Watermark Systems UK Limited

	Page
Balance Sheet	1—2
Notes to the Financial Statements	3—7

1. General Information

Watermark Systems UK Limited is a private company, limited by shares, incorporated in England & Wales, registered number 03004901 . The registered office is 10 St. Andrews Street, Droitwich, Worcestershire, WR9 8DY.

2. Accounting Policies

2.1. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention and in accordance with the FRS 102 Section 1A Small Entities - The Financial Reporting Standard applicable in the UK and Republic of Ireland and 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 £.

2.2. Turnover

Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services. Turnover is reduced for estimated customer returns, rebates and other similar allowances.

Sale of goods

Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods has transferred to the buyer. This is usually at the point that the customer has signed for the delivery of the goods.

2.3. Tangible Fixed Assets and Depreciation

Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is provided at rates calculated to write off the cost of the fixed assets, less their estimated residual value, over their expected useful lives on the following bases:

Plant & Machinery	15% p.a. reducing balance basis
Motor Vehicles	25% p.a. reducing balance basis
Fixtures & Fittings	15% p.a. reducing balance basis

2.4. Leasing and Hire Purchase Contracts

Assets obtained under finance leases are capitalised as tangible fixed assets. Assets acquired under finance leases are depreciated over the shorter of the lease term and their useful lives. Assets acquired under hire purchase contracts are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in the creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to the profit and loss account as incurred.

2.5. Stocks and Work in Progress

Stocks and work in progress are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow-moving stocks. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads. Work-in-progress is reflected in the accounts on a contract by contract basis by recording turnover and related costs as contract activity progresses.

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Watermark Systems UK Limited

Notes to the Financial Statements (continued)

For The Year Ended 30 April 2025

2.6. 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 Instruments

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.

Clasification of Financial Liabilities

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

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.

2.7. Foreign Currencies

Monetary assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate ruling on the date of the transaction. Exchange differences are taken into account in arriving at the operating profit.

2.8. Taxation

Income 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 profit as reported in the statement of comprehensive income because of items of income or expense that are taxable or deductible in other years and 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 end of the reporting period.

Deferred tax is recognised on timing differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable timing differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible timing differences can be utilised. The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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 assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. The measurement of deferred tax liabilities and assets reflect the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Current and deferred tax are recognised in profit or loss for the year, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case current and deferred tax are recognised in other comprehensive income or directly in equity respectively.

2.9. Pensions

The company operates a defined pension contribution scheme. Contributions are charged to the profit and loss account as they become payable in accordance with the rules of the scheme.

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Watermark Systems UK Limited

Notes to the Financial Statements (continued)

For The Year Ended 30 April 2025

2.10. Government Grant

Government grants are recognised in the profit and loss account in an appropriate manner that matches them with the expenditure towards which they are intended to contribute.

Grants for immediate financial support or to cover costs already incurred are recognised immediately in the profit and loss account. Grants towards general activities of the entity over a specific period are recognised in the profit and loss account over that period.

Grants towards fixed assets are recognised over the expected useful lives of the related assets and are treated as deferred income and released to the profit and loss account over the useful life of the asset concerned.

All grants in the profit and loss account are recognised when all conditions for receipt have been complied with.

3. Average Number of Employees

Average number of employees, including directors, during the year was: 21 (2024: 23)

4. Tangible Assets

	Plant & Machinery etc.
	£
Cost
As at 1 May 2024	365,112
Additions	72,785
Disposals	(47,640 )

As at 30 April 2025	390,257

Depreciation
As at 1 May 2024	275,263
Provided during the period	28,818
Disposals	(41,106 )

As at 30 April 2025	262,975

Net Book Value
As at 30 April 2025	127,282

As at 1 May 2024	89,849

5. Stocks

	2025	2024
	£	£
Materials	15,000	30,000
Work in progress	605,991	96,601

	620,991	126,601

6. Debtors

	2025	2024
	£	£
Due within one year
Trade debtors	1,170,553	355,544
Other debtors	16,485	6,323

	1,187,038	361,867

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Watermark Systems UK Limited

Notes to the Financial Statements (continued)

For The Year Ended 30 April 2025

7. Creditors: Amounts Falling Due Within One Year

	2025	2024
	£	£
Net obligations under finance lease and hire purchase contracts	14,899	-
Trade creditors	456,676	110,095
Bank loans and overdrafts	58,116	43,734
Other loans	60,185	60,185
Other creditors	587,409	17,292
Taxation and social security	68,553	28,537

	1,245,838	259,843

8. Creditors: Amounts Falling Due After More Than One Year

	2025	2024
	£	£
Net obligations under finance lease and hire purchase contracts	18,623	-
Bank loans	107,007	155,287
Other loans	60,185	120,370

	185,815	275,657

9. Secured Creditors

Of the creditors falling due within and after more than one year the following amounts are secured.

The bank loan is securred by the Government Recovery Loan Scheme and the loan in other creditors by a fixed and floating charge over the property and undertaking of the company.

The hire purchase debts are securred on the asset.

	2025	2024
	£	£
Net obligations under finance lease and hire purchase contracts	33,522	-
Bank loans and overdrafts	155,286	199,021
Other Creditors	120,370	180,555

10. Obligations Under Finance Leases and Hire Purchase

	2025	2024
	£	£
The future minimum finance lease payments are as follows:
Not later than one year	14,899	-
Later than one year and not later than five years	18,623	-

	33,522	-

	33,522	-

11. Share Capital

	2025	2024
	£	£
Allotted, Called up and fully paid	100	100

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Watermark Systems UK Limited

Notes to the Financial Statements (continued)

For The Year Ended 30 April 2025

12. Other Commitments

The total of future minimum lease payments under non-cancellable operating leases are as following:

	2025	2024
	£	£
Not later than one year	79,793	58,333
Later than one year and not later than five years	300,247	277,082

	380,040	335,415

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		2025		2024
	Notes	£	£	£	£
FIXED ASSETS
Tangible Assets	4		127,282		89,849

			127,282		89,849
CURRENT ASSETS
Stocks	5	620,991		126,601
Debtors	6	1,187,038		361,867
Cash at bank and in hand		146		195,442

		1,808,175		683,910
Creditors: Amounts Falling Due Within One Year	7	(1,245,838 )		(259,843 )

NET CURRENT ASSETS (LIABILITIES)			562,337		424,067

TOTAL ASSETS LESS CURRENT LIABILITIES			689,619		513,916

Creditors: Amounts Falling Due After More Than One Year	8		(185,815 )		(275,657 )

NET ASSETS			503,804		238,259

CAPITAL AND RESERVES
Called up share capital	11		100		100
Profit and Loss Account			503,704		238,159

SHAREHOLDERS' FUNDS			503,804		238,259