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COMPANY REGISTRATION NUMBER: 01143517
Harold L Smith (Transmissions) Limited
Financial Statements
31 December 2023
Harold L Smith (Transmissions) Limited
Financial Statements
Year ended 31 December 2023
Contents
Pages
Officers and professional advisers
1
Directors' report
2 to 3
Independent auditor's report to the members
4 to 7
Statement of income and retained earnings
8
Statement of financial position
9
Notes to the financial statements
10 to 14
Harold L Smith (Transmissions) Limited
Officers and Professional Advisers
The board of directors
S P Steadman
G Heald
G Kostopoulos
A Victoria
Registered office
Enterprise Business Park
Cross Road
Albrighton
Wolverhampton
WV7 3BJ
Auditor
Muras Baker Jones Limited
Chartered accountants & statutory auditor
Regent House
Bath Avenue
Wolverhampton
West Midlands
WV1 4EG
Bankers
Lloyds TSB Bank plc
PO Box 44
125 Colmore Row
Birmingham
B3 3AD
Harold L Smith (Transmissions) Limited
Directors' Report
Year ended 31 December 2023
The directors present their report and the financial statements of the company for the year ended 31 December 2023 .
Principal activities
The principal activity of the company continued to be the supply, repair and reconditioning of axles and gearboxes for commercial vehicles.
Directors
The directors who served the company during the year were as follows:
S P Steadman
G Heald
G Kostopoulos
A Victoria
A R Aston
(Resigned 1 January 2023)
Directors' responsibilities statement
The directors are responsible for preparing 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 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 the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and 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. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. A resolution to reappoint Muras Baker Jones Limited as auditors will be proposed at the forthcoming Annual General Meeting.
Small company provisions
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
This report was approved by the board of directors on 25 September 2024 and signed on behalf of the board by:
S P Steadman
Director
Harold L Smith (Transmissions) Limited
Independent Auditor's Report to the Members of Harold L Smith (Transmissions) Limited
Year ended 31 December 2023
Opinion
We have audited the financial statements of Harold L Smith (Transmissions) Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of income and retained earnings, statement of financial position and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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: - give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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. 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. In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the directors' report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit; or - the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the directors' report and from the requirement to prepare a strategic report.
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.
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. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: In planning and designing our audit tests we identify and assess the risks of material misstatement within the financial statements, whether due to fraud or error. Our assessment of these risks includes consideration of the nature of the industry and sector, the control environment and the business performance along with the results of our enquiries of management about their own identification and assessment of risks and irregularities. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act, UK tax legislation and other laws and regulations identified as risk areas identified from our discussions with management. We communicated relevant identified laws and regulations and potential fraud risks to all engagement team members including internal specialists, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. After consideration of the above risks we then carried out audit procedures including the following: - specific tests in relation to material amounts and disclosures in the financial statements considered to be of high risk; - performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; - reading minutes of management meetings; - reviewing correspondence with H M Revenue & Customs; - enquiring of management and reviewing any correspondence with legal advisors concerning actual and potential litigation and claims; - reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements; - in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. There are inherent limitations in our audit procedures described above. The more removed that the laws and regulations are from financial transactions the less likely it is that we would be aware on non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to inquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. 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 auditor’s report. Use of our report
This report is made solely to the company's members, as a body, in accordance with chapter 3 of part 16 of the Companies Act 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 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 members as a body, for our audit work, for this report, or for the opinions we have formed.
Oliver Ross BSc FCA
(Senior Statutory Auditor)
For and on behalf of
Muras Baker Jones Limited
Chartered accountants & statutory auditor
Regent House
Bath Avenue
Wolverhampton
West Midlands
WV1 4EG
25 September 2024
Harold L Smith (Transmissions) Limited
Statement of Income and Retained Earnings
Year ended 31 December 2023
2023
2022
Note
£
£
Turnover
8,420,330
7,353,734
Cost of sales
5,612,370
4,856,596
------------
------------
Gross profit
2,807,960
2,497,138
Distribution costs
183,658
211,136
Administrative expenses
1,105,555
845,159
------------
------------
Operating profit
1,518,747
1,440,843
Interest payable and similar expenses
970
------------
------------
Profit before taxation
6
1,518,747
1,439,873
Tax on profit
358,394
275,099
------------
------------
Profit for the financial year and total comprehensive income
1,160,353
1,164,774
------------
------------
Retained earnings at the start of the year
3,746,869
2,582,095
------------
------------
Retained earnings at the end of the year
4,907,222
3,746,869
------------
------------
All the activities of the company are from continuing operations.
Harold L Smith (Transmissions) Limited
Statement of Financial Position
31 December 2023
2023
2022
Note
£
£
£
Fixed assets
Tangible assets
7
387,479
406,931
Current assets
Stocks
1,992,500
1,737,432
Debtors
8
3,245,927
2,062,879
Cash at bank and in hand
763,468
744,397
------------
------------
6,001,895
4,544,708
Creditors: amounts falling due within one year
9
1,425,052
1,145,670
------------
------------
Net current assets
4,576,843
3,399,038
------------
------------
Total assets less current liabilities
4,964,322
3,805,969
Provisions
Taxation including deferred tax
48,000
50,000
------------
------------
Net assets
4,916,322
3,755,969
------------
------------
Capital and reserves
Called up share capital
9,100
9,100
Profit and loss account
4,907,222
3,746,869
------------
------------
Shareholders funds
4,916,322
3,755,969
------------
------------
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies' regime and in accordance with Section 1A of FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
These financial statements were approved by the board of directors and authorised for issue on 25 September 2024 , and are signed on behalf of the board by:
S P Steadman
Director
Company registration number: 01143517
Harold L Smith (Transmissions) Limited
Notes to the Financial Statements
Year ended 31 December 2023
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Enterprise Business Park, Cross Road, Albrighton, Wolverhampton, WV7 3BJ.
2. Statement of compliance
These financial statements have been prepared in compliance with Section 1A of FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
(a) Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
(b) Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
(c) Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
(d) Income tax
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
(e) Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.
(f) Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.
(g) Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Commercial Vehicles
-
33 1/3% on written down value
Plant and Machinery
-
15%/20% on written down value
Motor Vehicles
-
25% on written down value
(h) Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
(i) Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
(j) Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.
(k) Financial instruments
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 entity after deducting all of its financial liabilities.
Where the contractual obligations of financial instruments (including share capital) are equivalent to a similar debt instrument, those financial instruments are classed as financial liabilities. Financial liabilities are presented as such in the balance sheet. Finance costs and gains or losses relating to financial liabilities are included in the profit and loss account. Finance costs are calculated so as to produce a constant rate of return on the outstanding liability.
Where the contractual terms of share capital do not have any terms meeting the definition of a financial liability then this is classed as an equity instrument. Dividends and distributions relating to equity instruments are debited direct to equity.
(l) Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
4. Auditor's remuneration
2023
2022
£
£
Fees payable for the audit of the financial statements
13,000
12,500
--------
--------
5. Employee numbers
The average number of persons employed by the company during the year amounted to 69 (2022: 69 ).
6. Profit before taxation
Profit before taxation is stated after charging:
2023
2022
£
£
Depreciation of tangible assets
96,927
92,127
--------
--------
7. Tangible assets
Commercial vehicles
Plant and machinery
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2023
229,224
1,847,807
46,549
2,123,580
Additions
81,234
22,525
103,759
Disposals
( 80,606)
( 26,675)
( 107,281)
---------
------------
--------
------------
At 31 December 2023
229,852
1,870,332
19,874
2,120,058
---------
------------
--------
------------
Depreciation
At 1 January 2023
144,262
1,552,349
20,038
1,716,649
Charge for the year
35,936
60,655
336
96,927
Disposals
( 71,007)
( 9,990)
( 80,997)
---------
------------
--------
------------
At 31 December 2023
109,191
1,613,004
10,384
1,732,579
---------
------------
--------
------------
Carrying amount
At 31 December 2023
120,661
257,328
9,490
387,479
---------
------------
--------
------------
At 31 December 2022
84,962
295,458
26,511
406,931
---------
------------
--------
------------
8. Debtors
2023
2022
£
£
Trade debtors
1,039,635
771,319
Amounts owed by group undertakings
2,100,085
1,160,928
Prepayments and accrued income
102,857
128,632
Other debtors
3,350
2,000
------------
------------
3,245,927
2,062,879
------------
------------
9. Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
795,847
706,749
Amounts owed to group undertakings
143,460
147,382
Accruals and deferred income
55,075
48,458
Corporation tax
154,394
78,500
Social security and other taxes
264,023
153,611
Other creditors
12,253
10,970
------------
------------
1,425,052
1,145,670
------------
------------
10. Operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
2023
2022
£
£
Not later than 1 year
189,809
192,837
Later than 1 year and not later than 5 years
771,898
735,916
Later than 5 years
612,908
642,958
------------
------------
1,574,615
1,571,711
------------
------------
11. Controlling party
The immediate parent company is ATCDT Corp. A company registered in the USA . The ultimate controlling party is Crestview ATC Holdings, L.P., a limited partnership registered in the USA. In accordance with 33.1A of FRS 102 the company has taken the exemption from disclosing transactions and balances with its parent company and other wholly owned members of the group.