ACCOUNTS - Final Accounts

An analysis of turnover by class of business is as follows:

MARCOE ENGINEERING SERVICES LIMITED - Company Information

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Registered number: 03279838

MARCOE ENGINEERING SERVICES LIMITED

DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

MARCOE ENGINEERING SERVICES LIMITED

COMPANY INFORMATION

Directors	M S Crilley
	J A Reynolds (appointed 23 March 2021)


Registered number	03279838


Registered office	55 High Street
	Hoddesdon
	Hertfordshire
	EN11 8TQ


Independent auditors	WMT
	Chartered Accountants
	Verulam Point
	Station Way
	St Albans
	AL1 5HE

MARCOE ENGINEERING SERVICES LIMITED

CONTENTS

	Page
Directors' Report	1 - 2
Independent Auditors' Report	3 - 7
Consolidated Profit and Loss Account	8
Consolidated Statement of Comprehensive Income	9
Consolidated Balance Sheet	10 - 11
Company Balance Sheet	12
Consolidated Statement of Changes in Equity	13
Company Statement of Changes in Equity	14
Consolidated Statement of Cash Flows	15 - 16
Notes to the Financial Statements	17 - 33

MARCOE ENGINEERING SERVICES LIMITED

DIRECTORS' REPORT

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

The directors present their report and the financial statements for the period ended 30 September 2021.

Directors' responsibilities statement

The directors are responsible for preparing the Directors' Report and the consolidated 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 the Group and of the profit or loss of the Group for that period.

In preparing these financial statements, the directors are required to:

∙select suitable accounting policies for the Group's financial statements and then apply them consistently;

∙make judgments 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 Group 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 the Group 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Directors

The directors who served during the period were:

M S Crilley

J A Reynolds (appointed 23 March 2021)

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 and the Group'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 and the Group's auditors are aware of that information.

Auditors

The auditors, WMT, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Small companies note

In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

Page 1

MARCOE ENGINEERING SERVICES LIMITED

DIRECTORS' REPORT (CONTINUED)

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

This report was approved by the board and signed on its behalf.

M S Crilley

Director

Date: 7 September 2022

Page 2

MARCOE ENGINEERING SERVICES LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARCOE ENGINEERING SERVICES LIMITED

Opinion

We have audited the financial statements of Marcoe Engineering Services Limited (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 30 September 2021, which comprise the Group Profit and Loss Account, the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and Company 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 Group's and of the parent Company's affairs as at 30 September 2021 and of the Group's profit for the period 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 Group 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 Group's or the parent 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.

Page 3

MARCOE ENGINEERING SERVICES LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARCOE ENGINEERING SERVICES LIMITED (CONTINUED)

Other information

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 Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and

∙the Directors' Report has 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 Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in 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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or

∙the parent Company 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; 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' exemptions in preparing the Directors' Report and from the requirement to prepare a Group Strategic Report.

Page 4

MARCOE ENGINEERING SERVICES LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARCOE ENGINEERING SERVICES LIMITED (CONTINUED)

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement set out on page 1, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.

Page 5

MARCOE ENGINEERING SERVICES LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARCOE ENGINEERING SERVICES 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 Group 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:

Discussions with and enquiries of management and those charged with governance were held with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.
The following laws and regulations were identified as being of significance to the entity:
• Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law, Tax and Pensions legislation, and distributable profits legislation.
• Those laws and regulations for which non-compliance may be fundamental to the operating aspects of the business and therefore may have a material effect on the financial statements include health and safety legislation, employment law and data protection.
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; review of board minutes; testing the appropriateness of journal entries; and the performance of analytical review to identify unexpected movements in account balances which may be indicative of fraud.
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).

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 Auditors' Report.

Page 6

MARCOE ENGINEERING SERVICES LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF MARCOE ENGINEERING SERVICES LIMITED (CONTINUED)

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 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.

Graham Wintle (Senior Statutory Auditor)

for and on behalf of

WMT

Chartered Accountants

Verulam Point

Station Way

St Albans

AL1 5HE

7 September 2022

Page 7

MARCOE ENGINEERING SERVICES LIMITED

CONSOLIDATED PROFIT AND LOSS ACCOUNT

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

	2021	2020
Note	£	£


Turnover	6,278,801	-
Cost of sales	(5,334,230)	-
Gross profit	944,571	-
Administrative expenses	366,351	-
Other operating income	4,494	-
Operating profit	1,315,416	-
Interest payable and similar expenses	(4,494)	-
Profit before tax	1,310,922	-
Tax on profit	73,692	-
Profit for the financial period	1,384,614	-

Profit for the period attributable to:
Owners of the parent	1,384,614	-
	1,384,614	-

The notes on pages 17 to 33 form part of these financial statements.

Page 8

MARCOE ENGINEERING SERVICES LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

				2021	2020
			Note	£	£

Profit for the financial period	1,384,614	-
Other comprehensive income
Total comprehensive income for the period	1,384,614	-

Profit for the period attributable to:
Owners of the parent Company	1,384,614	-
	1,384,614	-

Total comprehensive income attributable to:
Owners of the parent Company	1,384,614	-
	1,384,614	-

The notes on pages 17 to 33 form part of these financial statements.

Page 9

MARCOE ENGINEERING SERVICES LIMITED

REGISTERED NUMBER: 03279838

CONSOLIDATED BALANCE SHEET

AS AT 30 SEPTEMBER 2021

	30 September	30 November
	2021	2020
Note	£	£

Fixed assets
Intangible assets			(145,030)		-
Tangible assets			13,609		-
			(131,421)		-
Current assets
Stocks		65,000		-
Debtors: amounts falling due after more than one year		440,444		-
Debtors: amounts falling due within one year		3,464,478		-
Cash at bank and in hand	15	1,147,176		3
		5,117,098		3
Creditors: amounts falling due within one year		(3,184,393)		-
Net current assets			1,932,705		3
Total assets less current liabilities			1,801,284		3
Creditors: amounts falling due after more than one year			(416,667)		-
Provisions for liabilities
Net assets excluding pension asset			1,384,617		3
Net assets			1,384,617		3

Capital and reserves
Called up share capital	3	3
Profit and loss account	1,384,614	-
Equity attributable to owners of the parent Company	1,384,617	3
	1,384,617	3

Page 10

MARCOE ENGINEERING SERVICES LIMITED

REGISTERED NUMBER: 03279838

CONSOLIDATED BALANCE SHEET (CONTINUED)

AS AT 30 SEPTEMBER 2021

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

The financial statements were approved and authorised for issue by the board and were signed on its behalf by:

M S Crilley

Director

Date: 7 September 2022

The notes on pages 17 to 33 form part of these financial statements.

Page 11

MARCOE ENGINEERING SERVICES LIMITED

REGISTERED NUMBER: 03279838

COMPANY BALANCE SHEET

AS AT 30 SEPTEMBER 2021

	30 September	30 November
	2021	2020
Note	£	£

Fixed assets
Investments	12		300,000		-
			300,000		-
Current assets
Cash at bank and in hand	15	500,003		3
		500,003		3
Creditors: amounts falling due within one year		(800,000)		-
Net current (liabilities)/assets			(299,997)		3
Total assets less current liabilities			3		3


Net assets excluding pension asset			3		3
Net assets			3		3

Capital and reserves
Called up share capital	3	3
	3	3

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

The financial statements were approved and authorised for issue by the board and were signed on its behalf by:

M S Crilley

Director

Date: 7 September 2022

The notes on pages 17 to 33 form part of these financial statements.

Page 12

MARCOE ENGINEERING SERVICES LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

	Called up share capital	Profit and loss account	Total equity
	£	£	£
At 1 December 2019	3	-	3
Other comprehensive income for the year	-	-	-
Total comprehensive income for the year	-	-	-
Total transactions with owners	-	-	-

At 1 December 2020	3	-	3
Comprehensive income for the period
Profit for the period	-	1,384,614	1,384,614
Other comprehensive income for the period	-	-	-
Total comprehensive income for the period	-	1,384,614	1,384,614
Total transactions with owners	-	-	-
At 30 September 2021	3	1,384,614	1,384,617

The notes on pages 17 to 33 form part of these financial statements.

Page 13

MARCOE ENGINEERING SERVICES LIMITED

COMPANY STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

	Called up share capital	Total equity
	£	£
At 1 December 2019	3	3
Other comprehensive income for the year	-	-
Total comprehensive income for the year	-	-
Total transactions with owners	-	-

At 1 December 2020	3	3
Other comprehensive income for the period	-	-
Total comprehensive income for the period	-	-
Total transactions with owners	-	-
At 30 September 2021	3	3

The notes on pages 17 to 33 form part of these financial statements.

Page 14

MARCOE ENGINEERING SERVICES LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

			30 September	30 November
			2021	2020
			£	£

Cash flows from operating activities
Profit for the financial period	1,384,614	-
Adjustments for:
Amortisation of intangible assets	(1,111,566)	-
Depreciation of tangible assets	5,536	-
Government grants	(4,494)	-
Interest paid	4,494	-
Taxation charge	(73,692)	-
(Increase)/decrease in stocks	(65,000)	-
(Increase)/decrease in debtors	(3,873,093)	-
Value of assets acquired	1,556,595	-
Increase in creditors	2,906,061	-
Corporation tax received	41,863	-
Net cash generated from operating activities	771,318	-

Cash flows from investing activities
Government grants received	4,494	-
Purchase of fixed asset investments	(124,145)	-
Net cash from investing activities	(119,651)	-
Cash flows from financing activities
New secured loans	500,000	-
Interest paid	(4,494)	-
Net cash used in financing activities	495,506	-
Net increase in cash and cash equivalents	1,147,173	-
Cash and cash equivalents at beginning of period	3	3
Cash and cash equivalents at the end of period	1,147,176	3

Cash and cash equivalents at the end of period comprise:
Cash at bank and in hand	1,147,176	3
	1,147,176	3

Page 15

MARCOE ENGINEERING SERVICES LIMITED

The notes on pages 17 to 33 form part of these financial statements.

Page 16

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

1.	General information

Marcoe Engineering Services Limited is a company limited by shares and incorporated in England & Wales under the Companies Act 2006. The address of the registered office is given on the Company information page. The nature of the Company's operations and its principal activities are set out in the Director's report.

2.Accounting policies

2.1

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 Group management to exercise judgment in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Profit and Loss Account in these financial statements.

The following principal accounting policies have been applied:

2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Profit and Loss Account from the date on which control is obtained on 26 March 2021. They are deconsolidated from the date control ceases.

Page 17

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

2.Accounting policies (continued)

2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group 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 following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

∙the Group has transferred the significant risks and rewards of ownership to the buyer;

∙the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

∙the amount of revenue can be measured reliably;

∙it is probable that the Group will receive the consideration due under the transaction; and

∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

∙the amount of revenue can be measured reliably;

∙it is probable that the Group will receive the consideration due under the contract;

∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and

∙the costs incurred and the costs to complete the contract can be measured reliably.

2.4

Operating leases: the Group 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, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

Page 18

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

2.Accounting policies (continued)

2.5

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated Profit and Loss Account in the same period as the related expenditure.

2.7

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

2.8

Borrowing costs

All borrowing costs are recognised in profit or loss in the period in which they are incurred.

2.9

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group 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 Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

Page 19

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

2.Accounting policies (continued)

2.10

Taxation

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 balance sheet date in the countries where the Company and the Group operate and generate income.

2.11

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

2.12

Tangible fixed assets

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:

Motor vehicles	-	25%	on reducing balance
Fixtures and fittings	-	25%	on reducing balance
Computer equipment	-	50%	on cost

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.

Page 20

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

2.Accounting policies (continued)

2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Group shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated Profit and Loss Account for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in profit or loss for the period.

2.14

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

2.15

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

2.16

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.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

2.17

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

2.18

Financial instruments

The Group 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.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that

Page 21

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

2.Accounting policies (continued)

2.18

Financial instruments (continued)

are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.

Investments in non-derivative instruments that are equity to the issuer are measured:

∙at fair value with changes recognised in the Consolidated Profit and Loss Account if the shares are publicly traded or their fair value can otherwise be measured reliably;

∙at cost less impairment for all other investments.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Profit and Loss Account.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were to be sold at the balance sheet date.

Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or income as appropriate. The company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.

3.	Judgments in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgments, estimates and
assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and
the amounts reported for revenues and expenses during the year. The nature of estimation means the
actual outcomes could differ from those estimates.

Page 22

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

Construction contracts	6,278,801	-
	6,278,801	-

All turnover arose within the United Kingdom.

5.	Other operating income
		2021	2020
		£	£

Government grants receivable	4,494	-
	4,494	-

6.	Auditors' remuneration
		2021	2020
		£	£

Fees payable to the Group's auditor and its associates for the audit of the Group's annual financial statements

6,310

Page 23

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

7.	Employees
		2021	2020
		£	£

Wages and salaries	950,762	-
Social security costs	106,160	-
Cost of defined contribution scheme	22,726	-
	1,079,648	-

The average monthly number of employees, including the directors, during the period was as follows:

	2021	2020
	No.	No.

Marcoe Engineering Ltd employees	45	-
Directors	5	2

	50	2

8.	Directors' remuneration

	During the period retirement benefits were accruing to 4 directors (2020 - 2) in respect of defined contribution pension schemes.
	The highest paid director received remuneration of £97,139 (2020 - £108,127).
	The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £1,318 (2020 - £NIL).

Page 24

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

Corporation tax
Current tax on profits for the year	41,905	-
Adjustments in respect of previous periods	(114,056)	-
	(72,151)	-

Total current tax	(72,151)	-

Deferred tax
Origination and reversal of timing differences	(1,541)	-
Total deferred tax	(1,541)	-


	Taxation on (loss)/profit on ordinary activities	(73,692)	-

Page 25

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

9.Taxation (continued)

Profit on ordinary activities before tax

1,310,922

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2020 - 19%)	249,075	-
Effects of:
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment	3,491	-
Adjustments to tax charge in respect of prior periods	367	-
Short-term timing difference leading to an increase (decrease) in taxation	(597)	-
Other differences leading to an increase (decrease) in the tax charge	(326,028)	-
Total tax charge for the period/year	(73,692)	-

Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 26

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

	Goodwill	Negative goodwill	Total
	£	£	£
Cost
At 1 December 2020	2,086,651	-	2,086,651
On acquisition of subsidiaries	-	(1,256,596)	(1,256,596)
At 30 September 2021	2,086,651	(1,256,596)	830,055
Amortisation
At 1 December 2020	2,086,651	-	2,086,651
Charge for the period on owned assets	-	(1,111,566)	(1,111,566)
At 30 September 2021	2,086,651	(1,111,566)	975,085
Net book value
At 30 September 2021	-	(145,030)	(145,030)
At 30 November 2020	-	-	-

The individual intangible assets which are material to the financial statements are negative goodwill arising on the acquisition of the subsidiary MSC Enterprises Limited in March 2021. This negative goodwill has been released in line with the use of the monetary financial assets that it relates to.

Page 27

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

11.	Tangible fixed assets
	Group

	Motor vehicles	Computer equipment	Total
	£	£	£
Cost or valuation
Acquisition of subsidiary	18,145	1,000	19,145
At 30 September 2021	18,145	1,000	19,145
Depreciation
Charge for the period on owned assets	4,536	1,000	5,536
At 30 September 2021	4,536	1,000	5,536
Net book value
At 30 September 2021	13,609	-	13,609
At 30 November 2020	-	-	-

Page 28

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

12.	Fixed asset investments

	Company

		Investments in subsidiary companies
		£
	Cost or valuation
	Additions	300,000
	At 30 September 2021	300,000

Subsidiary undertakings
The following were subsidiary undertakings of the Company:
Name	Registered office	Class of shares	Holding

	MSC Enterprises Limited	Unit 3 Mallow Park, AL7 1GX	Ordinary	100%
	Marcoe Engineering Ltd	Unit 3 Mallow Park, AL7 1GX	Orinary	100%

The aggregate of the share capital and reserves as at 30 September 2021 and the profit or loss for the period ended on that date for the subsidiary undertakings were as follows:
Name	Aggregate of share capital and reserves	Profit/(Loss)
	£	£

	MSC Enterprises Limited	935,693	-
	Marcoe Engineering Ltd	2,833,083	477,467

Page 29

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

13.	Stocks
		Group 30 September	Group 30 November
		2021	2020
		£	£

Finished goods and goods for resale	65,000	-
	65,000	-

The difference between purchase price or production cost of stocks and their replacement cost is not material.

14.	Debtors
		Group 30 September	Group 30 November	Company 30 September	Company 30 November
			2020		2020
		£	£	£	£

Due after more than one year
Trade debtors	440,444	-	-	-
	440,444	-	-	-

		Group 30 September	Group 30 November
		2021	2020
		£	£

Due within one year
Trade debtors	2,482,040	-
Other debtors	240,736	-
Prepayments and accrued income	509,975	-
Amounts recoverable on long-term contracts	231,727	-
	3,464,478	-

Page 30

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

15.	Cash and cash equivalents
		Group 30 September	Group 30 November	Company 30 September	Company 30 November
		2021	2020	2021	2020
		£	£	£	£

Cash at bank and in hand	1,147,176	3	500,003	3
	1,147,176	3	500,003	3

16.	Creditors: Amounts falling due within one year
		Group 30 September	Group 30 November	Company 30 September	Company 30 November
		2021	2020	2021	2020
		£	£	£	£

Bank loans	83,333	-	-	-
Trade creditors	2,647,730	-	-	-
Amounts owed to group undertakings	-	-	605,000	-
Other taxation and social security	64,331	-	-	-
Other creditors	231,907	-	195,000	-
Accruals and deferred income	157,092	-	-	-
	3,184,393	-	800,000	-

17.	Creditors: Amounts falling due after more than one year
		Group 30 September	Group 30 November
		2021	2020
		£	£

Bank loans	416,667	-
	416,667	-

There is security over the bank loan in the form of a debenture.

Page 31

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

18.	Loans
	Analysis of the maturity of loans is given below:
		Group 30 September	Group 30 November
		2021	2020
		£	£

Amounts falling due within one year
Bank loans	83,333	-
Amounts falling due 1-2 years
Bank loans	166,667	-
Amounts falling due 2-5 years
Bank loans	250,000	-

	500,000	-

19.	Financial instruments
		Group 30 September	Group 30 November	Company 30 September	Company 30 November
		2021	2020	2021	2020
		£	£	£	£

	Financial assets
	Financial assets measured at fair value through profit or loss	3,532,355	3	-	3

	Financial liabilities
	Financial liabilities measured at fair value through profit or loss	2,826,428	-	-	-

20.	Pension commitments

The Group operates a defined contributions pension scheme for all qualifying employees. The assets
of the scheme are held seperately from those of the company in an independently administered fund.
During the year there were contributions of £44,120 (2020: £40,151) to the pension scheme.
Contributions of £21,606 (2020: £11,373) were owed to the scheme at the balance sheet date.

Page 32

MARCOE ENGINEERING SERVICES LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 SEPTEMBER 2021

21.	Commitments under operating leases
	At 30 September 2021 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
		Group 30 September	Group 30 November
		2021	2020
		£	£

Not later than 1 year	123,178	-
Later than 1 year and not later than 5 years	471,200	-
Later than 5 years	589,000	-
	1,183,378	-

22.	Related party transactions
	During the year the Group entered into the following transactions with related parties:
				30 November
		Group 30 September 2021	Company 30 September 2021	2020
		£	£	£

	Entities under common control	81,150	-	-
		81,150	-	-

During the year £42,811 was paid in management charges to two of the directors.
The Group has taken advantage of the exception available under FRS 102 paragraph 33.1a whereby it
has not disclosed transactions between the ultimate parent company or any wholly owned subsidiary
undertaking of the group.
At the year end a subsidiary (MSC Enterprises Ltd) owed £1,041,369 to its subsidiary (Marcoe Engineering Ltd). In addition, in other creditors there is a loan from a director of £8,951. This loan is interest free and repayable on demand.

23.	Controlling party

The ultimate controlling party is Mark Crilley who owns 100% of the share capital.
During the year the ultimate controlling party changed from Mr Lee Compton of Cityside Electrical Co Limited to Mark Crilley due to the purchase of share capital in March 2021.

Page 33