REGISTERED NUMBER: 03933476 (England and Wales)

Strategic Report, Report of the Directors and

Audited Financial Statements

for the Year Ended 31 December 2024

for

Air Handling Systems Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Statement of Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Statement of Cash Flows

12

Notes to the Statement of Cash Flows

13

Notes to the Financial Statements

14

DIRECTORS:

Mr L H Johnson

Mr R W Campbell

Mr W Hodgson

Mr R M Taylor

Mr J I Gray

Mr M S Chape

Mrs J A Holmes

REGISTERED OFFICE:

3/5 Furnace Industrial Estate

Shildon

Co. Durham

DL4 1QB

REGISTERED NUMBER:

03933476 (England and Wales)

SENIOR STATUTORY AUDITOR:

Moganarden Chelvanaigum

AUDITORS:

SKS Audit LLP

3 Sheen Road

Richmond Upon Thames

TW9 1AD

INTRODUCTION

The directors present their strategic report of the company for the period 01 January 2024 to 31 December 2024.

PRINCIPAL ACTIVITIES

Principal activity of the company for the year under review was that of manufacturing of air handling units.

REVIEW OF BUSINESS

The results for the company show a pre-tax profit of £1,201,879 (2023 : £1,091,475) and turnover of £13,872,263 (2023 : £13,231,580). Operating profit for the year is £1,196,020 (2023 : £1,095,853). Administrative expenses were £2,185,407 (2023 : £1,724,509). However, the company will continue to focus on cost monitoring in response to the difficult future market conditions.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks and uncertainties facing the company are reviewed in detail by the directors and no material additional risk or uncertainty has been identified other than those detailed below. These risks are broadly accompanied with competitive, operational and financial risks. The directors risk management objectives consist of identifying and monitoring those risks which could have an adverse impact on the company assets, profitability or cash flows.

Credit risk is managed by regular credit checks on its customers and by monitoring accounts receivable. On specific contracts and to further mitigate risk, the company employs credit risk insurance.

Competitive risk

The markets remain competitive with price and margin fluctuation, which are dependent on relationships with key suppliers. Additionally, the uncertain surrounding the economy due to the direct result of the United Kingdom's exit remain prominent factors factoring affecting the sector.

Operational risk

The main operational risk relating to the company's operations are through relationships with the customers and quality of products to client specifications. The company's ability to provide products to its customers depends on maintaining relationship. The overall risk is mitigated by ensuring that the orders are delivered to client's specification and quality products to the company to enable operations to grow.

Price risk

The company's exposure to price risk is based on its target to introduce energy efficient products to its customers. The fluctuation has impact on the company margins and profitability. There is also some exposure product price risk based on its operations. The directors manage exposure based on working with its suppliers and controlling purchasing volumes and providing high level of service to customers. The directors ensure they review and manage their policies to control the level of risk through diversification of products they provide.

Foreign exchange risks

As a matter of policy, the company choose not to currently use financial derivatives or currency hedging to manage its exposure and the directors review exposures to risk and review currency fluctuations on an ongoing basis to ensure any adverse effect limited.

Credit risk

The company's principal financial assets are bank balances, trade and other receivables. The company's credit risk is primarily attributable to its trade receivables and balances from the related parties. The company gives significant attention to credit risk and manages the risk though credit control procedures to ensure that credit risk is at an acceptable level for its future operations.

Liquidity Risk

Liquidity risk is the risk that insufficient working capital will be generated by the company's business activities and that in this event suitable sources of funding may not be available. The company ensures that sufficient cash is available to fund on-going operations and has sufficient cash reserves for its operations. The company controls this risk by maintaining appropriate inventory levels by operating a policy of buying inventory against confirmed customer orders and also exercises effective credit management.

FINANCIAL KEY PERFORMANCE INDICATORS

The directors of the company use a variety of financial performance indicators, including turnover, total operating profit, profit after tax, shareholders fund and average employees. These are reviewed and assessed quarterly by the board and appropriate action taken to ensure growth targets are being achieved.

The company's key financial and non-performance indicator for the year are as follows:

Particulars

2024

2023

(£)

(£)

Turnover

13,872,263

13,231,580

Operating profit

1,196,020

1,095,853

Profit after tax

828,323

808,754

Shareholders' funds

1,589,992

1,871,764

Average employees

72

69

FINANCIAL INSTRUMENTS

The company has a normal level of exposure to price, credit, liquidity and cash flow risks arising from trading activities which are conducted in sterling and foreign currency for which company minimise exposure to exchange rate volatility through its internal management processes.The company does not enter into any formally designated hedging arrangements.

ON BEHALF OF THE BOARD:

Mr L H Johnson - Director

29 September 2025

The directors present their report with the financial statements of the company for the year ended 31 December 2024.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of manufacturing of air handling units.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2024 is £1,110,097.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2024 to the date of this report.

Mr L H Johnson

Mr R W Campbell

Mr W Hodgson

Mr R M Taylor

Mr J I Gray

Mr M S Chape

Mrs J A Holmes

Other changes in directors holding office are as follows:

Mr L G Johnson ceased to be a director after 31 December 2024 but prior to the date of this report.

GOING CONCERN

The directors have, at the time of approving the financial statements, a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The directors have made this assessment for a period of at least one year from the date of approval of these financial statements. Accordingly, they continue to adopt the going concern basis in preparing the annual report and financial statements.

DISCLOSURE IN THE STRATEGIC REPORT

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by the Large and Medium-sized Companies and Groups (Accounts and Directors’ Report) Regulations 2008 to be contained in the directors' report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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;

-	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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, SKS Audit LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr L H Johnson - Director

29 September 2025

Opinion

We have audited the financial statements of Air Handling Systems Limited (the 'company') for the year ended 31 December 2024 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	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 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.

Other Matter

The comparative information for the year ended 31 December 2023 is unaudited.

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 Auditors' 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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.

In connection with our audit of the financial statements, 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 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 the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

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 Report of the Directors.

We have nothing to report in respect of the following matters where 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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 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.

Auditors' 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 a Report of the Auditors 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 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 a Report of the Auditors 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.

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 misstatement in respect of irregularities, including fraud.The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

• We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.

• We obtained an understanding of laws and regulations that could reasonably be expected to have a material effect on the financial statements through discussion with management and those charged with governance, including financial reporting and taxation legislation. We considered that extent of compliance with those laws and regulations as part of our procedures on the related financial statement items.

• We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations. We remained alert to any indications of non-compliance throughout the audit.

• We addressed the risk of fraud through management override by reviewing the appropriateness of a sample of journal entries and other adjustments; assessing whether the judgments made in making key accounting estimates and indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business that we come across throughout the audit.

However, the primary responsibility for the prevention and detections of fraud rests with both management and those charged with governance of the company. Our examination should not be relied upon to disclose all such material

misstatements or frauds, errors or instances of non-compliance as may exist.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. this risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involved intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

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 a Report of the Auditors 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.

Moganarden Chelvanaigum (Senior Statutory Auditor)

for and on behalf of SKS Audit LLP

3 Sheen Road

Richmond Upon Thames

TW9 1AD

29 September 2025

Turnover

13,872,263

13,231,580

Cost of sales

(10,490,836

)

(10,411,218

)

Gross profit

3,381,427

2,820,362

Administrative expenses

(2,185,407

)

(1,724,509

)

Operating profit

4

1,196,020

1,095,853

Interest receivable and similar income

12,880

-

1,208,900

1,095,853

Interest payable and similar expenses

6

(7,021

)

(4,378

)

Profit before taxation

1,201,879

1,091,475

Tax on profit

7

(373,556

)

(282,721

)

Profit for the financial year

828,323

808,754

Other comprehensive income

-

-

Total comprehensive income for the year

828,323

808,754

Fixed assets

Tangible assets

10

714,630

647,442

Current assets

Stocks

11

172,177

142,328

Debtors

12

947,378

900,731

Cash at bank and in hand

5,935,543

4,984,249

7,055,098

6,027,308

Creditors

Amounts falling due within one year

13

(6,062,805

)

(4,714,937

)

Net current assets

992,293

1,312,371

Total assets less current liabilities

1,706,923

1,959,813

Creditors

Amounts falling due after more than one year

14

(62,892

)

(88,049

)

Provisions for liabilities

16

(54,039

)

-

Net assets

1,589,992

1,871,764

Capital and reserves

Called up share capital

17

10,005

10,003

Capital redemption reserve

18

20,000

20,000

Retained earnings

18

1,559,987

1,841,761

1,589,992

1,871,764

The financial statements were approved by the Board of Directors and authorised for issue on 29 September 2025 and were signed on its behalf by:

Mr L H Johnson - Director

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2023

10,003

1,756,545

20,000

1,786,548

Changes in equity

Dividends

-

(723,538

)

-

(723,538

)

Total comprehensive income

-

808,754

-

808,754

Balance at 31 December 2023

10,003

1,841,761

20,000

1,871,764

Changes in equity

Issue of share capital

2

-

-

2

Dividends

-

(1,110,097

)

-

(1,110,097

)

Total comprehensive income

-

828,323

-

828,323

Balance at 31 December 2024

10,005

1,559,987

20,000

1,589,992

Cash flows from operating activities

Cash generated from operations

1

2,661,380

2,773,325

Interest paid

(7,021

)

(4,378

)

Tax paid

(342,404

)

(53,550

)

Net cash from operating activities

2,311,955

2,715,397

Cash flows from investing activities

Purchase of tangible fixed assets

(150,566

)

(125,784

)

Interest received

12,735

-

Net cash from investing activities

(137,831

)

(125,784

)

Cash flows from financing activities

Amount introduced by directors

-

100,000

Amount withdrawn by directors

(112,735

)

-

Share issue

2

-

Equity dividends paid

(1,110,097

)

(723,538

)

Net cash from financing activities

(1,222,830

)

(623,538

)

Increase in cash and cash equivalents

951,294

1,966,075

Cash and cash equivalents at beginning of year

2

4,984,249

3,018,174

Cash and cash equivalents at end of year

2

5,935,543

4,984,249

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2024

2023

as restated

£

£

Profit before taxation

1,201,879

1,091,475

Depreciation charges

83,378

80,314

Finance costs

7,021

4,378

Finance income

(12,880

)

-

1,279,398

1,176,167

Increase in stocks

(29,849

)

(142,328

)

Decrease in trade and other debtors

179,320

456,564

Increase in trade and other creditors

1,232,511

1,282,922

Cash generated from operations

2,661,380

2,773,325

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

5,935,543

4,984,249

Year ended 31 December 2023

31.12.23

1.1.23

as restated

£

£

Cash and cash equivalents

4,984,249

3,018,174

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.24

Cash flow

At 31.12.24

£

£

£

Net cash

Cash at bank and in hand

4,984,249

951,294

5,935,543

4,984,249

951,294

5,935,543

Total

4,984,249

951,294

5,935,543

1.	STATUTORY INFORMATION

Air Handling Systems Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

BASIS OF PREPARING THE FINANCIAL STATEMENTS

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

TURNOVER

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. Revenue is recognised upon completion of the sales order.

TANGIBLE FIXED ASSETS

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

2% on cost

Improvements to property

-

2% on cost

Plant and machinery

-

20% on cost and 15% on reducing balance

STOCKS

Work-in-progress is a total of purchases made during the year relevant to projects completed after year end.

FINANCIAL INSTRUMENTS

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

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

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.

Impairment of financial assets

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.

Derecognition of financial assets

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.

Other financial liabilities

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 though 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.

Derecognition of financial liabilities

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

TAXATION

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

DEFERRED TAX

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

HIRE PURCHASE AND LEASING COMMITMENTS

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

PENSION COSTS AND OTHER POST-RETIREMENT BENEFITS

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

CASH AND CASH EQUIVALENTS

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

TRADE DEBTORS

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors and other debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

TRADE CREDITORS

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors and other creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

INVESTMENTS

Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognized in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

GOING CONCERN

The Financial Statements of the company have been prepared on a going concern basis. The company made a profit in the year of £828,323 (2023: £808,754), has net current assets of £992,293 (2023: £1,312,371), has net assets of £1,589,992 (2023:1,871,764) and has cash at Bank and in hand of £5,935,543 (2023: £4,984,249).

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

(i) Useful economic lives of tangible assets: The annual depreciation charge for tangible assets are sensitive to changes in the estimated useful lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary.

(ii) Going concern: The directors consider the company to be a going concern, for the reasons as detailed in

accounting policies to these financial statements.

(iii) Provisions for liabilities: The directors make an estimate of the provisions for potential liabilities arising from

third parties assuming the worst case scenario.

(iv) Deferred income: Certain customers settle their invoices up-front, before completion of the sales order. The company maintains a record of such balances and releases them from deferred income as and when the sales orders are completed.

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 the period, or in the period of the revision and future periods where the revision affects both current and future periods.

3.	EMPLOYEES AND DIRECTORS

2024

2023

as restated

£

£

Wages and salaries

4,395,491

2,688,521

Social security costs

63,221

47,065

Other pension costs

162,570

131,013

4,621,282

2,866,599

The average number of employees during the year was as follows:

2024

2023

as restated

Average number of employees

72

69

2024

2023

as restated

£

£

Directors' remuneration

503,776

367,882

Information regarding the highest paid director is as follows:

2024

2023

as restated

£

£

Emoluments etc

108,900

101,758

4.	OPERATING PROFIT

The operating profit is stated after charging:

2024

2023

as restated

£

£

Hire of plant and machinery

22,972

24,567

Depreciation - owned assets

83,378

80,315

5.	AUDITORS' REMUNERATION

2024

2023

as restated

£

£

Fees payable to the company's auditors for the audit of the company's financial statements

13,000

-

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2024

2023

as restated

£

£

Hire purchase

7,021

4,378

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2024

2023

as restated

£

£

Current tax:

UK corporation tax

319,517

282,721

Deferred tax

54,039

-

Tax on profit

373,556

282,721

UK corporation tax has been charged at 25% .

RECONCILIATION OF TOTAL TAX CHARGE INCLUDED IN PROFIT AND LOSS

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2024

2023

as restated

£

£

Profit before tax

1,201,879

1,091,475

Profit multiplied by the standard rate of corporation tax in the UK of 25% (2023 - 23.520%)

300,470

256,715

Effects of:

Expenses not deductible for tax purposes

29,097

8,662

Capital allowances in excess of depreciation

(10,050

)

(36,212

)

Adjustments to tax charge in respect of previous periods

-

6

Tax provision adjustments

54,039

53,550

Total tax charge

373,556

282,721

8.

DIVIDENDS

The total distribution of dividends for the period ended 31 December 2024 is £1,110,097.

9.	PRIOR YEAR ADJUSTMENT

A prior year adjustment has been made where deferred income was incorrectly adjusted under purchases instead of sales. Additionally, deferred income and work in progress were netted and shown under "Other Creditors." These have now been reclassified appropriately to reflect accurate revenue and liability treatment.The adjustment had no effect on profit or loss.