Company Registration No. 06958532 (England and Wales)
SHELDON DAVIDSON SOLICITORS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
SHELDON DAVIDSON SOLICITORS LIMITED
COMPANY INFORMATION
Director
Mr S Davidson
Secretary
Mr S Davidson
Company number
06958532
Registered office
219 Bury New Road
Whitefield
Manchester
M45 8GW
Auditor
Jack Ross Limited
Barnfield House
The Approach
Manchester
M3 7BX
Business address
219 Bury New Road
Whitefield
Manchester
M45 8GW
SHELDON DAVIDSON SOLICITORS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Director's report
3
Director's responsibilities statement
4
Independent auditor's report
5 - 8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 31
SHELDON DAVIDSON SOLICITORS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The director presents the strategic report for the year ended 31 December 2023.

Fair review of the business
Principal risks and uncertainties

In the opinion of management, the principal risks and areas of uncertainty which could potentially impact on the business are the implementation of the new Intermediate Track with the fixed costs implemented on 1st Oct 2023 and the plans to expand and implement fixed costs in Clinical Negligence claims. Management is aware of the risks and are undertaking restructuring of the business to mitigate the risks and to ensure that the company is well placed to take advantage of future opportunities in the sector.

 

As with all businesses in the current economic environment there is also a risk regarding the long-term recoverability of costs and management continue to strengthen and implement systems to ensure that any potential impact on the business is minimised.

 

Development and performance

The principal activity of the parent company continues to be that of the provision of legal services to the public. This includes principally personal injury in road traffic accident claims but also employer’s, public and occupier’s liability claims medical negligence claims to include claims in which clients have sustained serious and life changing injuries.

 

The company currently has a majority shareholding in the subsidiary company Access Hire & Finance Ltd. The principal activity of this subsidiary company is accident management including the short-term hiring of motor vehicles to victims of non-fault accidents. Management expects there to continue to be significant synergies between the parent company and the subsidiary which the combined group is better placed to exploit.

 

During the year the turnover of the group has increased by 4.3%.

The volume of new instructions received during the prior year consisted of a significant number of low value RTA personal injury claims handled on the Official Injury Claims Portal (OIC) implemented under the Governments PI reforms. Turnover, settlement and revenues from such claims significantly improved in the year ended 2023 and is expected to grow in 2024. The focus on maximising revenue from the muti track higher value, serious injury and clinical negligence departments continued. Both higher value and clinical negligence claims have a longer tail to conclusion which does impact turnover in the short-medium term. The volume of new instructions in the year was expected to be in line with the prior year

 

Whilst the impact of Covid-19 continued to be significant disruptor in 2021 and 2022 the company has now recovered significantly from the impact of Covid.

 

Management remains confident that the company has the infrastructure to be able to perform strongly in future periods despite the challenges facing the sector.

 

At the balance sheet date, the group has a strong balance sheet with net assets of £2,794,435.

 

Key performance indicators

 

2023          2022         Change

Turnover        £7,552k        £7,243k        4.3%

EBITDA        £1,118k        £532k        110.0%

Net assets    £2,794k        £2,661k         5.0%

On behalf of the board

Mr S Davidson
SHELDON DAVIDSON SOLICITORS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Director
7 February 2025
SHELDON DAVIDSON SOLICITORS LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

The director presents his annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the parent company and group continued to be that of the provision of legal services.

 

The principal activity of the subsidiary company, Access Hire & Finance Ltd, is that of the short-term leasing of motor vehicles.

Director

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

Mr S Davidson
Results and dividends

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £95,833. The director does not recommend payment of a further dividend.

Financial instruments

The Group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the Group has sufficient liquid resources to meet the operating needs of the businesses.

 

Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an on-going basis and provision is made for doubtful debts where necessary.

Auditor

In accordance with the company's articles, a resolution proposing that Jack Ross Limited be reappointed as auditor of the group will be put at a General Meeting.

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 auditor of the company and group 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 auditor of the company and group is aware of that information.

On behalf of the board
Mr S Davidson
Director
7 February 2025
SHELDON DAVIDSON SOLICITORS LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -

The director is responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the director is required to:

 

 

The director is responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

SHELDON DAVIDSON SOLICITORS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SHELDON DAVIDSON SOLICITORS LIMITED
- 5 -
Opinion

We have audited the financial statements of Sheldon Davidson Solicitors Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Group Statement of Comprehensive Income, the Group Balance Sheet, the Company Balance Sheet, the Group Statement of Changes in Equity, the Company Statement of Changes in Equity, the Group 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of

accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or

conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a

going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the

relevant sections of this report.

 

 

Other information

The other information comprises the information included in the annual report other than the financial statements

and our auditor's report thereon. The directors are responsible for the other information contained within the

annual report. Our opinion on the financial statements does not cover the other information and, except to the

extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our

responsibility is to read the other information and, in doing so, consider whether the other information is

materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or

otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material

misstatements, we are required to determine whether this gives rise to a material misstatement in the financial

statements themselves. If, based on the work we have performed, we conclude that there is a material

misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

 

SHELDON DAVIDSON SOLICITORS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SHELDON DAVIDSON SOLICITORS LIMITED
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report and the Director's 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:

Responsibilities of director

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.

 

SHELDON DAVIDSON SOLICITORS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SHELDON DAVIDSON SOLICITORS LIMITED
- 7 -
Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures

in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities,

including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is

detailed below .

 

Extent to which the audit was considered capable of detecting irregularities, including fraud

Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to tax legislation and other legislation specific to the industry in which the company operates. We have considered the extent to which non-compliance might have a material effect on the financial statements. We also have considered those law and regulations that have a direct impact on the preparation of the financial statements such as Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including risk of override of controls) and determined that the principal risks related to management judgement of when to recognise income and expenditure and the effect this would have on profit.

 

Audit response to risks identified

The auditor’s explanation of its audit response will depend on the risks identified but may include:

- Enquiry of management, those charged with governance

- Enquiry of entity staff in compliance functions to identify any instances of non-compliance with laws and regulations.

- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.

- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.

 

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. 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 involve concealment.

 

 

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s 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.

 

 

 

SHELDON DAVIDSON SOLICITORS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SHELDON DAVIDSON SOLICITORS LIMITED
- 8 -
Umar Memon FCA (Senior Statutory Auditor)
for and on behalf of Jack Ross Limited
7 February 2025
Chartered Accountants
Statutory Auditor
Barnfield House
The Approach
Manchester
M3 7BX
SHELDON DAVIDSON SOLICITORS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
7,552,035
7,242,819
Cost of sales
(3,039,100)
(3,430,626)
Gross profit
4,512,935
3,812,193
Administrative expenses
(3,727,308)
(3,665,566)
Operating profit
4
785,627
146,627
Interest receivable and similar income
9
49,780
5,909
Interest payable and similar expenses
10
(476,415)
(318,779)
Profit/(loss) before taxation
358,992
(166,243)
Taxation
11
(129,297)
7,626
Profit/(loss) for the financial year
229,695
(158,617)
Profit/(loss) for the financial year is attributable to:
- Owners of the parent company
36,200
(248,824)
- Non-controlling interests
193,495
90,207
229,695
(158,617)
Total comprehensive income for the year is attributable to:
- Owners of the parent company
36,200
(248,824)
- Non-controlling interests
193,495
90,207
229,695
(158,617)

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

SHELDON DAVIDSON SOLICITORS LIMITED
GROUP BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
253,913
492,101
Tangible assets
13
295,449
415,233
549,362
907,334
Current assets
Debtors
17
9,266,439
8,172,416
Cash at bank and in hand
34,694
2,058
9,301,133
8,174,474
Creditors: amounts falling due within one year
18
(6,112,013)
(5,732,848)
Net current assets
3,189,120
2,441,626
Total assets less current liabilities
3,738,482
3,348,960
Creditors: amounts falling due after more than one year
19
(935,098)
(677,644)
Provisions for liabilities
22
(8,949)
(10,743)
Net assets
2,794,435
2,660,573
Capital and reserves
Called up share capital
23
1,100,001
1,100,001
Profit and loss reserves
1,227,724
1,218,607
Equity attributable to owners of the parent company
2,327,725
2,318,608
Non-controlling interests
466,710
341,965
2,794,435
2,660,573
The financial statements were approved and signed by the director and authorised for issue on 7 February 2025
07 February 2025
Mr S Davidson
Director
SHELDON DAVIDSON SOLICITORS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
232,500
465,000
Tangible assets
13
47,395
66,394
Investments
14
270,013
270,013
549,908
801,407
Current assets
Debtors
17
4,127,869
3,742,878
Cash at bank and in hand
708
2,046
4,128,577
3,744,924
Creditors: amounts falling due within one year
18
(1,935,227)
(1,973,792)
Net current assets
2,193,350
1,771,132
Total assets less current liabilities
2,743,258
2,572,539
Creditors: amounts falling due after more than one year
19
(704,918)
(399,785)
Provisions for liabilities
22
(8,949)
(10,743)
Net assets
2,029,391
2,162,011
Capital and reserves
Called up share capital
23
1,100,001
1,100,001
Profit and loss reserves
929,390
1,062,010
Total equity
2,029,391
2,162,011

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £132,620 (2022: £349,745 loss).

The financial statements were approved and signed by the director and authorised for issue on 7 February 2025
07 February 2025
Mr S Davidson
Director
Company Registration No. 06958532
SHELDON DAVIDSON SOLICITORS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
Share capital
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
1,100,001
1,467,431
2,567,432
251,758
2,819,190
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
(248,824)
(248,824)
90,207
(158,617)
Balance at 31 December 2022
1,100,001
1,218,607
2,318,608
341,965
2,660,573
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
36,200
36,200
193,495
229,695
Dividends
-
-
-
(95,833)
(95,833)
Other movements
-
(27,083)
(27,083)
27,083
-
Balance at 31 December 2023
1,100,001
1,227,724
2,327,725
466,710
2,794,435
SHELDON DAVIDSON SOLICITORS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
1,100,001
1,411,755
2,511,756
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
(349,745)
(349,745)
Balance at 31 December 2022
1,100,001
1,062,010
2,162,011
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
(132,620)
(132,620)
Balance at 31 December 2023
1,100,001
929,390
2,029,391
SHELDON DAVIDSON SOLICITORS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
26
534,980
481,110
Interest paid
(476,415)
(318,779)
Income taxes paid
(47,065)
(36,964)
Net cash inflow from operating activities
11,500
125,367
Investing activities
Purchase of tangible fixed assets
(6,853)
(103,126)
Proceeds on disposal of tangible fixed assets
117,234
71,412
Proceeds from other investments and loans
12,561
(36,387)
Interest received
49,780
5,909
Net cash generated from/(used in) investing activities
172,722
(62,192)
Financing activities
Proceeds from borrowings
1,274,432
-
Repayment of borrowings
(800,107)
125,651
Payment of finance leases obligations
(121,660)
(73,604)
Dividends paid to non-controlling interests
(83,333)
-
Net cash generated from financing activities
269,332
52,047
Net increase in cash and cash equivalents
453,554
115,222
Cash and cash equivalents at beginning of year
(1,208,777)
(1,323,999)
Cash and cash equivalents at end of year
(755,223)
(1,208,777)
Relating to:
Cash at bank and in hand
34,694
2,058
Bank overdrafts included in creditors payable within one year
(789,917)
(1,210,835)
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
1
Accounting policies
Company information

Sheldon Davidson Solicitors Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 219 Bury New Road, Whitefield, Manchester, M45 8GW.

 

The group consists of Sheldon Davidson Solicitors Ltd and all of its subsidiaries.

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. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.2
Basis of consolidation

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -

The consolidated financial statements incorporate those of Sheldon Davidson Solicitors Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.

 

All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates. In the group financial statements, associates are accounted for using the equity method.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. In the group financial statements, joint ventures are accounted for using the equity method.

1.3
Going concern
1.4
Turnover

The turnover shown in the profit and loss account represents the value of all services delivered during the year, at selling price exclusive of Value Added Tax.

 

The majority of legal services work is undertaken on a no win no fee basis and so profit costs are recognised at the point at which the company has fulfilled its contractual obligations to the client and the fee income is virtually certain to be received. This is considered to be when liability is admitted in the case.

 

Amounts recoverable on contracts, being unbilled work completed included in debtors, are calculated by reference to the case. The majority of work is undertaken on a no win no fee basis. Profit costs are therefore not recognised until liability has been established, except for cases covered by legal expenses insurance where the insurer has guaranteed recovery of costs.

 

Vehicle leasing is recognised at the fair value of the consideration received or receivable for charges for car hire provided in the normal course of business in the year, 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.

 

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.5
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.6
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost , 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:

Leasehold land and buildings
10% Reducing Balance
Fixtures and fittings
20% Reducing Balance
Computers
50% Reducing Balance
Motor vehicles
25% Reducing Balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.7
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -

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

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

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

1.8
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

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.

1.9
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.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.10
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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.

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 group 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 group after deducting all of its liabilities.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -

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 though 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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.11
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

1.12
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
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 if, and only if, there is 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.

1.13
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.

1.14
Retirement benefits

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

1.15
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to the profit and loss account so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed.

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the director is 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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Bad debt provision

Due to the nature of the Group's services there is inherent uncertainty regarding the timing of the receipt of cash in respect of amounts billed for both legal services and vehicle hire income. This is because cases can be ongoing over a long period and payment is generally received only once the case is settled.

 

Management review receivables included on the balance sheet regularly and use their knowledge of the business and the industry as a whole to make reasonable judgements on whether old receivable balances are considered to be recoverable.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Amounts recoverable on contracts

In determining the carrying value of amounts recoverable on contracts, being work completed on legal cases which have not yet been billed, management apply a percentage recoverability rate to the value of chargeable time carried on cases. This percentage is 65% as at 31 December 2023 and has been calculated to take into account a number of factors, including age of the work completed, the likelihood of winning a case and the recoverability of fees on cases which are eventually settled in the client's favour.

3
Turnover and other revenue

An analysis of the group's turnover is as follows:

2023
2022
£
£
Turnover
Legal services
2,694,091
2,538,591
Vehicle leasing
4,857,944
4,704,228
7,552,035
7,242,819
Other significant revenue
Interest income
49,780
5,909
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Depreciation of owned tangible fixed assets
99,777
153,255
Profit on disposal of tangible fixed assets
(90,374)
(18,664)
Amortisation of intangible assets
238,188
238,188
Operating lease charges
73,188
79,867
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
8,500
-
Audit of the financial statements of the company's subsidiaries
8,500
-
17,000
-
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Fee earners, administrative and directors
54
57
35
38

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
1,923,463
1,823,110
1,195,671
1,200,125
Social security costs
186,076
175,694
119,604
118,631
Pension costs
47,905
43,843
30,504
30,827
2,157,444
2,042,647
1,345,779
1,349,583
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
7
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
100,000
141,667
8
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
47,905
43,843

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

9
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
28,686
5,909
Interest receivable from group companies
21,094
-
0
Total income
49,780
5,909

Investment income includes the following:

Interest on financial assets not measured at fair value through profit or loss
28,686
5,909
10
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
50,141
55,805
Interest on finance leases and hire purchase contracts
24,026
25,499
Interest on invoice finance arrangements
192,656
134,929
Interest on other loans
189,157
92,130
455,980
308,363
Other finance costs:
Other interest
20,435
10,416
Total finance costs
476,415
318,779
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
11
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
129,891
19,489
Adjustments in respect of prior periods
-
0
(23,357)
Total current tax
129,891
(3,868)
Deferred tax
Origination and reversal of timing differences
(594)
(3,758)
Total tax charge/(credit)
129,297
(7,626)

The actual charge for the year can be reconciled to the expected charge based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit/(loss) before taxation
358,992
(166,243)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
84,435
(31,586)
Tax effect of expenses that are not deductible in determining taxable profit
34,945
44,352
Unutilised tax losses carried forward
-
0
(28,731)
Deferred tax adjustments in respect of prior years
811
-
0
Tax at marginal rate
(477)
-
0
Depreciation
23,468
29,118
Capital allowances
(12,480)
(17,021)
Deferred tax movement
(1,405)
(3,758)
Taxation charge/(credit) for the year
129,297
(7,626)
12
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 January 2023 and 31 December 2023
3,156,881
Amortisation and impairment
At 1 January 2023
2,664,780
Amortisation charged for the year
238,188
At 31 December 2023
2,902,968
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
12
Intangible fixed assets
(Continued)
- 26 -
Carrying amount
At 31 December 2023
253,913
At 31 December 2022
492,101
Company
Goodwill
£
Cost
At 1 January 2023 and 31 December 2023
3,100,000
Amortisation and impairment
At 1 January 2023
2,635,000
Amortisation charged for the year
232,500
At 31 December 2023
2,867,500
Carrying amount
At 31 December 2023
232,500
At 31 December 2022
465,000
13
Tangible fixed assets
Group
Leasehold land and buildings
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
40,448
218,180
132,178
517,229
908,035
Additions
-
0
4,573
2,280
-
0
6,853
Disposals
-
0
-
0
-
0
(81,250)
(81,250)
At 31 December 2023
40,448
222,753
134,458
435,979
833,638
Depreciation and impairment
At 1 January 2023
20,420
182,074
99,405
190,903
492,802
Depreciation charged in the year
5,552
10,799
12,314
71,112
99,777
Eliminated in respect of disposals
-
0
-
0
-
0
(54,390)
(54,390)
At 31 December 2023
25,972
192,873
111,719
207,625
538,189
Carrying amount
At 31 December 2023
14,476
29,880
22,739
228,354
295,449
At 31 December 2022
20,028
36,106
32,773
326,326
415,233
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Tangible fixed assets
(Continued)
- 27 -
Company
Leasehold land and buildings
Fixtures and fittings
Computers
Total
£
£
£
£
Cost
At 1 January 2023
40,448
174,189
91,665
306,302
Additions
-
0
2,922
-
0
2,922
At 31 December 2023
40,448
177,111
91,665
309,224
Depreciation and impairment
At 1 January 2023
20,420
152,756
66,732
239,908
Depreciation charged in the year
5,552
8,369
8,000
21,921
At 31 December 2023
25,972
161,125
74,732
261,829
Carrying amount
At 31 December 2023
14,476
15,986
16,933
47,395
At 31 December 2022
20,028
21,433
24,933
66,394
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
270,013
270,013
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 January 2023 and 31 December 2023
270,013
Carrying amount
At 31 December 2023
270,013
At 31 December 2022
270,013
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
15
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered
Nature of business
Class of
% Held
office
shares held
Direct
Indirect
Access Hire & Finance Ltd
England & Wales
Vehicle hire services
Ordinary A
54.17
0
16
Financial instruments
Group
Company
2023
2022
2023
2022
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
6,668,181
5,746,885
2,023,237
1,730,056
Carrying amount of financial liabilities
Measured at amortised cost
5,723,827
5,353,032
2,435,747
2,227,069
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
5,089,354
4,469,912
924,368
924,825
amounts recoverable on contracts
1,901,940
1,850,013
1,901,940
1,850,013
Corporation tax recoverable
13,825
-
0
13,825
-
0
Amounts due from group undertakings
-
-
233,592
230,944
Other debtors
943,779
702,719
865,277
574,287
Prepayments and accrued income
1,211,725
1,042,756
188,867
162,809
9,160,623
8,065,400
4,127,869
3,742,878
Amounts falling due after more than one year:
Deferred tax asset (note 22)
105,816
107,016
-
0
-
0
Total debtors
9,266,439
8,172,416
4,127,869
3,742,878
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 29 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank overdrafts
20
789,917
1,210,835
789,917
1,132,860
Obligations under finance leases
21
49,684
123,665
-
0
-
0
Bank loans
20
737,264
568,072
737,264
568,072
Trade creditors
437,480
143,577
67,137
47,546
Corporation tax payable
142,262
45,611
7,913
13,842
Other taxation and social security
1,181,022
1,011,849
196,485
132,666
Dividends payable
12,500
-
0
-
0
-
0
Other creditors
2,467,894
2,001,400
34,618
28,752
Accruals and deferred income
293,990
627,839
101,893
50,054
6,112,013
5,732,848
1,935,227
1,973,792
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
21
230,180
277,859
-
0
-
0
Bank loans
20
704,918
399,785
704,918
399,785
935,098
677,644
704,918
399,785
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank overdrafts
789,917
1,210,835
789,917
1,132,860
Bank loans
1,442,182
967,857
1,442,182
967,857
2,232,099
2,178,692
2,232,099
2,100,717
Payable within one year
1,527,181
1,778,907
1,527,181
1,700,932
Payable after one year
704,918
399,785
704,918
399,785

The bank overdrafts of £789,917 (2022: £1,210,835) and loans of £1,442,182 (2022: £967,857) are secured by a debenture creating a fixed and floating charge over the assets of the group dated 25 September 2015.

 

 

 

SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
21
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
49,684
123,665
-
0
-
0
In two to five years
230,180
277,859
-
0
-
0
279,864
401,524
-
-

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is less than one year. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

 

The obligations under finance leases are secured against the relevant tangible fixed assets to which the agreements relate.

22
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Group
£
£
£
£
Accelerated capital allowances
8,949
10,743
105,816
107,016
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Company
£
£
£
£
Accelerated capital allowances
8,949
10,743
-
-
Group
Company
2023
2023
Movements in the year:
£
£
Liability/(asset) at 1 January 2023
(96,273)
10,743
Credit to profit or loss
(594)
(1,794)
Liability/(asset) at 31 December 2023
(96,867)
8,949
SHELDON DAVIDSON SOLICITORS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 31 -
23
Share capital
Group and company
2023
2022
Ordinary share capital
£
£
Issued and fully paid
1,100,001 Ordinary shares of £1 each
1,100,001
1,100,001
24
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
544,255
436,641
48,485
43,143
Between two and five years
451,289
1,668
83,637
1,668
995,544
438,309
132,122
44,811
25
Related party transactions

Included in creditors is an amount owed to the director of £9,036 (2022: £1,961). This loan is provided interest free, unsecured and repayable on demand.

 

26
Cash generated from group operations
2023
2022
£
£
Profit/(loss) for the year after tax
229,694
(158,617)
Adjustments for:
Taxation charged/(credited)
129,297
(7,626)
Finance costs
476,415
318,779
Investment income
(49,780)
(5,909)
Gain on disposal of tangible fixed assets
(90,374)
(18,664)
Amortisation and impairment of intangible assets
238,188
238,188
Depreciation and impairment of tangible fixed assets
99,777
153,255
Movements in working capital:
(Increase)/decrease in debtors
(1,093,959)
67,366
Increase/(decrease) in creditors
595,721
(105,662)
Cash generated from operations
534,979
481,110
2023-12-312023-01-01falseCCH SoftwareCCH Accounts Production 2024.210Mr Sheldon DavidsonMr S 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