|
Registered number: 08008548
SOCOTEC ADVISORY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
SOCOTEC ADVISORY LIMITED
COMPANY INFORMATION
|
|
N L Detchepare (resigned 14 October 2024)
|
|
|
|
|
|
|
|
|
|
|
|
M G T Marriott (appointed 14 October 2024)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
55-56 Lincoln's Inn Fields
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chartered Accountants & Statutory Auditor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
CONTENTS
|
|
|
|
|
|
|
|
|
Independent Auditors' Report
|
|
Statement of Comprehensive Income
|
|
Statement of Financial Position
|
|
Statement of Changes in Equity
|
|
Notes to the Financial Statements
|
|
|
|
SOCOTEC ADVISORY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
Socotec Advisory Limited ("the Company") is a business dedicated to providing quantity surveying services to the construction and infrastructure sectors. Our services include pre and post contract commercial management for both Contractors and Employers, commercial troubleshooting, dispute, and expert witness services where we have given evidence on the evaluation of change, loss, damages and risks in disputes and litigation in relation to a wide range of construction and infrastructure projects across the globe.
Our team includes registered quantum experts, specialist forensic analysts, forensic accountants, chartered quantity surveyors, commercial and technical experts, risk analysts, civil engineers, and construction economists.
We pride ourselves on our client-focused approach and continual drive to meet expectations using our technical expertise.
Our expert team has continued to expand significantly throughout 2024, building upon the successful integration of Socotec UK employees that commenced in April 2023. This strategic consolidation has enhanced our technical capabilities and provided our specialists with access to an increasingly diverse portfolio of high-value projects and comprehensive professional development opportunities.
The Manchester hub has matured into a significant operational centre, successfully delivering both quantity surveying and expert witness services to our growing client base across the North of England and beyond.
The Socotec Advisory Limited business model has demonstrated exceptional resilience and growth throughout 2024. Our turnover reached £9,949,036 with a gross profit of £4,142,869, reflecting strong operational performance and our ability to deliver value-added services to our clients.
Most notably, our operating profit (excluding a non-recurring bad debt provision) reached £1,644,660, representing an outstanding 84% increase on the prior year. This substantial improvement demonstrates the effectiveness of our strategic initiatives, operational efficiencies gained through the Socotec integration, and our team's ability to secure and deliver high-value engagements.
Our diverse client base has expanded significantly, with particular strength in long-term infrastructure projects and expert witness services. The business has successfully secured several major engagements that have contributed to this exceptional year-on-year performance improvement.
Expert witness services have shown robust growth, with several high-profile international disputes and litigation cases contributing substantially to our revenue and profitability. Our reputation as quantum experts continues to attract complex, high-value mandates from across the globe.
The integration into the Socotec structure has delivered substantial operational benefits throughout 2024. Under the guidance of our leadership team, we have successfully leveraged synergies across the broader Socotec group, enabling us to pursue multidisciplinary opportunities and expand our market reach.
However, the year has not been without challenges. The company has experienced significant difficulties with debt collection in certain sectors, resulting in a substantial non-recurring bad debt provision of £1,399,941, which has impacted our overall financial position despite the strong underlying operational performance. The Company continues to work hard in 2025 to recover these amounts despite them being provided for in 2024.
|
|
SOCOTEC ADVISORY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Principal risks and uncertainties
|
Like most companies, the Company is exposed to a variety of risks and actively manages them through its risk management procedures. While risk cannot be eliminated altogether, actions are taken to mitigate them wherever possible through the establishment and maintenance of key controls.
The key risks that the Company is exposed to include but are not limited to:
∙Damage to the Company's reputation as a leader in the Forensic Expert Witness sector or loss of accreditations;
∙Credit risk and client payment defaults, as evidenced by the significant bad debt provision in 2024;
∙Exposure to uninsured commercial claims and liabilities;
∙Non-compliance with relevant laws and regulations;
∙Not maintaining technical knowledge and skills;
∙Erosion of our expertise due to movement of staff; and
∙Data breaches or cyber-attacks;
The experience in 2024 has highlighted the importance of robust credit management and client assessment procedures, which the Company is actively strengthening.
Financial key performance indicators
|
The key financial measurements used within the business include revenue, gross profit margins, EBITDA, and cash generation with a focus on DSO days.
Key financial achievements for 2024 include:
∙Turnover: £9,949,036
∙Gross Profit: £4,142,869 (41.6% gross margin)
∙Operating Profit (excluding non-recurring bad debt provision): £1,644,660 representing an exceptional 84% increase on prior year
∙Operating Profit (after non-recurring bad debt provision): £244,719
∙Administrative Expenses: £4,053,676 (including £1,399,941 non-recurring bad debt provision).
The underlying business performance, excluding the impact of the non-recurring bad debt provisions, demonstrates the strength of our service offering and operational model, with operating profit increasing by 84% year-on-year.
In addition to financial parameters, the business uses several other key performance indicators ("KPIs") including full time employees (FTE), fee earner utilization, productivity, and employee retention.
The Company's results have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (UK GAAP), including Financial Reporting Standard 102 (FRS 102).
|
|
SOCOTEC ADVISORY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The exceptional 84% growth in operating profit (excluding the non-recurring bad debt provision) demonstrates the fundamental strength of our business model, financial performance and market position. This performance provides confidence in our ability to continue delivering strong results while implementing enhanced credit management procedures.
Following successful marketing initiatives across global markets including the Middle East, South America, and South Korea, we have developed a substantial pipeline of opportunities. Combined with our established long-term contracts with airports and infrastructure companies, this positions the Company well for continued growth.
We are also actively exploring opportunities to leverage insurance-based work within the UK market. This represents a significant growth opportunity, given our quantum expertise and forensic capabilities, which are highly valued in insurance claim assessments and dispute resolution. Our proven track record in construction disputes and technical analysis positions us well to expand our services to support insurance companies and their clients in complex claim scenarios.
Priority areas for 2025 include maintaining our exceptional operational performance while strengthening debt collection processes and implementing enhanced client credit assessment procedures. Our integration within the Socotec group continues to unlock opportunities for collaborative service delivery and market expansion.
This report was approved by the board and signed on its behalf.
D P Hughes-Phillips
Director
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their report and the financial statements for the year ended 31 December 2024.
Directors' responsibilities statement
|
The directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 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 period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements 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;
∙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 to 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 principal activity of the company is the provision of quantity surveying and expert witness services.
The profit for the year, after taxation, amounted to £163,192 (2023 - £813,927).
No dividends were declared or paid in the year (period ended 31 December 2023 - £Nil).
The directors who served during the year were:
N L Detchepare (resigned 14 October 2024)
|
|
|
|
|
|
|
M G T Marriott (appointed 14 October 2024)
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The company is continuing with its growth plans, with the focus on development of the expert witness team with recruitment, new clients, and new projects.
Disclosure of information to auditors
|
Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
Post balance sheet events
|
There have been no significant events affecting the Company since year end.
Under section 487(2) of the Companies Act 2006, BKL Audit LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
D P Hughes-Phillips
Director
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOCOTEC ADVISORY LIMITED
We have audited the financial statements of Socotec Advisory Limited (the 'Company') for the year ended 31 December 2024, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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.
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 United Kingdom, including the Financial Reporting Council'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.
|
|
SOCOTEC ADVISORY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOCOTEC ADVISORY LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
Opinion on other matters prescribed by the Companies Act 2006
|
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the 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.
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 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.
Responsibilities of directors
|
As explained more fully in the Directors' Responsibilities Statement set out on page 4, 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.
|
|
SOCOTEC ADVISORY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOCOTEC ADVISORY LIMITED (CONTINUED)
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 an Auditors' 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.
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:
∙Enquiring of management and those charged with governance around actual and potential litigation and
claims;
∙Enquiring of entity staff in finance and compliance functions to identify any instances of non-compliance with
laws and regulations
∙Reviewing minutes of meetings of those charged with governance;
∙Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
∙Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
∙Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
∙Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
∙Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
|
|
SOCOTEC ADVISORY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOCOTEC ADVISORY LIMITED (CONTINUED)
∙Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditors' Report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditors' Report. However, future events or conditions may cause the Company to cease to continue as a going concern.
∙Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
Nick Bishop FCA (Senior Statutory Auditor)
for and on behalf of
BKL Audit LLP
Chartered Accountants
Statutory Auditor
35 Ballards Lane
London
N3 1XW
5 December 2025
|
|
SOCOTEC ADVISORY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from fixed assets investments
|
|
|
|
Interest receivable and similar income
|
|
|
|
Interest payable and similar expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the financial year
|
|
|
|
There was no other comprehensive income for 2024 (2023:£NIL).
|
The notes on pages 14 to 29 form part of these financial statements.
|
|
|
SOCOTEC ADVISORY LIMITED
REGISTERED NUMBER: 08008548
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current asset investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Creditors: amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets less current liabilities
|
|
|
|
|
|
Provisions for liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
REGISTERED NUMBER: 08008548
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 14 to 29 form part of these financial statements.
|
|
SOCOTEC ADVISORY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income for the year
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the year
|
|
|
|
|
|
Contributions by and distributions to owners
|
|
|
|
|
|
Shares issued during the year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income for the year
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The notes on pages 14 to 29 form part of these financial statements.
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
The principal activity of the Company is the provision of quantity surveying and expert witness services.
The Company is a private company limited by shares and is incorporated in England and Wales.
The registered office address is 2nd Floor, Queens House, 55-56 Lincoln's Inn Fields, London, England, WC2A 3LJ.
2.Accounting policies
|
|
|
Basis of preparation of financial statements
|
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
|
|
|
Financial Reporting Standard 102 - reduced disclosure exemptions
|
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Socotec UK Limited as at 31 December 2024 and these financial statements may be obtained from the registered office.
|
|
|
Exemption from preparing consolidated financial statements
|
The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of any part of the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
The financial statements have been prepared on the going concern basis, which assumes that the Company will continue to be able to meet its liabilities as they fall due for a period of at least twelve months from the date of approval of these financial statements.
Based on the results to date and future projections, the directors are confident that the Company will continue to meet its liabilities as they fall due, looking forward at least twelve months from the date of signing these financial statements. The directors have a reasonable expectation that the Company has adequate resources to meet future working capital requirements and to continue in operation.
|
|
|
Foreign currency translation
|
Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
The Company generates revenue from the following services, and the revenue recognition policy for each is outlined as follows:
Revenue from the supply of quantity surveying services represents the value of services provided under contracts to the extent that there is a right to consideration and is recorded at the fair value of the consideration received or receivable. Where a contract has only been partially completed at the Statement of Financial Position date, turnover represents the fair value of the service provided to date based on the stage of completion of the contract activity as at that date. Where payments are received from customers in advance of services provided, the amounts are recorded as deferred income and included as part of creditors due within one year.
Expert witness projects fall into two categories. Revenue from time-based fee projects is recognised on a fair value basis in line with quantity surveying services. Revenue for event-based Expert Witness projects is recognised on the completion of the specific project.
The Company also acts a sub-contractor to a third party, and income for these projects is accrued on a fair value basis in line with quantity surveying services and is held as a debtor due within one year.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
|
|
|
Operating leases: the Company as lessee
|
Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term.
Interest income is recognised in profit or loss using the effective interest method.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
|
|
|
Current and deferred taxation
|
The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
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 in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.
Depreciation is provided on the following basis:
|
|
|
|
|
Short-term leasehold property
|
|
Over the life of the lease
|
|
|
|
|
|
|
|
|
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investments are in unlisted entities, which have been classified as fixed asset investments as the Company intends to hold them on a continuing basis. The investments are held at cost.
|
|
|
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.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
(i) Financial assets
Basic financial assets, including trade and other debtors, and amounts due from related companies, are initially recognised at transaction price, 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.
Such assets are subsequently carried at amortised cost using the effective interest method. At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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 the Statement of Comprehensive Income.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) control of the asset has been transferred to another party who has restrictions.
(ii) Financial liabilities
Basic financial liabilities, including trade and other creditors and accruals, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade creditors 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 liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
(iii) Offsetting
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
Judgements in applying accounting policies and key sources of estimation uncertainty
|
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the Statement of Financial Position date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. 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 following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements:
(i) Useful economic lives of tangible assets
The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are reassessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets. See note 13 for the carrying amount of the property plant and equipment, and note 2.11 for the useful economic lives for each class of assets.
(ii) Provision for bad debts
The Provision in respect of the trade debtors balance is subject to uncertainty. A full line-by-line review of trade debtors is carried out monthly. Whilst every attempt is made to ensure that the bad debt provision is as accurate as possible, there remains a risk that the provisions do not match the level of debts which ultimately provide to be collectable.
(iii) Accrued income
Due to the nature of the Company's trade, the accrued income balance may be outstanding for several months, during which period it is not known whether the full amount outstanding is likely to be received. Management have applied the prudence concept regarding clients who have historically requested discounts at a late stage in the commission. Management's assessment of the recoverability of these balances is therefore subject to a degree of uncertainty.
(iv) Advance payment discount accrual
The Company has accrued for discounts historically requested by clients at a late stage in the commission. Should the discount not be requested, the accrual is released to the Statement of Comprehensive Income in full at the time of receipt.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
|
|
|
An analysis of turnover by class of business is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Turnover from professional services
|
|
|
|
|
|
|
|
Analysis of turnover by country of destination:
|
|
|
|
|
The operating profit is stated after charging:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating lease rentals
|
|
|
|
|
|
|
|
|
|
|
|
|
During the year, the Company obtained the following services from the Company's auditors:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees payable to the Company's auditors for the audit of the Company's financial statements
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
|
|
|
Staff costs, including directors' remuneration, were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of defined contribution scheme
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The average monthly number of employees, including the directors, during the year was as follows:
|
|
|
During the year retirement benefits were accruing to 2 directors (2023 - 2) in respect of defined contribution pension schemes.
|
|
|
The highest paid director received remuneration of £160,052 (2023 - £198,987).
|
|
|
The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £6,000 (2023 - £6,000).
|
|
|
Dividends received from subsidiary
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
Interest receivable from group companies
|
|
|
|
|
|
|
|
|
|
Current tax on profits for the year
|
|
|
|
|
Adjustments in respect of previous periods
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origination and reversal of timing differences
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
11.Taxation (continued)
|
|
Factors affecting tax charge for the year
|
|
|
The tax assessed for the year is lower than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023 - 23.52%). The differences are explained below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit on ordinary activities before tax
|
|
|
|
|
Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 23.52%)
|
|
|
|
|
|
|
|
|
|
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
|
|
|
|
|
Capital allowances for year in excess of depreciation
|
|
|
|
|
|
|
|
|
|
Other differences leading to an increase (decrease) in the tax charge
|
|
|
|
|
Total tax charge for the year
|
|
|
|
|
Factors that may affect future tax charges
|
There were no factors that may affect future tax charges.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
Short-term leasehold property
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge for the year on owned assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in subsidiary companies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
|
|
|
The following was a subsidiary undertaking of the Company:
|
|
|
|
|
|
|
|
|
Base Quantum Ireland Limited
|
38 Upper Mount Street, Dublin 2, Dublin, Ireland
|
|
|
|
|
The aggregate of the share capital and reserves as at 31 December 2024 and the profit or loss for the year ended on that date for the subsidiary undertaking was as follows:
|
|
|
|
|
|
|
Base Quantum Ireland Limited
|
|
|
|
Due after more than one year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed by group undertakings
|
|
|
|
|
|
|
|
|
|
Prepayments and accrued income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed by group undertakings are unsecured, bear interest at base rate less 1%, and have no fixed terms of repayment.
|
|
|
Current asset investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
Creditors: Amounts falling due within one year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed to group undertakings
|
|
|
|
|
Other taxation and social security
|
|
|
|
|
|
|
|
|
|
Accruals and deferred income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts owed to group undertakings are unsecured, repayable on demand and carry no interest.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charged to profit or loss
|
|
|
|
|
|
|
|
|
The provision for deferred taxation is made up as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated capital allowances
|
|
|
|
|
Short term timing differences
|
|
|
|
|
|
|
|
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
|
Allotted, called up and fully paid
|
|
|
|
|
|
|
|
|
|
|
|
12,600 (2023 - 12,600) A Ordinary shares of £0.01 each
|
|
|
|
|
|
5,400 (2023 - 5,400) B Ordinary shares of £0.01 each
|
|
|
|
|
|
1,633 (2023 - 1,600) C Ordinary shares of £0.01 each
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A Ordinary shares hold the voting rights in the company.
B Ordinary shares hold rights to profit and capital pro rata to the holding of the A shareholders. They do note have voting rights.
C Oridnary shares have rights to capital distribution.
|
Other reserves
The other reserves represents the amount of the bonus share issue that was not distributable as dividends or part of retained earnings. The reserve was created on 16 December 2020.
Profit and loss account
The profit and loss account reserve represents the accumulated profits that have not been distributed to shareholders as dividends or transferred to other reserves.
The Company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and for the period amounted to £182,429 (2023: £175,685). Contributions totaling £Nil (2023: £30,918) were payable to the fund at the reporting date.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
|
|
Commitments under operating leases
|
|
|
At 31 December 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Later than 1 year and not later than 5 years
|
|
|
|
|
|
|
|
|
|
Related party transactions
|
|
|
Included in trade and other debtors is an amount of £108,981 (2023: £553,603) due from related parties.
Included in trade and other creditors is an amount of £186,224 (2023: £656,814) due to subsidiaries.
The company participates in a cash pooling arrangement with Socotec UK, under which £2,096,943 (2023: £952,000) has been pooled. Socotec UK earns interest on the pooled balance, of which Socotec Advisory receives a share; an amount of £60,178 (2023: £9,979) has been recognised within interest income in respect of this arrangement.
Included within sales is an amount of £766,443 (2023: £96,288) in respect of transactions with related companies.
Included within cost of sales is an amount of £363,565 (2023: £30,391) relating to transactions with related parties.
Included within wages is a recharged amount of £Nil (2023: £277,827) from a related company.
Included within administration expenses is an amount of £762,799 (2023: £564,864) recharged from related companies.
Included within wages and salaries in cost of sales is an amount of £369,471 (2023: £331,667) relating to directors’ salaries.
|
|
|
Post balance sheet events
|
There have been no significant events affecting the Company since year end.
|
|
SOCOTEC ADVISORY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
The immediate parent undertaking is Socotec UK Limited, a company registered in England and Wales.
The ultimate parent undertaking at 31 December 2024 was Soco 1 SAS, a Company incorporated in France, which owned 100% of Holding Socotec SAS, which as at 31 December 2024 held 98.68% of the issued share capital of Phoenix UK 2020 Limited, a company registered in England and Wales, which has been the ultimate domestic parent of this entity from 11 August 2020. Soco 1 SAS was the parent undertaking of the smallest and largest group to consolidate these financial statements and this company is included in the consolidated financial statements of Soco 1 SAS, a copy of which will be submitted alongside these financial statements and may be obtained from The Registrar of Companies, Companies Registration Office, Companies House, Crown Way, Maindy, Cardiff, CF14 3UZ. Since 25 April 2024, Polaris Socotec SAS became the ultimate parent undertaking as it acquired a majority shareholding in Soco 1 SAS.
In the opinion of the directors the ultimate controlling party is Sophinvest SA, a company registered in Luxembourg. Sophinvest SA, owns 63.76% of Soco 1 SAS the ultimate parent undertaking.
|