Company Registration No. 11411412 (England and Wales)
CAVALRY HEALTHCARE LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
PM+M Solutions for Business LLP
Chartered Accountants
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
CAVALRY HEALTHCARE LTD
COMPANY INFORMATION
Directors
R McDonnell
L Whittaker
K McDonnell
B McDonnell
K Durband
(Appointed 5 December 2023)
Company number
11411412
Registered office
Lancashire House
The Sidings
Whalley
Clitheroe
BB7 9SE
Auditor
PM+M Solutions for Business LLP
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
CAVALRY HEALTHCARE LTD
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 7
Group statement of income and retained earnings
8
Group balance sheet
9
Company balance sheet
10
Group statement of cash flows
11
Notes to the financial statements
12 - 25
CAVALRY HEALTHCARE LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 1 -
The directors present the strategic report for the year ended 30 September 2024.
Review of the business
Turnover for the year ended 30 September 2024 has marginally decreased from the prior year. This is due to a strategic decision to reduce the supply of staff to nursing homes and expand the provision of care for service users with complex needs. As a result, gross profit increased from the prior year due to service differentials.
Net assets have increased in the year to 30 September 2024. The group continues to invest in its team members and tech solutions. The group has strong cash reserves which it will use to expand services geographically.
Demand for services remains high, based on the continuing strength and depth of relationships with a wide range of local authorities and NHS Trusts.
During 2024, Cavalry Healthcare reconfigured their existing services into several Group entities, Permanent Recruitment, Agency Staffing, and Children’s Services.
Principal risks and uncertainties
The directors have identified the following principal risks and uncertainties affecting the group:
Care quality risk - The group primarily care for high-acuity service users with complex needs. Services are delivered by a highly skilled staff team with service quality being monitored and managed daily through the implementation and operation of robust policies and procedures. Internal compliance processes and skills training programmes are supplemented by external compliance reviews.
Regulatory risk - The group operates in a regulated sector, with the key regulatory body being CQC. The group works closely and constructively with the regulatory body to maintain and improve its quality and compliance ratings, with a clear focus on regulatory compliance throughout its operational governance and people management processes.
Financial risk - The group’s customer range from Independent care homes to Local Authorities and NHS trusts. The group has strong cash reserves and is able to proactively manage any potential margin pressure arising from Government funding constraints.
Key performance indicators
The group monitors its performance using a number of measures, primarily focused on care quality and hours serviced. At 30 September 2024 the Cavalry Healthcare CQC rating was “Good”.
The directors consider that these indicators show that their prime focus is on delivery quality care at sustainable rates.
R McDonnell
Director
24 June 2025
CAVALRY HEALTHCARE LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 2 -
The directors present their annual report and financial statements for the year ended 30 September 2024.
Principal activities
The principal activity of the company continued to be that of healthcare agency services.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £273,253. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
R McDonnell
L Whittaker
K McDonnell
B McDonnell
M Medlicott
(Resigned 15 January 2025)
K Durband
(Appointed 5 December 2023)
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicants concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
The group'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 group'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
In accordance with the company's articles, a resolution proposing that PM+M Solutions for Business LLP be reappointed as auditor of the group will be put at a General Meeting.
CAVALRY HEALTHCARE LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 3 -
Statement of directors' responsibilities
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable laws 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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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 auditor of the company is unaware. Additionally, the directors 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 auditor of the company 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
R McDonnell
Director
24 June 2025
CAVALRY HEALTHCARE LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CAVALRY HEALTHCARE LTD
- 4 -
Opinion
We have audited the financial statements of Cavalry Healthcare Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2024 which comprise the group statement of income and retained earnings, the group balance sheet, the company balance sheet, the group 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:
give a true and fair view of the state of the group's and 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.
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 group and 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 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 group's and parent 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.
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:
The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
CAVALRY HEALTHCARE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAVALRY HEALTHCARE LTD
- 5 -
Matters on which we are required to report by exception
In the light of the 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 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:
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 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 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 parent 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.
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
CAVALRY HEALTHCARE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAVALRY HEALTHCARE LTD
- 6 -
Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we have considered the following:
the nature of the industry and sector, control environment and business performance including the design of the Company's remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;
results of our enquiries of management about their own identification and assessment of the risks of irregularities;
the matters discussed among the audit engagement team and relevant specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud;
any matters we identified having obtained and reviewed the Company's documentation of their policies and procedures relating to:
identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations.
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: timing of recognition of commercial income, posting of unusual journals and complex transactions; and manipulating the Company's performance profit measures and other key performance indicators to meet remuneration targets and externally communicated targets. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the Company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included UK Companies Act, employment law, health and safety regulations, pensions legislation and tax legislation.
Audit response to risks identified
Our procedures to respond to risks identified included the following:
reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
enquiring of management concerning actual and potential litigation and claims;
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC; and
in addressing the identified risks of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
CAVALRY HEALTHCARE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAVALRY HEALTHCARE LTD
- 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.
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.
Christopher Johnson FCA (Senior Statutory Auditor)
For and on behalf of PM+M Solutions for Business LLP, Statutory Auditor
Chartered Accountants
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
24 June 2025
CAVALRY HEALTHCARE LTD
GROUP STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
13,859,507
14,755,651
Cost of sales
(9,214,251)
(10,500,606)
Gross profit
4,645,256
4,255,045
Administrative expenses
(3,541,550)
(3,394,922)
Operating profit
4
1,103,706
860,123
Interest receivable and similar income
7
4,480
947
Profit before taxation
1,108,186
861,070
Tax on profit
8
(278,365)
(197,381)
Profit for the financial year
829,821
663,689
Retained earnings brought forward
2,300,430
1,810,782
Dividends
(273,253)
(174,041)
Retained earnings carried forward
2,856,998
2,300,430
Total comprehensive income for the year is all attributable to the owners of the parent company.
The notes on pages 12 to 25 form part of these financial statements.
CAVALRY HEALTHCARE LTD
GROUP BALANCE SHEET
AS AT 30 SEPTEMBER 2024
30 September 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Intangible assets
10
529,228
278,707
Tangible assets
11
106,931
44,131
636,159
322,838
Current assets
Debtors
14
3,290,861
1,540,684
Cash at bank and in hand
615,674
1,084,667
3,906,535
2,625,351
Creditors: amounts falling due within one year
15
(1,534,234)
(568,921)
Net current assets
2,372,301
2,056,430
Total assets less current liabilities
3,008,460
2,379,268
Provisions for liabilities
Deferred tax liability
16
151,362
78,738
(151,362)
(78,738)
Net assets
2,857,098
2,300,530
Capital and reserves
Called up share capital
18
100
100
Profit and loss reserves
2,856,998
2,300,430
Total equity
2,857,098
2,300,530
The notes on pages 12 to 25 form part of these financial statements.
These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.
The financial statements were approved by the board of directors and authorised for issue on 24 June 2025 and are signed on its behalf by:
24 June 2025
R McDonnell
Director
Company registration number 11411412 (England and Wales)
CAVALRY HEALTHCARE LTD
COMPANY BALANCE SHEET
AS AT 30 SEPTEMBER 2024
30 September 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Intangible assets
10
529,228
278,707
Tangible assets
11
106,931
44,131
Investments
12
1
1
636,160
322,839
Current assets
Debtors
14
3,335,354
1,540,683
Cash at bank and in hand
453,787
1,084,667
3,789,141
2,625,350
Creditors: amounts falling due within one year
15
(1,476,368)
(568,921)
Net current assets
2,312,773
2,056,429
Total assets less current liabilities
2,948,933
2,379,268
Provisions for liabilities
Deferred tax liability
16
151,362
78,738
(151,362)
(78,738)
Net assets
2,797,571
2,300,530
Capital and reserves
Called up share capital
18
100
100
Profit and loss reserves
2,797,471
2,300,430
Total equity
2,797,571
2,300,530
The notes on pages 12 to 25 form part of these financial statements.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £770,294 (2023 - £663,689 profit).
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 24 June 2025 and are signed on its behalf by:
24 June 2025
R McDonnell
Director
Company registration number 11411412 (England and Wales)
CAVALRY HEALTHCARE LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
1,629,989
1,543,941
Income taxes paid
(131,494)
(202,139)
Net cash inflow from operating activities
1,498,495
1,341,802
Investing activities
Purchase of intangible assets
(250,521)
(278,707)
Purchase of tangible fixed assets
(82,897)
(12,977)
Loans to related parties
(1,835,297)
(26,925)
Interest received
4,480
947
Net cash used in investing activities
(2,164,235)
(317,662)
Financing activities
Loans from related parties
470,000
-
Dividends paid to equity shareholders
(273,253)
(174,041)
Net cash generated from/(used in) financing activities
196,747
(174,041)
Net (decrease)/increase in cash and cash equivalents
(468,993)
850,099
Cash and cash equivalents at beginning of year
1,084,667
234,568
Cash and cash equivalents at end of year
615,674
1,084,667
The notes on pages 12 to 25 form part of these financial statements.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 12 -
1
Accounting policies
Company information
Cavalry Healthcare Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is .
The group consists of Cavalry Healthcare Ltd and all of its subsidiaries.
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. The principal accounting policies adopted are set out below.
1.2
Business combinations
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
1.3
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Cavalry Healthcare Ltd together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 30 September 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
1.4
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.
1.5
Turnover
Revenue from healthcare services shall be recognised when it is probable that the economic benefits associated with the transaction will flow to the agency and the revenue can be reliably measured. Revenue shall be recognised at the fair value of consideration received or receivable, net of any discounts, refunds, or allowances.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 13 -
Revenue recognition shall be based on the terms specified in contractual agreements with patients, healthcare facilities, insurance providers, or other third-party payers. Revenue shall be recognised in accordance with the terms and conditions of these agreements, including any milestone payments or performance obligations.
1.6
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Amortisation 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:
Software
33% Straight Line
At year end, the software was not in use; therefore, the intangible assets have not been amortised.
1.7
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.
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:
Fixtures and fittings
25% Straight Line
Office equipment
33% 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 recognised in the profit and loss account.
1.8
Fixed asset investments
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 14 -
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.9
Impairment of fixed assets
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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.
1.10
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.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.11
Financial instruments
The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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. Financial assets classified as receivable within one year are not amortised.
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 group after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, are initially recognised at transaction price. Financial liabilities classified as payable within one year are not amortised.
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.
1.12
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 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 if, and only if, there is 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.
1.13
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.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
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 leased asset are consumed.
2
Judgements and key sources of estimation uncertainty
In the application of the group’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.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 17 -
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Agency care services
2,561,070
8,925,933
Complex care services
11,298,437
5,829,718
13,859,507
14,755,651
2024
2023
£
£
Other revenue
Interest income
4,480
947
All revenue generated in the year arose within the United Kingdom.
4
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging:
Fees payable to the group's auditor for the audit of the group's financial statements
15,750
15,000
Depreciation of owned tangible fixed assets
20,097
20,251
Operating lease charges
177,315
253,126
5
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
Agency
485
480
485
480
Internal
60
62
60
62
Directors
6
5
6
5
Total
551
547
551
547
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
5
Employees
(Continued)
- 18 -
Their aggregate remuneration comprised:
Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
10,453,643
11,574,440
10,453,643
11,574,440
Social security costs
957,501
987,208
957,501
987,208
Pension costs
171,456
172,514
171,456
172,514
11,582,600
12,734,162
11,582,600
12,734,162
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
175,020
96,353
Company pension contributions to defined contribution schemes
1,101
-
176,121
96,353
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
2,800
Other interest income
1,680
947
Total income
4,480
947
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
205,741
131,494
Deferred tax
Origination and reversal of timing differences
72,624
65,887
Total tax charge
278,365
197,381
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
8
Taxation
(Continued)
- 19 -
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
1,108,186
861,070
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 22.01%)
277,047
189,522
Tax effect of expenses that are not deductible in determining taxable profit
1,313
113
Remeasurement of deferred tax for change in rates
7,886
Fixed asset differences
5
(140)
Taxation charge
278,365
197,381
9
Dividends
2024
2023
Recognised as distributions to equity holders:
£
£
Final paid
273,253
174,041
10
Intangible fixed assets
Group
Software
£
Cost
At 1 October 2023
278,707
Additions
250,521
At 30 September 2024
529,228
Amortisation and impairment
At 1 October 2023 and 30 September 2024
Carrying amount
At 30 September 2024
529,228
At 30 September 2023
278,707
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
10
Intangible fixed assets
(Continued)
- 20 -
Company
Software
£
Cost
At 1 October 2023
278,707
Additions
250,521
At 30 September 2024
529,228
Amortisation and impairment
At 1 October 2023 and 30 September 2024
Carrying amount
At 30 September 2024
529,228
At 30 September 2023
278,707
11
Tangible fixed assets
Group
Fixtures and fittings
Office equipment
Total
£
£
£
Cost
At 1 October 2023
44,858
39,502
84,360
Additions
66,041
16,856
82,897
At 30 September 2024
110,899
56,358
167,257
Depreciation and impairment
At 1 October 2023
18,690
21,539
40,229
Depreciation charged in the year
10,743
9,354
20,097
At 30 September 2024
29,433
30,893
60,326
Carrying amount
At 30 September 2024
81,466
25,465
106,931
At 30 September 2023
26,168
17,963
44,131
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
11
Tangible fixed assets
(Continued)
- 21 -
Company
Fixtures and fittings
Office equipment
Total
£
£
£
Cost
At 1 October 2023
44,858
39,502
84,360
Additions
66,041
16,856
82,897
At 30 September 2024
110,899
56,358
167,257
Depreciation and impairment
At 1 October 2023
18,690
21,539
40,229
Depreciation charged in the year
10,743
9,354
20,097
At 30 September 2024
29,433
30,893
60,326
Carrying amount
At 30 September 2024
81,466
25,465
106,931
At 30 September 2023
26,168
17,963
44,131
12
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
13
1
1
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 October 2023 and 30 September 2024
1
Carrying amount
At 30 September 2024
1
At 30 September 2023
1
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 22 -
13
Subsidiaries
Details of the company's subsidiaries at 30 September 2024 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Present Staffing Limited
England & Wales
Care services
Ordinary
100.00
The registered office for the above company is Lancashire House, The Sidings, Whalley, Clitheroe, England, BB7 9SE. The company registration number is 12524080
The company is included in the consolidated financial statements and has taken advantage of the exemption from the requirements of the Companies Act 2006 relating to the audit of accounts under section 479A of the Companies Act 2006.
14
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,262,893
1,193,947
1,189,402
1,193,947
Unpaid share capital
100
100
100
100
Amounts owed by group undertakings
-
-
117,984
-
Other debtors
1,883,080
46,287
1,883,080
46,286
Prepayments and accrued income
144,788
300,350
144,788
300,350
3,290,861
1,540,684
3,335,354
1,540,683
Included within other debtors are amounts receivable from related parties totalling £1,853,808. These loans are interest-free and repayable on demand.
15
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
£
£
£
£
Trade creditors
262,181
95,979
262,181
95,979
Corporation tax payable
205,741
131,494
185,899
131,494
Other taxation and social security
353,323
178,248
316,799
178,248
Other creditors
668,902
22,918
668,902
22,918
Accruals and deferred income
44,087
140,282
42,587
140,282
1,534,234
568,921
1,476,368
568,921
Included within other creditors are amounts payable to related parties totalling £481,680. These loans are interest-free and repayable on demand.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 23 -
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Liabilities
Liabilities
2024
2023
Group
£
£
Accelerated capital allowances
158,829
78,738
Short term timing differences
(7,467)
-
151,362
78,738
Liabilities
Liabilities
2024
2023
Company
£
£
Accelerated capital allowances
158,829
78,738
Short term timing differences
(7,467)
-
151,362
78,738
Group
Company
2024
2024
Movements in the year:
£
£
Liability at 1 October 2023
78,738
78,738
Charge to profit or loss
72,624
72,624
Liability at 30 September 2024
151,362
151,362
The increase in the deferred tax liability arises from accelerated capital allowances in the year, and this will reverse over the lives of the related assets. However, this reversal may be partially offset by additional deferred tax charges arising from further accelerated capital allowances on future asset purchases.
17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
171,456
172,514
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
Contributions totalling £29,868 (2023: £7,888) were payable to the fund at the balance sheet date.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 24 -
18
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and not fully paid
Ordinary Shares A of £1 each
40
40
40
40
Ordinary Shares B of £1 each
40
40
40
40
Ordinary Shares C of £1 each
10
10
10
10
Ordinary Shares D of £1 each
10
10
10
10
100
100
100
100
All shares are fully paid and rank pari passu in all respects unless otherwise stated in the company’s Articles of Association.
19
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2024
2023
2024
2023
£
£
£
£
Within one year
109,168
95,588
109,168
95,588
Between two and five years
59,233
79,828
59,233
79,828
168,401
175,416
168,401
175,416
20
Other guarantees and commitments
The company has guaranteed the rental payments under a lease for a related party under common control. The total commitment under the lease at the balance sheet date is £293,328.
21
Related party transactions
Rent of £50,000 was charged by a company under common control in the year.
22
Directors' transactions
At the year end an amount of £1,647 (2023 - £28,103) was due to the company by a director. The maximum amount owing in the year was £73,047.
At the year end an amount of £25,560 (2023 - £15,767) was due to the company by a director. The maximum amount owing in the year was £30,417.
The loans were interest free and there are no specific repayment terms.
CAVALRY HEALTHCARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2024
- 25 -
23
Cash generated from group operations
2024
2023
£
£
Profit after taxation
829,821
663,689
Adjustments for:
Taxation charged
278,365
197,381
Investment income
(4,480)
(947)
Depreciation and impairment of tangible fixed assets
20,097
20,251
Movements in working capital:
Decrease in debtors
85,120
865,952
Increase/(decrease) in creditors
421,066
(202,385)
Cash generated from operations
1,629,989
1,543,941
24
Analysis of changes in net funds - group
1 October 2023
Cash flows
30 September 2024
£
£
£
Cash at bank and in hand
1,084,667
(468,993)
615,674
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