Company registration number 09692990 (England and Wales)
SECRETARIAT INTERNATIONAL UK LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
SECRETARIAT INTERNATIONAL UK LTD
COMPANY INFORMATION
Directors
Mr D Harvey
Mr J Little
Company number
09692990
Registered office
22 Bishopsgate
22nd Floor
London
England
EC2N 4BQ
Auditor
Kirk Rice LLP
Zeeta House
200 Upper Richmond Road
Putney
London
SW15 2SH
SECRETARIAT INTERNATIONAL UK LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 23
SECRETARIAT INTERNATIONAL UK LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
The principal activity of the Company is the provision of expert and consultancy services. The Company is an independent, award-winning, global expert services firm utilizing deep industry knowledge and technical expertise.
We are agnostic to our client industries, serving corporations, legal counsel and governments across the globe in most verticals. We strategically focus on industries and clients that are operating within highly regulated environments, those facing transformational change and or significant legal issues. Our expert services include dispute resolution, financial and strategic valuations, technology, investigations and compliance. These services are provided worldwide.
The reputation and expertise of our company and our US parent (Secretariat Inc.) provides us with a backbone for growth, our international experience, the experts and staff we employ are of the highest calibre and are known throughout the industry. This reputation and expertise allows us to compete effectively in our chosen markets.
During the year, most new engagements were opened in our sister entity, Secretariat Partners UK LLP (Co. No. OC425833). All recruitment of new staff has been transferred to the sister entity and all employees were transferred to Secretariat Partners UK LLP in the first half of 2024.
In the year, revenues increased to £18.7M, an increase of 38% compared to the prior year of £13.5M. We expect a decline in future years as new contracts are solely established through our sister company.
The Company had gross margin percentage of 14%, down from 31% in the prior year, impacted by the transition of contracts to the sister company. EBITDA in the year was £423k vs. -£36k in the prior year.
Net cashflow increased in the period to £852k (2022: -£87k).
Principal risks and uncertainties
Loss of Key Experts
All staff are incentivized appropriately to maintain excellent standards of performance. We ensure that this performance level is recognized and key staff retained through our internal programs.
Foreign Exchange Risk
The Company operates in many jurisdictions. Wherever possible, the Company attempts to purchase and invoice in GBP in order to remove currency risk. Where this is not possible, the company ensures that the risk is managed and assessed on an ongoing basis. The Company does not hedge or use financial derivatives to manage currency exposures.
Development and performance
In the coming year, we will continue to focus our attention on developing our offering further, utilizing the experience and assets of our US parent to develop new markets geographically, and ensure that the Company’s brand and ethos is recognised to further enhance our highly valued reputation.
Key performance indicators
SECRETARIAT INTERNATIONAL UK LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Mr J Little
Director
13 November 2024
SECRETARIAT INTERNATIONAL UK LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company includes expert advisory services involving international arbitration, litigation, and large-scale construction disputes with a focus on delay and quantum analysis.
Results and dividends
The results for the year are set out on page 8.
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 D Harvey
Mr J Little
Auditor
In accordance with the company's articles, a resolution proposing that Kirk Rice LLP be reappointed as auditor of the company 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 likely future developments in the business of the company.
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
At 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.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
Mr J Little
Director
13 November 2024
SECRETARIAT INTERNATIONAL UK LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
SECRETARIAT INTERNATIONAL UK LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF SECRETARIAT INTERNATIONAL UK LTD
- 5 -
Opinion
We have audited the financial statements of Secretariat International UK Ltd (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
SECRETARIAT INTERNATIONAL UK LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF SECRETARIAT INTERNATIONAL UK LTD
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Extent to which the audit was considered capable of detecting irregularities, including fraud
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 misstatement in respect of irregularities, including fraud.
Based on our understanding of the company and its environment, we identified the principal risks of non-compliance with laws and regulations related to the Companies Act 2006, and we considered the extent of which non-compliance might have a material effect on the financial statements. We also considered the direct impact of these laws and regulations on the financial statements. We evaluated incentives and opportunities for fraudulent manipulation of the financial statements including the risk of override of controls, by the directors, management and those responsible for, or involved in, the preparation of the underlying accounting records and financial statements, and determined that the principle risks were related to the posting of inappropriate journals to manipulate financial results or conceal the misappropriation of assets and potential management bias in accounting estimates. Audit procedures performed included:
Testing journal entries where we identified particular fraud risk criteria;
Reviewing meeting minutes, contracts and agreements;
Holding discussions with management and the board of directors to identify significant or unusual transactions and known or suspected instances of fraud or non-compliance with laws and regulations;
Testing estimates, judgements, and key assumptions made in preparation of the financial statements for indicators of management bias; and
Asserting financial statement disclosures, and agreeing these to supporting evidence, for compliance with applicable laws and regulations.
SECRETARIAT INTERNATIONAL UK LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF SECRETARIAT INTERNATIONAL UK LTD
- 7 -
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involved deliberate concealment by, for example, forgery or intentional misrepresentation, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company's 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.
James Moody
Senior Statutory Auditor
For and on behalf of Kirk Rice LLP
13 November 2024
Statutory Auditor
Zeeta House
200 Upper Richmond Road
Putney
London
SW15 2SH
SECRETARIAT INTERNATIONAL UK LTD
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
4
18,543,685
13,544,200
Cost of sales
(16,046,807)
(9,329,797)
Gross profit
2,496,878
4,214,403
Administrative expenses
(2,532,859)
(4,281,514)
Operating loss
5
(35,981)
(67,111)
Interest receivable and similar income
8
1,458
Loss before taxation
(34,523)
(67,111)
Tax on loss
9
(24,007)
(11,660)
Loss for the financial year
(58,530)
(78,771)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
SECRETARIAT INTERNATIONAL UK LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
£
£
Loss for the year
(58,530)
(78,771)
Other comprehensive income
Currency translation (loss)/gain arising in the year
(116,039)
169,923
Total comprehensive income for the year
(174,569)
91,152
SECRETARIAT INTERNATIONAL UK LTD
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
52,443
83,311
Current assets
Debtors
11
17,687,895
8,608,340
Cash at bank and in hand
1,903,685
1,158,130
19,591,580
9,766,470
Creditors: amounts falling due within one year
12
(18,280,356)
(8,314,296)
Net current assets
1,311,224
1,452,174
Total assets less current liabilities
1,363,667
1,535,485
Provisions for liabilities
Deferred tax liability
13
13,111
10,360
(13,111)
(10,360)
Net assets
1,350,556
1,525,125
Capital and reserves
Called up share capital
15
100
100
Other reserves
53,884
169,923
Profit and loss reserves
1,296,572
1,355,102
Total equity
1,350,556
1,525,125
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 13 November 2024 and are signed on its behalf by:
Mr J Little
Director
Company registration number 09692990 (England and Wales)
SECRETARIAT INTERNATIONAL UK LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Currency translation reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
100
1,433,873
1,433,973
Year ended 31 December 2022:
Loss
-
-
(78,771)
(78,771)
Other comprehensive income:
Currency translation differences
-
169,923
169,923
Total comprehensive income
-
169,923
(78,771)
91,152
Balance at 31 December 2022
100
169,923
1,355,102
1,525,125
Year ended 31 December 2023:
Loss
-
-
(58,530)
(58,530)
Other comprehensive income:
Currency translation differences
-
(116,039)
(116,039)
Total comprehensive income
-
(116,039)
(58,530)
(174,569)
Balance at 31 December 2023
100
53,884
1,296,572
1,350,556
SECRETARIAT INTERNATIONAL UK LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
17
1,189,979
74,522
Income taxes paid
(298,865)
(108,193)
Net cash inflow/(outflow) from operating activities
891,114
(33,671)
Investing activities
Purchase of tangible fixed assets
(40,167)
(53,015)
Interest received
1,458
Net cash used in investing activities
(38,709)
(53,015)
Net increase/(decrease) in cash and cash equivalents
852,405
(86,686)
Cash and cash equivalents at beginning of year
1,158,130
1,062,277
Effect of foreign exchange rates
(106,850)
182,539
Cash and cash equivalents at end of year
1,903,685
1,158,130
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
1
Accounting policies
Company information
Secretariat International UK Ltd is a private company limited by shares incorporated in England and Wales. The registered office is 22 Bishopsgate, 22nd Floor, London, England, EC2N 4BQ.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company (see note 2). 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.
Management are in the process of restructuring the group by moving all UK operations to the company's sister entity, Secretariat Partners UK LLP, with the goal of closing down the company once all operations and activity have been successfully transferred.
1.3
Turnover
Sales revenue is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
The Company’s revenue is primarily from contracts for expert advisory services in the dispute resolution process to clients globally. Revenue is recognised when the Company satisfies a performance obligation by transferring goods or services promised in a contract to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods and services. Performance obligations in the Company’s contracts represent distinct or separate streams that it provides to its customers.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Fixtures and fittings
14% on cost
Computer equipment
33% on cost
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.5
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.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.8
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.
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.
1.9
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.
1.10
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.11
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
1.12
Expenses are recorded as incurred and predominantly consist of wages, staff costs and management charges.
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
2
Change in accounting policy
During the year ended 31 December 2023, the company elected to change the presentational currency of it's financial statements from US Dollars (USD) to Great British Pounds (GBP). This change was made to reflect the increased significance of GBP in the company's operations and to provide a more relevant presentation of the financial position, performance, and cash flows to users of the financial statements.
The change in presentational currency has been applied retrospectively in accordance with FRS 102. The financial statements, including comparative figures, have been restated as if GBP had always been the company’s presentational currency.
The following exchange rates were used in the restatement process:
- Comparative closing exchange rate as at 31 December 2022: 1.2054 USD = 1 GBP
- Comparative average exchange rate for the year ended 31 December 2022: 1.2495 USD = 1 GBP
The comparatives for the year ended 31 December 2022 have been restated in GBP as follows:
- Revenue for 2022 was originally reported as $16,922,909, now restated as £13,544,200.
- Total assets at 31 December 2022 were originally reported as $11,872,925, now restated as £9,849,781.
- Total equity at 31 December 2022 was originally reported as $1,838,385 now restated as £1,525,125.
- Loss for the year at 31 December 2022 was originally reported as $97,050 now restated as £78,771.
3
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.
4
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Consulting income
18,543,685
13,544,200
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
4
Turnover and other revenue
(Continued)
- 18 -
2023
2022
£
£
Turnover analysed by geographical market
UK
2,948,107
4,469,586
Qatar
286,658
2,031,630
UAE
3,516,188
1,083,536
Oman
161,135
993,241
Italy
1,147,883
993,241
Rest of World
10,483,714
3,972,966
18,543,685
13,544,200
2023
2022
£
£
Other revenue
Interest income
1,458
-
5
Operating loss
2023
2022
Operating loss for the year is stated after charging:
£
£
Exchange losses
11,144
175,717
Depreciation of owned tangible fixed assets
61,846
31,128
6
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
22,000
20,409
For other services
Taxation compliance services
6,250
10,457
All other non-audit services
6,750
1,826
13,000
12,283
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
7
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Billable Consultants
28
31
Delay
1
1
Business Development
1
1
Total
30
33
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
6,553,406
7,494,813
Social security costs
955,544
969,644
Pension costs
183,393
179,674
7,692,343
8,644,131
The average number of employees has reduced in the year as a result of a management decision to restructure the group by transferring employees from Secretariat International UK Limited to Secretariat Partners UK LLP.
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
1,458
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
1,458
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
21,256
12,996
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
2023
2022
£
£
(Continued)
- 20 -
Deferred tax
Origination and reversal of timing differences
2,751
(1,336)
Total tax charge
24,007
11,660
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(34,523)
(67,111)
Expected tax credit based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
(8,113)
(12,751)
Tax effect of expenses that are not deductible in determining taxable profit
50,620
19,949
Unutilised tax losses carried forward
(11,861)
40,395
Effect of change in corporation tax rate
229
Permanent capital allowances in excess of depreciation
(9,439)
(12,633)
Under/(over) provided in prior years
12,995
Deferred tax adjustments in respect of prior years
2,571
(1,336)
Foreign exchange differences
17,564
Renumeration unpaid
(52,523)
Taxation charge for the year
24,007
11,660
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
10
Tangible fixed assets
Fixtures and fittings
Computer equipment
Total
£
£
£
Cost
At 1 January 2023
36,483
144,776
181,259
Additions
9,868
30,299
40,167
Disposals
(32,631)
(60,916)
(93,547)
Exchange adjustments
(3,852)
(13,358)
(17,210)
At 31 December 2023
9,868
100,801
110,669
Depreciation and impairment
At 1 January 2023
22,786
75,162
97,948
Depreciation charged in the year
12,533
49,313
61,846
Eliminated in respect of disposals
(32,631)
(60,916)
(93,547)
Exchange adjustments
(1,866)
(6,155)
(8,021)
At 31 December 2023
822
57,404
58,226
Carrying amount
At 31 December 2023
9,046
43,397
52,443
At 31 December 2022
13,697
69,614
83,311
11
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
6,157,848
7,798,782
Amounts owed by group undertakings
9,303,824
Other debtors
111,158
520,108
Prepayments and accrued income
2,115,065
258,947
17,687,895
8,577,837
2023
2022
Amounts falling due after more than one year:
£
£
Other debtors
30,503
Total debtors
17,687,895
8,608,340
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
12
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
166,130
271,302
Amounts owed to group undertakings
15,346,073
5,119,715
Corporation tax
21,256
298,865
Other taxation and social security
232,176
334,803
Other creditors
420,942
628,885
Accruals and deferred income
2,093,779
1,660,726
18,280,356
8,314,296
13
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
13,111
20,828
Tax losses
-
(10,468)
13,111
10,360
2023
Movements in the year:
£
Liability at 1 January 2023
10,360
Charge to profit or loss
2,751
Liability at 31 December 2023
13,111
The deferred tax liability set out above is expected to reverse within future years and relates to accelerated capital allowances that are expected to mature within the same period.
14
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
183,393
179,674
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.
SECRETARIAT INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
15
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
The company has one class of ordinary shares which carry equal rights.
16
Ultimate controlling party and parent company
The company's parent is Secretariat International Inc., incorporated in the US, with the company's registered office address 1175 Peachtree Street NE, 100 Colony Square - Suite 400, Atlanta, GA 30361, United States.
The company's ultimate controlling party is JLL Partners Fund VII Secondary (S) Aggregator, LLC, incorporated in the US. The principal place of business for JLL Partners Fund VII Secondary (S) Aggregator, LLC is 300 Park Avenue, 18th Floor, New York, NY 10022, United States.
The parent of the smallest group preparing consolidated accounts of which the company is a member is Secretariat Advisors LLC, incorporated in the US. The registered office address for Secretariat Advisors LLC is 1175 Peachtree Street NE, 100 Colony Square - Suite 400, Atlanta, GA 30361, United States.
17
Cash generated from operations
2023
2022
£
£
Loss for the year after tax
(58,530)
(78,771)
Adjustments for:
Taxation charged
24,007
11,660
Investment income
(1,458)
Depreciation and impairment of tangible fixed assets
61,846
31,128
Movements in working capital:
(Increase)/decrease in debtors
(9,079,555)
1,533,540
Increase/(decrease) in creditors
10,243,669
(1,423,035)
Cash generated from operations
1,189,979
74,522
18
Analysis of changes in net funds
1 January 2023
Cash flows
Exchange rate movements
31 December 2023
£
£
£
£
Cash at bank and in hand
1,158,130
852,405
(106,850)
1,903,685
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