Company registration number 04507615 (England and Wales)
GEMCHEM LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
GEMCHEM LIMITED
COMPANY INFORMATION
Directors
J Zhang
W M Crossland
D Green
Secretary
J Zhang
Company number
04507615
Registered office
Unit 5
Unicorn Business Park
Whitby Road
Bristol
BS4 4EX
Auditor
Prydis Accounts Limited
The Parade
Liskeard
Cornwall
PL14 6AF
GEMCHEM LIMITED
CONTENTS
Page
Directors' report
1
Independent auditor's report
3 - 5
Profit and loss account
6
Balance sheet
7
Statement of changes in equity
8
Notes to the financial statements
9 - 14
GEMCHEM LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2024
- 1 -

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

Principal activities

The principal activity of the is the supply of water treatment products and services.

Directors

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

J Zhang
W M Crossland
D Green
Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Statement of disclosure to auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they ought know of and of which they know the auditors are unaware.

Small companies provision statement

In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

 

On behalf of the board
D Green
Director
23 October 2024
GEMCHEM LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MAY 2024
- 2 -

The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulation.

 

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.

GEMCHEM LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GEMCHEM LIMITED
- 3 -
Opinion

We have audited the financial statements of GEMchem Limited (the 'company') for the year ended 31 May 2024 which comprise the profit and loss account, the balance sheet, 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 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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:

GEMCHEM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GEMCHEM LIMITED
- 4 -
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.

We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur.

The laws and regulations the auditor identified as being of significance in the context of the entity include the Companies Act 2006, Employment Act 2008, Health and Safety at Work Act 1974 and compliance with ISO 9001.

- Enquiry of management and 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 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.

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.

GEMCHEM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GEMCHEM LIMITED
- 5 -

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Gary Randall (Senior Statutory Auditor)
For and on behalf of Prydis Accounts Limited
24 October 2024
Chartered Accountants
Statutory Auditor
The Parade
Liskeard
Cornwall
PL14 6AF
GEMCHEM LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MAY 2024
- 6 -
2024
2023
Notes
£
£
Turnover
740,385
699,712
Cost of sales
(185,166)
(199,931)
Gross profit
555,219
499,781
Administrative expenses
(433,263)
(483,334)
Operating profit
5
121,956
16,447
Interest receivable and similar income
1,397
476
Profit before taxation
123,353
16,923
Tax on profit
(31,867)
(4,447)
Profit for the financial year
91,486
12,476

The profit and loss account has been prepared on the basis that all operations are continuing operations.

GEMCHEM LIMITED
BALANCE SHEET
AS AT
31 MAY 2024
31 May 2024
- 7 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
6
1,690
2,465
Current assets
Stocks
7
26,810
24,232
Debtors
8
93,393
133,373
Cash at bank and in hand
287,091
212,529
407,294
370,134
Creditors: amounts falling due within one year
9
(157,579)
(122,635)
Net current assets
249,715
247,499
Total assets less current liabilities
251,405
249,964
Provisions for liabilities
(423)
(468)
Net assets
250,982
249,496
Capital and reserves
Called up share capital
10
5,000
5,000
Profit and loss reserves
245,982
244,496
Total equity
250,982
249,496

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 October 2024 and are signed on its behalf by:
D Green
Director
Company Registration No. 04507615
GEMCHEM LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2024
- 8 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 June 2022
5,000
277,020
282,020
Year ended 31 May 2023:
Profit and total comprehensive income for the year
-
12,476
12,476
Dividends
-
(45,000)
(45,000)
Balance at 31 May 2023
5,000
244,496
249,496
Year ended 31 May 2024:
Profit and total comprehensive income for the year
-
91,486
91,486
Dividends
-
(90,000)
(90,000)
Balance at 31 May 2024
5,000
245,982
250,982

The notes on pages 9 to 14 form part of these financial statements.

GEMCHEM LIMITED
STATEMENT OF CHANGES IN EQUITY (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 9 -
1
Judgements and key sources of estimation uncertainty

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2
Accounting policies
Company information

GEMchem Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 5, Unicorn Business Park, Whitby Road, Bristol, BS4 4EX.

2.1
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 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.

In these financial statements, the Company has applied exemptions available under FRS 102 in respect of the following disclosures:

 

 

As the consolidated financial statements of Thermal Energy International Inc include the equivalent disclosures, the Company has also taken the exemptions under FRS 102 available in respect of the following disclosures:

 

2.2
Going concern

On the basis of the Company's financial position and future forecasts and the enquiries made of the directors of the Company's parent company, Thermal Energy International (UK) Limited, the Company's directors have a reasonable expectation that the Company will be able to continue in operational existence for the foreseeable future. Furthermore, the directors have received an undertaking from the ultimate controlling parent company to continue to provide financial assistance, as required, for a period of at least 12 months from the date of these financial statements to enable the Company to meet its obligations as they fall due. Thus, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

2.3
Revenue recognition

Turnover comprises revenue recognised by the Company in respect of goods and service supplied during the year, exclusive of Value Added Tax and trade discounts. Turnover is recognised straight line over the period the Company is contracted to provide its services. All turnover arose in the United Kingdom and relates solely to the Company's principal activity.

GEMCHEM LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2
Accounting policies
(Continued)
- 10 -
2.4
Finance income and costs policy

Interest payable and similar charges include interest payable and net foreign currency exchange losses that are recognised in the profit and loss account (see foreign currency accounting policy).

 

Other interest receivable and similar income include interest receivable on funds invested and net foreign exchange gains that are recognised in the profit and loss account (see foreign currency accounting policy).

 

Interest income and interest payable are recognised in the profit and loss as they accrue, using the effective interest method. Foreign currency gains and losses are reported on a net basis.

2.5
Foreign currency transactions and balances

The Company's functional and presentation currency is the pound sterling. Transactions in foreign currencies are translated to the Company's functional currency at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denoted in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction, Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair value was determined. Foreign exchange differences arising on translation are recognised in the profit and loss account.

2.6
Taxation

Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss account except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised directly in equity or other comprehensive income

Current tax

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.

Deferred tax

Deferred tax is provided on timing difference which arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements. the following timing differences are not provided for: differences between accumulated depreciation and tax allowances for the cost of a fixed asset if and when all conditions for retaining the tax allowances have been met. Deferred tax is not recognised on permanent differences arising because certain types of income or expense are non-taxable or are disallowable for tax or because certain tax charges or allowances are greater or smaller than the corresponding income of expense.

Deferred tax is measured at the tax rate that is expected to apply to the reversal of the related difference, using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax balances are not discounted.

Unrelieved losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

2.7
Tangible fixed assets

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Where parts of an item of tangible fixed assets have different useful economic lives, they are accounted for as separate items of tangible fixed assets.

GEMCHEM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
2
Accounting policies
(Continued)
- 11 -

Depreciation is charged to the profit and loss account on a straight line basis over the estimated useful lives of each part of an item of tangible fixed assets,

 

Depreciation methods, useful economic lives and residual values are reviewed if there is an indication of a significant change since last annual reporting date in the pattern by which the company expects to consume an asset's future economic benefits.

 

The estimated useful economic lives are as follows:

Plant and equipment
Straight line method over 5 years
Fixtures and fittings
Straight line method over 3 years
2.8
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).

2.9
Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

2.10

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

 

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

2.11
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the first-in, first-out principle and includes expenditure incurred in acquiring 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.

2.12

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer the settlement of the creditor for at east twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months, they are presented as non-current liabilities.

 

Trade creditors are recognised initially at the transaction price and subsequently ,measured at amortised cost using the effective interest method,

GEMCHEM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
2
Accounting policies
(Continued)
- 12 -
2.13
Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

 

2.14

Dividends

Dividend distributions to the Company;s shareholders are recognised as a liability in the period in which dividends are approved.

2.15
Employee benefits

Short-term benefits, including holiday pay, are recognised as an expense in the period in which the service is received.

2.16
Retirement benefits

A defined contribution plan is a post employment benefit plan under which the company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an expense in the profit and loss account in the periods during which the services are rendered by employees.

3
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
6,000
-
0
4
Employees

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

2024
2023
Number
Number
Total
5
6
5
Operating profit

Profit before tax is arrived at after charging depreciation of £776 (2023: £856).

GEMCHEM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 13 -
6
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Total
£
£
£
Cost
At 1 June 2023
6,798
8,609
15,407
Disposals
(4,503)
(4,597)
(9,100)
At 31 May 2024
2,295
4,012
6,307
Depreciation and impairment
At 1 June 2023
5,186
7,756
12,942
Depreciation charged in the year
467
308
775
Eliminated in respect of disposals
(4,503)
(4,597)
(9,100)
At 31 May 2024
1,150
3,467
4,617
Carrying amount
At 31 May 2024
1,145
545
1,690
At 31 May 2023
1,612
853
2,465
7
Stocks
2024
2023
£
£
Raw materials and consumables
26,810
24,232

£188,000 of raw material was recognised in cost of sales in the year (2023: £106,000).

8
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
89,123
126,435
Other debtors
204
3,259
Prepayments
4,066
3,679
93,393
133,373
GEMCHEM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 14 -
9
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
43,156
43,064
Taxation and social security
70,430
34,447
Other creditors
43,993
45,124
157,579
122,635
10
Called up share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Oridnary shares of £5 each
1,000
1,000
5,000
5,000
11
Parent and ultimate parent undertaking

The company's immediate parent is Thermal Energy International (UK) Limited, incorporated in the United Kingdom.

The ultimate parent is Thermal Energy International Inc, incorporated in Canada.

 

The most senior parent entity producing publicly available financial statements is Thermal Energy International inc. These financial statements are available upon request from 36 Antares Drive, 2nd Fllor, Suite 850, Ottawa, ON K2E 7W5.

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