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Company Registration Number SC717112
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GILSON GRAY FINANCIAL LIMITED
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GILSON GRAY FINANCIAL LIMITED
REGISTERED NUMBER: SC717112
STATEMENT OF FINANCIAL POSITION
AS AT 30 APRIL 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
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Alastair Lindsay
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Page 1
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GILSON GRAY FINANCIAL LIMITED
REGISTERED NUMBER: SC717112
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 30 APRIL 2024
The notes on pages 3 to 15 form part of these financial statements.
Page 2
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
Gilson Gray Financial Limited is a limited company incorporated and domiciled in Scotland.
The principal activity of the limited company is that of independent financial advisors.
On 15th August 2022 the trade and assets of fellow subsidiary Gilson Gray Financial Management LLP were transferred to Gilson Gray Financial Limited.
Gilson Gray Financial Limited operates from its registered office of 29 Rutland Square, Edinburgh,
EH1 2BW.
These financial statements have been presented in pounds sterling, rounded to the nearest pound, as this is the currency of the primary economic environment in which the entity operates.
Gilson Gray Financial Limited was incorporated on 8 December 2021. The comparatives presented relate to the period from the 1 August 2022 to 30 April 2023. The current period presented is from 1 May 2023 to 30 April 2024.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 following principal accounting policies have been applied:
In preparing these financial statements, the directors of the company have given careful consideration to current and anticipated future solvency requirements of the company and its ability to continue as a going concern for at least 12 months following the date of issue of these financial statements considering the company has net current liabilities of £2,841,766 as at 30 April 2024.
As part of this review, the directors have considered cashflow forecasts which show that the company will have sufficient funds, through its continued trading performance, available cash reserves and its available loan facilities to continue in operation for a period of at least 12 months from the date of issue of these financial statements. In addition, the directors are satisfied that should there be any additional funding required to meet the company’s obligations that the client contracts held within intangible fixed assets could be readily converted into additional funds for the business through a sale in an available market.
On this basis the directors continue to adopt the going concern basis in preparing its financial statements.
Page 3
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.
Page 4
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting 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 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 balances are 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 reporting date.
Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Statement of comprehensive income over its useful economic life.
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.
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.
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:
This represents a change in accounting estimate from the previous useful life of 25 years. Further disclosure is given in note 3.
Page 5
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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Impairment of fixed assets and goodwill
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Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.
Investments in subsidiaries are measured at cost less accumulated impairment.
Investments in listed company shares are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in profit or loss for the period.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Page 6
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Increases in provisions are generally charged as an expense to profit or loss.
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Judgments in applying accounting policies and key sources of estimation uncertainty
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The preparation of these financial statements require management to make judgments, estimates
and assumptions that affect the application of policies and reported amounts of assets and liabilities,
income and expenses.
Judgements and estimates are continually evaluated and are based on historical experiences and
other factors, including expectations of future events that are believed to be reasonable under the
circumstances.
The Company makes estimates and assumptions concerning the future. The resulting accounting
estimates will, by definition, seldom equal the related actual results. The estimates and assumptions
that have a significant risk of causing a material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below:
Valuation of acquired intangible assets in a business combination
As at 30 April 2024, the carrying value of acquired intangible assets was £12,113,930. The company's
intangible assets are initially measured at fair value in accordance with section 19 of FRS102, Business Combinations and Goodwill. Management has determined the appropriate valuation with reference to external valuations. In estimating the carrying value of the intangible assets management have engaged external providers for the valuation analysis, and these are based on the prevailing market, economic and other conditions at the date of the business combination. Valuation methodologies adopted in determining the fair value of intangibles include:
• Income method in determining the fair value of customer relationships and contracts and brands; and Information on the carrying values of intangible assets are disclosed in note 6.
Useful economic life of goodwill and customer contracts
The goodwill arising on acquisition is considered to be attributable to the potential recurring value of the customer base. The useful economic life is estimated to be 100 years.
This represents a change in accounting estimate. The change is being made following the application of new information and additional experience to the model management utilise to estimate the useful economic life of goodwill.
In order to calculate the useful economic life of the customer base management have estimated the remaining number of investment years of the acquired client portfolio.
This model has the following key inputs:
Page 7
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
3.Judgments in applying accounting policies (continued)
∙Retention rate of the client portfolio
∙Life expectancy for the United Kingdom population
∙Average age of wealth inheritance in the United Kingdom
∙Percentage of investors that retain the same advisor following an inheritance event
The retention rate of the client portfolio applied in the model is 95%. A retention rate of 87% would result in 25 investment years remaining and an annual amortisation charge of £542,166. A retention rate of 90% would result in 71 investment years remaining and an annual amortisation charge of £170,618. .
Impairment of goodwill
Intangible assets are tested for impairment annually, or more often if indicators of impairment exist. There are two key areas of estimation in relation to impairment.
The first is the appropriateness of the identified Cash Generating Units (CGU's) for the purpose of
impairment testing. A CGU is the smallest identifiable group of assets that generates cash inflows that are
largely independent of the cash inflows from other assets or group of assets. In identifying whether cash
inflows from an asset (or group of assets) are largely independent of the cash inflows from other assets
(or group of assets), management considers various factors including how management monitors the
entity's operations (such as by product, service lines or business geographical areas).
The other key area of estimation relates to the assumptions applied in calculating value in use of the
CGU's being tested for impairment. The key assumptions applied in the calculation relate to the future
performance expectations of the business - primarily, the Group's long-term growth rates. Assessment for
impairment involves comparing book value of an asset with its recoverable amount (being the higher of
value in use and fair value less costs to sell). Value in use determined with reference to projected future
cash flows discounted at an appropriate rate. Both the cash flows and the discount rate involve a
significant degree of estimation uncertainty.
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The average monthly number of employees, including directors, during the year was 32 (2023 - 10).
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Page 8
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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Charge for the year on owned assets
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Goodwill contains amounts in respect of amounts transferred from investments in subsidiaries as a result of a hive up on three subsidiaries acquired in the prior year.
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Page 9
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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Charge for the year on owned assets
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Page 10
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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Investments in subsidiary companies
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Page 11
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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The following are subsidiary undertakings of the Company:
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Sarah Hughes Wealth Management Ltd.
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29 Rutland Square, Edinburgh, Scotland, EH1 2BW
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R.S. Robertson & Co. (Pensions) & In) Ltd.
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2 West Marketgait, Dundee, Scotland, DD1 1QN
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Wallace Financial Planning Limited
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29 Rutland Square, Edinburgh, Scotland, EH1 2BW
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The Company acquired 100% of the share capital of the above noted companies in the year to 30 April 2024. The trade and assets of each company were subsequently hived up to Gilson Gray Financial Limited on completion of each acquisition at their fair value.
The residual value of the investments held by the company in the subsidiary entities after accounting for goodwill have been fully impaired as at 30 April 2024.
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Page 12
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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Prepayments and accrued income
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Other creditors includes an amount relating to deferred consideration of £2,220,830 (2023 - £565,599)
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Page 13
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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Creditors: Amounts falling due after more than one year
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts falling due 1-2 years
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Amounts falling due 2-5 years
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Amounts falling due after more than 5 years
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The company holds a series of loans which are unsecured. Interest is charged at a rate of 3.5% over the Bank of England base rate.
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The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £13,262 (2023 - £Nil) . Contributions totalling Nil (2023 - £Nil) were payable to the fund at the balance sheet date.
Page 14
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GILSON GRAY FINANCIAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
The controlling party, immediate parent entity and the smallest and largest group in which the results are consolidated in is Gilson Gray LLP. Copies of consolidated group financial statements can be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ.
The auditors' report on the financial statements for the year ended 30 April 2024 was unqualified.
The audit report was signed on 8 May 2025 by Huw Nicholls (Senior statutory auditor) on behalf of Armstrong Watson Audit Limited.
Page 15
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