MD Warranty Support Services Ltd - Limited company accounts 22.3

REGISTERED NUMBER: 04759193 (England and Wales)

Report of the Directors and

Financial Statements for the Year Ended 31 December 2021

for

MD Warranty Support Services Ltd

Page

Company Information

1

Report of the Directors

2

Report of the Independent Auditors

3

Income Statement

6

Balance Sheet

7

Notes to the Financial Statements

8

DIRECTORS:

G Cass

P Homan

REGISTERED OFFICE:

2 Shore Lines Building

Shore Road

Birkenhead

Merseyside

CH41 1AU

REGISTERED NUMBER:

04759193 (England and Wales)

AUDITORS:

Haines Watts

Statutory Auditor

3rd Floor Pacific Chambers

11-13 Victoria Street

Liverpool

Merseyside

L2 5QQ

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

PRINCIPAL ACTIVITY

The principal activity of the company was that of a registered Building Regulations Approved Inspector.

DIRECTOR

G J Devaney held office from 1 January 2021 until after 31 December 2021 but prior to the date of this report.

G Cass and P Homan were appointed as directors after 31 December 2021 but prior to the date of this report.

RISK OF BUSINESS INTERRUPTION

The recent business interruption caused by the COVID-19 Pandemic has provided the business with a present and future risk to consider. The company has taken all steps possible to ensure the safety of our employees whilst working hard to develop processes that ensure the business has the financial resilience to prosper through this difficult period. At present we continue to follow government guidelines and operate cautiously in the wake of an ever evolving economic landscape. Despite the challenges the company has faced throughout the COVID-19 Pandemic, we feel we are in a good position to maximise the opportunity that will inevitably materialise through the growth of the economy.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Haines Watts, will be proposed for re-appointment at the forthcoming Board 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:

P Homan - Director

15 December 2022

Opinion

We have audited the financial statements of MD Warranty Support Services Ltd (the 'company') for the year ended 31 December 2021 which comprise the Income Statement, Balance Sheet and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2021 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

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

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in 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, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	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 Strategic Report or in preparing the Report of the Directors.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page two, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

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.

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

We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the company engagement team included:

- Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;

- Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;

- Reviewing financial statements disclosures and testing to supporting documentation to assess compliance with applicable law and regulations;

- Challenging assumptions and judgements made by management in its significant accounting estimates, in particular:

- Deferred and accrued income - we carried out a review and recalculation of deferred and accrued income to assess its appropriateness for inclusion within the financial statements;

- Depreciation - we carried out a review and recalculation of depreciation to assess its appropriateness for inclusion within the financial statements;

- Identifying and testing journal entries, in particularly any journal entries posted with unusual account combinations.

Despite the audit being planned and conducted in accordance with ISAs (UK) there remains an unavoidable risk that material misstatements in the financial statements may not be detected owing to inherent limitations of the audit, and that by their very nature, any such instances of fraud or irregularity likely involve collusion, forgery, intentional misrepresentations, or the override of internal controls.

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.

Michael Forshaw FCA (Senior Statutory Auditor)

for and on behalf of Haines Watts

Statutory Auditor

3rd Floor Pacific Chambers

11-13 Victoria Street

Liverpool

Merseyside

L2 5QQ

15 December 2022

TURNOVER

1,674,218

1,335,272

Administrative expenses

1,531,874

1,748,248

142,344

(412,976

)

Other operating income

-

314,302

OPERATING PROFIT/(LOSS)

142,344

(98,674

)

Interest payable and similar expenses

2,098

2,352

PROFIT/(LOSS) BEFORE TAXATION

140,246

(101,026

)

Tax on profit/(loss)

-

(16,834

)

PROFIT/(LOSS) FOR THE FINANCIAL YEAR

140,246

(84,192

)

FIXED ASSETS

Intangible assets

4

-

-

Tangible assets

5

21,372

25,077

21,372

25,077

CURRENT ASSETS

Debtors

6

5,129,384

5,264,273

Cash at bank

22,236

4,991

5,151,620

5,269,264

CREDITORS

Amounts falling due within one year

7

4,839,789

5,101,384

NET CURRENT ASSETS

311,831

167,880

TOTAL ASSETS LESS CURRENT LIABILITIES

333,203

192,957

CAPITAL AND RESERVES

Called up share capital

2

2

Retained earnings

333,201

192,955

SHAREHOLDERS' FUNDS

333,203

192,957

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 15 December 2022 and were signed on its behalf by:

P Homan - Director

G Cass - Director

1.	STATUTORY INFORMATION

MD Warranty Support Services Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Significant judgements and estimates

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future event that are believed to be reasonable under the circumstances.

There are not considered to be any critical judgements in applying the company's accounting policies.

Turnover

Turnover includes amounts received in relation to building control services, which are often provided as part of a structural warranty package.

Other operating income

Income from government grants is presented within other operating income for 2020. Grants relating to revenue are recognised as income over the periods when the related costs are incurred. During the year the company claimed £0 (2020 - £94,302) in relation to furlough payments within the governments Coronavirus Job Retention Scheme.

Tangible fixed assets

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

Fixtures and fittings

-

10% on cost

Computer equipment

-

25% on cost

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Pension costs and other post-retirement benefits

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

Debtors

Short term debtors are measured at transaction price, less any impairment.

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty or notice of not more than 24 hours.

Financial instruments

The company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and loans to related parties.

Debt instruments (other than those wholly repayable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received.

Financial assets that are measured at cost and amortised are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the income statement and retained earnings.

Creditors

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

Going concern

The financial statements have been prepared on a going concern basis. The Directors have reviewed and considered relevant information, including the annual budget and future cash flows for the group in making their assessment.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 21 (2020 - 24 ) .

4.	INTANGIBLE FIXED ASSETS

Goodwill

£

COST

At 1 January 2021

and 31 December 2021

376,449

AMORTISATION

At 1 January 2021

and 31 December 2021

376,449

NET BOOK VALUE

At 31 December 2021

-

At 31 December 2020

-

5.	TANGIBLE FIXED ASSETS

Plant and

machinery

etc

£

COST

At 1 January 2021

94,126

Additions

10,200

At 31 December 2021

104,326

DEPRECIATION

At 1 January 2021

69,049

Charge for year

13,905

At 31 December 2021

82,954

NET BOOK VALUE

At 31 December 2021

21,372

At 31 December 2020

25,077

6.

DEBTORS

31.12.21

31.12.20

£

£

Amounts falling due within one year:

Trade debtors

1,036,898

1,603,265

Amounts owed by group undertakings

3,401,446

3,057,643

Other debtors and prepayments

65,071

81,010

4,503,415

4,741,918

Amounts falling due after more than one year:

Trade debtors

625,969

522,355

Aggregate amounts

5,129,384

5,264,273

A bad debt provision of £23,714 (2020 - £48,400) was recognised against trade debtors within the company.

Amounts owed by group undertakings are repayable on demand and attract no interest.

7.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.12.21

31.12.20

£

£

Trade creditors

3,108

40,603

Amounts owed to group undertakings

4,603,123

4,906,459

Taxation and social security

114,488

101,193

Other creditors

119,070

53,129

4,839,789

5,101,384

Amounts owed to group undertakings are repayable on demand and attract no interest.

8.	RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

9.	ULTIMATE CONTROLLING PARTY

The immediate parent undertaking of the company is MD Insurance Services Limited (MDIS), a company incorporated in England and Wales.

This is the smallest group of undertakings to consolidate these financial statements at 31st December 2021.

The consolidated financial statements are filed at Companies House and copies can be obtained from the company's registered office address, as shown on page 1.

As at 31 December 2021 MDIS was deemed to be the ultimate parent company

On 1st April 2022 HSB Engineering Insurance Limited purchased the entire share capital of MDIS and as a result Munchener Ruckversichrungs-Gesellschaft Aktiengesellschaft (Munich Re), a company incorporated in Germany became the company's parent company and controlling party.