Manach Limited Group accounts (Group and Company)

Manach Limited Group accounts (Group and Company)

MANACH LIMITED - Company Information

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COMPANY REGISTRATION NUMBER: NI047280
Manach Limited
Financial Statements
30 April 2021
Manach Limited
Financial Statements
Year ended 30 April 2021
Contents
Pages
Officers and professional advisers
1
Strategic report
2 to 3
Directors' report
4 to 6
Independent auditor's report to the members
7 to 11
Consolidated statement of comprehensive income
12
Consolidated statement of financial position
13
Company statement of financial position
14
Consolidated statement of changes in equity
15
Company statement of changes in equity
16
Consolidated statement of cash flows
17
Notes to the financial statements
18 to 30
Manach Limited
Officers and Professional Advisers
The board of directors
Mrs J Mc Cormack
Mr P T Mc Cormack
Company secretary
Mr P T Mc Cormack
Registered office
Aisling House
50 Stranmillis Embankment
Belfast
BT9 5FL
Auditor
Maneely Mc Cann
Chartered Accountants & Statutory Auditors
Aisling House
50 Stranmillis Embankment
Belfast
BT9 5FL
Bankers
Bank of Ireland
7 Donegall Square North
Belfast
BT1 5LU
Danske Bank
298 Antrim Road
Glengormley
BT36 5EG
Solicitors
Reid Black Solicitors
Six Mile Chambers
59 Main Street
Ballyclare
BT39 9AA
DWF (Northern Ireland) LLP
Jefferson House
42 Queen Street
Belfast
BT1 6HL
Manach Limited
Strategic Report
Year ended 30 April 2021
Principal activities and business review
The principal activity of the parent company is that of being a holding company of a trading subsidiary. The principal activity of the subsidiaries is the manufacture and maintenance of control systems. Turnover remains consistent with the prior year and is in line with the directors' expectations considering the economic environment. The group operates throughout Ireland and Britain. The group's revenues are generated from the manufacture and maintenance of control systems. The results of the group show a pre-tax profit of £48,230 (2020: £234,152) on sales of £5,910,606 (2020: £6,007,089). At the year end the group had net assets of £9,116,406 (2020: £9,092,075). Although the directors are pleased with the profits achieved during the year, they remain cautious due to the current economic climate and continue to seek further contracts throughout Ireland and Britain. Key Performance Indicators Given the straightforward nature of the business, the directors are of the opinion that analysis using KPIs is not necessary for an understanding of the development, performance or position of the business. Principal risks and uncertainties The management of the business and execution of the group's strategies are subject to a number of risks. The group is well placed to deal with any uncertainties that may arise in the current economic downturn and in response to this, the directors are involved in prudent business planning and working closely with the group's key stakeholders. The key business risks and uncertainties affecting the group are considered to be those that impact on the trading subsidiary, namely industry competition and key employee retention. The management of the business and execution of the group's strategies are subject to a number of risks. The group is well placed to deal with any uncertainties that may arise in the current economic downturn and in response to this, the directors are involved in prudent business planning and working closely with the group's key stakeholders. The key business risks and uncertainties affecting the group are considered to be those that impact on the trading subsidiary, namely industry competition and key employee retention.
This report was approved by the board of directors on 27 April 2022 and signed on behalf of the board by:
Mr P T Mc Cormack
Director
Registered office:
Aisling House
50 Stranmillis Embankment
Belfast
BT9 5FL
Manach Limited
Directors' Report
Year ended 30 April 2021
The directors present their report and the financial statements of the group for the year ended 30 April 2021 .
Directors
The directors who served the company during the year were as follows:
Mrs J Mc Cormack
Mr P T Mc Cormack
Dividends
The directors do not recommend the payment of a dividend.
Future developments
The external commercial environment is expected to remain competitive in the year ended 30 April 2020. The directors will continue to seek opportunities to increase profitable turnover, and will focus on managing and mitigating risks to ensure the group is well placed to retain its market position and continued profitability.
Financial instruments
The group's operations expose it to a variety of financial risks in respect to its use of financial instruments that include the effects of changes in credit risk, liquidity risk and interest rate risk. The group has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the group by monitoring levels of debt finance and the related finance costs.
Given the size of the group, the directors have not delegated the responsibility of monitoring financial risk management to a sub committee of the board. The policies set by the board of directors are implemented by the group's finance department.
Foreign exchange risk
While the greater part of the group's revenues and expenses are denominated in sterling, the group is exposed to some foreign exchange risk in the normal course of business. While the group has not used financial instruments to hedge foreign exchange exposure, this position is under constant review.
Credit risk
The group monitors credit risk closely and considers that its current policies of credit checks meets its objectives of managing exposure to credit risk.
Liquidity risk
The group actively maintains a short-term debt finance that is designed to ensure that the group has sufficient funds for operations and planned expansions.
Interest rate risk
The group has interest bearing assets namely cash balances which earn interest at a fixed rate. The directors will revisit the appropriateness of this policy should the group's operations change in size or nature.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' 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 the company and 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 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 company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the group and the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the group and the company's auditor is aware of that information. The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
This report was approved by the board of directors on 27 April 2022 and signed on behalf of the board by:
Mr P T Mc Cormack
Director
Registered office:
Aisling House
50 Stranmillis Embankment
Belfast
BT9 5FL
Manach Limited
Independent Auditor's Report to the Members of Manach Limited
Year ended 30 April 2021
Opinion
We have audited the financial statements of Manach Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 April 2021 which comprise the consolidated statement of comprehensive income, consolidated statement of financial position, company statement of financial position, consolidated statement of changes in equity, company statement of changes in equity, consolidated statement of cash flows 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 FRS 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 April 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; - 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 auditor's 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 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.
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. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the directors' report 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.
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 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.
Responsibilities of directors
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 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.
Auditor's 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 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. 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: Identifying and assessing potential risks related to irregularities In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following: - the nature of the industry and sector, control environment and business performance including the design of the Group's remuneration policies, key drivers for directors' remuneration, bonus levels and performance targets; - results of our enquiries of management about their own identification and assessment of the risks of irregularities; - any matters we identified having obtained and reviewed the Group's documentation of their policies and procedures relating to: - identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; - detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; - the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations; - the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We also obtained an understanding of the legal and regulatory frameworks that the Group operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006 and Taxation Legislation. Audit response to risks identified Our procedures to respond to risks identified included the following: - reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements; - enquiring of management and external legal counsel concerning actual and potential litigation and claims; - performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; - reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC; and - in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in new making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the group's internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group's or the parent company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the group or the parent company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. - Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. 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.
Mr Paul J Mc Cann
(Senior Statutory Auditor)
For and on behalf of
Maneely Mc Cann
Chartered Accountants & Statutory Auditors
Aisling House
50 Stranmillis Embankment
Belfast
BT9 5FL
27 April 2022
Manach Limited
Consolidated Statement of Comprehensive Income
Year ended 30 April 2021
2021
2020
Note
£
£
Turnover
4
5,910,606
6,007,089
Cost of sales
4,555,454
4,427,803
------------
------------
Gross profit
1,355,152
1,579,286
Administrative expenses
1,348,097
1,413,940
Other operating income
5
34,137
68,467
------------
------------
Operating profit
6
41,192
233,813
Interest receivable
10
2,039
339
------------
------------
Profit before taxation
43,231
234,152
Taxation on ordinary activities
11
20,441
67,461
--------
---------
Profit for the financial year
22,790
166,691
--------
---------
Foreign currency retranslation
( 1,039)
641
--------
---------
Total comprehensive income for the year
21,751
167,332
--------
---------
All the activities of the group are from continuing operations.
Manach Limited
Consolidated Statement of Financial Position
30 April 2021
2021
2020
Note
£
£
Fixed assets
Negative goodwill
12
( 361,527)
( 294,675)
Tangible assets
13
1,417,047
1,245,595
------------
------------
1,055,520
950,920
Current assets
Stocks
15
497,848
306,206
Debtors
16
9,814,880
9,802,499
Cash at bank and in hand
2,014,761
2,102,022
-------------
-------------
12,327,489
12,210,727
Creditors: amounts falling due within one year
17
4,265,501
4,063,399
-------------
-------------
Net current assets
8,061,988
8,147,328
------------
------------
Total assets less current liabilities
9,117,508
9,098,248
Provisions
Taxation including deferred tax
18
3,682
6,173
------------
------------
Net assets
9,113,826
9,092,075
------------
------------
Capital and reserves
Called up share capital
23
3,749,488
3,749,488
Profit and loss account
24
5,364,338
5,342,587
------------
------------
Shareholders funds
9,113,826
9,092,075
------------
------------
These financial statements were approved by the board of directors and authorised for issue on 27 April 2022 , and are signed on behalf of the board by:
Mr P T Mc Cormack
Director
Company registration number: NI047280
Manach Limited
Company Statement of Financial Position
30 April 2021
2021
2020
Note
£
£
Fixed assets
Investments
14
3,749,595
3,749,595
Current assets
Debtors
16
5,935
5,935
Creditors: amounts falling due within one year
17
8,407
8,407
-------
-------
Net current liabilities
2,472
2,472
------------
------------
Total assets less current liabilities
3,747,123
3,747,123
------------
------------
Capital and reserves
Called up share capital
23
3,749,488
3,749,488
Profit and loss account
24
( 2,365)
( 2,365)
------------
------------
Shareholders funds
3,747,123
3,747,123
------------
------------
The profit for the financial year of the parent company was £Nil (2020: £ 4,728 loss).
These financial statements were approved by the board of directors and authorised for issue on 27 April 2022 , and are signed on behalf of the board by:
Mr P T Mc Cormack
Director
Company registration number: NI047280
Manach Limited
Consolidated Statement of Changes in Equity
Year ended 30 April 2021
Called up share capital
Profit and loss account
Total
£
£
£
At 1 May 2019
3,749,488
5,175,255
8,924,743
Profit for the year
166,691
166,691
Other comprehensive income for the year:
Foreign currency retranslation
–
641
641
------------
------------
------------
Total comprehensive income for the year
–
167,332
167,332
At 30 April 2020
3,749,488
5,342,587
9,092,075
Profit for the year
22,790
22,790
Other comprehensive income for the year:
Foreign currency retranslation
–
( 1,039)
( 1,039)
------------
------------
------------
Total comprehensive income for the year
–
21,751
21,751
------------
------------
------------
At 30 April 2021
3,749,488
5,364,338
9,113,826
------------
------------
------------
Manach Limited
Company Statement of Changes in Equity
Year ended 30 April 2021
Called up share capital
Profit and loss account
Total
£
£
£
At 1 May 2019
3,749,488
2,363
3,751,851
Loss for the year
( 4,728)
( 4,728)
------------
-------
------------
Total comprehensive income for the year
–
( 4,728)
( 4,728)
At 30 April 2020
3,749,488
( 2,365)
3,747,123
Profit for the year
–
–
------------
-------
------------
At 30 April 2021
3,749,488
( 2,365)
3,747,123
------------
-------
------------
Manach Limited
Consolidated Statement of Cash Flows
Year ended 30 April 2021
2021
2020
£
£
Cash flows from operating activities
Profit for the financial year
22,790
166,691
Adjustments for:
Depreciation of tangible assets
12,257
13,080
Amortisation of intangible assets
102,731
102,731
Government grant income
( 34,137)
( 68,467)
Interest receivable
( 2,039)
( 339)
Unrealised foreign currency (gains)/loss
(1,039)
641
Taxation on ordinary activities
20,441
67,461
Accrued expenses
192,687
1,158,767
Release of negative goodwill
(35,879)
(35,879)
Changes in:
Stocks
( 191,642)
( 132,021)
Trade and other debtors
( 12,381)
( 777,917)
Trade and other creditors
( 226,964)
432,658
---------
------------
Cash generated from operations
( 153,175)
927,406
Interest received
2,039
339
Tax paid
( 65,264)
( 116,487)
---------
---------
Net cash (used in)/from operating activities
( 216,400)
811,258
---------
---------
Cash flows from investing activities
Purchase of tangible assets
( 183,709)
( 13,964)
---------
---------
Net cash used in investing activities
( 183,709)
( 13,964)
---------
---------
Cash flows from financing activities
Proceeds from loans from participating interests
278,711
( 63,228)
Government grant income
34,137
68,467
---------
---------
Net cash from financing activities
312,848
5,239
---------
---------
Net (decrease)/increase in cash and cash equivalents
( 87,261)
802,533
Cash and cash equivalents at beginning of year
2,102,022
1,299,489
------------
------------
Cash and cash equivalents at end of year
2,014,761
2,102,022
------------
------------
Manach Limited
Notes to the Financial Statements
Year ended 30 April 2021
1. General information
The company is a private company limited by shares, registered in Northern Ireland. The address of the registered office is Aisling House, 50 Stranmillis Embankment, Belfast, BT9 5FL.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Disclosure exemptions
The parent company satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following reduced disclosures available under FRS 102:
(a) Disclosures in respect of each class of share capital have not been presented.
(b) No cash flow statement has been presented for the company.
(c) Disclosures in respect of financial instruments have not been presented.
(d) No disclosure has been given for the aggregate remuneration of key management personnel.
Consolidation
The consolidated financial statements incorporate the financial statements of the company and all group undertakings. These are adjusted, where appropriate, to conform to group accounting policies. Acquisitions are accounted for under the acquisition method and goodwill on consolidation is capitalised and written off over twenty years from the year of acquisition. The result of companies acquired or disposed of are included in the group profit and loss account after or up to the date that control passes respectively. As a consolidated group profit and loss account is published, a separate profit and loss account for the parent company is omitted from the group financial statements by virtue of section 408 of the Companies Act 2006.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably. Revenue from the rendering of services is measured by reference to the stage of completion of the service transaction at the end of the reporting period provided that the outcome can be reliably estimated. When the outcome cannot be reliably estimated, revenue is recognised only to the extent that it is probable the expenses recognised will be recovered.
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.
Goodwill
Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Goodwill
-
5% straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Pland & Machinery
-
25% reducing balance
Fixtures & Fittings
-
25% reducing balance
Motor Vehicles
-
25% reducing balance
Equipment
-
25% reducing balance
If there is an indication that there has been a significant change in depreciation rate, useful life or residual value of tangible assets, the depreciation is revised prospectively to reflect the new estimates. The annual depreciation charge which would be necessary to write down the book value of the land and buildings to residual value is considered to be immaterial and is therefore not provided for.
Investments
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.
Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.
Financial instruments
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 entity after deducting all of its financial liabilities.
Defined contribution plans
The pension costs charged in the financial statements represent the contribution payable by the company during the year. The regular cost of providing retirement pensions and related benefits is charged to the profit and loss account over the employees' service lives on the basis of a constant percentage of earnings.
4. Turnover
Turnover arises from:
2021
2020
£
£
Rendering of services
5,910,606
6,007,089
------------
------------
The whole of the turnover is attributable to the principal activity of the group wholly undertaken in the United Kingdom.
5. Other operating income
2021
2020
£
£
Government grant income
34,137
68,467
--------
--------
6. Operating profit
Operating profit or loss is stated after charging/crediting:
2021
2020
£
£
Amortisation of intangible assets
102,731
102,731
Depreciation of tangible assets
12,257
13,080
Reversal of impairment of intangible assets recognised in:
Administrative expenses
(35,879)
(35,879)
Impairment of trade debtors
(1,161)
6,028
Operating lease rentals
136,116
126,593
Foreign exchange differences
( 30,981)
( 38,343)
---------
---------
7. Auditor's remuneration
2021
2020
£
£
Fees payable for the audit of the financial statements
18,500
18,500
--------
--------
8. Particulars of employees
The average number of persons employed by the group during the year, including the directors, amounted to:
2021
2020
No.
No.
Administrative staff
3
16
Number of other staff - desc in a/c
4
16
Number of other staff - desc in a/c
52
188
----
----
59
220
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2021
2020
£
£
Wages and salaries
2,183,165
2,033,615
Social security costs
226,726
168,994
Other pension costs
163,860
59,873
------------
------------
2,573,751
2,262,482
------------
------------
9. Directors' remuneration
The directors' aggregate remuneration in respect of qualifying services was:
2021
2020
£
£
Remuneration
292,212
174,828
---------
---------
The number of directors who accrued benefits under company pension plans was as follows:
2021
2020
No.
No.
Defined contribution plans
3
2
----
----
Remuneration of the highest paid director in respect of qualifying services:
2021
2020
£
£
Aggregate remuneration
100,613
95,347
---------
--------
10. Interest receivable
2021
2020
£
£
Interest on bank deposits
2,039
339
-------
----
11. Taxation on ordinary activities
Major components of tax income
2021
2020
£
£
Current tax:
UK current tax income
22,932
65,264
Adjustments in respect of prior periods
–
( 548)
--------
--------
Total current tax
22,932
64,716
--------
--------
Deferred tax:
Origination and reversal of timing differences
( 2,491)
2,745
--------
--------
Taxation on ordinary activities
20,441
67,461
--------
--------
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is lower than (2020: higher than) the standard rate of corporation tax in the UK of 19 % (2020: 19 %).
2021
2020
£
£
Profit on ordinary activities before taxation
43,231
234,152
--------
---------
Profit on ordinary activities by rate of tax
23,990
62,653
Adjustment to tax charge in respect of prior periods
–
(104)
Effect of expenses not deductible for tax purposes
392
2,842
Effect of capital allowances and depreciation
( 1,450)
( 675)
Deferred tax movement
( 2,491)
2,745
--------
---------
Tax on loss
20,441
67,461
--------
---------
12. Intangible assets
Group
Goodwill
£
Cost
At 1 May 2020 and 30 April 2021
1,337,050
------------
Amortisation
At 1 May 2020
1,631,725
Charge for the year
102,731
Release of negative goodwill
( 35,879)
------------
At 30 April 2021
1,698,577
------------
Carrying amount
At 30 April 2021
( 361,527)
------------
At 30 April 2020
( 294,675)
------------
The company has no intangible assets.
13. Tangible assets
Group
Land and buildings
Plant and machinery
Fixtures and fittings
Motor vehicles
Equipment
Total
£
£
£
£
£
£
Cost
At 1 May 2020
1,200,656
81,689
45,562
77,883
220,688
1,626,478
Additions
169,638
–
8,312
–
5,759
183,709
------------
--------
--------
--------
---------
------------
At 30 Apr 2021
1,370,294
81,689
53,874
77,883
226,447
1,810,187
------------
--------
--------
--------
---------
------------
Depreciation
At 1 May 2020
–
80,239
39,782
53,958
206,904
380,883
Charge for the year
–
362
2,002
5,891
4,002
12,257
------------
--------
--------
--------
---------
------------
At 30 Apr 2021
–
80,601
41,784
59,849
210,906
393,140
------------
--------
--------
--------
---------
------------
Carrying amount
At 30 Apr 2021
1,370,294
1,088
12,090
18,034
15,541
1,417,047
------------
--------
--------
--------
---------
------------
At 30 Apr 2020
1,200,656
1,450
5,780
23,925
13,784
1,245,595
------------
--------
--------
--------
---------
------------
The company has no tangible assets.
14. Investments
The group has no investments.
Company
Shares in group undertakings
£
Cost
At 1 May 2020 and 30 April 2021
3,749,595
------------
Impairment
At 1 May 2020 and 30 April 2021
–
------------
Carrying amount
At 1 May 2020 and 30 April 2021
3,749,595
------------
At 30 April 2020
3,749,595
------------
Subsidiaries, associates and other investments
Details of the investments in which the parent company has an interest of 20% or more are as follows:
Class of share
Percentage of shares held
Subsidiary undertakings
ATC Systems Limited
Ordinary
100
Complete Controls Solutions Limited
Ordinary
100
Investments in associates and joint ventures
15. Stocks
Group
Company
2021
2020
2021
2020
£
£
£
£
Work in progress
233,794
170,225
–
–
Finished goods
264,054
135,981
–
–
---------
---------
----
----
497,848
306,206
–
–
---------
---------
----
----
16. Debtors
Group
Company
2021
2020
2021
2020
£
£
£
£
Trade debtors
1,482,755
1,715,883
–
–
Amounts owed by undertakings in which the company has a participating interest
8,256,365
7,974,680
–
–
Prepayments and accrued income
69,715
105,892
–
–
Other debtors
6,045
6,044
5,935
5,935
------------
------------
-------
-------
9,814,880
9,802,499
5,935
5,935
------------
------------
-------
-------
17. Creditors: amounts falling due within one year
Group
Company
2021
2020
2021
2020
£
£
£
£
Trade creditors
783,483
1,014,173
–
–
Amounts owed to undertakings in which the company has a participating interest
335,483
56,772
4,728
4,728
Accruals and deferred income
2,696,030
2,505,455
–
–
Corporation tax
22,976
65,308
5
5
Social security and other taxes
414,078
409,449
–
–
Director loan accounts
3,565
3,565
3,565
3,565
Other creditors
9,886
8,677
109
109
------------
------------
-------
-------
4,265,501
4,063,399
8,407
8,407
------------
------------
-------
-------
18. Provisions
Group
Deferred tax (note 19)
£
At 1 May 2020
6,173
Charge against provision
( 2,491)
-------
At 30 April 2021
3,682
-------
The company does not have any provisions.
19. Deferred tax
The deferred tax included in the statement of financial position is as follows:
Group
Company
2021
2020
2021
2020
£
£
£
£
Included in provisions (note 18)
3,682
6,173
–
–
-------
-------
----
----
The deferred tax account consists of the tax effect of timing differences in respect of:
Group
Company
2021
2020
2021
2020
£
£
£
£
Accelerated capital allowances
3,682
6,173
–
( 6,173)
-------
-------
----
-------
20. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 163,860 (2020: £ 59,873 ).
21. Government grants
The amounts recognised in the financial statements for government grants are as follows:
Group
Company
2021
2020
2021
2020
£
£
£
£
Recognised in creditors:
Deferred government grants due within one year
–
2,112
–
–
----
-------
----
----
Recognised in other operating income:
Government grants recognised directly in income
34,137
68,467
–
–
--------
--------
----
----
22. Financial instruments
The carrying amount for each category of financial instrument is as follows:
Financial assets that are debt instruments measured at amortised cost
Group
2021
2020
£
£
Financial assets that are debt instruments measured at amortised cost
9,750,165
9,696,606
------------
------------
Financial liabilities measured at amortised cost
Group
2021
2020
£
£
Financial liabilities measured at amortised cost
1,571,890
1,557,941
------------
------------
23. Called up share capital
Issued, called up and fully paid
2021
2020
No.
£
No.
£
Ordinary shares of £ 1 each
3,749,488
3,749,488
3,749,488
3,749,488
------------
------------
------------
------------
24. Reserves
Profit and loss account - This reserve records retained earnings and accumulated losses.
25. Analysis of changes in net debt
At 1 May 2020
Cash flows
At 30 Apr 2021
£
£
£
Cash at bank and in hand
2,102,022
(87,261)
2,014,761
Debt due within one year
(60,337)
(278,711)
(339,048)
------------
---------
------------
2,041,685
( 365,972)
1,675,713
------------
---------
------------
26. Commitments under operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
Group
Company
2021
2020
2021
2020
£
£
£
£
Not later than 1 year
42,541
53,004
–
–
Later than 1 year and not later than 5 years
25,032
29,321
–
–
--------
--------
----
----
67,573
82,325
–
–
--------
--------
----
----
27. Directors' advances, credits and guarantees
During the year the directors entered into the following advances and credits with the company and its subsidiary undertakings:
Balance brought forward and outstanding
2021
2020
£
£
Mr P T Mc Cormack
( 3,565)
( 3,565)
-------
-------
Manach Limited
Notes to the Financial Statements (continued)
Year ended 30 April 2021
28. Related party transactions
Company
Control The directors are considered to be the ultimate controlling parties by virtue of their shareholdings in Manach Limited . Transactions Group party transactions The group and company has taken advantage of the exemption from disclosing related party transactions with group companies, in accordance with Financial Reporting Standard No 102 Section 33, Related Party Disclosures. Related party transactions The subsidiary Company ATC Systems Limited has the following related party transactions: (ii) Charioteer Limited Mr Patrick Mc Cormack, director, is also a director and shareholder in Charioteer Limited. At the year end a balance of £772,719 (2020: £775,041) is owed from Charioteer Limited to ATC Systems Limited. (iii) Allurach Limited Mr Patrick Mc Cormack is a director of ATC Systems Limited and Allurach Limited. During the year, cash was transferred from Allurach Limited to ATC Systems Limited. At the year end a balance of £7,488,646 (2020: £7,199,639) is owed from Allurach Limited to ATC Systems Limited. (iv) JBC Control Systems Limited Mr Patrick Mc Cormack is a director of ATC Systems Limited and JBC Control Systems Limited. During the year ATC Systems Limited traded with JBC Control Systems Limited. At the year end ATC Systems Limited was owed a trading balance of £54,491 (2020: £NIL) from JBC Control Systems Limited. In addition, a non-trade balance of £385,246 (2020: £54,044) was payable to JBC Control Systems at the year end.