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Registered number: 12872639









Back 2 Work Group Limited









Annual Report and Financial Statements

For the Year Ended 31 July 2024

 
Back 2 Work Group Limited
 
 
Company Information


Directors
L A Muscat-Terribile 
A P Bailey 
J E Gregson 
T Lewis 
J Painter 




Registered number
12872639



Registered office
Building 4
Universal Square

Devonshire Street

Manchester

M12 6JH




Independent auditors
Hurst Accountants Limited
Chartered Accountants & Statutory Auditors

3 Stockport Exchange

Stockport

Cheshire

SK1 3GG





 
Back 2 Work Group Limited
 

Contents



Page
Group Strategic Report
 
1 - 4
Directors' Report
 
5 - 6
Independent Auditors' Report
 
7 - 10
Consolidated Statement of Comprehensive Income
 
11
Consolidated Balance Sheet
 
12
Company Balance Sheet
 
13
Consolidated Statement of Changes in Equity
 
14
Company Statement of Changes in Equity
 
15
Consolidated Statement of Cash Flows
 
16 - 17
Consolidated Analysis of Net Debt
 
18
Notes to the Financial Statements
 
19 - 42


 
Back 2 Work Group Limited
 
 
Group Strategic Report
For the Year Ended 31 July 2024

Introduction
 
The directors present their strategic report together with the audited financial statements for the year ended 31 July 2024.

Business review
 
The principal activities of the Group during the year continues to be the delivery of training programmes predominately for adult learners, with some training being provided to 16-18 year olds through apprenticeships.

The educational provisions include:
 
Pre-Employment training 
Upskill programmes to those in work
Apprenticeships
Bootcamps
Commercial

Back 2 Work Group Limited continues to focus on the quality of teaching and support, enabling individuals to gain skills and confidence they need to apply for jobs, secure employment, or upskill within their current role. With new UKSPF contracts adding to our upskill programmes.

Just IT Limited continues to deliver digital training in both apprenticeships and bootcamps, with results for the year including a new AEB contract which is enabling the entity to offer a level 2 entry point for learners to start their digital skills journey. 

During the year the Group completed 2 further acquisitions, Bespoke Professional Development and Training Ltd and Greendale Ltd (trading as ECTA). These acquisitions have provided entry into the HR and Green training sector, significantly increasing our apprenticeship occupancy, customer base and bootcamp contracts.

The Group receives government funding from the Education and Skills Funding Agency (ESFA), the Adult Education Budget (AEB) from devolved combined authorities, and a small amount of sub-contracted AEB funding from Further Education colleges and UK shared prosperity fund (UKSPF).

Just IT Limited, Bespoke Professional Development and Training Ltd and Greendale Ltd all have corporate revenue, with corporate clients for training courses and Just IT only recruitment services.
The Group’s results for the year include accrued but unpaid loan note interest of £1,840,150 which is held within subsidiary, Back 2 Work Holdings Limited. This interest relates to loan notes issued as part of the acquisition of Just IT Training Limited. The loan notes remain outstanding as at 31 July 2024, and the associated interest continues to accrue in line with the agreed terms. This has impacted the Group’s reported finance costs for the year, and overall loss for the year of £3,681,856.

Page 1

 
Back 2 Work Group Limited
 

Group Strategic Report (continued)
For the Year Ended 31 July 2024

Principal risks and uncertainties
 

The majority of revenue is through funding from the government via ESFA or AEB devolved budgets. Changes to government funding priorities therefore remains the primary risk faced by the Group. As we outlined last year, we are aware of the upcoming elections, and mindful of potential changes. As far as possible we have taken advice on likely policy changes to help us plan through different scenarios. We believe we are well placed to react quickly to any changes due to our experienced management team, structures, and stakeholder relationships.
The Group continues to have significant success in recent retenders, and in new funding opportunities during the year, which has put us in a strong position as we enter the next financial year.
The principal financial instruments used by the Group are cash, trade debtors and trade creditors. The management of these instruments provides finance for the Group’s operations.
The main risks arising from the Group’s financial instruments are price risk, credit risk, liquidity risk and interest rate risk. The directors review and agree policies for managing these risks as outlined below:
Price risk
The Group closely monitors changes to price across its operation and reacts appropriately and on a timely basis where appropriate.
Credit risk
The Group’s principal financial assets are cash and debtors. The directors review the debtor position regularly and ensure compliance with funding rules to mitigate risk. Given the nature of our customers and their credit worthiness, the risk of bad debt is considered to be low.
Liquidity risk
The Group manages cash closely with regular review of actual and forecast cashflows monthly, supplemented by weekly cash reporting, ensuring liquidity available to meet needs. 

Financial key performance indicators
The Group uses a number of financial key performance indicators to monitor business performance:
 

Year ended
Year ended

31 July 2024
31 July 2024
Turnover
27,419,589
26,799,795
Gross margin %
27%
31%
Adjusted EBITDA
2,822,956
3,538,910
Adjusted EBITDA %
10%
13%
Cash in bank & in hand
2,530,464
1,932,240

*Adjusted EBITDA excludes one-off costs relating to set up costs for new contracts and departments.
 
Page 2

 
Back 2 Work Group Limited
 

Group Strategic Report (continued)
For the Year Ended 31 July 2024

Directors' statement of compliance with duty to promote the success of the Group
 
The desirability of the Group maintaining a reputation for high standards of business conduct
Delivering high standards of business conduct and maintaining a positive reputation with our commissioners, stakeholders and service users is fundamental to the success of our business. When making decisions, the directors consider the insights obtained through engagement activities with these groups and best industry practice and are cognisant of the importance of maintaining our reputation for high standards of business conduct. The directors provide the systems, processes, and people to ensure our conduct is driven by our values across the whole organisation, and that all employees understand the part they play in this ambition. This is underpinned by clear group policies, performance reviews, staff training and regular board communications.
Primary board focus and decision making during the year
Core focus and strategy in the year has been different within the Group. 
The Group board has been heavily involved in the acquisition and onboarding of the 2 acquisitions, completing significant due diligence ahead of each acquisition. The acquisitions have provided access to new training sectors and customer base. The key focus will be fully integrating these companies quickly into the group, growing the core businesses and where appropriate providing our customers a more comprehensive training solution.
As we reported last year Back to Work Complete Training's focus has been adjusting its curriculum and delivery for the changing funding rules. The impact of these changes proved extremely challenging as we navigated through FY24. Ensuring the right learners were engaged onto longer courses to avoid high non achievers number- lead to a complete revisit of our IAG and onboarding process. Whilst also reviewing all teams within the business to make processes more efficient to mitigate the rising costs of delivery. Alongside this Back to work also had to mobilisation a significant AEB contract, 2 UK SPF contracts, taking both significant planning and costs to mobilise.
Whilst quality continues to be a core commitment within Just IT, new processes and teams have now embedded the group standards into everyday activities and reporting. Allowing the focus in the year to be the setup of the new AEB provision and the delivery of the growing bootcamp provision. The entity has seen the benefits of the strong management team that was put in place in the prior year, they continue to improve the delivery models and key metrics across the provisions.
 
The board continues to look for further acquisition opportunities that would both complement existing provisions or deliver sector training within growth sectors that we currently do not provide. All potential targets are appraised on numerous factors, primarily being quality, potential growth opportunities, cross group opportunities and financial strength.
The need to foster the Group's business relationships with suppliers, customers and others
The Group is committed to fostering good business relationships with suppliers, customers and other stakeholders which are fundamental to our business model. The business is operated in an ethical and responsible way with high standards of business conduct, driven by the senior management team. There are processes and policies in place to ensure that all our customers are treated fairly, and with care and respect. In relation to suppliers, the Group procurement and outsourcing policies ensure that any tender processes are fair and transparent, and suppliers receive constructive feedback. The Group has been in frequent communication with both suppliers and customers throughout the year ensuring any potential issues are identified early and managed effectively.
Staff wellbeing and engagement 
The Group is a “mission driven” organisation guided by a strong set of established values. Through ongoing communication and monthly business updates the full workforce is kept informed of business performance, market conditions and strategic direction as determined by Senior Leadership. The Group prides itself on a robust wellbeing and support offer for its workforce including trained mental health champions, access to funded counselling and medical support, HR policies supporting flexible working and a general positive approach to engaging with staff regarding any challenges they face, work related or not.

Page 3

 
Back 2 Work Group Limited
 

Group Strategic Report (continued)
For the Year Ended 31 July 2024

Group non-financial and sustainability information statement
 
The Group recognises its impact on communities in which we operate, and regularly engages with employers, local government, community groups, representative bodies and individuals across England to deliver government funded education, training and employment support to residents who have the need to increase their knowledge and skills or require support to access employment. We gain their feedback through formal and informal processes and use this insight to evolve and improve our services to futureproof our provision. The Group recognises the need to consider the environmental impact of our operations, and we review our delivery regularly to ensure we minimise our impact and positively deliver against our carbon reduction plan. As well as corporate level initiatives, staff training ensures environmental impact is considered in our everyday decision making and service design.


This report was approved by the board and signed on its behalf.



L A Muscat-Terribile
Director
Date: 26 February 2025

Page 4

 
Back 2 Work Group Limited
 
 
 
Directors' Report
For the Year Ended 31 July 2024

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

Directors' responsibilities statement

The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The loss for the year, after taxation, amounted to £3,681,856 (2023 -loss £2,171,555).

No dividends have been recommended for payment in the financial year.

Directors

The directors who served during the year were:

L A Muscat-Terribile 
A P Bailey 
J E Gregson 
T Lewis 
J Painter 

Future developments

The Group maintains a robust financial position and with the support of Palatine Private Equity LLP,  will continue to deliver government funded education and training programmes to both unemployed and in-work learners.

Engagement with employees

The directors have chosen to set out disclosures relating to engagement with employees in the strategic report.

Page 5

 
Back 2 Work Group Limited
 
 
 
Directors' Report (continued)
For the Year Ended 31 July 2024

Matters covered in the Group Strategic Report

The directors have chosen to set out the disclosures relating to financial risk objectives & policies and information on exposure to price risk, credit risk, liquidity risk, and cash flow risk in the strategic report.

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the company since the year end.

Auditors

The auditorsHurst Accountants Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





L A Muscat-Terribile
Director

Date: 26 February 2025

Page 6

 
Back 2 Work Group Limited
 
 
 
Independent Auditors' Report to the Members of Back 2 Work Group Limited
 

Opinion


We have audited the financial statements of Back 2 Work Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 July 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 Group's and of the parent Company's affairs as at 31 July 2024 and of the Group's loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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 Group's or the parent 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.


Page 7

 
Back 2 Work Group Limited
 
 
 
Independent Auditors' Report to the Members of Back 2 Work Group Limited (continued)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters 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 Group Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Group Strategic Report and the 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 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 Group Strategic Report or the Directors' Report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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 Directors' Responsibilities Statement set out on page 5, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 8

 
Back 2 Work Group Limited
 
 
 
Independent Auditors' Report to the Members of Back 2 Work Group Limited (continued)


Auditors' 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 Auditors' 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 Group 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:

Identifying and assessing potential risks related to irregularities
 
In identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:
 
The nature of the industry and sector in which the company operates; the control environment and business performance including key drivers for directors' remuneration, bonus levels and performance targets.
The outcome of enquiries of local management and parent company management, including whether management was aware of any instances of non-compliance with laws and regulations, and whether management had knowledge of any actual, suspected, or alleged fraud.
Supporting documentation relating to the Company's policy and procedures for:
°Identifying, evaluating, and complying with laws and regulations,
°Detecting and responding to the risks of fraud.
The internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.
The outcome of discussion amongst the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
The legal and regulatory framework in which the Company operates, particularly those laws and regulations which have a direct effect on the financial statements, such as the Companies Act 2006, pensions and tax legislation, or which had a fundamental effect on the operations of the Company, including General Data Protection requirements, and Antibribery and Corruption, compliance with Education and Skills Funding Agency "ESFA" and Adult Education Budget "AEB" funding regulations.
 
Audit response to risks identified
 
Our procedures to respond to the risks identified included the following: 
 
Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with the provisions of those relevant laws and regulations which have a direct effect on the financial statements.
Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud.
Evaluation and testing of the operating effectiveness of management's controls designed to prevent and detect irregularities.
Enquiring of management about any actual and potential litigation and claims.
Performing analytical procedures to identify any unusual or unexpected relationships which may indicate risks of material misstatement due to fraud.
 
Page 9

 
Back 2 Work Group Limited
 
 
 
Independent Auditors' Report to the Members of Back 2 Work Group Limited (continued)


We have also considered the risk of fraud through management override of controls by:
 
Testing the appropriateness of journal entries and other adjustments. We have used data analytics to identify accounting transactions which may pose a heightened risk of material misstatement, whether due to fraud or error.
Challenging assumptions made by management in their significant accounting estimates, and 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 non-compliance with laws and regulations throughout the audit.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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


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 2006Our 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 Auditors' 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.





Helen Besant-Roberts (Senior Statutory Auditor)
for and on behalf of
Hurst Accountants Limited
Chartered Accountants
Statutory Auditors
3 Stockport Exchange
Stockport
Cheshire
SK1 3GG

26 February 2025
Page 10

 
Back 2 Work Group Limited
 
 
Consolidated Statement of Comprehensive Income
For the Year Ended 31 July 2024

2024
2023
Note
£
£

  

Turnover
 4 
27,419,589
26,799,795

Cost of sales
  
(20,016,117)
(18,622,055)

Gross profit
  
7,403,472
8,177,740

Administrative expenses
  
(8,648,583)
(7,851,348)

Other operating income
 5 
20,733
-

Operating (loss)/profit
 6 
(1,224,378)
326,392

Interest receivable and similar income
 10 
3,058
-

Interest payable and similar expenses
 11 
(2,272,857)
(1,964,100)

Loss before taxation
  
(3,494,177)
(1,637,708)

Tax on loss
 12 
(187,679)
(533,847)

Loss for the financial year
  
(3,681,856)
(2,171,555)

Loss for the year attributable to:
  

Owners of the parent Company
  
(3,681,856)
(2,171,555)

There were no recognised gains and losses for 2024 or 2023 other than those included in the consolidated statement of comprehensive income.

There was no other comprehensive income for 2024 (2023:£NIL).

The notes on pages 19 to 42 form part of these financial statements.

Page 11

 
Back 2 Work Group Limited
Registered number: 12872639

Consolidated Balance Sheet
As at 31 July 2024

2024
2023
Note
£
£

Fixed assets
  

Intangible assets
 13 
18,303,900
17,527,127

Tangible assets
 14 
910,806
265,756

  
19,214,706
17,792,883

Current assets
  

Stocks
 16 
2,949
2,949

Debtors: amounts falling due after more than one year
 17 
47,111
42,959

Debtors: amounts falling due within one year
 17 
5,246,012
4,933,129

Cash at bank and in hand
 18 
2,530,464
1,932,240

  
7,826,536
6,911,277

Creditors: amounts falling due within one year
 19 
(6,117,116)
(4,849,262)

Net current assets
  
 
 
1,709,420
 
 
2,062,015

Total assets less current liabilities
  
20,924,126
19,854,898

Creditors: amounts falling due after more than one year
 20 
(30,529,085)
(25,783,935)

Provisions for liabilities
  

Deferred taxation
 22 
(54,063)
(48,129)

Net liabilities
  
(9,659,022)
(5,977,166)


Capital and reserves
  

Called up share capital 
 23 
1,112
1,112

Share premium account
 24 
124,598
124,598

Capital redemption reserve
 24 
10
10

Profit and loss account
 24 
(9,784,742)
(6,102,886)

  
(9,659,022)
(5,977,166)


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


L A Muscat-Terribile
Director
 
Date: 
26 February 2025

The notes on pages 19 to 42 form part of these financial statements.

Page 12

 
Back 2 Work Group Limited
Registered number: 12872639

Company Balance Sheet
As at 31 July 2024

2024
2023
Note
£
£

Fixed assets
  

Investments
 15 
43,979
43,979

Current assets
  

Debtors: amounts falling due within one year
 17 
81,620
81,394

Creditors: amounts falling due within one year
 19 
(13,486)
(8,686)

Net current assets
  
 
 
68,134
 
 
72,708

Total assets less current liabilities
  
112,113
116,687

  

  

Net assets
  
112,113
116,687


Capital and reserves
  

Called up share capital 
 23 
1,112
1,112

Share premium account
 24 
124,598
124,598

Capital redemption reserve
 24 
10
10

Profit and loss account brought forward
  
(9,033)
(5,022)

Loss for the year
  
(4,574)
(4,011)

Profit and loss account carried forward
  
(13,607)
(9,033)

  
112,113
116,687


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


L A Muscat-Terribile
Director

Date: 26 February 2025

The notes on pages 19 to 42 form part of these financial statements.

Page 13

 
Back 2 Work Group Limited
 

Consolidated Statement of Changes in Equity
For the Year Ended 31 July 2024


Called up share capital
Share premium account
Capital redemption reserve
Profit and loss account
Total equity

£
£
£
£
£


At 1 August 2022
1,020
117,375
-
(3,931,331)
(3,812,936)


Comprehensive income for the year

Loss for the year
-
-
-
(2,171,555)
(2,171,555)


Contributions by and distributions to owners

Purchase of own shares
-
-
10
-
10

Shares issued during the year
102
7,223
-
-
7,325

Shares cancelled during the year
(10)
-
-
-
(10)


Total transactions with owners
92
7,223
10
-
7,325



At 1 August 2023
1,112
124,598
10
(6,102,886)
(5,977,166)


Comprehensive income for the year

Loss for the year
-
-
-
(3,681,856)
(3,681,856)


Total transactions with owners
-
-
-
-
-


At 31 July 2024
1,112
124,598
10
(9,784,742)
(9,659,022)


The notes on pages 19 to 42 form part of these financial statements.

Page 14

 
Back 2 Work Group Limited
 

Company Statement of Changes in Equity
For the Year Ended 31 July 2024


Called up share capital
Share premium account
Capital redemption reserve
Profit and loss account
Total equity

£
£
£
£
£


At 1 August 2022
1,020
117,375
-
(5,022)
113,373


Comprehensive income for the year

Loss for the year
-
-
-
(4,011)
(4,011)


Contributions by and distributions to owners

Purchase of own shares
-
-
10
-
10

Shares issued during the year
102
7,223
-
-
7,325

Shares cancelled during the year
(10)
-
-
-
(10)


Total transactions with owners
92
7,223
10
-
7,325



At 1 August 2023
1,112
124,598
10
(9,033)
116,687


Comprehensive income for the year

Loss for the year
-
-
-
(4,574)
(4,574)


At 31 July 2024
1,112
124,598
10
(13,607)
112,113


The notes on pages 19 to 42 form part of these financial statements.

Page 15

 
Back 2 Work Group Limited
 

Consolidated Statement of Cash Flows
For the Year Ended 31 July 2024

2024
2023
£
£

Cash flows from operating activities

Loss for the financial year
(3,681,856)
(2,171,555)

Adjustments for:

Amortisation of intangible assets
2,456,070
2,284,589

Depreciation of tangible assets
158,845
118,176

Loss on disposal of tangible assets
(58)
-

Government grants
(20,733)
-

Interest payable
2,272,857
1,964,099

Interest receivable
(3,058)
-

Taxation charge
187,679
533,847

Decrease in stocks
-
738

Increase in debtors
(261,051)
(775,013)

Increase in creditors
3,464,058
1,285,723

Decrease in provisions
-
(3,437,739)

Corporation tax (paid)
(350,018)
(520,485)

Net cash generated (used in)/from operating activities

4,222,735
(717,620)


Cash flows from investing activities

Purchase of intangible fixed assets
-
(150,995)

Purchase of tangible fixed assets
(233,902)
(118,991)

Sale of tangible fixed assets
59,201
-

Government grants received
20,733
-

Purchase of fixed asset investments
(4,643,357)
-

Interest received
3,058
-

Cash acquired with subsidiary
887,613
-

Net cash used in investing activities

(3,906,654)
(269,986)

Cash flows from financing activities

Issue of ordinary shares
-
7,325

New secured loans
6,865,000
2,500,000

Repayment of loans
(4,310,000)
(645,000)

Repayment of debenture loans
-
(6,175)

Interest paid
(2,272,857)
(1,964,099)

Net cash generated from financing activities

282,143
(107,949)

Net increase/(decrease) in cash and cash equivalents
598,224
(1,095,555)

Cash and cash equivalents at beginning of year
1,932,240
3,027,795

Cash and cash equivalents at the end of year
2,530,464
1,932,240

Page 16

 
Back 2 Work Group Limited
 

Consolidated Statement of Cash Flows (continued)
For the Year Ended 31 July 2024


2024
2023

£
£


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
2,530,464
1,932,240


The notes on pages 19 to 42 form part of these financial statements.

Page 17

 
Back 2 Work Group Limited
 

Consolidated Analysis of Net Debt
For the Year Ended 31 July 2024





At 1 August 2023
Cash flows
Acquisition and disposal of subsidiaries
At 31 July 2024
£

£

£

£

Cash at bank and in hand

1,932,240

4,252,238

(3,654,014)

2,530,464

Debt due after 1 year

(21,003,866)

(2,555,000)

(350,000)

(23,908,866)

Debt due within 1 year

(1,051,259)

4,367

(250,000)

(1,296,892)


(20,122,885)
1,701,605
(4,254,014)
(22,675,294)

The notes on pages 19 to 42 form part of these financial statements.

Page 18

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

1.


General information

Back 2 Work Group Limited is a private company limited by shares and incorporated in England and Wales. The address of the registered office is Building 4, Universal Square, Devonshire Street North, Manchester, M12 6JH. The company's registered number is 12872639.
The nature of the group's operation and its principal activity is to provide pre and post-employment training throughout the UK.
The consolidated financial statements of Back 2 Work Group Limited as at and for the year ended 31 July 2024 comprise the financial statements of Back 2 Work Group Limited and its subsidiaries (together referred to as "the Group"). These subsidiaries are disclosed in the fixed asset investments note of these accounts.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Page 19

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

2.Accounting policies (continued)

 
2.3

Going concern

The directors have presented the financial statements on a going concern basis which assumes the company
and group will have sufficient resources to meet liabilities as they fall due.
During the year ended 31 July 2024, the group reported a loss of £3,681,856 (
2023: loss of £2,171,555)
due to loan note interest that has been accrued and not paid. At 31 July 2024, the group had net current
assets of £1,709,420 (
2023: £2,062,015) and net liabilities totalled £9,659,022 (2023:
£5,977,166
).
The directors have prepared profit and cash flow forecasts covering 12 months from the date of signing the
financial statements and believe that the assumptions underlying their forecasts are reasonable. These forecasts indicate that the company and group will have sufficient cash to enable them to discharge their liabilities as and when they fall due.
This assessment is supported by profit and loss and cash flow forecasts of the trading subsidiaries prepared by
management. The financial statements have therefore been prepared on a going concern basis.

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. 
Rendering of services
Revenue from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. Revenue is only recognised to the extent of recoverable expenses when the outcome of the contract cannot be estimated reliably.

 
2.5

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Government grants

Grants of a revenue nature are recognised in the Consolidated Statement of Comprehensive Income in the same period as the related expenditure.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

Page 20

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

2.Accounting policies (continued)

 
2.8

Finance costs

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

 
2.9

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

 
2.10

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

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

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Page 21

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

2.Accounting policies (continued)

 
2.11

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life. Goodwill is being amortised of over a period of 5-10 years.

Other intangible assets

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

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

 
2.12

Tangible fixed assets

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

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Short-term leasehold property
-
straight line over the lease period
Plant and machinery
-
20%
straight line
Motor vehicles
-
20%
straight line
Fixtures and fittings
-
25%
straight line
Office equipment
-
33%
straight line
Computer equipment
-
33%
straight line

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

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

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Page 22

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

2.Accounting policies (continued)

 
2.14

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is 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.

 
2.15

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Amounts recoverable on contracts is valued by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs.

 
2.16

Cash

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.

In the Consolidated Statement of Cash Flows, cash is shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.17

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.18

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.19

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” 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.


 
Page 23

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

2.Accounting policies (continued)


2.19
Financial instruments (continued)

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date. 
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Group after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
 

Page 24

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

2.Accounting policies (continued)


2.19
Financial instruments (continued)

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

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


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

Preparation of the financial statements requires management to make significant judgements and estimates that affect amounts recognised for assets and liabilities at the reporting date and the amounts of revenue and expenses incurred during the reporting period. Actual outcomes may differ from these judgements, estimates and assumptions. The judgements, estimates and assumptions that have the most significant effect on the carrying value of assets and liabilities of the Group as at 31 July 2024 are discussed below:
Revenue recognition and work in progress
The management of the Group exercise significant judgement in making an assessment of the stage of completion of a contract at the year-end and the appropriate amount of revenue and attributable profit to recognise. The Group has recognised amounts recoverable on contract with a carrying value of £3,606,334 (2023: £4,059,558) and deferred income with a carrying value of £200,817 (2023: £279,429).
Goodwill
Goodwill acquired on business combinations is capitalised on the balance sheet and amortised over its expected useful economic life or ten years, whichever is shorter. At year end, the carrying value of goodwill was £18,303,900 (2023: £17,527,127).
Should these estimates vary, the profit or loss and balance sheet of the following years could be significantly impacted.
There are no other significant estimates or judgements.

Page 25

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

4.


Turnover

An analysis of turnover by class of business is as follows:


2024
2023
£
£

Provision of pre-employment training
27,419,589
26,799,795


All turnover arose within the United Kingdom.


5.


Other operating income

2024
2023
£
£

Government grants receivable
20,733
-


Government grants receivable relate to the Teacher Mentoring Scheme.


6.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

2024
2023
£
£

Other operating lease rentals
445,221
428,602


7.


Auditors' remuneration

During the year, the Group obtained the following services from the Company's auditors:


2024
2023
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
2,550
1,950

Fees payable to the Group's auditor and its associates for the audit of the Group's annual financial statements

Fees payable to the Group's auditor and its associates for the audit of the Group's annual financial statements
27,650
20,900

Fees payable to the Group's auditor and its associates for taxation compliance services
5,150
4,745

Page 26

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

8.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
Group
2024
2023
£
£


Wages and salaries
14,074,715
12,196,061

Social security costs
1,496,469
1,339,752

Cost of defined contribution scheme
277,427
238,766

15,848,611
13,774,579


The average monthly number of employees, including the directors, during the year was as follows:


        2024
        2023
            No.
            No.







Management
11
7



Delivery
227
235



Support
185
100

423
342

The Company has no employees other than the directors, who did not receive any remuneration (2023 -£NIL)

9.


Directors' remuneration

2024
2023
£
£

Directors' emoluments
131,666
120,000

Group contributions to defined contribution pension schemes
1,321
1,439

132,987
121,439


During the year retirement benefits were accruing to 2 directors (2023 -2) in respect of defined contribution pension schemes.


10.


Interest receivable

2024
2023
£
£


Other interest receivable
3,058
-

Page 27

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

11.


Interest payable and similar expenses

2024
2023
£
£


Bank interest payable
432,707
123,742

Other loan interest payable
1,840,150
1,840,357

Loans from group undertakings
-
1

2,272,857
1,964,100

Page 28

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

12.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
203,735
536,095

Adjustments in respect of previous periods
(18,555)
(204)

Total current tax
185,180
535,891

Deferred tax


Origination and reversal of timing differences
2,499
(2,044)


Taxation on profit on ordinary activities
187,679
533,847

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2023 -higher than) the standard rate of corporation tax in the UK of 25% (2023 -25%). The differences are explained below:

2024
2023
£
£


Loss on ordinary activities before tax
(3,494,177)
(1,637,708)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 -25%)
(873,544)
(409,427)

Effects of:


Non-tax deductible amortisation of goodwill and impairment
591,921
571,147

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
491,101
479,991

Capital allowances in excess of depreciation
-
(101,860)

Utilisation of tax losses
-
(686)

Adjustments to tax charge in respect of prior periods
-
(204)

Other timing differences leading to an increase (decrease) in taxation
(26,490)
-

Super-deduction
3,734
(5,114)

Deferred tax not recognised
957
-

Total tax charge for the year
187,679
533,847


Factors that may affect future tax charges

There are tax losses of £497,967 available to offset future taxable profits.

Page 29

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

13.


Intangible assets

Group 





Goodwill

£



Cost


At 1 August 2023
22,959,138


Additions
3,232,843


Disposals
(69,870)



At 31 July 2024

26,122,111



Amortisation


At 1 August 2023
5,432,011


Charge for the year on owned assets
2,456,070


On disposals
(69,870)



At 31 July 2024

7,818,211



Net book value



At 31 July 2024
18,303,900



At 31 July 2023
17,527,127



Page 30

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

14.


Tangible fixed assets

Group






Freehold property
Short-term leasehold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Office equipment
Computer equipment
Total

£
£
£
£
£
£
£
£



Cost or valuation


At 1 August 2023
-
63,813
-
88,788
120,327
107,290
632,364
1,012,582


Additions
-
14,452
1,619
-
48,763
13,065
156,003
233,902


Acquisition of subsidiary
600,226
-
13
8,999
770
8,030
3,955
621,993


Disposals
-
-
-
(88,788)
-
(30,293)
-
(119,081)



At 31 July 2024

600,226
78,265
1,632
8,999
169,860
98,092
792,322
1,749,396



Depreciation


At 1 August 2023
-
63,813
-
22,197
71,559
98,103
491,154
746,826


Charge for the year on owned assets
7,619
535
189
12,983
23,456
10,454
96,466
151,702


Disposals
-
-
-
(32,555)
-
(27,383)
-
(59,938)



At 31 July 2024

7,619
64,348
189
2,625
95,015
81,174
587,620
838,590



Net book value



At 31 July 2024
592,607
13,917
1,443
6,374
74,845
16,918
204,702
910,806



At 31 July 2023
-
-
-
66,591
48,768
9,187
141,210
265,756

The Company has no tangible fixed assets.

Page 31

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

15.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 August 2023
43,979



At 31 July 2024
43,979





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Class of shares

Holding

Back 2 Work Holdings Limited
Ordinary
100%
Back 2 Work Complete Training Limited *
Ordinary
100%
Just IT Training Limited*
Ordinary
100%
Skills Team Limited**
Ordinary
100%
Bespoke Professional Development and Training Limited*
Ordinary
100%
Greendale Limited*
Ordinary
100%

* Direct subsidiary of Back 2 Work Holdings Limited.
** Direct subsidiary of Just IT Training Limited.
The registered office of all subsidiaries is Building 4, Universal Square, Devonshire Street, Manchester, M12 6JH.
The results of all subsidiaries are included in the Consolidated Financial Statements.


16.


Stocks

Group
Group
2024
2023
£
£

Exam / Training Materials
2,949
2,949


Page 32

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

17.


Debtors

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Due after more than one year

Other debtors
47,111
42,959
-
-


Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Due within one year

Trade debtors
886,861
376,044
-
-

Amounts owed by group undertakings
-
-
20,815
20,815

Other debtors
300,611
122,948
59,805
59,805

Prepayments and accrued income
452,206
374,579
1,000
774

Amounts recoverable on long term contracts
3,606,334
4,059,558
-
-

5,246,012
4,933,129
81,620
81,394



18.


Cash and cash equivalents

Group
Group
2024
2023
£
£

Cash at bank and in hand
2,530,464
1,932,240


Page 33

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

19.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Bank loans
1,020,000
1,019,570
-
-

Trade creditors
1,195,164
952,864
-
-

Amounts owed to group undertakings
-
-
13,486
8,686

Corporation tax
238,213
234,744
-
-

Other taxation and social security
759,206
594,200
-
-

Other creditors
1,286,570
586,731
-
-

Accruals and deferred income
1,617,963
1,461,153
-
-

6,117,116
4,849,262
13,486
8,686


The company refinanced both Bank Loan A and Bank Loan B in the year in order to facilitate the acquisition of
Bespoke Professional Development and Training Limited and Greendale Limited.
Loan A was refinanced in December 2023 and now totals £2,550,000 (
2023: £2,550,000), with a related interest
rate of Base Rate plus 3.5% until December 2026 (
2023: Base rate plus 3.5% until September 2025). The loan is
repaid on a quarterly basis. The loan is secured by way of a fixed and floating charge over all property or
undertaking of the company.
Loan B was refinanced in February 2024 and now totals £3,550,000 (
2023: £1,250,000), with a related interest rate
of Base Rate plus 4% until December 2026 (
2023: Base rate plus 3.5% until September 2025). It is a bullet loan,
with the capital amount due in full in December 2026 (
2023: September 2025). The loan is secured by way of a
fixed and floating charge over all property or undertaking of the company.
The company also has access to a £1,000,000 revolving overdraft as part of the refinancing. This is not in use and is
not expected to be put into use in the near future.
Amounts owed to group undertakings are interest free, unsecured and repayable on demand.
Other creditors include deferred consideration payable for the acquisitions of Bespoke Professional Development
and Training Limited and Greendale Limited during the year. As no probable contingencies exist that would prevent
payment, the full amount has been accrued within other creditors.
Page

Page 34

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

20.


Creditors: Amounts falling due after more than one year

Group
Group
2024
2023
£
£

Debentures loans
18,478,866
18,478,866

Bank loans
5,080,000
2,525,000

Other creditors
350,000
-

Accruals and deferred income
6,620,219
4,780,069

30,529,085
25,783,935


Debenture loans totalling £16,485,041 (2023: £16,485,041) are entitled to interest at 10% per annum. They are
redeemable at par along with any unpaid interest five years from the date of issue, which is 22 October 2025. The
loan notes are secured on a fixed and floating charge over all property or undertaking of the company.
Debenture loans totalling £1,993,825 (2023: £1,993,825) are entitled to interest at 10% per annum. They are
redeemable at par along with any unpaid interest five years from the date of issue, which is 8 June 2027. The loan
notes are secured on a fixed and floating charge over all property or undertaking of the company.
The company refinanced both Bank Loan A and Bank Loan B in the year in order to facilitate the acquisition of
Bespoke Professional Development and Training Limited and Greendale Limited.
The company also has access to a £1,000,000 revolving overdraft as part of the refinancing. This is not in use and is
not expected to be put into use in the near future.
Other creditors include deferred consideration payable for the acquisitions of Bespoke Professional Development
and Training Limited and Greendale Limited during the year. As no probable contingencies exist that would prevent
payment, the full amount has been accrued within other creditors.


21.


Loans


Analysis of the maturity of loans is given below:


Group
Group
2024
2023
£
£

Amounts falling due within one year

Bank loans
1,020,000
1,019,570

Amounts falling due 1-2 years

Bank loans
1,020,000
1,020,000

Debenture loans
16,485,041
-

Amounts falling due 2-5 years

Bank loans
4,060,000
1,505,000

Debenture loans
1,993,825
18,478,866


24,578,866
22,023,436


Page 35

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

22.


Deferred taxation


Group



2024
2023


£

£






At beginning of year
(48,129)
(50,173)


Charged to profit or loss
(2,499)
2,044


Arising on business combinations
(3,435)
-



At end of year
(54,063)
(48,129)

Company





The provision for deferred taxation is made up as follows:

Group
Group
2024
2023
£
£

Accelerated capital allowances
(74,062)
(66,660)

Pension surplus
19,999
18,531

(54,063)
(48,129)

Page 36

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

23.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



49,154 (2023 -49,154) Ordinary A shares of £0.01 each
492
492
1,000 (2023 -1,000) Ordinary A1 shares of £0.01 each
10
10
30,425 (2023 -30,425) Ordinary B1 shares of £0.01 each
304
304
16,596 (2023 -16,596) Ordinary B2 shares of £0.01 each
166
166
9,000 (2023 -9,000) Ordinary C shares of £0.01 each
90
90
2,000 (2023 -2,000) Ordinary D1 shares of £0.01 each
20
20
2,000 (2023 -2,000) Ordinary D2 shares of £0.01 each
20
20
1,000 (2022 - NIL1,000) Ordinary D3 shares of £0.01 each
10
10

1,112

1,112



24.


Reserves

Share premium account

The share premium account is an equity account that represents the additional amount shareholders paid for the issued shares that were in excess of the par value.

Capital redemption reserve

The capital redemption reserve represents the nominal value of shares that have been purchased by the company and cancelled. The reserve is non-distributable and can only be used for limited purposes as set out in the Companies Act 2006.

Profit and loss account

The profit and loss account includes all current retained profits and losses.

Page 37

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

25.
 

Business combinations

On 20 December 2023, 100% of the share capital of Bespoke Professional Training and Development Limited was acquired by the Group.

Acquisition of Bespoke Professional Training and Development Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
8,030
(3,842)
4,188

8,030
(3,842)
4,188

Current Assets

Debtors
322,790
143,011
465,801

Cash at bank and in hand
110,764
-
110,764

Total Assets
441,584
139,169
580,753

Creditors

Due within one year
(123,323)
(316,213)
(439,536)

Due after more than one year
(83,290)
83,290
-

Total Identifiable net assets
234,971
(93,754)
141,217


Goodwill
1,527,239

Total purchase consideration
1,668,456

Consideration

£


Cash
1,000,000

Deferred consideration
389,340

Directly attributable costs
279,116

Total purchase consideration
1,668,456

Page 38

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

25.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
1,000,000

Directly attributable costs
279,117

1,279,117

Less: Cash and cash equivalents acquired
(110,764)

Net cash outflow on acquisition
1,168,353

The results of Bespoke Professional Training and Development Limited since acquisition are as follows:

Current period since acquisition
£

Turnover
1,544,371

Profit for the period since acquisition
100,818

Page 39

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

25.Business combinations (continued)

Acquisition of Greendale Ltd (T/A ECTA)

On 23 February 2024, 100% of the share capital of Greendale Limited was acquired by the Group.

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value adjustments
Fair value
£
£
£

Fixed Assets

Tangible
611,293
-
611,293

611,293
-
611,293

Current Assets

Debtors
104,718
(9,164)
95,554

Cash at bank and in hand
776,977
(128)
776,849

Total Assets
1,492,988
(9,292)
1,483,696

Creditors

Due within one year
(192,900)
(18,067)
(210,967)

Deferred taxation
(3,435)
-
(3,435)

Total Identifiable net assets
1,296,653
(27,359)
1,269,294


Goodwill
1,705,604

Total purchase consideration
2,974,898

Consideration

£


Cash
2,146,892

Deferred consideration
600,000

Directly attributable costs
228,006

Total purchase consideration
2,974,898

Page 40

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

25.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
2,146,892

Directly attributable costs
228,007

2,374,899

Less: Cash and cash equivalents acquired
(776,849)

Net cash outflow on acquisition
1,598,050

The results of Greendale Ltd (T/A ECTA) since acquisition are as follows:

Current period since acquisition
£

Turnover
453,962

Profit for the period since acquisition
52,400


26.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group during the year and amounted to £277,427 (2023: £238,766). Contributions totalling £86,886 (2023: £75,564) were payable to the fund at the balance sheet date and are included in other creditors.

Page 41

 
Back 2 Work Group Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 31 July 2024

27.


Commitments under operating leases

At 31 July 2024 the Group had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2024
2023
£
£

Land and Buildings

Not later than 1 year
350,673
308,190

Later than 1 year and not later than 5 years
88,340
206,971

439,013
515,161


Group
Group
2024
2023
£
£

Other

Not later than 1 year
2,776
2,830

Later than 1 year and not later than 5 years
-
4,404

2,776
7,234

The Company had no commitments under non-cancellable operating leases at the balance sheet date.


28.


Related party transactions

The directors have chosen not to disclose transactions entered into with other companies wholly owned with the group as permitted under FRS 102 paragraph 33.1A.
Loan notes totalling £16,485,041 (
2023: £16,485,041) have been issued to shareholders. The loan notes attract interest at 10% per annum. During the year, interest of £1,640,768 (2023: £1,640,357) was incurred. The loan notes are redeemable at par five years from the date of issue which is 22 October 2025.
Loan notes totalling £1,993,825 (
2023: £1,993,825) have also been issued to shareholders. The loan notes attract interest at 10% per annum. During the year, interest of £199,383 (2023: £200,000) was incurred. The loan notes are redeemable at par five years from the date of issue which is 8 June 2027.
Key Management Personnel
Key management is considered to be the finance director and sales/operations director, neither of whom are
statutory directors. Total remuneration in the year relating to these directors was £221,360 (
2023: £224,878).

 
Page 42