
37,467
Operating lease charges
135,450
149,450
7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
58
59

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,267,611
2,226,465
Social security costs
255,441
246,734
Pension costs
149,138
179,260
2,672,190
2,652,459
8
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
112,832
109,791
Company pension contributions to defined contribution schemes
67,089
80,577
179,921
190,368
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 21
9
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
8,676
325
10
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
9,570
5,621
Other interest on financial liabilities
-
0
2,079
9,570
7,700
11
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
120,472
241,840
Adjustments in respect of prior periods
(46,177)
-
0
Total current tax
74,295
241,840
Deferred tax
Origination and reversal of timing differences
2,438
(15,633)
Total tax charge
76,733
226,207
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
11
Taxation
(Continued)
Page 22

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
364,122
1,412,035
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
91,031
268,287
Tax effect of expenses that are not deductible in determining taxable profit
5,402
15,962
Tax effect of income not taxable in determining taxable profit
(15,127)
(11,099)
Effect of change in corporation tax rate
(7,685)
-
0
Group relief
-
0
(342)
Research and development tax credit
-
0
(60,378)
Differences in relation to deferred tax
49,289
13,777
Taxation charge for the year
122,910
226,207
Taxation charge in the financial statements
76,733
226,207
Reconciliation - the current year tax charge does not reconcile to the above analysis.  Please review figures in the database.
46,177
-
12
Dividends
2023
2022
£
£
Interim paid
53,000
-
0

The dividends paid were in relation to the sale and subsequent strike off of a subsidiary.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 23
13
Intangible fixed assets
Goodwill
Website and software
Total
£
£
£
Cost
At 1 January 2023 and 31 December 2023
889,770
114,916
1,004,686
Amortisation and impairment
At 1 January 2023
889,770
47,483
937,253
Amortisation charged for the year
-
0
36,781
36,781
At 31 December 2023
889,770
84,264
974,034
Carrying amount
At 31 December 2023
-
0
30,652
30,652
At 31 December 2022
-
0
67,433
67,433
14
Tangible fixed assets
Fixtures and fittings
Computers
Total
£
£
£
Cost
At 1 January 2023
904,695
226,433
1,131,128
Additions
4,012
21,444
25,456
Disposals
-
0
(12,097)
(12,097)
At 31 December 2023
908,707
235,780
1,144,487
Depreciation and impairment
At 1 January 2023
544,309
171,942
716,251
Depreciation charged in the year
144,653
42,125
186,778
Eliminated in respect of disposals
-
0
(12,097)
(12,097)
At 31 December 2023
688,962
201,970
890,932
Carrying amount
At 31 December 2023
219,745
33,810
253,555
At 31 December 2022
360,386
54,491
414,877
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 24
15
Debtors
2023
2022
as restated
Amounts falling due within one year:
£
£
Trade debtors
1,114,029
1,459,983
Corporation tax recoverable
376,886
142,661
Amounts owed by group undertakings
460,022
540,034
Other debtors
1,042,229
348,152
Prepayments and accrued income
390,747
756,132
3,383,913
3,246,962
16
Creditors: amounts falling due within one year
2023
2022
as restated
Notes
£
£
Bank loans
18
50,000
50,000
Trade creditors
556,140
576,667
Amounts owed to group undertakings
75,694
75,694
Corporation tax
246,946
379,142
Other taxation and social security
241,309
284,076
Other creditors
110,281
140,707
Accruals and deferred income
563,962
976,701
1,844,332
2,482,987
17
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
18
70,833
120,833
18
Loans and overdrafts
2023
2022
£
£
Bank loans
120,833
170,833
Payable within one year
50,000
50,000
Payable after one year
70,833
120,833
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
18
Loans and overdrafts
(Continued)
Page 25

Other loans includes an unsecured loan repayable by May 2026 in monthly instalments. Interest is charged at base rate plus 1.98% per annum.

19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
53,701
51,263
2023
Movements in the year:
£
Liability at 1 January 2023
51,263
Charge to profit or loss
2,438
Liability at 31 December 2023
53,701
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
149,138
179,260

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. At the year end a liability of £14,348 (2022: £15,341) was outstanding.

21
Share-based payment transactions
Number of share options
Weighted average exercise price
2023
2022
2023
2022
Number
Number
£
£
Outstanding at 1 January 2023 and 31 December 2023
62,841
62,841
0.64
0.64
Exercisable at 31 December 2023
-
0
-
0
-
0
-
0
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
21
Share-based payment transactions
(Continued)
Page 26

The options outstanding at 31 December 2023 had an exercise price ranging from 61p to 93p, and a remaining contractual life of 7 years.

22
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
473,000
473,000
473,000
473,000
23
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
153,902
193,676
Between two and five years
297,307
490,211
451,209
683,887
24
Related party transactions

The company has taken the exemption available under FRS102 section 33 and not disclosed transactions with 100% group companies.

 

During the year, the company rented Unit 3, Unit 4, Unit 5, and Unit 6 Wrens Court from a director's, Pension fund. The total charge in the year was £135,450 (2022: £149,450). At the year end the company owed the pension fund £171,900 (2022: £162,540). This amount is interest free and repayable on demand.

 

At the year end the company was owed £1,008,500 (2023: £314,500) by a director. This amount is interest free and repayable on demand.

 

During the year, the company made purchases of £67,167 (2022: £40,858) from a company under common control. No amounts (2022: £Nil) were payable at the year end.

25
Ultimate controlling party

The company is a wholly owned subsidiary of WAA Group Limited, a company registered in England and Wales, and registered at Wrens Court, 58 Victoria Road, Sutton Coldfield, B72 1SY. WAA Group Limited is the ultimate parent company and is controlled by A M Wilson.

WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 27
26
Cash (absorbed by)/generated from operations
2023
2022
£
£
Profit for the year after tax
287,389
1,185,828
Adjustments for:
Taxation charged
76,733
226,207
Finance costs
9,570
7,700
Investment income
(8,676)
(325)
Gain on disposal of tangible fixed assets
-
(116)
Amortisation and impairment of intangible assets
36,781
37,467
Depreciation and impairment of tangible fixed assets
186,778
193,364
Movements in working capital:
(Increase)/decrease in debtors
(136,951)
195,922
Decrease in creditors
(506,459)
(1,109,476)
Cash (absorbed by)/generated from operations
(54,835)
736,571
27
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
1,573,781
(390,676)
1,183,105
Borrowings excluding overdrafts
(170,833)
50,000
(120,833)
1,402,948
(340,676)
1,062,272
WAA Chosen Limited
Notes to the Financial Statements (Continued)
For the year ended 31 December 2023
Page 28
28
Prior period adjustment
Changes to the balance sheet
As previously reported
Adjustment
As restated at 31 Dec 2022
£
£
£
Current assets
Debtors due within one year
3,155,837
91,125
3,246,962
Creditors due within one year
Taxation
(572,093)
(91,125)
(663,218)
Net assets
2,647,970
-
2,647,970
Capital and reserves
Total equity
2,647,970
-
2,647,970
Notes to reconciliation

The prior period figures have been amended because, a provision for S455 tax had not been recognised. Correcting this error has resulted in a increase in Debtors due within one year and Creditors due within one of £91,125. There is no effect to the profit and loss or net assets.

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