West Yorkshire Ticketing Company Limited - Limited company accounts 20.1

REGISTERED NUMBER: 05238694 (England and Wales)

Strategic Report, Directors' Report and

Audited Financial Statements for the Year Ended 31 March 2021

for

West Yorkshire Ticketing Company Limited

Page

Company Information

1

Strategic Report

2

Directors' Report

4

Report of the Independent Auditors

6

Statement of Comprehensive Income

10

Balance Sheet

11

Statement of Changes in Equity

12

Cash Flow Statement

13

Notes to the Cash Flow Statement

14

Notes to the Financial Statements

15

DIRECTORS:

M Hirst

P Matthews

J D Pearson

H T Robinson

P R Turner

A J Bradley

I A Aldred

J D Binfield

D Gidman

R G A Johnstone

V L Pizzuti

D M Wells

K J Purcell

SECRETARY:

R H Ghent

REGISTERED OFFICE:

3rd Floor

1 Ashley Road

Altrincham

Cheshire

WA14 2DT

REGISTERED NUMBER:

05238694 (England and Wales)

AUDITORS:

Haines Watts

Chartered Accountants &

Statutory Auditors

Sterling House

1 Sheepscar Court

Meanwood Road

Leeds

West Yorkshire

LS7 2BB

BANK:

Lloyds Bank

65-68 Briggate

Leeds

LS1 6LH

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

PRINCIPAL ACTIVITIES

The Company's principal activity is the provision of services to develop, co-ordinate and manage the MCard public transport ticketing scheme. The Company works in partnership with West Yorkshire Combined Authority ("WYCA") to operate and promote this multi-operator, multi-modal ticketing scheme. The Company has entered into a contract with WYCA to administer the scheme. The agreement between the Company, the participating bus and rail operators and WYCA means that the company will make neither a profit nor a loss.

OBJECTIVES OF THE COMPANY

The objectives of the Company are to: -

o provide passengers good value and convenient multi operator and multi modal ticketing;

o maximise travel opportunities across the network;

o offer improved door to door journeys;

o ease interchange between operators and/or between modes;

o reduce boarding times;

o reduce congestion;

o grow the market for passenger transport; and

o support economic and social mobility.

REVIEW OF DEVELOPMENTS AND PROSPECTS

The entire FY 2020-21 took place in the context of Covid-19, with drastically reduced passenger travel and ticket sales. Turnover was just 36% of the previous financial year. However, due to low overheads, the company was able to manage cash flow by temporarily withholding payments to the bus and rail operators participating in the MCard scheme. This ensured sufficient reserves were available to cover all eligible customer refunds. Payments recommenced to bus operators in October 2020 and to rail operators in February 2021. Following the closure of the refund scheme on 19 July 2021, a surplus of £878k that had been held back was distributed to operators in September 2021.

Government messaging during the year largely urged an avoidance of public transport, offering advice on how to travel safely when travel was necessary. As a result, the number of passengers on bus and rail services declined markedly. A full recovery has not yet occurred, and may not occur in the near future due to increased home working and other factors.

As part of the company's Covid-19 recovery plan, marketing has highlighted the advantages of the MCard Mobile app, which was publicly launched in September 2020. As of July 2021, 40% of sales were via the app. A substantial marketing campaign aimed at the Under 19 age group was under development late in the FY for roll-out in prior to the start of the following school year.

The Profit and Loss account for the year is set out on page 9. The Company has reported that gross revenue decreased 64% from £34.6m in FY 2019-20 to £12.6m in FY 2020-21. The Directors consider this to be the main KPI of the business.

PRINCIPAL RISKS AND UNCERTAINTIES

There are potential risks and uncertainties that could have an impact on the Company's performance. Specific business risks faced by the Company include the following: -

External changes to the framework within which the Company operates - either by Government or at the regional or sub-regional level - could result in other bodies taking on some or all of the Company's functions.

Conversely, the Company is currently viewed by the Mayor of West Yorkshire and WYCA as a major delivery partner for West Yorkshire's efforts to improve public transport. It is possible that this will lead to rapid growth that could pose new governance challenges to the Company.

It is not known how the Government's plans for restructuring the rail sector, with Great British Railways as a new public body, will affect the Company's relationship with the train operating companies.

The future role of annual tickets on the bus and rail network is expected to reduce considerably, with more flexible and better-value ticket options to be offered to those travelling less frequently.

GOING CONCERN

The Directors are confident that the Company is able to continue operating as a going concern, is able to carry out its commitments, meet its obligations, and to continue to achieve its objectives.

FUTURE DEVELOPMENTS

The National Bus Strategy ('Bus Back Better') launched in March 2021 strives to radically improve bus services throughout England. Under this strategy, West Yorkshire's Bus Service Improvement Plan will give the Company a larger role in the area's public transport ticketing management and governance. This represents an opportunity for substantial growth, even without net growth in the area's public transport ticket sales.

Challenges include overcoming barriers to growth in sales and patronage across the product range. Although many former public transport users have returned to at least some level of bus and rail usage following the lockdown stages of Covid, it is not yet clear to what extent a recovery will occur, and to what extent behaviour change efforts will succeed. Marketing towards young people in particular will be a focus.

Opportunities include the more widespread adoption and use of the MCard Mobile app, along with the related improvements to the customer experience as well as the improved ease of data collection and sales apportionment.

On 22 July 2021, the Company's updated Joint Venture Agreement ("JVA") was executed. This formalises a host of minor changes since 2008 in the way the Company operates. The Company's Articles of Association are to be updated in line with the JVA changes.

ON BEHALF OF THE BOARD:

Director

20 December 2021

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

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2021.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2020 to the date of this report.

M Hirst

P Matthews

J D Pearson

H T Robinson

P R Turner

A J Bradley

D Gidman

R G A Johnstone

V L Pizzuti

D M Wells

Other changes in directors holding office are as follows:

P Stannard - resigned 30 April 2020

I A Aldred - appointed 25 September 2020

J D Binfield - appointed 1 May 2020

K J Purcell was appointed as a director after 31 March 2021 but prior to the date of this report.

P Sibley ceased to be a director after 31 March 2021 but prior to the date of this report.

FINANCIAL RISK MANAGEMENT OBJECTIVES

The Company's principal financial asset is its bank balances. The risk is managed by holding only one bank accounts with a fixed interest rate. There are no other financial assets or liabilities held by the company.

DISCLOSURE IN THE STRATEGIC REPORT

Disclosures with regard to review of developments and prospects, principle risks and uncertainties and future developments are included in the strategic report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

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

Under section 487(2) of the Companies Act 2006, Haines Watts, will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date perscribed for filing the accounts with the registrar, whichever is earlier.

ON BEHALF OF THE BOARD:

J D Pearson - Director

20 December 2021

Opinion

We have audited the financial statements of West Yorkshire Ticketing Company Limited (the 'company') for the year ended 31 March 2021 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 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.

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

- the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

- the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

However, not all future events or conditions can be predicted. The COVID-19 viral pandemic is one of the most significant economic events for the UK with unprecedented levels of uncertainty of outcomes. It is therefore difficult to evaluate all of the potential implications on the company's trade, customers, suppliers and wider economy. The Directors' view on the impact of COVID-19 is disclosed in the accounting policies in note 3 to the financial statements and in the Strategic Report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Directors' Report, 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

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

Matters on which we are required to report by exception

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

We have nothing to report in respect of the following matters 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 pages four and five, 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:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

- we identified the laws and regulations applicable to the company through discussions with directors and

other management; and from our commercial knowledge and experience of the transport sector

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;

- we assessed the extent of compliance with laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and

- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit

We assessed the susceptibility of the company's financial statements to misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;

- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and

- understanding the design of the company's remuneration policies.

To address the risk of fraud, including any impact of revenue recognition, through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

- assessed whether judgements and assumptions made in determining the accounting estimates set out in

note 3 were indicative of potential bias

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosure to underlying supporting documentation;

- enquiring of management as to actual and potential litigation and claims; and

- reviewing correspondence with HMRC, relevant regulators and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion

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.

Matthew Barton BA (Hons) FCA CTA (Senior Statutory Auditor)

for and on behalf of Haines Watts

Chartered Accountants &

Statutory Auditors

Sterling House

1 Sheepscar Court

Meanwood Road

Leeds

West Yorkshire

LS7 2BB

23 December 2021

TURNOVER

5

12,565

34,611

Administrative expenses

12,565

34,611

OPERATING PROFIT and

PROFIT BEFORE TAXATION

-

-

Tax on profit

8

-

-

PROFIT FOR THE FINANCIAL YEAR

-

-

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

-

-

CURRENT ASSETS

Debtors

9

3,388

5,145

Cash at bank

70

24

3,458

5,169

CREDITORS

Amounts falling due within one year

10

3,458

5,169

TOTAL ASSETS LESS CURRENT LIABILITIES

-

-

CAPITAL AND RESERVES

-

-

The financial statements were approved by the Board of Directors and authorised for issue on 20 December 2021 and were signed on its behalf by:

J D Pearson - Director

Called up

share

Retained

Total

capital

earnings

equity

£'000

£'000

£'000

Changes in equity

Balance at 31 March 2020

-

-

-

Changes in equity

Balance at 31 March 2021

-

-

-

Cash flows from operating activities

Cash generated from operations

1

46

-

Net cash from operating activities

46

-

Increase in cash and cash equivalents

46

-

Cash and cash equivalents at beginning of year

2

24

24

Cash and cash equivalents at end of year

2

70

24

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2021

2020

£'000

£'000

Profit before taxation

-

-

Decrease in trade and other debtors

1,757

146

Decrease in trade and other creditors

(1,711

)

(146

)

Cash generated from operations

46

-

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 March 2021

31/3/21

1/4/20

£'000

£'000

Cash and cash equivalents

70

24

Year ended 31 March 2020

31/3/20

1/4/19

£'000

£'000

Cash and cash equivalents

24

24

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1/4/20

Cash flow

At 31/3/21

£'000

£'000

£'000

Net cash

Cash at bank

24

46

70

24

46

70

Total

24

46

70

1.	STATUTORY INFORMATION

West Yorkshire Ticketing Company 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.	STATEMENT OF COMPLIANCE

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.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared under the historical cost convention.

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

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 in making their assessment. In particular, in response to the COVID-19 pandemic, the Directors have tested their cash flow analysis to take into account the impact on their business of possible scenarios brought on by the impact of COVID-19, alongside the measures that they can take to mitigate the impact. Based on these assessments, given the measures that could be undertaken to mitigate the current adverse conditions, and the current resources available, the Directors have concluded that they can continue to adopt the going concern basis in preparing the annual report and accounts.

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet 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.

Debtors

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

Creditors

Short term creditors are measured at transaction price.

4.	CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Preparation of these financial statements required management to make no significant judgements or estimates.

5.

TURNOVER

The whole of the turnover and result on ordinary activities before taxation derives from the company's principal activities within the United Kingdom. The company has one principal class of business, namely the provision of services to develop, co-ordinate and manage the scheme to sell transport tickets and to promote, in conjuction with the West Yorkshire PTE, multi-modal travel. Turnover is recognised over the period which the associated Multi-operator Travel Card relates to.

6.	EMPLOYEES AND DIRECTORS

There were no staff costs for the year ended 31 March 2021 nor for the year ended 31 March 2020.

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

2021

2020

Directors

12

12

2021

2020

£

£

Directors' remuneration

-

-

7.	AUDITORS' REMUNERATION

2021

2020

£'000

£'000

Fees payable to the company's auditors for the audit of the company's financial statements

7

7

8.

TAXATION

Analysis of the tax charge

No liability to UK corporation tax arose for the year ended 31 March 2021 nor for the year ended 31 March 2020.

9.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2021

2020

£'000

£'000

Other debtors

2,499

903

Prepayments and accrued income

889

4,242

3,388

5,145

10.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2021

2020

£'000

£'000

Other creditors

2,496

884

Accruals and deferred income

962

4,285

3,458

5,169

11.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2021

2020

value:

£

£

219

Ordinary

1

219

219

12.	CONTROLLING PARTY

The directors do not consider that there is a controlling party as the board of directors is made up of representatives from the shareholder organisations, with no director or shareholder having a dominant position.

13.	RELATED PARTY DISCLOSURES

Included within other debtors, are amounts due from participating operators of £2,133,005 (2020: £501,949). The participating operators are related parties, as they are also shareholders of the company.

Total amounts paid to the participating operators during the year was £13,405,850 (2020: £28,871,925).

No further transactions with related parties were undertaken such as are required to be disclosed under FRS 102.