WSP Solicitors Limited - Period Ending 2022-06-30

WSP Solicitors Limited

Contents

Company Information	1
Balance Sheet	2
Notes to the Unaudited Financial Statements	3 to 10

WSP Solicitors Limited

Company Information

Directors

J B Bonham B L E Evans C J Green P R Mardon D J Pallant A D M Wallace-Cook K L Carr A L Leivers L A F McCallum C Cephas S M Miller R M Selwood

Company secretary

P R Mardon

Registered office

3-7 Rowcroft Stroud GL5 3BJ

Accountants

Hazlewoods LLP Windsor House Bayshill Road Cheltenham GL50 3AT

WSP Solicitors Limited

(Registration number: 07333390)
Balance Sheet as at 30 June 2022

	Note	2022 £	2021 £
Fixed assets
Intangible assets	4	525,000	600,000
Tangible assets	5	48,932	62,279
Investments	6	2,000	2,000
		575,932	664,279
Current assets
Debtors	7	1,296,139	1,369,944
Cash at bank and in hand		144,157	193,728
		1,440,296	1,563,672
Creditors: Amounts falling due within one year	8	(934,893)	(981,174)
Net current assets		505,403	582,498
Total assets less current liabilities		1,081,335	1,246,777
Creditors: Amounts falling due after more than one year	8	(303,824)	(600,000)
Provisions		(92,000)	(90,000)
Deferred tax liabilities		(4,005)	(9,098)
Net assets		681,506	547,679
Capital and reserves
Called up share capital		100	100
Profit and loss account		681,406	547,579
Shareholders' funds		681,506	547,679

For the financial year ending 30 June 2022 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Directors' responsibilities:

•	The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476; and
•	The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime and the option not to file the Profit and Loss Account has been taken.

Approved and authorised by the Board on 17 February 2023 and signed on its behalf by:
 

P R Mardon
Company secretary and director

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
3-7 Rowcroft
Stroud
GL5 3BJ

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A smaller entities - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' and the Companies Act 2006 (as applicable to companies subject to the small companies' regime).

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
 

Judgements

In the application of the company's accounting policies, management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

Key sources of estimation uncertainty

Bad debt provision - due to the nature of the business, there are high levels of trade debtors at the year end, and therefore a risk that some of these balances may not be recoverable. A bad debt review is carried out, where debts are assessed and provided against when the recoverability of these balances is considered to be uncertain. The carrying amount is £82,678 (2021 -£81,633).

Amounts recoverable on contracts - The process of assessing amounts recoverable on contracts requires various estimates and judgements to be made. Fee earners are required to record time spent on client assignments and this is the basis for the amounts recoverable on contracts estimate. The carrying amount is £709,059 (2021 -£714,708).

Provision for client claims - the provision is based on a review of potential claims and an assessment of any potential settlements that are considered likely as a result of these. The carrying amount is £47,000 (2021 -£45,000).

Dilapidations - a provision for dilapidations on the company's property leases is being built up each year based on the amount expected to be payable at the cessation of the leases. The carrying amount is £45,000 (2021 -£45,000).

Revenue recognition

Fees receivable represent the fair value of services provided during the year on client assignments. Fair value reflects the amounts expected to be recoverable from clients based on time spent, skills provided and expenses incurred, and excludes VAT. Income is recognised as contract activity progresses and the right to consideration is secured, except where the final outcome cannot be assessed with reasonable certainty.

Income in respect of contingent fee assignments is recognised in the period when the contingent event occurs and collectability of the fee is assured.

Unbilled income on individual client assignments is included as amounts recoverable on contracts within debtors.

Disbursements
Disbursements are not included in income or expenses, but are netted off against each other.

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating either to revenue or to assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Deferred tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements and on unused tax losses or tax credits in the company. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Goodwill

Positive goodwill is capitalised, classified as an asset on the balance sheet and amortised on a straight line basis over its useful economic life. It is reviewed for impairment at the end of the first full financial year following the acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class	Amortisation method and rate
Goodwill	Over 10 years

Tangible assets

Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class	Depreciation method and rate
Leasehold improvements	15% of cost per annum
Fixtures and fittings	15% of cost per annum
Office equipment	25% of cost per annum

Investments

Fixed asset investments are stated at historical cost less provision for any diminution in value.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Provisions

Provisions are recognised when the company has an obligation at the reporting date as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

Financial instruments

Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

3

Staff numbers

The average number of persons employed by the company (including directors) during the year, was 70 (2021 - 87).

4

Intangible assets

	Goodwill  £
Cost
At 1 July 2021	750,000
At 30 June 2022	750,000
Amortisation
At 1 July 2021	150,000
Amortisation charge	75,000
At 30 June 2022	225,000
Carrying amount
At 30 June 2022	525,000
At 30 June 2021	600,000

5

Tangible assets

	Leasehold improvements £	Fixtures and fittings  £	Office equipment  £	Total £
Cost
At 1 July 2021	8,871	25,784	129,899	164,554
Additions	988	3,769	8,925	13,682
At 30 June 2022	9,859	29,553	138,824	178,236
Depreciation
At 1 July 2021	2,195	10,196	89,884	102,275
Charge for the year	1,765	4,384	20,880	27,029
At 30 June 2022	3,960	14,580	110,764	129,304
Carrying amount
At 30 June 2022	5,899	14,973	28,060	48,932
At 30 June 2021	6,676	15,588	40,015	62,279

6

Investments

	2022 £	2021 £
Other investments	2,000	2,000

Other investments	£
Cost
As at 1 July 2021 and 30 June 2022	2,000
Carrying amount
At 30 June 2022	2,000
At 30 June 2021	2,000

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

This represents the company's non controlling shareholding in AEO Trading Ltd.

7

Debtors

	2022  £	2021  £
Trade debtors	254,247	384,702
Amounts recoverable on contracts	709,059	714,708
Prepayments	332,833	270,534
	1,296,139	1,369,944

8

Creditors

	Note	2022  £	2021  £
Loans and borrowings	11	478,495	336,622
Trade creditors		59,337	29,314
Social security and other taxes		203,017	312,686
Other creditors		18,844	134,369
Accrued expenses		117,061	81,701
Corporation tax liability		58,139	86,482
		934,893	981,174
Due after one year
Loans and borrowings	11	303,824	600,000

Creditors: Amounts falling due within one year includes a bank overdraft, on which security has been given by the company. The bank overdraft is secured by a fixed and floating charge over the company's assets, dated 21 June 2019.

9

Provisions

	Client claims £	Dilapidations £	Total £
At 1 July 2021	45,000	45,000	90,000
Increase in existing provisions	2,000	-	2,000
At 30 June 2022	47,000	45,000	92,000

WSP Solicitors Limited

Notes to the Unaudited Financial Statements for the Year Ended 30 June 2022

10

Deferred tax

Deferred tax assets and liabilities

2022	Asset £	Liability £
Fixed asset timing differences	-	4,881
Short term timing differences	876	-
	876	4,881

2021	Asset £	Liability £
Fixed asset timing differences	-	10,209
Short term timing differences	1,111	-
	1,111	10,209

11

Loans and borrowings

	2022 £	2021 £
Current loans and borrowings
Bank borrowings	-	150,000
Bank overdrafts	263,118	-
Other borrowings	215,377	186,622
	478,495	336,622

	2022 £	2021 £
Non-current loans and borrowings
Other borrowings	303,824	600,000

12

Financial commitments, guarantees and contingencies

Amounts not provided for in the balance sheet

The total amount of financial commitments not included in the balance sheet is £159,085 (2021 - £160,982).