Company registration number 04707623 (England and Wales)
WE CLEAN LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2024
WE CLEAN LIMITED
COMPANY INFORMATION
Directors
Mr D J Harker
Mr P S Concannon
Company number
04707623
Registered office
Rubery House
The Avenue
Rubery
Birmingham
B45 9AL
Auditor
Sumer Auditco Limited
The Beehive
Beehive Ring Road
London Gatwick Airport
Gatwick
United Kingdom
RH6 0PA
WE CLEAN LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 25
WE CLEAN LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2024
- 1 -

The directors present the strategic report for the year ended 31 July 2024.

Review of the business

The results for the year are set out on page 8 onwards, showing significant growth from 2023. The directors consider the results achieved on ordinary activities before taxation to be acceptable.

Principal risks and uncertainties

Commercial Contract Cleaning Services is a resilient industry sector and although there is always an element of economic uncertainty we feel that the business is set up efficiently to take advantage of the market and continue to not only retain clients but also to grow organically its contractual base.

 

All of the company's sales are within the UK, which significantly reduces any foreign currency and exchange rate risks to an easily manageable level.

 

Future increases in national minimum wage and national insurance/pension contributions for the company's valued workforce could lead to increased costs and additional pressure on profit margins. The company looks to mitigate this risk by regularly reviewing their costings, and ensuring that all jobs are costed appropriately, factoring in these increases as and when they are in force.

Development and performance

In order to deal with the increase in demand, the company has increased the size of its workforce significantly, enabling more work to be carried out to the consistently high level expected by the company.

 

The company has no significant future plans which will change the way in which these services are delivered to our customers.

Key performance indicators

The key performance indicators below show the effect that continued growth has had on the business during 2024. As expected, turnover and gross profit are increasing as the business continues to expand and win new work from both new and existing clients.

 

 

2024

2023

Turnover

12,459,189

10,568,436

Gross profit margin

24.75%

25.07%

Operating profit margin

10.38%

10.85%

 

 

 

These key performance indicators show the company's significant growth over the last few years, while maintaining its profit margins. This has led to increased profits, and a continuously strengthening balance sheet net asset position.

On behalf of the board

Mr D J Harker
Director
25 March 2025
WE CLEAN LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2024
- 2 -

The directors present their annual report and financial statements for the year ended 31 July 2024.

Principal activities

The principal activity of the company continued to be that of contract cleaning.

Results and dividends

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £895,000. 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 D J Harker
Mr P S Concannon
Disabled persons

The company gives full consideration to applications for employment from disabled persons where the requirements of the job can be adequately fulfilled by a handicapped or disabled person. Where existing employees become disabled, it is the company's policy wherever practicable to provide continuing employment under normal terms and conditions and to provide training and career development and promotion to disabled employees wherever appropriate.

Employee involvement

The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

 

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.

 

There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.

Auditor

Sumer Auditco Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

WE CLEAN LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 3 -
Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the review of the business and the principal risks and uncertainties.

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.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr D J Harker
Mr P S Concannon
Director
Director
25 March 2025
WE CLEAN LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JULY 2024
- 4 -

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.

WE CLEAN LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF WE CLEAN LIMITED
- 5 -
Opinion

We have audited the financial statements of We Clean Limited (the 'company') for the year ended 31 July 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 Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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.

Opinions on other matters prescribed by the Companies Act 2006

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

WE CLEAN LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF WE CLEAN LIMITED (CONTINUED)
- 6 -
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. 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.

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. 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 CLEAN LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF WE CLEAN LIMITED (CONTINUED)
- 7 -

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 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.

Mr Martin Bradley FCCA (Senior Statutory Auditor)
For and on behalf of Sumer Auditco Limited, Statutory Auditor
Chartered Accountants
The Beehive
Beehive Ring Road
London Gatwick Airport
Gatwick
RH6 0PA
United Kingdom
28 March 2025
WE CLEAN LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JULY 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
12,459,189
10,568,436
Cost of sales
(9,375,786)
(7,919,143)
Gross profit
3,083,403
2,649,293
Administrative expenses
(1,799,914)
(1,511,718)
Other operating income
10,017
9,600
Operating profit
4
1,293,506
1,147,175
Interest receivable and similar income
8
4,945
1,325
Interest payable and similar expenses
9
(8,817)
(7,499)
Profit before taxation
1,289,634
1,141,001
Tax on profit
10
(334,843)
(259,722)
Profit for the financial year
954,791
881,279

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

WE CLEAN LIMITED
BALANCE SHEET
AS AT
31 JULY 2024
31 July 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
460,471
340,392
Current assets
Stocks
13
28,224
19,246
Debtors
14
1,289,617
1,043,946
Cash at bank and in hand
1,299,806
1,270,955
2,617,647
2,334,147
Creditors: amounts falling due within one year
15
(2,133,858)
(1,877,787)
Net current assets
483,789
456,360
Total assets less current liabilities
944,260
796,752
Creditors: amounts falling due after more than one year
16
(98,325)
(34,686)
Provisions for liabilities
Deferred tax liability
18
75,057
50,979
(75,057)
(50,979)
Net assets
770,878
711,087
Capital and reserves
Called up share capital
20
100
100
Profit and loss reserves
770,778
710,987
Total equity
770,878
711,087

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 25 March 2025 and are signed on its behalf by:
Mr D J Harker
Director
Company registration number 04707623 (England and Wales)
WE CLEAN LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2024
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 August 2022
100
660,708
660,808
Year ended 31 July 2023:
Profit and total comprehensive income
-
881,279
881,279
Dividends
11
-
(831,000)
(831,000)
Balance at 31 July 2023
100
710,987
711,087
Year ended 31 July 2024:
Profit and total comprehensive income
-
954,791
954,791
Dividends
11
-
(895,000)
(895,000)
Balance at 31 July 2024
100
770,778
770,878
WE CLEAN LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
1,527,609
1,557,094
Interest paid
(8,817)
(7,499)
Income taxes paid
(398,957)
(239,551)
Net cash inflow from operating activities
1,119,835
1,310,044
Investing activities
Purchase of tangible fixed assets
(108,044)
(155,133)
Proceeds from disposal of tangible fixed assets
7,465
417
Interest received
4,945
1,325
Net cash used in investing activities
(95,634)
(153,391)
Financing activities
Payment of finance leases obligations
(100,350)
(91,953)
Dividends paid
(895,000)
(831,000)
Net cash used in financing activities
(995,350)
(922,953)
Net increase in cash and cash equivalents
28,851
233,700
Cash and cash equivalents at beginning of year
1,270,955
1,037,255
Cash and cash equivalents at end of year
1,299,806
1,270,955
WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2024
- 12 -
1
Accounting policies
Company information

We Clean Limited is a private company limited by shares incorporated in England and Wales. The registered office is Rubery House, The Avenue, Rubery, Birmingham, B45 9AL.

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 under the historical cost convention, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

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. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

 

An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
1
Accounting policies
(Continued)
- 13 -

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:

Plant and machinery
25% straight line
Fixtures and fittings
25% straight line
Office equipment
25% straight line
Motor vehicles
25% straight line

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
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.6
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.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.7
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.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
1
Accounting policies
(Continued)
- 14 -
1.8
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.

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.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
1
Accounting policies
(Continued)
- 15 -
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.

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.

1.9
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.10
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.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
1
Accounting policies
(Continued)
- 16 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.11
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.

1.12
Retirement benefits

Contributions to defined contribution plans are recognised as an expense in the period in which

the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund.

 

When contributions are not expected to be settled wholly within 12 months of the end of the

reporting date in which the employees render the related service, the liability is measured on a

discounted present value basis. The unwinding of the discount is recognised as a finance cost in

profit or loss in the period in which it arises.

 

1.13
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.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
1
Accounting policies
(Continued)
- 17 -
1.14
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

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.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Useful lives of depreciable assets

The annual depreciation charge depends primarily on the estimated useful life of the asset and circumstances. The directors annually review the asset life and adjust as necessary to reflect current thinking on the remaining life in light of technological change, prospective economic utilisation and physical condition of the asset concerned. Changes in asset lives can have a significant impact on depreciation charges for the period. It is not practical to quantify the impact of changes to asset lives on an overall basis, as asset lives are individually determined. The total depreciation charged on the company's tangible assets for the year is £158,789 (2023: £131,738)

Revenue recognition for long term contracts

Where an item of revenue relates partly to both the current and future years, the directors are required to estimate the proportion of income which relates to the current year. This is done on a straight line basis, based on the number of working days in the current and future period, with the amount recognised in the current year calculated on a pro-rata basis. The net amount amount of income deferred into a future period is £124,597 (2023: £102,526), shown within accruals.

Wages reserve

Where a payroll period relates partly to both the current and future years, the directors are required to estimate the proportion of these payroll costs which relates to the current year. This is done on a straight line basis, based on the number of working days in the current and future period, with the amount recognised in the current year calculated on a pro-rata basis. The net amount amount of payroll costs reserved for in the current period is £259.416 (2023: £153.285), shown within accruals.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 18 -
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Provision of cleaning services
12,459,189
10,568,436
2024
2023
£
£
Other revenue
Interest income
4,945
1,325
Grants received
417
-
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Grants received
(417)
-
Depreciation of owned tangible fixed assets
136,861
130,068
Depreciation of tangible fixed assets held under finance leases
21,908
1,670
Profit on disposal of tangible fixed assets
(7,196)
(417)
Operating lease charges
45,644
42,707
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
19,000
-
0
6
Employees

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

2024
2023
Number
Number
690
579
WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
6
Employees
(Continued)
- 19 -

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
8,194,550
6,887,204
Social security costs
102,864
77,881
Pension costs
219,770
101,437
8,517,184
7,066,522
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
30,913
29,659
Company pension contributions to defined contribution schemes
90,000
-
120,913
29,659

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

8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
4,908
1,325
Other interest income
37
-
0
Total income
4,945
1,325
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
4,908
1,325
9
Interest payable and similar expenses
2024
2023
£
£
Other finance costs:
Interest on finance leases and hire purchase contracts
8,497
7,499
Other interest
320
-
0
8,817
7,499
WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 20 -
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
310,765
241,809
Deferred tax
Origination and reversal of timing differences
24,078
17,913
Total tax charge
334,843
259,722

From 1 April 2023, the tax rate in the UK increased from 19% to 25%. Therefore, the average tax rate for the year ending 31 July 2023 was 21.01%. For the year ending 31 July 2024, the tax rate used is 25%.

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
1,289,634
1,141,001
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 21.01%)
322,409
239,724
Tax effect of expenses that are not deductible in determining taxable profit
11,808
11,367
Permanent capital allowances in excess of depreciation
626
8,631
Taxation charge for the year
334,843
259,722
11
Dividends
2024
2023
£
£
Interim paid
895,000
831,000
WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 21 -
12
Tangible fixed assets
Plant and machinery
Fixtures and fittings
Office equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 August 2023
620,218
42,013
90,293
414,749
1,167,273
Additions
79,307
16,867
5,575
177,368
279,117
Disposals
(113,627)
(3,989)
(24,724)
(66,260)
(208,600)
At 31 July 2024
585,898
54,891
71,144
525,857
1,237,790
Depreciation and impairment
At 1 August 2023
452,961
33,044
76,969
263,907
826,881
Depreciation charged in the year
82,676
3,692
7,470
64,931
158,769
Eliminated in respect of disposals
(113,358)
(3,989)
(24,724)
(66,260)
(208,331)
At 31 July 2024
422,279
32,747
59,715
262,578
777,319
Carrying amount
At 31 July 2024
163,619
22,144
11,429
263,279
460,471
At 31 July 2023
167,257
8,969
13,324
150,842
340,392

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2024
2023
£
£
Motor vehicles
176,605
52,925
13
Stocks
2024
2023
£
£
Raw materials and consumables
28,224
19,246
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,245,550
1,022,348
Other debtors
-
0
2,701
Prepayments and accrued income
44,067
18,897
1,289,617
1,043,946
WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 22 -
15
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
17
74,890
67,806
Trade creditors
483,277
351,243
Corporation tax
153,617
241,809
Other taxation and social security
844,691
743,628
Other creditors
161,787
195,040
Accruals and deferred income
415,596
278,261
2,133,858
1,877,787
16
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
17
98,325
34,686

Total obligations under finance leases of £173,215 (2023 £102,492) are secured upon the assets to which they relate.

17
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
74,890
67,806
In two to five years
98,325
34,686
173,215
102,492

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.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 23 -
18
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
75,057
50,979
2024
Movements in the year:
£
Liability at 1 August 2023
50,979
Charge to profit or loss
24,078
Liability at 31 July 2024
75,057

Deferred tax liabilities of £41,697 are expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
219,770
101,437

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.

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 24 -
21
Operating lease commitments
Lessee

The total future minimum lease payments under finance leases and hire purchase contracts are which fall due as follows:

2024
2023
£
£
Within one year
38,451
57,638
Between two and five years
45,752
21,480
84,203
79,118
22
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2024
2023
2024
2023
£
£
£
£
Other related parties
71,637
45,076
897,935
751,532
2024
2023
Amounts due to related parties
£
£
Other related parties
119,838
112,612

The directors D Harker and P Concannon are minority shareholders of R Cleaning Limited with whom the company trades. All transactions with R Cleaning Limited are deemed to be at a normal market rate.

The following amounts were outstanding at the reporting end date:

2024
2023
Amounts due from related parties
£
£
Other related parties
18,968
3,223

The directors D Harker and P Concannon are minority shareholders of R Cleaning Limited with whom the company trades. All transactions with R Cleaning Limited are deemed to be at a normal market rate.

WE CLEAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 25 -
23
Cash generated from operations
2024
2023
£
£
Profit after taxation
954,791
881,279
Adjustments for:
Taxation charged
334,843
259,722
Finance costs
8,817
7,499
Investment income
(4,945)
(1,325)
Gain on disposal of tangible fixed assets
(7,196)
(417)
Depreciation and impairment of tangible fixed assets
158,769
131,738
Movements in working capital:
Increase in stocks
(8,978)
(4,263)
Increase in debtors
(245,671)
(32,837)
Increase in creditors
337,179
315,698
Cash generated from operations
1,527,609
1,557,094
24
Analysis of changes in net funds
1 August 2023
Cash flows
New finance leases
31 July 2024
£
£
£
£
Cash at bank and in hand
1,270,955
28,851
-
1,299,806
Obligations under finance leases
(102,492)
100,350
(171,073)
(173,215)
1,168,463
129,201
(171,073)
1,126,591
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