Company No:
Contents
| DIRECTORS | B Blanco |
| Sir David Chipperfield | |
| A Graham | |
| G Laughlan (Appointed 20 January 2025) | |
| J Loughnane (Appointed 20 January 2025) | |
| W Prendergast | |
| R Sandi (Appointed 20 January 2025) |
| REGISTERED OFFICE | 22 Little Portland Street |
| London | |
| W1W 8BU | |
| United Kingdom |
| BUSINESS ADDRESS | 22 Little Portland Street |
| London | |
| W1W 8BU |
| COMPANY NUMBER | 03899734 (England and Wales) |
| AUDITOR | Praxis |
| Statutory Auditor | |
| 1 Poultry | |
| London | |
| EC2R 8EJ |
The directors present their Strategic Report for the financial year ended 31 December 2024.
REVIEW OF THE BUSINESS
DCA pursued a strategic rethink of the practice and leadership team mid-2023 that enabled stabilisation and a return to profitability. The beginning of 2024 saw the culmination of the leadership restructure which continued the momentum of 2023 leading to another profitable year, broadly in line with expectations.
In July 2024, DCA was able to add further stability by moving into a new architectural studio and immediately feeling the enhanced benefits of a permanent home. The new space allows the practice to be dynamic and continue the improvement and rigour of the design process throughout the studio floors, cultivating a culture of hospitality, optimising the physical environment around the project teams and enhancing engagement with clients.
We continue to invest in people, process and knowledge, enabling us to provide our clients with an exceptional service in multiple sectors and regions around the globe. The engagement and investment in employees and events are in support of wellbeing and the development of everyone in the practice. Our continued investment in digital transformation and knowledge along with continuous improvement has contributed to process improvements and better working methods throughout the practice.
We also continue to drive our commitment to sustainable design as demonstrated through our projects and most recently evident in the renovation and reuse of the LSE Firoz Lalji Global Hub in London which received planning permission and began deconstruction in 2024. The project represents an innovative approach to re-use that moves beyond pure heritage and conservation concerns and recognises that buildings should be protected for their material quality and their physical capital.
KEY PERFORMANCE INDICATORS ('KPIS')
The key performance indicators are turnover, gross profit margin and fees per architect head:
Turnover - £14,764,998 (2023: £16,075,941)
Gross profit margin - 51% (2023: 54%)
Fees per architect head - £191,753 (2023: £184,781)
Turnover decreased in the year as a significant project stalled, however, the company was able to adjust costs, assisted by an internal budgetary control system and process. Globally, existing international projects of varying scale and scope presented some challenges, however, continuation of fees was ensured.
Total staff numbers stood at an average of 109 (121 in 2023). Average architectural staff numbers decreased to 77 (87 in 2023).
PROJECTS
We continue to build strong collaborative relationships with clients, consultants, contributors and contractors to develop architectural responses that respond to local climate, terrain and culture, whilst continuing to make a meaningful contribution to daily public life, and the natural and built environment.
In 2024, construction started on the restoration and conservation of the iconic Jenners building, Edinburgh. In May the ground-breaking ceremony on the K-project in Seoul took place and we were proud to achieve planning permission on the LSE Firoz Lalji Global Hub in London, passing a milestone on this important new building, which is expected to be an exemplar of both educational and sustainable design. Our completed projects in the year were the Hertogensite residences in Leuven, Belgium and the Lyon Confluence project in France, consisting of three blocks containing a range of housing tenures, offices and a health centre.
As well as other worldwide projects continuing through design stages such as an experimental mixed use and public realm development in Dubai, with community-focused amenities, apartments, hotel, and significant public space, we also undertook various pre-concept studies with the next stages likely coming to fruition in 2025. The end of 2024 saw us shortlisted in the final five of the competition for the redevelopment of the British Museum Western Range project.
FORWARD LOOKING
We continue to monitor and target opportunities in the UK and the rest of the world to ensure we sustain our order book target but remain cautious in our forecast for 2025.
2025 will be David Chipperfield Architects 40th anniversary, coinciding with the release of a new set of DCA monographs showcasing and celebrating selected works not only of our London practice, but also those of our sister companies in Europe and Asia and Sir David Chipperfield’s foundation based in Spain. Both are exciting milestones for Sir David Chipperfield, the company and all the employees who have contributed to the practice and our projects over the years and continue to underline our commitment to exceptional design and sustainable practices in architecture.
PRINCIPAL RISKS AND UNCERTAINTIES
The directors consider these to be as follows:
Geopolitics
Heightened geopolitical tensions, alongside other factors can have a significant impact on the business with little warning. We continue to monitor factors and any potential impact on the business.
Input costs
We monitor all our costs regularly and factor in inflation when modelling within our financial forecasts.
Fluctuations in contracts and workload
The practice needs to navigate continuously evolving project programmes while maintaining an excellent workforce ready for new projects and often with increasing scope. It is challenging to resource each project correctly and to react to downturns promptly, without compromising efficiency in the final stages of projects. To manage this risk, and the risk it poses on liquidity and cash flow, resource planning is considered on a weekly basis looking forward 12 months.
Architectural staff
The objectives of the practice can only be met by maintaining a strong, competent and DCA-experienced staff so staff retention and appropriate remuneration packages are essential, supplemented by CPDs and other benefits.
Claims
As a provider of design services the Company is at risk of professional negligence claims and we have a duty to inform our Professional Indemnity Insurers when such claims, or threat of claims, exist. The directors, our insurers and their legal teams will vigorously defend such claims. The directors will take all the known facts of each such case into consideration and will come to a decision, supported by professional advice obtained, on the likely outcome. If liability is considered probable a provision will be made in the accounts.
Competitions
Competitions are costly and will not always be successful. The directors are diligent in only embarking on competitions selected on the basis of clear criteria and only a limited number per year, subject to the availability of resource.
Fee proposals/timelines
Experienced staff and the directors work on the agreement of fees and timelines with prospective clients and also for new work or amendments to current projects. These fees and timelines are entered into the project management system for close monitoring during the course of the projects. Without the experience, skills and continual review at a senior management level our project performance could be significantly affected.
Exchange rates
The company has a number of contracts denominated in non-sterling currencies. The company manages its exposure to foreign exchange movements by converting significant foreign currency cash balances into sterling as soon as possible.
Approved by the Board of Directors and signed on its behalf by:
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Graeme Laughlan
Director |
The directors present their annual report on the affairs of the Company, together with the financial statements and auditors’ report, for the financial year ended 31 December 2024.
PRINCIPAL ACTIVITIES
GOING CONCERN
REVIEW OF THE BUSINESS
Turnover for the financial year amounted to £14,764,998 (2023: £16,075,941). The Company earned a profit after taxation totalling £1,389,678 (2023: £2,125,214).
The net current asset position of the Company as at the financial year end amounted to £4,356,912 (2023: net current asset £3,898,190).
The net asset position of the Company as at the financial year end amounted to £5,095,304 (2023: net asset £4,230,626).
DIVIDENDS
The directors paid a dividend of £525,000 in the current financial year (2023: £Nil).
EVENTS AFTER THE BALANCE SHEET DATE
There were no material post balance sheet events.
RESEARCH AND DEVELOPMENT
The Company continues to engage in research and development activities when required by an individual project. The intellectual property remains vested in the practice and can then be carried over to other projects.
DIRECTORS
The directors, who served during the financial year and to the date of this report except as noted, were as follows:
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(Appointed 20 January 2025) |
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(Appointed 20 January 2025) |
MATTERS COVERED IN THE STRATEGIC REPORT
Certain matters which are required to be disclosed in the directors' report have been omitted as they are included in the strategic report on pages 3 - 5. These matters relate to the principal activity and financial risk.
AUDITOR
Each of the persons who is a director at the date of approval of this report confirms that:
* So far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware; and
* The director has taken all the steps that they ought to have taken as a director in order to make himself/herself aware of any relevant audit information and to establish that the Company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of s418 of the Companies Act 2006.
A resolution to reappoint Praxis as auditors will be proposed at the forthcoming Annual General Meeting.
Approved by the Board of Directors and signed on its behalf by:
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Graeme Laughlan
Director |
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law 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), including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”. 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 Company and of the profit or loss of the Company for that financial 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; and
* Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. The directors are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Report on the audit of the financial statements
In our opinion the financial statements of David Chipperfield Architects Limited. (the 'Company'):
* Give a true and fair view of the state of the Company's affairs as at 31 December 2024 and of its profit for the financial year then ended;
* Have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”; and
* Have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements which comprise:
* The Profit and Loss Account;
* The Balance Sheet;
* The Statement of Changes in Equity; and
* The related notes 1 to 23.
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
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 Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the Financial Reporting Council's (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 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.
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 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 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.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
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 considered the nature of the Company’s industry and its control environment, and reviewed the Company’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities.
We obtained an understanding of the legal and regulatory framework(s) that the Company operates in, and identified the key laws and regulations that:
* had a direct effect on the determination of material amounts and disclosures in the financial statements. These included UK GAAP and the Companies Act 2006; and
* do not have a direct effect on the financial statements but compliance with which may be fundamental to the Company’s ability to operate or to avoid a material penalty.
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk 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.
In addition to the above, our procedures to respond to the risks identified included the following:
* reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
* performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
* enquiring of management and in-house legal counsel concerning actual and potential litigation and claims, and instances of non-compliance with laws and regulations; and
Report on other legal and regulatory requirements
Opinions 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 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.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified any material misstatements in the Strategic Report or the Directors' Report.
Under the Companies Act 2006 we are required to report in respect of the following matters if, in our opinion:
* Adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
* The 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.
Use of our report
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work, for this report, or for the opinions we have formed.
For and on behalf of
Statutory Auditor
London
EC2R 8EJ
| Note | 2024 | 2023 | ||
| £ | £ | |||
| Turnover | 3 |
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| Cost of sales | (
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| Gross profit |
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| Administrative expenses | (
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| Operating profit |
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| Interest receivable and similar income | 4 |
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| Interest payable and similar expenses | 4 | (
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| Profit before taxation | 5 |
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| Tax on profit | 9 | (
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| Profit for the financial year |
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There were no items of other comprehensive income or losses for the current or prior year other than those included in the Profit and Loss Account, accordingly no Statement of Comprehensive Income is presented.
| Note | 2024 | 2023 | ||
| £ | £ | |||
| Fixed assets | ||||
| Tangible assets | 11 |
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| Investments | 12 |
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| 973,497 | 737,201 | |||
| Current assets | ||||
| Debtors | 13 |
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| Cash at bank and in hand |
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| 9,133,430 | 8,720,770 | |||
| Creditors: amounts falling due within one year | 14 | (
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| Net current assets | 4,356,912 | 3,898,190 | ||
| Total assets less current liabilities | 5,330,409 | 4,635,391 | ||
| Creditors: amounts falling due after more than one year | 15 | (
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| Provision for liabilities | 16 | (
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| Net assets | 5,095,304 | 4,230,626 | ||
| Capital and reserves | 19 | |||
| Called-up share capital |
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| Profit and loss account |
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| Total shareholder's funds | 5,095,304 | 4,230,626 |
The financial statements of David Chipperfield Architects Limited. (registered number:
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Graeme Laughlan
Director |
| Called-up share capital | Profit and loss account | Total | |||
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| Dividends paid on equity shares |
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The principal accounting policies are summarised below. They have all been applied consistently throughout the financial year and to the preceding financial year, unless otherwise stated.
David Chipperfield Architects Limited (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is 22 Little Portland Street, London, England, W1W 8BU.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain items at fair value, and in accordance with Financial Reporting Standard 102 (FRS 102) applicable in the UK and Republic of Ireland issued by the Financial Reporting Council and the requirements of the Companies Act 2006.
The financial statements are presented in pounds sterling which is the functional currency of the Company and rounded to the nearest £.
David Chipperfield Architects Limited meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it. Exemptions have been taken in relation to share-based payments, financial instruments, presentation of a Cash Flow Statement and remuneration of key management personnel.
The Board considers the impact of changes in the economic climate through several stress tests to assess the ability of the Company to continue as a going concern. The Directors have prepared cash flow forecasts projecting into 2025 which are reviewed on an ongoing basis as the needs of the business are monitored closely by management.
These forecasts reflect an assessment of current and future market conditions and their impact on future cash flow performance. There is currently a strong value under contract, with 2024 expected to show consistency along with cash growth, putting the Company in a stronger position while also continuing to monitor costs.
Work under contract and prospective projects are reviewed regularly against resourcing levels. In addition, a comprehensive review of project performance is carried out monthly. Prospective projects are reviewed and tracked regularly through new project meetings.
Group accounts exemption s400
The Company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
The Company meets the definition of a qualifying entity under FRS102 and has therefore also taken advantage of the disclosure exemption available to it in respect of its separate financial statements and has not presented a cashflow statement.
In the current year, the following new and revised standards and interpretations have been adopted by the company and have had an effect on future periods.
At the date of authorisation of these financial statements, the following standards and interpretations, which have not yet been applied in these financial statements, were in issue but not yet effective:
Exchange differences are recognised in the Profit and Loss Account in the period in which they arise.
Revenue is recognised as contract activity progresses so that for incomplete contracts it reflects the partial performance of the contractual obligations. For such contracts the amount of revenue reflects the accrual of the right to consideration by reference to the value of work performed. Revenue not billed to clients is included in accrued income and payments on account in excess of the relevant amount of revenue are included in deferred income.
Where a contract is deemed to be onerous, a provision is recorded within the financial statements for the loss expected on that contract.
Short term benefits
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised as an expense when the Company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Defined contribution schemes
For defined contribution schemes the amounts charged to the Profit and Loss Account in respect of pension costs and other post-retirement benefits are the contributions payable in the financial year. Differences between contributions payable in the financial year and contributions actually paid are shown as either accruals or prepayments in the Balance Sheet.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date.
Deferred taxation is provided at appropriate rates on all material timing differences using the liability method only to the extent that, in the opinion of the directors, there is a reasonable probability that a liability or asset will crystallise in the foreseeable future. Deferred tax assets and liabilities are not discounted.
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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 credited or charged to profit or loss.
The Company as lessee
Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.
Assets, other than those measured at fair value, are assessed for indicators of impairment at each Balance Sheet date. If there is objective evidence of impairment, an impairment loss is recognised in the Profit and Loss Account as described below.
Investments are recognised initially at fair value which is normally the transaction price excluding transaction costs. Subsequently, they are measured at cost less impairment.
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.
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 Company after deducting all of its liabilities.
Financial assets and liabilities are only offset in the Balance Sheet when, and only when there exists a legally enforceable right to set off the recognised amounts and the Company intends either 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 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.
Financial assets are derecognised when and only when the contractual rights to the cash flows from the financial asset expire or are settled, or the Company transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or the Company, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party.
Basic financial 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
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 and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
Equity instruments
Equity instruments issued by the Company are recorded at the fair value of cash or other resources received or receivable, net of direct issue costs. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the Company.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the Balance Sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.
As a provider of design services, the Company is at risk of professional negligence claims and we have a duty to inform our Professional Indemnity Insurers when such claims, or threat of claims, exist. The directors, our insurers and their legal teams will vigorously defend such claims. The directors will take all the known facts of each such case into consideration and will come to a decision, supported by professional advice obtained, on the likely outcome. If liability is considered probable a provision, to the extent we are liable, which is the excess value of the insurance policy, will be made in the financial statements.
The cost of architects involved in projects is considered as a cost of sale, whereas the cost of administration and support staff are considered as an administrative expense.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the financial year in which the estimate is revised if the revision affects only that period, or in the financial year of the revision and future periods if the revision affects both current and future periods.
Critical judgements in applying the Company’s accounting policies
The following are the critical judgements, apart from those involving estimations (which are dealt with separately below), that the directors have made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements.
The assessment of the stage of completion of projects and therefore the amount of revenue recognised is affected by the assessment of future time costs that each project will incur through to completion. The costing of this time assessment is systematically driven but the estimation is made by project teams under supervision of directors and carries an inherent risk of being misjudged. Where a project is forecast to be loss making, provision is made for the estimated future costs to complete.
The Company’s policy on recognising an impairment of the trade debtor balance is based on a review of individual debtor balances, their ageing and management's assessment of realisation. This review and assessment is conducted on a continuing basis and any material change in management's assessment of trade debtor impairment is reflected in the carrying value of the asset.
Breakdown by geographical market:
An analysis of the Company's turnover by geographical market is set out below.
| 2024 | 2023 | ||
| £ | £ | ||
| UK | 2,174,118 | 2,933,130 | |
| Europe | 930,683 | 1,477,766 | |
| North America | 7,100,803 | 7,353,153 | |
| Middle East | 4,457,926 | 3,520,355 | |
| Rest of World | 101,468 | 791,537 | |
| 14,764,998 | 16,075,941 |
| 2024 | 2023 | ||
| £ | £ | ||
| Interest receivable and similar income |
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| Interest payable and similar expenses | (
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| (29,328) | (84,116) |
Profit before taxation is stated after charging/(crediting):
| 2024 | 2023 | ||
| £ | £ | ||
| Depreciation of tangible fixed assets (note 11) |
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| Foreign exchange losses |
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An analysis of the auditor's remuneration is as follows:
| 2024 | 2023 | ||
| £ | £ | ||
| Fees payable to the Company’s auditor and its associates for the audit of the Company's annual financial statements: | 31,000 | 31,000 | |
| Total audit fees |
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Fees payable to Praxis and its associates for non-audit services to the Company are not required to be disclosed because the consolidated financial statements are required to disclose such fees on a consolidated basis.
| 2024 | 2023 | ||
| Number | Number | ||
| The average monthly number of employees (including directors) was: | |||
| Support |
|
|
|
| Architects |
|
|
|
|
|
|
Their aggregate remuneration comprised:
| 2024 | 2023 | ||
| £ | £ | ||
| Wages and salaries |
|
|
|
| Social security costs |
|
|
|
| Other retirement benefit costs |
|
|
|
| 7,416,882 | 7,436,595 |
| 2024 | 2023 | ||
| £ | £ | ||
| Directors' emoluments |
|
|
|
| Amounts receivable (other than shares and share options) under long-term incentive schemes |
|
|
|
| 630,241 | 877,344 |
Remuneration of the highest paid director
| 2024 | 2023 | ||
| £ | £ | ||
| Director's emoluments | 195,153 | 218,813 | |
| Company contributions to money purchase schemes | 1,120 | 24,510 | |
| 196,273 | 243,323 |
The highest paid director did not exercise any share options in the year and had no shares receivable under long-term incentive schemes.
| 2024 | 2023 | ||
| £ | £ | ||
| Current tax on profit | |||
| UK corporation tax |
|
(
|
|
| Total current tax |
|
(
|
|
| Deferred tax | |||
| Origination and reversal of timing differences |
|
|
|
| Total deferred tax |
|
|
|
| Total tax on profit |
|
(
|
The tax assessed for the year is lower than (2023: lower than) the standard rate of corporation tax in the UK:
| 2024 | 2023 | ||
| £ | £ | ||
| Profit before taxation | 1,721,087 | 2,031,878 | |
| Tax on profit at standard UK corporation tax rate of 25% (2023: 25%) |
|
|
|
| Effects of: | |||
| Group relief surrender claim | 0 | 63,574 | |
| Payment for group relief | 0 | (120,776) | |
| Deferred tax movement | 8,017 | 27,440 | |
| Expenses not deductible for tax purposes | 93,009 | 96,652 | |
| Capital allowances in excess of depreciation | (116,990) | (270,475) | |
| Other deductions and reliefs | (17,607) | (5,914) | |
| Utilisation of losses | 0 | (391,807) | |
| Research and Development Tax Credit | (65,292) | 0 | |
| Total tax charge/(credit) for year | 331,409 | (93,336) |
| Trademarks, patents and licences |
Total | ||
| £ | £ | ||
| Cost | |||
| At 01 January 2024 |
|
|
|
| Disposals | (
|
(
|
|
| At 31 December 2024 |
|
|
|
| Accumulated amortisation | |||
| At 01 January 2024 |
|
|
|
| Disposals | (
|
(
|
|
| At 31 December 2024 |
|
|
|
| Net book value | |||
| At 31 December 2024 |
|
|
|
| At 31 December 2023 |
|
|
| Land and buildings |
Leasehold improve- ments |
Plant and machinery | Fixtures and fittings | Total | |||||
| £ | £ | £ | £ | £ | |||||
| Cost | |||||||||
| At 01 January 2024 |
|
|
|
|
|
||||
| Additions |
|
|
|
|
|
||||
| At 31 December 2024 |
|
|
|
|
|
||||
| Accumulated depreciation | |||||||||
| At 01 January 2024 |
|
|
|
|
|
||||
| Charge for the financial year |
|
|
|
|
|
||||
| At 31 December 2024 |
|
|
|
|
|
||||
| Net book value | |||||||||
| At 31 December 2024 | 231,462 | 243,074 | 314,390 | 184,471 | 973,397 | ||||
| At 31 December 2023 | 237,349 | 0 | 484,077 | 15,675 | 737,101 |
Assets held under finance leases
Included in plant and machinery are fixed assets held under finance leases with a net book value of £69,372 (2023 - £272,234).
Investments in subsidiaries
| 2024 | |
| £ | |
| Cost | |
| At 01 January 2024 |
|
| At 31 December 2024 |
|
| Carrying value at 31 December 2024 |
|
| Carrying value at 31 December 2023 |
|
Investments in shares
| Name of entity | Registered office | Principal activity | Class of shares |
Ownership 31.12.2024 |
Ownership 31.12.2023 |
|
|
22 Little Portland Street, London, England, W1W 8BU | Service company |
|
|
|
| 2024 | 2023 | ||
| £ | £ | ||
| Trade debtors |
|
|
|
| Amounts owed by Group undertakings (note 21) |
|
|
|
| VAT recoverable |
|
|
|
| Other debtors |
|
|
|
| Prepayments and accrued income |
|
|
|
|
|
|
| 2024 | 2023 | ||
| £ | £ | ||
| Bank loans |
|
|
|
| Obligations under finance leases and hire purchase contracts |
|
|
|
| Trade creditors |
|
|
|
| Amounts owed to Group undertakings (note 21) |
|
|
|
| Deferred tax liability |
|
|
|
| Taxation and social security |
|
|
|
| VAT |
|
|
|
| Accruals and deferred income |
|
|
|
| Other creditors |
|
|
|
|
|
|
| 2024 | 2023 | ||
| £ | £ | ||
| Bank loans and overdrafts |
|
|
|
| Obligations under finance leases and hire purchase contracts |
|
|
|
|
|
|
| Bank loans | |||
| 2024 | 2023 | ||
| £ | £ | ||
| Between one and two years |
|
|
|
| Between two and five years |
|
|
|
| After five years |
|
|
|
|
|
|
||
| On demand or within one year |
|
|
|
| 145,834 | 924,239 |
| Finance leases | |||
| 2024 | 2023 | ||
| £ | £ | ||
| Between one and two years |
|
|
|
| Between two and five years |
|
|
|
| After five years |
|
|
|
|
|
|
||
| On demand or within one year |
|
|
|
| 187,048 | 304,401 |
| Total borrowings including finance leases | |||
| 2024 | 2023 | ||
| £ | £ | ||
| Between one and two years |
|
|
|
| Between two and five years |
|
|
|
|
|
|
||
| On demand or within one year |
|
|
|
| 332,882 | 1,228,640 |
| Other | Total | ||
| £ | £ | ||
| At 01 January 2024 |
|
81,156 | |
| Credited to the Profit and Loss Account | (
|
( 13,187) | |
| At 31 December 2024 |
|
67,969 | |
The provision relates to contract losses. The provision has been recognised in accordance with the requirements of Section 21 of FRS 102 ("Provisions and Contingencies") and reflects the best estimate of the expenditure required to settle the present obligation at the balance sheet date.
Deferred tax
| 2024 | 2023 | ||
| £ | £ | ||
| Provision for deferred tax |
|
|
| 2024 | 2023 | ||
| £ | £ | ||
| At the beginning of financial year | (
|
(
|
|
| Charged to the Profit and Loss Account | (
|
(
|
|
| At the end of financial year | (
|
(
|
The carrying values of the Company’s financial assets and liabilities are summarised by category below:
| 2024 | 2023 | ||
| £ | £ | ||
| Financial assets | |||
| Measured at undiscounted amount receivable | |||
| Trade debtors (note 13) |
|
|
|
| Other debtors (note 13) |
|
|
|
| Amounts owed by Group undertakings (note 13) |
|
|
|
| 3,777,620 | 4,347,416 | ||
| Financial liabilities | |||
| Measured at amortised cost | |||
| Bank loans and other loans | (
|
(
|
|
| Obligations under finance leases | (
|
(
|
|
| Measured at undiscounted amount payable | |||
| Trade creditors (note 14) | (
|
(
|
|
| Amounts owed to Group undertakings (note 14) |
|
(
|
|
| (707,438) | (1,958,080) |
| 2024 | 2023 | ||
| £ | £ | ||
| Allotted, called-up and fully-paid | |||
|
|
|
|
|
| Presented as follows: | |||
| Called-up share capital presented as equity | 43,635 | 43,635 |
The profit and loss reserve represents cumulative profits or losses, net of dividends paid and other adjustments.
Commitments
Total future minimum lease payments under non-cancellable operating leases are as follows:
| 2024 | 2023 | ||
| £ | £ | ||
| within one year |
|
|
|
| between one and five years |
|
|
|
| after five years |
|
|
|
|
|
|
The Company has availed of the exemption provided in FRS 102 Section 33 Related Party Disclosures not to disclose transactions entered into with fellow group companies that are wholly owned within the group of companies of which the Company is a wholly owned member.
During the year the company incurred costs of £298,478 (2023 - £21,587) for services provided by a company under common control. At the balance sheet date the company owed nil (2023 - £7,452) to a company under common control.
During the year the company purchased architectural consultancy services from a company under the control of a close family member of the director totalling £204,308 (2023 - £328,622). At the year end the amounts due to a connected party of £nil (2023 - £176,785).
The immediate and ultimate controlling party is DC Studio Limited. The largest and smallest group of undertakings for which consolidated accounts are drawn up and in which the Company is included, is the group headed by DC Studio Limited. Copies of the group financial statements are available from Companies House, Cardiff, CF14 3UZ. The registered office of DC Studio Limited is C/O Praxis, 1 Poultry, London, England, EC2R 8EJ.
Sir David Chipperfield, a director of David Chipperfield Architects Limited, has ultimate control of the company by virtue of the ownership of the issued ordinary shares of DC Studio Limited.