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Company No: 04785274 (England and Wales)

CHURCHILL RECOVERY SOLUTIONS LTD.

ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS
FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024
PAGES FOR FILING WITH THE REGISTRAR

CHURCHILL RECOVERY SOLUTIONS LTD.

ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024

Contents

CHURCHILL RECOVERY SOLUTIONS LTD.

COMPANY INFORMATION

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024
CHURCHILL RECOVERY SOLUTIONS LTD.

COMPANY INFORMATION (continued)

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024
DIRECTOR Mr J Chapman (Resigned 31 July 2024)
Mr I Rooney
REGISTERED OFFICE C/O Pm+M First Floor
Sandringham House
Hollins Brook Park
Pilsworth Road
Bury
BL9 8RN
United Kingdom
COMPANY NUMBER 04785274 (England and Wales)
CHARTERED ACCOUNTANTS PM+M Solutions for Business LLP
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
BB1 5QB
CHURCHILL RECOVERY SOLUTIONS LTD.

DIRECTOR'S REPORT

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024
CHURCHILL RECOVERY SOLUTIONS LTD.

DIRECTOR'S REPORT (continued)

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024

The director presents this annual report and the unaudited financial statements of the Company for the financial period ended 31 July 2024.

PRINCIPAL ACTIVITIES

The principal activity of the company continued to be that of debt recovery.

Business Performance

The financial period to 31 July 2024 has presented significant challenges due to the regulatory restrictions introduced by the industry regulator, OFGEM in February 2023. These restrictions, designed to protect vulnerable utility customers, have placed limitations on pre-disconnection and warrant-related activities across the sector. As a result, the company has faced a reduction in work volumes, directly impacting its core operations and revenues.

Despite these challenges, the company has prioritised resilience and long-term readiness. A strategic decision was made to retain staff throughout the period of reduced activity, ensuring that the company maintains its capacity to scale operations and meet demand efficiently when the restrictions are lifted. This commitment reflects the company’s focus on sustaining a skilled and experienced workforce, which is integral to delivering high-quality services.

Additionally, the company has made considerable investments in software and IT systems during this period. These advancements aim to enhance operational efficiency, streamline workflows, and enable more effective service delivery in the future. By leveraging technology, the company has positioned itself to operate more cost-effectively and adapt quickly to the evolving needs of its clients.

While overall profitability declined due to the regulatory restrictions and reduced activity levels, strategic cost management and investments in operational improvements have ensured the business remains stable. Furthermore, the company’s continued engagement with utility clients has reinforced its reputation as a reliable partner during challenging times.

Business Outlook

The regulatory restrictions have been lifted early in the 2025 period and the company remains cautiously optimistic about the future, recognising both the challenges and opportunities in the current regulatory environment. The company’s strategic decisions during this period have positioned it to capitalise on opportunities as they arise.

Looking ahead, the company’s key priorities include:
• Deploying Retained Workforce: Leveraging the retained and experienced workforce to rapidly scale operations and deliver high-quality services as restrictions ease, ensuring a seamless response to client needs.

• Maximising IT Investments: Harnessing the benefits of newly developed software and IT systems to drive efficiencies, reduce costs, and enhance service delivery.

• Expanding Service Offerings: Broadening the range of services provided to utility clients, to diversify revenue streams.

• Adapting to Regulatory Changes: Maintaining readiness to adjust operations swiftly in response to any changes in OFGEM’s policies and preparing for a return to pre-disconnection and warrant work at scale.

The company is confident that its proactive approach during this challenging period will yield long-term benefits. By retaining its workforce, investing in technology, and building operational resilience, the business is well-equipped to support its clients effectively and seize new opportunities as they emerge providing a strong foundation for future growth and success.

DIRECTOR

The directors, who served during the financial period and to the date of this report except as noted, were as follows:

Mr J Chapman (Resigned 31 July 2024)
Mr I Rooney

SMALL COMPANIES EXEMPTION

This Director's Report has been prepared in accordance with the provisions applicable to companies entitled to the small companies' exemption provided by section 415A of the Companies Act 2006.



Approved and signed by:

Mr I Rooney
Director

19 December 2024

CHURCHILL RECOVERY SOLUTIONS LTD.

BALANCE SHEET

AS AT 31 JULY 2024
CHURCHILL RECOVERY SOLUTIONS LTD.

BALANCE SHEET (continued)

AS AT 31 JULY 2024
Note 31.07.2024 31.01.2023
£ £
Fixed assets
Intangible assets 3 391,750 324,250
Tangible assets 4 30,766 42,236
422,516 366,486
Current assets
Stocks 0 36,956
Debtors 5 557,504 549,582
Cash at bank and in hand 170,156 31,892
727,660 618,430
Creditors: amounts falling due within one year 6 ( 1,398,375) ( 697,885)
Net current liabilities (670,715) (79,455)
Total assets less current liabilities (248,199) 287,031
Creditors: amounts falling due after more than one year 7 ( 133,185) ( 210,047)
Provision for liabilities 0 51,648
Net (liabilities)/assets ( 381,384) 128,632
Capital and reserves
Called-up share capital 100 100
Profit and loss account ( 381,484 ) 128,532
Total shareholders' (deficit)/funds ( 381,384) 128,632

For the financial period ending 31 July 2024 the Company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Director's responsibilities:

These financial statements have been prepared in accordance with the provisions of FRS 102 Section 1A – small entities. The financial statements of Churchill Recovery Solutions Ltd. (registered number: 04785274) were approved and authorised for issue by the Director on 19 December 2024. They were signed on its behalf by:

Mr I Rooney
Director
CHURCHILL RECOVERY SOLUTIONS LTD.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024
CHURCHILL RECOVERY SOLUTIONS LTD.

NOTES TO THE FINANCIAL STATEMENTS

FOR THE FINANCIAL PERIOD FROM 01 FEBRUARY 2023 TO 31 JULY 2024
1. Accounting policies

The principal accounting policies are summarised below. They have all been applied consistently throughout the financial period and to the preceding financial year, unless otherwise stated.

General information and basis of accounting

Churchill Recovery Solutions Ltd. (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is C/O Pm+M First Floor, Sandringham House, , Hollins Brook Park, Pilsworth Road, Bury, BL9 8RN, United Kingdom.

The financial statements have been prepared under the historical cost convention, modified to include certain items at fair value, and in accordance with Section 1A of Financial Reporting Standard 102 (FRS 102) ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ issued by the Financial Reporting Council and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime.

The financial statements are presented in pounds sterling which is the functional currency of the Company and rounded to the nearest £.

Going concern

The director has assessed the Balance Sheet, likely future cash flows arising from the pipeline of works and the available finance facilities at the date of approving these financial statements. The director has a reasonable expectation that the Company has adequate resources to continue in operational existence and to meet its financial obligations as they fall due for at least 12 months from the date of signing these financial statements. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Reporting period length

The financial statements are presented for a period longer than one year. As such, comparative amounts presented in the financial statements (including the related notes) are not entirely comparable.

Turnover

Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.

Turnover is stated net of VAT and trade discounts and is recognised when the significant risks and rewards are considered to have been transferred to the buyer. Turnover from the supply of services represents the value of services provided under contracts to the extent that there is a right to consideration and is recorded at the fair value of the consideration received or receivable. Where a contract has only been partially completed at the Balance Sheet date turnover represents the fair value of the service provided to date based on the stage of completion of the contract activity at the Balance Sheet date. Where payments are received from customers in advance of services provided, the amounts are recorded as deferred income and included as part of creditors due within one year.

Employee benefits

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

Defined contribution schemes
The Company operates a defined contribution scheme. The amount charged to the Statement of Income and Retained Earnings in respect of pension costs and other post-retirement benefits is the contributions payable in the financial period. Differences between contributions payable in the financial period and contributions actually paid are included as either accruals or prepayments in the Balance Sheet.

Taxation

Current tax
Current tax is provided at amounts expected to be paid (or recoverable) using the tax rates and laws that have been enacted or substantively enacted at the Balance Sheet date.

Deferred tax
Deferred tax arises as a result of including items of income and expenditure in taxation computations in periods different from those in which they are included in the Company's financial statements. Deferred tax is provided in full on timing differences which result in an obligation to pay more or less tax at a future date, at the average tax rates that are expected to apply when the timing differences reverse, based on current tax rates and laws. Deferred tax assets and liabilities are not discounted.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Intangible assets

Intangible assets are stated at cost or valuation, net of amortisation and any provision for impairment. Amortisation is provided on all intangible assets at rates to write off the cost or valuation of each asset over its expected useful life as follows:

Amortisation is not applied to assets in the developmental phase.

Development costs 10 years straight line
Other intangible assets

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

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

Tangible fixed assets

Tangible fixed assets are stated at cost or valuation, net of depreciation and any provision for impairment. Depreciation is provided on all tangible fixed assets, other than investment property and freehold land, at rates calculated to write off the cost or valuation, less estimated residual value, of each asset on a straight-line or reducing balance basis over its expected useful life, as follows:

Vehicles 25 % reducing balance
Office equipment 15 % reducing balance

Residual value represents the estimated amount which would currently be obtained from disposal of an asset, after deducting estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.

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.

Impairment of assets

Assets, other than those measured at fair value, are assessed for indicators of impairment at each Balance Sheet date. If there is objective evidence of impairment, an impairment loss is recognised in the Statement of Income and Retained Earnings as described below.

Stocks

Work in progress which is more than 25% complete is valued and the percentage profit recognised is dependent upon the percentage of completeness and the anticipated gross profit value of the case in progress.

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 creditors: amounts falling due within one year.

Financial instruments

Financial assets and financial liabilities are recognised when the Company becomes a 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.

Financial assets and liabilities are only offset in the Balance Sheet when, and only when there exists a legally enforceable right to set off the recognised amounts and the Company intends either 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.

Financial assets are derecognised when and only when the contractual rights to the cash flows from the financial asset expire or are settled, or the Company transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or the Company, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party.

Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

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.

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

Equity instruments
Equity instruments issued by the Company are recorded at the fair value of cash or other resources received or receivable, net of direct issue costs. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the Company.

Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

2. Employees

Period from
01.02.2023 to
31.07.2024
Year ended
31.01.2023
Number Number
Monthly average number of persons employed by the Company during the period, including the director 41 28

3. Intangible assets

Development costs Total
£ £
Cost
At 01 February 2023 324,250 324,250
Additions 67,500 67,500
At 31 July 2024 391,750 391,750
Accumulated amortisation
At 01 February 2023 0 0
At 31 July 2024 0 0
Net book value
At 31 July 2024 391,750 391,750
At 31 January 2023 324,250 324,250

4. Tangible assets

Vehicles Office equipment Total
£ £ £
Cost
At 01 February 2023 14,142 52,692 66,834
Additions 0 5,975 5,975
Disposals ( 14,142) 0 ( 14,142)
At 31 July 2024 0 58,667 58,667
Accumulated depreciation
At 01 February 2023 4,861 19,737 24,598
Charge for the financial period 3,190 8,164 11,354
Disposals ( 8,051) 0 ( 8,051)
At 31 July 2024 0 27,901 27,901
Net book value
At 31 July 2024 0 30,766 30,766
At 31 January 2023 9,281 32,955 42,236

5. Debtors

31.07.2024 31.01.2023
£ £
Trade debtors 407,552 321,530
Deferred tax asset 62,500 0
Other debtors 87,452 228,052
557,504 549,582

6. Creditors: amounts falling due within one year

31.07.2024 31.01.2023
£ £
Bank loans 112,005 58,496
Trade creditors 136,989 123,775
Other taxation and social security 479,595 172,395
Other creditors 669,786 343,219
1,398,375 697,885

Proceeds of invoice factoring debt of £306,391 (2023 - £196.298) are secured by the company.

7. Creditors: amounts falling due after more than one year

31.07.2024 31.01.2023
£ £
Bank loans 74,552 155,602
Other creditors 58,633 54,445
133,185 210,047

There are no amounts included above in respect of which any security has been given by the small entity.

8. Financial commitments

Commitments

31.07.2024 31.01.2023
£ £
Total future minimum lease payments under non-cancellable operating lease 64,643 85,717