Company registration number 05757219 (England and Wales)
KINECTRICS UK LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
PAGES FOR FILING WITH REGISTRAR
KINECTRICS UK LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 10
KINECTRICS UK LIMITED
BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
page 1
2024
2023
Notes
£
£
£
£
Fixed assets
Intangible assets
4
4,471
7,923
Tangible assets
5
425,828
472,404
Investments
6
3,487,135
-
0
3,917,434
480,327
Current assets
Debtors
8
2,256,967
1,092,314
Cash at bank and in hand
687,462
1,710,360
2,944,429
2,802,674
Creditors: amounts falling due within one year
9
(7,824,082)
(4,758,857)
Net current liabilities
(4,879,653)
(1,956,183)
Total assets less current liabilities
(962,219)
(1,475,856)
Creditors: amounts falling due after more than one year
10
(925,871)
-
0
Net liabilities
(1,888,090)
(1,475,856)
Capital and reserves
Called up share capital
110
110
Share premium account
10,751
10,751
Contribution reserve
960,256
960,256
Profit and loss reserves
(2,859,207)
(2,446,973)
Total equity
(1,888,090)
(1,475,856)

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

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

The financial statements were approved by the board of directors and authorised for issue on 12 November 2024 and are signed on its behalf by:
K Marner
Director
Company registration number 05757219 (England and Wales)
KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
page 2
1
Accounting policies
Company information

Kinectrics UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is 2 Edward Court, George Richards Way, Altrincham, Cheshire, WA14 5GL.

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 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:

1.2
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.

 

Kinectrics International Inc have signed a letter of support confirming that it will continue to support the company for 12 months following the date of approval of these financial statements.

1.3
Turnover

Turnover represents amounts receivable for research and development of new materials, measurement devices, consultancy and software developments for the power energy, materials and waste resource management industries and the offshore marine sector, net of VAT.

 

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.4
Intangible fixed assets other than goodwill

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

 

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

The estimated useful lives range as follows:

Patents & licences
6.66% straight line
1.5
Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
page 3

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives.

 

Depreciation is provided on the following basis:

Leasehold improvements
50% straight line
Computer Equipment
25% straight line
Motor vehicles
20% reducing balance
Labatory Equipment
15% reducing balance

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted retrospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

 

Gains and losses on disposals are determined by comparing the proceeds, with the carrying amount and are recognised in profit or loss.

1.6
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.

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.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.7
Cash and cash equivalents

Cash consists of cash in hand and deposits. There are no cash equivalents.

1.8
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.

KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
page 4
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 and loans from fellow group companies 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.

1.9
Taxation

Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

 

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.

1.10
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.

1.11
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.12
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
page 5
1.13
Foreign exchange

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

 

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the dates of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

 

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

 

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

1.14

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument,

1.15

Research and development costs

Research and development 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.

1.16

Share capital

The ordinary share capital of the company is presented as equity.

KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
page 6
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.

 

The following judgements and estimates have been made in the process of applying the company's accounting policies and have the most significant effect on the amounts recognised in the financial statements:

 

Revenue recognition

The company recognises revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

 

Bad debt provision

Trade debtors which are aged older than 90 days at the reporting date are treated as fully irrecoverable, and therefore a provision is made. The provision is adjusted in the event of receipt from a debtor which had previously been written off

 

Accrued project losses

Estimations are made of project losses which are accrued during the year.

3
Employees

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

2024
2023
Number
Number
Total
23
22
4
Intangible fixed assets
Patents
£
Cost
At 1 April 2023 and 31 March 2024
34,029
Amortisation and impairment
At 1 April 2023
26,106
Amortisation charged for the year
3,452
At 31 March 2024
29,558
Carrying amount
At 31 March 2024
4,471
At 31 March 2023
7,923
KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
page 7
5
Tangible fixed assets
Leasehold improvements
Laboratory equipment
Computer Equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2023
18,780
884,889
141,432
55,001
1,100,102
Additions
1,000
11,413
6,687
62,096
81,196
At 31 March 2024
19,780
896,302
148,119
117,097
1,181,298
Depreciation and impairment
At 1 April 2023
14,617
500,383
109,948
2,750
627,698
Depreciation charged in the year
4,292
85,085
29,580
8,815
127,772
At 31 March 2024
18,909
585,468
139,528
11,565
755,470
Carrying amount
At 31 March 2024
871
310,834
8,591
105,532
425,828
At 31 March 2023
4,163
384,506
31,484
52,251
472,404
6
Fixed asset investments
2024
2023
£
£
Shares in group undertakings and participating interests
3,487,135
-
0
Movements in fixed asset investments
Shares in subsidiaries
£
Cost or valuation
At 1 April 2023
-
Additions
3,487,135
At 31 March 2024
3,487,135
Carrying amount
At 31 March 2024
3,487,135
At 31 March 2023
-

 

 

 

 

 

KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
page 8
7
Subsidiaries

Details of the company's subsidiaries at 31 March 2024 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Engineering Analysis Services Limited
2 Edward Court, George Richards Way, Altrincham, Cheshire, WA14 5GL
Ordinary A and B shares
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Engineering Analysis Services Limited
2,155,633
367,129
8
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,058,186
405,092
Corporation tax recoverable
57,000
57,000
Amounts owed by group undertakings
760,145
431,371
Other debtors
33,374
-
0
Prepayments and accrued income
348,262
198,851
2,256,967
1,092,314
9
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
27,835
41,409
Amounts owed to group undertakings
6,801,667
4,380,981
Taxation and social security
53,759
74,676
Other creditors
940,821
261,791
7,824,082
4,758,857

Other creditors falling within one year include £613,125 due to the shareholders of Engineering Analysis Services Limited. This is the current portion of deferred consideration.

10
Creditors: amounts falling due after more than one year
2024
2023
£
£
Other creditors
925,871
-
0
KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
10
Creditors: amounts falling due after more than one year
(Continued)
page 9

Other creditors falling due after more than one year include £925,871 due to the shareholders of Engineering Analysis Services Limited. This is the non-current portion of deferred consideration.

 

11
Reserves

The company's capital and reserves are as follows:

 

Called up share capital

 

Called up share capital represents the nominal value of the shares issues.

 

Share premium account

 

The share premium account includes the premium on issue of equity shares, net of any issue costs.

 

Contribution reserve

 

On 19 November 2020, the company's sole shareholder, Kinectrics International Inc ("KII") has offered the company a contribution amount of £960,265, where KII has converted the loan the company owed to KII and it's parent, Kinectrics Inc ("KI"), amounting £181,935 and £778,330 respectively. Subsequently, KII and KI have released the company from the loan repayment obligation.

 

Profit and loss account

 

The profit and loss account represents cumulative profits or losses and other adjustments.

12
Pension commitments

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. The pension cost charge represents contributions payable by the company to the fund and amount to £82,216 (2023 - £77,719).

13
Controlling party

The smallest group in which the financial statements of the company are consolidated is Kinectrics Inc, a company registered in Canada. The registered address is 800 Kipling Avenue, Toronto, Ontario, ON M8Z 5G5, Canada.

 

The ultimate controlling party is D R Harris.

14
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 auditor's report was unqualified.

Senior Statutory Auditor:
Darren Harding ACA FCCA DChA
For and on behalf of Richard Place Dobson Services Limited Chartered Accountants
KINECTRICS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
page 10
15
Operating lease commitments

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

2024
2023
£
£
95,266
222,914
16
Related party transactions

The company has taken advantage of the exemption under Financial Reporting Standard 102 paragraph 33.1A not to disclose transactions with other group companies.

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