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Company Registration Number 07308930























GRAIN COMMUNICATIONS LIMITED





FINANCIAL STATEMENTS





 31 MARCH 2024

























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GRAIN COMMUNICATIONS LIMITED
REGISTERED NUMBER: 07308930

STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024

2024
2023
Note
£
£

Fixed assets
  

Intangible assets
 5 
130,571
3,083

Tangible assets
 6 
96,357,198
47,678,328

  
96,487,769
47,681,411

Current assets
  

Debtors: amounts falling due after more than one year
 7 
5,268,988
4,156,133

Debtors: amounts falling due within one year
 7 
15,350,543
7,337,332

Cash at Bank and in hand
  
286,619
292,181

  
20,906,150
11,785,646

Creditors: amounts falling due within one year
 8 
(116,022,385)
(55,889,249)

Net current liabilities
  
 
 
(95,116,235)
 
 
(44,103,603)

Total assets less current liabilities
  
1,371,534
3,577,808

Creditors: amounts falling due after more than one year
 9 
(2,674,547)
(1,329,033)

Provisions for liabilities
  

Other provisions
  
(21,459)
(21,459)

  
 
 
(21,459)
 
 
(21,459)

Net (liabilities)/assets
  
(1,324,472)
2,227,316


Capital and reserves
  

Called up share capital 
 10 
100
100

Profit and loss account
  
(1,324,572)
2,227,216

  
(1,324,472)
2,227,316

Page 1

 
GRAIN COMMUNICATIONS LIMITED
REGISTERED NUMBER: 07308930

STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 MARCH 2024

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.

The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.

The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


Mr Roland Barzegar
Director

Date: 27 September 2024

The notes on pages 3 to 9 form part of these financial statements.
Page 2

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

1.


General information

Grain Communications Limited is a private company, limited by shares, incorporated in England & Wales, registered number 07308930. The registered office is Clifford House Cooper Way, Parkhouse, Carlisle, CA3 0JG.

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 FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The following principal accounting policies have been applied:

 
2.2

Going concern

The company had net liabilities of £1,324k (2023: net assets of £2,227k) and net current liabilities of £95,116k (2023: net current liabilities of £44,104k). 
The company is building network infrastructure for use by its parent company, Grain Connect Limited. Charges are being levied for the use of that network infrastructure, but because charges are only levied for completed networks, the income generated by the assets is lagging the cost of the building of those assets. The infrastructure build is being financed via loans from the parent company which is repayable on demand totalling £112,800k, causing the net current liability position. However, these amounts would not be recalled if doing so would prejudice the ability of this company to continue as a going concern. 
As such, the directors consider the company to be a going concern and have prepared the accounts on that basis. 

 
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:

Use of network assets
Revenue includes a contractual sum due from a group company in respect of the use of Grain Communication Limited’s network assets. 

 
2.4

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.

Page 3

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.5

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.

  
2.6

Intangible fixed assets and amortisation - other intangible

Other intangible assets consist of a licence from Ofcom to operate fibre networks. It is amortised to profit and loss account over its estimated useful economic life of 10 years.

 
2.7

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:

Long-term leasehold property
-
12 years straight line
Plant and machinery
-
3 to 25 years straight line

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 4

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Recognition of deferred tax asset
Deferred tax assets should only be recognised where it is probable that future taxable profits will be made against which the potential asset can be utilised. 
The directors have considered the performance of the company against business plans at the group level, since these losses could be offset against the taxable profits of other companies in the group in future. Performance is tracking favourably against those plans, which forecast profitability in the medium term. The directors have determined that there is a probability that the assets will be utilised in future on the grounds that the forecast profitability is more likely than not to arise. The directors have determined that, because the company would be required to consent to any relief of losses to group companies, it is appropriate to recognise the asset as an asset of this company.
This is a significant judgement taken in the preparation of these accounts, given the magnitude of the deferred tax asset recognised. There is inherently uncertainty as to whether the forecast profitability will be realised. 
Depreciation
Tangible fixed assets are depreciated over their estimated useful economic life, to a residual value at the end of that useful economic life.
Determining both the useful economic life and residual values for assets involve forecasting future events, and as such there is inherently uncertainty in these estimates. Because of the materiality of tangible fixed assets to these accounts, and the early-stage nature of the company meaning that there is limited track record against which to benchmark these estimates, the directors have identified depreciation as a key source of estimation uncertainty in these accounts.
Work has been undertaken to determine accurate estimates for both the useful economic lives and residual values, particularly by benchmarking those values against industry averages.


4.


Employees




The Company has no employees other than the directors, who did not receive any remuneration (2023 - £NIL).

Page 5

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

5.


Intangible assets




License

£



Cost


At 1 April 2023
10,000


Additions
142,764



At 31 March 2024

152,764



Amortisation


At 1 April 2023
6,917


Charge for the year on owned assets
15,276



At 31 March 2024

22,193



Net book value



At 31 March 2024
130,571



At 31 March 2023
3,083



Page 6

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

6.


Tangible fixed assets





Leasehold property
Network infrastructure, plant, and machinery
Total

£
£
£



Cost or valuation


At 1 April 2023
40,406
49,170,369
49,210,775


Additions
-
52,687,130
52,687,130



At 31 March 2024

40,406
101,857,499
101,897,905



Depreciation


At 1 April 2023
30,847
1,501,600
1,532,447


Charge for the year on owned assets
3,367
4,004,893
4,008,260



At 31 March 2024

34,214
5,506,493
5,540,707



Net book value



At 31 March 2024
6,192
96,351,006
96,357,198



At 31 March 2023
9,559
47,668,769
47,678,328
Page 7

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

7.


Debtors

2024
2023
£
£

Due after more than one year

Deferred tax asset
5,268,988
4,156,133

5,268,988
4,156,133


2024
2023
£
£

Due within one year

Prepayments and accrued income
63,892
118,900

Other debtors
694,119
1,346,333

Amounts owed by group undertakings
14,592,532
5,872,099

15,350,543
7,337,332



8.


Creditors: Amounts falling due within one year

2024
2023
£
£

Trade creditors
772,812
2,186,171

Amounts owed to group undertakings
112,799,567
51,040,461

Other taxation and social security
12,159
89,292

Accruals and deferred income
2,437,847
2,573,325

116,022,385
55,889,249



9.


Creditors: Amounts falling due after more than one year

2024
2023
£
£

Other creditors
2,674,547
1,329,033

2,674,547
1,329,033


Page 8

 
GRAIN COMMUNICATIONS LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

10.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



100 (2023 - 100) Ordinary shares of £1.00 each
100
100



11.


Commitments under operating leases

At 31 March 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2024
2023
£
£


Not later than 1 year
6,000
6,000

Later than 1 year and not later than 5 years
15,500
21,500

21,500
27,500


12.


Controlling party

The ultimate parent company of the entity and the parent of the largest group that consolidates these accounts is Grain Connect Topco Limited. The company's immediate parent company is Grain Connect Limited. The registered office address of both of these companies is Clifford House, Cooper Way, Parkhouse, Carlisle, United Kingdom, CA3 0JG.
There is no ultimate controlling party.


13.


Auditors' information

The auditors' report on the financial statements for the year ended 31 March 2024 was unqualified.

The audit report was signed on 27 September 2024 by Joanna Gray (Senior Statutory Auditor) on behalf of Armstrong Watson Audit Limited.

Page 9