WILFRED_T._FRY_LIMITED - Accounts

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

Overview

Wilfred T. Fry Limited continued to provide tax consultancy services to a wide spectrum of clients and administrative services to the group.

The directors report a consistent level of revenue at £6.3m (2020 - £6.3m). The company made a loss before taxation of £10k (2020 - £300k) due to the role the company plays within the group of providing administration services to other group companies.

The directors are pleased to see last year's loss much reduced this year. This is due to a thorough review of costs carried out at the outset of the COVID-19 outbreak. The cost base is in a stronger position to support continued growth in the business over the coming years.

The principal risk and uncertainty affecting the company is the pension scheme deficit. This year has seen the deficit reduce due to ongoing contributions to the scheme together with market conditions improving matters.

Considering the interests of customer, supplier, staff and others

The company has invested in building closer relationships with clients. The business has been built on the strength of its relationship with clients and this has been further improved by the use of technology to interact with clients during recent times where it has been more difficult to see clients face to face. Likewise, the company has good long term relationships with suppliers and this has been reflected in no major disruptions during COVID-19 restrictions being in place.

The company’s ability to maintain and build trusted long-term relationships with clients and suppliers is essential to the long term success of the company. It does this by making sure that all staff are trained and qualified to the required level to meet client expectations. Furthermore, the directors ensure that a strong back office infrastructure is in place in the form of compliance, finance and IT functions. The directors also ensure that the business is structured to ensure it identifies new risks as they arise and is able to mitigate these risks to a tolerable level by implementing internal controls.

With regard to suppliers the core value is on quality and value for money when selecting and monitoring third parties. Cost control is assigned to the appropriate department and managers with expertise in a specific area are responsible for maintaining the overall core value.

Staff development and retention is an essential consideration for the directors of the company. The company has a number of policies designed to improve the working lives of its employees including flexible working, support for gender equality and supporting staff voluntary work on overseas aid projects.

Section 172(1) statement

The directors of the group have acted in accordance with their duties codified in law, which include their duty to act in the way in which they consider, in good faith, would be most likely to promote the success of the Group for the benefit of its members as a whole, having regard to the stakeholders and matters set out in section 172(1) of the Companies Act 2006.

The regulatory requirements that other parts of the Group has to meet provide a framework to demonstrate how the board makes decisions for the long term success of the company including having regard to how the board makes sure the business complies with the requirements of section 172 of the Companies Act 2006. The business depends upon long term relationships with clients and suppliers. Decision making and forward planning of the directors takes into consideration the following long term factors:

•    Anticipating client needs

•    Anticipating changes to laws and regulation

•    Investing in IT and security infrastructure

•    Retaining key staff

•    Incorporating sustainability as a core value

                    2021        2020

Tax consultancy fee income        £1.86m        £2.01m

Group fees receivable            £4.43m        £4.28m

Both revenue from tax consultancy and fees receivable from group companies have remained consistent in the period.

The position of the company at the year end is shown on page 9.

The accounting disclosures of the FRS102 Section 28, 'Employee Benefits' have continued to have a significant effect on the net assets of the company, with the scheme deficit standing at £14.02m (2020 - £14.15m). This is however a snapshot of the financial position at the year end date, is volatile year-on-year, and is a long term liability.

On behalf of the board

The principal activity of the company continued to be the provision of tax consultancy services. The company also provides administrative services to the group.

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

The results for the year are set out on page 10.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

The directors note the unlawful dividends approved during the prior year as the company did not have sufficient distributable reserves to distribute dividends. The directors have informed the shareholders that dividends voted since the accounting requirements in respect of defined benefits pensions changed in November 2000 may need to be repaid in the event of the company entering liquidation.

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

The company's principal foreign currency exposures arise from trading with overseas companies and branches. The company's policy permits but does not demand that these exposures may be hedged in order to fix the costs in sterling.

The directors have set out how they have considered the interests of customers, suppliers, staff and others in the strategic report.

World financial markets continue to be uncertain and the current period of volatility is expected to last for the short term. The directors continue to ensure therefore that all avenues for new income streams are fully explored and that cost savings are made whenever possible.

In accordance with the company's articles, a resolution proposing that Carpenter Box be reappointed as auditor of the company will be put at a General Meeting.

During the year the company consumed 42,474 kWh (2020 - 51,189 kWh) of energy. This has been calculated based on invoices from suppliers of energy where available, and where not, this has been based on estimates based on the usage in offices where bills are available.

We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting. The carbon dioxide (and equivalent gases) emitted by the generation of electricity from the UK grid was 9,902 kg CO2e (2020 - 11,934 kg CO2e).

The chosen intensity measurement ratio is total gross emissions in kilograms CO2e per sales revenue, the recommended ratio for the sector. The ratio is 0.00157:1 (2020 - 0.00190:1).

We closed one of our UK offices allowing us to improve our energy efficiency, as well as this we have changed to a renewable energy provider for our main office.

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

The directors have undertaken a robust assessment of the company's future trading prospects and have concluded that the company remains a going concern. See note 1.2 to the financial statements for further detail.

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

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

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

•     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.

We have audited the financial statements of Wilfred T. Fry Limited (the 'company') for the year ended 31 March 2021 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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 company's affairs as at 31 March 2021 and of its loss 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 Auditor's 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

• the information given in the strategic report and the directors' 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.

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 and the directors' report.

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 remuneration specified by law are not made; or

•     we have not received all the information and explanations we require for our audit.

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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.

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.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and

non-compliance with laws and regulations, our procedures included the following:

• Obtaining an understanding of the legal and regulatory framework that the company operates in, focusing on those laws and regulations that had a direct effect on the financial statements and operations;

• Obtaining an understanding of the company’s policies and procedures on fraud risks, including knowledge of any actual, suspected or alleged fraud

• Discussing among the engagement team how and where fraud might occur in the financial statements and any potential indicators of fraud through our knowledge and understanding of the company and our sector-specific experience

As a result of these procedures, we considered the opportunities and incentives that may exist within the company for fraud. We are also required to perform specific procedures to respond to the risk of management override. As a result of performing the above, we identified the following areas as those most likely to have an impact on the financial statements: employment law and compliance with the UK Companies Act.

In addition to the above, our procedures to respond to risks identified included the following:

• Making enquiries of management about any known or suspected instances of non-compliance with laws and regulations and fraud;

• Reviewing minutes of meetings of the board and senior management.

• Challenging assumptions and judgements made by management in their significant accounting estimates.

• Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness.

Due to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.

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

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members, as a body, for our audit work, for this report, or for the opinions we have formed.

The income statement has been prepared on the basis that all operations are continuing operations.

Wilfred T. Fry Limited is a private company limited by shares incorporated in England and Wales. The registered office is Crescent House, Crescent Road, Worthing, West Sussex, BN11 1RN.

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

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

The financial statements have been prepared on the historical cost convention, modified to include the revaluation of certain fixed assets and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel.

The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

The financial statements have been prepared on a going concern basis. The directors have considered relevant information, including the annual budget, forecast future cash flows and the impact of subsequent events in making their assessment. The COVID-19 pandemic and the ensuing economic shutdown has had an impact on the company’s operations, with steps taken both financially and operationally to continue working without major disruption. In response to the COVID-19 pandemic, the directors have performed a robust analysis of forecast future cash flows taking into account the potential impact on the business of possible future scenarios arising from the impact of COVID-19. This analysis also considers the effectiveness of available measures to assist in mitigating the impact.true

Based on these assessments and having regard to the resources available to the entity, the directors have concluded that there is no material uncertainty in relation to the appropriateness of continuing to adopt the going concern basis in preparing the annual report and accounts.

The directors consider this treatment to be appropriate despite the negative retained earnings. This position is due to the accounting requirements for the defined benefit pension scheme liability. The assessment of this liability is over the very long term. The directors believe future forecasts are satisfactory to ensure the going concern basis of accounting is appropriate.

Revenue is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.

Provision for professional services

Revenue for the provision of professional services is recognised, for new clients at the point the insured risk is passed onto the client, and for the existing clients on each anniversary whilst the product is held by the client.

Contracts for services

Revenue from contracts for the provision of professional services is recognised by reference to the right of consideration based on the fair value of the work completed, reflecting any uncertainties as to outcome or recoverability. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable.

Amounts receivable on contracts are included in trade receivables, less foreseeable losses and amounts received as progress payments on account. Payments on account received in excess of revenue are included in trade payables.

Group fees

Revenue from group fees and commissions are based on a fixed percentage of revenue, which is received from a subsidiary of this company.

Service charge receivable

Revenue is recognised based on management's time spent at subsidiary companies.

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

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

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

Interests in subsidiaries and jointly controlled entities are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Transaction costs are expensed to profit or loss as incurred. Changes in fair value are recognised in other comprehensive income except to the extent that a gain reverses a loss previously recognised in profit or loss, or a loss exceeds the accumulated gains recognised in equity; such gains and loss are recognised in profit or loss.

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss.

Cash and cash equivalents are basic financial assets and include cash in hand and deposits held at call with banks.

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

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

The company enters into basic financial instrument transactions that result in recognition of financial assets and liabilities like trade and other accounts receivable and payable and loans to and from fellow group companies.

Debt instruments like loans to and from group undertakings and other accounts receivable and payable are initially measured at the transaction price (including transaction costs) and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year are measured, initially and subsequently at the undiscounted amount of the cash or other considered expected to be paid or received.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity. Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

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

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

The tax currently payable is based on taxable profit for the year.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

The costs of short-term employee benefits are recognised as a liability and an expense.

The company operates an employee share ownership plan (ESOP) trust and has de facto control of the shares held by the trust and bears their benefits and risks. The company records assets and liabilities of the trust as its own. Consideration paid by the ESOP scheme for shares of the company is deducted from equity. Finance costs and administrative expenses incurred by the company in relation to the ESOP are recognised on an accruals basis.

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

The company also operates a defined benefit plan. The cost of providing benefits under defined benefit plans is determined separately for each plan using the projected unit credit method, and is based on actuarial advice.

The change in the net defined benefit liability arising from employee service during the year is recognised as an employee cost. The cost of plan introductions, benefit changes, settlements and curtailments are recognised as an expense in measuring profit or loss in the period in which they arise.

The net interest element is determined by multiplying the net defined benefit liability by the discount rate, taking into account any changes in the net defined benefit liability during the period as a result of contribution and benefit payments. The net interest is recognised in profit or loss as other finance revenue or cost.

Remeasurement changes comprise actuarial gains and losses, the effect of the asset ceiling and the return on the net defined benefit liability excluding amounts included in net interest. These are recognised immediately in other comprehensive income in the period in which they occur and are not reclassified to profit and loss in subsequent periods.

The net defined benefit pension asset or liability in the statement of financial position comprises the total for each plan of the present value of the defined benefit obligation (using a discount rate based on high quality corporate bonds), less the fair value of plan assets out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is the published bid price. The value of a net pension benefit asset is limited to the amount that may be recovered either through reduced contributions or agreed refunds from the scheme.

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

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

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

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

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions or at an average rate where this rate approximates the actual rate at the date of the transaction. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation are included in the income statement for the period.

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

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

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

As detailed in note 1.2 the directors have concluded that there is no material uncertainty relating to going concern for the company and have continued to adopt the going concern basis in preparing the financial statements.

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

As stated in the accounting policy at note 1.3 revenue is recognised based on the fair value of the work completed. At the year end the directors therefore review work in progress to estimate recoverable services undertaken but not invoiced.

As stated in note 19 to the accounts, the defined benefit scheme has been valued on a roll forward method based on the latest full actuarial valuation.

As stated in notes 1.5 and 14 investments in subsidiaries are held at fair value. The key estimates and assumptions used in the fair value model of its personal investment firms are 2.16% (2020 - 2.00%) of funds under advice 3.09 (2020 - 3.68) multiple of recurring fees, and 30% (2020 - 30%) discount factor

An analysis of the company's revenue is as follows:

In the current year, the company paid audit and non-audit fees on behalf of group companies of £36,100 (2020 - £31,000).

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

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2020 - 5).

During the year, the company extended loans to three existing shareholders to fund their purchase of additional shares. The exceptional expense recognised is a provision against these loans, being the directors' estimate of the value of the loans that is not expected to be recoverable.

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

In addition to the amount charged/(credited) to the income statement, the following amounts relating to tax have been recognised directly in other comprehensive income:

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Consolidated financial statements for Fry Wealth Limited, the ultimate parent company are prepared and publicly available.

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

Registered office addresses (all UK unless otherwise indicated):

Listed investments included above:

The market value of the listed investments is not materially different from the historic cost of £30,000 (2020 - £30,000).

Fixed asset investments at fair value

The directors' have valued the company's holdings in its subsidiaries at fair value. The method used for the personal financial planning subsidiaries was in line with industry standards of valuing financial service companies, based on level of funds under advice and renewal income and applying multiples or percentages as appropriate based on current market conditions and discounted where necessary.

The method used for valuing other subsidiaries was based on the recurring fee income and discounted where necessary.

Details of the company's joint ventures at 31 March 2021 are as follows:

The joint venture has been accounted for under the gross equity method. The company's share of the joint venture's profits for the year ended 31 March 2021 was £13,125 (2020 - £5,835 loss) .

Registered Office address:

1) 160 Robinson Road, #17-01, SBF Centre, Singapore 068914

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

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

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so.

The revaluation deferred tax liabilities and the retirement benefit deferred tax assets, as set out above, are expected to reverse over a period of greater than one year.

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund.

Introduction

The company operates a defined benefit pension scheme which is closed to new entrants. The most recent full actuarial valuation was on 31 March 2020 and was carried out by a qualified independent actuary.

The roll forward method has been used, based on the most recent comprehensive actuarial valuation. Adjustments were made to reflect benefits paid out, in addition to, differences between the assumptions used at the year end and those in the comparatives.

The assets of the scheme are invested in a Legal and General Fund. At 31 March 2021 the fair value of the assets has been determined as the market value of the policy. Legal and General have provided a market value as at 31 March 2021 of £17,294,000 (2020 - £15,417,000) and as at 31 March 2021 the scheme's bank balance was £108,406 (2020 - £63,027) and insured annuities are £1,752,000 (2020 - £2,612,000).

The defined benefit plan is currently underfunded, and so is in deficit. As a result, the Trustees' have agreed with the company, deficit payment contributions of £70,000 per month less member contributions, rising by 3% per annum compound from each April until 31 March 2040. In addition monthly contributions one off payments will be required of £140,000 by 31 December 2021 and £160,000 by 31 December 2022. The company has also agreed to pay additional amounts, based on a ‘profit share’ agreed by the company and the Trustees.

The expected total contributions for the year ending 31 March 2022 was estimated to be £984,200.

These payments are designed to eliminate the deficit, pay the expenses of running the Scheme and meet the costs of future accrual for remaining active members.

The total current service cost represents the cost of the pension rights accrued in the coming year (net of employee contributions), pension scheme administration costs and the Pension Protection Levy.

Assumed life expectations on retirement at age 65:

Future pension increases     2021     2020

     %     %

Pre88 GMP (3.0% fixed)*     3.00     3.00

Post88 GMP (3.0% fixed)     3.00     3.00

Pre 01/04/1993 excess over GMP (3.0% fixed)*     3.00     3.00

Post 01/01/1993 excess over GMP (5.0% fixed)     5.00     5.00

Post 01/04/1997 (LPI min 3.0%, max 5.0%)**     3.50/3.00     3.00/3.00

Post 06/03/2006 (LPI max 2.5%)***     2.50/2.50     2.50/1.50

Statutory increases in deferment CPI 2.40 1.50

Statutory increases in deferment RPI 3.40 2.50

*Prior to 2012 assumed to be 0.0% and LPI minimum of 3.0% respectively. Now fixed 3.0% as per legal advice.

**For service post 01/04/1997 previously assumed to be LPI max 5.0%. Now LPI min 3.0% max 5.0% as per legal advice. Lower figures based on CPI pension increases and higher figures based on RPI pension increases.

***For service post 06/03/2006 previously assumed to be post 05/04/2005. Changed as per legal advice. Lower figures based on CPI pension increases and higher figures based on RPI pension increases.

(i) For members who left the scheme before 10 February 2010, members' deferred pensions in excess of GMP increase before retirement, in line with RPI up to 1 January 2011 and CPI from 1 January 2011 although the total increase over the whole period between leaving and retirement, is restricted so that it does not exceed 5.0% per annum compound. The assumption of 1.5% per annum in respect of future revaluation is calculated in this way. For members who left the scheme on or after 10 February 2010, members' deferred pensions in excess of GMP increase before retirement in line with RPI, again the total increase over the whole period between leaving and retirement is restricted so that it does not exceed 5.0% per annum compound. The assumption this year for this type of revaluation is 3.5% per annum.

The expected return on annuity policies is taken to be the discount rate used to value the pensioner liabilities.

The overall expected return on all the scheme assets is 2.3% (2020 - 2.4%) which is set at the same rate as the discount rate as required by the standard.

Amounts recognised in the income statement

Amounts taken to other comprehensive income

The amounts included in the statement of financial position arising from the company's obligations in respect of defined benefit plans are as follows:

Movements in the present value of defined benefit obligations

The defined benefit obligations arise from plans which are wholly funded.

Movements in the fair value of plan assets

The actual return on plan assets excluding annuity policies was £2,323,000 (2020 - (£680,000)).

Fair value of plan assets at the reporting period end

Each share is entitled to one vote in any circumstances and each share is also entitled pari passu to dividend payments or any other distribution, including a distribution arising from a winding up of the company.

The directors continue to separate revaluation reserves in order to distinguish between unrealised reserves which are not available for distribution.

Other reserves represent the balance owed to The Wilfred T. Fry Staff Share Trust, an ESOP trust. The advances to the ESOP trust have been treated as a reduction in reserves, as this is an asset to the sponsoring entity (Wilfred T. Fry Limited) and not an entity in its own right.

Includes all current and prior year retained profits and losses.

The directors note that they paid unlawful dividends during the prior period, as the company does not have sufficient reserves to distribute any dividends due to the accounting requirements of recognising defined benefit pension scheme obligations. The directors informed the shareholders that dividends may need to be repaid in the event of the company entering liquidation.

The parent company's financial loan provider holds a fixed and floating charge over all of the assets of the company as well as a negative pledge.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

During the year, the company extended loans totalling £564,978 to three existing shareholders, who are also wives of the directors, to fund their purchase of additional shares. Interest has been charged at a rate of 2% per annum, and £46,380 of these loans has been repaid as at 31 March 2021.

The balance of £525,333 due from the shareholders as at 31 March 2021, being capital of £518,598 and interest of £6,735, has been provided for in full based on the directors consideration of recoverability. The related expense is presented as an exceptional item in the Statement of Comprehensive Income.

The company is a 100% subsidiary of Fry Wealth Limited, a company without one single ultimate controlling party. Fry Wealth Limited was under the control of its directors for the whole period.

Fry Wealth Limited prepares consolidated financial statements which are available from Companies House, Cardiff.