Walsingham Motor Insurance Limited - Limited company accounts 20.1

REGISTERED NUMBER: 08164227 (England and Wales)

Report of the Directors and

Financial Statements for the Year Ended 30 September 2020

for

Walsingham Motor Insurance Limited

Page

Company Information

1

Report of the Directors

2

Report of the Independent Auditor

4

Income Statement

6

Balance Sheet

7

Notes to the Financial Statements

8

DIRECTORS:

G C Watson

S L Crabb

M B Gray

J S Newman

REGISTERED OFFICE:

132a Bournemouth Road

Chandler's Ford

Eastleigh

Hampshire

SO53 3AL

REGISTERED NUMBER:

08164227 (England and Wales)

AUDITOR:

Michael Alan Northover TD FCA

Senior Statutory Auditor

132A Bournemouth Road

Chandlers Ford

Eastleigh

Hampshire

SO53 3AL

The directors present their report with the financial statements of the company for the year ended 30 September 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of a specialist UK Motor Managing General Agency.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 October 2019 to the date of this report.

G C Watson

S L Crabb

M B Gray

J S Newman

IMPACT OF COVID-19

In accordance with the Government's order for Lockdown and advice to avoid continued office based work, our entire team moved to home based working, this process being achieved very smoothly and successfully. To date, no members of staff have been furloughed and they all continue in full time employment. During Lockdown, premiums were initially impacted as taxi fleets cancelled or reduced their fleet sizes. However due to the flexible approach in allowing taxi drivers to carry food and allow NHS support work, as Lockdown eased premiums returned to their pre-Lockdown levels, such that the Directors are currently expecting the business to achieve its original budget for the year ended 30 September 2021. Due to the continued successful trading, the business was able to repay its initial loan funding early by 22 July 2020. The current Balance Sheet shows a very healthy surplus of net working capital with liquidity at an all time high and for these reasons the directors are of the opinion that there has been no compromise of Going Concern for the foreseeable future.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing 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 auditor is 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 auditor is aware of that information.

This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small companies.

ON BEHALF OF THE BOARD:

G C Watson - Director

25 June 2021

Opinion

I have audited the financial statements of Walsingham Motor Insurance Limited (the 'company') for the year ended 30 September 2020 which comprise the Income Statement, Balance Sheet and 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 my opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 30 September 2020 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.

Basis for opinion

I conducted my audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. My responsibilities under those standards are further described in the Auditor responsibilities for the audit of the financial statements section of my report. I am independent of the company in accordance with the ethical requirements that are relevant to my audit of the financial statements in the UK, including the FRC's Ethical Standard, and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Conclusions relating to going concern

I have nothing to report in respect of the following matters in relation to which the ISAs (UK) require me 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.

Emphasis of matter - Covid-19 Pandemic

I would however draw your attention to the note in the Report of the Directors concerning the post financial period effects of the Covid-19 Pandemic and the Going Concern note in Accounting Policies and can confirm that, having had sight of the latest Management Accounts that references to the latest trading results and liquidity, they are factually correct and that their opinion as to the likely full 2021 financial period results appears to be soundly based.

Other information

The directors are responsible for the other information. The other information comprises the information in the Report of the Directors, but does not include the financial statements and my Report of the Auditor thereon.

My opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in my report, I do not express any form of assurance conclusion thereon.

In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in the audit or otherwise appears to be materially misstated. If I identify such material inconsistencies or apparent material misstatements, I am 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 I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

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

-	the Report of the Directors has been prepared in accordance with applicable legal requirements.

Matters on which I am 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, I have not identified material misstatements in the Report of the Directors.

I have nothing to report in respect of the following matters where the Companies Act 2006 requires me to report to you if, in my opinion:

-	adequate accounting records have not been kept, or returns adequate for my audit have not been received from branches not visited by me; 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

-	I have not received all the information and explanations I require for my audit; or

-	the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption from the requirement to prepare a Strategic Report or in preparing the Report of the Directors.

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

My 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 Auditor that includes my 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 my 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 my Report of the Auditor.

Use of my 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. My audit work has been undertaken so that I might state to the company's members those matters I am required to state to them in a Report of the Auditor and for no other purpose. To the fullest extent permitted by law, I do not accept or assume responsibility to anyone other than the company and the company's members as a body, for my audit work, for this report, or for the opinions I have formed.

Michael Alan Northover TD FCA

Senior Statutory Auditor

132A Bournemouth Road

Chandlers Ford

Eastleigh

Hampshire

SO53 3AL

25 June 2021

REVENUE

3,302,787

3,304,542

Costs of commissions received

914,838

918,625

GROSS PROFIT

2,387,949

2,385,917

Administrative expenses

1,460,807

1,544,011

927,142

841,906

Other operating income

35,681

13,534

OPERATING PROFIT and

PROFIT BEFORE TAXATION

962,823

855,440

Tax on profit

5

185,074

165,146

PROFIT FOR THE FINANCIAL YEAR

777,749

690,294

FIXED ASSETS

Property, plant and equipment

6

5,977

6,070

CURRENT ASSETS

Debtors

7

461,629

767,116

Cash at bank

1,230,573

698,337

1,692,202

1,465,453

CREDITORS

Amounts falling due within one year

8

1,144,163

1,520,256

NET CURRENT ASSETS/(LIABILITIES)

548,039

(54,803

)

TOTAL ASSETS LESS CURRENT LIABILITIES

554,016

(48,733

)

CREDITORS

Amounts falling due after more than one year

9

-

175,000

NET ASSETS/(LIABILITIES)

554,016

(223,733

)

CAPITAL AND RESERVES

Called up share capital

12

1,432

1,432

Share premium

13

599,568

599,568

Retained earnings

13

(46,984

)

(824,733

)

SHAREHOLDERS' FUNDS

554,016

(223,733

)

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 25 June 2021 and were signed on its behalf by:

M B Gray - Director

G C Watson - Director

1.	STATUTORY INFORMATION

Walsingham Motor Insurance 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.

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" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

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 amount of liabilities that are not apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.

The most significant estimates included concern the following:

Commissions: By agreement the Company's rate of commission is subject to an overall maximum rate on Gross Written Premiums (GWP) per underwriting year. As the actual rate may fluctuate throughout the year, an appropriate provision has been made to ensure that overall commission accounted for is within the maximum rate permitted.

Claims handling costs: Accruals for claims handling costs are calculated based upon Gross Written Premiums (GWP) for the year. This estimate and calculation is reviewed on an ongoing basis and is accrued monthly for management accounts purposes and is an estimate of the current cost of handling claims on business written to extinction. This provision is monitored against actual claims incurred during the year.

As at 30 September 2020 the provision for future claims handling costs was calculated at £525,543

(2019 £447,434).

Revenue

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 and receivable, excluding discounts and cancellations.

The following criteria must also be met before revenue is recognised:

Revenue consists principally of commissions associated with the placement of insurance contracts, net of commissions payable to other directly involved parties. Revenue from commissions are recognised on the inception date of the risk. Any adjustments to commission arising from premium additions or returns or cancellation are recognised as and when they are notified by third parties.

Tangible fixed assets

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

Computer equipment

-

20% on cost

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.

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.

Going concern

The company has made a significant profit for the year and continues to operate an effective infrastructure as a specialist UK Motor Managing General Agency (MGA) despite six months of the financial year being affected by the Covid-19 Pandemic. Despite Lockdowns the business has continued to trade successfully. Management accounts to date show continued strong profitability for the financial year to 30 September 2021. The significant profits for the financial year has enabled the company to repay all long term lending. The Directors are therefore satisfied that these accounts have been properly prepared on the going concern basis.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 13 (2019 - 13 ) .

2020

2019

£

£

Directors' remuneration

298,230

350,939

Directors' pension contributions to money purchase schemes

14,684

12,460

Information regarding the highest paid director is as follows:

2020

2019

£

£

Emoluments etc

194,730

216,780

Pension contributions to money purchase schemes

7,342

6,230

4.	OPERATING PROFIT

The operating profit is stated after charging:

2020

2019

£

£

Depreciation - owned assets

2,037

1,316

5.

TAXATION

Analysis of the tax charge

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

2020

2019

£

£

Current tax:

UK corporation tax

1,144

-

Deferred tax assets

183,930

165,146

Tax on profit

185,074

165,146

UK corporation tax has been charged at 19% .

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:

2020

2019

£

£

Profit before tax

962,823

855,440

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2019 - 19%)

182,936

162,534

Effects of:

Expenses not deductible for tax purposes

2,160

3,395

Capital allowances in excess of depreciation

(22

)

(783

)

Total tax charge

185,074

165,146

6.	PROPERTY, PLANT AND EQUIPMENT

Computer

equipment

£

COST

At 1 October 2019

8,896

Additions

1,944

At 30 September 2020

10,840

DEPRECIATION

At 1 October 2019

2,826

Charge for year

2,037

At 30 September 2020

4,863

NET BOOK VALUE

At 30 September 2020

5,977

At 30 September 2019

6,070

7.

DEBTORS

2020

2019

£

£

Amounts falling due within one year:

Trade debtors

396,860

534,039

Other debtors

12,051

11,676

Prepayments

52,718

37,471

461,629

583,186

Amounts falling due after more than one year:

Deferred tax asset

-

183,930

Aggregate amounts

461,629

767,116

8.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Other loans (see note 10)

-

595,000

Trade creditors

970,043

618,992

Tax

49,305

58,153

Other creditors

94,360

206,499

Accrued expenses

30,455

41,612

1,144,163

1,520,256

9.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2020

2019

£

£

Other loans (see note 10)

-

175,000

10.

LOANS

An analysis of the maturity of loans is given below:

2020

2019

£

£

Amounts falling due within one year or on demand:

Other loans

-

595,000

Amounts falling due between one and two years:

Other loans - 1-2 years

-

175,000

11.	SECURED DEBTS

The following secured debts are included within creditors:

2020

2019

£

£

B P Marsh & Co Ltd

-

770,000

Fixed and floating charge

12.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2020

2019

value:

£

£

850

Ordinary shares

1

850

850

579

Preferred 'A' Ordinary shares

1

579

579

3

Preferred 'B' Ordinary shares

1

3

3

1,432

1,432

13.

RESERVES

Retained

Share

earnings

premium

Totals

£

£

£

At 1 October 2019

(824,733

)

599,568

(225,165

)

Profit for the year

777,749

777,749

At 30 September 2020

(46,984

)

599,568

552,584

14.	DIRECTORS' ADVANCES, CREDITS AND GUARANTEES

The following advances and credits to a director subsisted during the years ended 30 September 2020 and 30 September 2019:

2020

2019

£

£

G C Watson

Balance outstanding at start of year

10,000

10,000

Amounts advanced

-

20,000

Amounts repaid

-

(20,000

)

Amounts written off

-

-

Amounts waived

-

-

Balance outstanding at end of year

10,000

10,000

15.	RELATED PARTY DISCLOSURES

B P Marsh & Company Ltd

A shareholder.

During the year this Company charged Loan Interest and Finance charges of £31,866 (2019: £85,518) on outstanding Loans and £45,600 (2019: £45,600) of Non Executive Director's Fees for the services of Mr J Newman who is a Director of both Companies.

Mr S Crabb

Director

Mr S Crabb is a director of Ambant Underwriting Services Ltd, a company that acts as Regulator to Walsingham Motor Insurance Ltd for the Financial Conduct Authority and which charged Fees during the financial year of £133,631 (2019: £91,515) for compliance and financial services.

Mr S Pemberton

Shareholder

Mr S Pemberton is a director of Gallacher Bassett International Ltd which charged the Company £555,047 (2019: £615,254) during the year for Claims Handling management services.

Walsingham Holdings Limited

The shareholders of this Company are Mr M Gray, Mr G Watson, Mr B Hollywood, Mr S Twidell and B P Marsh & Company Limited. During the year £24,600 (2019: £25,393) was paid to this Company for Management Services.

16.	ULTIMATE CONTROLLING PARTY

The directors consider that there is no ultimate controlling party.