Pearl Window Systems (Group) Limited Group accounts (Group and Company)

PEARL WINDOW SYSTEMS (GROUP) LIMITED - Company Information

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COMPANY REGISTRATION NUMBER: 13190370

Pearl Window Systems (Group) Limited

Financial Statements

31 December 2022

Pearl Window Systems (Group) Limited

Financial Statements

Year ended 31 December 2022

Contents	Page

Strategic report	1

Directors' report	3

Independent auditor's report to the members	5

Consolidated statement of comprehensive income	9

Consolidated statement of financial position	10

Company statement of financial position	11

Consolidated statement of changes in equity	12

Company statement of changes in equity	13

Consolidated statement of cash flows	14

Notes to the financial statements	15

Pearl Window Systems (Group) Limited

Strategic Report

Year ended 31 December 2022

The directors present their strategic report of the group for the year ended 31 December 2022.

Fair review of the business

The group has had another successful year despite problems within the market sector including unprecedented movements in supply chain pricing which has continued to be disruptive on a monthly basis. This has caused great difficulty during the year, however the directors have managed to overcome this resulting in a strong financial performance. Levels of demand for the group products remain high with substantial forward orders. Material provision times have normalised which has allowed product manufacture lead times to reduce from those in 2021. The group has continued to develop it's cloud-based system, making a huge step forward in virtual technology for the benefit of it's clients. This provides further opportunities for clients to enhance their own technology and offering to their own customers for the future. The directors intend to continue this investment in order to support their clients and allow them to have greater offering than others in the market. The directors anticipate continued increased levels of demand for the group products and in order to meet this further investment is ongoing in both the production and distribution facilities which will facilitate further sales growth and profitability.

Results

The group made a pre tax profit of £1,265,784 (2021: £1,614,337) for the year from a turnover of £19,248,467 (2021: £15,371,414). At 31 December 2022 the group had net assets of £2,483,110 (2021: £1,222,331).

Principal risks and uncertainties

The principal risks and uncertainties facing the group relate to uncertainties in the general economic climate in the UK and more specifically in the construction sector. In order to minimise the risk of the above to the group, the directors continue to invest significantly in its manufacturing facilities in order to both create and maintain high levels of efficiency in its production processes.

Key performance indicators

The delivery of the group's strategic objectives is monitored by the directors through Key Performance Indicators and the periodic review of various aspects of the group's operations. The directors consider the following Key Performance Indicators as appropriate measures for the delivery of its corporate strategy. Financial Definition Sales Revenue Growth in sales revenue and strength of the group's market position. Operating Profit The continued growth of operating profits which allow the group to continue to invest in its facilities.

This report was approved by the board of directors on 15 June 2023 and signed on behalf of the board by:

Mr.J.H. Walsh

Director

Registered office:

Alex House

260-268 Chapel Street

Salford

England

M3 5JZ

Pearl Window Systems (Group) Limited

Directors' Report

Year ended 31 December 2022

The directors present their report and the financial statements of the group for the year ended 31 December 2022 .

Principal activities

The principal activity of the company during the period was that of a holding company.

Directors

The directors who served the company during the year were as follows:

Mr.J.H. Walsh
Mr.A. Holliday
Mr.S. French

Dividends

Particulars of recommended dividends are detailed in note 13 to the financial statements.

Future developments

The group intends to make further investment in its production, storage and distribution facilities as part of its rolling capital investment programme. This will enhance the manufacturing capacity of the group and will allow it to maintain the efficient level of service provided to customers.

Financial instruments

The directors consider that the group only has limited exposure to the various aspects of financial risk and it does not enter into any non basic contracts as there is no requirement for this within its trade. The group's revenue is invoiced in sterling and all its operational costs arise within the United Kingdom.

Directors' responsibilities statement

The directors are responsible for preparing the strategic report, 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 group and the company and 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 judgments 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 of disclosure to auditor

Each of the persons who is a director at the date of approval of this report confirms that:

- so far as they are aware, there is no relevant audit information of which the group and the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the group and the company's auditor is aware of that information. The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.

This report was approved by the board of directors on 15 June 2023 and signed on behalf of the board by:

Mr.J.H. Walsh

Director

Registered office:

Alex House

260-268 Chapel Street

Salford

England

M3 5JZ

Pearl Window Systems (Group) Limited

Independent Auditor's Report to the Members of Pearl Window Systems (Group) Limited

Year ended 31 December 2022

Opinion

We have audited the financial statements of Pearl Window Systems (Group) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the consolidated statement of comprehensive income, consolidated statement of financial position, company statement of financial position, consolidated statement of changes in equity, company statement of changes in equity, consolidated statement of cash flows 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the group's and of the parent company's affairs as at 31 December 2022 and of the group's profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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 or 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 other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. 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. 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 group and the parent 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 in relation to which 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 directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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.

Auditor's 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 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. The extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit. In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit. However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team: - obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company operates in and how the company is complying with the legal and regulatory framework; - inquired of management and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud; - discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud. As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102 and the Companies Act 2006. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing financial statement disclosures. The audit engagement team identified the risk of management override of controls and revenue recognition as the areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business and testing a sample of revenue transactions recorded in the year to determine whether revenue had been recorded correctly. 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. Use of our report

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

Stuart Whitehead FCA

(Senior Statutory Auditor)

For and on behalf of

Edwards Veeder LLP

Chartered Accountants & Statutory Auditor

Alex House

260-268 Chapel Street

Salford

England

M3 5JZ

15 June 2023

Pearl Window Systems (Group) Limited

Consolidated Statement of Comprehensive Income

Year ended 31 December 2022

			Period from
		Year to	9 Feb 21 to
		31 Dec 22	31 Dec 21
Note		£	£
Turnover	4	19,248,467	15,371,414

Cost of sales	14,082,020	10,541,834
	-------------	-------------
Gross profit	5,166,447	4,829,580

Administrative expenses		3,609,460	2,937,160
Other operating income	5	–	28,172
		------------	------------
Operating profit	6	1,556,987	1,920,592

Other interest receivable and similar income	10	3,665	34
Interest payable and similar expenses	11	294,868	306,289
		------------	------------
Profit before taxation		1,265,784	1,614,337

Tax on profit	12	( 21,662)	402,006
		------------	------------
Profit for the financial year and total comprehensive income		1,287,446	1,212,331
		------------	------------

All the activities of the group are from continuing operations.

Pearl Window Systems (Group) Limited

Consolidated Statement of Financial Position

31 December 2022

	2022	2021
Note	£	£

Fixed assets

Intangible assets	14	5,980,187	6,309,372
Tangible assets	15	1,369,623	1,543,036
		------------	------------
		7,349,810	7,852,408

Current assets

Stocks	17	780,865	784,272
Debtors	18	1,462,329	1,998,524
Cash at bank and in hand		1,759,199	627,203
		------------	------------
		4,002,393	3,409,999

Creditors: amounts falling due within one year	20	3,531,576	3,900,362
		------------	------------
Net current assets/(liabilities)		470,817	( 490,363)
		------------	------------
Total assets less current liabilities		7,820,627	7,362,045

Creditors: amounts falling due after more than one year	21	5,106,742	5,965,419

Provisions	23	230,775	174,295
		------------	------------
Net assets		2,483,110	1,222,331
		------------	------------

Capital and reserves

Called up share capital	27	10,000	10,000
Profit and loss account	28	2,473,110	1,212,331
		------------	------------
Shareholders funds		2,483,110	1,222,331
		------------	------------

These financial statements were approved by the board of directors and authorised for issue on 15 June 2023 , and are signed on behalf of the board by:

Mr.J.H. Walsh	Mr.A. Holliday
Director	Director

Mr.S. French
Director

Company registration number: 13190370

Pearl Window Systems (Group) Limited

Company Statement of Financial Position

31 December 2022

	2022	2021
Note	£	£

Fixed assets

Investments	16	9,150,000	9,150,000

Current assets

Debtors	18	4,191	–
Cash at bank and in hand		111,305	96,747
		---------	--------
		115,496	96,747

Creditors: amounts falling due within one year	20	4,680,393	4,654,034
		------------	------------
Net current liabilities		4,564,897	4,557,287
		------------	------------
Total assets less current liabilities		4,585,103	4,592,713

Creditors: amounts falling due after more than one year	21	4,747,500	4,747,500
		------------	------------
Net liabilities		( 162,397)	( 154,787)
		------------	------------

Capital and reserves

Called up share capital	27	10,000	10,000
Profit and loss account	28	( 172,397)	( 164,787)
		---------	---------
Shareholders deficit		( 162,397)	( 154,787)
		---------	---------

The profit for the financial year of the parent company was £ 19,057 (2021: £ 164,787 loss).

These financial statements were approved by the board of directors and authorised for issue on 15 June 2023 , and are signed on behalf of the board by:

Mr.J.H. Walsh	Mr.A. Holliday
Director	Director

Mr.S. French
Director

Company registration number: 13190370

Pearl Window Systems (Group) Limited

Consolidated Statement of Changes in Equity

Year ended 31 December 2022

		Called up share capital	Profit and loss account	Total
		£	£	£
At 9 February 2021		–	–	–

Profit for the year			1,212,331	1,212,331
		----	------------	------------
Total comprehensive income for the year		–	1,212,331	1,212,331

Issue of shares		10,000	–	10,000
		--------	------------	------------
Total investments by and distributions to owners		10,000	–	10,000

At 31 December 2021		10,000	1,212,331	1,222,331

Profit for the year			1,287,446	1,287,446
		--------	------------	------------
Total comprehensive income for the year		–	1,287,446	1,287,446

Dividends paid and payable	13	–	( 26,667)	( 26,667)
		----	--------	--------
Total investments by and distributions to owners		–	( 26,667)	( 26,667)

		--------	------------	------------
At 31 December 2022		10,000	2,473,110	2,483,110
		--------	------------	------------

Pearl Window Systems (Group) Limited

Company Statement of Changes in Equity

Year ended 31 December 2022

		Called up share capital	Profit and loss account	Total
		£	£	£
At 9 February 2021		–	–	–

Loss for the year			( 164,787)	( 164,787)
		----	---------	---------
Total comprehensive income for the year		–	( 164,787)	( 164,787)

Issue of shares		10,000	–	10,000
		--------	---------	---------
Total investments by and distributions to owners		10,000	–	10,000

At 31 December 2021		10,000	( 164,787)	( 154,787)

Profit for the year			19,057	19,057
		--------	---------	---------
Total comprehensive income for the year		–	19,057	19,057

Dividends paid and payable	13	–	( 26,667)	( 26,667)
		----	--------	--------
Total investments by and distributions to owners		–	( 26,667)	( 26,667)

		--------	---------	---------
At 31 December 2022		10,000	( 172,397)	( 162,397)
		--------	---------	---------

Pearl Window Systems (Group) Limited

Consolidated Statement of Cash Flows

Year ended 31 December 2022

	2022	2021
Note	£	£

Cash flows from operating activities

Profit for the financial year	1,287,446	1,212,331

Adjustments for:
Depreciation of tangible assets	234,430	215,299
Amortisation of intangible assets	329,185	274,320
Government grant income	–	( 28,172)
Other interest receivable and similar income	( 3,665)	( 34)
Interest payable and similar expenses	294,868	306,289
Loss on disposal of tangible assets	7,404	665
Tax on profit	( 21,662)	402,006
Accrued expenses	17,335	140,461

Changes in:
Stocks	3,408	( 784,272)
Trade and other debtors	536,195	( 1,998,524)
Trade and other creditors	35,294	4,720,209
	------------	------------
Cash generated from operations	2,720,238	4,460,578

Interest paid	( 294,868)	( 306,289)
Interest received	3,665	34
Tax paid	( 101,035)	( 78,942)
	------------	------------
Net cash from operating activities	2,328,000	4,075,381
	------------	------------

Cash flows from investing activities

Purchase of tangible assets	( 70,123)	( 1,795,583)
Proceeds from sale of tangible assets	1,701	36,583
Purchase of intangible assets	–	( 6,583,692)
	------------	------------
Net cash used in investing activities	( 68,422)	( 8,342,692)
	------------	------------

Cash flows from financing activities

Proceeds from issue of ordinary shares	–	10,000
Proceeds from borrowings	( 767,164)	4,054,680
Government grant income	–	28,172
Payments of finance lease liabilities	( 189,507)	656,873
Dividends paid	( 26,667)	–
	------------	------------
Net cash (used in)/from financing activities	( 983,338)	4,749,725
	------------	------------

Net increase in cash and cash equivalents		1,276,240	482,414
Cash and cash equivalents at beginning of year		482,414	–
		------------	---------
Cash and cash equivalents at end of year	19	1,758,654	482,414
		------------	---------

Pearl Window Systems (Group) Limited

Notes to the Financial Statements

Year ended 31 December 2022

1. General information

The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Alex House, 260-268 Chapel Street, Salford, England, M3 5JZ (Company registration number: 13190370 ).

2. Statement of compliance

These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006.

3. Accounting policies

Basis of preparation

The financial statements have been prepared on the historical cost basis. The financial statements are prepared in sterling, which is the functional currency of the group.

Disclosure exemptions

The parent company satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following reduced disclosures available under FRS 102:

(a) Disclosures in respect of each class of share capital have not been presented.

(b) No cash flow statement has been presented for the company.

(d) No disclosure has been given for the aggregate remuneration of key management personnel.

Consolidation

The financial statements consolidate the financial statements of Pearl Window Systems (Group) Limited and all of its subsidiary undertakings.

The results of subsidiaries acquired or disposed of during the year are included from or to the date that control passes.

The parent company has applied the exemption contained in section 408 of the Companies Act 2006 and has not presented its individual profit and loss account.

Judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Key sources of estimation uncertainty Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows: Useful life of fixed assets In making decisions regarding the depreciation of non current assets, management must estimate the useful life of said assets to the business. A change in estimate would result in a change in the depreciation charged to profit and loss in each year. The carrying amount of depreciation at the end of 31st December 2022 is £420,176 (2021: £195,729).

Revenue recognition

Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.

Taxation

The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.

Operating leases

Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.

Goodwill

Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight-line basis over its useful life

Amortisation

Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:

	Goodwill	-	5% straight line

If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.

Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.

Depreciation

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

Plant and Machinery	-	15% reducing balance
Fixtures and Office Equipment	-	15% reducing balance
Commercial Vehicles	-	15% reducing balance
Motor Vehicles	-	15% reducing balance

Investments

Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.

Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.

Stocks

Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.

Finance leases and hire purchase contracts

Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.

Government grants

Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis 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 and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.

Provisions

Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.

Financial instruments

A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest on the assets of the company after deducting all of its liabilities. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund.

4. Turnover

Turnover arises from:

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Sale of goods	19,248,467	15,371,414
	-------------	-------------

The whole of the turnover is attributable to the principal activity of the group wholly undertaken in the United Kingdom.

5. Other operating income

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Government grant income	–	28,172
	----	--------

6. Operating profit

Operating profit or loss is stated after charging:

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Amortisation of intangible assets	329,185	274,320
Depreciation of tangible assets	234,431	215,299
Loss on disposal of tangible assets	7,404	665
Impairment of trade debtors	167,771	455
Operating lease rentals	195,750	195,750
	---------	---------

7. Auditor's remuneration

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Fees payable for the audit of the financial statements	53,595	50,950
	--------	--------

8. Staff costs

The average number of persons employed by the group during the year, including the directors, amounted to:

	2022	2021
	No.	No.
Production staff	127	129
Administrative staff	23	25
Management staff	3	3
	----	----
	153	157
	----	----

The aggregate payroll costs incurred during the year, relating to the above, were:

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Wages and salaries	3,730,080	2,941,537
Social security costs	332,894	291,625
Other pension costs	65,568	51,527
	------------	------------
	4,128,542	3,284,689
	------------	------------

9. Directors' remuneration

The directors' aggregate remuneration in respect of qualifying services was:

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Remuneration	421,137	329,277
Company contributions to defined contribution pension plans	3,963	3,847
	---------	---------
	425,100	333,124
	---------	---------

The number of directors who accrued benefits under company pension plans was as follows:

	2022	2021
	No.	No.
Defined contribution plans	3	3
	----	----

Remuneration of the highest paid director in respect of qualifying services:

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Aggregate remuneration	165,262	141,350
	---------	---------

10. Other interest receivable and similar income

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Interest on cash and cash equivalents	3,665	34
	-------	----

11. Interest payable and similar expenses

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Interest on banks loans and overdrafts	83,066	117,737
Interest on obligations under finance leases and hire purchase contracts	32,006	38,722
Other interest payable and similar charges	179,796	149,830
	---------	---------
	294,868	306,289
	---------	---------

12. Tax on profit

Major components of tax expense

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£

Current tax:

UK current tax expense	299,405	357,108
Adjustments in respect of prior periods	( 377,546)	–
	---------	---------
Total current tax	( 78,141)	357,108
	---------	---------

Deferred tax:

Origination and reversal of timing differences	56,479	44,898
	--------	---------
Tax on profit	( 21,662)	402,006
	--------	---------

Reconciliation of tax (income)/expense

The tax assessed on the profit on ordinary activities for the year is lower than (2021: higher than) the standard rate of corporation tax in the UK of 19 % (2021: 19 %).

		Period from
	Year to	9 Feb 21 to
	31 Dec 22	31 Dec 21
	£	£
Profit on ordinary activities before taxation	1,265,784	1,614,337
	------------	------------
Profit on ordinary activities by rate of tax	303,044	368,857
Adjustment to tax charge in respect of prior periods	( 377,546)	–
Effect of expenses not deductible for tax purposes	1,379	34,833
Effect of capital allowances and depreciation	12,377	( 63,976)
Utilisation of tax losses	( 17,395)	–
Unused tax losses	–	17,395
Other tax adjustment to increase/(decrease) tax liability	56,479	44,897
	------------	------------
Tax on profit/(loss)	( 21,662)	402,006
	------------	------------

13. Dividends

	2022	2021
	£	£
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year )	26,667	–
	--------	----

14. Intangible assets

Group	Goodwill
	£
Cost
At 1 January 2022 and 31 December 2022	6,583,692
	------------
Amortisation
At 1 January 2022	274,320
Charge for the year	329,185
	------------
At 31 December 2022	603,505
	------------
Carrying amount
At 31 December 2022	5,980,187
	------------
At 31 December 2021	6,309,372
	------------

The company has no intangible assets.

15. Tangible assets

Group	Plant and Machinery	Fixtures and Fittings	Commercial Vehicles	Motor Vehicles	Total
	£	£	£	£	£
Cost
At 1 January 2022	1,278,825	104,186	225,559	130,195	1,738,765
Additions	39,992	3,181	26,950	–	70,123
Disposals	–	–	( 19,089)	–	( 19,089)
	------------	---------	---------	---------	------------
At 31 December 2022	1,318,817	107,367	233,420	130,195	1,789,799
	------------	---------	---------	---------	------------
Depreciation
At 1 January 2022	154,315	12,691	20,943	7,780	195,729
Charge for the year	170,740	14,010	31,318	18,363	234,431
Disposals	–	–	( 9,984)	–	( 9,984)
	------------	---------	---------	---------	------------
At 31 December 2022	325,055	26,701	42,277	26,143	420,176
	------------	---------	---------	---------	------------
Carrying amount
At 31 December 2022	993,762	80,666	191,143	104,052	1,369,623
	------------	---------	---------	---------	------------
At 31 December 2021	1,124,510	91,495	204,616	122,415	1,543,036
	------------	---------	---------	---------	------------

The company has no tangible assets.

Finance leases and hire purchase contracts

Included within the carrying value of tangible assets are the following amounts relating to assets held under finance leases or hire purchase agreements:

Group	Plant and Machinery	Fixtures and Fittings	Commercial Vehicles	Motor Vehicles	Total
	£	£	£	£	£
At 31 December 2022	409,289	20,701	122,148	104,052	656,190
	---------	--------	---------	---------	---------
At 31 December 2021	403,282	8,391	105,065	27,106	543,844
	---------	--------	---------	---------	---------

16. Investments

The group has no investments.

Company	Shares in group companies
	£
Cost
At 1 January 2022 and 31 December 2022	9,150,000
	------------
Impairment
At 1 January 2022 and 31 December 2022	–
	------------

Carrying amount
At 1 January 2022 and 31 December 2022	9,150,000
	------------
At 31 December 2021	9,150,000
	------------

Subsidiaries, associates and other investments

Details of the investments in which the parent company has an interest of 20% or more are as follows:

	Class of share	Percentage of shares held
Subsidiary undertakings
Pearl Window Systems Limited	Ordinary	100

Pearl Glazing Systems Limited	Ordinary	100
Pearl Window Systems (UK) Limited	Ordinary	100

Each subsidiary undertaking is registered at Alex House 260-268 Chapel Street, Salford, England, M3 5JZ.

17. Stocks

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Raw materials and consumables	644,759	574,543	–	–
Work in progress	136,106	209,729	–	–
	---------	---------	----	----
	780,865	784,272	–	–
	---------	---------	----	----

18. Debtors

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Trade debtors	1,186,216	1,705,400	–	–
Prepayments and accrued income	271,922	293,124	–	–
Other debtors	4,191	–	4,191	–
	------------	------------	-------	----
	1,462,329	1,998,524	4,191	–
	------------	------------	-------	----

19. Cash and cash equivalents

Cash and cash equivalents comprise the following:

	2022	2021
	£	£
Cash at bank and in hand	1,759,199	627,203
Bank overdrafts	( 545)	( 144,789)
	------------	---------
	1,758,654	482,414
	------------	---------

20. Creditors: amounts falling due within one year

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Bank loans and overdrafts	667,212	911,456	–	–
Trade creditors	1,928,256	1,814,135	–	–
Amounts owed to group undertakings	–	–	4,613,998	4,575,344
Accruals and deferred income	157,796	140,461	7,650	7,500
Corporation tax	98,990	278,166	4,470	982
Social security and other taxes	429,374	499,211	29,969	36,912
Obligations under finance leases and hire purchase contracts	225,642	223,637	–	–
Director loan accounts	3,330	3,330	3,330	3,330
Other creditors	20,976	29,966	20,976	29,966
	------------	------------	------------	------------
	3,531,576	3,900,362	4,680,393	4,654,034
	------------	------------	------------	------------

The bank borrowings are secured by a charge on all the assets of Pearl Window Systems Limited dated 26 February 2021. In addition, inter-company guarantees have been provided by the group companies Pearl Window Systems (Group) Limited , Pearl Window Systems (UK) Limited and Pearl Glazing Systems Limited.

The outstanding balance on hire purchase contracts is secured on the assets subject to the hire purchase finance.

The aggregate amount of creditors due within one year for which security was given amounted to £892,854 (2021: £1,135,093).

21. Creditors: amounts falling due after more than one year

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Bank loans and overdrafts	117,518	784,683	–	–
Obligations under finance leases and hire purchase contracts	241,724	433,236	–	–
Director loan accounts	2,500,000	2,500,000	2,500,000	2,500,000
Other creditors	2,247,500	2,247,500	2,247,500	2,247,500
	------------	------------	------------	------------
	5,106,742	5,965,419	4,747,500	4,747,500
	------------	------------	------------	------------

The outstanding balance on hire purchase contracts is secured on the assets subject to the hire purchase finance.

The aggregate amount of creditors due after more than one year for which security was given amounted to £359,242 (2021: £1,217,919).

22. Finance leases and hire purchase contracts

The total future minimum lease payments under finance leases and hire purchase contracts are as follows:

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Not later than 1 year	241,530	253,874	–	–
Later than 1 year and not later than 5 years	253,754	461,875	–	–
	---------	---------	----	----
	495,284	715,749	–	–
Less: future finance charges	( 27,918)	( 58,876)	–	–
	---------	---------	----	----
Present value of minimum lease payments	467,366	656,873	–	–
	---------	---------	----	----

23. Provisions

Group	Deferred tax (note 24)
	£
At 1 January 2022	174,295
Additions	56,480
	---------
At 31 December 2022	230,775
	---------

The company does not have any provisions.

24. Deferred tax

The deferred tax included in the statement of financial position is as follows:

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Included in provisions (note 23)	230,775	174,295	–	–
	---------	---------	----	----

The deferred tax account consists of the tax effect of timing differences in respect of:

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Accelerated capital allowances	230,775	174,295	–	–
	---------	---------	----	----

25. Employee benefits

Defined contribution plans

The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 61,605 (2021: £ 47,680 ).

26. Government grants

The amounts recognised in the financial statements for government grants are as follows:

Group		Company
2022	2021	2022	2021
£	£	£	£

Recognised in other operating income:

Government grants recognised directly in income	–	28,172	–	–
	----	--------	----	----

27. Called up share capital

Issued, called up and fully paid

	2022		2021
	No.	£	No.	£
A Ordinary shares of £ 1 each	2,500	2,500	2,500	2,500
B Ordinary shares of £ 1 each	7,500	7,500	7,500	7,500
	--------	--------	--------	--------
	10,000	10,000	10,000	10,000
	--------	--------	--------	--------

A Ordinary shares and B Ordinary shares carry no right to fixed income.

28. Reserves

Profit and loss account - This reserve records retained earnings and accumulated losses.

29. Analysis of changes in net debt

	At 1 Jan 2022	Cash flows	At 31 Dec 2022
	£	£	£
Cash at bank and in hand	627,203	1,131,996	1,759,199
Bank overdrafts	(144,789)	144,244	(545)
Debt due within one year	(993,634)	97,995	(895,639)
Debt due after one year	(3,717,919)	858,677	(2,859,242)
	------------	------------	------------
	( 4,229,139)	2,232,912	( 1,996,227)
	------------	------------	------------

30. Operating leases

The total future minimum lease payments under non-cancellable operating leases are as follows:

	Group		Company
	2022	2021	2022	2021
	£	£	£	£
Not later than 1 year	13,982	195,750	–	–
Later than 1 year and not later than 5 years	–	13,982	–	–
	--------	---------	----	----
	13,982	209,732	–	–
	--------	---------	----	----

31. Contingencies

Pearl Window Systems (Group) Limited and its group companies Pearl Window Systems Limited, Pearl Glazing Systems Limited and Pearl Window Systems (UK) Limited, are subject to an inter-company guarantee in favour of the funders of Pearl Window Systems Limited. At 31 December 2022 the company had a contingent liability under this agreement amounting to £784,730 (2021: £1,596,136).

32. Related party transactions

Company

At 31 December 2022 the group owed £2,500,000 (2021: £2,500,000) to a director Mr.J.H. Walsh , £1,665(2021: £1,665) to a director Mr.A. Holliday and £1,665 (2021: £1,665) to a director Mr.S. French . No interest has been charged to the group in respect of the balances which are repayable on demand and are classified under creditors.