Company registration number 14670716 (England and Wales)
M G C INVESTMENT HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
M G C INVESTMENT HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mr P Hawkes
(Appointed 31 July 2024)
Mr RK Steer
(Appointed 31 July 2024)
Company number
14670716
Registered office
13 March Place
Gatehouse Way
Aylesbury
Buckinghamshire
HP19 8UG
Accountant
Gooding Accounts Ltd
24 Warminster Road
Westbury
Wiltshire
United Kingdom
BA13 3PE
Auditors
Byrd Link Audit and Accountancy Services Limited
Honeybourne Place
Jessop Avenue
Cheltenham
GL50 3SH
M G C INVESTMENT HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Notes to the financial statements
13 - 32
M G C INVESTMENT HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 1 -

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

Review of the business

 

The group’s principal activity during the year continued to be body repair and maintenance.

 

The groups key financial and other performance indicators during the year were as follows:

 

The groups turnover was £13,476,771 and the operating profit was £1,379,528. Performance was primarily driven by contract wins and improved operating efficiency.

 

Principal risks and uncertainties

 

The directors continually review and evaluate the risk that the group is facing. The groups’s operations expose it to a variety of financial risks that include the effects of exposure to price, credit liquidity and cash flow risk, along with foreign currency and legislation risk.

 

Currency fluctuations, trading arrangements, employment issues and other risks that become apparent over time will be monitored by management and mitigation put in place where possible.

 

Credit risk is the risk that one party to a financial instrument will cause a financial loss for that other party by failing to discharge an obligation. Company policies are aimed at minimising such losses and require that credit terms are only granted to customers who demonstrate an appropriate payment history and satisfy credit worthiness procedures.

 

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The company aims to mitigate liquidity risk by managing cash generation and tracking against forecast targets. The company participates in cash pooling arrangements with fellow UK subsidiaries whereby funds are cleared into a central account. Borrowing requirements are met through drawing funds through this pooling facility.

 

Development and performance

 

The directors expect the current level of activities to continue for the foreseeable future.

 

Key performance indicators

 

The directors are of the opinion that, given the nature of the business, analysis using non financial KPI's is not necessary or appropriate for an understanding of the development and performance of the company. The directors consider the data within the financial statements sufficient to enable a considered view of the company's performance to be undertaken.

On behalf of the board

Mr P Hawkes
Director
17 October 2024
M G C INVESTMENT HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 2 -

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

Principal activities

The principal activity of the company and group continued to be that of motor and miscellaneous repairs.

Results and dividends

The results for the period are set out on page 7.

Ordinary dividends were paid amounting to £160,000. The directors do not recommend payment of a final dividend.

Directors

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

Mr V Scudder
(Appointed 17 February 2023 and resigned 31 July 2024)
Mr DC Wareham
(Appointed 17 February 2023 and resigned 31 July 2024)
Mr P Hawkes
(Appointed 31 July 2024)
Mr RK Steer
(Appointed 31 July 2024)
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the period. These provisions remain in force at the reporting date.

Financial instruments
The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.
Cash flow risk

The group faces cash flow risk primarily due to the timing differences between payments to suppliers and receipts from customers. To mitigate this risk we closely monitor our trade debtors and trade creditors, maintain a strong cash reserve and have flexible credit facilities to ensure operational stability. We maintain separate bank accounts in which we hold funds for the payment of taxes to H M Revenue and Customs, allowing us to meet our liabilities when they come due.

 

Investments of cash surpluses, borrowing and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Price risk

Due to the vast majority of the group's work provision being contractual, price increases are passed on to work providers upon invoicing with proof of purchase invoices. There is no need to stock pile goods as the nature of their business does not require them to, as stock is minimal and specific to each vehicle repaired.

Post reporting date events

Post year-end, the shares of the company were sold, which led to a change in the key management personnel.

Auditor

In accordance with the company's articles, a resolution proposing that Byrd Link Audit and Accountancy Services Limited be reappointed as auditor of the group will be put at a General Meeting.

M G C INVESTMENT HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 3 -
Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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:

 

 

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

Statement of disclosure to auditor

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

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr P Hawkes
Director
17 October 2024
2024-10-17
M G C INVESTMENT HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF M G C INVESTMENT HOLDINGS LIMITED
- 4 -
Opinion

We have audited the financial statements of M G C Investment Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2023 which comprise the group profit and loss account, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

 

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

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

M G C INVESTMENT HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF M G C INVESTMENT HOLDINGS LIMITED
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 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.

 

M G C INVESTMENT HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF M G C INVESTMENT HOLDINGS LIMITED
- 6 -

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.

 

Based on our understanding of the company and its financial operations we have considered the initial risks of

non-compliance with the UK regulators, predominantly HM Revenue and Customs and Companies Act 2006. We

have assessed the impact of any breaches in such laws and regulations, based on the results of audit testing and

enquiries made with management, and considered whether any such findings would have a material impact on

these financial statements. We have considered the risk of those charged with management overriding internal

controls and the opportunity for financial manipulation. We have considered the effect of any accounting estimates

included within these accounts and the effect this may have on our audit opinion.

 

Our audit procedures together with our assessment of risks identified at planning were transparent to the company

and we have communicated with the client throughout the audit as well as the audit engagement team, and this

includes such matters as fraud and irregularity. The above procedures do however have their limitations as we can

only work on a sample of financial transactions. Ultimately it is the responsibility of those charged with

management for the prevention and detection of fraud and other irregularities. 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. This description forms part of our Report of the Auditors.

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including

those leading to a material misstatement in the financial statements or non-compliance with regulation. This

risk increases the more that compliance with a law or regulation is removed from the events and transactions

reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.

The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves

intentional concealment, forgery, collusion, omission or misrepresentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and

timing of the audit and significant audit findings, including any significant deficiencies in internal control that we

identify during our audit.

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.

Russel Byrd (FCA)
Senior Statutory Auditor
For and on behalf of Byrd LinkAudit and Accountancy Services Limited
17 October 2024
Honeybourne Place
Jessop Avenue
Cheltenham
GL50 3SH
M G C INVESTMENT HOLDINGS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 7 -
Period
ended
31 December
2023
Notes
£
Turnover
3
13,476,771
Cost of sales
(7,899,694)
Gross profit
5,577,077
Administrative expenses
(4,260,434)
Other operating income
62,885
Operating profit
4
1,379,528
Interest receivable and similar income
8
21,041
Interest payable and similar expenses
9
(33,664)
Amounts written off investments
10
(43,856)
Profit before taxation
1,323,049
Tax on profit
11
(407,054)
Profit for the financial period
27
915,995
Profit for the financial period is all attributable to the owners of the parent company.

The notes on pages 13 to 32 form part of these financial statements.

M G C INVESTMENT HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
Notes
£
£
Fixed assets
Goodwill
13
1,738,030
Tangible assets
14
255,679
1,993,709
Current assets
Stocks
17
122,977
Debtors
18
1,907,040
Cash at bank and in hand
2,246,378
4,276,395
Creditors: amounts falling due within one year
19
(3,207,615)
Net current assets
1,068,780
Total assets less current liabilities
3,062,489
Creditors: amounts falling due after more than one year
20
(1,495,429)
Provisions for liabilities
Deferred tax liability
23
10,965
(10,965)
Net assets
1,556,095
Capital and reserves
Called up share capital
25
101
Share premium account
26
799,999
Profit and loss reserves
27
755,995
Total equity
1,556,095

The notes on pages 13 to 32 form part of these financial statements.

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 17 October 2024 and are signed on its behalf by:
17 October 2024
Mr P Hawkes
Director
Company registration number 14670716 (England and Wales)
M G C INVESTMENT HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 9 -
2023
Notes
£
£
Fixed assets
Investments
15
3,200,000
Current assets
Debtors
18
100
Creditors: amounts falling due within one year
19
(280,000)
Net current liabilities
(279,900)
Total assets less current liabilities
2,920,100
Creditors: amounts falling due after more than one year
20
(2,139,595)
Net assets
780,505
Capital and reserves
Called up share capital
25
101
Share premium account
26
799,999
Profit and loss reserves
27
(19,595)
Total equity
780,505

The notes on pages 13 to 32 form part of these financial statements.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £140,405.

The financial statements were approved by the board of directors and authorised for issue on 17 October 2024 and are signed on its behalf by:
17 October 2024
Mr P Hawkes
Director
Company registration number 14670716 (England and Wales)
M G C INVESTMENT HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 10 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 17 February 2023
-
-
-
-
Period ended 31 December 2023:
Profit and total comprehensive income
-
-
915,995
915,995
Issue of share capital
25
101
799,999
-
800,100
Dividends
12
-
-
(160,000)
(160,000)
Balance at 31 December 2023
101
799,999
755,995
1,556,095

The notes on pages 13 to 32 form part of these financial statements.

M G C INVESTMENT HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 17 February 2023
-
-
-
-
Period ended 31 December 2023:
Profit and total comprehensive income
-
-
140,405
140,405
Issue of share capital
25
101
799,999
-
800,100
Dividends
12
-
-
(160,000)
(160,000)
Balance at 31 December 2023
101
799,999
(19,595)
780,505

The notes on pages 13 to 32 form part of these financial statements.

M G C INVESTMENT HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 12 -
2023
Notes
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
33
1,859,280
Interest paid
(33,664)
Income taxes paid
(150,751)
Net cash inflow/(outflow) from operating activities
1,674,865
Investing activities
Purchase of tangible fixed assets
(91,581)
Proceeds from disposal of tangible fixed assets
84,082
Purchase of subsidiaries, net of cash acquired
(1,668,525)
Interest received
21,041
Net cash used in investing activities
(1,654,983)
Financing activities
Proceeds from issue of shares
800,000
Increase in borrowings
732,055
New finance lesaes
35,238
Dividends paid to equity shareholders
(160,000)
Net cash generated from/(used in) financing activities
1,407,293
Net increase in cash and cash equivalents
1,427,175
Cash and cash equivalents at beginning of period
-
Cash and cash equivalents at end of period
1,427,175
Relating to:
Cash at bank and in hand
2,246,378
Bank overdrafts included in creditors payable within one year
(819,203)

The notes on pages 13 to 32 form part of these financial statements.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 13 -
1
Accounting policies
Company information

M G C Investment Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 13 March Place, Gatehouse Way, Aylesbury, Buckinghamshire, HP19 8UG.

 

The group consists of M G C Investment Holdings Limited and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

 

The principal accounting policies adopted are set out below.

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company M G C Investment Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

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

1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services

provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair

value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is

the present value of the future receipts. The difference between the fair value of the consideration and the

nominal amount received is recognised as interest income.

 

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the

goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured

reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the

costs incurred or to be incurred in respect of the transaction can be measured reliably.

 

Revenue from contracts for the provision of professional services is recognised by reference to the stage of

completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The

stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff

rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue

is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.6
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 years.

 

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

1.7
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Straight line over the life of the lease
Plant and equipment
25% straight line
Fixtures and fittings
30% reducing balance
Motor vehicles
25% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.8
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

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

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.9
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.10
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

 

Cost is calculated using the weighted average method.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.11
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.12
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

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

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

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

1.13
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

1.14
Taxation

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

Current tax

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

Deferred tax

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

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.15
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.16
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.17
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

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

1.18
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
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 amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

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

3
Turnover and other revenue
2023
£
Turnover analysed by class of business
Sale of goods
8,573,180
Rendering of services
4,903,591
13,476,771
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 20 -
2023
£
Other revenue
Interest income
21,041
Commissions received
8,596
4
Operating profit
2023
£
Operating profit for the period is stated after charging:
Depreciation of owned tangible fixed assets
43,032
Loss on disposal of tangible fixed assets
2,699
Amortisation of intangible assets
336,710
Operating lease charges
408,057
5
Auditor's remuneration
2023
Fees payable to the company's auditor and associates:
£
For audit services
Audit of the financial statements of the group and company
24,000
6
Employees

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

Group
Company
2023
2023
Number
Number
148
-
0
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 21 -

Their aggregate remuneration comprised:

Group
Company
2023
2023
£
£
Wages and salaries
3,980,470
-
0
Social security costs
369,573
-
Pension costs
169,015
-
0
4,519,058
-
0
7
Directors' remuneration
2023
£
Remuneration for qualifying services
186,650
Amounts receivable under long term incentive schemes
81,747
268,397

Highest paid director

 

As total directors' remuneration was less than £200,000 in the current period, no disclosure is provided for that period.

8
Interest receivable and similar income
2023
£
Interest income
Interest on bank deposits
20,009
Other interest income
1,032
Total income
21,041
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 22 -
9
Interest payable and similar expenses
2023
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
11,246
Interest on convertible loan notes
19,595
30,841
Other finance costs:
Interest on finance leases and hire purchase contracts
2,823
Total finance costs
33,664
10
Amounts written off investments
2023
£
Amounts written off current loans
(43,856)
11
Taxation
2023
£
Current tax
UK corporation tax on profits for the current period
428,058
Deferred tax
Origination and reversal of timing differences
(21,004)
Total tax charge
407,054
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
11
Taxation
(Continued)
- 23 -

The actual charge for the period can be reconciled to the expected charge/(credit) for the period based on the profit or loss and the standard rate of tax as follows:

2023
£
Profit before taxation
1,323,049
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52%
311,181
Tax effect of expenses that are not deductible in determining taxable profit
4,609
Amortisation on assets not qualifying for tax allowances
72,138
Deferred tax adjustments in respect of prior years
(11,730)
Super deduction
(103)
Elimination of pre acquisition trade
30,959
Taxation charge
407,054

The standard rate of corporation tax has changed from the previous period due to changes in government legislation.

12
Dividends
2023
Recognised as distributions to equity holders:
£
Final paid
160,000
13
Intangible fixed assets
Group
Goodwill
£
Cost
At 17 February 2023
-
0
Additions - separately acquired
2,044,741
Additions - business combinations
29,999
At 31 December 2023
2,074,740
Amortisation and impairment
At 17 February 2023
-
0
Amortisation charged for the period
336,710
At 31 December 2023
336,710
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
13
Intangible fixed assets
(Continued)
- 24 -
Carrying amount
At 31 December 2023
1,738,030
The company had no intangible fixed assets at 31 December 2023.
14
Tangible fixed assets
Group
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 17 February 2023
-
0
-
0
-
0
-
0
-
0
Additions
-
0
5,092
7,989
78,500
91,581
Business combinations
10,065
238,709
43,997
1,140
293,911
Disposals
-
0
(9,743)
-
0
(78,500)
(88,243)
At 31 December 2023
10,065
234,058
51,986
1,140
297,249
Depreciation and impairment
At 17 February 2023
-
0
-
0
-
0
-
0
-
0
Depreciation charged in the period
787
30,298
11,662
285
43,032
Eliminated in respect of disposals
-
0
(1,462)
-
0
-
0
(1,462)
At 31 December 2023
787
28,836
11,662
285
41,570
Carrying amount
At 31 December 2023
9,278
205,222
40,324
855
255,679
The company had no tangible fixed assets at 31 December 2023.
15
Fixed asset investments
Group
Company
2023
2023
Notes
£
£
Investments in subsidiaries
16
-
0
3,200,000
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
15
Fixed asset investments
(Continued)
- 25 -
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 17 February 2023
-
Additions
3,200,000
At 31 December 2023
3,200,000
Carrying amount
At 31 December 2023
3,200,000
16
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
M G Cannon Limited
13 March Place, Gatehouse Way, Aylesbury, Buckinghamshire, England, HP19 8UG
Body repair and maintenance
Ordinary
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
M G Cannon Limited
2,237,560
1,373,928
17
Stocks
Group
Company
2023
2023
£
£
Raw materials and consumables
115,509
-
Work in progress
7,468
-
122,977
-
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 26 -
18
Debtors
Group
Company
2023
2023
Amounts falling due within one year:
£
£
Trade debtors
1,605,624
-
0
Unpaid share capital
100
100
Other debtors
79,329
-
0
Prepayments and accrued income
221,987
-
0
1,907,040
100
19
Creditors: amounts falling due within one year
Group
Company
2023
2023
Notes
£
£
Bank loans and overdrafts
21
819,203
-
0
Obligations under finance leases
22
7,154
-
0
Other borrowings
21
183,955
80,000
Trade creditors
658,361
-
0
Corporation tax payable
428,058
-
0
Other taxation and social security
547,577
-
Other creditors
363,350
200,000
Accruals and deferred income
199,957
-
0
3,207,615
280,000

Included in other creditors is an amount of £73,000 (2022: £73,000) which is secured on all assets. Also included in other creditors is an amount of £7,154 (2022: Nil) which is secured on the group's vehicles.

20
Creditors: amounts falling due after more than one year
Group
Company
2023
2023
Notes
£
£
Obligations under finance leases
22
28,084
-
0
Other borrowings
21
867,345
1,539,595
Other creditors
600,000
600,000
1,495,429
2,139,595

Included in other creditors is an amount of £127,750 (2022: £200,750) which is secured on all assets. Also included in other creditors is an amount of £28,084 (2022: Nil) which is secured on the group's vehicles.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 27 -
21
Loans and overdrafts
Group
Company
2023
2023
£
£
Bank overdrafts
819,203
-
0
Loans from group undertakings
-
0
800,000
Other loans
1,051,300
819,595
1,870,503
1,619,595
Payable within one year
1,003,158
80,000
Payable after one year
867,345
1,539,595

The long-term loans include Barclays loan secured by fixed charges, a floating charge and contains negative pledge.

22
Finance lease obligations
Group
Company
2023
2023
£
£
Future minimum lease payments due under finance leases:
Within one year
7,154
-
0
In two to five years
28,084
-
0
35,238
-

Finance lease payments represent rentals payable by the group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is five years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

23
Deferred taxation

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

Liabilities
2023
Group
£
Accelerated capital allowances
16,275
Retirement benefit obligations
(5,310)
10,965
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
23
Deferred taxation
(Continued)
- 28 -
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the period:
£
£
Asset at 17 February 2023
-
-
Charge to profit or loss
10,965
-
Liability at 31 December 2023
10,965
-
24
Retirement benefit schemes
2023
Defined contribution schemes
£
Charge to profit or loss in respect of defined contribution schemes
169,015

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

25
Share capital
Group and company
2023
2023
Ordinary share capital
Number
£
Issued and not fully paid
Ordinary Shares of £1 each
100
100
2023
2023
Preference share capital
Number
£
Issued and fully paid
Preference shares of £1 each
1
1
Preference shares classified as equity
1
Total equity share capital
101
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
25
Share capital
(Continued)
- 29 -

Ordinary shares:

 

Each share is entitled to one vote in any circumstances. Each share is entitled to share equally in dividend payments or any other distribution.

 

Preference shares:

 

Non-redeemable, non-voting preference share.

26
Share premium account
Group
Company
2023
2023
£
£
At the beginning of the period
-
0
-
0
Issue of new shares
799,999
799,999
At the end of the period
799,999
799,999
27
Profit and loss reserves
Group
Company
2023
2023
£
£
At the beginning of the period
-
-
Profit for the period
915,995
140,405
Dividends
(160,000)
(160,000)
At the end of the period
755,995
(19,595)
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 30 -
28
Acquisition of a business

On 9 March 2023 the group acquired 100 percent of the issued capital of M G Cannon Limited.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Intangible assets
29,999
-
29,999
Property, plant and equipment
293,911
-
293,911
Inventories
161,480
-
161,480
Trade and other receivables
1,419,310
-
1,419,310
Cash and cash equivalents
2,011,378
-
2,011,378
Borrowings
(799,147)
-
(799,147)
Trade and other payables
(1,778,952)
-
(1,778,952)
Tax liabilities
(150,751)
-
(150,751)
Deferred tax
(31,969)
-
(31,969)
Total identifiable net assets
1,155,259
-
1,155,259
Goodwill
2,044,741
Total consideration
3,200,000
The consideration was satisfied by:
£
Cash
2,400,000
Deferred consideration
800,000
3,200,000
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
13,476,771
Profit after tax
935,590
M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 31 -
29
Operating lease commitments
Lessee

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

Group
Company
2023
2023
£
£
Within one year
772,730
-
Between two and five years
3,090,918
-
In over five years
1,047,676
-
4,911,324
-
30
Events after the reporting date

Post year-end, the shares of the company were sold, which led to a change in the key management personnel.

31
Related party transactions
Transactions with related parties

During the period the group entered into the following transactions with related parties:

Sales
Purchases
2023
2023
£
£
Group
Computers Dotcom Limited
40,018
30,769

The following amounts were outstanding at the reporting end date:

Amounts due to related parties
2023
£
Group
Computers Dotcom Limited
1,027
32
Controlling party

The controlling party at year-end was V Scudder. Refer to note 26 for further information.

M G C INVESTMENT HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 32 -
33
Cash generated from/(absorbed by) group operations
2023
£
Profit for the period after tax
915,995
Adjustments for:
Taxation charged
407,054
Finance costs
33,664
Investment income
(21,041)
Loss on disposal of tangible fixed assets
2,699
Amortisation and impairment of intangible assets
336,710
Depreciation and impairment of tangible fixed assets
43,032
Movements in working capital:
Decrease in stocks
38,503
Increase in debtors
(487,629)
Increase in creditors
590,293
Cash generated from/(absorbed by) operations
1,859,280
34
Analysis of changes in net funds - group
17 February 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
-
2,246,378
2,246,378
Bank overdrafts
-
(819,203)
(819,203)
-
1,427,175
1,427,175
Borrowings excluding overdrafts
-
(1,051,300)
(1,051,300)
Obligations under finance leases
-
(35,238)
(35,238)
-
340,637
340,637
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