Oakleaf Partnership Limited - Limited company accounts 22.3

REGISTERED NUMBER: 05396257 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements

for the Year Ended 31 March 2022

for

Oakleaf Partnership Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Income Statement

9

Other Comprehensive Income

10

Statement of Financial Position

11

Statement of Changes in Equity

12

Statement of Cash Flows

13

Notes to the Statement of Cash Flows

14

Notes to the Financial Statements

15

DIRECTORS:

Mr B M Forster

Mr R W H Colgan

Mr S N D Hunt

Mrs A Evans

REGISTERED OFFICE:

4 Cedar Park

Cobham Road

Ferndown Industrial Estate

Wimborne

Dorset

BH21 7SF

REGISTERED NUMBER:

05396257 (England and Wales)

SENIOR STATUTORY AUDITOR:

I M Rodd BSc FCA FCCA

AUDITORS:

Ward Goodman Audit Services Ltd

4 Cedar Park

Ferndown Industrial Estate

Wimborne

Dorset

BH21 7SF

The directors present their strategic report for the year ended 31 March 2022.

PRINCIPAL ACTIVITIES

The company provides recruitment services for Human Resource professionals. The services include executive search and selection, permanent recruitment and temporary recruitment solutions.

REVIEW OF BUSINESS

During the year under review, turnover and gross profit increased materially compared to the previous year. Turnover for the year was £12,429,216 compared to £7,355,610 and gross profit increased to £7,954,411 from £3,943,109. Profit before tax increased to £802,725 compared to £278,147.

The directors are satisfied with the company's performance.

It is noted that the business continued it's recovery from Covid during the year-ended 31 March 2022.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks that will have the greatest adverse effects on the performance of the business are identified by the directors to be:

- Macro-economic risk

- Macro-health risk (Covid-19)

- Staff retention

Macro-economic risk is mitigated by providing a range of services that are needed in all stages of the economic cycle and by diversifying our client base to all industry sectors and internationally.

Staff retention risk is managed through a number of measures including investing in training, developing skills, maintaining a competitive remuneration scheme, and creating a strong culture.

KEY PERFORMANCE INDICATORS

The company measures its results against the following key performance indicators:

- Average gross profit per staff headcount

- Conversion ratio - operating profit before tax and amortisation (EBITDA) expressed as a percentage of gross profit

Average gross profit per headcount measures our business efficiency. Conversion ratio measures the relative profitability of the company taking into account all overheads of the business.

The conversion rate (operating profit divided by gross profit) increased to 10.3% (from 7.2% last year*)

2022

2021*

Gross Profit per Headcount

£113,634

£112,660

Conversion Ratio

10.3%

7.2%

* In the prior year, due to the effect of the CJRS, the gross profit per head was restated using active average headcount of 35, rather than absolute average headcount of 67 (as per note 3).

OUTLOOK FOR THE YEAR AHEAD

The company recovered well after Coronavirus negatively affected performance last year. The business has seen steady growth in vacancies month on month to a 3 year high in March 2022, back to pre-Covid trading levels and profits.

All parts of the business have grown by adding both entry level and experienced consultants. The success of the Total Rewards Search niche business has led to further market development into the USA, replicating our core services from the UK. The new Technology, Change & Transformation business continues to expand and is a key diversification strategy.

The demand for HR professionals continues to be strong, but there is the threat of disruption from a returning Coronavirus outbreak as well as macro-economic effects. High inflation, the war in Ukraine and recession data is pointing towards a turbulent next 12 months as businesses look to right size and reduce costs. This also provides an opportunity in some areas as clients require expertise in restructuring.

The Directors believe the company is well positioned for long term growth and continues to invest across its expanding markets.

ON BEHALF OF THE BOARD:

Mr R W H Colgan - Director

15 December 2022

The directors present their report with the financial statements of the company for the year ended 31 March 2022.

DIVIDENDS

Dividends of £1,500,000 have been paid or declared during the year.

DIRECTORS

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

Mr B M Forster

Mr R W H Colgan

Mr S N D Hunt

Mrs A Evans

DISCLOSURE IN THE STRATEGIC REPORT

In accordance with S414C certain matters which are required to be disclosed in the Report of the Directors have been omitted as they are included within the Strategic Report. These matters relate to the review of business, outlook and future developments and principal risks and uncertainties.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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, Ward Goodman Audit Services Ltd, were appointed during the year and will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr R W H Colgan - Director

15 December 2022

Opinion

We have audited the financial statements of Oakleaf Partnership Limited (the 'company') for the year ended 31 March 2022 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 March 2022 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 Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, 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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 obtained an understanding of the legal and regulatory frameworks applicable to the company and the sector in which they operate. We determined that the following laws and regulations were most significant: the Companies Act 2006, the UK Corporate Governance Code and UK corporate taxation laws.

- We obtained an understanding of how the company are complying with those legal and regulatory frameworks by making inquires to the management. We corroborated our inquiries through our review or board minutes.

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

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

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

o Challenging assumptions and judgments made by management in its significant accounting estimates;

o Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations; and

o Assessing the extent of compliance with the relevant law and regulations.

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.

I M Rodd BSc FCA FCCA (Senior Statutory Auditor)

for and on behalf of Ward Goodman Audit Services Ltd

4 Cedar Park

Ferndown Industrial Estate

Wimborne

Dorset

BH21 7SF

21 December 2022

TURNOVER

12,429,216

7,355,610

Cost of sales

4,474,805

3,412,501

GROSS PROFIT

7,954,411

3,943,109

Administrative expenses

7,276,233

4,398,560

678,178

(455,451

)

Other operating income

144,933

739,711

OPERATING PROFIT

4

823,111

284,260

Interest receivable and similar income

410

565

823,521

284,825

Interest payable and similar expenses

5

20,796

6,678

PROFIT BEFORE TAXATION

802,725

278,147

Tax on profit

6

174,890

53,152

PROFIT FOR THE FINANCIAL YEAR

627,835

224,995

PROFIT FOR THE YEAR

627,835

224,995

OTHER COMPREHENSIVE INCOME

Cancellation of A Ordinary Shares

5

4

Amounts paid for buy back of shares

(50,000

)

(111,440

)

Income tax relating to components of other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

(49,995

)

(111,436

)

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

577,840

113,559

FIXED ASSETS

Intangible assets

8

62,953

79,308

Tangible assets

9

73,661

56,013

136,614

135,321

CURRENT ASSETS

Debtors

10

3,918,683

1,360,926

Prepayments and accrued income

80,774

43,282

Cash at bank and in hand

1,080,581

4,443,022

5,080,038

5,847,230

CREDITORS

Amounts falling due within one year

11

2,042,297

2,122,308

NET CURRENT ASSETS

3,037,741

3,724,922

TOTAL ASSETS LESS CURRENT LIABILITIES

3,174,355

3,860,243

CREDITORS

Amounts falling due after more than one year

12

(500,000

)

(900,000

)

PROVISIONS FOR LIABILITIES

16

(13,996

)

(10,248

)

ACCRUALS AND DEFERRED INCOME

17

(1,281,457

)

(648,928

)

NET ASSETS

1,378,902

2,301,067

CAPITAL AND RESERVES

Called up share capital

18

236

241

Share premium

19

32,848

32,848

Capital redemption reserve

19

459

454

Retained earnings

19

1,345,359

2,267,524

SHAREHOLDERS' FUNDS

1,378,902

2,301,067

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:

Mr R W H Colgan - Director

Called up

Capital

share

Retained

Share

redemption

Total

capital

earnings

premium

reserve

equity

£

£

£

£

£

Balance at 1 April 2020

245

2,153,969

32,848

450

2,187,512

Changes in equity

Issue of share capital

(4

)

-

-

-

(4

)

Total comprehensive income

-

113,555

-

4

113,559

Balance at 31 March 2021

241

2,267,524

32,848

454

2,301,067

Changes in equity

Issue of share capital

(5

)

-

-

-

(5

)

Dividends

-

(1,500,000

)

-

-

(1,500,000

)

Total comprehensive income

-

577,835

-

5

577,840

Balance at 31 March 2022

236

1,345,359

32,848

459

1,378,902

Cash flows from operating activities

Cash generated from operations

1

(1,382,286

)

1,247,303

Interest paid

(20,796

)

(6,678

)

Tax paid

(58,047

)

(154,331

)

Net cash from operating activities

(1,461,129

)

1,086,294

Cash flows from investing activities

Purchase of intangible fixed assets

(26,995

)

(72,826

)

Purchase of tangible fixed assets

(33,796

)

(18,690

)

Sale of intangible fixed assets

9,069

-

Interest received

410

565

Net cash from investing activities

(51,312

)

(90,951

)

Cash flows from financing activities

New loans in year

-

1,200,000

Loan repayments in year

(300,000

)

-

Share issue

(5

)

(4

)

Share buyback

(49,995

)

(111,436

)

Equity dividends paid

(1,500,000

)

-

Net cash from financing activities

(1,850,000

)

1,088,560

(Decrease)/increase in cash and cash equivalents

(3,362,441

)

2,083,903

Cash and cash equivalents at beginning of year

2

4,443,022

2,359,119

Cash and cash equivalents at end of year

2

1,080,581

4,443,022

1.	RECONCILIATION OF PROFIT FOR THE FINANCIAL YEAR TO CASH GENERATED FROM OPERATIONS

2022

2021

£

£

Profit for the financial year

627,835

224,995

Depreciation charges

50,429

67,658

Impairment reversal adjustment

-

(9,854

)

Finance costs

20,796

6,678

Finance income

(410

)

(565

)

Taxation

174,890

53,152

873,540

342,064

(Increase)/decrease in trade and other debtors

(2,595,249

)

1,352,066

Increase/(decrease) in trade and other creditors

339,423

(446,827

)

Cash generated from operations

(1,382,286

)

1,247,303

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 March 2022

31.3.22

1.4.21

£

£

Cash and cash equivalents

1,080,581

4,443,022

Year ended 31 March 2021

31.3.21

1.4.20

£

£

Cash and cash equivalents

4,443,022

2,359,119

3.	ANALYSIS OF CHANGES IN NET FUNDS/(DEBT)

At 1.4.21

Cash flow

At 31.3.22

£

£

£

Net cash

Cash at bank and in hand

4,443,022

(3,362,441

)

1,080,581

4,443,022

(3,362,441

)

1,080,581

Debt

Debts falling due within 1 year

(300,000

)

(100,000

)

(400,000

)

Debts falling due after 1 year

(900,000

)

400,000

(500,000

)

(1,200,000

)

300,000

(900,000

)

Total

3,243,022

(3,062,441

)

180,581

1.	STATUTORY INFORMATION

Oakleaf Partnership Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the 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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The nature of the company's operations and its principal activities are set out in the Directors' Report.

The functional currency of the company is considered to be pounds sterling because that is the currency of the primary economic environment in which the company operates.

Significant judgements and estimates

In the application of the company's accounting policies the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.

The directors believe there to be no material or significant estimates or judgements. Estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

There are no areas that are considered to be key sources of estimation uncertainty.

Turnover

Turnover, which excludes value added tax, represents the invoiced value of services supplied and is recognised on the provision of the service.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Computer software and website is being amortised evenly over its estimated useful life of three years.

Tangible fixed assets

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

Short leasehold

Over the length of the lease

Fixtures and fittings

33% on cost

Computer equipment

33% on cost

Government grants

Government grants shall be recognised in profit or loss on a systematic basis over the periods in which the entity recognises as expenses the related costs for which the grants are intended to compensate.

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 statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight line basis over the period of the lease.

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 provisions for amounts considered irrecoverable.

Creditors

Short term creditors are measured at transaction price. Provisions are measured initially at fair value, and are subsequently revalued annually.

3.	EMPLOYEES AND DIRECTORS

2022

2021

£

£

Wages and salaries

4,909,933

3,205,181

Social security costs

614,479

369,174

Other pension costs

152,255

117,280

5,676,667

3,691,635

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

2022

2021

Number of staff

70

67

2022

2021

£

£

Directors' remuneration

499,739

650,165

Directors' pension contributions to money purchase schemes

21,538

19,605

Information regarding the highest paid director is as follows:

2022

2021

£

£

Emoluments etc

167,530

191,370

Pension contributions to money purchase schemes

8,138

4,140

4.	OPERATING PROFIT

The operating profit is stated after charging:

2022

2021

£

£

Hire of plant and machinery

-

7,585

Other operating leases

302,659

187,942

Depreciation - owned assets

16,148

45,462

Computer software and website amortisation

34,281

22,196

Auditors' remuneration

10,000

9,050

Auditors' remuneration for non audit work

700

750

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

2022

2021

£

£

Bank interest

20,796

5,535

Other interest

-

1,143

20,796

6,678

6.

TAXATION

Analysis of the tax charge

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

2022

2021

£

£

Current tax:

UK corporation tax

171,142

58,047

Deferred tax

3,748

(4,895

)

Tax on profit

174,890

53,152