Dalziel & Pow Holdings Limited - Limited company accounts 20.1

REGISTERED NUMBER: 10599773 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 July 2021

for

Dalziel & Pow Holdings Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Consolidated Income Statement

8

Consolidated Other Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

DIRECTORS:

D Dalziel

K Ware

A Kean

D R Wright

Mrs S L Fairhurst

M King

T Graveling

R Bennett

P J West

SECRETARY:

Camamile Limited

REGISTERED OFFICE:

15 Newland

Lincoln

LN1 1XG

REGISTERED NUMBER:

10599773 (England and Wales)

AUDITORS:

Wright Vigar Limited

Statutory Auditors

Chartered Accountants & Business Advisers

15 Newland

Lincoln

Lincolnshire

LN1 1XG

The directors present their strategic report of the company and the group for the year ended 31 July 2021.

REVIEW OF BUSINESS

We encountered a very tough first half to the year due to the continuing negative global economic effects of the Covid 19 pandemic. In the second half of the year, market confidence became noticeably stronger which led to business ramping up significantly and this has continued into the current year.

The Directors continue to meet twice a week to discuss business continuity, including client accounts and management, new business opportunities, marketing, workload and operations, cash flow and other financial and business matters. This ensures we manage any potential risks or uncertainties that are encountered by the Group and agree measures to mitigate against them.

PRINCIPAL RISKS AND UNCERTAINTIES

Interest Risks and Liquidity Risks

The Group manages profits to fund growth, develop the business and maintain positive cash balances. Therefore, interest rate and liquidity risks are minimised.

Foreign Exchange Risk

The Group's preferred currency for all transactions is sterling. However, at times it is necessary to transact in other foreign currencies and this increases the risk of foreign exchange uncertainties. The Group monitors foreign exchange exposure on a regular basis and manages its accounts to maximise exchange rate benefit.

Credit Risk

The Group continuously reviews it credit risk with new and current clients. New clients, especially overseas clients, often have reduced credit terms with the requirement to make a payment on account to mitigate the Group's risk. We also regularly produce billing schedules to further minimise risk.

Client Satisfaction

We assess this on a direct one to one basis with the client and use feedback to improve the Group's client offer, match client expectations and retain existing clients. We also regularly carry out independent client surveys.

Key Performance Indicators

Financial and non-financial key performance indicators are reviewed formally by the Directors, on a monthly basis to identify any risks or threats at the earliest possible opportunity and take the appropriate action.

ON BEHALF OF THE BOARD:

K Ware - Director

17 January 2022

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

DIVIDENDS

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

DIRECTORS

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

D Dalziel

K Ware

A Kean

D R Wright

Mrs S L Fairhurst

M King

T Graveling

R Bennett

P J West

Other changes in directors holding office are as follows:

Mrs K Dalziel - resigned 27 January 2021

CHARITABLE CONTRIBUTIONS

The Group is committed to it's Corporate Social Responsibility programme and commits to staff gifting a workday per year to charity. During the year the company also made charitable donations totalling £715 (2020: £515).

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group'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 group's auditors are aware of that information.

ON BEHALF OF THE BOARD:

K Ware - Director

17 January 2022

Opinion

We have audited the financial statements of Dalziel & Pow Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2021 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated 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 group's and of the parent company affairs as at 31 July 2021 and of the group's 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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

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

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

-	adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

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

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 group's and the parent 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 group or the parent 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 work is performed to include an assessment of the susceptibility of the entity's financial statements to material misstatement, including the risk of fraud. Owing to the inherent limitations of an audit, there is an unavoidable risk that 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).

In identifying and assessing risk of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

-

We plan our work to gain an understanding of the significant laws and regulations that are of significance to the entity and the sector in which they operate. We perform our work to ensure that the entity is complying with its legal and regulatory framework.

-

We obtained an understanding of how the company is complying with those legal and regulatory frameworks by making inquiries to the management and people charged with governance.

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

-

Substantive procedures performed in accordance with the ISAs (UK).

-

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

-

Identifying and testing journal entries, in particular material journal entries and an assessment of year end journals.

-

Assessing the extent of compliance with the relevant laws and regulations.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

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

Jon O'Hern FCA (Senior Statutory Auditor)

for and on behalf of Wright Vigar Limited

Statutory Auditors

Chartered Accountants & Business Advisers

15 Newland

Lincoln

Lincolnshire

LN1 1XG

17 January 2022

TURNOVER

3

4,797,969

6,769,645

Cost of sales

1,241,411

2,692,944

GROSS PROFIT

3,556,558

4,076,701

Administrative expenses

3,470,702

4,533,288

85,856

(456,587

)

Other operating income

4

295,055

168,389

OPERATING PROFIT/(LOSS)

6

380,911

(288,198

)

Interest receivable and similar income

7

128

849

381,039

(287,349

)

Amortisation of goodwill

(966,405

)

(966,405

)

(585,366

)

(1,253,754

)

Interest payable and similar expenses

8

108,650

121,556

LOSS BEFORE TAXATION

(694,016

)

(1,375,310

)

Tax on loss

9

118,601

(39,805

)

LOSS FOR THE FINANCIAL YEAR

(812,617

)

(1,335,505

)

Loss attributable to:

Owners of the parent

(812,617

)

(1,335,505

)

LOSS FOR THE YEAR

(812,617

)

(1,335,505

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(812,617

)

(1,335,505

)

Total comprehensive income attributable to:

Owners of the parent

(812,617

)

(1,335,505

)

FIXED ASSETS

Intangible assets

11

5,403,836

6,373,936

Tangible assets

12

93,660

123,794

Investments

13

-

-

5,497,496

6,497,730

CURRENT ASSETS

Debtors

14

1,455,438

1,177,289

Cash at bank and in hand

1,177,701

1,626,989

2,633,139

2,804,278

CREDITORS

Amounts falling due within one year

15

2,370,273

2,207,346

NET CURRENT ASSETS

262,866

596,932

TOTAL ASSETS LESS CURRENT LIABILITIES

5,760,362

7,094,662

CREDITORS

Amounts falling due after more than one year

16

(2,689,583

)

(3,210,000

)

PROVISIONS FOR LIABILITIES

19

(11,419

)

(12,685

)

NET ASSETS

3,059,360

3,871,977

CAPITAL AND RESERVES

Called up share capital

20

1,000

1,000

Merger relief reserve

21

7,223,170

7,223,170

Retained earnings

21

(4,164,810

)

(3,352,193

)

SHAREHOLDERS' FUNDS

3,059,360

3,871,977

The financial statements were approved by the Board of Directors and authorised for issue on 17 January 2022 and were signed on its behalf by:

K Ware - Director

FIXED ASSETS

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

12,500,000

12,500,000

12,500,000

12,500,000

CURRENT ASSETS

Cash at bank

9,659

9,816

CREDITORS

Amounts falling due within one year

15

415,083

138,950

NET CURRENT LIABILITIES

(405,424

)

(129,134

)

TOTAL ASSETS LESS CURRENT LIABILITIES

12,094,576

12,370,866

CREDITORS

Amounts falling due after more than one year

16

2,450,000

2,960,000

NET ASSETS

9,644,576

9,410,866

CAPITAL AND RESERVES

Called up share capital

20

1,000

1,000

Merger relief reserve

21

7,223,170

7,223,170

Retained earnings

21

2,420,406

2,186,696

SHAREHOLDERS' FUNDS

9,644,576

9,410,866

Company's profit for the financial year

233,710

294,135

The financial statements were approved by the Board of Directors and authorised for issue on 17 January 2022 and were signed on its behalf by:

K Ware - Director

Called up

Merger

share

Retained

relief

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 August 2019

1,000

(2,016,688

)

7,223,170

5,207,482

Changes in equity

Total comprehensive income

-

(1,335,505

)

-

(1,335,505

)

Balance at 31 July 2020

1,000

(3,352,193

)

7,223,170

3,871,977

Changes in equity

Total comprehensive income

-

(812,617

)

-

(812,617

)

Balance at 31 July 2021

1,000

(4,164,810

)

7,223,170

3,059,360

Called up

Merger

share

Retained

relief

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 August 2019

1,000

1,892,561

7,223,170

9,116,731

Changes in equity

Total comprehensive income

-

294,135

-

294,135

Balance at 31 July 2020

1,000

2,186,696

7,223,170

9,410,866

Changes in equity

Total comprehensive income

-

233,710

-

233,710

Balance at 31 July 2021

1,000

2,420,406

7,223,170

9,644,576

Cash flows from operating activities

Cash generated from operations

1

(237,073

)

487,009

Interest paid

(108,650

)

(121,556

)

Tax paid

(88,220

)

(50,057

)

Net cash from operating activities

(433,943

)

315,396

Cash flows from investing activities

Purchase of intangible fixed assets

(3,166

)

(5,142

)

Purchase of tangible fixed assets

(17,161

)

(43,572

)

Sale of tangible fixed assets

15,271

12,746

Interest received

128

849

Net cash from investing activities

(4,928

)

(35,119

)

Cash flows from financing activities

New loans in year

-

250,000

Loan repayments in year

(10,417

)

-

Net cash from financing activities

(10,417

)

250,000

(Decrease)/increase in cash and cash equivalents

(449,288

)

530,277

Cash and cash equivalents at beginning of year

2

1,626,989

1,096,712

Cash and cash equivalents at end of year

2

1,177,701

1,626,989

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

2021

2020

£

£

Loss before taxation

(694,016

)

(1,375,310

)

Depreciation charges

47,173

64,910

(Profit)/loss on disposal of fixed assets

(8,289

)

6,689

Amortisation of goodwill

966,405

966,405

Finance costs

108,650

121,556

Finance income

(128

)

(849

)

419,795

(216,599

)

(Increase)/decrease in trade and other debtors

(278,149

)

1,138,919

Decrease in trade and other creditors

(378,719

)

(435,311

)

Cash generated from operations

(237,073

)

487,009

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 July 2021

31.7.21

1.8.20

£

£

Cash and cash equivalents

1,177,701

1,626,989

Year ended 31 July 2020

31.7.20

1.8.19

£

£

Cash and cash equivalents

1,626,989

1,096,712

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.8.20

Cash flow

At 31.7.21

£

£

£

Net cash

Cash at bank and in hand

1,626,989

(449,288

)

1,177,701

1,626,989

(449,288

)

1,177,701

Debt

Debts falling due within 1 year

(120,000

)

(270,000

)

(390,000

)

Debts falling due after 1 year

(2,960,000

)

510,000

(2,450,000

)

(3,080,000

)

240,000

(2,840,000

)

Total

(1,453,011

)

(209,288

)

(1,662,299

)

1.	STATUTORY INFORMATION

Dalziel & Pow Holdings 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 General Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

Basis of consolidation

The Consolidated Accounts incorporate the Accounts of Dalziel & Pow Holdings Limited and all its subsidiary undertakings. A separate Profit and Loss Account dealing with the results of the company has not been presented in accordance with section 408 of the Companies Act 2006. The acquisition method of accounting has been adopted. Under this method, the results of the subsidiary undertakings acquired or disposed of in the year are included in the consolidated profit and loss account from the date of acquisition or up to the date of the disposal.

Related party exemption

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

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Turnover

Turnover represents invoiced sales in respect of fees for services rendered and direct costs recovered as agreed with each client, excluding VAT.

Revenue is recognised when a service has been completed in accordance with the terms of agreement with the client. Where the provision of a service remains incomplete at the end of a period, a proportion of the income pertaining to the level of the service performed is accrued and is part of the debtors balance.

Where clients have invoiced in advance for services to be delivered at a future date, the income is deferred and becomes part of the creditors balance.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2017, is being amortised evenly over its estimated useful life of ten years.

Intangible assets

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

Patents and licences are being amortised evenly over their estimated useful life of five years.

Tangible fixed assets

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

Short leasehold

-

over the lease term

Fixtures and fittings

-

25% on reducing balance

Computer equipment

-

33% on reducing balance

Government grants

Grants relating to the Coronavirus Job Retention Scheme are recognised in full in the period in which the associated salary, national insurance and pension costs were incurred.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

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

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.

Foreign currencies

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

Hire purchase and leasing commitments

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

Pension costs and other post-retirement benefits

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

3.

TURNOVER

The turnover and loss before taxation are attributable to the one principal activity of the group.

An analysis of turnover by geographical market is given below:

2021

2020

£

£

United Kingdom

2,642,074

3,285,901

Europe

1,423,260

1,498,202

Rest of the World

732,635

1,985,542

4,797,969

6,769,645

4.	OTHER OPERATING INCOME

2021

2020

£

£

Sundry receipts

17,794

1,613

Rents received

-

102,886

Government grants

277,261

63,890

295,055

168,389

During the year, the company received Coronavirus Job Retention Support grants amounting to £277,261 (2020: £63,890).