Registration number:
Rock Compliance Limited
for the Year Ended 31 March 2024
Rock Compliance Limited
Contents
Company Information |
|
Strategic Report |
|
Directors' Report |
|
Statement of Directors' Responsibilities |
|
Independent Auditor's Report |
|
Profit and Loss Account |
|
Statement of Financial Position |
|
Statement of Changes in Equity |
|
Statement of Cash Flows |
|
Notes to the Financial Statements |
Rock Compliance Limited
Company Information
Directors |
Joshua Segal Shaun Michael Sinclair William Hazell-Smith Mark Taylor |
Registered office |
|
Auditors |
|
Rock Compliance Limited
Strategic Report for the Year Ended 31 March 2024
The directors present their strategic report for the year ended 31 March 2024.
Principal activity
The principal activity of the company is to deliver services to the compliance market, with fundamental principles: in minimising risk, delivering compliance and making it simple for their clients. These services are within the air and water sectors.
Fair review of the business
The company's key financial and other performance indicators during the year were as follows:
Financial KPIs |
Unit |
2024 |
2023 |
Sales |
£ |
20,338,054 |
19,334,007 |
(Loss)/profit before taxation |
£ |
3,248,314 |
(914,659) |
EBITDA |
£ |
3,808,389 |
(321,771) |
EBITDA (excluding exceptional costs) |
£ |
503,237 |
500,629 |
Principal risks and uncertainties
Market Awareness
Macroeconomic Market
We closely monitor all activity in the markets in which we operate, keeping watch, in particular, on changes in the macroeconomic environment. Our view of the UK compliance market remains unchanged over the past year: the fundamentals remain strong, and the demand versus supply dynamics provides significant comfort due to compliance being a mandatory requirement.
Brexit
In common with other companies in our industry, and indeed other sectors, a consequence of Brexit has been the availability of labour. The company is no different to our competitors in this regard and is working hard to retain skills and labour, and to attract and train new labour.
Assessment of viability
Our Risk Plan is subject to differing scenarios to assess those risks and quantify their impact on Rock Compliance Limited. The most significant risk is the shortage of skilled labour and the ability to recruit.
The company has a detailed mitigation plan for a skilled labour shortage under the following headings;
People
• Sustain flexible and remote working arrangements;
• Establish our internal School of Rock designed to train employees to the specific standard required;
• Assess the sufficiency of employee compensation packages to ensure retention of skilled labour;
• Perform regular employee surveys to ensure high levels of satisfaction.
We recognise the importance of having engaged employees within our business. We support their progress and development through structured careers and training through the School of Rock. During the pandemic and subsequently we have supported flexible and remote working arrangements and performed regular employee surveys to ensure high levels of satisfaction as well as assessing the sufficiency of employee compensation packages to ensure retention of skilled labour.
Rock Compliance Limited
Strategic Report for the Year Ended 31 March 2024
Protect Business Continuity
• Keep trading mindset;
• Keep customer appraised of goods and services;
• Stay in contact with suppliers to ensure continuity of supply;
• Review terms and conditions on commercial relationships;
• Develop and test continuity scenarios.
Build And Secure Liquidity
• Bring cash and debt under central control and increased rigour;
• Build portfolio of cash improvement projects;
• Manage liquidity impact of disruption between finance and operations;
• Tighten controls around customer exposure and collections.
Engage Stakeholders
• A cross functional response team to address emerging challenges;
• Understand critical stakeholders priorities.
It should be noted that the compliance services that Rock Compliance Limited provide are mandatory, under a number of regulations concerning air quality and the control of legionella. This acts to mitigate Rock Compliance Limited from revenue reductions.
Going Concern
After due consideration of the impact of the profit incurred (prior to taking account of the exceptional income credit of £3.5m) during the year ending 31 March 2024 and as a result of the work undertaken above to support the Risk Plan, the Directors consider it appropriate to prepare the financial statements on a going concern basis, which is further explained at Note 2.
Section 172(1) statement
This section of the Strategic Report describes how the Directors have had regard to the matters set out in section 172 (1) (a) to (f), and forms the Directors’ statement required under section 414CZA of the Companies Act 2006.
The Directors recognise that the long-term success of the company is dependent on having regard to the interests of its stakeholders. The Board has identified and documented its key stakeholders which include its shareholders, investors, employees, clients, suppliers and the wider community and the environment. Stakeholder engagement is considered a part of the decision making process of the Board.
The Board recognises the importance of engaging with stakeholders, understanding their views, and interests in order to run a successful company over the long-term. Dialogue with stakeholders can help the Board to understand significant changes in the landscape, predict future trends, and to develop strategy that is aligned to stakeholder interests.
Employees:
The Board recognises the importance of a strong relationship with its employees. Motivated employees bring success to the company.
Rock Compliance Limited
Strategic Report for the Year Ended 31 March 2024
Clients:
The Board recognises the importance of a strong relationship with its clients by providing the services that they require. Regular contact is maintained with clients through the account manager network.
Suppliers:
There are a number of key suppliers that provide goods and services to the group. Through professional procurement activity Rock addresses both risks and opportunities within the supply chain.
Community and Environment:
The Directors acknowledge the requirement to consider Community and Environment. It is critical to all involved that the confidence of the investor community is maintained. The environment in which the company operates is one where trust and confidence are essential, and the Board recognise this in all decision making.
Non-financial information
Equality and Diversity Statement
The company has an inclusive environment that is based on the selection and retention of its employees on the basis of individual ability and achievement, where all employees can develop their full potential. This positive approach to promoting diversity is a key element of its strategy for success as an inclusive employer.
The company understands the importance of its most valuable assets - its employees, customers and stakeholders and continues to work towards ensuring that equality of opportunity is embedded within policies, practices and procedures. It endeavours to ensure that no employees, customers, contractors and/or visitors suffer any discrimination, nor are they disadvantaged because of age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, sexual orientation or any other prejudice identified in Statutory Legislation.
Approved and authorised by the
......................................... |
Rock Compliance Limited
Directors' Report for the Year Ended 31 March 2024
The directors present their report and the financial statements for the year ended 31 March 2024.
Directors of the company
The directors who held office during the year were as follows:
The following director was appointed after the year end:
Going concern
After due consideration of the impact on the company of the profit incurred (prior to taking account of the exceptional income credit of £3.5m) during the year ended 31 March 2024 due to its continued integration and growth strategy, the directors believe the company is well placed to manage its risks in the foreseeable future and have done so by securing additional shareholder debt of £0.8m in the group post year-end (with further funds committed should they be required), implementing further cost cutting measures and a number of recent wins of large contracts worth over an estimated £2.5m per annum of revenue. The directors are fully focussed on the sustainability of the business and are exploring multiple options with expected positive outcomes to preserve the going concern status of the group. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
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.
Approved and authorised by the
......................................... |
Rock Compliance Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities 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 apply them consistently; |
• |
make judgements and accounting estimates that are reasonable and prudent; |
• |
state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
• |
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.
Rock Compliance Limited
Independent Auditor's Report to the Members of Rock Compliance Limited
Opinion
We have audited the financial statements of Rock Compliance Limited (the 'company') for the year ended 31 March 2024, which comprise the Profit and Loss Account, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of 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 March 2024 and of its profit 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. |
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 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 director's 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 original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
Rock Compliance Limited
Independent Auditor's Report to the Members of Rock Compliance Limited
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• |
the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
• |
the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our 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 and the Directors' Report.
We have nothing to report in respect of the following matters where 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 directors' 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 Statement of Directors' Responsibilities, set out on page 6, 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.
Rock Compliance Limited
Independent Auditor's Report to the Members of Rock Compliance Limited
Auditor 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.
Extent to which the audit was considered capable of detecting irregularities, including fraud
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
Identifying and assessing potential risks related to irregularities
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:
• |
the nature of the industry, control environment and understanding of the entity including, but not restricted to, the prevalence of fraud in the sector especially in the current uncertain economic environment; |
• |
results of our enquiries of directors about their own identification and assessment of the risks of irregularities; |
• |
any matters we identified having obtained and reviewed the company’s documentation of their policies and procedures relating to: |
• |
identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of noncompliance; |
• |
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; |
• |
the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations; |
• |
the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. |
As a result of these procedures, we considered the opportunities that may exist within the organisation for fraud and identified the greatest potential for fraud in relation to revenue recognition and overstatement of expenditure. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006 and UK tax legislation.
Rock Compliance Limited
Independent Auditor's Report to the Members of Rock Compliance Limited
Our procedures to respond to risks identified included the following:
• |
reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements; |
• |
enquiring of directors concerning actual and potential litigation and claims; |
• |
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; |
• |
tested a sample of other income for understatement and other relevant audit procedures while consideration was given to revenue recognition; |
• |
tested a sample of expenditure for overstatement and other relevant audit procedures; |
• |
in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. |
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or noncompliance with laws and regulations throughout the audit.
Due to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing fraud or non-compliance with laws and regulations and cannot be expected to detect all fraud and non-compliance with laws and regulations.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Rock Compliance Limited
Independent Auditor's Report to the Members of Rock Compliance Limited
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.
......................................
For and on behalf of
Chartered Accountants
6 Atholl Crescent
PH1 5JN
Rock Compliance Limited
Profit and Loss Account for the Year Ended 31 March 2024
Note |
2024 |
2023 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Exceptional costs |
|
( |
|
Operating profit/(loss) |
3,372,431 |
(860,030) |
|
Other interest receivable and similar income |
|
|
|
Interest payable and similar expenses |
( |
( |
|
(124,117) |
(54,629) |
||
Profit/(loss) before tax |
|
( |
|
Tax on profit/(loss) |
|
|
|
Profit/(loss) for the financial year |
|
( |
The above results were derived from continuing operations.
The company has no recognised gains or losses for the year other than the results above.
Rock Compliance Limited
(Registration number: 02902353)
Statement of Financial Position as at 31 March 2024
Note |
2024 |
2023 |
|
Fixed assets |
|||
Intangible assets |
|
|
|
Tangible assets |
|
|
|
|
|
||
Current assets |
|||
Stocks |
|
|
|
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets/(liabilities) |
|
( |
|
Total assets less current liabilities |
|
|
|
Creditors: Amounts falling due after more than one year |
( |
( |
|
Net assets/(liabilities) |
|
( |
|
Capital and reserves |
|||
Called up share capital |
202 |
202 |
|
Share premium reserve |
204,900 |
204,900 |
|
Retained earnings |
3,079,778 |
(322,418) |
|
Shareholders' funds/(deficit) |
3,284,880 |
(117,316) |
Approved and authorised by the
......................................... |
Rock Compliance Limited
Statement of Changes in Equity for the Year Ended 31 March 2024
Share capital |
Share premium |
Retained earnings |
Total |
|
At 1 April 2023 |
|
|
( |
( |
Profit for the year |
- |
- |
|
|
At 31 March 2024 |
|
|
|
|
Share capital |
Share premium |
Retained earnings |
Total |
|
At 1 April 2022 |
|
|
|
|
Loss for the year |
- |
- |
( |
( |
At 31 March 2023 |
202 |
204,900 |
(322,418) |
(117,316) |
Rock Compliance Limited
Statement of Cash Flows for the Year Ended 31 March 2024
Note |
2024 |
2023 |
|
Cash flows from operating activities |
|||
Profit/(loss) for the year |
|
( |
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
Profit on disposal of tangible assets |
( |
( |
|
Finance income |
( |
( |
|
Finance costs |
|
|
|
Income tax expense |
( |
( |
|
|
( |
||
Working capital adjustments |
|||
(Increase)/decrease in stocks |
( |
|
|
Increase in trade debtors |
( |
( |
|
(Decrease)/increase in trade creditors |
( |
|
|
Cash generated from operations |
|
|
|
Income taxes received |
|
|
|
Net cash flow from operating activities |
|
|
|
Cash flows from investing activities |
|||
Interest received |
|
|
|
Acquisitions of tangible assets |
( |
( |
|
Proceeds from sale of tangible assets |
- |
|
|
Acquisition of intangible assets |
( |
( |
|
Net cash flows from investing activities |
( |
( |
|
Cash flows from financing activities |
|||
Interest paid |
( |
( |
|
Repayment of other borrowing |
( |
( |
|
Payments to finance lease creditors |
( |
|
|
Net cash flows from financing activities |
( |
|
|
Net increase/(decrease) in cash and cash equivalents |
|
( |
|
Cash and cash equivalents at 1 April |
|
|
|
Cash and cash equivalents at 31 March |
260,714 |
223,211 |
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
General information |
The company is a private company limited by share capital, incorporated in England.
The address of its registered office is:
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
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.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
The financial statements are presented in sterling (£) and rounded to the nearest £1,
Going concern
After due consideration of the impact on the company of the profit incurred (prior to taking account of the exceptional income credit of £3.5m) during the year ended 31 March 2024 due to its continued integration and growth strategy, the directors believe the company is well placed to manage its risks in the foreseeable future and have done so by securing additional shareholder debt of £0.8m in the group post year-end (with further funds committed should they be required), implementing further cost cutting measures and a number of recent wins of large contracts worth over an estimated £2.5m per annum of revenue. The directors are fully focussed on the sustainability of the business and are exploring multiple options with expected positive outcomes to preserve the going concern status of the group. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.
The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.
Government grants
Grants towards revenue expenditure are released to the profit and loss account as the related expenditure is incurred.
Foreign currency transactions and balances
Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.
Tangible assets
Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Land and buildings |
25% straight line |
Plant and machinery |
25% straight line |
Furniture, fittings and equipment |
15% straight line |
Motor vehicles |
25% straight line |
Office equipment |
25% straight line |
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
Asset class |
Amortisation method and rate |
Internally generated software |
10% straight line |
Innovation/learning development |
20% straight line |
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and bank deposits.
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.
Inventories
Inventories are stated at the lower of cost and estimated selling price less costs to complete and sell.
The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
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 settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, 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.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance costs in the profit and loss account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.
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.
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Financial instruments
Turnover |
The analysis of the company's Turnover for the year from continuing operations is as follows:
2024 |
2023 |
|
Rendering of services |
|
|
Other gains and losses |
The analysis of the company's other gains and losses for the year is as follows:
2024 |
2023 |
|
Gain on disposal of Tangible assets |
|
|
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Operating profit/(loss) |
Arrived at after charging/(crediting)
2024 |
2023 |
|
Depreciation expense |
|
|
Amortisation expense |
|
|
Operating lease expense - plant and machinery |
|
|
Profit on disposal of property, plant and equipment |
( |
( |
Other interest receivable and similar income |
2024 |
2023 |
|
Interest income on bank deposits |
|
|
Interest payable and similar expenses |
2024 |
2023 |
|
Interest on bank overdrafts and borrowings |
|
|
Interest on obligations under finance leases and hire purchase contracts |
|
|
Other interest expense |
|
- |
|
|
Exceptional Costs |
A Group reconstruction took place on 31 August 2021 and 31 August 2022. The accounts include non-recurring, exceptional costs of £180,898 (2023: £808,184) in relation to the restructuring.
The accounts also include non-recurring, exceptional costs of £nil (2023: £2,216) in relation to Acquisitions & Financing, £13,950 (2023: £12,000 cost) in relation to Non-operating costs and a credit £3,500,000 (2023: £nil) which represents loan forgiveness between the parent entity and subsidiary.
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2024 |
2023 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Other short-term employee benefits |
|
|
Pension costs, defined contribution scheme |
|
|
Other employee expense |
|
|
|
|
The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:
2024 |
2023 |
|
Production |
|
|
Administration and support |
|
|
Sales |
|
|
|
|
Directors' remuneration |
The directors believe that the remuneration package of the highest paid director is commercially sensitive information and have therefore decided not to disclose this in the financial statements.
Auditors' remuneration |
2024 |
2023 |
|
Audit of the financial statements |
|
|
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Taxation |
Tax charged/(credited) in the profit and loss account
2024 |
2023 |
|
Current taxation |
||
UK corporation tax |
( |
( |
Deferred taxation |
||
Arising from origination and reversal of timing differences |
( |
( |
Tax receipt in the income statement |
( |
( |
The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2023 - the same as the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2024 |
2023 |
|
Profit/(loss) before tax |
|
( |
Corporation tax at standard rate |
|
- |
Tax increase from effect of capital allowances and depreciation |
|
|
Other tax effects for reconciliation |
( |
- |
Effect of tax losses |
( |
( |
Research & Development tax credit |
( |
( |
Total tax credit |
( |
( |
Deferred tax
Deferred tax assets and liabilities
2024 |
Asset |
Accelerated tax depreciation |
|
Tax losses |
( |
( |
2023 |
Asset |
Accelerated tax depreciation |
|
Tax losses |
( |
( |
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
The amount of the net reversal of deferred tax assets and deferred tax liabilities expected to occur during the year beginning after the reporting period is £(51,489) (2023 - £(24,135)).
Intangible assets |
Goodwill |
Internally generated software development costs |
Other intangible assets |
Total |
|
Cost or valuation |
||||
At 1 April 2023 |
|
|
|
|
Additions |
- |
|
|
|
At 31 March 2024 |
|
|
|
|
Amortisation |
||||
At 1 April 2023 |
|
|
|
|
Amortisation charge |
- |
|
|
|
At 31 March 2024 |
|
|
|
|
Carrying amount |
||||
At 31 March 2024 |
- |
|
|
|
At 31 March 2023 |
- |
|
|
|
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Tangible assets |
Land and buildings |
Furniture, fittings and equipment |
Motor vehicles |
Total |
|
Cost or valuation |
||||
At 1 April 2023 |
|
|
|
|
Impairment |
- |
- |
( |
( |
Additions |
- |
|
- |
|
At 31 March 2024 |
|
|
|
|
Depreciation |
||||
At 1 April 2023 |
|
|
|
|
Charge for the year |
- |
|
|
|
Impairment |
- |
- |
( |
( |
At 31 March 2024 |
|
|
|
|
Carrying amount |
||||
At 31 March 2024 |
- |
|
|
|
At 31 March 2023 |
- |
|
|
|
Stocks |
2024 |
2023 |
|
Other stock |
|
|
Debtors |
Current |
Note |
2024 |
2023 |
Trade debtors |
|
|
|
Other debtors |
|
|
|
Prepayments |
|
|
|
Accrued income |
|
|
|
Deferred tax assets |
|
|
|
|
|
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Cash and cash equivalents |
2024 |
2023 |
|
Cash on hand |
- |
|
Cash at bank |
|
|
Short-term deposits |
- |
|
|
|
Creditors |
Note |
2024 |
2023 |
|
Due within one year |
|||
Loans and borrowings |
|
|
|
Trade creditors |
|
|
|
Amounts due to related parties |
|
|
|
Social security and other taxes |
|
|
|
Outstanding defined contribution pension costs |
|
|
|
Other payables |
|
|
|
Accruals |
|
|
|
Income tax liability |
137,073 |
267,673 |
|
|
|
||
Due after one year |
|||
Loans and borrowings |
|
|
Provisions for liabilities |
Deferred tax |
Total |
|
At 1 April 2023 |
|
|
Additional provisions |
|
|
At 31 March 2024 |
|
|
|
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Pension and other schemes |
Defined contribution pension scheme
The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £
Contributions totalling £
Share capital |
Allotted, called up and fully paid shares
2024 |
2023 |
|||
No. |
£ |
No. |
£ |
|
|
|
202 |
|
202 |
Reserves |
Called up share capital
Represents the nominal value of the shares issued.
Share premium reserve
Represents the premium value of the shares issued.
Profit and loss account
Includes current period retained profits and losses.
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Loans and borrowings |
Current loans and borrowings
2024 |
2023 |
|
Finance lease liabilities |
|
|
Other borrowings |
|
|
|
|
Non-current loans and borrowings
2024 |
2023 |
|
Finance lease liabilities |
|
|
Other borrowings |
|
|
|
|
Finance lease liabilities are secured over the assets to which they relate.
The other borrowings due at 31 March 2024 represent loans due to Funding Circle. The interest rate is 8.9% per annum with the final repayments due in April 2024 and September 2025.
Obligations under leases and hire purchase contracts |
Operating leases
The total of future minimum lease payments is as follows:
2024 |
2023 |
|
Not later than one year |
|
|
Later than one year and not later than five years |
|
|
Later than five years |
- |
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Contingent liabilities |
The company has given a guarantee in respect of the bank borrowings of the parent company, which amounted to £2,825,000 at 31 March 2024 (2023: £3,325,000). The guarantee is secured by a charge on the company's assets.
The company has also given a guarantee in respect of the issue of loan notes by the parent company, which amounts to £3,087,926 at 31 March 2024 (2023: £1,523,459). The guarantee is secured by a fixed and floating charge over the company's assets, subject to the terms of an Intercreditor Agreement.
Analysis of changes in net debt |
At 1 April 2023 |
Financing cash flows |
At 31 March 2024 |
|
Cash and cash equivalents |
|||
Cash |
223,211 |
36,098 |
259,309 |
Borrowings |
|||
Long term borrowings |
(45,167) |
30,788 |
(14,379) |
Short term borrowings |
(149,378) |
26,426 |
(122,952) |
Lease liabilities |
(389,402) |
138,690 |
(250,712) |
(583,947) |
195,904 |
(388,043) |
|
( |
|
( |
|
|
Related party transactions |
Summary of transactions with other related parties
Bridgeford Technologies Limited
During the year ended 31 March 2024, Bridgeford Technologies Limited (W Hazell-Smith and J Segal are directors) charged Rock Compliance Limited for services under normal commercial terms. The total paid during the year was £150,518 (2023: £143,218).
At 31 March 2024, the balance due from Rock Compliance Limited to Bridgeford Technologies Limited was £14,204 (2023: £264).
Rock Compliance Limited
Notes to the Financial Statements for the Year Ended 31 March 2024
Parent and ultimate parent undertaking |
The ultimate controlling party is Rock Compliance Holdings Limited, a company incorporated in England and Wales.
The most senior parent entity producing publicly available financial statements is Rock Compliance Holdings Limited. These financial statements are available from Registrar of Companies, Crown Way, Cardiff.