Conditioned Environment Mech Services - Limited company accounts 18.2

REGISTERED NUMBER: 03805885 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 31 March 2019

for

Conditioned Environment Mechanical

Services Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

12

Cash Flow Statement

13

Notes to the Cash Flow Statement

14

Notes to the Financial Statements

15

DIRECTORS:

Mr C J Pearce

Mr L Pearce

Mr A D Coulson

SECRETARY:

Mr L Pearce

REGISTERED OFFICE:

245 Acton Lane

Park Royal

London

NW10 7NR

REGISTERED NUMBER:

03805885 (England and Wales)

AUDITORS:

WP Audit Limited

Statutory Auditors

5a Frascati Way

Maidenhead

Berkshire

SL6 4UY

The directors present their strategic report for the year ended 31 March 2019.

REVIEW OF BUSINESS

The Directors consider the state of the company's results to be satisfactory. The Company is continuing to

consolidate the position of its brand in the market as well as continuing to monitor the market place

together with refining and updating its range of services. The directors are in the first year of a five-year

plan for improved services and a larger client base, that will see an uplift in sales and profitability.

Analysis of Key Performance Indicators

The Directors believe the KPI's of the company are turnover and profit before tax.

PRINCIPAL RISKS AND UNCERTAINTIES

The Company operates in a competitive market and market share fluctuations will always be a risk. The

company controls this risk by monitoring and continually refreshing its services. The company invests in

advertising and marketing campaigns together with a comprehensive training program for all staff.

ANALYSIS OF DEVELOPMENT AND PERFORMANCE

The Company continues to expand and grow in both sales and size. The Company remains debt free and

has continued to finance paid growth during this financial year and is forecast to return to profit within the

first quarter of the next financial year.

ON BEHALF OF THE BOARD:

Mr L Pearce - Director

10 March 2020

The directors present their report with the financial statements of the company for the year ended 31 March 2019.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of mechanical services and building

refurbishment.

DIVIDENDS

An interim dividend of 2,763.0277 per share on the Ordinary shares £0.01 shares was paid on 11 September 2018. The directors recommend that no final dividend be paid on these shares.

No interim dividend was paid on the Ordinary A £0.01 shares. The directors recommend that no final

dividend be paid on these shares.

The total distribution of dividends for the year ended 31 March 2019 will be £ 614,000 .

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2018 to the date of

this report.

Mr C J Pearce

Mr L Pearce

Other changes in directors holding office are as follows:

Mr A D Coulson - appointed 1 June 2018

POLITICAL DONATIONS AND EXPENDITURE

During the year, the company made charitable donations of £8,506 (2018: £9,480) to a variety of charities.

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, WP Audit Limited, will be proposed for re-appointment at the forthcoming Annual General

Meeting.

ON BEHALF OF THE BOARD:

Mr L Pearce - Director

10 March 2020

Opinion

We have audited the financial statements of Conditioned Environment Mechanical Services Limited (the

'company') for the year ended 31 March 2019 which comprise the Income Statement, Other

Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to

the Cash Flow Statement, 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). This is the first financial year that the company has been subject to audit.

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 March 2019 and of its loss for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and

applicable law. Our responsibilities under those standards are further described in the 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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us

to report to you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

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 there is a material misstatement in the financial statements or a material misstatement of the

other information. 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 pages three and 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.

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.

Philippa Duckworth BSc FCCA (Senior Statutory Auditor)

for and on behalf of WP Audit Limited

Statutory Auditors

5a Frascati Way

Maidenhead

Berkshire

SL6 4UY

10 March 2020

TURNOVER

3

16,001,468

13,554,980

Cost of sales

(14,156,300

)

(11,080,364

)

GROSS PROFIT

1,845,168

2,474,616

Administrative expenses

(2,279,158

)

(1,819,126

)

OPERATING (LOSS)/PROFIT

5

(433,990

)

655,490

Interest receivable and similar income

1,955

15

(432,035

)

655,505

Interest payable and similar expenses

6

(31,784

)

(7,657

)

(LOSS)/PROFIT BEFORE TAXATION

(463,819

)

647,848

Tax on (loss)/profit

7

427,876

(161,285

)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(35,943

)

486,563

(LOSS)/PROFIT FOR THE YEAR

(35,943

)

486,563

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(35,943

)

486,563

FIXED ASSETS

Tangible assets

9

74,658

117,388

CURRENT ASSETS

Stocks

10

514,806

187,834

Debtors

11

3,316,612

4,668,056

Cash at bank and in hand

96,688

122,426

3,928,106

4,978,316

CREDITORS

Amounts falling due within one year

12

(3,981,275

)

(4,395,760

)

NET CURRENT (LIABILITIES)/ASSETS

(53,169

)

582,556

TOTAL ASSETS LESS CURRENT LIABILITIES

21,489

699,944

CREDITORS

Amounts falling due after more than one year

13

(13,044

)

(35,264

)

PROVISIONS FOR LIABILITIES

16

(3,240

)

(9,554

)

NET ASSETS

5,205

655,126

CAPITAL AND RESERVES

Called up share capital

17

222

200

Retained earnings

18

4,983

654,926

SHAREHOLDERS' FUNDS

5,205

655,126

The financial statements were approved by the Board of Directors on 10 March 2020 and were signed on its behalf by:

Mr L Pearce - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 April 2017

200

378,363

378,563

Changes in equity

Dividends

-

(210,000

)

(210,000

)

Total comprehensive income

-

486,563

486,563

Balance at 31 March 2018

200

654,926

655,126

Changes in equity

Issue of share capital

22

-

22

Dividends

-

(614,000

)

(614,000

)

Total comprehensive income

-

(35,943

)

(35,943

)

Balance at 31 March 2019

222

4,983

5,205

Cash flows from operating activities

Cash generated from operations

1

1,132,310

453,812

Interest paid

(25,128

)

(3,422

)

Interest element of hire purchase payments paid

(6,655

)

(4,235

)

Tax paid

(166,794

)

(139,834

)

Net cash from operating activities

933,733

306,321

Cash flows from investing activities

Purchase of tangible fixed assets

(9,094

)

(22,908

)

Interest received

1,955

15

Net cash from investing activities

(7,139

)

(22,893

)

Cash flows from financing activities

Loan repayments in year

-

(15,739

)

Capital repayments in year

(28,234

)

(21,185

)

Amount introduced by directors

614,000

210,001

Amount withdrawn by directors

(924,120

)

(464,956

)

Share issue

22

-

Equity dividends paid

(614,000

)

(210,000

)

Net cash from financing activities

(952,332

)

(501,879

)

Decrease in cash and cash equivalents

(25,738

)

(218,451

)

Cash and cash equivalents at beginning of year

2

122,426

340,877

Cash and cash equivalents at end of year

2

96,688

122,426

1.	RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

31.3.19

31.3.18

£

£

(Loss)/profit before taxation

(463,819

)

647,848

Depreciation charges

51,823

64,175

Finance costs

31,784

7,657

Finance income

(1,955

)

(15

)

(382,167

)

719,665

Increase in stocks

(326,972

)

(1,782

)

Decrease/(increase) in trade and other debtors

2,083,125

(1,706,355

)

(Decrease)/increase in trade and other creditors

(241,676

)

1,442,284

Cash generated from operations

1,132,310

453,812

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in

respect of these Balance Sheet amounts:

Year ended 31 March 2019

31.3.19

1.4.18

£

£

Cash and cash equivalents

96,688

122,426

Year ended 31 March 2018

31.3.18

1.4.17

£

£

Cash and cash equivalents

122,426

340,877

1.	STATUTORY INFORMATION

Conditioned Environment Mechanical Services 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.

The accounts are prepared on a going concern basis as in the opinion of the directors the company

has sufficient finance available to it to meet its obligations as they fall due for the foreseeable

future, that is at least 12 months from the date of approval of the accounts.

Significant judgements and estimates

In the application of the company's accounting policies the directors are required to make

judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are

not readily apparent from other sources. The estimates and associated assumptions are based on

historical experience and other factors that are considered to be relevant. Actual results may differ

from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to

accounting estimates are recognised in the period in which the estimate is revised if the revision

affects only that period, or in the period of the revision and future periods if the revision affects

both current and future periods.

At the year end the company estimates the stage of completion for on going projects. At the start of

a project a margin is forecast; an adjustment is made to the costs through accruals or prepayments

to maintain this margin. All loss making contracts are provided for in full.

Turnover

Turnover represents the value of goods and services under contracts, provided in the period,

exclusive of Value Added Tax, to the extent that there is a right to consideration and is recorded at

the value of consideration due.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Plant and machinery

-

25% on cost

Fixtures and fittings

-

20% on cost

Motor vehicles

-

33% on cost and 20% on cost

Computer equipment

-

33% on cost

Tangible fixed assets are included at cost less depreciation and impairment.

Stocks

Stock and work in progress is valued using the retail price of items (sales price rather than

trade/cost), after making due allowance for obsolete and slow moving items.

Financial instruments

Financial assets and financial liabilities are recognised when the company becomes a party to the

contractual provisions of the instrument. Financial liabilities and equity instruments are classified

according to the substance of the contractual arrangements entered into. An equity instrument is

any contract that evidences a residual interest in the assets of the company after deducting all of its

liabilities.

(i) Financial assets and liabilities

All financial assets and liabilities are initially measured at transaction price (including transaction

costs), except for those financial assets classified as at fair value through profit or loss, which are

initially measured at fair value (which is normally the transaction price excluding transaction costs),

unless the arrangement constitutes a financing transaction. If an arrangement constitutes a

financing transaction, the financial asset or financial liability is measured at the present value of the

future payments discounted at a market rate of interest for a similar debt instrument. Financial

assets and liabilities are only offset in the statement of financial position when, and only when there

exists a legally enforceable right to set off the recognised amounts and the company intends either

to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Debt instruments which meet the following conditions are subsequently measured at amortised cost

using the effective interest method:

(a) The contractual return to the holder is (i) a fixed amount; (ii) a positive fixed rate or a positive

variable rate; or (iii) a combination of a positive or a negative fixed rate and a positive variable rate.

(b) The contract may provide for repayments of the principal or the return to the holder (but not

both) to be linked to a single relevant observable index of general price inflation of the currency in

which the debt instrument is denominated, provided such links are not leveraged.

(c) The contract may provide for a determinable variation of the return to the holder during the life

of the instrument, provided that (i) the new rate satisfies condition (a) and the variation is not

contingent on future events other than (1) a change of a contractual variable rate; (2) to protect the

holder against credit deterioration of the issuer; (3) changes in levies applied by a central bank or

arising from changes in relevant taxation or law; or (ii) the new rate is a market rate of interest and

satisfies condition (a).

(d) There is no contractual provision that could, by its terms, result in the holder losing the principal

amount or any interest attributable to the current period or prior periods.

(e) Contractual provisions that permit the issuer to prepay a debt instrument or permit the holder

to put it back to the issuer before maturity are not contingent on future events, other than to

protect the holder against the credit deterioration of the issuer or a change in control of the issuer,

or to protect the holder or issuer against changes in levies applied by a central bank or arising from

changes in relevant taxation or law.

(f) Contractual provisions may permit the extension of the term of the debt instrument, provided

that the return to the holder and any other contractual provisions applicable during the extended

term satisfy the conditions of paragraphs (a) to (c).

Debt instruments that are classified as payable or receivable within one year on initial recognition

and which meet the above conditions are measured at the undiscounted amount of the cash or

other consideration expected to be paid or received, net of impairment. With the exception of some

hedging instruments, other debt instruments not meeting these conditions are measured at fair

value through profit or loss. Commitments to make and receive loans which meet the conditions

mentioned above are measured at cost (which may be nil) less impairment.

Financial assets are derecognised when and only when (a) the contractual rights to the cash flows

from the financial asset expire or are settled, (b) the company transfers to another party

substantially all of the risks and rewards of ownership of the financial asset, or (c) the company,

despite having retained some, but not all, significant risks and rewards of ownership, has transferred

control of the asset to another party. Financial liabilities are derecognised only when the obligation

specified in the contract is discharged, cancelled or expires.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income

Statement, 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 balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed

at the balance sheet 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.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet.

Those held under hire purchase contracts are depreciated over their estimated useful lives. Those

held under finance leases are depreciated over their estimated useful lives or the lease term,

whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The

capital element of the future payments is treated as a liability.

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.

3.

TURNOVER

The turnover and loss (2018 - profit) before taxation are attributable to the one principal activity of

the company.

An analysis of turnover by geographical market is given below:

31.3.19

31.3.18

£

£

United Kingdom

16,001,468

13,554,980

16,001,468

13,554,980

4.	EMPLOYEES AND DIRECTORS

31.3.19

31.3.18

£

£

Wages and salaries

3,790,742

2,421,978

Social security costs

424,988

272,647

Other pension costs

40,257

11,341

4,255,987

2,705,966