Registration number:
Fareham Associates Limited
for the Year Ended 30 September 2024
Fareham Associates Limited
Contents
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Company Information |
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Strategic Report |
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Directors' Report |
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Statement of Directors' Responsibilities |
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Independent Auditor's Report |
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Consolidated Profit and Loss Account |
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Consolidated Balance Sheet |
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Balance Sheet |
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Consolidated Statement of Changes in Equity |
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Statement of Changes in Equity |
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Consolidated Statement of Cash Flows |
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Notes to the Financial Statements |
Fareham Associates Limited
Company Information
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Directors |
G Gaunt A G Roberts |
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Registered office |
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Auditors |
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Fareham Associates Limited
Strategic Report for the Year Ended 30 September 2024
The directors present their strategic report for the year ended 30 September 2024.
Principal activity
The principal activity of the group is building construction, civils and maintenance for a wide range of commercial and public clients.
Fair review of the business
MPH Construction Ltd is a well-established construction company based in Mold, North Wales serving its clients throughout Wales, North of England and the Midlands.
Our team of employees are passionate about quality for its customers in all sectors including maintenance, education, leisure, industrial, commercial, aeronautical, pharmaceutical, health, nuclear, blue light, utilities and rail. The business continues to invest in its people, infrastructure, and systems.
We are pleased to say that the group has performed well during the period and strengthen our position with our key clients. Operational delivery remained strong, with many clients appreciating our approach to productivity and programme. The trading conditions faced by the group remained competitive throughout the year. Rising interest rates, volatile energy prices and changes introduced by the new government. The financial resilience of the group, our supply chains and the strength of those relationships has helped protect the group and our clients from any significant impact.
The group’s overall financial and business performances has seen an increase in turnover. Over the year to 30 September 2024, the group’s turnover was £42,894,564 representing an increase in turnover of £14,143,837. The gross profit margin has increased to £7,666,381 (2023 - £6,182,037) as compared to the previous year.
Key performance indicators
The Directors and Senior Managers, who are the key management, use financial measures such as profitability, turnover and level of secured workload to monitor performance as these are considered to be the main drivers of the group’s continued success. Turnover and profitability are measured in the same basis as that seen in the profit and loss account.
We also consider non-financial measures, such as the ongoing monitoring of our safety scores, review of customer satisfaction levels and satisfaction of our employees.
The company's key financial and other performance indicators during the year were as follows:
|
Financial KPIs |
Unit |
2024 |
2023 |
|
Turnover |
£ |
42,894,564 |
28,750,727 |
|
Gross Profit |
£ |
7,666,381 |
6,182,037 |
|
Net asset |
£ |
8,456,686 |
4,747,624 |
|
Gross profit margin |
% |
18 |
21 |
Fareham Associates Limited
Strategic Report for the Year Ended 30 September 2024
Principal risks and uncertainties
The Board is responsible for the group's risk management and internal controls to ensure that significant risks are identified and managed appropriately.
The principal risks and uncertainties facing the group going forward are:
• High levels of inflation, interest rates and energy costs.
• The availability of capital budgets to customers.
• The increased potential for failures in our supply chain.
• Changes in the outlook for the UK economy.
• The availability of sufficient skilled people.
• The effect of heightened global tensions on the economy and supply chains.
• The inflation risk associated with delivering fixed price contracts.
• The health and safety of our people in challenging operating environments.
The Board is confident that these risk and uncertainties area appropriately managed and mitigated by the group’s strategies, procedures and commercial arrangements.
Additional risks which the business faces include but not limited to are as follows:
• Regulatory and compliance obligations.
• Legal risks resulting from contracts with customers and suppliers.
• Information technology risks especially with cybercrime increasing and becoming more sophisticated.
• The credit risk of completing works ahead of being paid.
• Competition in securing contracts and frameworks.
• Contract management.
Fareham Associates Limited
Strategic Report for the Year Ended 30 September 2024
Future Outlook
Our business strategy continues to hold our employees as our biggest asset. The dedication and performance of our employees is at the heart of the development and growth of our business.
We will continue to focus on the following:
• The health, safety and wellbeing of our employees and supply chain.
• Maintain growth and operational improvement in markets in which we are more suited to operate within, whilst avoiding one off clients.
• Continue to establish ourselves in our core sectors and maintain our position on several frameworks.
• Continue to provide our clients with a highly focused approach and ‘can do’ attitude.
• Prioritise our responsibility to develop our processes to combat climate change and ensure that our business sustainable strategy continues to be at the heart of our development and growth.
• Improving efficiency and productivity.
• The management of inflation risk.
• Supporting people through the cost-of-living crisis.
• Impact of the Building Safety Act 2022.
• High satisfaction levels and customer loyalty.
• Selectivity with our client base, in order to minimise any risk to the business and provide a respective level of overhead and profitability contribution.
The construction industry remains a very competitive market, we have responded remarkably well to the challenge so far, our business strategy will need to adapt to meet the changes in the environment we work and the needs of our clients.
Our forward order book for 2025 - 2026 remains strong, which provides us with stability for the forthcoming years.
Approved by the
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Fareham Associates Limited
Directors' Report for the Year Ended 30 September 2024
The directors present their report and the for the year ended 30 September 2024.
Directors of the group
The directors who held office during the year were as follows:
Dividends
The dividends proposed and paid during the year ended 30 September 2024 amounted to £930,000 (2023 - £2,490,000).
Financial instruments
Objectives and policies
The Board is responsible for the Group’s financial instruments to ensure that significant risks are identified and managed appropriately. As the group’s trade is that of construction services and maintenance there is an inherent risk to the business, and it would not be possible to eliminate these risks and uncertainties however the group identifies risks and manages them as best as it can.
Price risk, credit risk, liquidity risk, cash flow risk and foreign currency risk
The group operates in a competitive industry and manages this risk through investment in personnel and reputation to be able to provide a superior service and retain revenue from existing clients as well as securing new business.
There is exposure to credit risk from sales and the group reviews the risk profile for all new customers carefully. Whilst there are bad debts this year and in the prior year these form a very small proportion of overall sales. The group monitors all clients on an ongoing basis to assess any potential credit risk that may arise.
Liquidity risk is considered low in this business as there are surplus cash reserves and the net current assets are positive. The group will ensure that the working capital requirements are met adequately and plan projects according to the funding available.
The group finances its operations through a mixture of retained profits and cash balances to maintain its cashflow risk.
Foreign currency risk is considered to be low as the vast majority of trading in the group for customers and suppliers are done in GBP. The group will continue to assess this situation and seek to mitigate risks of foreign currency should the need arise.
Charitable donations
The group made charitable donations of £1,635 during the year to Just giving and various charities.
Fareham Associates Limited
Directors' Report for the Year Ended 30 September 2024
Matters covered in the Strategic Report
The group’s future developments are mentioned in the Strategic Report.
Reappointment of auditors
The auditors, Richlands Business Advisers Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
Post Balance Sheet Events
There have been no significant events affecting the group since the year end.
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor are unaware.
Approved by the
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Fareham Associates Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities for preparing the Annual Report and the group and parent company financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare group and parent company financial statements for each financial year. Under that law the directors have elected to prepare the group and parent company 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 group and parent company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
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select suitable accounting policies and apply them consistently; |
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make judgements and accounting estimates that are reasonable and prudent; |
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prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Fareham Associates Limited
Independent Auditor's Report to the Members of Fareham Associates Limited
Opinion
We have audited the financial statements of Fareham Associates Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2024, which comprise the Consolidated Profit and Loss Account, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
• | give a true and fair view of the state of the group’s and of the parent company's affairs as at 30 September 2024 and of the group's profit for the year then ended; |
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
• | have been prepared in accordance with the requirements of the Companies Act 2006. |
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 responsibilities for the audit of the financial statements section of our report. We are independent of the group and the parent 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 director's 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 group's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
In connection with our audit of the financial statements, 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.
Fareham Associates Limited
Independent Auditor's Report to the Members of Fareham Associates Limited
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
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the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report and the Directors' Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• | adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
• | the parent company financial statements are not in agreement with the accounting records and returns; or |
• | certain disclosures of directors' remuneration specified by law are not made; or |
• | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities as set out on page 7, 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 group's and the parent 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 group or parent company or to cease operations, or have no realistic alternative but to do so.
Auditor 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.
Fareham Associates Limited
Independent Auditor's Report to the Members of Fareham Associates Limited
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Based on our understanding of the group and industry, we identified that the principal risks of non-compliance with laws and regulations related to the UK tax legislation and breaches of health and safety, and we considered the extent to which non-compliance might have a material effect on the financial statements.
We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting inappropriate journal entries, and management bias in accounting estimates. Audit procedures performed by us included:
- discussion with management including consideration of known or suspected instances of non-compliance with laws and regulation and fraud;
- assessment of matters reported on the company's health and safety audit and the results of management's action on the findings;
- challenging assumptions made by management in their significant accounting estimates;
- identifying and testing journal entries.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: 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.
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For and on behalf of
Chartered Accountants and Statutory Auditor
42-46 Station Road
Middlesex
HA8 7AB
Fareham Associates Limited
Consolidated Profit and Loss Account for the Year Ended 30 September 2024
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Note |
2024 |
2023 |
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|
Turnover |
|
|
|
|
Cost of sales |
( |
( |
|
|
Gross profit |
|
|
|
|
Administrative expenses |
( |
( |
|
|
Other operating income |
|
|
|
|
Operating profit |
|
|
|
|
Other interest receivable and similar income |
|
|
|
|
Interest payable and similar expenses |
( |
( |
|
|
22,198 |
(3,975) |
||
|
Profit before tax |
|
|
|
|
Tax on profit |
( |
( |
|
|
Profit for the financial year |
|
|
|
|
Profit/(loss) attributable to: |
|||
|
Owners of the company |
|
|
|
|
Minority interests |
|
|
|
|
|
|
The group has no recognised gains or losses for the year other than the results above.
Fareham Associates Limited
(Registration number: 08837699)
Consolidated Balance Sheet as at 30 September 2024
|
Note |
2024 |
2023 |
|
|
Fixed assets |
|||
|
Tangible assets |
|
|
|
|
Other financial assets |
2,200 |
2,200 |
|
|
|
|
||
|
Current assets |
|||
|
Debtors |
|
|
|
|
Cash at bank and in hand |
|
|
|
|
|
|
||
|
Creditors: Amounts falling due within one year |
( |
( |
|
|
Net current assets |
|
|
|
|
Total assets less current liabilities |
|
|
|
|
Creditors: Amounts falling due after more than one year |
( |
- |
|
|
Provisions for liabilities |
( |
( |
|
|
Net assets |
|
|
|
|
Capital and reserves |
|||
|
Called up share capital |
30 |
30 |
|
|
Retained earnings |
7,866,643 |
4,416,338 |
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|
Equity attributable to owners of the company |
7,866,673 |
4,416,368 |
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Minority interests |
590,013 |
331,241 |
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Shareholders' funds |
8,456,686 |
4,747,609 |
Approved and authorised by the
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Fareham Associates Limited
(Registration number: 08837699)
Balance Sheet as at 30 September 2024
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Note |
2024 |
2023 |
|
|
Fixed assets |
|||
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Investments |
|
|
|
|
Current assets |
|||
|
Debtors |
- |
|
|
|
Creditors: Amounts falling due within one year |
- |
( |
|
|
Net current liabilities |
- |
( |
|
|
Net assets |
|
|
|
|
Capital and reserves |
|||
|
Called up share capital |
30 |
30 |
|
|
Retained earnings |
970 |
954 |
|
|
Shareholders' funds |
1,000 |
984 |
The company made a profit after tax for the financial year of £930,016 (2023 - profit of £2,490,000).
Approved and authorised by the
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Fareham Associates Limited
Consolidated Statement of Changes in Equity for the Year Ended 30 September 2024
Equity attributable to the parent company
|
Share capital |
Profit and loss account
|
Total |
Non-controlling interests |
Total equity |
|
|
At 1 October 2023 |
|
|
|
|
|
|
Profit for the year |
- |
|
|
|
|
|
Dividends |
- |
( |
( |
( |
( |
|
At 30 September 2024 |
|
|
|
|
|
|
Share capital |
Profit and loss account |
Total |
Non- controlling interests |
Total equity |
|
|
At 1 October 2022 |
|
|
|
|
|
|
Profit for the year |
- |
|
|
|
|
|
Total comprehensive income |
- |
|
|
|
|
|
Dividends |
- |
( |
( |
( |
( |
|
At 30 September 2023 |
|
|
|
|
|
Fareham Associates Limited
Statement of Changes in Equity for the Year Ended 30 September 2024
|
Share capital |
Retained earnings |
Total |
|
|
At 1 October 2023 |
|
|
|
|
Profit for the year |
- |
|
|
|
Dividends |
- |
( |
( |
|
At 30 September 2024 |
|
|
|
|
Share capital |
Retained earnings |
Total |
|
|
At 1 October 2022 |
|
|
|
|
Profit for the year |
- |
|
|
|
Dividends |
- |
( |
( |
|
At 30 September 2023 |
30 |
954 |
984 |
Fareham Associates Limited
Consolidated Statement of Cash Flows for the Year Ended 30 September 2024
|
Note |
2024 |
2023 |
|
|
Cash flows from operating activities |
|||
|
Profit for the year |
|
|
|
|
Adjustments to cash flows from non-cash items |
|||
|
Depreciation and amortisation |
|
|
|
|
Profit on disposal of tangible assets |
( |
- |
|
|
Finance income |
( |
( |
|
|
Finance costs |
|
|
|
|
Income tax expense |
|
|
|
|
|
|
||
|
Working capital adjustments |
|||
|
Decrease/(increase) in trade debtors |
|
( |
|
|
Increase in trade creditors |
|
|
|
|
Decrease in provisions |
( |
- |
|
|
(Decrease)/increase in deferred income, including government grants |
( |
|
|
|
Cash generated from operations |
|
|
|
|
Income taxes paid |
( |
( |
|
|
Net cash flow from operating activities |
|
|
|
|
Cash flows from investing activities |
|||
|
Interest received |
|
|
|
|
Acquisitions of tangible assets |
( |
( |
|
|
Proceeds from sale of tangible assets |
|
- |
|
|
Net cash flows from investing activities |
( |
( |
|
|
Cash flows from financing activities |
|||
|
Interest paid |
( |
( |
|
|
Payments to finance lease creditors |
|
- |
|
|
Dividends paid |
( |
( |
|
|
Payment to minority interest - dividends |
(69,750) |
(186,750) |
|
|
Net cash flows from financing activities |
( |
( |
|
|
Net increase in cash and cash equivalents |
|
|
|
|
Cash and cash equivalents at 1 October |
|
|
|
|
Cash and cash equivalents at 30 September |
8,756,937 |
4,634,093 |
|
Analysis of net debt
The opening cash and cash equivalents at 1 October 2023 was £4,634,093. The cashflow for the entity amounted to £4,122,844 resulted in the closing cash and cash equivalents at 30 September 2024 of £8,756,937.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
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General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
United Kingdom
These financial statements were authorised for issue by the
|
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
Summary of disclosure exemptions
The parent company has taken advantage of omitting its individual Statement of Cash Flows being a qualifying entity preparing consolidated accounts.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 30 September 2024.
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
Judgements
The judgements made by the directors, in the application of the accounting policies and key sources of estimation uncertainty were as follows: |
Depreciation- Depreciation is provided in accordance with the policies set however the actual wear and tear of the assets may vary. |
Cost Accruals - A provision for the cost accruals is established on the basis of work done on project and what is not yet invoiced. The amount includes an estimation of the cost to complete a project, which may differ from the actual costs incurred on completion. |
Amounts recoverable on contracts - A provision for amounts recoverable on contracts is estimated on the basis of the on going projects and work done. It may differ from the actual costs incurred on completion of a project. The estimation is also dependant on the management team's assessment of the profit margin achievable on the contracts. |
Impairment of Trade debtors - A provision for the impairment of trade debtors is established on the nature, age and recoverability of all debtors and the recoverables on projects are reviewed regularly by directors and provisions are made where appropriate. |
Provisions and contingent consideration - The recognition and measurement of provisions and contingent consideration requires management judgement to assess the likelihood and magnitude of any future outflows. |
Consistent measures and procedures are in place to ensure that estimates are applied and results are determined on a consistent basis. |
Provision for dilapidation- Dilapidation provision is provided by the management on the basis of an estimation of the expenditure that will be incurred based on contractual requirements. |
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the provision of services in the ordinary course of the group’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.
The group recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the group's activities.
Contract revenue recognition
The group applies revenue recognition applicable in the construction business stream. Revenue is recognised when it transfers control over a product or service to its customer. Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties.
Revenue is recognised as follows:
– revenue from construction and services activities is recognised over time and the group uses the input method to measure progress of delivery
– The consideration recognised is the amount which is highly probable not to result in a significant reversal in future periods.
Presentational currency
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
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 group operates and generates taxable income.
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
|
Asset class |
Depreciation method and rate |
|
Furniture, fittings and equipments |
20% on reducing balance |
|
Motor vehicles |
25% on reducing balance |
Business combinations
Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.
Investments
Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
Trade debtors
Trade debtors are amounts due from customers for services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the receivables.
Amounts recoverable on contracts
Amount recoverable on contracts represents the net amount due from customers from contract work performed to date under construction contracts, where the value of work completed, including attributable profit, exceeds progress billings. The group represents the right to consideration in exchange for goods and services that have been transferred to the customer.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Provisions
Provisions are recognised when the group has an obligation at the reporting date as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
Dividends
Dividend distribution to the group’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
Financial instruments
Classification
from related parties.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other debtors and creditors, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method.
Debt instruments that are payable or receivable within one year, typically trade creditors or debtors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration, expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms of financed at a rate of interest that is not a market rate or in case of an out-right short term loan not at a market rate, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.
Non-derivative financial instruments that are equity of the issuer are equity instruments.
Recognition and measurement
Equity instruments are initially measured at cost and the movement at the balance sheet date based on the fair value shall be adjusted to the profit and loss account.
Impairment
For financial assets measured as cost less impairment, the impairment loss is measured as the difference between an asset’s carrying amount and best estimate, which is an approximation of the amount that the company would receive for the asset if it were to be sold at the balance sheet date.
Financial assets and liabilities are offset and the net amount reported in the Balance sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Revenue |
The analysis of the group's revenue for the year from continuing operations is as follows:
|
2024 |
2023 |
|
|
Sales |
|
|
The analysis of the group's Turnover for the year by market is as follows:
|
2024 |
2023 |
|
|
United Kingdom |
|
|
|
Other operating income |
The analysis of the group's other operating income for the year is as follows:
|
2024 |
2023 |
|
|
Government grants |
|
|
|
Sub lease rental income |
|
|
|
|
|
|
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
|
2024 |
2023 |
|
|
Wages and salaries |
|
|
|
Social security costs |
|
|
|
Pension costs, defined contribution scheme |
|
|
|
Other employee expense |
|
|
|
|
|
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:
|
2024 |
2023 |
|
|
Administration and support |
|
|
|
Construction services |
|
|
|
|
|
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
|
2024 |
2023 |
|
|
Remuneration |
|
|
|
Contributions paid to money purchase schemes |
|
|
|
262,361 |
254,295 |
In respect of the highest paid director:
|
2024 |
2023 |
|
|
Remuneration |
|
|
|
Company contributions to money purchase pension schemes |
|
|
|
Auditors' remuneration |
|
2024 |
2023 |
|
|
Audit of these financial statements |
21,394 |
23,606 |
The audit fees for the year 2024 is £20,750 and the remaining £1,394 accounts for underprovisions made in respect of audit fees in prior financial periods.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Taxation |
Tax charged/(credited) in the consolidated profit and loss account
|
2024 |
2023 |
|
|
Current taxation |
||
|
UK corporation tax |
|
|
|
Deferred taxation |
||
|
Arising from origination and reversal of timing differences |
|
|
|
Tax expense in the income statement |
|
|
The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2023 - lower than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
|
2024 |
2023 |
|
|
Profit before tax |
|
|
|
Corporation tax at standard rate |
|
|
|
Tax decrease from effect of capital allowances and depreciation |
( |
( |
|
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
|
Deferred tax expense from unrecognised temporary difference from a prior period |
|
|
|
Total tax charge |
|
|
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Tangible assets |
Group
|
Furniture, fittings and equipment |
Motor vehicles |
Total |
|
|
Cost or valuation |
|||
|
At 1 October 2023 |
|
|
|
|
Additions |
|
|
|
|
Disposals |
- |
( |
( |
|
At 30 September 2024 |
|
|
|
|
Depreciation |
|||
|
At 1 October 2023 |
|
|
|
|
Charge for the year |
|
|
|
|
Eliminated on disposal |
- |
( |
( |
|
At 30 September 2024 |
|
|
|
|
Carrying amount |
|||
|
At 30 September 2024 |
|
|
|
|
At 30 September 2023 |
|
|
|
|
Investments |
Company
|
2024 |
2023 |
|
|
Investments in subsidiaries |
|
|
|
Subsidiaries |
£ |
|
Cost or valuation |
|
|
At 1 October 2023 |
|
|
Provision |
|
|
Carrying amount |
|
|
At 30 September 2024 |
|
|
At 30 September 2023 |
|
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
|
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
|
|
2024 |
2023 |
|||
|
Subsidiary undertakings |
||||
|
|
Bromfield House Queens Lane,
United Kingdom |
|
|
|
|
Subsidiary undertakings |
|
MPH Construction Limited The principal activity of MPH Construction Limited is |
|
Other financial assets |
Group
|
Financial assets at cost less impairment |
Total |
|
|
Non-current financial assets |
||
|
Cost or valuation |
||
|
At 1 October 2023 |
2,200 |
2,200 |
|
At 30 September 2024 |
2,200 |
2,200 |
|
Impairment |
||
|
Carrying amount |
||
|
At 30 September 2024 |
|
2,200 |
The investment represents capitalised value of ground rents receivable from freehold interests.
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Debtors |
|
Group |
Company |
|||
|
Current |
2024 |
2023 |
2024 |
2023 |
|
Trade debtors |
|
|
- |
- |
|
Other debtors |
|
|
- |
|
|
Prepayments |
|
|
- |
- |
|
Gross amount due from customers for contract work |
|
|
- |
- |
|
|
|
- |
|
|
|
Cash and cash equivalents |
|
Group |
Company |
|||
|
2024 |
2023 |
2024 |
2023 |
|
|
Cash at bank |
|
|
- |
- |
|
Creditors |
|
Group |
Company |
||||
|
Note |
2024 |
2023 |
2024 |
2023 |
|
|
Due within one year |
|||||
|
Loans and borrowings |
|
- |
- |
- |
|
|
Trade creditors |
|
|
- |
- |
|
|
Amounts due to related parties |
- |
|
- |
- |
|
|
Social security and other taxes |
|
|
- |
- |
|
|
Outstanding defined contribution pension costs |
|
|
- |
- |
|
|
Other payables |
- |
|
- |
|
|
|
Accrued expenses |
|
|
- |
- |
|
|
Corporation tax payable |
481,333 |
847,194 |
- |
- |
|
|
Deferred income |
|
|
- |
- |
|
|
|
|
- |
|
||
|
Due after one year |
|||||
|
Loans and borrowings |
|
- |
- |
- |
|
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Provisions for liabilities |
Group
|
Deferred tax |
Provisions for dilapidation |
Total |
|
|
At 1 October 2023 |
|
|
|
|
Increase (decrease) in existing provisions |
|
( |
( |
|
At 30 September 2024 |
|
- |
|
|
|
|||
At the end of the lease term, the group has no obligation to repair damages arising from normal wear and tear, nor is it required to reinstate the leased property to its original condition. As a result, the previously recognised provision for dilapidation has been reversed during the period.
|
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £
Contributions totalling £
|
Share capital |
Allotted, called up and fully paid shares
|
2024 |
2023 |
|||
|
No. |
£ |
No. |
£ |
|
|
|
|
30 |
|
30 |
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Obligations under leases and hire purchase contracts |
Group
Operating leases
The total of future minimum lease payments is as follows:
|
2024 |
2023 |
|
|
Not later than one year |
|
|
|
Later than one year and not later than five years |
|
|
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
|
Dividends |
|
2024 |
2023 |
|||
|
£ |
£ |
|||
|
Interim dividend of £ |
999,750 |
2,676,750 |
||
|
Related party transactions |
M.P.H. (North Wales) Limited
Mr G Gaunt is in control and is the common directors in both the companies. MPH Construction Limited rents premises from M.P.H. (North Wales) Limited and annual rent payable was £52,000 (2023 - £48,000). MPH Construction Limited was also invoiced consultancy fee expenses of £104,463 (2023 - £113,960) from M.P.H. (North Wales) Limited.
At the balance sheet date the amount due to M.P.H. (North Wales) Limited is £248,802 (2023 - £123,550).
At the balance sheet date the amount due from M.P.H (North Wales) Limited is nil (2023 - nil).
The Spicy Pint Pub Company Limited
Mrs. Gwenan Roberts is the director of the company. Mrs. G Roberts is related to A G Roberts (Spouse), who is the director of MPH Construction Limited. During the year, MPH Construction has performed additional work for The Spicy Pint Pub Company Limited.
At the balance sheet date the amount due from The Spicy Pint Pub Company Limited is nil (2023 - £202,265).
Fareham Associates Limited
Notes to the Financial Statements for the Year Ended 30 September 2024
|
Parent company profit for the year |
The company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and Loss account in these consolidated financial statements. The profit of the parent company for the year was £930,016 (2023 - £2,490,000). The only income comprises of dividends received from the subsidiary company.
|
Parent and ultimate parent undertaking |
There is no controlling party.