Company Registration No. 04977957 (England and Wales)
PUBLIC SEWER SERVICES LIMITED
ANNUAL REPORT AND
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PUBLIC SEWER SERVICES LIMITED
COMPANY INFORMATION
Directors
Mr A I Boyle
(Appointed 2 February 2024)
Mr H V Pedersen
(Appointed 2 February 2024)
Company number
04977957
Registered office
80 Station Parade
Harrogate
North Yorkshire
HG1 1HQ
Auditor
Maynard Heady LLP
Matrix House
12-16 Lionel Road
Canvey Island
Essex
SS8 9DE
Business address
The Old Boatyard
Rochehall Way
Purdeys Industrial Estate
Rochford
Essex
SS4 1JU
PUBLIC SEWER SERVICES LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 21
PUBLIC SEWER SERVICES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
The principal activity of the company is that of water and drainage clearance and repair.
The directors aim to present a report that as a whole is fair, balanced and understandable and should provide the information necessary for shareholders to assess the entity’s performance, business model and strategy.
Founded in 1989 Public Sewer Services has over 30 years in the industry and provides an in-house one stop solution for all aspects of water and drainage, including open cut excavation, tankering, CCTV, blockage clearance and root cutting. The company has also heavily invested in innovative no dig technology.
The focused management team have continued to maintain profitability during the year and continues to meets its five year strategic business plan.
On 2 February 2024, 100% of the share capital of Public Sewer Services Limited was acquired by Adler and Allan Limited, a company that provides environmental risk reduction through preventative and responsive solutions.
Principal risks and uncertainties
The industry in which Public Sewer operates continues to be a very competitive market place with a downward pressure on margins and sales. Despite this pressure the company has managed to increase its turnover.
The company has limited exposure to finance risk as its only investment is £100 in a dormant company and has a low gearing ratio. In addition all its operations are invoiced and completed in the UK so there is no currency risk.
The board has procedures in place to identify any risks to the business.
Financial performance
The results for the year are shown on page 7 to the accounts.
The directors are confident of being able to maintain the level of revenue for the forthcoming year and continue to achieve profitable results.
Mr A I Boyle
Director
7 October 2024
PUBLIC SEWER SERVICES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of water and drainage clearance and repair.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr L Freeman
(Resigned 2 February 2024)
Mrs A Gawthorn
(Resigned 2 February 2024)
Ms J Theobald
(Resigned 2 February 2024)
Mr A I Boyle
(Appointed 2 February 2024)
Mr H V Pedersen
(Appointed 2 February 2024)
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid during the year amounting to £1,440,000. The directors do not recommend payment of a final dividend.
Auditor
Maynard Heady LLP were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
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 company’s auditor 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 company’s auditor is aware of that information.
On behalf of the board
Mr A I Boyle
Director
7 October 2024
PUBLIC SEWER SERVICES LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and 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.
PUBLIC SEWER SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PUBLIC SEWER SERVICES LIMITED
- 4 -
Opinion
We have audited the financial statements of Public Sewer Services Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the balance sheet, the statement of changes in equity, the 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:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
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:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
PUBLIC SEWER SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PUBLIC SEWER SERVICES LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of 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.
Enquiry of management, those charged with governance around actual and potential litigation and claims.
Enquiry of entity staff in tax and compliance functions to identify any instances of non-compliance with laws and regulations.
Reviewing minutes of meetings of those charged with governance.
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities including those leading to material misstatement in the financial statements or non-compliance with laws and regulations. This risk increases the more that compliance with a law and 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.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's 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.
PUBLIC SEWER SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PUBLIC SEWER SERVICES LIMITED
- 6 -
Stephanie Caten FCA CTA (Senior Statutory Auditor)
for and on behalf of Maynard Heady LLP
7 October 2024
Chartered Accountants
Statutory Auditor
Matrix House
12-16 Lionel Road
Canvey Island
Essex
SS8 9DE
PUBLIC SEWER SERVICES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
£
£
Turnover
2
19,634,488
17,285,941
Cost of sales
(13,500,000)
(11,464,183)
Gross profit
6,134,488
5,821,758
Administrative expenses
(3,961,981)
(3,044,393)
Operating profit
5
2,172,507
2,777,365
Interest receivable and similar income
6
28,267
2,133
Interest payable and similar expenses
7
(239)
Profit before taxation
2,200,774
2,779,259
Tax on profit
8
(309,827)
(348,988)
Profit for the financial year
1,890,947
2,430,271
The profit and loss account has been prepared on the basis that all operations are continuing operations.
There is no other comprehensive income.
PUBLIC SEWER SERVICES LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
3,272,410
2,898,892
Investments
12
100
100
3,272,510
2,898,992
Current assets
Stocks
13
501,321
354,699
Debtors
14
2,404,356
2,754,172
Cash at bank and in hand
3,093,781
2,091,244
5,999,458
5,200,115
Creditors: amounts falling due within one year
15
(2,792,927)
(2,136,937)
Net current assets
3,206,531
3,063,178
Total assets less current liabilities
6,479,041
5,962,170
Provisions for liabilities
Deferred tax liability
16
619,318
553,394
(619,318)
(553,394)
Net assets
5,859,723
5,408,776
Capital and reserves
Called up share capital
19
10,100
10,100
Revaluation reserve
85,000
85,000
Profit and loss reserves
5,764,623
5,313,676
Total equity
5,859,723
5,408,776
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 7 October 2024 and are signed on its behalf by:
Mr A I Boyle
Director
Company registration number 04977957 (England and Wales)
PUBLIC SEWER SERVICES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2022
10,100
85,000
4,173,405
4,268,505
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
2,430,271
2,430,271
Dividends
10
-
-
(1,290,000)
(1,290,000)
Balance at 31 December 2022
10,100
85,000
5,313,676
5,408,776
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
1,890,947
1,890,947
Dividends
10
-
-
(1,440,000)
(1,440,000)
Balance at 31 December 2023
10,100
85,000
5,764,623
5,859,723
PUBLIC SEWER SERVICES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
3,908,805
3,558,667
Interest paid
(239)
Income taxes paid
(196,919)
(153,870)
Net cash inflow from operating activities
3,711,886
3,404,558
Investing activities
Purchase of tangible fixed assets
(1,353,964)
(1,100,812)
Proceeds from disposal of tangible fixed assets
56,348
79,013
Interest received
28,267
2,133
Net cash used in investing activities
(1,269,349)
(1,019,666)
Financing activities
Repayment of bank loans
(15,815)
Dividends paid
(1,440,000)
(1,290,000)
Net cash used in financing activities
(1,440,000)
(1,305,815)
Net increase in cash and cash equivalents
1,002,537
1,079,077
Cash and cash equivalents at beginning of year
2,091,244
1,012,167
Cash and cash equivalents at end of year
3,093,781
2,091,244
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information
Public Sewer Services Limited is a private company limited by shares incorporated in England and Wales. The registered office is 80 Station Parade, Harrogate, North Yorkshire, HG1 1HQ.
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 financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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.
1.3
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.
Work in progress is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. Turnover is only recognised to the extent of recoverable expenses when the outcome of a contract cannot be estimated reliably.
1.4
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.
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:
Land and buildings Leasehold
Over term of lease
Leasehold improvements
Over term of lease
Plant and machinery
20% on cost
Fixtures, fittings and equipment
33% on cost
Motor vehicles
20% on cost
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 credited or charged to profit or loss.
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
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.
1.7
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.
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.
1.8
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.
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.9
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include 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 company 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 company after deducting all of its liabilities.
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
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.
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 company’s contractual obligations expire or are discharged or cancelled.
1.10
Equity instruments
Equity instruments issued by the company 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 company.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.11
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
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 when the company has 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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
2
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Sales
19,634,488
17,285,941
2023
2022
£
£
Other revenue
Interest income
28,267
2,133
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Employees
146
130
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Employees
(Continued)
- 16 -
2023
2022
£
£
Wages and salaries
6,957,537
5,828,294
Social security costs
755,704
657,620
Pension costs
136,159
126,248
7,849,400
6,612,162
4
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
63,135
58,896
Company pension contributions to defined contribution schemes
1,332
4,618
64,467
63,514
5
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Other audit fees
10,000
10,000
Depreciation of owned tangible fixed assets
954,417
828,177
(Profit)/loss on disposal of tangible fixed assets
(30,319)
78,576
6
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
17,513
134
Other interest income
10,754
1,999
Total income
28,267
2,133
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
17,513
134
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
156
Other finance costs:
Other interest
83
239
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
455,496
466,813
Adjustments in respect of prior periods
(211,593)
(278,676)
Total current tax
243,903
188,137
Deferred tax
Origination and reversal of timing differences
65,924
160,851
Total tax charge
309,827
348,988
The tax rate changed from 19% to 25% on 1st April 2023 making the hybrid tax rate for the year 23.52%.
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
2,200,774
2,779,259
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
517,622
528,059
Tax effect of expenses that are not deductible in determining taxable profit
2,143
(6,518)
Under/(over) provided in prior years
(211,593)
(278,676)
Deferred tax
65,924
160,850
Depreciation not deductible
224,479
157,354
Profit on sale of fixed assets
(7,131)
14,930
Capital allowances
(281,800)
(222,637)
Pension adjustment
183
(4,374)
Taxation charge for the year
309,827
348,988
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
9
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
246,206
90,165
Between two and five years
382,106
42,568
628,312
132,733
10
Dividends
2023
2022
£
£
Interim paid
1,440,000
1,290,000
11
Tangible fixed assets
Land and buildings Leasehold
Leasehold improvements
Plant and machinery
Fixtures, fittings and equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2023
372,907
28,920
3,007,194
196,442
2,942,966
6,548,429
Additions
149,358
166,028
32,208
1,006,370
1,353,964
Disposals
(324,511)
(324,511)
At 31 December 2023
372,907
178,278
3,173,222
228,650
3,624,825
7,577,882
Depreciation and impairment
At 1 January 2023
53,655
922
1,806,364
141,289
1,647,307
3,649,537
Depreciation charged in the year
12,577
1,593
438,495
37,830
463,922
954,417
Eliminated in respect of disposals
(298,482)
(298,482)
At 31 December 2023
66,232
2,515
2,244,859
179,119
1,812,747
4,305,472
Carrying amount
At 31 December 2023
306,675
175,763
928,363
49,531
1,812,078
3,272,410
At 31 December 2022
319,252
27,998
1,200,830
55,153
1,295,659
2,898,892
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
12
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
18
100
100
Movements in fixed asset investments
Shares in group undertakings
£
Cost or valuation
At 1 January 2023 & 31 December 2023
100
Carrying amount
At 31 December 2023
100
At 31 December 2022
100
13
Stocks
2023
2022
£
£
Finished goods and goods for resale
501,321
354,699
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,197,128
2,596,968
Other debtors
21,492
18,185
Prepayments and accrued income
185,736
139,019
2,404,356
2,754,172
15
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
1,172,373
837,706
Corporation tax
233,149
186,165
Other taxation and social security
705,429
622,517
Other creditors
618,301
305,919
Accruals and deferred income
63,675
184,630
2,792,927
2,136,937
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
16
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
619,318
553,394
2023
Movements in the year:
£
Liability at 1 January 2023
553,394
Charge to profit or loss
65,924
Liability at 31 December 2023
619,318
17
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
136,159
126,248
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
18
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Dial-A-Rod.co.uk Limited
England & Wales
Ordinary
100.00
19
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
10,000 Ordinary Shares of £1 each
10,000
10,000
1,000 Ordinary 'B' Shares of 10p each
100
100
10,100
10,100
PUBLIC SEWER SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
20
Events after the reporting date
On 2 February 2024, 100% of the share capital of Public Sewer Services Limited was acquired by Adler and Allan Limited, a company that provides environmental risk reduction through preventative and responsive solutions.
21
Related party transactions
At the year end the company owed the directors £549,566 (2022: £270,356). This amount is included in other creditors, creditors due within 1 year.
22
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
2,091,244
1,002,537
3,093,781
23
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
1,890,947
2,430,271
Adjustments for:
Taxation charged
309,827
348,988
Finance costs
239
Investment income
(28,267)
(2,133)
(Gain)/loss on disposal of tangible fixed assets
(30,319)
78,576
Depreciation and impairment of tangible fixed assets
954,417
828,177
Movements in working capital:
Increase in stocks
(146,622)
(21,462)
Decrease/(increase) in debtors
349,816
(495,517)
Increase in creditors
609,006
391,528
Cash generated from operations
3,908,805
3,558,667
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