ACCOUNTS - Final Accounts preparation
ACCOUNTS - Final Accounts preparation
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Registered Number:
FOR THE YEAR ENDED 30 NOVEMBER 2020
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COMPANY INFORMATION
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CONTENTS
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STRATEGIC REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2020
The directors present the Strategic report on the company for the year ended 30 November 2020.
The company recorded a profit in the year of £2,043,622 (2019: £3,759,484).
Management monitor the business using the following indicators:
∙Gross profit margin, which is 24.4% in the year (2019: 29.3%).
∙Average number of employees, which is 24 in the year (2019: 26).
The decrease in gross profit percentage is as a result of general market conditions during the year and is not expected to be an on-going concern.
The headcount is in line with ongoing business requirements.
The directors consider the results for the year to be satisfactory and expect performance to improve in the coming years.
The company maintains productivity through the following strategies:
∙improving our Customer Experience and business performance via focus on customers, including a Circle the Customer programme;
∙providing the highest standard of product, service and delivery to customers at a competitive cost;
∙continued expansion into current and new markets; and
∙strong brand recognition through brand and channel management.
Page 1
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2020
The management of the business and the execution of the company's strategy are subject to a number of risks.
The key business risks affecting the company are:
∙currency risk;
∙rate of growth of domestic and European markets; and
∙adverse economic conditions in the European markets.
In response to the risks the company:
∙operates under a group European pooling arrangement that manages and mitigates any currency risk;
∙maintains integrated solutions through technology and product offerings;
∙ensures effective pricing and continued recognition of brand and quality to maintain market position; and
∙maintains a high technology offering while widening its customer base and expanding into new areas.
On a broader note, the Global Epidemic seen thus far in 2020 and 2021 has posed new challenges. Safety continues to be our number one priority. Through the induction of new policies and procedures, we are confident that the company is well positioned to deal with these new challenges going forward, with minimal business interruption.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2020
The directors present their report and the financial statements for the year ended 30 November 2020.
The profit for the year, after taxation, amounted to £2,043,622 (2019 - £3,759,484).
There were no dividends paid in the year (2019: £16,099,000).
The directors who served during the year were:
A review of the business of the company and future developments is included in the Strategic report on page 1.
There have been no significant events affecting the Company since the year end.
The auditor, Anderson Anderson & Brown Audit LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 NOVEMBER 2020
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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), 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 for the Company's financial statements 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 to 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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CHAMPIONX EGYPT LTD.
We have audited the financial statements of ChampionX Egypt Ltd. (the 'Company') for the year ended 30 November 2020, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
The component auditor provided a qualified audit opinion on the financial statements of ChampionX Egypt Ltd. – Egypt Branch on the basis they were unable obtain a bank confirmation in relation to the branch’s bank accounts held with Commercial International Bank (CIB). The component auditor reported they were not able to satisfy themselves regarding the completeness and accuracy of the balances with CIB, or of other potential assets and liabilities (both actual and contingent), transactions, commitments, guarantees and off-balance sheet arrangement and other relevant information related to this bank and the data disclosed related with such bank using other auditing procedures. Consequently, we were therefore unable to satisfy ourselves over the same matters noted by the component auditor.
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 United Kingdom, including the Financial Reporting Council'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 qualified opinion.
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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CHAMPIONX EGYPT LTD. (CONTINUED)
The directors are responsible for the other information. The other information comprises the information included in the Annual report, other than the financial statements and our Auditor's report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the completeness and accuracy of the balance with CIB at 30 November 2020 and the relating items. We have concluded that where the other information refers to assets and liabilities (both actual and contingent), transactions, commitments, guarantees and off-balance sheet arrangement and other relevant information related to this bank, it may be materially misstated for the same reason.
Except for the possible effects of the matter described in the basis for qualified opinion section of our report, 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.
Except for the matter described in the basis for qualified opinion section of our report in which we did not receive all the information we require for our audit, 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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CHAMPIONX EGYPT LTD. (CONTINUED)
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.
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 Auditor's 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.
for and on behalf of
Statutory Auditor
Kingshill View
Prime Four Business Park
Kingswells
AB15 8PU
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STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 NOVEMBER 2020
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BALANCE SHEET
AS AT 30 NOVEMBER 2020
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 11 to 19 form part of these financial statements.
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 NOVEMBER 2020
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
ChampionX Egypt Limited is a private company limited by shares and incorporated in England. The registered office is C/O Champion Technologies Ltd, Block 102, Hardley, Southampton, Hampshire, SO45 3NP. The principal activity of the company is the sale of specialist chemicals by its branch in Egypt.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A.
This information is included in the consolidated financial statements of ChampionX Corporation as at 31 December 2020 and these financial statements may be obtained from 2445 Technology Forest Blvd., Building 4, Suite 1200, The Woodlands, TX 77381.
The directors, having made due and careful enquiry, are of the opinion that the company has adequate working capital to execute its operations over the next 12 months. The directors, therefore, have made an informed judgement, at the time of approving the financial statements, that there is a reasonable expectation that the company had adequate resources to continue in operational existence for the foreseeable future. As a result, the directors have continued to adopt the going concern basis of accounting in preparing the annual financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
Turnover comprises the value of sales of goods and services (excluding VAT and similar taxes and trade discounts).
Revenue is recognised on products when the substantial risks and rewards of goods have been transferred to customers and where services have been provided.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
2.Accounting policies (continued)
Given the nature of the business, the directors consider the carrying value of fixed asset investment to be the key judgemental in the financial statements. The carrying value amount of the company's fixed asset investment is tested as soon as changed conditions show that a a need for an impairment has arisen and is based on expected future performance of the relevant subsidiary companies. Having identified no indictors of impairment management have no made and provisions in the current or prior year financial statements.
No analysis of turnover, operating profit or net assets is presented as the directors believe it would be prejudicial to the interests of the company.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2020
The directors regard ChampionX Corporation, incorporated in USA, as the ultimate parent company and the ultimate controlling party.
ChampionX Corporation is the parent company of the smallest and largest group of which the company is a member and for which group financial statements are drawn up. Copies of the financial statements are available from 2445 Technology Forest Blvd., Building 4, Suite 1200, The Woodlands, TX 77381. The immediate parent undertaking is ChampionX Egypt Holdings Ltd.
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