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REALM CONSTRUCTION LIMITED
DIRECTORS' REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

 
REALM CONSTRUCTION LIMITED
 

COMPANY INFORMATION


Directors
Mr R Purvis 
Mr G Wight 
Mr C R Purvis 
Mr S Brown 




Registered number
SC110359



Registered office
New Thistle House
The Avenue

Lochgelly

Fife

KY5 9HG




Independent auditors
Sumer Auditco Limited, Statutory Auditor
Chartered Accountants

Pentland House

Saltire Centre

Glenrothes

Fife

KY6 2AH





 
REALM CONSTRUCTION LIMITED
 

CONTENTS



Page
Group strategic report
 
 
1 - 2
Directors' report
 
 
3 - 4
Independent auditors' report
 
 
5 - 8
Consolidated statement of comprehensive income
 
 
9
Consolidated statement of financial position
 
 
10
Company statement of financial position
 
 
11
Consolidated statement of changes in equity
 
 
12
Company statement of changes in equity
 
 
13
Consolidated statement of cash flows
 
 
14
Consolidated analysis of net debt
 
 
15
Notes to the financial statements
 
 
16 - 34


 
REALM CONSTRUCTION LIMITED
 

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2024

Introduction
 
The directors have pleasure in presenting their strategic report for the year ended 31 August 2024.

Business review
 
The principal activity of the Group during the period continued to be that of groundworks and building
construction contracts.
In view of the fact that the construction sector remains challenging, the directors are pleased to report a successful year with strong profits and a marked improvement in the Group's overall financial position.
The directors consider the key performance indicators to be turnover, operating profit and working capital management.
Turnover has decreased by 0.3% from £22,893,373 to £22,826,285. An operating profit of £2,726,887 was achieved compared to £2,170,319 in the previous year. Net current assets increased from £5,143,177 to £5,530,124 and net bank balances decreased by £3,516,842 during the year to 31 August 2024.
The directors are confident that results will remain positive in the year ahead with strong demand for the Group's services and the strategic management of contract delivery.  Despite ongoing optimism the directors are mindful of worldwide economic and political factors which could potentially impact on the Group's trading.

Principal risks and uncertainties
 
In line with other businesses connected to the construction industry, the Group's main commercial risks are the level of construction and house building on-going at any time to generate a requirement for its services. 
There is the continuing pressure on pricing and the risk associated with the loss of customers to be managed. Those risks which the Group finds itself exposed to are managed by a strong board of directors.
The Group's principal financial instruments comprise bank balances, bank overdrafts and loans, hire purchase agreements. The main purpose of these financial instruments is to finance Group operations.
Due to the nature of the financial instruments used by the Group there is no exposure to price risk. The Group's approach to managing other risks applicable to the financial instruments concerned is detailed below.
In respect of bank balances, the liquidity risk is managed by maintaining such flexibility through the use of overdrafts at floating rates of interest.
In respect of loans, these comprise inter-group loans, loans with other related companies, and also loans from financial institutions. The interest rate on the loans from the financial institutions is variable. The Group manages the liquidity risk by ensuring there are sufficient funds to meet the payments.
In respect of hire purchase assets, the liquidity risk in respect of these is managed to ensure sufficient funds are available to meet repayments.

Page 1

 
REALM CONSTRUCTION LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024

Safety and health, environment and quality
 
The Group recognises the importance of, and has policies and procedures in place to ensure its environmental, health and safety requirements are met at all times.


This report was approved by the board on 18 March 2025 and signed on its behalf.





Mr R Purvis
Director

Page 2

 
REALM CONSTRUCTION LIMITED
 

 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 AUGUST 2024

The directors present their report and the financial statements for the year ended 31 August 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 judgments 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 profit for the year, after taxation, amounted to £2,110,519 (2023 - £1,709,963).

Particulars of dividends paid are detailed in the notes to the financial statements.

Directors

The directors who served during the year were:

Mr R Purvis 
Mr G Wight 
Mr C R Purvis 
Mr S Brown 

Page 3

 
REALM CONSTRUCTION LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024


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 Group since the year end.

This report was approved by the board on 18 March 2025 and signed on its behalf.
 





Mr R Purvis
Director

Page 4

 
REALM CONSTRUCTION LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REALM CONSTRUCTION LIMITED
 

Opinion


We have audited the financial statements of Realm Construction Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 August 2024, which comprise the Consolidated statement of comprehensive income, the Consolidated statement of financial position, the Company statement of financial position, 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 August 2024 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 5

 
REALM CONSTRUCTION LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REALM CONSTRUCTION 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 3, 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 6

 
REALM CONSTRUCTION LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REALM CONSTRUCTION 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:

We gained an understanding of the legal and regulatory framework applicable to the group and the industry in which it operates, and considered the risk of acts by the group that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that 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 deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
We focused on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation, enquiries with management and enquiries of legal counsel. 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. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.


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.


Page 7

 
REALM CONSTRUCTION LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REALM CONSTRUCTION LIMITED (CONTINUED)


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.





MARK GIBSON (Senior statutory auditor)
for and on behalf of
Sumer Auditco Limited, Statutory Auditor
Chartered Accountants
Pentland House
Saltire Centre
Glenrothes
Fife
KY6 2AH

18 March 2025
Page 8

 
REALM CONSTRUCTION LIMITED
 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2024

2024
2023
£
£

  

Turnover
 4 
22,826,285
22,893,373

Cost of sales
  
(18,454,514)
(19,553,052)

Gross profit
  
4,371,771
3,340,321

Administrative expenses
  
(1,822,741)
(1,296,373)

Other operating income
 5 
177,857
126,371

Operating profit
 6 
2,726,887
2,170,319

Interest receivable and similar income
 9 
111,317
69,909

Interest payable and similar expenses
 10 
(15,787)
(27,779)

Profit before taxation
  
2,822,417
2,212,449

Tax on profit
 11 
(711,898)
(502,486)

Profit for the financial year
  
2,110,519
1,709,963

Profit for the year attributable to:
  

Owners of the parent Company
  
2,110,519
1,709,963

  
2,110,519
1,709,963

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 16 to 34 form part of these financial statements.

Page 9

 
REALM CONSTRUCTION LIMITED
REGISTERED NUMBER: SC110359

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 AUGUST 2024

2024
2023
£
£

Fixed assets
  

Tangible assets
 14 
1,682,214
1,659,931

Investments
 16 
1,250,000
-

Investment property
 15 
930,000
930,000

  
3,862,214
2,589,931

Current assets
  

Debtors: amounts falling due within one year
 17 
7,718,795
5,611,324

Cash at bank and in hand
 18 
1,441,792
4,958,634

  
9,160,587
10,569,958

Creditors: amounts falling due within one year
 19 
(3,630,463)
(5,426,781)

Net current assets
  
 
 
5,530,124
 
 
5,143,177

Total assets less current liabilities
  
9,392,338
7,733,108

Creditors: amounts falling due after more than one year
 20 
(10,000)
(93,791)

Provisions for liabilities
  

Deferred taxation
 24 
(364,560)
(303,308)

  
 
 
(364,560)
 
 
(303,308)

Net assets
  
9,017,778
7,336,009


Capital and reserves
  

Called up share capital 
 25 
211,000
211,000

Investment property reserve
 26 
293,869
293,869

Profit and loss account
 26 
8,512,909
6,831,140

  
9,017,778
7,336,009


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 18 March 2025.




Mr R Purvis
Mr G Wight
Director
Director

The notes on pages 16 to 34 form part of these financial statements.

Page 10

 
REALM CONSTRUCTION LIMITED
REGISTERED NUMBER: SC110359

COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 AUGUST 2024

2024
2023
£
£

Fixed assets
  

Tangible assets
 14 
1,137,202
1,217,707

Investments
 16 
1,300,000
50,000

Investment property
 15 
930,000
930,000

  
3,367,202
2,197,707

Current assets
  

Debtors: amounts falling due within one year
 17 
6,136,026
4,749,493

Cash at bank and in hand
 18 
1,246,467
4,105,628

  
7,382,493
8,855,121

Creditors: amounts falling due within one year
 19 
(3,006,053)
(4,908,146)

Net current assets
  
 
 
4,376,440
 
 
3,946,975

Total assets less current liabilities
  
7,743,642
6,144,682

  

Creditors: amounts falling due after more than one year
 20 
(10,000)
(79,406)

Provisions for liabilities
  

Deferred taxation
 24 
(253,303)
(253,861)

  
 
 
(253,303)
 
 
(253,861)

Net assets
  
7,480,339
5,811,415


Capital and reserves
  

Called up share capital 
 25 
211,000
211,000

Investment property reserve
 26 
293,869
293,869

Profit and loss account
 26 
6,975,470
5,306,546

  
7,480,339
5,811,415


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 18 March 2025.


Mr R Purvis
Mr G Wight
Director
Director

The notes on pages 16 to 34 form part of these financial statements.

Page 11

 
REALM CONSTRUCTION LIMITED
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024


Called up share capital
Investment property revaluation reserve
Profit and loss account
Equity attributable to owners of parent Company
Total equity

£
£
£
£
£

At 1 September 2023
211,000
293,869
6,831,140
7,336,009
7,336,009



Profit for the year
-
-
2,110,519
2,110,519
2,110,519

Dividends: Equity capital
-
-
(428,750)
(428,750)
(428,750)


At 31 August 2024
211,000
293,869
8,512,909
9,017,778
9,017,778


The notes on pages 16 to 34 form part of these financial statements.


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2023


Called up share capital
Investment property revaluation reserve
Profit and loss account
Equity attributable to owners of parent Company
Total equity

£
£
£
£
£

At 1 September 2022
211,000
293,869
5,573,677
6,078,546
6,078,546



Profit for the year
-
-
1,709,963
1,709,963
1,709,963

Dividends: Equity capital
-
-
(452,500)
(452,500)
(452,500)


At 31 August 2023
211,000
293,869
6,831,140
7,336,009
7,336,009


The notes on pages 16 to 34 form part of these financial statements.

Page 12

 
REALM CONSTRUCTION LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024


Called up share capital
Investment property revaluation reserve
Profit and loss account
Total equity

£
£
£
£

At 1 September 2023
211,000
293,869
5,306,546
5,811,415



Profit for the year
-
-
2,097,674
2,097,674

Dividends: Equity capital
-
-
(428,750)
(428,750)


At 31 August 2024
211,000
293,869
6,975,470
7,480,339


The notes on pages 16 to 34 form part of these financial statements.


COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2023


Called up share capital
Investment property revaluation reserve
Profit and loss account
Total equity

£
£
£
£

At 1 September 2022
211,000
293,869
4,117,255
4,622,124



Profit for the year
-
-
1,641,791
1,641,791

Dividends: Equity capital
-
-
(452,500)
(452,500)


At 31 August 2023
211,000
293,869
5,306,546
5,811,415


The notes on pages 16 to 34 form part of these financial statements.

Page 13

 
REALM CONSTRUCTION LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 AUGUST 2024

2024
2023
£
£

Cash flows from operating activities

Profit for the financial year
2,110,519
1,709,963

Adjustments for:

Depreciation of tangible assets
505,990
334,248

Loss on disposal of tangible assets
(54,896)
(76,332)

Interest paid
15,787
27,779

Interest received
(111,317)
(69,909)

Taxation charge
711,898
502,486

(Increase) in debtors
(2,107,471)
(314,049)

(Decrease)/increase in creditors
(1,999,870)
2,184,763

Corporation tax (paid)
(212,533)
(77,250)

Net cash generated from operating activities

(1,141,893)
4,221,699


Cash flows from investing activities

Purchase of tangible fixed assets
(679,410)
(1,147,158)

Sale of tangible fixed assets
206,033
81,558

Purchase of share in associates
(1,250,000)
-

Interest received
111,317
69,909

HP interest paid
(15,192)
(26,051)

Net cash from investing activities

(1,627,252)
(1,021,742)

Cash flows from financing activities

Repayment of loans
(10,000)
(9,167)

Repayment of/new finance leases
(308,352)
5,038

Dividends paid
(428,750)
(452,500)

Interest paid
(595)
(1,728)

Net cash used in financing activities
(747,697)
(458,357)

Net (decrease)/increase in cash and cash equivalents
(3,516,842)
2,741,600

Cash and cash equivalents at beginning of year
4,958,634
2,217,034

Cash and cash equivalents at the end of year
1,441,792
4,958,634


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,441,792
4,958,634

1,441,792
4,958,634


The notes on pages 16 to 34 form part of these financial statements.

Page 14

 
REALM CONSTRUCTION LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 AUGUST 2024




At 1 September 2023
Cash flows
At 31 August 2024
£

£

£

Cash at bank and in hand

4,958,634

(3,516,842)

1,441,792

Debt due after 1 year

(20,000)

10,000

(10,000)

Debt due within 1 year

(10,000)

-

(10,000)

Finance leases

(382,143)

308,352

(73,791)


4,546,491
(3,198,490)
1,348,001

The notes on pages 16 to 34 form part of these financial statements.

Page 15

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

1.


General information

Realm Construction Limited is a company limited by shares, incorporated in Scotland. Its registered office is New Thistle House, The Avenue, Lochgelly, Fife, KY5 9HG.
The principal activity of the group was that of groundworks and building construction contracts.
The financial statements are presented in sterling which is the functional currency of the Company and rounded to the nearest £. 

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 judgment 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 Statement of financial position, 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 16

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

2.Accounting policies (continued)

 
2.3

Associates and joint ventures

An entity is treated as a joint venture where the Group is a party to a contractual agreement with one or more parties from outside the Group to undertake an economic activity that is subject to joint control.

An entity is treated as an associated undertaking where the Group exercises significant influence in that it has the power to participate in the operating and financial policy decisions.
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The Consolidated statement of comprehensive income includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated statement of financial position, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition.
Any premium on acquisition is dealt with in accordance with the goodwill policy.

 
2.4

Turnover

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods

Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of turnover can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of turnover can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 17

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

2.Accounting policies (continued)

 
2.5

Tangible fixed assets

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

Land is not depreciated. Depreciation on other assets 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:

Leasehold property improvements
-
20% straight line
Plant and machinery
-
20% straight line
Motor vehicles
-
25% straight line
Office equipment
-
15% 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.

 
2.6

Investment property

Investment property is carried at fair value determined annually by directors or external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

 
2.7

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.8

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.

 
2.9

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

Page 18

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

2.Accounting policies (continued)

 
2.10

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 Statement of financial position when the Group becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

 
2.11

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.

 
2.12

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated statement of comprehensive income in the same period as the related expenditure.

 
2.13

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.

 
2.14

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

 
2.15

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.

Page 19

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

2.Accounting policies (continued)

 
2.16

Leased assets: the Group as lessee

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

 
2.17

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 Statement of financial position. The assets of the plan are held separately from the Group in independently administered funds.

 
2.18

Interest income

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

 
2.19

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.20

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.

Page 20

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

2.Accounting policies (continued)

 
2.21

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 tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company 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 reporting 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; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

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 reporting date.



3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The most significant estimation within the Group's financial statements relates to work in progress. The directors review work in progress levels on a monthly basis to ensure that all work carried out on ongoing contracts is reflected in the Group's financial statements.
The directors also review depreciation rates on a regular basis to ensure that the policy rates remain appropriate.
The directors also require to exercise judgement in assessing the recoverability of trade debtors, and make appropriate provisions where their credit control procedures indicate that trade debtors balances may not be fully recoverable.


4.


Turnover

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


2024
2023
£
£

Construction services
22,826,285
22,893,373


All turnover arose within the United Kingdom.

Page 21

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

5.


Other operating income

2024
2023
£
£

Other operating income
57,546
13,178

Rents receivable
120,311
113,193

177,857
126,371



6.


Operating profit

The operating profit is stated after charging:

2024
2023
£
£

Depreciation of tangible fixed assets
505,990
334,248

Fees payable to the Group's auditor and its associates for the audit of the Group's annual financial statements
15,360
11,550

Other operating lease rentals
1,735,877
2,299,040


7.


Employees

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


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


Wages and salaries
3,567,995
3,429,971
2,357,198
2,333,249

Social security costs
385,933
365,589
253,293
246,595

Cost of defined contribution scheme
119,553
151,798
87,246
118,871

4,073,481
3,947,358
2,697,737
2,698,715


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


        2024
        2023
            No.
            No.







Number of production staff
81
76



Number of administrative staff
3
3



Number of management staff
5
9

89
88

Page 22

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

8.


Directors' remuneration

2024
2023
£
£

Directors' emoluments
140,851
155,305

Group contributions to defined contribution pension schemes
20,900
44,300

161,751
199,605


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




9.


Interest receivable

2024
2023
£
£


Bank interest receivable
111,317
69,909


10.


Interest payable and similar expenses

2024
2023
£
£


Bank interest payable
595
1,728

Finance leases and hire purchase contracts
15,192
26,051

15,787
27,779

Page 23

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

11.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
650,646
268,856


650,646
268,856


Total current tax
650,646
268,856

Deferred tax


Origination and reversal of timing differences
61,252
233,630

Total deferred tax
61,252
233,630


Tax on profit
711,898
502,486

Factors affecting tax charge for the year

The tax assessed for the year is the same as (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 21.51506%). The differences are explained below:

2024
2023
£
£


Profit on ordinary activities before tax
2,822,417
2,212,449


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 21.51506%)
705,604
476,010

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
6,294
3,034

Capital allowances for year in excess of depreciation
-
(9,127)

Changes in tax rates leading to an increase (decrease) in the tax charge
-
32,569

Total tax charge for the year
711,898
502,486


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 24

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

12.


Dividends

2024
2023
£
£


Equity dividends on ordinary shares
428,750
452,500


13.


Parent company profit for the year

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 profit after tax of the parent Company for the year was £2,097,674 (2023 - £1,641,791).

Page 25

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

14.


Tangible fixed assets

Group






Leasehold property improve-ments
Plant and machinery
Motor vehicles
Office equipment
Total

£
£
£
£
£



Cost or valuation


At 1 September 2023
170,870
1,378,530
1,419,895
4,577
2,973,872


Additions
-
397,568
281,842
-
679,410


Disposals
-
(296,635)
(164,951)
-
(461,586)



At 31 August 2024

170,870
1,479,463
1,536,786
4,577
3,191,696



Depreciation


At 1 September 2023
68,348
515,137
725,879
4,577
1,313,941


Charge for the year on owned assets
34,174
205,613
266,203
-
505,990


Disposals
-
(145,498)
(164,951)
-
(310,449)



At 31 August 2024

102,522
575,252
827,131
4,577
1,509,482



Net book value



At 31 August 2024
68,348
904,211
709,655
-
1,682,214



At 31 August 2023
102,522
863,393
694,016
-
1,659,931

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£
£



Plant and machinery
-
204,156

Motor vehicles
221,097
451,051

221,097
655,207

Page 26

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

Company






Leasehold property improve-ments
Plant and machinery
Motor vehicles
Total

£
£
£
£

Cost or valuation


At 1 September 2023
131,583
788,550
1,071,136
1,991,269


Additions
-
34,486
245,040
279,526


Disposals
-
-
(144,098)
(144,098)



At 31 August 2024

131,583
823,036
1,172,078
2,126,697



Depreciation


At 1 September 2023
52,634
202,628
518,300
773,562


Charge for the year on owned assets
26,317
123,191
210,523
360,031


Disposals
-
-
(144,098)
(144,098)



At 31 August 2024

78,951
325,819
584,725
989,495



Net book value



At 31 August 2024
52,632
497,217
587,353
1,137,202



At 31 August 2023
78,949
585,922
552,836
1,217,707






The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£
£



Motor vehicles
139,475
331,559

139,475
331,559

Page 27

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

15.


Investment property

Group


Freehold investment property

£



Valuation


At 1 September 2023
930,000



At 31 August 2024
930,000

The directors consider the valuations to be reasonable based on open market value for existing use and have updated the valuations as at 31 August 2024 based on current rental income and appropriate investment property yields.






Company





Freehold investment property

£



Valuation


At 1 September 2023
930,000



At 31 August 2024
930,000

The directors consider the valuations to be reasonable based on open market value for existing use and have updated the valuations as at 31 August 2024 based on current rental income and appropriate investment property yields.

Page 28

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

16.


Fixed asset investments

Group
Investments in Associates
The net book value of group fixed asset investments in relation to Investments in Associates amounting to £1,250,000 (2023 - £nil) comprises of the initial cost of the investment of £1,250,000, with no movements in the short period since acquisition, under the equity method of accounting.

Company





Investments in subsidiary companies
Investments in associates
Total

£
£
£



Cost or valuation


At 1 September 2023
50,000
-
50,000


Additions
-
1,250,000
1,250,000



At 31 August 2024
50,000
1,250,000
1,300,000




During the year, Realm Construction Limited acquired 50% of the Ordinary issued share capital of Fife Airport Limited.


Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Duncan-Pryde (Contractors) Limited
New Thistle House, The Avenue, Lochgelly, Fife, KY5 9HG
Ordinary
100%


17.


Debtors

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


Trade debtors
2,742,653
1,257,525
2,202,050
932,114

Other debtors
3,013,462
978,777
2,205,880
797,020

Prepayments and accrued income
67,329
56,204
52,099
40,398

Amounts recoverable on long-term contracts
1,895,351
3,318,818
1,675,997
2,979,961

7,718,795
5,611,324
6,136,026
4,749,493


Page 29

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

18.


Cash and cash equivalents

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

Cash at bank and in hand
1,441,792
4,958,634
1,246,467
4,105,628

1,441,792
4,958,634
1,246,467
4,105,628



19.


Creditors: Amounts falling due within one year

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

Bank loans
10,000
10,000
10,000
10,000

Trade creditors
1,699,690
3,009,204
876,152
2,441,516

Amounts owed to group undertakings
-
-
344,195
304,583

Other taxation and social security
1,009,754
728,488
973,862
697,075

Net obligations under hire purchase creditors
73,791
308,352
59,406
170,063

Other creditors
-
23,405
-
22,285

Accruals and deferred income
837,228
1,347,332
742,438
1,262,624

3,630,463
5,426,781
3,006,053
4,908,146


Secured loans
Net obligations under hire purchase creditors are secured over the relevant assets.


20.


Creditors: Amounts falling due after more than one year

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

Bank loans
10,000
20,000
10,000
20,000

Net obligations under hire purchase creditors
-
73,791
-
59,406

10,000
93,791
10,000
79,406


Secured loans
Net obligations under hire purchase creditors are secured over the relevant assets.



Page 30

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

21.


Loans


Analysis of the maturity of loans is given below:


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

Amounts falling due within one year

Bank loans
10,000
10,000
10,000
10,000

Amounts falling due 1-2 years

Bank loans
10,000
10,000
10,000
10,000

Amounts falling due 2-5 years

Bank loans
-
10,000
-
10,000


20,000
30,000
20,000
30,000



22.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

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

Within one year
73,791
308,352
59,406
170,063

Between 1-5 years
-
73,791
-
59,406

73,791
382,143
59,406
229,469

Page 31

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

23.


Financial instruments

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

Financial assets

Financial assets measured at fair value through profit or loss
1,441,792
4,958,634
1,246,467
4,105,628

Financial assets that are debt instruments measured at amortised cost
5,756,115
2,540,885
4,407,932
1,729,134

7,197,907
7,499,519
5,654,399
5,834,762


Financial liabilities

Financial liabilities measured at amortised cost
(1,719,690)
(3,629,623)
(896,152)
(2,922,526)


Financial assets measured at fair value through profit or loss comprise cash at bank and in hand.


Financial assets measured at amortised cost comprise trade debtors, other debtors and loans.


Financial liabilities measured at amortised cost comprise trade creditors, other creditors and loans.


24.


Deferred taxation


Group



2024


£






At beginning of year
(303,308)


Charged to profit or loss
(61,252)



At end of year
(364,560)

Page 32

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
 
24.Deferred taxation (continued)

Company


2024


£






At beginning of year
(253,861)


Charged to profit or loss
558



At end of year
(253,303)

The provision for deferred taxation is made up as follows:

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

Accelerated capital allowances
(335,539)
(274,092)
(224,282)
(224,645)

Gain on revaluation
(29,216)
(29,216)
(29,216)
(29,216)

Short term timing difference
195
-
195
-

(364,560)
(303,308)
(253,303)
(253,861)


25.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



203,150 (2023 - 203,150) A Ordinary shares of £1.00 each
203,150
203,150
7,250 (2023 - 7,250) B Ordinary shares of £1.00 each
7,250
7,250
100 (2023 - 100) C Ordinary shares of £1.00 each
100
100
100 (2023 - 100) D Ordinary shares of £1.00 each
100
100
100 (2023 - 100) E Ordinary shares of £1.00 each
100
100
100 (2023 - 100) F Ordinary shares of £1.00 each
100
100
100 (2023 - 100) G Ordinary shares of £1.00 each
100
100
100 (2023 - 100) H Ordinary shares of £1.00 each
100
100

211,000

211,000


Page 33

 
REALM CONSTRUCTION LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024

26.


Reserves

Investment property revaluation reserve

Investment property revaluation reserve includes amounts relating to the revaluation of investment property. These reserves are non-distributable.

Profit and loss account

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


27.


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 to the fund and amounted to £119,553 (2023 - £151,798). Contributions totaling £2,023 (2023 - £4,789) were payable to the fund at the reporting date.


28.


Commitments under operating leases

The Group and the Company had no commitments under non-cancellable operating leases at the reporting date.


29.


Related party transactions

The Company and Group has taken the exemption available under s33.1A of FRS 102 not to disclose transactions with other wholly owned members of the group.
During the year the Group entered into the following transactions with other related parties:


2024
2023
£
£

Sales to other related parties other than group companies
310,507
281,596
Purchases from other related parties other than group companies
6,198,457
8,078,323
Net trading balances due from/(to) other related parties other than group companies
(468,671)
(993,420)
Amounts due from/(to) other related parties other than group companies
605,000
495,000


30.


Controlling party

The Group was under the control of Mr R Purvis throughout the current and previous year. Mr R Purvis is the managing director and majority shareholder.

Page 34