Company registration number 02286559 (England and Wales)
SIGNAL HOUSE LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
PAGES FOR FILING WITH REGISTRAR
SIGNAL HOUSE LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 10
SIGNAL HOUSE LIMITED
BALANCE SHEET
AS AT
31 OCTOBER 2023
31 October 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
4
92,466
112,362
Current assets
Stocks
5
276,531
301,868
Debtors
6
174,824
356,658
Cash at bank and in hand
1,738
4,370
453,093
662,896
Creditors: amounts falling due within one year
7
(502,567)
(668,340)
Net current liabilities
(49,474)
(5,444)
Total assets less current liabilities
42,992
106,918
Provisions for liabilities
(21,350)
(25,837)
Net assets
21,642
81,081
Capital and reserves
Called up share capital
9
52,630
52,630
Profit and loss reserves
(30,988)
28,451
Total equity
21,642
81,081
SIGNAL HOUSE LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 OCTOBER 2023
31 October 2023
- 2 -
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered 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 31 October 2024 and are signed on its behalf by:
P Hobbs
J A Leafe
Director
Director
P Roberts
Director
Company registration number 02286559 (England and Wales)
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 3 -
1
Accounting policies
Company information
Signal House Limited is a private company limited by shares incorporated in England and Wales. The registered office is Salcombe Road, Meadow Lane Industrial Estate, Alfreton, Derbyshire, DE55 7RG.
The principal place of business is:
Cherrycourt Way
Stanbridge Road
Leighton Buzzard
Bedfordshire
LU7 4UH
1.1
Reporting period
The prior year financial statements cover an 18 month period from 1 May 2021 to 31 October 2022 and as such the comparatives are not entirely comparable. The accounting reference date was changed for commercial reasons,
1.2
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The 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. The principal accounting policies adopted are set out below.
1.3
Going concern
During the year the company has reported a loss of £59,439 and since the year-end there has been a significant drop in activity which is being faced by all in the rail industry.
The downturn is caused by the change in control period by Network Rail which, whilst the changeover is in progress, has significantly disrupted the trade within rail, being the industry in which the group primarily operates in. The group has overseen the changeover of control periods previously and the directors therefore feel the group is in a good position to navigate the slump in demand and also has orders within other industries to be able to focus on. It is the hope and expectation that the downturn will be a short term issue and orders will start to increase and return to normal levels in the new year.
This downturn in trade has of course had an impact on cash flow management and projections for the company and also the wider group to which it belongs. The directors are having to closely monitor that it stays within its agreed facilities. To help mitigate the cash flow shortfall the group has taken on some further bank borrowings to help ease the pressure. Further steps are also being taken and reviewed to reduce expenditure through periods of low orders.
At the time of approving the financial statements, the directors therefore have a reasonable expectation that the company and group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements
The validity of this assumption for the company is also dependent on the continued support, which has been received in writing, of its parent company and also other members of the group and not requiring the withdrawal of monies owed until sufficient funds are available.
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 4 -
1.4
Turnover
Turnover represents the total invoice value, excluding value added tax, of sales made during the year. Income is recognised based on the date goods are despatched and the level of completion of services.
1.5
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.6
Tangible fixed assets
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:
Plant and machinery
20% reducing balance
Fixtures and fittings
15% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.7
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.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. The cost of finished goods and work in progress 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.
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.
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 5 -
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.
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.
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.
1.10
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.
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 6 -
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.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.14
Government grants
Government grants are recognised in the profit and loss account as income when such grant does not impose specified future performance-related conditions, in accordance with the performance model.
2
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.
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 7 -
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.
Impairment of debtors
On a periodic basis management makes an estimation of the recoverability of debtors. Management make such estimations based on the ageing profile, and historical experience.
Impairment of stock
The company’s products are subject to changing market demand. It is therefore necessary to consider on a periodic basis the recoverability of the cost of stocks and the associated impairment. Management calculates impairments by considering the nature and condition of the stocks and applies assumptions around anticipated salability of finished goods and future usage of raw materials, overheads and labour.
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
15
16
4
Tangible fixed assets
Plant and machinery
Fixtures and fittings
Total
£
£
£
Cost
At 1 November 2022
479,397
152,064
631,461
Additions
1,569
1,569
Disposals
(750)
(750)
At 31 October 2023
480,966
151,314
632,280
Depreciation and impairment
At 1 November 2022
397,758
121,341
519,099
Depreciation charged in the year
16,198
4,517
20,715
At 31 October 2023
413,956
125,858
539,814
Carrying amount
At 31 October 2023
67,010
25,456
92,466
At 31 October 2022
81,639
30,723
112,362
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 8 -
5
Stocks
2023
2022
£
£
Other inventories
240,292
251,174
Work in progress
36,239
50,694
276,531
301,868
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
141,883
112,950
Amounts owed by group undertakings
221,277
Other debtors
32,941
22,431
174,824
356,658
7
Creditors: amounts falling due within one year
2023
2022
£
£
Loans and borrowings
8
103,076
101,028
Trade creditors
41,872
41,715
Amounts owed to group undertakings
316,494
473,293
Taxation and social security
25,562
30,348
Other creditors
15,563
21,956
502,567
668,340
8
Loans and borrowings
2023
2022
£
£
Bank overdrafts
19,943
8,296
Other loans
83,133
92,732
103,076
101,028
Payable within one year
103,076
101,028
Payable after one year
-
-
The bank borrowings are denominated in Sterling. The carrying amount at the year end is £19,834 (2022 - £8,296). The bank borrowings are secured by virtue of a debenture over all of the company's assets.
Other borrowings, which relate to invoice discount facilities, are secured against the related debtors and also by virtue of cross guarantees between group companies. The carrying amount at the year end is £83,133 (2022 - £92,732).
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 9 -
9
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
52,630
52,630
52,630
52,630
10
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The Independent Auditors' Report was unqualified.
Material uncertainty relating to going concern
We draw attention to Note 1.3 in the financial statements and also the fact losses of incurred have been incurred £59,439 in the year, as reflected in the Statement of income and retained earnings. As pointed out in Note 1.3, since the year end the company's trading activity has been further affected by the reduction in work within the rail sector. This has had a resulting impact on the cashflow position in the company and also across the wider group to which the company belongs. This has required increased borrowings in the group to assist in managing this and working capital requirements. As further stated in Note 1.3, it is the belief of the directors that this downturn in the rail sector will be short term and the company is looking to increase orders outside this sector. However, whilst these events and conditions are present it indicates that an uncertainty may exists and cast doubt on the company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
Senior Statutory Auditor:
Gavin Robert Booth
Statutory Auditor:
DJH Audit Limited
Date of audit report:
31 October 2024
11
Contingent liabilites
The company has entered into cross guarantees with its finance providers in respect of the liabilities of other group and related companies. This is supported by a debenture over the company's assets. The contingent liability as at 31 October 2023 is £2,230,917 (2022 - £2,539,588). The future outcome is dependant upon the performance of individual companies concerned, however the director's do not expect any liability to crystalise.
12
Financial commitments, guarantees and contingent liabilities
The total amount of financial commitments not included in the balance sheet is £4,505 (2022 - £5,627).
13
Related party transactions
The company has taken advantage of the exemption available under FRS 102 Section 1A in respect of disclosing transactions with other members of the group.
14
Parent company
The company's immediate parent is Signal House Group Limited, incorporated in England.
The ultimate controlling party is P Roberts.
SIGNAL HOUSE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
14
Parent company
(Continued)
- 10 -
The parent of the smallest and largest group in which these financial statements are
consolidated is Signal House Group Limited, incorporated in England.
The address of Signal House Group Limited is:
Salcombe Road, Meadow Lane Industrial Estate, Alfreton, Derbyshite, DE55 7RG.
These financial statements are available on request from Companies house, Crown Way, Maindy, Cardiff, CF14 3UZ