Circuit Group Limited - Limited company accounts 20.1

REGISTERED NUMBER: 06092031 (England and Wales)

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2021

FOR

CIRCUIT GROUP LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Notes to the Consolidated Financial Statements

15

DIRECTORS:

C S Hill

D J Brown

A Hiron

SECRETARY:

C S Hill

REGISTERED OFFICE:

28 Aston Road

Waterlooville

Hampshire

PO7 7XJ

REGISTERED NUMBER:

06092031 (England and Wales)

AUDITORS:

Watson Associates (Audit Services) Ltd

30 - 34 North Street

Hailsham

East Sussex

BN27 1DW

The directors present their strategic report of the company and the group for the year ended 31 December 2021.

BUSINESS REVIEW AND RISKS

Although anticipated, the company did not see a reduction in operations as a result of the global COVID-19 pandemic. The company operates within the construction sector and the demand for its products has increased as a result of the current situation.

This continues to be an unprecedented situation but unlike the wider economy it has not caused a significant amount of uncertainty for the company.

The Directors have nevertheless considered the potential implications of COVID-19 and have taken the following actions to mitigate the principle risks and uncertainties . All measures taken by the company have taken into account the effect of the extent and duration of social distancing measures announced by the government in March 2020, as well as the impact on the economy and asset prices generally:

Utilised the government's job retention scheme

Deferral of VAT and PAYE payments in accordance with government guidelines

Further measures are reviewed on an ongoing basis.

The liquidity of the company remains healthy due to the significant cash balance which is readily accessible. The company has a good order pipeline and continues to be in a strong position to maintain market share, contracts with key customers and market share.

ON BEHALF OF THE BOARD:

C S Hill - Director

24 September 2022

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2021.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2021 to the date of this report.

C S Hill

D J Brown

A Hiron

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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 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 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group'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 group's auditors are aware of that information.

AUDITORS

The auditors, Watson Associates (Audit Services) Ltd, will be proposed for re-appointment at the forthcoming Annual General Meeting.

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:

C S Hill - Director

24 September 2022

Opinion

We have audited the financial statements of Circuit Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2021 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity 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 our opinion the financial statements:

-	give a true and fair view of the state of the group's and of the parent company affairs as at 31 December 2021 and of the group's 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

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 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

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 and 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.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group 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 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.

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 Group 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 Group 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 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' exemption from the requirement to prepare a Group 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 three, 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 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.

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.

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.

Audit procedures performed by the engagement team to detect irregularities, including fraud from instances of non-compliance with laws and regulations included:

- Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud;

- Reading key correspondence from regulatory bodies;

- Challenging assumptions and judgements made by management in it's significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. We focused on the valuation of the stock provision based on the dead stock report and the provision for bad debts was discussed with the managing director.

- Consideration of recent correspondence with the companies legal advisors to ensure that it aligned with the conclusions drawn on obligations recognised in respect of uncertain legal matters;

- Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations or those posted by unexpected users; and

- Testing all material consolidation adjustments to ensure these were appropriate in nature and magnitude.

- Reviewing relevant meeting minutes including those of the board of directors

- Testing transactions entered into that are outside of the normal course of the Company's business

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, through discussion with the directors and other management (as required by auditing standards), and from inspection of the group's regulatory and legal correspondence.. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.

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.

Stephen James Moore (FCCA) (Senior Statutory Auditor)

for and on behalf of Watson Associates (Audit Services) Ltd

30 - 34 North Street

Hailsham

East Sussex

BN27 1DW

24 September 2022

TURNOVER

5,572,313

5,195,391

Cost of sales

(4,319,583

)

(3,897,495

)

GROSS PROFIT

1,252,730

1,297,896

Administrative expenses

(1,015,657

)

(1,101,272

)

237,073

196,624

Other operating income

53,380

161,306

OPERATING PROFIT

4

290,453

357,930

Income from shares in group undertakings

-

(1

)

Income from fixed asset investments

(7,405

)

(15,312

)

PROFIT BEFORE TAXATION

283,048

342,617

Tax on profit

5

(57,579

)

(68,772

)

PROFIT FOR THE FINANCIAL YEAR

225,469

273,845

Profit attributable to:

Owners of the parent

225,469

273,845

PROFIT FOR THE YEAR

225,469

273,845

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

225,469

273,845

Total comprehensive income attributable to:

Owners of the parent

225,469

273,845

FIXED ASSETS

Tangible assets

8

735,136

37,925

Investments

9

55,000

55,000

790,136

92,925

CURRENT ASSETS

Stocks

418,679

365,320

Debtors

10

1,044,532

1,155,921

Cash at bank and in hand

373,222

642,411

1,836,433

2,163,652

CREDITORS

Amounts falling due within one year

11

(1,514,456

)

(1,174,528

)

NET CURRENT ASSETS

321,977

989,124

TOTAL ASSETS LESS CURRENT LIABILITIES

1,112,113

1,082,049

PROVISIONS FOR LIABILITIES

(13,372

)

(6,824

)

NET ASSETS

1,098,741

1,075,225

CAPITAL AND RESERVES

Called up share capital

12

32,020

31,354

Share premium

19,200

12,806

Retained earnings

1,047,521

1,031,065

SHAREHOLDERS' FUNDS

1,098,741

1,075,225

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 24 September 2022 and were signed on its behalf by:

C S Hill - Director

FIXED ASSETS

Tangible assets

8

-

-

Investments

9

30,000

30,000

30,000

30,000

CURRENT ASSETS

Debtors

10

143,178

144,171

CREDITORS

Amounts falling due within one year

11

(6,840

)

(7,834

)

NET CURRENT ASSETS

136,338

136,337

TOTAL ASSETS LESS CURRENT LIABILITIES

166,338

166,337

CAPITAL AND RESERVES

Called up share capital

12

32,020

31,354

Share premium

19,200

12,806

Retained earnings

115,118

122,177

SHAREHOLDERS' FUNDS

166,338

166,337

Company's profit for the financial year

201,954

275,662

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 24 September 2022 and were signed on its behalf by:

C S Hill - Director

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Balance at 1 January 2020

30,686

1,033,696

6,394

1,070,776

Changes in equity

Issue of share capital

668

-

6,412

7,080

Dividends

-

(276,476

)

-

(276,476

)

Total comprehensive income

-

273,845

-

273,845

Balance at 31 December 2020

31,354

1,031,065

12,806

1,075,225

Changes in equity

Issue of share capital

666

-

6,394

7,060

Dividends

-

(209,013

)

-

(209,013

)

Total comprehensive income

-

225,469

-

225,469

Balance at 31 December 2021

32,020

1,047,521

19,200

1,098,741

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Balance at 1 January 2020

30,686

122,991

6,394

160,071

Changes in equity

Issue of share capital

668

-

6,412

7,080

Dividends

-

(276,476

)

-

(276,476

)

Total comprehensive income

-

275,662

-

275,662

Balance at 31 December 2020

31,354

122,177

12,806

166,337

Changes in equity

Issue of share capital

666

-

6,394

7,060

Dividends

-

(209,013

)

-

(209,013

)

Total comprehensive income

-

201,954

-

201,954

Balance at 31 December 2021

32,020

115,118

19,200

166,338

1.	STATUTORY INFORMATION

Circuit Group 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 General 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.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Tangible fixed assets

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

Freehold property

-

in accordance with the property

Plant and machinery

-

25% on cost and 25% on reducing balance

Fixtures and fittings

-

25% on cost and 25% on reducing balance

Motor vehicles

-

25% on cost and 25% on reducing balance

Computer equipment

-

25% on cost

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

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

Hire purchase and leasing commitments

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 group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

3.	EMPLOYEES AND DIRECTORS

2021

2020

£

£

Wages and salaries

633,591

711,750

Social security costs

17,326

17,913

Other pension costs

12,651

35,687

663,568

765,350

The average number of employees during the year was as follows:

2021

2020

20

23

The average number of employees by undertakings that were proportionately consolidated during the year was 20 (2020 - 23 ) .

4.	OPERATING PROFIT

The operating profit is stated after charging:

2021

2020

£

£

Depreciation - owned assets

28,739

16,025

5.

TAXATION

Analysis of the tax charge

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

2021

2020

£

£

Current tax:

UK corporation tax

51,031

68,661

Prior year adjustment

-

332

Total current tax

51,031

68,993

Deferred tax

6,548

(221

)

Tax on profit

57,579

68,772

6.	INDIVIDUAL INCOME STATEMENT

As permitted by Section 408 of the Companies Act 2006, the Statement of Comprehensive Income of the parent company is not presented as part of these financial statements.

7.

DIVIDENDS

2021

2020

£

£

Ordinary shares of £1 each

Interim

196,437

269,395

Ordinary 3 shares of £1 each

Interim

12,576

7,081

209,013

276,476

8.	TANGIBLE FIXED ASSETS

Group

Fixtures

Freehold

Plant and

and

property

machinery

fittings

£

£

£

COST

At 1 January 2021

-

8,330

13,330

Additions

680,000

-

-

At 31 December 2021

680,000

8,330

13,330

DEPRECIATION

At 1 January 2021

-

8,330

3,340

Charge for year

-

-

2,696

At 31 December 2021

-

8,330

6,036

NET BOOK VALUE

At 31 December 2021

680,000

-

7,294

At 31 December 2020

-

-

9,990

Motor

Computer

vehicles

equipment

Totals

£

£

£

COST

At 1 January 2021

81,235

37,568

140,463

Additions

45,950

-

725,950

At 31 December 2021

127,185

37,568

866,413

DEPRECIATION

At 1 January 2021

58,515

32,353

102,538

Charge for year

23,855

2,188

28,739

At 31 December 2021

82,370

34,541

131,277

NET BOOK VALUE

At 31 December 2021

44,815

3,027

735,136

At 31 December 2020

22,720

5,215

37,925

9.	FIXED ASSET INVESTMENTS

Group

Interest

in other

participating

interests

£

COST

At 1 January 2021

and 31 December 2021

55,000

NET BOOK VALUE

At 31 December 2021

55,000

At 31 December 2020

55,000

Company

Shares in

group

undertaking

£

COST

At 1 January 2021

and 31 December 2021

30,000

NET BOOK VALUE

At 31 December 2021

30,000

At 31 December 2020

30,000

10.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group

Company

2021

2020

2021

2020

£

£

£

£

Trade debtors

844,566

881,444

-

-

Amounts owed by group undertakings

-

-

123,178

124,171

Other debtors

199,966

274,477

20,000

20,000

1,044,532

1,155,921

143,178

144,171