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Registered number:  01136219














TARWAYS ASPHALTE CO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023


 
TARWAYS ASPHALTE CO LIMITED
 
 
COMPANY INFORMATION


Directors
D W Batterton 
T J Batterton 
R W Lowe 
D L Robinson 




Registered number
01136219



Registered office
Goodlass Road
Speke

Liverpool

Merseyside

L24 9HJ




Independent auditors
Langtons Professional Services Limited
Statutory Auditors & Chartered Accountants

The Plaza

100 Old Hall Street

Liverpool

L3 9QJ





 
TARWAYS ASPHALTE CO LIMITED
 

CONTENTS



Page
Strategic Report
 
1
Directors' Report
 
2 - 3
Independent Auditors' Report
 
4 - 7
Statement of Income and Retained Earnings
 
8
Statement of Financial Position
 
9 - 11
Analysis of Net Debt
 
11
Notes to the Financial Statements
 
12 - 29


 
TARWAYS ASPHALTE CO LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Business review
 
The Directors are pleased to report continued strong financial performance.
The general economic outlook remains challenging and uncertain in line with general trends, however the Directors continue to look forward with confidence to robust activity and significant profitability.

Principal risks and uncertainties
 
The management of the business and the execution of the company's strategy are subject to the normal commercial risks of our market sector.
The key business risks affecting the company are considered to relate to Health and Safety, contractual liability and non payment, however, we believe we have effective strategies in place to control and minimise these risks.

Financial key performance indicators
 
The company uses a range of industry specific, tailored KPIs to monitor the company's profitability and working capital requirements.


This report was approved by the board on 25 September 2024 and signed on its behalf.



D W Batterton
Director

Page 1

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £929,007 (2022 - £1,291,980).

Dividends totalling £787,546 (2022 - £695,113) were proposed and fully paid within the year. No final dividend is proposed.

Directors

The directors who served during the year were:

D W Batterton 
T J Batterton 
R W Lowe 
D L Robinson 

Future developments

The directors are satisfied with the result for the year and are positive for the future, based on the ongoing
improvement initiatives within the business.

Page 2

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditorsLangtons Professional Services Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 25 September 2024 and signed on its behalf.
 





D W Batterton
Director

Page 3

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TARWAYS ASPHALTE CO LIMITED
 

Opinion


We have audited the financial statements of Tarways Asphalte Co Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Income and Retained Earnings, the Statement of Financial Position and the related notes, including a summary of significant accounting policiesThe 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 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; 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


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.


Page 4

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TARWAYS ASPHALTE CO LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion 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 Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


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:


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.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 2, 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.


Page 5

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TARWAYS ASPHALTE CO LIMITED (CONTINUED)


Auditors' 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 Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.


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

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
The objectives of our audit, in respect to 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; and 
• to respond appropriately to fraud or suspected fraud identified during the audit. 
However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
Our approach was as follows: 
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company
and determined that the most significant are those that relate to the reporting framework (FRS 102 and
the Companies Act 2006), the relevant tax compliance regulations in the UK and the EU General Data
Protection Regulation (GDPR). 
We understood how the Company is complying with those frameworks by making enquiries of management. 
Through consideration of the results of our audit procedures we were able to either corroborate or provide contrary evidence which was then followed up.
Based on our understanding we designed our audit procedures to identify non-compliance with laws and regulations. Our procedures involved: 
• enquiries of management; and 
• journal entry testing, with a focus on journals indicating large or unusual transactions based on our
  understanding of the business. 
We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur by meeting with management to understand where it considered there was susceptibility to fraud. We also considered performance targets and their propensity to influence efforts made by management to manage revenue and earnings. Where the risk was considered to be higher, including areas impacting key performance indicators or management remuneration, we performed audit procedures to address each identified fraud risk or other risk of material misstatement. These procedures included those on revenue recognition detailed above, the assessment of items identified by management as non-recurring and testing manual journals and were designed to provide reasonable assurance that the financial statements were free from material fraud or error.
Page 6

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TARWAYS ASPHALTE CO LIMITED (CONTINUED)




A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


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 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Eifion Roberts (Senior Statutory Auditor)
  
for and on behalf of
Langtons Professional Services Limited
 
Statutory Auditors
Chartered Accountants
  
The Plaza
100 Old Hall Street
Liverpool
L3 9QJ

25 September 2024
Page 7

 
TARWAYS ASPHALTE CO LIMITED
 
 
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
22,288,280
25,142,164

Cost of sales
  
(18,533,297)
(21,378,484)

Gross profit
  
3,754,983
3,763,680

Administrative expenses
  
(2,433,319)
(2,186,914)

Other operating income
 5 
16,900
18,300

Operating profit
 6 
1,338,564
1,595,066

Interest receivable and similar income
 10 
72,383
55,542

Interest payable and similar expenses
 11 
(62,899)
(65,153)

Profit before tax
  
1,348,048
1,585,455

Tax on profit
 12 
(419,041)
(293,475)

Profit after tax
  
929,007
1,291,980

  

  

Retained earnings at the beginning of the year
  
4,935,763
4,338,896

  
4,935,763
4,338,896

Profit for the year
  
929,007
1,291,980

Dividends declared and paid
  
(787,546)
(695,113)

Retained earnings at the end of the year
  
5,077,224
4,935,763

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of income and retained earnings.

The notes on pages 12 to 29 form part of these financial statements.

Page 8

 
TARWAYS ASPHALTE CO LIMITED
REGISTERED NUMBER: 01136219

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 14 
946,703
1,108,165

Investments
 15 
18,897
18,897

Investment property
 16 
580,000
873,863

  
1,545,600
2,000,925

Current assets
  

Debtors
 17 
5,728,280
8,098,295

Cash at bank and in hand
 18 
1,648,516
465,540

  
7,376,796
8,563,835

Creditors: amounts falling due within one year
 19 
(2,901,305)
(4,643,288)

Net current assets
  
 
 
4,475,491
 
 
3,920,547

Total assets less current liabilities
  
6,021,091
5,921,472

Creditors: amounts falling due after more than one year
 20 
(630,942)
(790,165)

Provisions for liabilities
  

Deferred tax
 24 
(179,456)
(190,544)

  
 
 
(179,456)
 
 
(190,544)

Net assets
  
5,210,693
4,940,763


Capital and reserves
  

Called up share capital 
 25 
5,000
5,000

Revaluation reserve
 26 
128,469
-

Profit and loss account
 26 
5,077,224
4,935,763

  
5,210,693
4,940,763


Page 9

 
TARWAYS ASPHALTE CO LIMITED
REGISTERED NUMBER: 01136219
    
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2023

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 25 September 2024.




D W Batterton
R W Lowe
Director
Director



D L Robinson
Director




The notes on pages 12 to 29 form part of these financial statements.

Page 10

 
TARWAYS ASPHALTE CO LIMITED
REGISTERED NUMBER: 01136219

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023





At 1 January 2023
Cash flows
New finance leases
At 31 December 2023
£

£

£

£

Cash at bank and in hand

465,540

1,182,976

-

1,648,516

Debt due after 1 year

(409,202)

136,188

-

(273,014)

Finance leases

(716,206)

406,694

(246,386)

(555,898)


(659,868)
1,725,858
(246,386)
819,604

The notes on pages 12 to 29 form part of these financial statements.

Page 11

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Tarways Asphalte Co Limited is a private limited liability company, limited by shares, incorporated in England and Wales. The registered office is Goodlass Road, Speke, Liverpool, Merseyside, L24 9HJ and the company number is 01136219.
These financial statements present information about the company as an individual undertaking; it is a subsidiary of Directscale Limited who have prepared consolidated accounts.
The principal activity of the company is that of highways maintenance and surfacing contractors.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The presentation currency of these financial statements is pound sterling; the financial statements are rounded to the nearest pound.

The following principal accounting policies have been applied:

 
2.2

Going concern

The directors have a reasonable expectation that the company has adequate facilities to continue in
operational existence for the foreseeable future. They continue to believe the going concern basis of
accounting appropriate in preparing the annual financial statements.

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 12

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
2.5

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.6

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.7

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.8

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

Page 13

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

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

The current income 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 Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.10

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Plant and machinery
-
10% - 50% on cost
Motor vehicles
-
25%
Fixtures and fittings
-
10% - 50% on cost

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 14

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.11

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the reporting date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

 
2.12

Investment property

Investment property is carried at fair value determined annually by the directors and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in the Statement of Comprehensive Income.

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment. Where merger relief is applicable, the cost of the investment in a subsidiary undertaking is measured at the nominal value of the shares issued together with the fair value of any additional consideration paid.

 
2.14

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.15

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.16

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Page 15

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.17

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.18

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Company's Statement of Financial Position when the Company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying
Page 16

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.18
Financial instruments (continued)

amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

Page 17

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.19

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The directors have made judgements regarding the valuation of investment property, the depreciation of fixed assets and the value of bad debts.


4.


Turnover

The whole of the turnover is attributable to the principal activity of the company.

All turnover arose within the United Kingdom.


5.


Other operating income

2023
2022
£
£

Net rents receivable
18,450
18,300

Insurance claims receivable
(1,550)
-

16,900
18,300



6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Other operating lease rentals
130,570
125,203

Page 18

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
8,500
7,500

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.


8.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
1,748,926
1,916,415

Social security costs
196,117
232,700

Cost of defined contribution scheme
160,275
137,782

2,105,318
2,286,897


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Administration
12
12



Production
29
33

41
45


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
31,304
31,304

Company contributions to defined contribution pension schemes
36,000
36,000

67,304
67,304


During the year retirement benefits were accruing to 2 directors (2022 - 2) in respect of defined contribution pension schemes.

Page 19

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Interest receivable

2023
2022
£
£


Other interest receivable
72,383
55,542

72,383
55,542


11.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
30,532
21,530

Finance leases and hire purchase contracts
28,152
39,371

Other interest payable
4,215
4,252

62,899
65,153


12.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
433,152
275,599

Adjustments in respect of previous periods
(3,023)
(3,799)


Total current tax
430,129
271,800

Deferred tax


Origination and reversal of timing differences
(11,088)
21,675

Total deferred tax
(11,088)
21,675


Taxation on profit on ordinary activities
419,041
293,475
Page 20

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
12.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
1,348,048
1,585,455


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
317,068
301,236

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
26,130
19,043

Fixed asset differences
76,642
(11,572)

Adjustments to tax charge in respect of prior periods
(3,023)
(3,799)

Adjustments to tax charge in respect of prior periods - deferred tax
3,061
-

Additional deduction for R&D expenditure
-
(57,165)

Remeasurement of deferred tax for changes in tax rates
(837)
45,732

Total tax charge for the year
419,041
293,475


Factors that may affect future tax charges

There were no factors that may affect future tax charges.


13.


Dividends

2023
2022
£
£


Dividends
787,546
695,113

787,546
695,113

Page 21

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Tangible fixed assets





Plant and machinery
Motor vehicles
Fixtures and fittings
Total

£
£
£
£



Cost or valuation


At 1 January 2023
2,587,160
650,059
243,395
3,480,614


Additions
64,286
140,473
16,658
221,417


Disposals
(38,807)
(140,659)
-
(179,466)



At 31 December 2023

2,612,639
649,873
260,053
3,522,565



Depreciation


At 1 January 2023
1,642,608
503,649
226,192
2,372,449


Charge for the year on owned assets
28,920
2,035
14,121
45,076


Charge for the year on financed assets
241,221
84,425
-
325,646


Disposals
(33,956)
(133,351)
-
(167,307)



At 31 December 2023

1,878,793
456,758
240,313
2,575,864



Net book value



At 31 December 2023
733,846
193,115
19,740
946,701



At 31 December 2022
944,552
146,410
17,203
1,108,165

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Plant and machinery
723,972
900,907

Motor vehicles
192,732
143,992

916,704
1,044,899

Page 22

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Fixed asset investments





Investments in subsidiary companies

£



Cost or valuation


At 1 January 2023
18,897



At 31 December 2023
18,897





Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Landways Limited
Goodlass Road, Speke, Liverpool, Merseyside, L24 9HJ
Ordinary
100%

Page 23

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Investment property


Freehold investment property

£



Valuation


At 1 January 2023
873,863


Additions at cost
47,931


Disposals
(470,263)


Surplus on revaluation
128,469



At 31 December 2023
580,000

The 2023 valuations were made by the directors, on an open market value for existing use basis.



If the Investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:

2023
2022
£
£


Historic cost
451,531
873,863

451,531
873,863


17.


Debtors

2023
2022
£
£



Trade debtors
3,417,568
5,835,224

Amounts owed by group undertakings
1,842,001
1,518,549

Other debtors
436,490
712,500

Prepayments and accrued income
32,221
32,022

5,728,280
8,098,295


Page 24

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,648,516
465,540

1,648,516
465,540



19.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
2,128,548
3,886,448

Amounts owed to group undertakings
18,164
18,164

Corporation tax
433,153
275,601

Other taxation and social security
52,242
54,024

Obligations under finance lease and hire purchase contracts
197,970
335,244

Other creditors
31,009
31,009

Accruals and deferred income
40,219
42,798

2,901,305
4,643,288



20.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans
273,014
409,202

Net obligations under finance leases and hire purchase contracts
357,928
380,963

630,942
790,165


The following liabilities were secured:

2023
2022
£
£



Bank loans
273,014
409,202

Net obligations under finance leases and hire purchase contracts
555,898
716,206

828,912
1,125,408

Details of security provided:

Bank loans and obligations under finance leases and hire purchase contracts are secured on the assets
Page 25

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
concerned.

The aggregate amount of liabilities repayable wholly or in part more than five years after the reporting date is:

2023
2022
£
£


Repayable by instalments
273,014
409,202

273,014
409,202




21.


Loans


Analysis of the maturity of loans is given below:


2023
2022
£
£




Amounts falling due after more than 5 years

Bank loans
273,014
409,202

273,014
409,202



22.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

2023
2022
£
£


Within one year
252,138
287,820

Between 1-5 years
435,293
469,145

687,431
756,965

Page 26

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

23.


Financial instruments

2023
2022
£
£

Financial assets


Financial assets measured at fair value through profit or loss
1,648,516
465,540




Financial assets measured at fair value through profit or loss comprise cash at bank and in hand.


24.


Deferred taxation




2023
2022


£

£






At beginning of year
190,544
168,869


Charged to profit or loss
(11,088)
21,675



At end of year
179,456
190,544

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
179,456
190,544

179,456
190,544


25.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



5,000 (2022 - 5,000) Ordinary shares of £1.00 each
5,000
5,000


Page 27

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

26.


Reserves

Revaluation reserve

Revaluation reserve includes all current and prior period revaluations.

Profit and loss account

Includes all current and prior period retained profits and losses less dividends paid.


27.


Pension commitments

The Company operates a defined contributions pension scheme.
The assets of the scheme are held separately from those of the Company in an independently administered fund. 
The pension cost charge represents contributions payable by the Company to the fund and amounted to £124,275 (2022 - £102,620).
Contributions totalling £5,936 (2022 - £2,811) were payable to the fund at the balance sheet date.
During the year, the company made contributions to the directors personal pension plans.
Contributions paid in respect of the directors in aggregate is £36,000 (2022 -  £36,000).


28.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
81,853
64,342

Later than 1 year and not later than 5 years
-
15,870

81,853
80,212

29.

Related party transactions

The company has taken advantage of the exemption conferred under FRS102, as a wholly owned subsidiary, not to disclose balances and transactions with other group companies, as consolidated accounts of the ultimate parent company are available.
Tarways Asphalte Retirement Benefits Scheme
During the year, Tarways Asphalte Co Limited paid rent to Tarways Asphalte Retirement Benefits Scheme totalling £30,000 (2022 - £30,000).

Page 28

 
TARWAYS ASPHALTE CO LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

30.


Ultimate parent undertaking and controlling party

Directscale Limited is regarded by the directors as being the company's ultimate parent company.
Copies of accounts of Directscale Limited may be obtained from Companies House, Cardiff, CF14 3UZ.
The ultimate controlling party is D W Batterton, by virtue of his shareholding in the company's parent undertaking.

 
Page 29