Company registration number 00804474 (England and Wales)
A.P. FAULKNER (HEATING) LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2024
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
A.P. FAULKNER (HEATING) LIMITED
CONTENTS
Page
Company information
1
Strategic report
2 - 4
Directors' report
5 - 6
Independent auditor's report
7 - 10
Statement of comprehensive income
11
Balance sheet
12 - 13
Statement of changes in equity
14
Statement of cash flows
15
Notes to the financial statements
16 - 30
A.P. FAULKNER (HEATING) LIMITED
COMPANY INFORMATION
- 1 -
Directors
Mr. K. Faulkner
Mrs. M. Faulkner
Mr. R. Cole
Mr. I. Rabbitts
Secretary
Mrs. M. Faulkner
Company number
00804474
Registered office
Unit K  Bridge Farm
Reading Road
Arborfield
Reading
Berkshire
United Kingdom
RG2 9HT
Auditor
Verallo
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
A.P. FAULKNER (HEATING) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 2 -

PRINCIPAL ACTIVITY AND BUSINESS REVIEW

The principal activity of the company is Installation and Servicing of Gas and Renewable energy heating systems.

AP Faulkner (Heating) Limited has a developed strategic plan which is reviewed every year. This is being delivered in all areas of the business to:

 

Key performance indicators

During the year, the turnover increased by 2.3% from £11,840,230 in 2023 to £12,107,323 in 2024, whilst maintaining a gross profit margin of 21%.

 

EBITDA has decreased slightly from £202,149 in 2024 to £192,550 in 2024, which is reflective of the increase in the costs of overheads across the business together with an increased requirement for administrative support for funded air source heat pump installations being carried out under government funding.

The company has seen continued to see significant increases in cost of materials and labour but has manged to maintain gross profit margin through careful cost management and efficient contract negotiation.

The Balance Sheet remains strong with good cash reserves and this together with only a small decrease in the EBITDA demonstrates good stability and provides a good platform for the forthcoming year.

The company has continued to make a significant financial investment to secure the current ISO9001, ISO14001 and ISO45001 accreditations, in addition the company has consolidated its PAS2030 accreditation to ensure compliance with all government funded renewable energy installation contracts. The company has further gained high level accreditations in line with requirements for public sector contracts, such as Constructionline Gold CHAS Advanced, with a view to obtaining CHAS Elite in the forthcoming year.

 

These accreditations underline the company’s continued commitment to providing a high quality, safe and environmentally aware service to all its clients and customers it has also continued to help maintain the company’s eligibility for future tenders and work. The company’s commitment to these standards continue to ensure high levels of risk management in Quality, Health & Safety and Environmental areas helping to secure the future of the company.

Employees

As an employer, AP Faulkner (Heating) Ltd provides an effective training programme to ensure that all staff members are trained to the required standard, and in line with the requirements of the regulatory requirements for Gas, Electric and Renewable Energy Heating Installations and Servicing together with all required H&S training in line with the company’s ISO45001 accreditation.

A.P. FAULKNER (HEATING) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 3 -
Principal risks and uncertainties

Credit Risk

The company operates in a field where significant investment is required in ensuring that the fleet is refreshed on a regular basis, this gives rise to a credit risk, which is monitored by the use of leasing agreements with fixed monthly rates, as opposed to variable rates.

 

Competitive Risk

The company operates in a competitive environment, to mitigate this risk, we ensure that the services provided are in line with our customers needs, and that strong relationships are maintained with our key customers. We ensure all required technical training and accreditations are renewed to ensure full compliance with all contracts and forthcoming tenders. We operate with a robust administrative team ensuring fully compliance with all the rigorous documentation requirements of the PAS2030/2035 funded works.

Technical Risk

The company operates with the following accreditations:

Gas Safe

MCS

NICEIC

Constructionline

CHAS Advanced

ISO9001, 14001 and 45001

PAS2030

 

These accreditations reflect our quality management principles. The company ensures that it has appropriate professional indemnity insurance.

Future developments

Given the current economic position within the UK, there continue to be uncertainties as to whether the UK will see any economic growth in the forthcoming year. Forthcoming increases in Employers NI and major changes to Employment in the forthcoming year is likely to result in a challenging year for business but the company is in an excellent position financially to manage these changes..

 

Interest rates are predicted to continue to stabilise in the short to medium term.

 

Overall in the coming year we aim to increase our revenues. The company has secured all its major contracts with Housing Associations and Local Authorities for the forthcoming year as well as securing additional new contracts with new clients, particularly in the renewable energy sector of our business.

 

We will continue to develop our relationships with our customers, generating new business where possible and maintaining retention levels. The company continues to monitor its costs closely and secures annual cost of living increases from its major clients helping to mitigate the continued effects of the current inflation levels.

 

A.P. FAULKNER (HEATING) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 4 -

On behalf of the board

Mr. K. Faulkner
Director
26 March 2025
A.P. FAULKNER (HEATING) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 5 -

The directors present their annual report and financial statements for the year ended 30 June 2024.

Results and dividends

The results for the year are set out on page 11.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Mr. K. Faulkner
Mrs. M. Faulkner
Mr. R. Cole
Mr. I. Rabbitts
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Auditor

The auditor, Verallo, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of directors' responsibilities

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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

A.P. FAULKNER (HEATING) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 6 -
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
Mr. K. Faulkner
Director
26 March 2025
A.P. FAULKNER (HEATING) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF A.P. FAULKNER (HEATING) LIMITED
- 7 -
Opinion

We have audited the financial statements of A.P. Faulkner (Heating) Limited for the year ended 30 June 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

A.P. FAULKNER (HEATING) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF A.P. FAULKNER (HEATING) LIMITED
- 8 -

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

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

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

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

A.P. FAULKNER (HEATING) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF A.P. FAULKNER (HEATING) LIMITED
- 9 -

Our approach was as follows:

 

 

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

 

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditors/audit-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor%E2%80%99s-responsibilities-for. This description forms part of our auditor’s report.

A.P. FAULKNER (HEATING) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF A.P. FAULKNER (HEATING) LIMITED
- 10 -
Use of report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Michelle Hewitt-Dutton FCCA (Senior Statutory Auditor)
For and on behalf of Verallo
Statutory Auditor
Office: Henley-on-Thames
26 March 2025
A.P. FAULKNER (HEATING) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
- 11 -
2024
2023
Notes
£
£
Turnover
3
12,107,323
11,840,230
Cost of sales
(9,602,431)
(9,334,452)
Gross profit
2,504,892
2,505,778
Administrative expenses
(2,372,953)
(2,359,238)
Other operating income
-
0
5,435
Operating profit
4
131,939
151,975
Interest receivable and similar income
7
22,970
9,411
Interest payable and similar expenses
8
(14,188)
(19,074)
Profit before taxation
140,721
142,312
Tax on profit
9
(25,576)
-
0
Profit for the financial year
115,145
142,312

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

The notes on pages 16 to 30 form part of these financial statements
A.P. FAULKNER (HEATING) LIMITED
BALANCE SHEET
AS AT
30 JUNE 2024
30 June 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
162,756
133,692
Current assets
Stocks
11
69,560
63,756
Debtors
12
2,519,502
2,118,727
Cash at bank and in hand
1,353,357
1,333,888
3,942,419
3,516,371
Creditors: amounts falling due within one year
13
(2,688,030)
(2,293,963)
Net current assets
1,254,389
1,222,408
Total assets less current liabilities
1,417,145
1,356,100
Creditors: amounts falling due after more than one year
14
(22,222)
(91,667)
Provisions for liabilities
Deferred tax liability
17
15,345
-
0
(15,345)
-
Net assets
1,379,578
1,264,433
Capital and reserves
Called up share capital
20
800
800
Profit and loss reserves
1,378,778
1,263,633
Total equity
1,379,578
1,264,433
A.P. FAULKNER (HEATING) LIMITED
BALANCE SHEET (CONTINUED)
AS AT
30 JUNE 2024
30 June 2024
- 13 -
The financial statements were approved by the board of directors and authorised for issue on 26 March 2025 and are signed on its behalf by:
Mr. K. Faulkner
Director
Company Registration No. 00804474
The notes on pages 16 to 30 form part of these financial statements
A.P. FAULKNER (HEATING) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
- 14 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 July 2022
800
1,121,321
1,122,121
Year ended 30 June 2023:
Profit and total comprehensive income for the year
-
142,312
142,312
Balance at 30 June 2023
800
1,263,633
1,264,433
Year ended 30 June 2024:
Profit and total comprehensive income for the year
-
115,145
115,145
Balance at 30 June 2024
800
1,378,778
1,379,578
The notes on pages 16 to 30 form part of these financial statements
A.P. FAULKNER (HEATING) LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
- 15 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
25
152,270
(496,174)
Interest paid
(14,188)
(19,074)
Net cash inflow/(outflow) from operating activities
138,082
(515,248)
Investing activities
Purchase of tangible fixed assets
(113,987)
(11,399)
Proceeds on disposal of tangible fixed assets
36,673
-
0
Receipts arising from loans made
(3,158)
1,000
Interest received
22,970
9,411
Net cash used in investing activities
(57,502)
(988)
Financing activities
Repayment of bank loans
(100,000)
(300,000)
Payment of finance leases obligations
38,889
-
0
Net cash used in financing activities
(61,111)
(300,000)
Net increase/(decrease) in cash and cash equivalents
19,469
(816,236)
Cash and cash equivalents at beginning of year
1,333,888
2,150,124
Cash and cash equivalents at end of year
1,353,357
1,333,888
The notes on pages 16 to 30 form part of these financial statements
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
- 16 -
1
Accounting policies
Company information

A.P. Faulkner (Heating) Limited (00804474) is a company limited by shares incorporated in England and Wales. The registered office is Unit K Bridge Farm, Reading Road, Arborfield, Reading, Berkshire, United Kingdom, RG2 9HT.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

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

1.2
Going concern

The financial statements have been prepared on a going concern basis, which assumes the company will continue in operational existence, and will be able to meet its liabilities as they fall due, for a period of at least twelve months from the date of approval of the financial statements.

 

The directors have reviewed the future expected budgets and financial forecasts of the company, for the foreseeable future and have a reasonable expectation that the company has adequate resources to continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover represents amounts receivable for goods and services provided in the normal course of business, net of trade discounts, VAT and other sales related taxes.

Profit is recognised on long-term contracts, if the final outcome can be assessed with reasonable certainty, by including in the profit and loss account turnover and related costs as contract activity progresses. Turnover is calculated by reference to the value of work performed to date as a proportion of the total contract value.

1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Improvements to property
Over the life of the lease
Plant and machinery
20% reducing balance and 20% straight line
Fixtures & fittings
20% reducing balance
Motor vehicles
25% reducing balance
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 17 -

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

1.5
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

1.6
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.7
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

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

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 18 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors and bank loans, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 19 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.8
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

1.9
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.10
Retirement benefits

The company operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the company. The annual contributions payable are charged to the profit and loss account.

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 20 -
1.11
Leases

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

 

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

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

1.12
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

1.13

Long term contracts

Amounts recoverable on contracts, which are included in debtors, are stated at the net sales value of the work done after provision for contingencies and anticipated future losses on contracts, less amounts received as progress payments on account. Excess progress payments are included in creditors as payments on account.

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 21 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

 

In preparing these financial statements, the directors have made the following judgements:

 

Other key sources of estimation uncertainty:

 

 

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 22 -
3
Turnover and other revenue

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

2024
2023
£
£
Turnover analysed by class of business
Turnover
12,107,323
11,840,230
2024
2023
£
£
Other revenue
Interest income
22,970
9,411
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
10,271
11,244
Depreciation of owned tangible fixed assets
60,610
50,176
(Profit)/loss on disposal of tangible fixed assets
(12,360)
1,147
Operating lease charges
211,047
215,459
5
Employees

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

2024
2023
Number
Number
Directors
4
2
Administrative staff
17
18
Installation and service staff
39
40
Total
60
60
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
5
Employees
(Continued)
- 23 -

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
2,447,254
2,397,351
Social security costs
275,634
266,424
Pension costs
60,621
52,682
2,783,509
2,716,457
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
139,820
137,354
Company pension contributions to defined contribution schemes
15,339
6,883
155,159
144,237

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023 - 2).

Directors are also considered to be key management personnel.

7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
22,970
9,411

Investment income includes the following:

Interest on financial assets not measured at fair value through profit or loss
22,970
9,411
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 24 -
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
11,808
16,919
Other finance costs:
Interest on hire purchase contracts
2,380
2,155
14,188
19,074
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
10,231
-
0
Deferred tax
Origination and reversal of timing differences
15,345
-
0
Total tax charge
25,576
-
0

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

2024
2023
£
£
Profit before taxation
140,721
142,312
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 20.50%)
35,180
29,174
Tax effect of expenses that are not deductible in determining taxable profit
210
54
Unutilised tax losses carried forward
-
0
(29,228)
Tax at marginal rate
(600)
-
0
Tax losses utilised
(9,214)
-
0
Taxation charge for the year
25,576
-

The company has carried forward losses of £nil (2023 - £39,516) to offset against future trading profits.

 

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 25 -
10
Tangible fixed assets
Improvements to property
Plant and machinery
Fixtures & fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 July 2023
172,841
79,509
18,885
155,109
426,344
Additions
-
0
10,599
-
0
103,388
113,987
Disposals
-
0
-
0
-
0
(72,871)
(72,871)
At 30 June 2024
172,841
90,108
18,885
185,626
467,460
Depreciation and impairment
At 1 July 2023
131,598
49,285
15,211
96,558
292,652
Depreciation charged in the year
17,273
11,896
765
30,676
60,610
Eliminated in respect of disposals
-
0
-
0
-
0
(48,558)
(48,558)
At 30 June 2024
148,871
61,181
15,976
78,676
304,704
Carrying amount
At 30 June 2024
23,970
28,927
2,909
106,950
162,756
At 30 June 2023
41,243
30,224
3,674
58,551
133,692
11
Stocks
2024
2023
£
£
Raw materials and consumables
69,560
63,756
12
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
2,003,289
1,853,250
Other debtors
223,300
82,026
Prepayments and accrued income
292,913
183,451
2,519,502
2,118,727
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 26 -
13
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
15
91,667
100,000
Obligations under hire purchase agreements
16,667
-
Trade creditors
2,331,596
1,908,399
Amounts owed to group undertakings
100,000
-
0
Corporation tax
10,231
-
0
Other taxation and social security
69,278
74,588
Other creditors
18,430
139,928
Accruals and deferred income
50,161
71,048
2,688,030
2,293,963
14
Creditors: amounts falling due after more than one year
2024
2023
£
£
Bank loans and overdrafts
15
-
0
91,667
Obligations under hire purchase agreements
22,222
-
22,222
91,667

 

15
Loans and overdrafts
2024
2023
£
£
Bank loans
91,667
191,667
Payable within one year
91,667
100,000
Payable after one year
-
0
91,667

A Coronavirus Business Interruption Loan amounting to £500,000, was obtained on 14 April 2021 from the National Westminster Bank PLC. The loan is repayable by equal instalments, after the first year of deferral, and will be paid in full by 26 May 2027. Interest of £18,600 for the first year was supported by the government, thereafter interest continues to be charged at 2.62% above base. The loan is secured by a fixed and floating charge held by National Westminster Bank PLC, over the assets of the company.

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 27 -
16
Finance lease and hire purchase obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
16,667
-
0
In two to five years
22,222
-
0
38,889
-
0

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

 

Obligations under the finance leases are secured over the asset acquired.

17
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2024
2023
Balances:
£
£
ACAs
15,345
20,056
Tax losses
-
(20,056)
15,345
-
2024
Movements in the year:
£
Liability at 1 July 2023
-
Charge to profit or loss
15,345
Liability at 30 June 2024
15,345

The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 28 -
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
60,621
52,682

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

19
Financial instruments
Included within the amounts shown as Debtors and Creditors above are financial assets and financial liabilities, the classification of which are further analysed below:
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
2,109,246
1,935,276
Carrying amount of financial liabilities
Measured at amortised cost
2,630,743
2,311,042
20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
800
800
800
800
21
Operating lease commitments
Lessee

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

2024
2023
£
£
Within one year
111,440
111,440
Between two and five years
212,848
185,348
324,288
296,788
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 29 -
22
Related party transactions
Transactions with related parties

During the year the company made purchases from a company connected by mutual controlling party, totalling £334,720 (2023 - £334,720). At the year end an amount of £100,000 (2023 - £119,560), was owed from A P Faulkner (Heating) Limited to the connected company.

23
Directors' transactions

At the year end the directors loan account was overdrawn by £6,068 (2023 - £2,910). This amount is interest free and repayable on demand.

24
Ultimate controlling party

During the year, the ultimate controlling party was considered to be Mr. K Faulkner.

25
Cash generated from/(absorbed by) operations
2024
2023
£
£
Profit for the year after tax
115,145
142,312
Adjustments for:
Taxation charged
25,576
-
0
Finance costs
14,188
19,074
Investment income
(22,970)
(9,411)
(Gain)/loss on disposal of tangible fixed assets
(12,360)
1,147
Depreciation and impairment of tangible fixed assets
60,610
50,176
Movements in working capital:
(Increase)/decrease in stocks
(5,804)
8,252
(Increase)/decrease in debtors
(397,617)
125,244
Increase/(decrease) in creditors
375,502
(832,968)
Cash generated from/(absorbed by) operations
152,270
(496,174)
A.P. FAULKNER (HEATING) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 30 -
26
Analysis of changes in net funds
1 July 2023
Cash flows
30 June 2024
£
£
£
Cash at bank and in hand
1,333,888
19,469
1,353,357
Borrowings excluding overdrafts
(191,667)
100,000
(91,667)
Obligations under finance leases
-
(38,889)
(38,889)
1,142,221
80,580
1,222,801
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