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Registration number: 02678057

Doherty IT Solutions Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 31 December 2023

 

Doherty IT Solutions Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4

Statement of Directors' Responsibilities

5

Independent Auditor's Report

6 to 8

Consolidated Profit and Loss Account

9

Consolidated Statement of Comprehensive Income

10

Consolidated Balance Sheet

11

Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Statement of Changes in Equity

14

Consolidated Statement of Cash Flows

15

Notes to the Financial Statements

16 to 31

 

Doherty IT Solutions Limited

Company Information

Directors

T Doherty

A Mitchell

J Mitchell

A Haywood

Company secretary

A Haywood

Registered office

The Connection
4th Floor
198 High Holborn
London
WC1V 7BD

Auditors

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

Doherty IT Solutions Limited

Strategic Report for the Year Ended 31 December 2023

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

Fair review of the business

The results for the year which are set out in the profit and loss account show turnover of £11,506,398 (2022 - £11,216,057) and an operating profit of £338,338 (2022 - £539,809). At 31 December 2023 the group had net assets of £1,514,063 (2022 - £1,640,103). The directors consider the performance for the year and the financial position at the year end to be satisfactory.

Gross profit increased between 2022 (18.75%) and 2023 (22.55%) as the business invested in the leadership team and restructured the operations and professional services divisions in prior year.

The directors consider the performance for the year and the financial position at the year-end to be in line with expectations.

Future developments

The directors are dedicated to achieving the strategic goals of the company, providing high quality IT managed services and solutions to our clients, growing our market share and investing in innovation and technology.

Some of our future plans to support these goals are;

For Cyber Security, advancing our Cyber Security services, by expanding and improving them to make them more attainable for our SME clients. We are determined to help our clients enhance their security position by making it easier for them to access those services and at the same time broadening our Core and Advanced services;

Leveraging AI, by building on our commitment to create and deliver AI-integrated services that are affordable, relevant, and transformative for our clients. We have developed managed compliance offerings that complement our Cyber security offerings, enabling our clients to use generative AI technology whilst managing the potential risks associated with their use;

Internal investment, this continues in our internal teams through training and development on BTL1 and Microsoft certifications, by further growing and strengthening our 24x7 operation to drive scalable growth and continually improve and streamline service delivery, both in professional services and managed support.

Principal risks and uncertainties

The group's operations expose it to a variety of business and financial risks.

The group has in place a risk management programme that seeks to limit the adverse effect on the financial performance of the group by monitoring levels of debt finance and the related finance costs. The company does not use derivative financial instruments to manage interest rate costs, and as such no hedge accounting is applied.

Given the size of the group, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the board. The group's finance department implements the policies set by the board of directors. The department have guidelines, agreed by the directors, to manage interest rate risk, credit risk and circumstances where it would be appropriate to use financial instruments to manage these.

Financial instruments

The group's financial instruments comprise borrowings, cash and liquid resources, and various other items such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to finance the operations of the group.

The group does not actively use financial instruments as part of its financial risk management. It is exposed to the usual credit risk associated with selling on credit and manages this through credit control procedures. The nature of its financial instruments means they are not subject to price or liquidity risk.

 

Doherty IT Solutions Limited

Strategic Report for the Year Ended 31 December 2023

Going concern

At the year end, the group has net assets of £1,514,063 (2022 - £1,640,103). The directors have prepared detailed cash flow forecasts for the group for more than 12 months from the approval of these financial statements.

These forecasts are based on the key assumption that our strong client retention record will continue, driven by our ability to consistently deliver high-quality, industry-leading service levels and a diverse portfolio of sector-specific services and products. The directors are confident that our robust financial management processes - specifically, the focus on departmental and product-level accountability—will continue to support sustained profitability, optimise operational efficiency, and maintain effective cost control. These measures ensure a resilient and scalable business model, well-positioned for future growth and strategic opportunities.

These forecasts indicate the group is able to operate within its facilities and meet its liabilities as they fall due. On the basis of the points above, the directors are satisfied that it is appropriate to prepare the financial statements on a going concern basis.

Approved by the Board on 24 September 2024 and signed on its behalf by:


T Doherty
Director

 

Doherty IT Solutions Limited

Directors' Report for the Year Ended 31 December 2023

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

Principal activity

The principal activity of the group and company continued to be that of the provision of information technology, consultancy and related computer services.

Directors of the company

The directors who held office during the year were as follows:

T Doherty

A Mitchell

J Mitchell

A Haywood - Company secretary and director

Disclosure of information to the auditor

Each director has taken the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the group's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.

Reappointment of auditors

Hazlewoods LLP have expressed their willingness to continue in office.

Approved by the Board on 24 September 2024 and signed on its behalf by:


T Doherty
Director

 

Doherty IT Solutions Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the Strategic Report, 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 group and company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Doherty IT Solutions Limited

Independent Auditor's Report to the Members of Doherty IT Solutions Limited

Opinion

We have audited the financial statements of Doherty IT Solutions Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

give a true and fair view of the state of the group's and the parent company's affairs as at 31 December 2023 and of the group's profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

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 responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 group's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

Opinion on other matter 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 Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

 

Doherty IT Solutions Limited

Independent Auditor's Report to the Members of Doherty IT Solutions Limited

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

the parent company 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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 5, 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 group’s and the parent 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 group or the parent 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.

Extent to which the audit was 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:

We considered the nature of the group’s industry and its control environment and reviewed the groups’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities.

We obtained an understanding of the legal and regulatory framework that the group operates in and identified the key laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements, including the UK Companies Act and tax legislation, and, those that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty.

We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgments made in accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.

In addition to the above, our procedures to respond to the risks identified included the following:

reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatements due to fraud;

 

Doherty IT Solutions Limited

Independent Auditor's Report to the Members of Doherty IT Solutions Limited

enquiring of management concerning actual and potential litigation and claims and instances of non-compliance with laws and regulations; and

reading minutes of meetings of those charged with governance.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that 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, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available 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.





Scott Lawrence (Senior Statutory Auditor)
For and on behalf of Hazlewoods LLP, Statutory Auditor

Staverton Court
Staverton
Cheltenham
GL51 0UX

24 September 2024

 

Doherty IT Solutions Limited

Consolidated Profit and Loss Account for the Year Ended 31 December 2023

Note

2023
 £

2022
 £

Turnover

3

11,506,398

11,216,057

Cost of sales

 

(8,912,144)

(9,113,066)

Gross profit

 

2,594,254

2,102,991

Administrative expenses

 

(2,255,916)

(2,263,426)

Other operating income

4

-

700,244

Operating profit

5

338,338

539,809

Interest receivable and similar income

5,226

1,565

Interest payable and similar charges

6

(11,553)

(9,389)

Profit before tax

 

332,011

531,985

Taxation

10

(11,919)

133,735

Profit for the financial year

 

320,092

665,720

Profit attributable to:

 

Owners of the group

 

320,092

665,720

The above results were derived from continuing operations.

 

Doherty IT Solutions Limited

Consolidated Statement of Comprehensive Income for the Year Ended 31 December 2023

2023
£

2022
£

Profit for the year

320,092

665,720

Foreign currency translation (losses)/gains

(7,770)

1,483

Total comprehensive income for the year

312,322

667,203

Total comprehensive income attributable to:

Owners of the group

312,322

667,203

 

Doherty IT Solutions Limited

(Registration number: 02678057)
Consolidated Balance Sheet as at 31 December 2023

Note

2023
 £

2022
 £

Fixed assets

 

Intangible assets

11

233,367

256,036

Tangible assets

12

101,540

124,903

 

334,907

380,939

Current assets

 

Debtors

14

2,167,488

2,474,640

Cash at bank and in hand

15

1,908,025

1,889,317

 

4,075,513

4,363,957

Creditors: Amounts falling due within one year

16

(2,789,472)

(2,944,893)

Net current assets

 

1,286,041

1,419,064

Total assets less current liabilities

 

1,620,948

1,800,003

Creditors: Amounts falling due after more than one year

16

(75,036)

(125,036)

Provisions for liabilities

10

(31,849)

(34,864)

Net assets

 

1,514,063

1,640,103

Capital and reserves

 

Called up share capital

19

100

100

Profit and loss account

1,513,963

1,640,003

Equity attributable to owners of the Group

 

1,514,063

1,640,103

Total equity

 

1,514,063

1,640,103

Approved and authorised by the Board on 24 September 2024 and signed on its behalf by:
 

T Doherty
Director

 

Doherty IT Solutions Limited

(Registration number: 02678057)
Balance Sheet as at 31 December 2023

Note

2023
 £

2022
 £

Fixed assets

 

Intangible assets

11

136,017

123,287

Tangible assets

12

80,890

94,827

Investments

13

350,000

350,000

 

566,907

568,114

Current assets

 

Debtors

14

2,149,956

2,459,011

Cash at bank and in hand

 

1,747,648

1,752,154

 

3,897,604

4,211,165

Creditors: Amounts falling due within one year

16

(2,744,732)

(2,899,633)

Net current assets

 

1,152,872

1,311,532

Total assets less current liabilities

 

1,719,779

1,879,646

Creditors: Amounts falling due after more than one year

16

(75,036)

(125,036)

Provisions for liabilities

10

(31,251)

(33,661)

Net assets

 

1,613,492

1,720,949

Capital and reserves

 

Called up share capital

19

100

100

Profit and loss account

1,613,392

1,720,849

Total equity

 

1,613,492

1,720,949

The company made a profit after tax for the financial year of £330,905 (2022 - profit of £659,300).

Approved and authorised by the Board on 24 September 2024 and signed on its behalf by:
 

T Doherty
Director

 

Doherty IT Solutions Limited

Consolidated Statement of Changes in Equity for the Year Ended 31 December 2023
Equity attributable to the parent company

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2022

100

1,174,440

1,174,540

Profit for the year

-

665,720

665,720

Other comprehensive income

-

1,483

1,483

Total comprehensive income

-

667,203

667,203

Dividends

-

(201,640)

(201,640)

At 31 December 2022

100

1,640,003

1,640,103

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2023

100

1,640,003

1,640,103

Profit for the year

-

320,092

320,092

Other comprehensive income

-

(7,770)

(7,770)

Total comprehensive income

-

312,322

312,322

Dividends

-

(438,362)

(438,362)

At 31 December 2023

100

1,513,963

1,514,063

 

Doherty IT Solutions Limited

Statement of Changes in Equity for the Year Ended 31 December 2023

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2022

100

1,263,189

1,263,289

Profit for the year

-

659,300

659,300

Dividends

-

(201,640)

(201,640)

At 31 December 2022

100

1,720,849

1,720,949

Share capital
£

Profit and loss account
£

Total
£

At 1 January 2023

100

1,720,849

1,720,949

Profit for the year

-

330,905

330,905

Dividends

-

(438,362)

(438,362)

At 31 December 2023

100

1,613,392

1,613,492

 

Doherty IT Solutions Limited

Consolidated Statement of Cash Flows for the Year Ended 31 December 2023

Note

2023
£

2022
£

Cash flows from operating activities

Profit for the year

 

320,092

665,720

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

155,805

146,084

(Profit)/loss on disposal of tangible assets

(5)

590

Finance income

(5,226)

(1,565)

Finance costs

11,553

9,389

Income tax expense

10

11,919

(133,735)

Foreign exchange gains/losses

 

(7,770)

1,483

 

486,368

687,966

Working capital adjustments

 

Decrease in stocks

 

-

11,586

Decrease in debtors

 

221,173

297,577

(Decrease)/increase in creditors

 

(138,432)

227,290

Cash generated from operations

 

569,109

1,224,419

Income taxes received

10

74,056

189,099

Net cash flow from operating activities

 

643,165

1,413,518

Cash flows from investing activities

 

Interest received

5,226

1,565

Acquisitions of tangible assets

12

(55,994)

(97,069)

Proceeds from sale of tangible assets

 

472

-

Acquisition of intangible assets

11

(54,246)

(51,048)

Net cash flows from investing activities

 

(104,542)

(146,552)

Cash flows from financing activities

 

Interest paid

(11,553)

(9,389)

Repayment of bank borrowing

 

(50,000)

(107,219)

Repayment of other borrowing

 

(20,000)

(7,177)

Dividends paid

(438,362)

(201,640)

Net cash flows from financing activities

 

(519,915)

(325,425)

Net increase in cash and cash equivalents

 

18,708

941,541

Cash and cash equivalents at 1 January

 

1,889,317

947,776

Cash and cash equivalents at 31 December

 

1,908,025

1,889,317

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
The Connection
4th Floor
198 High Holborn
London
WC1V 7BD

 

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is pounds sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest pound.

Summary of disclosure exemptions

The company has taken advantage of the following disclosure exemptions available to qualifying entities in preparing its separate financial statements, as permitted by FRS 102:
• the requirements of Section 7 Statement of Cash Flows;
• the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
• the requirements of Section 33 Related Party Disclosures paragraph 33.7; and
• the requirements of certain paragraphs within Sections 11 and 12 relating to Financial Instruments..

Basis of consolidation

The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December 2023.

A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.

The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.

Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.

Going concern

At the year end, the group has net assets of £1,514,063 (2022 - £1,640,103). The directors have prepared detailed cash flow forecasts for the group for more than 12 months from the approval of these financial statements. These forecasts indicate the group is able to operate within its facilities and meet its liabilities as they fall due. On the basis of the points above, the directors are satisfied that it is appropriate to prepare the financial statements on a going concern basis.

Critical accounting judgements and key sources of estimation uncertainty
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
 

Judgements

No significant judgements have been made by management in preparing these financial statements.

Key sources of estimation uncertainty

No key sources of estimation uncertainty have been identified by management in preparing these financial statements other than those detailed in these accounting policies.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the group’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.

The group recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the group's activities.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Deferred tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements and on unused tax losses or tax credits in the group. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Tangible assets

Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Land and buildings

Straight line over term of lease

Furniture, fittings and equipment

2 to 5 years straight line

Intangible assets

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date.

Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

Negative goodwill arising on an acquisition is recognised on the face of the balance sheet on the acquisition date and subsequently the excess up to the fair value of non-monetary assets acquired is recognised in profit or loss in the periods in which the non-monetary assets are recovered.

Development costs (including software) are recognised at fair value at the acquisition date.

Development costs (including software) have a finite useful life and are carried at cost less accumulated amortisation and any accumulated impairment losses.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Internally generated software development costs

3 years

Investments

Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits.

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the debtors.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Provisions

Provisions are recognised when the group has an obligation at the reporting date as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the group’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Financial instruments


Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

3

Turnover

The analysis of the group's Turnover for the year from continuing operations is as follows:

2023
£

2022
£

Rendering of services

11,506,398

11,216,057

The analysis of the group's Turnover for the year by market is as follows:

2023
£

2022
£

UK

6,595,772

6,064,474

Europe

1,410,095

1,090,236

Rest of world

3,500,531

4,061,347

11,506,398

11,216,057

 

4

Other operating income

The analysis of the group's other operating income for the year is as follows:

2023
£

2022
£

Insurance claim

-

700,244

 

5

Operating profit

Arrived at after charging/(crediting)

2023
£

2022
£

Depreciation expense

78,890

88,313

Amortisation expense

76,915

57,771

Research and development cost

390,999

567,669

Foreign exchange losses

11,632

28,585

Operating lease expense - property

152,250

218,642

 

6

Interest payable and similar expenses

2023
£

2022
£

Interest on bank overdrafts and borrowings

11,553

9,389

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

7

Staff costs

Group
The aggregate payroll costs (including directors' remuneration) were as follows:

2023
 £

2022
 £

Wages and salaries

4,670,492

4,940,477

Social security costs

457,285

521,733

Pension costs, defined contribution scheme

214,439

194,304

5,342,216

5,656,514

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

2023
 No.

2022
 No.

Production

86

91

Administration and support

14

13

100

104

Company
The aggregate payroll costs (including directors' remuneration) were as follows:

2023
 £

2022
 £

Wages and salaries

3,791,104

4,184,540

Social security costs

457,285

521,733

Pension costs, defined contribution scheme

112,654

104,661

4,361,043

4,810,934

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2023
 No.

2022
 No.

Production

46

56

Administration and support

11

10

57

66

 

8

Directors' remuneration

The directors' remuneration for the year was as follows:

2023
£

2022
£

Remuneration

365,600

479,550

Contributions paid to money purchase schemes

47,631

35,054

413,231

514,604

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

8

Directors' remuneration (continued)

During the year the number of directors who were receiving benefits and share incentives was as follows:

2023
No.

2022
No.

Received or were entitled to receive shares under long term incentive schemes

1

1

Accruing benefits under money purchase pension scheme

3

4

In respect of the highest paid director:

2023
£

2022
£

Remuneration

184,207

174,146

Company contributions to money purchase pension schemes

7,700

7,408

 

9

Auditors' remuneration

2023
£

2022
£

Audit of these financial statements

15,750

15,200

Audit of the financial statements of subsidiaries of the company pursuant to legislation

1,410

1,350

17,160

16,550

Other fees to auditors

All other non-audit services

12,940

11,053


 

 

10

Taxation

Tax charged/(credited) in the consolidated profit and loss account

2023
£

2022
£

Current taxation

UK corporation tax

-

(38,678)

UK corporation tax adjustment to prior periods

6,125

(100,545)

6,125

(139,223)

Foreign tax

8,732

10,908

Total current income tax

14,857

(128,315)

Deferred taxation

Arising from origination and reversal of timing differences

(4,131)

9,594

Arising from previously unrecognised tax loss, tax credit or temporary difference of prior periods

1,193

(15,014)

Total deferred taxation

(2,938)

(5,420)

Tax expense/(receipt) in the income statement

11,919

(133,735)

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

10

Taxation (continued)

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2022 - lower than the standard rate of corporation tax in the UK) of 23.52% (2022 - 19%).

The differences are reconciled below:

2023
£

2022
£

Profit before tax

332,011

531,985

Corporation tax at standard rate

78,089

101,077

Decrease from effect of different UK tax rates on some earnings

(124)

-

Effect of expense not deductible in determining taxable profit (tax loss)

16,374

10,158

Effect of foreign tax rates

(3,589)

(1,369)

Increase in UK and foreign current tax from unrecognised temporary difference from a prior period

-

2,858

Deferred tax expense/(credit) from unrecognised temporary difference from a prior period

1,193

(15,014)

Increase/(decrease) in UK and foreign current tax from adjustment for prior periods

6,125

(100,545)

Tax increase/(decrease) from effect of capital allowances and depreciation

4,183

(3,020)

Tax decrease from effect of adjustment in research and development tax credit

(87,929)

(127,880)

Other tax effects

(2,403)

-

Total tax charge/(credit)

11,919

(133,735)

Deferred tax

Group

Deferred tax assets and liabilities

2023

Liability
£

Fixed asset timing differences

31,849

31,849

2022

Liability
£

Fixed asset timing differences

34,864

34,864

Company

Deferred tax assets and liabilities

2023

Liability
£

Fixed asset timing differences

31,251

31,251

2022

Liability
£

Fixed asset timing differences

33,661

33,661

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

10

Taxation (continued)

An increase in the UK corporation tax rate to 25%, effective from April 2023, was announced and substantively enacted on 24 May 2021. The deferred liability as at 31 December 2022 has been calculated based on the rate of 25%.

 

11

Intangible assets

Group

Goodwill
 £

Computer software
£

Internally generated software development costs
 £

Total
£

Cost

At 1 January 2023

353,993

80,033

122,258

556,284

Additions

-

-

54,246

54,246

At 31 December 2023

353,993

80,033

176,504

610,530

Amortisation

At 1 January 2023

221,244

39,410

39,594

300,248

Amortisation charge

35,399

-

41,516

76,915

At 31 December 2023

256,643

39,410

81,110

377,163

Carrying amount

At 31 December 2023

97,350

40,623

95,394

233,367

At 31 December 2022

132,749

40,623

82,664

256,036

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

11

Intangible assets (continued)

Company

Computer software
£

Internally generated software development costs
 £

Total
£

Cost

At 1 January 2023

80,033

122,258

202,291

Additions

-

54,246

54,246

At 31 December 2023

80,033

176,504

256,537

Amortisation

At 1 January 2023

39,410

39,594

79,004

Amortisation charge

-

41,516

41,516

At 31 December 2023

39,410

81,110

120,520

Carrying amount

At 31 December 2023

40,623

95,394

136,017

At 31 December 2022

40,623

82,664

123,287

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

12

Tangible assets

Group

Leasehold improvements
£

Furniture, fittings and equipment
 £

Total
£

Cost

At 1 January 2023

14,129

358,542

372,671

Additions

-

55,994

55,994

Disposals

-

(7,585)

(7,585)

At 31 December 2023

14,129

406,951

421,080

Depreciation

At 1 January 2023

3,277

244,491

247,768

Charge for the year

8,029

70,861

78,890

Eliminated on disposal

-

(7,118)

(7,118)

At 31 December 2023

11,306

308,234

319,540

Carrying amount

At 31 December 2023

2,823

98,717

101,540

At 31 December 2022

10,852

114,051

124,903

Company

Leasehold improvements
£

Furniture, fittings and equipment
 £

Total
£

Cost

At 1 January 2023

14,129

270,315

284,444

Additions

-

48,600

48,600

Disposals

-

(7,003)

(7,003)

At 31 December 2023

14,129

311,912

326,041

Depreciation

At 1 January 2023

3,277

186,340

189,617

Charge for the year

8,029

54,041

62,070

Eliminated on disposal

-

(6,536)

(6,536)

At 31 December 2023

11,306

233,845

245,151

Carrying amount

At 31 December 2023

2,823

78,067

80,890

At 31 December 2022

10,852

83,975

94,827

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

13

Investments

Company

2023
£

2022
£

Investments in subsidiaries

350,000

350,000

Subsidiaries

£

Cost

At 1 January 2023 and at 31 December 2023

350,000

Carrying amount

At 31 December 2022 and at 31 December 2023

350,000

Details of undertakings

Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

     

2023

2022

Subsidiary undertakings

Doherty IT Solutions Sdn. Bhd.

No. 308, Block A (3rd Floor), Kelana Business Centre, No. 97, Jalan SS7/2, Kelana Jaya, 47301 Petaling Jaya, Selangor Darul Ehsan.

Ordinary

100%

100%

The principal activities of the subsidiary company are to provide consultation services on IT support, IT outsourcing, administration and marketing services.

 

14

Debtors

 

Group

Company

2023
 £

2022
 £

2023
 £

2022
 £

Trade debtors

1,514,865

1,902,568

1,514,865

1,799,893

Amounts owed by subsidiary undertaking

-

-

-

96,000

Other debtors

314,131

347,531

307,638

341,811

Prepayments

215,644

186,623

206,970

182,629

Corporation tax asset

122,848

37,918

120,483

38,678

Total current trade and other debtors

2,167,488

2,474,640

2,149,956

2,459,011

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

15

Cash and cash equivalents

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Cash on hand

146

225

-

160

Cash at bank

1,907,879

1,889,092

1,747,648

1,751,994

1,908,025

1,889,317

1,747,648

1,752,154

 

16

Creditors

   

Group

Company

Note

2023
 £

2022
 £

2023
 £

2022
 £

Due within one year

 

Loans and borrowings

17

50,000

70,000

50,000

70,000

Trade creditors

 

560,840

584,158

560,840

584,158

Amounts due to subsidiary undertaking

 

-

-

15,301

-

Social security and other taxes

 

221,855

331,351

221,855

331,351

Other creditors

 

28,877

45,690

24,980

43,671

Accrued expenses

 

463,973

426,427

407,829

383,186

Deferred income

 

1,463,927

1,487,267

1,463,927

1,487,267

 

2,789,472

2,944,893

2,744,732

2,899,633

Due after one year

 

Loans and borrowings

17

75,036

125,036

75,036

125,036

 

17

Loans and borrowings

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Current loans and borrowings

Bank borrowings

50,000

50,000

50,000

50,000

Other borrowings

-

20,000

-

20,000

50,000

70,000

50,000

70,000

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Non-current loans and borrowings

Bank borrowings

75,036

125,036

75,036

125,036

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

18

Pension and other schemes

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £214,439 (2022 - £194,304).

 

19

Share capital

Allotted, called up and fully paid shares

 

2023

2022

 

No.

£

No.

£

Ordinary shares of £0.01 each

10,000

100

10,000

100

         
 

20

Obligations under leases and hire purchase contracts

Company

Operating leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

152,250

152,250

Later than one year and not later than five years

190,313

342,563

342,563

494,813

The amount of non-cancellable operating lease payments recognised as an expense during the year was £152,250 (2022 - £218,642).

 

21

Share-based payments

Scheme details and movements

Doherty IT Solutions Limited operates equity-settled share-based remuneration schemes for its employees which are Enterprise Management Incentive ("EMI") schemes.

The options have no vesting period, but cannot be exercised until Group is listed on an exchange or the shares in the Group are sold such that control of the Group changes.

The fair value of the equity instruments granted was determined using the Black Scholes Model. This model was selected as it is a industry standard model. The share-remuneration expense for the year is not considered to be material and has not been recognised.

The movements in the number of share options during the year were as follows:

2023
Number

2022
Number

Outstanding, start of period

800

1,200

Granted during the period

870

-

Expired during the period

-

(400)

Outstanding, end of period

1,670

800

 

Doherty IT Solutions Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

21

Share-based payments (continued)

The movements in the weighted average exercise price of share options during the year were as follows:

2023
£

2022
£

Outstanding, start of period

300.00

300.00

Granted during the period

300.00

-

Expired during the period

-

(300.00)

Outstanding, end of period

300.00

300.00

Effect of share-based payments on profit or loss and financial position

No expense has been recognised in the profit and loss for the year or liability arising from share based payments included on the balance on the basis that neither are considered material to the results for the year or financial position at the year end.

 

22

Related party transactions

Group

Key management compensation

2023
£

2022
£

Salaries and other short term employee benefits

500,600

603,235

Post-employment benefits

59,524

41,941

560,124

645,176

Company

Summary of transactions with key management

Key management personnel are considered to be the directors of the company and key management personnel compensation is disclosed in note 8 to the financial statements.

Transactions with directors

During the year dividends of £438,362 (2022 - £201,640) were paid to shareholding directors of the company. All other shareholders waived their rights to any dividend.