The directors present the strategic report for the year ended 31 December 2024.
The statement of financial position shows the company's financial position at the year end. The company's turnover from Continuing Operations for the year was £43,574,816 (31 December 2023: £43,338,129), The net assets as at 31 December 2024 were £21,196,231 (31 December 2023: £19,949,854).
During the prior year the Group made the strategic decision to dispose of the investments it held in Medicals Direct Services Limited and Medicals Direct Screenings Services for consideration of £1,433,878. During the prior year these companies made a loss of £68,410, which have been presented as Discontinued Operations on the Statement of Comprehensive Income. Disposing of these investments allow the management to focus on Continuing Operations where the Group has increased Operating Profit during the year.
The introduction of the Official Injury Claim Portal in May 2021 has resulted in the total number of cases in the market reducing, however this has not had a significant negative impact on the performance of the company. The company has been impacted by the change in collection profiles, however the Directors believe that any change in collection profile in the short term will reverse in the long term, as the services provided support access to justice for individual claimants.
As the Group provides gives long term credit, the increase in interest rates in 2022 impacted the profitability of some sources of work. To mitigate this the Directors conducted a full review of all revenue streams and credit terms and where contracts could not be renegotiated with customers, the Group ceased taking new instructions. Whilst this resulted in a decrease in turnover, Gross Margin from Continuing Operations has increased.
During the year the Group refinanced from Barclays Bank Plc to RBS Invoice Discounting Limited, which increased the credit facility available and mitigated the rising interest rates.
All of the above mean the results are not easily comparable to preceding years.
Given some of the challenges that have been faced over the last three years, the directors are satisfied with the performance of the company for the year ended 31 December 2024 and with its balance sheet position at this date.
Key performance indicators are disclosed below.
Legislative risk
The industry in which the group operates is overseen by the Ministry of Justice. As Premier Medical Group Limited and Mobile Doctors Limited are both accredited High Volume National Medical Reporting Organisations, we adhere to rigorous requirements and audits by MedCo. The Group keeps up to date with revisions to the system and the qualifying criteria.
The introduction of the Official Injury Claim portal, by the Ministry of Justice, in May 2021 and present both a risk and an opportunity to future volumes.
The Directors continue to review and consider the group's options and strategies to mitigate any potential negative impact and seek growth in other areas unaffected by the reforms.
Credit and cashflow risk
The group gives long credit terms to many of its customers. This is abrogated by reconciling regularly and issuing any credit notes promptly. The company monitors its short and middle term cash requirements and makes sure it has adequate funds to pay liabilities as they fall due. To offset the problems caused by the delays in cases within the Official Injury Claims Portal the group is actively looking to improve the ratio of short to long term credit.
Competitive risk
The industry in which the group operates is subject to strong competition from other providers. The group remains focused in providing the industry best service at a competitive price. Customer contracts generally extend past three years; both relationships and commercials are regularly reviewed to ensure contracts are the best value in the market.
The industry in which the group operates has changed following the introduction of the Official Injury Claims Portal. There has been a reduction in the total number of cases following implementation of the portal, although this has not had a significant negative impact on the performance of the group. There is currently uncertainty on the effect the portal will have on collection profiles, and this has an impact on group’s cash flows. The Directors remain of the opinion that any change in collection profile in the short term will reverse in the long term as the services provided support access to justice for individual claimants.
The group intends to consolidate its position in core markets to successfully manage any uncertainty caused by the reforms discussed, whilst exploring growth opportunities in adjacent markets.
Key performance indicators used by the group (including discontinued operations) were as follows:
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| 31.12.2024 |
| 31.12.2023 |
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Turnover | £'000 | 43,575 |
| 47,701 |
Gross margin | % | 26.0 |
| 22.9 |
Profit After Tax (PAT) | £'000 | 1,956 |
| 796 |
PAT / Turnover | % | 4.5 |
| 1.7 |
Net Assets | £'000 | 21,196 |
| 19,950 |
Average employees | No's | 245 |
| 261 |
Receivable Collection | Days | 378 |
| 440 |
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Going Concern
After considering the company's forecast for the next 12 months, the directors have a reasonable expectation that the company has adequate cash and resources to meet all requirements to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
The directors of Kuro Health Limited are required to act in a way that they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in so doing have regard, among other matters to:
The likely consequences of any decision in the long term;
The interests of the Company’s employees;
The need to foster the Company’s business relationships with suppliers, customers and others;
The impact of the Company’s operations on the community and the environment;
The desirability of the Company maintaining a reputation for high standards of business conduct; and
The need to act fairly as between members of the Company.
To achieve their duties under Section 172 the directors pride themselves in ensuring that the Company is properly financed so that going concern should never be an issue. There is a fair dividend policy that ensures that the shareholders are adequately rewarded and the company retains sufficient profits to maintain a healthy balance sheet.
The directors/shareholders are involved in the day to day running of the business and have a team of managers who report regularly and meet on a monthly basis.
Good supplier relationships are fostered by the directors and managers and the Company ensures that suppliers are paid within their terms.
The Company strives to improve its standards which benefit its customers. The Company continually reviews financial information.
The directors produce three year plans to ensure the succession of the business, taking into account the local environment and communities in which their sites operate.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2024.
The results for the year are set out on page 12.
Ordinary dividends were paid amounting to £709,800 in the year. The directors do not recommend payment of a final dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The group’s principal financial instruments comprise cash and cash equivalents, trade creditors and trade debtors. The main purpose of these instruments is to raise funds for the group’s operations. Due to the nature of these funds there is no exposure to price risk. There is a bank funding line from Barclays Bank PLC, this provides working capital and is secured against the assets of the group. A CBILS loan was taken out at the start of the pandemic.
Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding and overdue. Trade creditors risk is managed by ensuring sufficient funds are available to meet amounts due.
The group's policy is to consult and discuss with employees, through, staff councils, at meetings and online platforms, 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.
An important part of the company's long term success is considered to be the need to regularly engage with all customers, potential customers and suppliers trying to match the needs of the customers and improving the service offered to them. This is achieved by seeking innovative ideas to improve service and to heed the request from suppliers for alternative methods to fulfil their contracts. During the pandemic the video assessment protocols have benefited all in the industry in the short term.
The group's mid term strategy is to consolidate it's position as a leading supplier of medical reports and related services by continually improving the solutions and services offered to customers.
The auditor, Price Bailey LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Greenhouse Gas Emissions Data
In line with the Greenhouse Gas Protocol (GHG) Corporate Accounting and Reporting Standard, and as reported in our previous submissions, Kuro Health Limited continues to be engaged in a process aimed at reducing our energy and greenhouse gas emissions.
Kuro Health maintains scopes one (1), two (2) and three (3) emissions, which include electricity and natural gas. Kuro Health also maintains transport emissions inclusive of employee owned and operated vehicles (whereby mileage is claimed as a company expense).
Kuro Health previously devised a strategy to reduce overall carbon footprint significantly including the following initiatives:
- Encouraging employees to purchase renewable technology cars i.e., hybrid vehicles,
- Purchasing energy efficient equipment in our offices,
- Replacing HVAC systems with energy-efficient equipment where possible,
- Adopting behavioural change measures where possible.
This commitment has resulted in an improvement in our emissions position. Calculated carbon footprint for the current financial year is 46.23 tCO2e, whilst energy consumption was 219,962.09 kWh (219.96 MWh).
The intensity metric is based on a total square meterage of 1,586.23 (17,074 square feet). Emissions have decreased by 35.28% since our previous reporting period.
Kuro Health have reported all of emission sources under the Companies Act 2006 (Strategic Report and Director’s Reports) Regulations 2013 as required. Reporting of calculated emissions is in line with the GHG Protocol Corporate Accounting and Reporting Standard and emission factors from the UK Government's GHG Conversion Factors for Company Reporting 2024.
The reporting period is the financial year 2024, the same as that covered by the Annual Report and Financial Statements. The boundaries of the GHG inventory are defined using the operational control approach. In general, the emissions reported are the same as those which would be reported based on a financial control boundary.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per metre squared, the recommended ratio for the sector.
Kuro has been actively engaged in measures to reduce its energy throughout the reporting period as follows:
Closure of Borehamwood office in 2023, moving to hybrid working model around a serviced office with reduced footprint
Closure of Dorking office in 2023, transferring work to another site
Closure of dedicated Ludlow office in 2024, moving staff to a serviced office and increasing utilisation of home working model
Continue to utilise hybrid working therefore reducing commuting to office
Continue to minimise business travel, and utilise technology solutions such as digital meetings
Electric car policy for all staff
Working on ways to reduce outbound postage replacing with digital pathways
Note that we do not maintain any direct energy responsibility, but we are keen to show our commitment to reducing energy and emissions.
Update on objectives for prior year
In order to achieve the objectives set last year, the Group has substantially reduced its office footprint which has resulted in reducing our energy usage especially in relation to lighting. Reducing the office footprint has also reduced the volume of office equipment required. The Group has also submitted Energy Saving Opportunity Scheme (ESOS) Phase 3 compliance submission.
Objectives for 2025
Kuro Health has initiated several objectives for the forthcoming fiscal year (to be reported on in the next set of accounts) as follows
Continual review of existing office footprints, including review of equipment and company policies
Reviewing supply contracts to determine feasibility of renewable energy
Continue to review business model to utilise digital pathways that reduce physical movement of documents and people
Kuro Health will report on progress within the next set of financial accounts.
After considering the company's forecast for the next 12 months, the directors have a reasonable expectation that the company has adequate cash and resources to meet all requirements to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
We have audited the financial statements of Kuro Health Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2022, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated and Company Balance Sheets, the Consolidated and Company Statement of Changes in Equity, the Consolidated Statement of Cash Flows and the related notes, 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).
Basis for 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 or the 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.
Other information
Opinion on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
the information given in the Group 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 Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
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 gained an understanding of the legal and regulatory framework applicable to the group and the industries in which it operates and considered the risk of the group and company not complying with the applicable laws and regulations including fraud in particular those that could have a material impact on the financial statements. This included those regulations directly related to the financial statements, including financial reporting, tax legislation and distributable profits. In relation to the industry, this included consideration of the Medco status of various members of the group, employment law and health & safety. The risks were discussed with the audit team and we remained alert to any indications of non-compliance throughout the audit.
The risks were discussed with the audit team and we remained alert to any indications of non-compliance throughout the audit. We carried out specific procedures to address the risks identified. As follows:
Reviewing legal fees incurred;
Reviewing minutes of meetings of those charged with governance;
Enquiring of management including those responsible for the key regulations;
Reviewing the latest Medco Reports with consideration of the policies and procedures in place to ensure the relevant company is compliant with Medco and the response from management in implementing recommendations and guidance highlighted by Medco in the most recent review.
Reviewing the key accounting policies and estimates
Agreeing the financial statement disclosures to underlying supporting documentation.
To address the risk of management override of controls, we reviewed systems and procedures to identify potential areas of management override risk. In particular, we carried out testing of journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions to identify large or unusual transactions. We reviewed key authorisation procedures and decision-making processes for any unusual or one-off transactions. We also assessed management bias in relation to the accounting policies adopted and in determining significant accounting estimates.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Auditors' 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.
Kuro Health Limited ("the company") is a private limited company domiciled and incorporated in England and Wales and limited by shares. The registered office is 4th Floor, Park Gate, 161-163 Preston Road, Brighton, East Sussex, BN1 6AF.
The group consists of Kuro Health Limited and all of its subsidiaries.
The group's consolidated and the company's financial statements have been prepared in compliance with FRS102 as it applies to the financial statements for the year ended 31 December 2024.
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 £.
Basis of preparation for the company
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 'Statement of Cash Flows'.
Section 33 ‘Related Party Disclosures’.
The consolidated financial statements of the group include the results of the company. Consequently, as permitted by s408 of the Companies Act 2006, no individual company income statement is presented in these financial statements for Kuro Health Limited.
The principal accounting policies adopted are set out below.
The consolidated financial statements incorporate those of Kuro Health Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the period are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 31 December 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.
After considering the company's forecast for the next 12 months, the directors have a reasonable expectation that the company has adequate cash and resources to meet all requirements to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
Turnover is recorded at the fair value of the consideration receivable in the normal course of business, net of VAT, other sales related taxes and discounts.The group provides services in the medical legal sector and the IT software sector.
Medical work is contracted for delivery over an agreed period, typically ending at the settlement of the legal medical claim. Requests for payments are issued at predetermined points in the process according to contract and are recorded as turnover. At the balance sheet date, the company accrues for turnover in respect of services performed but un-invoiced, accrued income is included within other debtors. Any associated expected costs of services provided are accrued and included in other creditors.
IT software services are contracted for delivery over an agreed period. Requests for payments are issued at predetermined points in the process according to contract and are recorded as turnover. At the balance sheet date, the company accrues for turnover in respect of services performed but un-invoiced, accrued income is included within other debtors. Any associated expected costs of services provided are accrued and included in other creditors.
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.
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.
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.
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, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the period. 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.
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.
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. Payments to the defined contribution scheme are charged as an expense as they fall due.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
The group operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. Payments to the defined contribution scheme are charged as an expense as they fall due.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
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.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Revenue from services is recognised in accordance with the policy set out at 1.3. While cases typically complete within two years, there are instances where cases are unsuccessful, and fees are not recoverable. As a consequence, significant judgment is required to account for potential unsuccessful cases.
A prudent provision for credit notes is made, as noted in 1.3, to estimate the potential impact of case profiles and the respective incomes. The provision is calculated based on extensive historical experience, up-to-date information on current market trends, utilising industry knowledge, and other relevant factors. Any such assumptions are by their nature subjective, and if actual outcomes differ from these assumptions, it could give rise to a materially different financial outcome.
The provision is calculated as a percentage of invoiced revenue in a calendar year. Therefore, should the provision be over or understated by 1%, the impact in the financial statements based on 2024 turnover would be £401,063 (2023: £405,120). Given the long credit offer to customers (see KPIs), the percentages applied in prior years are reviewed annually, and estimates are adjusted accordingly in line with actual trading performance until all invoices raised have been collected. As some cases settle over a longer period, the impact of a 1% change in provision could be compounded by the number of years taken for cases to settle, meaning the cumulative impact of changes in underlying trends on this provision could be significant over time.
Therefore, the financial results of the company are sensitive to movements in this provision if underlying trends change. However, the senior management team believes they have adequate and robust controls and key performance indicators (KPIs) in place to continually monitor and assess the suitability of the provision, and that it is fairly stated in the financial statements based on all available evidence at the year-end. The directors are confident that the credit note provision reflects a reasonable and prudent estimate given the inherent uncertainty.
Investment in subsidiaries are recognised in accordance with the policy set out at 1.8 on the expectation that costs are contractually payable. However, there are instances where costs payable are deferred and payable based on future contract performance.
Consequently, an element of judgement is required to account for potential fluctuations in cost of investments. The provision is calculated based on historical experience, current trends, industry knowledge and other relevant factors. A change in those judgements and future performance could have an impact on the accounts. Therefore, the balance sheet of the company is sensitive to movements in this provision if assumptions and future performance.
The senior management team have adequate controls and KPIs in place to monitor and assess the suitability of the assessment to ensure income and investment cost are fairly stated in the financial statements.
An analysis of the group's turnover is as follows:
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The number of directors the company pension contributions relates to in the period under review is 2
(2023: 2).
Directors of the business are deemed to be key management and have been remunerated accordingly.
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:
The company disposed of the investments it held in South East Specialist Medical Reports Limited on 29 March 2024.
During the period to 29 March 2024, the company made a loss of £3,330.
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
The impairment losses in respect of financial assets are recognised in other gains and losses in the profit and loss account.
More information on impairment movements in the year is given in note 14.
The Company disposed of the investments it held in South East Specialist Medical Reports Limited on 29 March 2024.
Details of the company's subsidiaries at 31 December 2024 are as follows:
Registered office:
A - 4th Floor, Park Gate, 161-163 Preston Road, Brighton, East Sussex, England. BN1 6AF
B - Palatine House, Belmont Business Park, Durham, England. DH1 1TW
C - Unit 1-3, Suite A, The Courtyard, Calvin Street, Bolton, England. BL1 8PB
WARP Medical Reporting Limited was struck from the Company Register on 18 June 2024.
The shares held in South East Specialist Medical Reports Limited were sold on 29 March 2024, and consequently Kuro Health Limited also lost indirect interest in its subsidiaries from this date (Medchi Limited and Medical Specialist Reporting Group Limited).
During the year, the Group's finance facilities were refinanced from Barclays Bank Plc to RBS Invoice Finance Limited
The group has access to an invoice discount facility of £20,000,000 (2023: £14,025,000), and a CBILS loan. As at 31 December 2024 the outstanding balance due to RBS Invoice Finance Limited in respect of the invoice discount facility was £14,497,443 (2023 owed to Barclays Bank Plc: £13,545,347).
The facility is secured by a fixed and floating charge over current and future assets of various subsidiary companies.
The provisions for dilapidations are in respect of leases on properties occupied by the group. The group has two leases of varying lengths and optional break clauses. The senior management team assess the provisions with advice from qualified professionals where appropriate.
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
The preference shares were fully redeemed on 23 December 2024, therefore the dividend paid, of 12% of the subscription price, was pro-rated to this date.
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:
The lease commitments are in respect of rental agreements for properties. In the prior year the group calculated its commitment excluding any contractual break clauses. Two break clauses have been enacted which represents the movement shown above.
During the year the company made payments for consultancy and professional fees totalling £370,604 (31 December 2023: £481,922) to companies controlled or associated to the directors.
At the balance sheet date, a company associated to a director had an outstanding balance owed to it of £551.
At the balance sheet date, a company within the Group was owed £220,871 by a company associated to two directors (2023: £13,387 was owed by the company).
Folkington Finance Limited is a company controlled or associated to the directors, was owed £nil as at 31 December 2024 (31 December 2023: £675,774). During the year, it advanced £nil (2023: £nil) and received a preference dividend of £137,918 (2023: £141,000) from the company. The preference shares held by Folkington Finance Limited were fully redeemed on 23 December 2024, see note 27 for further details.
During the year the company received a payment of £1,350,000 from Folkington Finance Limited relating to the purchase of trade debtors net of associated VAT and credit note provisions. This transferred the risks and rewards of these trade debtors to the buyer.
No details are included for the transactions with subsidiaries that are 100% owned as the exemption for such companies is being claimed.
The previous cross guarantee was given by the company in favour of Barclays Bank Plc, this was replaced in November 2024 with a cross guarantee in favour of RBS Invoice Finance Limited . The cross guarantee is in support of the finance facilities provided to the Kuro Health group of entities. The cross guarantee includes the following group companies: Premier Medical Group Limited, Rehab-Link Limited and Mobile Doctors Limited. The balance owed to RBS Invoice Finance Ltd at 31 December 2024 was £14,426,614 (31 December 2023 to Barclays Bank PLC: £13,513,570).