NGJ_HOLDINGS_LIMITED - Accounts

The directors present the strategic report for the year ended 31 December 2021.

The group reported a profit for the year ended 31 December 2021 of £2,491,490 (year ended 31 December 2020 £1,411,882).

NGJ Holdings Limited holds several investment properties that have been or are in the process of being developed and let out to tenants. The investment properties consist of both commercial and private properties. During 2021 various units at the Chapel Hill development site were completed and made available for rent; all vacant units have tenants in them and are earning rental income for the company; there were no unoccupied completed units at the balance date. The company also purchased Dairy Cottages in Chaigley during the 2021 financial year, which consists of 5 private residence cottages, again all these properties were occupied by tenants and earning rental income for the company at the balance sheet date.

The company also owns sites which are being developed for resale; these are held in stock on the company’s balance sheet. During 2021 the company sold the last 2 remaining properties at Inglewhite Road (development site 1). There are also 2 more development sites at Inglewhite Road where a housing development is partially complete. This housing development has been on hold throughout 2021 as there is a third-party investor interested in purchasing the site in its current state. Negotiations have been underway during the year, but the site remains in its unfinished state at the balance sheet date. The directors are confident that the housing development will be sold soon. A further site (New Drop) was purchased in May 2021 for development and re-sale. Construction work on the new site (New Drop) has been underway in 2021. The original property consists of a public house, a residential cottage and a holiday let.  The public house is being converted into four residential dwellings, the residential cottage is being refurbished and the holiday let is being refurbished and converted back to a residential dwelling.

NGJ Holdings Limited owns various plant and machinery (cranes, etc.) which are hired out to its subsidiary, Steel Work Construction Limited. The company also provides consultancy services to its subsidiary; the managing director tenders for steel erection contracts on behalf of the subsidiary company. The inter-company trading has been eliminated in the consolidated accounts.

The main subsidiary of the group, Steel Work Construction Limited is a Lancashire based firm of steel erectors working throughout the UK who provide fully trained labour and associated plant to erect steel framed structures.

Throughout 2021 the company has continued to carry out erection contracts for some of the UK's leading structural steelwork contractors, and is proud to have been part of the team that has constructed some of the largest steel structure warehouses in the UK.

Safety is the company's top priority. The workforce is fully trained and dedicated to carrying out work safely, efficiently and accurately. All erectors are CSCS, CPCS and IPAF pal+ certified. Supervisors undergo the highest level of training and hold the Crane Supervisor and CITB Site Supervisor's Safety Scheme (SSSTS) certificates.

The company's performance and systems are reviewed each month. Where necessary, a zero tolerance approach to potential breaches to health, safety and environmental practices is invoked.

The only other subsidiary of the group, The Dog Inn at Longridge Limited, did not trade during 2021.

NGJ Holdings Limited sold two of its shares in Steel Work Construction Limited to one of the directors and site supervisor of the subsidiary in November 2021. No further share sales are planned for the near future.

Covid-19

The Covid-19 pandemic has brought many uncertainties to businesses throughout the world, but demand for property has remained high. The health and safety of the workforce, both employees and subcontractors, has remained a priority throughout the pandemic.

Reputation

Both companies have a good reputation and pride themselves on delivering high quality results. There has been no instance throughout 2021 that could be seen to have a negative impact on the reputation of the companies.

Competition

Steel erection contracts continue to be successfully tendered for in the new fiscal year, ensuring a constant cashflow and the ability to comfortably cover the financial commitments of the group.

The directors monitor the performance of the company by reference to turnover growth and profitability, which has been increasing year on year for the past few years.

Revenue growth

2021 has been a highly successful year with group turnover increasing by £4.7m (45%). Turnover for the next fiscal year is expected to be like that of 2021. Results so far for the 2022-year show this to be the case.

Profit margin

Operating profit in 2021 for the group increased by 2.7% on the previous fiscal year. Management is expecting a similar operating profit for 2022.

On behalf of the board

The directors present their annual report and financial statements for the year ended 31 December 2021.

The principal activity of the company and group continued to be that of structural steelwork contractors, property rental and property development.

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £340,000. The directors do not recommend payment of a further dividend.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The directors are responsible for preparing the Annual Report 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 group and company, 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;

•     state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;

•     prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

Qualified opinion on financial statements

We have audited the financial statements of NGJ Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2021 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including 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, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:

•     give a true and fair view of the state of the company's 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 qualified opinion

We were unable to determine whether the sales in respect of steel structure erection within the subsidary's financial statements were not understated, due to there being insufficient records to perform audit testing. We were unable to confirm during our audit testing whether sales were correct for completeness or cut off.

In respect solely of the limitation on our work relating to sales cut off, described above:

•     we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and

•     we were unable to determine whether adequate accounting records had been maintained.

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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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 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 other information comprises the information included in the annual report other than the financial statements and our auditor's 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.

Opinions on other matters prescribed by the Companies Act 2006

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

•     the information given in the strategic report and the directors' eport for the financial year for which the financial statements are prepared is consistent with the financial statements; and

•     the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In respect solely of the the limitation on our work relating to sales and cut off in the subsidiary company described above:

•     we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and

•     we were unable to determine whether adequate accounting records had been maintained.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or 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.

As explained more fully in the directors' responsibilities statement, 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 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 parent company or to cease operations, or have no realistic alternative but to do so.

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 auditor's 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 financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outline 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.

We obtain and update our understanding of the company, its activities, its control environment including in relation to the legal and regulatory framework applicable and how the company is complying with that framework. Based on this understanding we determined materiality, identified and assessed the key areas of material misstatements and then design and perform audit procedures in relation to that risk which included.

• Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud.

• Reviewing minutes of meetings of those charged with governance.

• Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company such as health and safety, building regulations and consumer protection.

• Reviewing financial statement disclosure and testing to support documentation to assess compliance with FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

• Consideration of COVID 19 on the company and its internal controls.

• Performing audit work over the risk of management bias and override of controls.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 auditor's 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.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £1,313,183 (2020 - £901,296 profit).

NGJ Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Ashley Head Farm, Ashley Lane, Goosnargh, Preston, PR3 2EE.

The group consists of NGJ Holdings Limited and all of its subsidiaries.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include investment properties at fair value. The principal accounting policies adopted are set out below.

The consolidated group financial statements consist of the financial statements of the parent company NGJ Holdings Limited together with all entities controlled by the parent company (its subsidiaries).

All financial statements are made up to 31 December 2021. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover comprises lease of heavy plant, erection of steelwork constructions, rental income from investment properties, disposal of development properties and sales of services of the director provided in the normal course of business, and is shown net of VAT and other sales related taxes.

Revenue from plant hire is recognised at the time the invoice is raised. Property rental income and the provision of professional services is recognised in the period to which it relates.

Revenue from the sale of development property is recognised on completion and sale of the properties.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss Investment property is not depreciated.

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Determining the fair value of investment properties requires an estimation of the current market values within the property market. The fair value calculation requires the entity to estimate the future cash flows expected to arise from the investment properties and a suitable discount rate in order to calculate present value. The fair value of the investment properties at the balance sheet date was £4,015,634 after a fair value adjustment of £85,786 was recognised during 2021.

Determining the lower of cost and net realisable value of development properties requires an estimation of the current market values within the property market. Development properties are initially recognised at cost. The net realisable value calculation requires the entity to estimate the future cash flows expected to arise from the development properties and a suitable discount rate in order to calculate present value. The stock value at the balance sheet date was £1,210,763. The net realisable value of the current development properties is expected to be higher than current costs, therefore no reduction in stock value has been required in 2021.

Depreciation is considered a key estimate for which management review on an annual basis to ensure that the assets are being depreciated over their estimated useful economic lives. The net book value of fixed assets at the reporting date was £2,453,762 after a depreciation charge of £604,004 was recognised during 2021.

The average monthly number of persons (including directors) employed by the group and company during the year was:

Their aggregate remuneration comprised:

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

Investment property comprises various properties of varying use. The fair value of these investment properties has been arrived at on the basis of a valuation carried out at 31 December 2021 by the director Mr B Lee. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.

The historical cost of the investment property is £3,846,367 (2020: £2,965,386).

Details of the company's subsidiaries at 31 December 2021 are as follows:

Registered office addresses (all UK unless otherwise indicated):

The bank loans are secured by fixed charges over the company's investments properties.

The other loans are secured by a charge over the property New Drop Inn

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

The leases are secured on the assets financed

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

The deferred tax liability set out above relating to accelerated capital allowances is expected to reverse within 12 months. The deferred tax liability relating to the investment properties is not expected to reverse within 12 months

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

Steel Work Construction Limited

The company owns 68% of the issued share capital of Steel Work Construction Limited

During the year the company charged Steel Work Construction Limited for hire of equipment and consultancy fees totalling £1,072,600 (2020 - £1,027,000). No amounts were outstanding at the year end (2020 - £nil)

At 31 December 2021 the company was owed by Steel Work Construction Limited a loan in the amount of £745,224 (2020 - £351,730). The loan is interest free and repayable on demand