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Company registration number: NI045412
E.J.C Contracts Ltd
Financial statements
31 May 2023
E.J.C Contracts Ltd
Contents
Directors and other information
Strategic report
Directors report
Independent auditor's report to the members
Statement of comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
E.J.C Contracts Ltd
Directors and other information
Directors Mr Edward Connolly
Mrs Clare Connolly (Resigned 3 May 2024)
Secretary Edward Connolly
Company number NI045412
Registered office 386A Ballyclare Road
Newtownabbey
Co Antrim
BT36 4TQ
Business address 386A Ballyclare Road
Newtownabbey
Co Antrim
BT36 4TQ
Auditor Miscampbell & Co
6 Annadale Avenue
Belfast
BT7 3JH
Accountants Business Account Services
11 Abbey Street
Armagh
BT61 7DX
E.J.C Contracts Ltd
Strategic report
Year ended 31 May 2023
The directors presents the strategic report for the year ended 31 May 2023.
Review of the business
The results for the year are shown on the Statement of Income and Retained Earnings on page 8.
The Company had a successful year, sales were up by 62%.
Principal risks and uncertainties
- Raw material availability and price: the Company monitors raw material sources and prices where appropriate with suppliers
- Environmental risks: the Company places considerable emphasis upon environmental compliance and not only seeks to ensure ongoing compliance with relevant legislation but also strives to ensure that environmental best practice is incorporated into its key processes
- Debtors: the Company maintains strong relationships with each of its key customers and has established credit control parameters. Appropriate credit terms are agreed with customers, and these are closely managed
- The effect of legislation or other regulatory activities: the Company monitors forthcoming and current legislation regularly
- Financial risk management: although the current risk is considered low, considerable effort is placed on managing cash and working capital to provide continued investment in capital
Development and performance
Key areas of strategic development and performance of the business include:
- Sales and marketing: new and replacement business is being won continually; new markets are being developed in line with Company strategy; key customer relationships are monitored on a regular basis
- Health and Safety: the Company continues to seek ways of ensuring that a safe and healthy working environment is progressively improved
Key performance indicators
2023 2022
Operating margin 18.05% 18.76%
Net margin 2.47% 2.54%
Working capital cover 4.27 5.28
The above KPls are used by the Directors to evaluate the profitability and liquidity of the Company.
Other performance indicators
There were no other key performance indicators.
This report was approved by the board of directors on 18 October 2024 and signed on behalf of the board by:
Mr Edward Connolly
Director
E.J.C Contracts Ltd
Directors report
Year ended 31 May 2023
The directors present their report and the financial statements of the company for the year ended 31 May 2023.
Principal activities
The principal activities of the company continued to be civil engineering, construction and associated activity or service.
Directors
The directors who served the company during the year were as follows:
Mr Edward Connolly
Mrs Clare Connolly (Resigned 3 May 2024)
Dividends
Particulars of recommended dividends are detailed in note 13 to the financial statements.
Future developments
The company is planning to expand into other regions.
Financial instruments
The company does not enter into any other form of external finance other than overdrafts and finance lease arrangements.
Events after the end of the reporting period
Particulars of events after the reporting period are detailed in note 27 to the financial statements.
Directors responsibilities statement
The directors are responsible for preparing the strategic report, directors report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgments and accounting estimates that are reasonable and prudent; and
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
Medium sized companies exemption
The report has been prepared in accordance with the provisons applicable to companies entitled to medium sized company exemptions.
This report was approved by the board of directors on 18 October 2024 and signed on behalf of the board by:
Mr Edward Connolly
Director
E.J.C Contracts Ltd
Independent auditor's report to the members of
E.J.C Contracts Ltd
Year ended 31 May 2023
Opinion
We have audited the financial statements of E.J.C Contracts Ltd (the 'company') for the year ended 31 May 2023 which comprise the statement of comprehensive income, statement of financial position, statement of changes in equity, statement of cash flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements: - give a true and fair view of the state of the company's affairs as at 31 May 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 auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other Information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the 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 has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, 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 the 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, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
- 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) and the relevant tax compliance regulation in the United Kingdom;
- Understood how the Company is complying with those frameworks by making enquiries of management to understand how the Company maintains and communicates its policies and procedures in these areas;
- Assessed the vulnerability of the Company’s financial statements to material misstatement, including how fraud might occur by considering the risk of management override and by assuming revenue recognition to be a fraud risk; and
- Based on this understanding our audit procedures were designed to identify non-compliance with such laws and regulations.
Based on our understanding of the company and industry, we apply professional scepticism throughout the audit and have considered the extent to which non-compliance of relevant legislation and the susceptibility to misstatement might have a material effect on the financial statements. We have evaluated management's opportunities for fraudulent manipulation of the financial statements and have determined that the principal risks were related to the posting of inappropriate journal entries in order to modify performance and management bias and assumptions in significant accounting estimates. Audit procedures performed by the engagement team included;
- Identification of related parties;
- Making enquiries of management regarding where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;
- Considering the internal controls in place within the company to mitigate the risk of fraud and non- compliance with laws and regulations;
- Review of applicable minutes;
- Identifying and testing journal entries and any other unusual postings.
To address the risk of fraud, override of controls and non-compliance with laws and regulations, we performed analytical procedures to identify any unusual or unexpected related party relationships, tested journal entries to identity unusual transactions, investigated any significant or unusual transactions and assessed whether judgements and assumptions made in determining the accounting estimates were suggestive of potential bias.
A further description of our responsibilities is located on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an 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.
Jonathan R Bethel (Senior Statutory Auditor)
For and on behalf of
Miscampbell & Co
Chartered Accountant and Statutory Auditor
6 Annadale Avenue
Belfast
BT7 3JH
18 October 2024
E.J.C Contracts Ltd
Statement of comprehensive income
Year ended 31 May 2023
2023 2022
Note £ £
Turnover 4 21,548,181 13,274,493
Cost of sales ( 17,658,263) ( 10,784,295)
_______ _______
Gross profit 3,889,918 2,490,198
Administrative expenses ( 3,340,231) ( 2,116,186)
Other operating income 5 2,606 5,000
_______ _______
Operating profit 6 552,293 379,012
Other interest receivable and similar income 9 1,239 24
Interest payable and similar expenses 10 ( 22,365) ( 41,839)
Profit before taxation 531,167 337,197
Tax on profit 11 ( 56,722) ( 30,845)
_______ _______
Profit for the financial year and total comprehensive income 474,445 306,352
_______ _______
All the activities of the company are from continuing operations.
E.J.C Contracts Ltd
Statement of financial position
31 May 2023
2023 2022
Note £ £ £ £
Fixed assets
Tangible assets 14 1,503,532 1,408,053
Investments 15 615,308 -
_______ _______
2,118,840 1,408,053
Current assets
Stocks 16 270,481 552,824
Debtors 17 856,698 829,518
Cash at bank and in hand 5,694,459 5,829,972
_______ _______
6,821,638 7,212,314
Creditors: amounts falling due
within one year 19 ( 1,599,051) ( 1,365,385)
_______ _______
Net current assets 5,222,587 5,846,929
_______ _______
Total assets less current liabilities 7,341,427 7,254,982
_______ _______
Net assets 7,341,427 7,254,982
_______ _______
Capital and reserves
Called up share capital 23 4 4
Profit and loss account 24 7,341,423 7,254,978
_______ _______
Shareholders funds 7,341,427 7,254,982
_______ _______
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
These financial statements were approved by the board of directors and authorised for issue on 18 October 2024 , and are signed on behalf of the board by:
Mr Edward Connolly
Director
Company registration number: NI045412
E.J.C Contracts Ltd
Statement of changes in equity
Year ended 31 May 2023
Called up share capital Profit and loss account Total
£ £ £
At 1 June 2021 4 7,311,788 7,311,792
Profit for the year 306,352 306,352
_______ _______ _______
Total comprehensive income for the year - 306,352 306,352
Dividends paid and payable ( 363,162) ( 363,162)
_______ _______ _______
Total investments by and distributions to owners - ( 363,162) ( 363,162)
_______ _______ _______
At 31 May 2022 and 1 June 2022 4 7,254,978 7,254,982
Profit for the year 474,445 474,445
_______ _______ _______
Total comprehensive income for the year - 474,445 474,445
Dividends paid and payable ( 388,000) ( 388,000)
_______ _______ _______
Total investments by and distributions to owners - ( 388,000) ( 388,000)
_______ _______ _______
At 31 May 2023 4 7,341,423 7,341,427
_______ _______ _______
E.J.C Contracts Ltd
Statement of cash flows
Year ended 31 May 2023
2023 2022
Note £ £
Cash flows from operating activities
Profit for the financial year 474,445 306,352
Adjustments for:
Depreciation of tangible assets 152,610 142,048
Government grant income ( 2,100) ( 5,000)
Other interest receivable and similar income ( 1,239) ( 24)
Interest payable and similar expenses 22,365 41,839
Gain/(loss) on disposal of tangible assets 2,585 -
Tax on profit 56,722 30,845
Accrued expenses/(income) 38,975 ( 409,152)
Changes in:
Stocks 282,343 ( 178,584)
Trade and other debtors ( 27,180) ( 205,868)
Trade and other creditors 145,696 297,605
_______ _______
Cash generated from operations 1,145,222 20,061
Interest paid ( 22,365) ( 41,839)
Interest received 1,239 24
Tax paid 1 ( 524,463)
_______ _______
Net cash from/(used in) operating activities 1,124,097 ( 546,217)
_______ _______
Cash flows from investing activities
Purchase of tangible assets ( 294,647) ( 285,852)
Proceeds from sale of tangible assets 43,973 -
Cash advances and loans granted ( 615,308) -
_______ _______
Net cash used in investing activities ( 865,982) ( 285,852)
_______ _______
Cash flows from financing activities
Directors loan 1,409 ( 7,071)
Government grant income 2,100 5,000
Equity dividends paid ( 388,000) ( 363,162)
_______ _______
Net cash used in financing activities ( 384,491) ( 365,233)
_______ _______
Net increase/(decrease) in cash and cash equivalents ( 126,376) ( 1,197,302)
Cash and cash equivalents at beginning of year 18 5,818,428 7,015,729
_______ _______
Cash and cash equivalents at end of year 18 5,692,052 5,818,427
_______ _______
E.J.C Contracts Ltd
Notes to the financial statements
Year ended 31 May 2023
1. General information
The company is a private company limited by shares, registered in Northern Ireland. The address of the registered office is 386A Ballyclare Road, Newtownabbey, Co Antrim, BT36 4TQ.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. and the requirements of the Companies Act 2006.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Monetary amounts in these financial statements are rounded to the nearest £.
Judgements and key sources of estimation uncertainty
In the application of the company'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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows. Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
Turnover
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
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.
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in capital and reserves. In this case, tax is recognised in other comprehensive income or directly in capital and reserves, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Tangible assets
tangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in capital and reserves, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in capital and reserves in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in capital and reserves in respect of that asset, the excess shall be recognised in profit or loss.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Freehold property - 2 % reducing balance
Plant and machinery - 20 % reducing balance
Fittings fixtures and equipment - 15 % reducing balance
Motor vehicles - 25 % reducing balance
If there is an indication that there has been a significant change in depreciation rate, useful life or residual value of tangible assets, the depreciation is revised prospectively to reflect the new estimates.
Fixed asset investments
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses. Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.
Impairment
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. When it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stocks to their present location and condition.
Hire purchase and finance leases
Assets held under finance leases are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
Financial instruments
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment. Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets or either assessed individually or grouped on the basis of similar credit risk characteristics. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised in finance costs in profit or loss in the period in which it arises.
4. Turnover
Turnover arises from:
2023 2022
£ £
Construction contracts 21,548,181 13,274,493
_______ _______
The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.
5. Other operating income
2023 2022
£ £
Government grant income 2,100 5,000
Other operating income 506 -
_______ _______
2,606 5,000
_______ _______
6. Operating profit
Operating profit is stated after charging/(crediting):
2023 2022
£ £
Depreciation of tangible assets 152,610 142,048
(Gain)/loss on disposal of tangible assets 2,585 -
Impairment of trade debtors - 81,087
Fees payable for the audit of the financial statements 3,000 3,600
_______ _______
7. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2023 2022
Administrative staff 56 30
_______ _______
The aggregate payroll costs incurred during the year were:
2023 2022
£ £
Wages and salaries 1,769,333 795,383
Social security costs 174,774 78,773
Other pension costs 45,091 16,644
_______ _______
1,989,198 890,800
_______ _______
8. Directors remuneration
The directors aggregate remuneration in respect of qualifying services was:
2023 2022
£ £
Remuneration 10,000 10,000
_______ _______
9. Other interest receivable and similar income
2023 2022
£ £
Bank deposits 1,239 24
_______ _______
10. Interest payable and similar expenses
2023 2022
£ £
Other loans made to the company:
Finance leases and hire purchase contracts 10,224 41,839
Other interest payable and similar expenses 12,141 -
_______ _______
22,365 41,839
_______ _______
11. Tax on profit
Major components of tax expense
2023 2022
£ £
Current tax:
UK current tax expense 56,722 30,845
_______ _______
Tax on profit 56,722 30,845
_______ _______
Reconciliation of tax expense
The tax assessed on the profit for the year is lower than (2022: lower than) the standard rate of corporation tax in the UK of 20.00 % (2022: 19.00%).
2023 2022
£ £
Profit before taxation 531,167 337,197
_______ _______
Profit multiplied by rate of tax 106,233 64,067
Effect of capital allowances and depreciation ( 49,511) ( 33,222)
_______ _______
Tax on profit 56,722 30,845
_______ _______
On 1 April 2023, the main rate of corporation tax increased from 19% to 25%. The rate above represents the effective rate of corporation tax.
12. Earnings per share
Basic earnings/(loss) per share
The earnings/(loss) and weighted average number of shares used in the calculation of basic earnings/(loss) per share are as follows:
2023 2022
£ £
Profit for the year attributable to the owners of the company 474,445 306,352
_______ _______
Diluted earnings/(loss) per share
The earnings/(loss) and weighted average number of shares used in the calculation of diluted earnings/(loss) per share are as follows:
2023 2022
£ £
Earnings/(loss) used in calculation of basic earnings/(loss) per share 474,445 306,352
_______ _______
13. Dividends
Equity dividends
2023 2022
£ £
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year) 388,000 363,162
_______ _______
14. Tangible assets
Freehold property Plant and machinery Fixtures, fittings and equipment Motor vehicles Total
£ £ £ £ £
Cost
At 1 June 2022 961,341 841,575 165,904 203,133 2,171,953
Additions 40,576 68,465 156,411 29,195 294,647
Disposals - ( 90,670) - - ( 90,670)
_______ _______ _______ _______ _______
At 31 May 2023 1,001,917 819,370 322,315 232,328 2,375,930
_______ _______ _______ _______ _______
Depreciation
At 1 June 2022 82,700 530,296 39,433 111,471 763,900
Charge for the year 9,299 81,167 35,506 26,638 152,610
Disposals - ( 44,112) - - ( 44,112)
_______ _______ _______ _______ _______
At 31 May 2023 91,999 567,351 74,939 138,109 872,398
_______ _______ _______ _______ _______
Carrying amount
At 31 May 2023 909,918 252,019 247,376 94,219 1,503,532
_______ _______ _______ _______ _______
At 31 May 2022 878,641 311,279 126,471 91,662 1,408,053
_______ _______ _______ _______ _______
15. Investments
Investment property Total
£ £
Cost
At 1 June 2022 - -
Additions 615,308 615,308
_______ _______
At 31 May 2023 615,308 615,308
_______ _______
Impairment
At 1 June 2022 and 31 May 2023 - -
_______ _______
Carrying amount
At 31 May 2023 615,308 615,308
_______ _______
At 31 May 2022 - -
_______ _______
16. Stocks
2023 2022
£ £
Work in progress 270,481 552,824
_______ _______
17. Debtors
2023 2022
£ £
Trade debtors 406,257 829,376
Other debtors 450,441 142
_______ _______
856,698 829,518
_______ _______
18. Cash and cash equivalents
2023 2022
£ £
Cash at bank and in hand 5,694,459 5,829,972
_______ _______
19. Creditors: amounts falling due within one year
2023 2022
£ £
Bank loans and overdrafts 42,358 51,495
Trade creditors 676,449 1,085,829
Accruals and deferred income 53,975 15,000
Corporation tax 72,783 16,060
Social security and other taxes 674,878 217,035
Director loan accounts 1,409 -
Other creditors 77,199 ( 20,034)
_______ _______
1,599,051 1,365,385
_______ _______
20. Employee benefits
The amount recognised in profit or loss in relation to defined contribution plans was £ 45,091 (2022: £ 16,644 ).
21. Government grants
The amounts recognised in the financial statements for government grants are as follows:
2023 2022
£ £
Recognised in other operating income:
Government grants recognised directly in income 2,100 5,000
_______ _______
22. Financial instruments
The carrying amount for each category of financial instrument is as follows:
2023 2022
£ £
Financial assets that are debt instruments measured at amortised cost
Trade debtors 406,257 829,376
Other debtors 450,441 142
Cash at bank and in hand 5,694,459 5,829,972
_______ _______
6,551,157 6,659,490
_______ _______
Financial liabilities measured at amortised cost
Bank and other loans 42,358 51,495
Trade creditors 676,449 1,085,829
Other creditors 880,244 228,061
_______ _______
1,599,051 1,365,385
_______ _______
23. Called up share capital
Issued, called up and fully paid
2023 2022
No £ No £
Ordinary shares shares of £ 1.00 each 4 4 4 4
_______ _______ _______ _______
24. Reserves
Profit and Loss Account includes all current and previous profits and losses.
25. Analysis of changes in net debt
At 1 June 2022 Cash flows At 31 May 2023
£ £ £
Cash and cash equivalents 5,829,972 (135,513) 5,694,459
Bank overdrafts (11,544) 9,137 (2,407)
Debt due within one year (39,951) (1,409) (41,360)
_______ _______ _______
5,778,477 ( 127,785) 5,650,692
_______ _______ _______
26. Operating leases
The company as lessee
The total future minimum lease payments under non-cancellable operating leases are as follows:
£ £
Not later than 1 year 36,000 -
Later than 1 year and not later than 5 years 36,000 -
_______ _______
72,000 -
_______ _______
Lease rentals represent temporary charges for working sites.
27. Events after the end of the reporting period
The company, after the reporting period, made a purchase of 50% of its issued share capital in May 2024. The effect of this transaction will be reflected in the subsequent reporting period.
28. Directors advances, credits and guarantees
During the year the directors entered into the following advances and credits with the company:
2023
Balance brought forward Advances /(credits) to the directors Amounts repaid Balance o/standing
£ £ £ £
Mr Edward Connolly - ( 323,650) 323,000 ( 650)
Mrs Clare Connolly - ( 65,759) 65,000 ( 759)
_______ _______ _______ _______
- ( 389,409) 388,000 ( 1,409)
_______ _______ _______ _______
2022
Balance brought forward Advances /(credits) to the directors Amounts repaid Balance o/standing
£ £ £ £
Mr Edward Connolly ( 5,955) ( 225,662) 231,617 -
Mrs Clare Connolly ( 1,116) ( 130,429) 131,545 -
_______ _______ _______ _______
( 7,071) ( 356,091) 363,162 -
_______ _______ _______ _______
29. Related party transactions
There was no related party transactions which the company was required to report under FRS102
30. Controlling party
The company is limited by share capital and is under the control of the directors