Registered number:
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
CONTENTS
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BLICK ROTHENBERG LIMITED
COMPANY INFORMATION
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BLICK ROTHENBERG LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
The directors present their report and the financial statements for the year ended 30 June 2024.
The profit for the year, after taxation, amounted to £20.3m (2023 - £14.8m).
These figures exclude our associated audit practice revenues which are recorded in Blick Rothenberg Audit LLP and equate to £30.1m (2023: £22.4m). Combined revenues of Blick Rothenberg Limited and Blick Rothenberg Audit LLP are £106.9m (2023: £96.3m).
Dividend declared and paid for the year ended 30 June 2024 is £8.5m (2023: £nil). Post year-end T Hunter resigned as a director on 2 September 2024.
Consultation with our people or their representatives has continued at all levels, with the aim of ensuring that their views are taken into account when decisions are made that are likely to affect their interests and that all employees are aware of the financial and economic performance of their business units and of the Company as a whole. Communication continues through regular briefing of all our people at all levels, publications of articles on the Company’s intranet and holding of site-based update meetings.
During the year, we have implemented a Shadow Board comprised of colleagues across Blick Rothenberg to provide a sounding board for the Leadership Team (LT) on strategic issues, and to challenge and support the development of the firm’s strategy.
As permitted by Section 414c(11) of the Companies Act 2006, the directors have elected to disclose information, required to be in the director’s report by Schedule 7 of the “Large and Medium Sized Companies and Groups (Accounts and Reports) Regulations 2008”, in the strategic report.
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BLICK ROTHENBERG LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
The financial statements have been prepared on a going concern basis.
In making their assessment of going concern, the Directors have considered the Company's current and future prospects taking into consideration the current trading environment. The ongoing impact of the cost of living crisis within the UK has been considered and the impact of which is considered to be limited in terms of client failure on non-payment. As set out in note 2, the results of the base case scenario considered by the Directors in their assessment of going concern supports that the Company can continue to pay its liabilities as they fall due for the period ending 31 March 2026. Further in doing so, the Directors have obtained written confirmation from Azets Opco Limited that it will provide financial support to the Company for a period of 12 months from the approval of the financial statements to assist in meeting the Company's liabilities as and when they fall due to the extent that it is not available from its existing resources.
The auditor, Ernst & Young LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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BLICK ROTHENBERG LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2024
The directors are responsible for preparing the strategic report, the directors' 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 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 of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company 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 to 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.
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2024
The directors present their strategic report for the year ended 30 June 2024.
Blick Rothenberg Limited provides accounting, taxation and advisory services. It has a diverse UK corporate practice with a strong reputation for advising entrepreneurs, owner managed businesses and large international businesses along with a market leading inward investment practice supporting overseas businesses seeking to grow in the UK and beyond. The technically outstanding and client focussed private client practice delivers tailored proactive advice and solutions. Through its International Outsourcing division, it also delivers a leading multi-lingual financial outsourcing solution to UK businesses and those expanding internationally. Blick Rothenberg Audit LLP, an affiliated group company, provides audit and other regulated services to clients. Blick Rothenberg Limited provides infrastructure and staffing to Blick Rothenberg Audit LLP.
During the year to 30 June 2024 Blick Rothenberg Limited recorded turnover of £76.7m and an operating profit of £16.1m compared to £73.8m and £13.6m during the prior year. The key indicator of overall profitability is considered to be earnings before interest, tax, depreciation and amortisation margin (EBITDA margin %) which at 29.7% (2023: 27.5%) for the year under review was in line with the directors’ expectations.
Other key performance indicators focus on utilisation of our people and the recovery of chargeable time which are monitored and internally reported regularly. In addition, the directors monitor liquidity at least monthly by reviewing budgets and rolling cash flow forecasts. Working capital management is another key focus for management. Lockup, a measure of the days of sales in debtors and activity in work in progress, is reviewed monthly. Many of the key performance indicators monitored also include the audit business reflected in the financial statements of Blick Rothenberg Audit LLP.
The Company has performed well financially throughout the year. Including Blick Rothenberg LLP, we have seen strong growth in our revenues of 11% in the year and have invested heavily in our people to set us up for future growth in the coming year. Progress continues within our five pathway pillars being Ambitious growth, Talented Smart People, Personalised Client Service, Operational Excellence and Effective Technology.
Blick Rothenberg and its parent group, Azets, will continue to invest in both its people and technology to provide high quality, high value services to clients. On 31 October 2023, the Group announced that PAI Partners a pre-eminent private equity firm, has joined the business as a new investor of Azets. PAI hold a stake in Azets alongside Hg, a leading investor in European and transatlantic software and services businesses.
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
Financial risks
The Company has a broad and diversified client base. The Company’s credit risk is primarily attributable to its trade receivables. There is no significant concentration of credit risk, with exposure spread over many customers and market segments. The Company’s clients are invoiced in sterling and most of the Company’s suppliers are based in the UK so there is no significant foreign currency exposure in the Company. Lockup and liquidity are monitored and closely managed.
Recruitment and Retention of key people
The Company aims to retain its existing people whilst also attracting new hires through school leaver and graduate recruitment and strategic senior hires. The number of school leavers recruited in 2024 was 9 (2023: 9), and the number of graduates recruited in 2024 was 76 (2023: 42). Staff retention is actively managed through training, development and reward. Considerable senior management time is devoted to attracting new hires to help deliver growth and service new clients. Regular feedback is collected from colleagues at Blick Rothenberg through regular surveys and action plans are established by management.
Reputational risk
The directors place upmost emphasis on protecting the reputation of the business. Procedures are in place in relation to accepting new clients and engagements, review of professional standards in service delivery and compliance with relevant regulations including areas such as anti-money laundering and client money. Ongoing reviews of the engagement processes are undertaken to ensure that the business continues to mitigate reputational risks around new clients.
Data Capability and Management risk
The Company continues to focus on data as an asset and an enabler for growth. There is a newly created Data Governance Board at group level that the business engages with to monitor risks, opportunities and actions (including data cleansing activities).
Information / Cyber Security:
The Company is committed to maintaining security of its internal and client data. Information security risk and the risk of a cyber-attack (for example, malware, phishing, ransomware, denial of service) continues to feature as a key risk for the business. All of our people are required to complete a programme of mandatory cyber security training and will be trained as part of their induction. This training, along with ongoing communication and testing, supports awareness and their need to report potential issues; for example, phishing attacks have been spotted, reported and dealt with appropriately.
Macro Environment / Geo Political:
With macro-economic changes (high interest rates and inflation) and geo-political instability, the Company continues to monitor direct and indirect impacts and risk exposure. The Company continues to immediately disengage from any sanctioned individuals or businesses. At the date of signing these statements, the Directors of the firm continue to monitor the client base for risk and take appropriate action to mitigate that risk.
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
Section 172
The following describes how we have engaged with and considered the interests of our key stakeholders when exercising our duty to promote the success of the Company under section 172(1) of the Companies Act 2006.
These principles are driven by the leadership team and are embedded throughout the Blick Rothenberg business.
Our key stakeholders The Directors and leadership team are responsible for managing the business and the strategic success of the company. The Directors adopts the behavioural standards and values of the company in relation to all of its stakeholders.
The following section sets out the key stakeholder groups that we have and the ways that we engage with them to ensure we have a good understanding of their needs, their views and to ensure that the consequences of leadership decisions are thoroughly considered.
Our People
The Directors recognise that our people have a major part to play in the success of the company and is keen to ensure high levels of our people engagement. Regular and open feedback is obtained from all of our people through the “Your Voice” employee survey. Topics include wellbeing, job satisfaction, connection to the company, peer relationships and workload. The surveys are open throughout the company, but the results are filtered and made available to the managers of the company. People managers and senior leaders are actively encouraged to review scores and comments made in the survey, and then make positive changes. Generally we have continued to see improvement for people satisfaction since introducing Your Voice.
Consultation with our people or their representatives has continued at all levels, with the aim of ensuring that their views are taken into account when decisions are made that are likely to affect their interests and that all employees are aware of the financial and economic performance of their business units and of the Company as a whole.
Communication with all of our people continues through regular briefing at all levels (BRief), publications of articles on the Company’s intranet, holding of site-based update meetings and formal arrangements with recognised professional bodies.
The Directors recognise that it is important people feel able to raise concerns about conduct or ethical practices in a manner which they feel is safe and secure, a process which is aligned to the ICAEW regulated status of the company. We have encouraged a culture of openness and people are aware that they will be supported on any such issues. This is demonstrated through the various Employee Resource Groups in place such as our Women’s Network, our emBRace Network (Blick Rothenberg Acknowledges and Values Ethnicity), our Rainbow Network (LGBT+) and BRidge Network (inclusive Disability Group).
During the year, the Company has extended its two-way communication with its people with the formation of the Shadow Board. The Shadow Board is made of cross service representatives who work with the Leadership Team on certain people and other business matters. Group Stakeholders
As part of a group, the Directors consider the views of its parent and the interests of the group as part of any major decisions made by the company. There is an ongoing dialogue with the stakeholders on a range of subjects and regular meetings are held with relevant group individuals.
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
External & Community impacts
The company inevitably impacts the areas in which it works, both economically, bringing work to the region, and environmentally. Within this report is a separate Energy and Carbon report in relation to the environmental impact.
Charity initiatives are particularly popular across the company, with local, regional and national events regularly happening through the year with much engagement from people.
Our chosen charity of the year, The Connection at St Martins, received donations of circa £18,000 from our People and the Company during the period ending 30th June 2024. These donations were raised via numerous fundraising initiatives arranged by the firm's Charity Group. Clients
The company is committed to ensuring that all clients are treated fairly and that any conflicts of interest are highlighted and mitigated.
Our clients are obviously essential to our future and we strive to ensure that we maintain a high level of service to our clients and always strive to do the right thing. Any conflicts between staff and clients are managed via an internal self-reporting process that all staff are informed of. We ensure that our staff have adequate training and support to ensure that they are best placed to serve our clients.
Suppliers
The company carries out regular due diligence with new suppliers and existing ones, checking that slavery and human trafficking is not taking place in any of its supply chains or any part of its business. Suppliers are required to comply with the Modern Slavery Act. A centralised procurement function was established during the prior year as part of the group transformation. However, we also continue to use local businesses to supply goods and services. Local suppliers, where appropriate, are preferred and further work has been taken in the year to ensure we are working with ethically minded suppliers and those that hold similar principles to us.
We strive to ensure that our suppliers are also treated with respect and fairly to encourage a strong relationship.
Regulators
We seek to maintain a constructive and co-operative relationship with the bodies that authorise and regulate our business activities. This ensures that we strive to maintain a reputation for high standards of business conduct.
We always look to comply with all applicable laws and regulations and have put in place the right level of resource, controls and checks to ensure that we remain compliant. Any known breaches are, where appropriate, reported and dealt with in a timely manner.
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
Streamlined Energy and Carbon Reporting (SECR)
Company Information Blick Rothenberg, is a large enterprise, qualifying for SECR reporting with the number of employees in excess of 250, and a turnover in excess of £36m. The Company is incorporated in the UK under the name Blick Rothenberg Ltd, having Company number 10238654, with a registered address at 16 Great Queen Street, London, WC2B 5AH. The organisational boundary for the purposes of SECR reporting is the extent of financial control of the Company across the mandatory scope 1, 2 and 3 emissions. Environmental Intentions The company recognises the global challenges presented by climate change and is driven to continuously develop operations to reduce our impact on the environment. Environmental Approach During the last year, Blick Rothenberg has continued to probe opportunities to reduce emissions at the central office. This has included adjusting air conditioning to core hours rather than 24 hours, reducing screen saver timings, adding sensor taps in all kitchens and the introduction of more efficient photocopiers. The impact of these changes has meant that despite a 10% increase in staff numbers, office emissions are broadly the same as last year. In addition to our emission reductions, we have ensured that all electricity purchased is 100% renewable which will reduce our market based emissions for electricity down to zero. Finally, we have continued to invest in better data, installing water meters to monitor consumption and enhancing separation of our office waste to help recycling opportunities. We continue to work with an eco companion business, Pawprint, with the aim of continually identifying opportunities to become a more sustainable business.
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
Our Commitments:
In the year ahead, Blick Rothenberg will seek to drive the projects that have been successfully implemented over the last 12 months and continue to review operations and practices to identify further opportunities to minimise our impact on the environment.
Environmental Impact Reporting
The company’s greenhouse gas emissions and energy consumption is reported in tonnes of carbon dioxide equivalent (tCO2e) and is broken down as follows:
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BLICK ROTHENBERG LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
Assessment parameters
The methodology used to calculate the GHG emissions is in accordance with the requirements of the following standards: • World Resources Institute (WRI) Greenhouse Gas (GHG) Protocol (revised version). • Defra’s Environmental Reporting Guidelines: Streamlined Energy and Carbon Reporting Requirements (March 2019). • UK emissions have been calculated using the 2024 UK Government GHG Conversion Factors for Company Reporting. The organisational boundary covers all emissions where Blick Rothenberg have operational control. This SECR includes the statutory areas required under legislation and is location-based reporting. The reporting period is 1st July 2023 – 30th June 2024.
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BLICK ROTHENBERG LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF BLICK ROTHENBERG LIMITED
FOR THE YEAR ENDED 30 JUNE 2024
We have audited the financial statements of Blick Rothenberg Limited (the 'Company') for the year ended 30 June 2024, which comprise the profit and loss account, the balance sheet, the statement of changes in equity and the related notes 1 to 28, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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 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.
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.
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BLICK ROTHENBERG LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF BLICK ROTHENBERG LIMITED (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
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 this 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the 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 strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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.
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BLICK ROTHENBERG LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF BLICK ROTHENBERG LIMITED (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
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.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
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 obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are those that relate to the reporting framework, FRS 102, the Companies Act 2006, ICAEW regulations, Anti-money laundering legislation and the relevant tax laws and regulations in the UK. In addition, we concluded that there are certain significant laws and regulations which may have an effect on the determination of the amounts and disclosures in the financial statements relating to health and safety, employee matters and data protection.
∙We understood how the Company is complying with those frameworks by making enquiries of management and those charged with governance. We corroborated our enquiries through our review of board minutes and consideration of the results of our audit procedures across the Company.
∙We assessed the susceptibility of the company’s financial statements to material misstatement, including how fraud might occur by considering the risk of management override and by assuming revenue to be a fraud risk. We identified the value ascribed to the recognition and valuation of work-in-progress (WIP) which directly impacts revenue as a specific revenue recognition risk. As the most likely source of fraud, to address this risk we tested, on a sample basis, specific transactions impacting WIP to source documentation, performed procedures to validate the reasonableness of adjustments made to reflect the expected recovery of standard charge out rates, and performed procedures to validate the outcome of management’s review process to identify WIP in need of provision. This included discussions with a sample of non-finance personnel responsible for client engagements.
∙Based on this understanding we designed our audit procedures to identify noncompliance with such laws and regulations. Our procedures involved journal entry testing, with a focus on manual journals and journals indicating large or unusual transactions; enquiries of Company management; and challenging the assumptions and judgements made by management by reviewing third party evidence wherever possible. We also leveraged our data analytics platform in performing our work to assist in identifying higher risk transactions for testing. Compliance with other operational laws and regulations was covered through our inquiry with no indication of non-compliance identified.
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 auditor's report.
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BLICK ROTHENBERG LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF BLICK ROTHENBERG LIMITED (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
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.
for and on behalf of
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BLICK ROTHENBERG LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2024
*Adjusted EBITDA is earnings before interest, tax, depreciation and amortisation.
There are no items of other comprehensive income for either the current or prior year other than the profit for the year as noted above. Accordingly, no statement of other comprehensive income has been presented.
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BLICK ROTHENBERG LIMITED
BALANCE SHEET
AS AT 30 JUNE 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
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BLICK ROTHENBERG LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Blick Rothenberg Limited is a private Company limited by shares incorporated in England. The address of its registered office and principal place of business is 16 Great Queen Street, London, WC2B 5AH.
The financial statements are presented in Sterling (£).
2.Accounting policies
The financial statements have been prepared under the historical cost convention and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland ('FRS 102') 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 management to exercise judgment in applying the Company's accounting policies (see note 3). The Company was, at the end of the period, a wholly-owned subsidiary of Lynx Topco, a Company incorporated in Jersey, whose registered address is 44 Esplanade, St Helier, Jersey, JE4 9WG. In accordance with the exemption given in Section 401 of the Companies Act 2006, the Company is not required to produce, and has not published, consolidated accounts. The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102: • Section 3 Financial Statement Presentation paragraph 3.17(d) (inclusion of statement of cash flows); • Section 7 Statement of Cash Flows (inclusion of statement of cash flows); • Section 11 Financial Instruments paragraph 11.39 to 11.48A (disclosure relating to financial instruments); • Section 33 Related Party Disclosures paragraph 33.7 (disclosures of key management personnel compensation). The Company is included in the consolidated financial statements of Lynx Topco for the year ended 30 June 2024 and these financial statements may be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ. The following principal accounting policies have been applied:
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
The financial statements have been prepared on a going concern basis which the directors consider to be appropriate.
During the current financial year, the Company has continued to trade profitably with cash conversion in line with expectations. The Company has amounts owed to group undertakings of £7.2m which are repayable on demand. Subsequent to the balance sheet date, the directors of the counterparty companies have confirmed that they will not seek repayment of these loans prior to March 2026. As a result, the forecasts used by the Directors in their assessment of going concern do not include any repayment of principal or interest related to these loans. In assessing the going concern position of the Company for the year ended 30 June 2024, the Directors have considered the Company’s cash flows, liquidity and business activities over the period to 31 March 2026. In making their assessment, the Directors have considered impacts of the ongoing global conflicts and the cost of living crisis and general inflationary pressures on overheads on the cash flows and liquidity of the Company. The Company has a broad and diversified client base including corporate and individual clients, with no concentration of risk in any one particular sector and historically low client churn. The Directors consider that Blick Rothenberg will continue to grow during the review period. As a result of this, the base case scenario applied by the Directors in their assessment of going concern shows that the Company will have adequate resources to continue in operational existence for the period to 31 March 2026. The directors have also applied a downside scenario which assumes a 10% reduction in billings from the base case as well as a 10% reduction in cash collection rate. Further, in light of recent inflationary pressures on costs an additional 6% growth in overhead costs beyond increases in the base case has been applied. In this scenario, the Company would be able to meet its obligations. This scenario would mean a contraction from the current financial year and therefore considered a prudent position. In making their going concern assessment, the Directors have also obtained written confirmation from Azets Opco Limited that it will provide financial support to the Company for a period of at least 12 months from the approval of the financial statements to assist in meeting the Company’s liabilities as and when they fall due to the extent that it is not available from its existing resources. In making their assessment of going concern of the Group, the Directors of Azets Opco Limited ("the Group directors") have reviewed both the liquidity of the Group and its ability to comply with the financial covenant in both a base case and a downside scenario. The base case scenario applied by the Group Directors in their assessment of going concern shows that the Group will have adequate resources to continue in operational existence for the period under review and will meet its financial covenant during that period. The Group Directors have also considered what they believe to be a severe but plausible downside scenario being a 10% reduction in pro-forma EBITDA compared to pro forma EBTIDA generated in the year ended 30 June 2024. This scenario shows that the Group would continue to meet its financial covenant and meet its liabilities as they fall due for the period to 31 March 2026. For these reasons, the Directors continue to believe that it is appropriate to adopt a going concern basis for the preparation of the financial statements.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Tangible fixed assets 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.
At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following bases:
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 period.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the profit and loss account.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
The Company has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.
Financial assets and financial liabilities are recognised when the Company becomes party to the contractual provisions of the instrument. 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. The Company’s policies for its major classes of financial assets and financial liabilities are set out below. Financial assets Basic financial assets, including trade and other debtors, cash and bank balances and balances with fellow group entities are initially recognised at transaction price, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate. Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment. Financial liabilities Basic financial liabilities, including trade and other creditors and balances with fellow group companies are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Impairment of financial assets
Financial assets 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 profit and loss account. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the Company would receive for the asset if it were to be sold at the reporting date. For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. 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 and financial liabilities Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions. Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires. Offsetting of financial assets and financial liabilities Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss account within 'interest receivable and similar income or interest payable and similar expenses'. All other foreign exchange gains and losses are presented in the profit and loss account within 'administrative expenses'.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Company keeping the scheme open or the employee maintaining any contributions required by the scheme). Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period. Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Current tax is the amount of income tax payable in respect of taxable profit for the period. The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income. Deferred tax arises from timing differences that are differences between taxable profits and total comprehensive income as stated in the financial statements. These timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements. Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that: • The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of the 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 is not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Revenue recognition Other than for assignments undertaken on a contingent fee basis, revenue on client assignments is recognised over time. This requires management to determine the measurement method that best depicts the Company's performance in transferring services to its clients. Management has concluded that the input method of measuring progress is appropriate based on the time and external costs incurred to date as a percentage of total expected time and external costs. This requires an estimate to be made of the stage of completion of those assignments. Management estimates the remaining time and external costs to be incurred in completing the assignments and the client's willingness and ability to pay for the services provided. A different assessment of the outturn on an assignment may result in a different value being determined for revenue and a different carrying value being determined for unbilled revenue for client work. Unbilled revenue as at 30 June 2024 was £9.3 million (2023: £10 million), given that this has not yet been billed with the clients, there remains a risk that elements of this balance are not billable and so will not be recovered in cash.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
The whole of the turnover is attributable to the Company's principal activity.
Analysis of turnover by country of destination:
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
11.Taxation (continued)
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Page 33
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Page 36
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Profit and loss account
The Company has taken advantage of the exemption contained in FRS 102 section 33 "Related Party Disclosures" from disclosing transactions with entities which are a wholly owned part of the group.
During the year, costs of £27.7m (2023: £21.5m) were recharged to Blick Rothenberg Audit LLP, an associated group entity, and at the year-end £1.4m (2023: £0.6m) was due from Blick Rothenberg Audit LLP, which is unsecured, bears no interest and is repayable on demand.
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BLICK ROTHENBERG LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
On 1 September 2023 a related company, Azets Ireland Holdings Limited, entered into a lease with a third party, and BR Limited is named as guarantor for this transaction. The maximum liability that could arise to the company, in the event of a default on the lease payments, is £3.1m, though it is not anticipated that the guarantee will actually be exercised.
Post year end, a related Group company entered into a 2 year Utility Contract, and BR Limited is named as guarantor of this transaction. The maximum liability that could arise to the company, in the event of default on the Utility payments, is £1.1m, though it is not anticipated that the guarantee will actually be exercised.
The immediate parent Company is Azets BR Bidco Limited, a Company registered in Jersey.
The parent Company of the largest group of undertakings for which consolidated financial statements are drawn up and of which the Company is a member is Lynx Topco Limited, a Company incorporated in Jersey, whose registered address is 44 Esplanade, St Helier, Jersey, JE4 9WG. Copies of the group financial statements are available from Companies House, Crown Way, Cardiff, CF14 3UZ. In the opinion of the directors the immediate controlling party is Azets BR Bidco Limited. There is no ultimate controlling party.
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