The directors present the strategic report for the year ended 30 June 2024.

Model and markets

Desk Top Publishing Micro Systems Limited, trading as DTP Group, designs, delivers and supports IT infrastructure, managed services, and hybrid cloud solutions, and services that together help clients achieve significant returns from their IT investment, and with a particular focus on delivering real business outcomes.

While we continue to develop and grow the transactional business we do in our existing clients, while winning new ones, it is the growth of our Managed Service, Software as a Service (SaaS), and as a Service (aaS) business across all divisions that continues to be our prime focus, and which generates multi-year annuity revenues. While our End User Computing business continues to operate as a transactional model within procurement frameworks, this model also continues to transition to an 'as a Service' provision and has become a UK leader in the area of Digital Employee Experience (DEX) Software, delivered within a Software as a Service model.

The business is active in a wide cross-section of vertical markets within the commercial sector, while in the public sector DTP’s predominant vertical has been higher education, although it is now expanding across the wider public sector leveraging its place within the Crown Commercial Services Technology Products 2, and other Public Sector frameworks.

Size and complexity

DTP is a medium sized business, employs over 70 people across the UK and operates in several vertical markets as a strategic partner - and one of the few UK&I top tier partners - for both Hewlett-Packard Enterprise (HPE) and HP Inc. (HP).

The business continues to dedicate itself to these brands and differentiates itself by its investment in being an HPE and HP only expert.

DTP provides customers with:

• industry leading levels of technical and operating model modernisation expertise

• high levels of customer service

• demonstrable returns on investment.

DTP operates three Divisions:

• Managed Print Services & AV

• Data Centre Infrastructure/Hybrid Cloud & Campus Networking

• End User Compute

The business continues to maintain its position as a leading expert in HPE and HP technologies on key public sector procurement frameworks, and continues to be recognised globally by both vendors through the following forums:

• HPE world-wide Marketing Partner Advisory Board

• HP world-wide Services Partner Advisory Board.    

DTP’s Environmental IT expertise is recognised as sector-leading, and it continues to drive and grow its industry leading IT Asset Disposal (ITAD) service in partnership with both HPE and HP.

The following objectives represent the business' strategic focus:

• Maintain and grow our position as one of the top ten IT suppliers/vendors within UK Higher Education

• Continue to grow our business within the wider public sector, and higher mid-market and corporate sectors

• Continue growing our subscription/annuity-based business, especially around hybrid cloud, DEX Software as a Service, and ITAD, whilst retaining transactional sales through providing exceptional client experience

• Continue to innovate, evolve and develop differentiated service and software offerings, and create and develop Intellectual Property

• Enhance and evolve our marketing effort effectively to promote DTP as a business that delivers business outcomes for clients, and having the expertise and experience to be their go to Operating Model Modernisation partner, and taking clients on a journey that delivers competitive advantage, productivity benefits, enhanced compliance, and significant cost and environmental savings

• Ensuring the business continues to be a great and fulfilling place to work, and within which to build a career

Product and solution offerings are increasingly focused on Modernisation, removing Technical Debt, and mitigating client security concerns, and the business continues to invest in this area as a source of competitive advantage.

As more Customer IT functions are evolving into internal service providers, across the board KPls are becoming more prevalent as customers want to ensure that their IT partner is working towards the same goals and is continually working with them to adopt technology that will align to support their business and ultimately deliver customer success. This extends into the level of real time information and actionable insights that we provide to clients across operations, risk, security and environmental compliance.

Consolidation within the sector continues to accelerate at both vendor and reseller levels.

Gross Profits increased to £4,752,713. See the going concern section in the Directors report page 5 for further information.

Working capital remains positive, strong and stable. Headroom within the cash facility was robust.

The balance sheet is deemed strong enough to withstand the pressures of the growth projected in the business’ three-year plan. DTP is well placed to grow the top line and operating profits in the next financial year.

Principle risks and uncertainties

The business' growth plans present manageable risk in respect of investment in people; growth is however to be organic and profitable with no expectation of major capital spending required to continue to grow the business.

Sales in foreign exchange operate at an immaterial level. No hedging is undertaken. All purchases are made in Sterling therefore nullifying any supply related exchange and customs tariff risk.

Bad debt risk is offset due to the nature of our client base (public sector organisations or mid-market/large corporates) and by the nature of our engagements, for example – large non-public sector hardware sales utilise established third-party finance providers.

Key Performance Indicators

Service levels are managed and monitored through detailed service level agreements, which are tracked daily and used alongside a range of service metrics.

DTP continues to invest in its ESG, as well as assisting clients with their own environmental journeys.

The business’ environmental impact is managed in accordance with its ISO 14001 certification; performance against environmental objectives is published. DTP takes its environmental stewardship extremely importantly, and has launched a sub brand, DTP Zero, to help us drive both internal and external environmentally focused activities, which includes DTP becoming carbon neutral by the end of 2030. DTP has also launched a range of “Green Glove” services for its clients including environmental attach products for its clients, including a carbon offset service, allowing the carbon footprint for the products it supplies to be offset.

DTP has also launched an IT Asset Disposal Service (ITAD), to help clients dispose of their old assets into a circular economy process, where the asset is refurbished and resold, and the client benefits from a share of the resale value. This service means that over 95% of old assets are reused, ensuring minimal materials have to be sent to land fill. The rebates we provide clients on their retired equipment are significantly more than the traditional ITAD market provides, and the reporting we provide is also market leading.

The business’ Modern Slavery policy and statement are available on its website.

Employee make-up was split 82% male and 18% female, which DTP is pro-actively trying to balance.

Investment in services is supported by its inward investment in its people. DTP’s Apprenticeship and Academy Programmes continue to provide opportunities for young people to join the business, develop their skills and grow by providing them with support and access to learning and mentoring across the organisation.

On behalf of the board

The directors present their annual report and financial statements for the year ended 30 June 2024.

The principal activity of the company continued to be that of the supply and support of IT infrastructure, software and technology related managed services.

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £27,800. 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 auditor, BHP LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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). 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 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; 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. They 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.

The directors are responsible for the maintenance and integrity of the company website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

The Directors have assessed the Company’s ability to continue as a going concern and are satisfied that it remains appropriate to prepare the financial statements on a going concern basis.

The Company experienced a decline in revenue during FY24 and FY25, primarily due to reduced demand in its End-User Computing (“EUC”) division. This was driven by uncertainty and change in the higher education sector, including a reduction in overseas student numbers and the impact of the July 2024 general election and subsequent budget, which led to deferred investment in IT infrastructure.

In response, the Company has implemented cost-saving measures over the past six months and continues to operate well within the limits of its invoice discounting facility. Encouragingly, the higher education sector is showing signs of recovery, with student numbers increasing and IT spend returning to more normalised levels. Demand is also being supported by the need for refreshed technology to accommodate advancements in AI and new operating systems, and a focus on modernising their operating models.

The Company is actively developing new products and solutions to support entry into new markets and expansion of existing accounts. Forecasts prepared by management indicate a return to marginal profitability in FY26, with double-digit revenue growth expected. The forecast also demonstrates that the business will continue to operate within its existing conservative financing arrangements. Sensitised forecasts demonstrate that the Company can absorb significant adverse performance relative to both FY26 forecasts and FY25 actuals, even before considering further mitigating actions which management consider can be undertaken successfully.

Whilst the Directors acknowledge the risks associated with being able to grow sales and return the business to profitability, they are confident in the Company’s ability to deliver on its forecasts and longer-term growth plans and successfully mitigate these risks. Accordingly, the Directors have concluded that the Company remains a going concern and that none of the identified risks represent material uncertainties in relation to going concern.

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

We have audited the financial statements of Desk Top Publishing Micro Systems Limited (the 'company') for the year ended 30 June 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, 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).

In our opinion the financial statements:

• give a true and fair view of the state of the company's affairs as at 30 June 2024 and of its loss for the year then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

• have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor'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 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.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

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 material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept, 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.

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.

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.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

• the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

• we identified the laws and regulations applicable to the Company through discussions with directors and other management, and from our commercial knowledge and experience of the trade;

• we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Company;

• we assessed the extent of compliance with the laws and regulations considered above through making enquiries of management; and

• identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by;

• making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and

• considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risks of fraud through management bias and override controls, we:

• performed analytical procedures to identify any unusual or unexpected relationships;

• tested journal entries to identify unusual transactions;

• assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and

• investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

• agreeing financial statement disclosures to underlying supporting documentation;

• reading the minutes of meetings of those charged with governance;

• enquiring of management as to actual and potential litigation and claims; and

• discussions with senior management regarding relevant regulations and reviewing the company’s legal and professional fees.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the director’s and other management and the inspection of regulatory and legal correspondence.

As part of our audit, we addressed the risk of management override of internal controls, including testing of journals and review of the nominal ledger. We evaluated whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

Desk Top Publishing Micro Systems Limited is a private company limited by shares incorporated in England and Wales. The registered office is DTP House Unit 3, Castleton Road, Leeds, LS12 2EN.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The Directors have assessed the Company’s ability to continue as a going concern and are satisfied that it remains appropriate to prepare the financial statements on a going concern basis.true

The Company experienced a decline in revenue during FY24 and FY25, primarily due to reduced demand in its End-User Computing (“EUC”) division. This was driven by uncertainty and change in the higher education sector, including a reduction in overseas student numbers and the impact of the July 2024 general election and subsequent budget, which led to deferred investment in IT infrastructure.

In response, the Company has implemented cost-saving measures over the past six months and continues to operate well within the limits of its invoice discounting facility. Encouragingly, the higher education sector is showing signs of recovery, with student numbers increasing and IT spend returning to more normalised levels. Demand is also being supported by the need for refreshed technology to accommodate advancements in AI and new operating systems, and a focus on modernising their operating models.

The Company is actively developing new products and solutions to support entry into new markets and expansion of existing accounts. Forecasts prepared by management indicate a return to marginal profitability in FY26, with double-digit revenue growth expected. The forecast also demonstrates that the business will continue to operate within its existing conservative financing arrangements. Sensitised forecasts demonstrate that the Company can absorb significant adverse performance relative to both FY26 forecasts and FY25 actuals, even before considering further mitigating actions which management consider can be undertaken successfully.

Whilst the Directors acknowledge the risks associated with being able to grow sales and return the business to profitability, they are confident in the Company’s ability to deliver on its forecasts and longer-term growth plans and successfully mitigate these risks. Accordingly, the Directors have concluded that the Company remains a going concern and that none of the identified risks represent material uncertainties in relation to going concern.

Turnover represents amounts receivable for goods and services, net of VAT and trade discounts. Sales of IT hardware and software are recognised on delivery of goods and sales of technology services are recognised when the service is performed.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on delivery of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably.

Revenue is primarily comprised of income from:

- Enterprise Group;

- Managed Print Services; and

- End user computing (EUC).

Revenue from Enterprise Group relates to the sale of infrastructure services such as servers, data storage and other technology products and the point of recognition for sale is once the order has been dispatched and goods delivered to the customer.

Revenue from Managed Print Services relates to the sale and/or usage of multi function printers. The recognition for sale of the printers is once an order has been dispatched and goods delivered to the customer. Usage of toners is once the toners are consumed and this is invoiced monthly in arrears.

Revenue from End user computing relates to the sale of laptops, desktops, screens and other IT equipment. The point of recognition for sale is once the order has been dispatched and goods delivered to the customer.

Rebates receivable are recognised when it is probable that the economic benefits will flow to the company and the amount of revenue can be measured reliably.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

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.

At each reporting period end date, the company reviews the carrying amounts of its tangible 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.

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.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with 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 company 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 company 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 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company 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 company.

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 year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’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 when the company has 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.

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

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.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

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 leases 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.

Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

In the application of the company’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.

Outstanding trade debtor balances are reviewed on a line by line basis by management to identify possible amounts where a provision is required. Management closely manage the collection of trade debtors and therefore are able to identify balances where there is uncertainty about its recoverability, and determine what provision is required (if any). The directors are of the opinion that no bad debt provision is required in either the current or comparative year.

At each reporting date an assessment is made for provisions required to recognise a fair valuation of damaged, slow moving or obsolete stock. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in the profit or loss and provided for in the balance sheet. Reversals of impairment losses are also recognised in profit or loss when they arise. The directors are of the opinion that no stock provision is required in either the current or comparative year.

Rebates receivable are recognised in the period of the associated sale. Judgement is required by management to determine a reliable estimate of the amount receivable, this is applied with reference to historical transactions and understanding of the contract terms.

Given the entity’s recent loss-making performance, management has assessed future profitability based on strategic forecasts. These include assumptions about, revenue growth and market recovery. The forecasts support the recognition of the asset.

The average monthly number of persons (including directors) employed by the company during the year was:

Their aggregate remuneration comprised:

In the opinion of the directors there are no key management personnel other than the directors themselves.

The actual credit for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:

Included within Current liabilities, other creditors of £576,109 (2023: £1,017,444) which relate to an invoice finance facility. The discount charge is 2% above base rate, with a £2,500 monthly minimum fee. The finance is secured by fixed and floating charges over the assets of the company.

In 2021, the company took out a loan to the amount of £500,000. This loan is supported by the Government Coronavirus Business Interruption Loan scheme ("CBILS"). The loan is repayable by monthly installments commencing October 2021 with an interest rate 3.15% above the base rate.

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

The deferred tax asset set out above is expected to reverse within the foreseeable future and relates to the utilisation of tax losses against future expected profits of the same period.

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.

Contributions totalling £17,205 were owed by the company (2023: £16,026) to the fund at the year end date and are included in creditors.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

The remuneration of key management personnel is as follows.

Dividends totalling £27,800 (2023 - £74,881) were paid in the year in respect of shares held by the company's directors.

The company is controlled by Mr H J Hall, a director of the company.