Company registration number 11294236 (England and Wales)
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
COMPANY INFORMATION
Directors
Mr J T Stack
Mrs N L Boateng
Ms R Keene
Mr P Linkson
Secretary
Mrs N L Boateng
Company number
11294236
Registered office
Borough Offices
Bishops' College
Churchgate, Cheshunt
Waltham Cross
EN8 9XQ
Auditor
Ensors Accountants LLP
Saxon House
Moseley's Farm Business Centre
Fornham All Saints
Bury St Edmunds
IP28 6JY
Business address
Borough Offices
Bishops' College
Churchgate, Cheshunt
Waltham Cross
EN8 9XQ
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Income statement
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12 - 21
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -

The directors present the strategic report for the year ended 31 March 2024.

Principal activities

The principal activities of the Company are waste and recycling collections, cemetery services, the management of the Borough’s parks and open spaces, including associated grounds maintenance, the management of town centre markets, street cleansing and environmental enforcement. The majority of the Company's activities are performed on behalf of the Council of the Borough of Broxbourne ("the Council") under a seven-year contract which commenced on 1 April 2019. In addition, BEST provides commercial services to local businesses within the Borough, including trade waste collection and grass cutting services.

Review of the business

The Company began trading on 1 April 2019. In its fifth year of trading Broxbourne Environmental Services Trading Ltd (BEST) made a gross profit of £2,082,764 (2023: £2,027,466). After management charges and contract performance penalties were applied by its main customer, the Council, the company made a loss on ordinary activities before taxation of £317,780 (2023: £343,934).

 

The company continued to work closely with the Council’s Customer Services Team during the year to improve the customer experience for the Borough’s residents.

During the year the company improved service performance relating to the Council’s refuse and recycling services.

During the year missed collections reports for the food waste collection service reduced by 20% from 2,294 in 2022/23 to 1,812 in 2023/24, a reduction of 482 reports.

 

Missed collection reports for the refuse collection service reduced by 10% from 2,369 in 2022/23 to 2,126, which represents 243 fewer reports.

 

Missed collection reports for the green waste service reduced by 2% from 1,186 in 2022/23 to 1,160 in 2023/24 (26 fewer missed collection reports).

Missed collection reports relating to the dry recycling service reduced by 1% from 1,720 in 2022/23 to 1,685 in 2023/24 (35 fewer missed collection reports).

 

The Council were pleased with the progress made in improving the performance of these key frontline services. The company will strive to continue to lower the number of missed collection reports across all services in the years ahead.

 

During 2023/24 BEST’s Commercial Waste Team made good progress in increasing trade waste sales and market share. In 2023/24 trade waste income increased by 20% from £882,845 to £1,058,600.

 

At the close of the year total external income represents 14% of turnover.

 

The Directors of the Company are generally pleased with the fifth year’s trading.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
Principal risks and uncertainties

The Company’s activities expose it to a variety of financial risks:

 

 

The Company does not extend credit to its customers, invoices are payable on demand, therefore the Company’s assessment of its potential maximum exposure to credit risk in relation to customer debt is nil.

On behalf of the board

Ms R Keene
Director
23 September 2024
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 March 2024.

Results and dividends

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Mr J T Stack
Mrs N L Boateng
Ms R Keene
Mr P Linkson
Political donations

No political or charitable donations were made during the period and the Company did not acquire any of its own shares nor did it acquire shares in another organisation.

Auditor

Ensors Accountants 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.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of It has done so in respect of the review of the business and principal risks and uncertainties.

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.

Going concern

The Company’s business activities, together with the factors likely to affect its future development, performance and position are set out in the strategic report and directors’ report. The financial position of the Company is set out in these financial statements.

Broxbourne Borough Council is in a strong financial position and will continue to provide financial support to the Company, for a period to 31 March 2025. The Company does not envisage that a material change will be required to any expected credit loss provisions on amounts due from customers based on recent trading updates and related recoverability or other provisions.

 

Therefore, the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -
Risk

The main risks facing the Company are as follows:

 

Risk

Controls

Accident resulting in serious injury or death to a member of staff and/or the public and/or actions taken by the HSE which impact on the services in terms of halting operations or causing operational disruption, financial losses or damage to reputation. E.g. enforcement action, prohibition order or prosecution.

Regular Health and Safety meetings take place to review accident statistics and discuss any follow up actions. Front line staff receive an induction when they commence employment, are issued with PPE and given basic H&S training. BEST Supervisors and Managers monitor PPE compliance and safe working practices. A vehicle and plant maintenance programme is in place to ensure vehicles and plant are kept in good order.  A full suite of Health and Safety policies and risk assessments are in place and are regularly reviewed and updated.

Loss of Operator's Licence preventing vehicle movements, thereby preventing service delivery.

 

The Managing Director of BEST is a CPC holder.  The Transport Manager is responsible for the Operators Licence and is the nominated Transport Manager for BEST's Operators Licence.  Systems are in place to ensure compliance with the licence (e.g. scheduled vehicle inspection/maintenance/licensing and defect reporting). 

Costs/income adversely impacts financial provision as a result of market forces.

Monthly budgetary monitoring and value for money procurement, including joint procurement via consortiums, e.g. Herts Waste Partnership for the sale of recyclable materials.

 

Inefficient or poorly perceived delivery of waste collection, street cleansing, cemetery services, green space management, markets and other services within the department resulting in customer dissatisfaction/increased costs.

 

Effective management of service and regular performance monitoring with corrective actions where required.

 

 

Small companies exemption

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

On behalf of the board
Ms R Keene
Director
23 September 2024
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 5 -

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:

 

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.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
- 6 -
Opinion

We have audited the financial statements of Broxbourne Environmental Services Trading Ltd (the 'company') for the year ended 31 March 2024 which comprise the income statement, the statement of financial position, the statement of changes in equity 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 101 Reduced Disclosure Framework (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 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 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:

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD (CONTINUED)
- 7 -
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 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 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.

 

Our audit was designed to include tests of detail together with an assessment of the control environment to enable us to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement due to fraud. This included work on areas where we consider there is a higher risk of fraud including revenue recognition, management override of systems and control, transactions with related parties, commitments and contingencies and accounting estimates.

 

We also obtained an understanding of the legal and regulatory framework that the company operates in, through discussions with the directors and other management, and from our own knowledge and experience of the sector.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD (CONTINUED)
- 8 -

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

 

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

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.

Use of our report

This report is made solely to the company’s member 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 member, those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.

Barry Gostling (Senior Statutory Auditor)
For and on behalf of Ensors Accountants LLP
22 October 2024
Chartered Accountants
Statutory Auditor
Saxon House
Moseley's Farm Business Centre
Fornham All Saints
Bury St Edmunds
IP28 6JY
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
2024
2023
Notes
£
£
Revenue
2
9,574,857
9,159,969
Cost of sales
(7,492,093)
(7,132,503)
Gross profit
2,082,764
2,027,466
Administrative expenses
(2,340,767)
(2,371,400)
Operating loss
3
(258,003)
(343,934)
Finance costs
6
(59,777)
-
Loss before taxation
(317,780)
(343,934)
Tax on loss
7
-
0
3,947
Loss and total comprehensive income for the financial year
(317,780)
(339,987)
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
STATEMENT OF FINANCIAL POSITION
AS AT
31 MARCH 2024
31 March 2024
- 10 -
2024
2023
Notes
£
£
£
£
Non-current assets
Intangible assets
8
18,573
29,560
Property, plant and equipment
9
958,740
1,316,547
977,313
1,346,107
Current assets
Inventories
10
47,872
46,373
Trade and other receivables
11
67,837
475,259
Cash and cash equivalents
273,394
249,119
389,103
770,751
Current liabilities
12
(2,199,315)
(2,363,584)
Net current liabilities
(1,810,212)
(1,592,833)
Total assets less current liabilities
(832,899)
(246,726)
Non-current liabilities
12
(553,647)
(822,040)
Net liabilities
(1,386,546)
(1,068,766)
Equity
Called up share capital
16
1
1
Retained earnings
(1,386,547)
(1,068,767)
Total equity
(1,386,546)
(1,068,766)

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

The financial statements were approved by the board of directors and authorised for issue on 23 September 2024 and are signed on its behalf by:
Ms R  Keene
Director
Company registration number 11294236 (England and Wales)
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
Share capital
Retained earnings
Total
£
£
£
Balance at 1 April 2022
1
(728,780)
(728,779)
Year ended 31 March 2023:
Loss and total comprehensive income
-
(339,987)
(339,987)
Balance at 31 March 2023
1
(1,068,767)
(1,068,766)
Year ended 31 March 2024:
Loss and total comprehensive income
-
(317,780)
(317,780)
Balance at 31 March 2024
1
(1,386,547)
(1,386,546)
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
1
Accounting policies
Company information

Broxbourne Environmental Services Trading Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Borough Offices, Bishops' College, Churchgate, Cheshunt, Waltham Cross, EN8 9XJ. The company's principal activities and nature of its operations are disclosed in the directors' report.

1.1
Accounting convention

The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.

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, except for the revaluation of . The principal accounting policies adopted are set out below.

As permitted by FRS 101, the company has taken advantage of the following disclosure exemptions from the requirements of IFRS:

Where required, equivalent disclosures are given in the ultimate parent group accounts of Broxbourne of Borough Council. The group accounts of Broxbourne of Borough Council are available to the public and can be found at the following location https://www.broxbourne.gov.uk/finance

1.2
Going concern

The directors have at the time of approving the financial statements, a reasonable expectation that the truecompany 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.

 

The directors have considered the factors that impact the company’s future financial performance, cash flows and financial position, along with the company’s current liquidity in forming their conclusion on the applicability of the going concern basis.

 

As the company's current liabilities exceed its current assets the company is reliant upon the support of its parent undertaking.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -
1.3
Revenue

Revenue arise from the provision of goods and services provided in line with the principle activities set out in the Strategic report and excludes value added tax.

 

In the case of the annual contract charge, which is a fixed price contract governed by KPIs, the customer pays the fixed amount based on a payment schedule, normally paid in the same month as the service is rendered.

 

The company recognises revenue from the following major sources. The nature, timing of satisfaction of performance obligations and significant payment terms of the company's major sources of revenue are as follows:

Contract income

Contract income represents the provision of services to the Borough of Broxbourne Council. Revenue from contract income is in accordance with the agreement between the Company and the Council, whereby the Council pays a fixed monthly charge. Revenue is recognised in the month in which the contract services are performed.

Income from the provision of other services

Income from the provision of other services represents income from services provided to customers. Revenue from this income is recognised when the service has been performed, when the performance obligation has been satisfied and when the amount of revenue can be measured reliably.

1.4
Intangible assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

 

Amortisation 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. The useful life assigned to the accounting software suite used by the Company is five years.

1.5
Impairment of tangible and intangible assets

At each reporting end date, the company 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).

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever there is an indication that the asset may be impaired.

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.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
1.6
Inventories

Inventories are stated at the lower of cost and estimated selling price less costs to complete and sell.

Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.

1.7
Cash and cash equivalents

Cash and cash equivalents 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.

1.8
Financial assets

Financial assets are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

Financial assets held at amortised cost

Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.

Impairment of financial assets

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

 

The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

 

For trade receivables, the simplified approach permitted by IFRS 9 is applied, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

1.9
Financial liabilities

The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.

Other financial liabilities

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.

1.10
Equity instruments

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

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 income statement 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.

Deferred tax

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary 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 income statement, 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
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 inventories or non-current 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.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 16 -
1.13
Retirement benefits

The company participates in two retirement benefit scheme arrangements.

 

The company offers a defined contribution plan for all eligible employees. The funds for this plan are managed independently from the company’s asserts in a separately administered scheme. Payments to the defined contribution retirement benefit scheme are charged as an expense as they fall due.

 

The company also participates in the Local Government Pension Scheme which is a multi-employer defined benefit scheme for employees who transferred into the company under TUPE arrangements. The company benefits from a contractual agreement with its parent undertaking that caps the maximum contribution rate payable to the scheme as well as indemnifying the company from any actuarial deficits within the scheme. As a result the company accounts for their participation within the Local Government Pension Scheme as if it were a defined contribution scheme.

1.14
Leases

At inception, the company assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the company recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.

 

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the company's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the company is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the company's estimate of the amount expected to be payable under a residual value guarantee; or the company's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 17 -
2
Revenue
2024
2023
£
£
Revenue analysed by class of business
Contract income
8,203,586
7,883,492
Income from the provision of other services
1,371,271
1,276,477
9,574,857
9,159,969
3
Operating loss
2024
2023
Operating loss for the year is stated after charging/(crediting):
£
£
Depreciation of property, plant and equipment
610,118
599,033
Amortisation of intangible assets (included within administrative expenses)
10,987
10,987
Cost of inventories recognised as an expense
173,859
179,785
4
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
18,150
23,300
5
Employees

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

2024
2023
Number
Number
Provision of services
138
139
Admin and support
1
1
Total
139
140

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
3,811,164
3,515,749
Social security costs
344,763
318,851
Pension costs
331,785
336,366
Temporary staff
370,049
311,150
Other staff costs
47,397
106,752
4,905,158
4,588,868
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 18 -
6
Finance costs
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on other loans
59,777
-
0
7
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
-
(3,947)

As of 1 April 2023, in accordance with the Finance Act 2021, the corporate tax rate increased to 25% for companies with profits exceeding £250,000. A small profits rate of 19% applies to companies with profits of £50,000 or less, and a graduated rate applies to companies with profits between £50,000 and £250,000.

The charge for the year can be reconciled to the loss per the income statement as follows:

2024
2023
£
£
Loss before taxation
(317,780)
(343,934)
Expected tax credit based on a corporation tax rate of 25.00% (2023: 19.00%)
(79,445)
(65,347)
Effect of expenses not deductible in determining taxable profit
213
71
Group relief
-
0
3,947
Adjustments in respect of financial assets
-
(3,549)
Remeasurement of deferred tax for changes in tax rates
-
(20,487)
Deferred tax not recognised
79,232
85,365
Receipt for group relief surrendered
-
(3,947)
Taxation charge/(credit) for the year
-
(3,947)

As of 31 March 31 2024, the company possesses unutilised trading losses amounting to £1.22 million. These losses can be applied against profits in any subsequent fiscal period. Nonetheless, due to the absence of anticipated profits, the deferred tax asset associated with these losses has not been recognised in the financial statements.

BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 19 -
8
Intangible fixed assets
Software
£
Cost
At 31 March 2023
54,934
At 31 March 2024
54,934
Amortisation and impairment
At 31 March 2023
25,374
Charge for the year
10,987
At 31 March 2024
36,361
Carrying amount
At 31 March 2024
18,573
At 31 March 2023
29,560
9
Property, plant and equipment
Property
Plant and equipment
Total
£
£
£
Cost
At 1 April 2023
715,938
3,572,350
4,288,288
Additions
-
0
252,311
252,311
At 31 March 2024
715,938
3,824,661
4,540,599
Accumulated depreciation and impairment
At 1 April 2023
570,800
2,400,941
2,971,741
Charge for the year
145,138
464,980
610,118
At 31 March 2024
715,938
2,865,921
3,581,859
Carrying amount
At 31 March 2024
-
0
958,740
958,740
At 31 March 2023
145,138
1,171,409
1,316,547

Property, plant and equipment is comprised of right-of-use assets held under finance leases.

10
Inventories
2024
2023
£
£
Finished goods
47,872
46,373
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 20 -
11
Trade and other receivables
2024
2023
£
£
Trade receivables
85,744
66,567
Provision for bad and doubtful debts
(17,907)
(23,153)
67,837
43,414
Amounts owed by fellow group undertakings
-
0
431,845
67,837
475,259
12
Liabilities
Current
Non-current
2024
2023
2024
2023
Notes
£
£
£
£
Trade and other payables
13
1,380,358
1,501,219
-
0
-
0
Taxation and social security
342,835
281,075
-
-
Lease liabilities
14
476,122
581,290
553,647
822,040
2,199,315
2,363,584
553,647
822,040
13
Trade and other payables
2024
2023
£
£
Trade payables
-
0
34,989
Amounts owed to fellow group undertakings
1,109,313
1,185,577
Accruals and deferred income
271,045
280,653
1,380,358
1,501,219
14
Lease liabilities
2024
2023
Maturity analysis
£
£
Within one year
514,740
633,968
In two to five years
577,910
868,075
Total undiscounted liabilities
1,092,650
1,502,043
Future finance charges and other adjustments
(62,881)
(98,713)
Lease liabilities in the financial statements
1,029,769
1,403,330
BROXBOURNE ENVIRONMENTAL SERVICES TRADING LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
14
Lease liabilities
(Continued)
- 21 -

Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:

2024
2023
£
£
Current liabilities
476,122
581,290
Non-current liabilities
553,647
822,040
1,029,769
1,403,330
15
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
331,785
336,366

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.

16
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
of £1 each
1
1
1
1
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