The members present their annual report together with the audited financial statements of BCL Solicitors LLP (the "LLP") for the year ended 31 March 2025.
BCL Solicitors LLP is principally engaged in the provision of legal services in the UK.
Change of year end
In the last reporting period the financial year of the LLP was changed from 31 August to 31 March to align with the new HMRC basis period reform which requires partnerships to report business tax information on a tax year basis.
The current financial statements are prepared for the 12-month period ended 31 March 2025 with comparative figures for the 7 months ended 31 March 2024 stated in the statement of comprehensive income, the statement of cash flows and the related notes, and as such, are not comparable.
The partners regard the results for the year as satisfactory and expect the level of activity in the period to continue in the current financial year.
We have a detailed financial plan for the year to 31 March 2026 and extended cash flow forecasts to 31 July 2026. The firm has maintained close control over its operations and will continue to take appropriate actions to safeguard and grow the business. We are satisfied that the firm’s market-leading strength and reputation in its key areas and targeted expansion into complementary areas, together with the measures that have been adopted and very strong cash controls, will enable it to trade successfully over the coming year and beyond. Further details regarding management’s going concern assessment are disclosed in note 1.
The results for the year are set out on page 9.
The LLP operates a drawings policy, which has regard to an estimate of budgeted profits. Drawings are restricted to prudent levels, taking into account working capital performance, until the results for the period and individual members' allocations have been determined.
Members' capital requirements are determined from time to time by the Management Committee having regard to the short, medium and long-term needs of the business.
The designated members who held office during the year and up to the date of signature of the financial statements were as follows:
The objective of the LLP in managing liquidity risk is to ensure that it can meet its financial obligations as and when they fall due. The LLP expects to meet its financial obligations through operating cash flows. In the event that the operating cash flows would not cover all the financial obligations the LLP has credit facilities available. Given the maturity of the bank loans in note 16, the LLP is in a position to meet its commitments and obligations as they fall due.
The LLP borrows from its bankers using either overdrafts or term loans whose tenure depends on the nature of the asset and management's view of the future direction of interest rates.
The LLP may offer credit terms to its customers which allow payment of the debt after performance of the services. The LLP is at risk to the extent that a customer may be unable to pay the debt on the specified due date. This risk is mitigated by the strong on-going client relationships.
Moore Kingston Smith LLP were appointed as auditor to the limited liability partnership and in accordance with section 485 of the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008), a resolution proposing that they be re-appointed will be put at a general meeting.
The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice. Under company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members 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 limited liability partnership and of the profit or loss of the limited liability partnership for that period. In preparing these financial statements, the members are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the limited liability partnership will continue in business.
The members are responsible for keeping adequate accounting records that are sufficient to show and explain the limited liability partnership’s transactions and disclose with reasonable accuracy at any time the financial position of the limited liability partnership and enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the limited liability partnership and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of BCL Solicitors LLP (the 'limited liability partnership') for the year ended 31 March 2025 which comprise the Statement of Comprehensive Income, the Balance Sheet, the Reconciliation of Members' Interests, the Statement of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the members' 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 limited liability partnership’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 members with respect to going concern are described in the relevant sections of this report.
Other information
Explanation as to what extent 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.
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the limited liability partnership.
Our approach was as follows:
We obtained an understanding of the legal and regulatory requirements applicable to the limited liability partnership and considered that the most significant are the Companies Act 2006 as applied to limited liability partnerships by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008, the Limited Liability Partnerships SORP, UK financial reporting standards as issued by the Financial Reporting Council, and the regulations of the Solicitors Regulation Authority.
We obtained an understanding of how the limited liability partnership complies with these requirements by discussions with management and those charged with governance.
We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.
We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.
Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
Use of our report
This report is made solely to the Limited Liability Partnership’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 (as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). Our audit work has been undertaken so that we might state to the Limited Liability Partnership’s members those matters which 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 any party other than the Limited Liability Partnership and the Limited Liability Partnership’s members as a body, for our work, for this report, or for the opinions we have formed.
The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.
There was no other comprehensive income for the year to 31 March 2025 or the period to 31 March 2024.
The notes on pages 14 to 25 form part of these financial statements.
The notes on pages 14 to 25 form part of these financial statements.
The notes on pages 14 to 25 form part of these financial statements.
The notes on pages 14 to 25 form part of these financial statements.
BCL Solicitors LLP is a limited liability partnership incorporated in England and Wales. The registered office is 51 Lincoln's Inn Fields, London, WC2A 3LZ.
The limited liability partnership's principal activities are disclosed in the Members' Report.
The financial statements have been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 —'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' ('FRS 102), Companies Act 2006 as applied by LLPs and the Statement of Recommended Practice (SORP), Accounting by Limited Liability Partnerships, issued in December 2021. The financial statements have been prepared on the historical cost basis except for the modification to a fair value basis for certain financial instruments as specified in the accounting policies below.
The financial statements are prepared in Sterling, which is the functional currency of the limited liability partnership. Monetary amounts in these financial statements are rounded to the nearest pound.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The LLP generated a profit before members' remuneration of £6,033,062 for the year ended 31 March 2025 (7 month period to March 2024: £4,403,215). At the balance sheet date the LLP had net assets attributable to members of £5,606,222 (2024: £5,985,571) including cash at bank of £323,406 (2024: overdraft of £607,902) and bank loans of £1,131,318 (2024: £584,849). The bank loans are repayable by monthly instalments until 25 June 2026, of which capital repayments of £772,608 have been made after the reporting date by the date of approval of the financial statements. Subsequent to the reporting date the LLP has committed to a six month loan of £541,000 repayable by monthly instalments.
After reviewing the LLP’s forecasts and projections, the members have a reasonable expectation that the LLP has adequate resources to continue in operational existence for the foreseeable future. Detailed projections including a full budget and cash flow forecast at monthly rests until 31 July 2026 have been produced. In preparing these forecasts certain assumptions have been incorporated that are key to its success. These include assumptions about the number of debtor days outstanding at each month end and potential bad debt exposure. The LLP has previously used short term borrowings to finance certain cash out flows and plans to continue to do so in the coming twelve months. The LLP has an overdraft facility which the forecasts show will only partially be utilised and demonstrates that the LLP has sufficient resources to continue in operation and therefore the members continue to adopt the going concern basis in preparing its financial statements.
Turnover reflects the total amount estimated to be receivable for services rendered, and disbursements charged to clients during the year, excluding VAT.
Income is recognised when a right to consideration has been obtained through performance under each contract and reflects the contract activity during the year having regard to the stage of completion of each contract and the relative uncertainty of predicting ultimate profitability on long term assignments. Revenue in respect of conditional or contingent fee engagements, which is over and above any agreed minimum fee, is recognised when the contingent event occurs.
Client disbursements incurred are deducted from income in arriving at net fees shown in the profit and loss account.
Unbilled fee income is included as amounts recoverable on contracts within debtors. Amounts recoverable on contracts are stated at fair value where the right to consideration has been obtained. Provision is made against unbilled amounts on those engagements where right to receive payments is contingent on factors outside the control of the LLP.
Members' fixed shares of profits (excluding discretionary fixed share bonuses) and interest earned on members' balances are automatically allocated and are treated as members' remuneration charged as an expense to the profit and loss account in arriving at profit available for discretionary division among members.
The final allocation of profits and distribution to Members is made once the annual financial statements are approved. Accordingly, all profits relating to the LLP are shown as Members remuneration charged as an expense in the statement of comprehensive income.
Other amounts applied to members, for example interest on capital balances, are treated in the same way as all other divisions of profits, as described above, according to whether the LLP has, in each case, an unconditional right to refuse payment. Amounts payable to members and unavoidable interest on members capital are charged to “members remuneration charged as an expense” in the relevant year.
Members' capital is repayable and therefore classified as a liability. Other than in exceptional cases, it is not repaid until after retirement. Because members may retire with less than one year's notice and typically have their capital repaid within one year of serving notice, members' capital is shown as being due within one year notwithstanding repayment could be made after more than one year at the discretion of the Management Committee.
Tangible fixed assets are stated at cost net of depreciation and provision for any impairment.
Depreciation is calculated to write down the cost less estimated residual value of all tangible fixed assets, other than freehold properties, by equal annual instalments over their estimated useful economic lives. The periods generally applicable are:
Investments comprise shares in a private company and are held at cost, less provision for impairment.
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the LLP's cash management.
Investments are valued at cost less provision for impairment. Basic financial instruments are recognised at amortised cost.
The LLP enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities such as accrued income, trade and other receivables, accruals and trade and other payables. Short term receivables are measured at transaction price, less any impairment. Short term payables are measured at transaction price. Other financial liabilities are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
The taxation payable on the LLP profits is the personal liability of the members, although payment of such liabilities is administered by the LLP on behalf of the members. Consequently, neither partnership taxation nor related deferred taxation are accounted for in the financial statements. Sums set aside in respect of members' tax obligations are included in the balance sheet within loans and other debts due to members or set against amounts due to members as appropriate.
The firm has property leases which contain an obligation to reinstate the premises to the condition when the lease was entered into. The firm makes provision for dilapidations to the extent when it is probable such an obligation will result in a financial liability.
Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the lease term.
The aggregate benefit of lease incentives is recognised as a reduction to the expense recognised over the lease term on a straight-line basis.
Pensions
The LLP pays fixed contributions into a defined contribution pension scheme for the benefit of certain employees. The LLP has no legal or constructive obligation to pay contributions in addition to its fixed contributions, which are recognised as an expense in the period that related employer services are received.
Amounts not paid are shown as a liability in the Balance Sheet. The assets of the plan are held separately from the LLP in independently managed funds.
Debtors
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Creditors
Short term trade creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include:
The requirement for a provision against client receivables is considered on a case by case basis having regards to the specific circumstances of the client and the associated matters.
Unbilled revenue from legal services is assessed on an individual matter basis with revenue earned being ascertained based on time spent to date. Unbilled time is subject to management review and time as measured at standard hourly rates is adjusted where this differs from the amount that is expected to be recovered.
Provisions have been made for dilapidations costs. The provisions are estimates and the actual costs and timing of future cash flows are dependent on future events. The difference between expectations and the actual future liability will be accounted for in the period when such determination is made.
Depreciation is provided at rates calculated to write off the cost of tangible fixed assets, less their estimated residual value, over their expected useful lives.
An analysis of the limited liability partnership's turnover is as follows:
All turnover arose within the United Kingdom.
The aggregate remuneration of the employees (excluding members) comprised:
Profits are shared among the members in accordance with agreed profit-sharing arrangements and include interest on members’ funds.
Key management personnel are defined as Designated members of the LLP.
The total emoluments of key management personnel were £3,280,827 (2024: £2,409,609).
A provision for doubtful recovery of £1,127,850 (2024: £555,652) was recognised against trade debtors and £182,616 (2024: £43,910) against amounts recoverable on contracts.
The bank overdraft and loans are secured by a debenture over the fixed and current assets of the LLP.
Included in loans are the following loans outstanding at the reporting date:
Loan 1 amounting to £790,538 at the reporting date is repayable by monthly instalments until 28 July 2025, with interest charged at 4.03%.
Loan 2 amounting to £131,065 at the reporting date is repayable by monthly instalments until 27 September 2025, with interest charged at 6.06% and is unsecured.
Loan 3 amounting to £95,231 at the reporting date is repayable by monthly instalments until 2 April 2025, with interest charged at 10.62% and is unsecured. The loan has been repaid in full post year end.
Loan 4 amounting to £114,484 at the reporting date is repayable by monthly instalments until 25 June 2026, with interest charged at 6.58% and is unsecured.
In the event of a winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors.
The limited liability partnership operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the limited liability partnership in an independently administered fund.
At the reporting end date the limited liability partnership had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
In the opinion of the partners there is no controlling party as defined by FRS 102 Section 33 "Related Party Disclosures".
There are no related party transactions in the year (2024: £nil).