Registered number: 03619534
Energy Conservation Solutions Limited
Unaudited
Financial statements
Information for filing with the registrar
For the Year Ended 30 June 2024
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Energy Conservation Solutions Limited
Registered number: 03619534
Balance Sheet
As at 30 June 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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The directors consider that the company is entitled to exemption from audit under section 477 of the Companies Act 2006 and members have not required the company to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
Page 1
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Energy Conservation Solutions Limited
Registered number: 03619534
Balance Sheet (continued)
As at 30 June 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 3 to 12 form part of these financial statements.
Page 2
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
The company is a private company, limited by share capital, and incorporated in England and Wales. The address of the registered office is New Kings Court Tollgate, Chandler's Ford, Eastleigh, Hampshire, SO53 3LG. The Registered Number of the company is 03619534. The principal place of business is Franklyn House, Daux Road, Billingshurst, West Sussex, RH14 9SJ. The principal activity of the company is the supply and installation of energy efficient technologies.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The financial statements are presented in sterling which is the functional currency of the company and are rounded to the nearest whole £.
The following principal accounting policies have been applied:
The financial statements have been prepared on the going concern basis as the directors have a reasonable expectation that the company will continue in operational existence for the forseeable future.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts and value added tax. 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 company has transferred the significant risks and rewards of ownership to the buyer;
• the company 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 company 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 company 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 3
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
2.Accounting policies (continued)
Grants are accounted for under the accruals model as permitted by FRS 102.
Grants of a revenue nature are recognised in the Statement of Income and Retained Earnings in the same period as the related expenditure.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following bases:
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Short-term leasehold property
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Reducing balance over 3 years
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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.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
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.
The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received.
Page 4
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
2.Accounting policies (continued)
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Financial instruments (continued)
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However, if the arrangements of a short-term instrument constitute a financing transaction, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Income and Retained Earnings.
Short term creditors are measured at the transaction price. Other financial liabilities, including loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Foreign currency translation
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Functional and presentation currency
The company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
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.
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Operating leases: the company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Page 5
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
2.Accounting policies (continued)
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Leased assets: the company as lessee
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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.
The company has entered into a factoring arrangement for certain of its debts. Factored trade debtors are included in trade debtors and the proceeds received from the factor are included as payments on account in other creditors and are secured on the related debtors. Factoring charges are recognised as they accrue and are included within interest payable.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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The average monthly number of employees, including directors, during the year was 26 (2023 - 20).
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Page 6
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
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Short-term leasehold property
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Charge for the year on owned assets
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Charge for the year on financed assets
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Page 7
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
4.Tangible fixed assets (continued)
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The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:
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Finished goods and goods for resale
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Amounts owed by group undertakings
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Prepayments and accrued income
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Page 8
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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Secured Liabilities
Included within other creditors is an amount of £666,055 (2023: £621,729) on which security has been given by the company. This amount is secured by fixed and floating charges over the company's assets, as well as similar charges over the assets of other group companies.
See note 9 for details of the security on the bank loan.
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Creditors: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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Page 9
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts falling due 1-2 years
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Amounts falling due 2-5 years
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The company took out a Covid Business Interruption Loan (CBILS) on 20 July 2020 for £500,000 and agreed to a 6 year repayment term. The government has undertaken to pay any lender-levied fees plus the first year's interest charge for this type of loan. Repayments are £8,333 a month for 71 months (£99,996 per annum) and £8,334 for the final month. The loan carries a nominal interest rate of 4.9% above the Bank of England Base Rate with the first instalment falling due on 20 August 2021. The carrying amount at the year end is £208,341 (2023: £308,337). The bank loan is secured by way of fixed and floating charges over the assets of the company.
The company took out an additional Covid Business Interruption Loan (CBILS) on 21 January 2021 for £200,000 and agreed to a 5 year repayment term. The government has undertaken to pay any lender-levied fees plus the first year's interest charge for this type of loan. Repayments are £4,167 a month (£50,004 per annum). The loan carries a nominal interest rate of 4.9% above the Bank of England Base Rate with the first instalment falling due on 21 February 2022. The carrying amount at the year end is £79,159 (2023: £129,163). The bank loan is secured by way of fixed and floating charges over the assets of the company.
The company received an unsecured loan from a director on 6 March 2024 for £380,000 and agreed to a 1 year repayment term. Monthly interest is charged at 2.8% on the loan balance, and the capital is to be repaid on or before 6 March 2025.
The company received an additional loan from a director on 20 March 2024 for £175,000 and agreed to a 1 year repayment term. This loan is unsecured and interest free, and the capital is to be repaid on or before 20 March 2025.
The company received an additional loan from a director on 10 May 2024 for £200,000 and agreed to a 1 year repayment term. This loan is unsecured and interest free, and the capital is to be repaid on or before 10 May 2025.
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Page 10
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
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Hire purchase and finance leases
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Minimum lease payments under hire purchase fall due as follows:
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Allotted, called up and fully paid
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40,100 (2023 - 40,100) Ordinary shares of £1.00 each
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Commitments under operating leases
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At 30 June 2024 the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Page 11
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Energy Conservation Solutions Limited
Notes to the Financial Statements
For the Year Ended 30 June 2024
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Related party transactions
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During the year the company made the following related party transactions:
Directors
A director of the company has entered into a personal guarantee amounting to £50,000 (2023 - £50,000) in support of the company's banking facilities.
In addition, a director provided unsecured loans to the company during the year to the value of £755,000 (2023 - £199,999). At the balance sheet date, loan balances still outstanding amounted to £671,809 (2023 - £199,999); this liability is included within other loans. Interest of £50,325 (2023 - £12,383) was charged on the loans and the amount outstanding and included in accruals and deferred income at the balance sheet date was nil (2023 - £12,383).
Goji Group Limited
(Associate of ultimate parent company)
During the year, the company sold goods to Goji Group Limited totalling £14,544 (2023 - £15,200), and there was an outstanding balance held in trade debtors at the balance sheet date at a total of £6,556 (2023 - £2,885).
The company also purchased goods from Goji Group Limited in the year totalling £139,711 (2023 - £nil). There was no balance outstanding at the balance sheet date.
Finally, the company advanced multiple cash balances to Goji Group Limited in the year to be offset against future purchase invoices, such that there were payments on account at the year-end totalling £nil (2023 - £123,500); the prior year balance was included within other debtors.
The company has taken advantage of the exemption in Section 33.1A of FRS102 'Related Party Disclosures' from disclosing transactions with its parent company and other wholly owned members of the group.
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The company's immediate parent company is Energys Group Limited, incorporated in England and Wales. The company's ultimate parent company is Sky Shadow Limited, incorporated in the British Virgin Islands.
The ultimate controlling party is M Lau, by virtue of his majority shareholding in Sky Shadow Limited.
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