Red Europe Limited - Limited company accounts 23.1

REGISTERED NUMBER: 06681654 (England and Wales)

RED EUROPE LIMITED

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST DECEMBER 2022

Page

Company information

1

Report of the directors

2

to

3

Report of the independent auditors

4

to

7

Statement of comprehensive income

8

Statement of financial position

9

to

10

Statement of changes in equity

11

Notes to the financial statements

12

to

20

Directors:

J H Jannard

G L Weeks

C G Weeks

D G Webb

Registered office:

Richmond House

Walkern Road

Stevenage

Hertfordshire

SG1 3QP

Registered number:

06681654 (England and Wales)

Auditors:

Menzies LLP

Chartered Accountants and Statutory Auditors

Richmond House

Walkern Road

Stevenage

Hertfordshire

SG1 3QP

The directors present their report with the financial statements of the company for the year ended 31st December 2022.

Directors

The directors shown below have held office during the whole of the period from 1st January 2022 to the date of this report.

J H Jannard

G L Weeks

C G Weeks

Other changes in directors holding office are as follows:

D G Webb - appointed 5th April 2022

A Piper ceased to be a director after 31st December 2022 but prior to the date of this report.

Statement of directors' responsibilities

The directors are responsible for preparing 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), including Financial Reporting Standard 101 'Reduced Disclosure Framework'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement as to disclosure of information to auditors

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

Auditors

The auditors, Menzies LLP, are deemed to be reappointed in accordance with Section 487(2) of the Companies Act 2006.

This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small companies.

On behalf of the board:

D G Webb - Director

25th June 2023

Opinion

We have audited the financial statements of Red Europe Limited (the 'company') for the year ended 31st December 2022 which comprise the Income statement, Statement of financial position, Statement of changes in equity and 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 101 'Reduced Disclosure Framework' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31st December 2022 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

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

-	the Report of the directors has been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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, or returns adequate for our audit have not been received from branches not visited by us; or

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

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

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

-	the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption from the requirement to prepare a Strategic report or in preparing the Report of the directors.

Responsibilities of directors

As explained more fully in the Statement of directors' responsibilities set out on page two, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

- We obtained an understanding of the legal and regulatory framework applicable to the company and the sector in which they operate. We determined that the following laws and regulations were most significant: the Companies Act 2006 and UK corporate taxation laws.

- We obtained an understanding of how the company is complying with those legal and regulatory frameworks by making inquiries to the management. We corroborated our inquiries through our review of board minutes and papers provided by those 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 include:

- identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;

- understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;

- challenging assumptions and judgments made by management in its significant accounting estimates;

- identifying and testing journal entries, in particular any journal entries posted with unusual account combinations; and

- assessing the extent of compliance with the relevant laws and regulations.

- We have reviewed the financial statements and considered whether they are consistent with our understanding of the entity or indicate a previously unrecognised risk of material misstatement that could be due to fraud.

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.

N D Savjani FCA (Senior Statutory Auditor)

for and on behalf of Menzies LLP

Chartered Accountants and Statutory Auditors

Richmond House

Walkern Road

Stevenage

Hertfordshire

SG1 3QP

25th June 2023

REVENUE

2,396,534

2,075,624

Cost of sales

(56,117

)

(68,848

)

GROSS PROFIT

2,340,417

2,006,776

Administrative expenses

(2,213,003

)

(1,920,121

)

127,414

86,655

Other operating income

6,212

8,389

OPERATING PROFIT

133,626

95,044

Interest receivable and similar income

75

16

PROFIT BEFORE TAXATION

5

133,701

95,060

Tax on profit

6

(41,254

)

(15,222

)

PROFIT FOR THE FINANCIAL YEAR

92,447

79,838

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

92,447

79,838

FIXED ASSETS

Owned

Property, plant and equipment

7

317,834

272,788

Right-of-use

Property, plant and equipment

7, 12

255,837

-

573,671

272,788

CURRENT ASSETS

Debtors

8

1,074,087

704,793

Cash at bank and in hand

154,533

599,538

1,228,620

1,304,331

CREDITORS

Amounts falling due within one year

9

(204,445

)

(241,451

)

NET CURRENT ASSETS

1,024,175

1,062,880

TOTAL ASSETS LESS CURRENT LIABILITIES

1,597,846

1,335,668

CREDITORS

Amounts falling due after more than one year

10

(146,992

)

-

PROVISIONS FOR LIABILITIES

13

(66,022

)

(43,283

)

NET ASSETS

1,384,832

1,292,385

CAPITAL AND RESERVES

Called up share capital

14

250,000

250,000

Retained earnings

15

1,134,832

1,042,385

SHAREHOLDERS' FUNDS

1,384,832

1,292,385

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 25th June 2023 and were signed on its behalf by:

D G Webb - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1st January 2021

250,000

962,547

1,212,547

Changes in equity

Total comprehensive income

-

79,838

79,838

Balance at 31st December 2021

250,000

1,042,385

1,292,385

Changes in equity

Total comprehensive income

-

92,447

92,447

Balance at 31st December 2022

250,000

1,134,832

1,384,832

1.	STATUTORY INFORMATION

Red Europe Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparation

These financial statements have been prepared in accordance with Financial Reporting Standard 101 "Reduced Disclosure Framework" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 101 "Reduced Disclosure Framework":

•

the requirements of paragraph 52 the second sentence of paragraph 89, and paragraphs 90, 91 and 93 of IFRS 16 Leases;

the requirements of paragraph 58 of IFRS 16;

•

the requirement in paragraph 38 of IAS 1 Presentation of Financial Statements to present comparative information in respect of:

-

paragraph 79(a)(iv) of IAS 1; and

-

paragraph 73(e) of IAS 16 Property, Plant and Equipment;

•

the requirements of paragraphs 10(d), 10)(f), 16, 38A, 38B, 38C, 38D, 40A, 40B, 40C, 40D and 111 of IAS 1 Presentation of Financial Statements;

•

the requirements of paragraphs 134 to 136 of IAS 1 Presentation of Financial Statements;

•

the requirements of IAS 7 Statement of Cash Flows;

•

the requirements of paragraphs 17 and 18A of IAS 24 Related Party Disclosures;

•

the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group.

Significant judgements and estimates

In application of the company's accounting policies, which are described below, management is required to make judgements, estimates and assumptions about the carrying value of assets and liabilities that are no 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 form 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.

Significant judgements and estimates (continued)

The key sources of estimation uncertainty that have significant effects on the amounts recognised in the financial statements are described below:

Useful economic life of tangible fixed assets

The annual depreciation charge for tangible fixed assets is sensitive to changes in the estimated useful lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and physical condition of the assets.

Revenue

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

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Short leasehold

-

over the life of the lease

Improvements to property

-

25% on cost

Fixtures and fittings

-

20% on cost

Computer equipment

-

33% on cost

Taxation

Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules, using tax rates enacted or substantially enacted by the statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all material timing differences that have originated but not reversed at the statement of financial position 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 differences.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position 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.

Leases

Leases are recognised as finance leases. The lease liability is initially recognised at the present value of the lease payments which have not yet been made and subsequently measured under the amortised cost method. The initial cost of the right-of-use asset comprises the amount of the initial measurement of the lease liability, lease payments made prior to the lease commencement date, initial direct costs and the estimated costs of removing or dismantling the underlying asset per the conditions of the contract.

Where ownership of the right-of-use asset transfers to the lessee at the end of the lease term, the right-of-use asset is depreciated over the asset’s remaining useful life. If ownership of the right-of-use asset does not transfer to the lessee at the end of the lease term, depreciation is charged over the shorter of the useful life of the right-of-use asset and the lease term.

Employee benefit costs

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to the income statement in the period to which they relate.

3.	EMPLOYEES AND DIRECTORS

2022

2021

£

£

Wages and salaries

1,023,053

1,143,904

Social security costs

123,539

104,417

Other pension costs

21,581

19,490

1,168,173

1,267,811

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

2022

2021

Employees

9

9

Director

2

1

11

10

4.	DIRECTORS' EMOLUMENTS

2022

2021

£

£

Directors' remuneration

240,828

174,250

Directors' pension contributions to money purchase schemes

7,212

5,228

Information regarding the highest paid director for the year ended 31st December 2022 is as follows:

2022

£

Emoluments etc

179,478

Pension contributions to money purchase schemes

5,371

5.	PROFIT BEFORE TAXATION

The profit before taxation is stated after charging/(crediting):

2022

2021

£

£

Cost of inventories recognised as expense

56,117

68,848

Depreciation - owned assets

151,639

163,595

Depreciation - assets on hire purchase contracts or finance leases

107,661

-

Profit on disposal of fixed assets

(2,603

)

-

Auditors' remuneration

6,280

6,280

6.

TAXATION

Analysis of tax expense

2022

2021

£

£

Current tax:

Tax

18,515

35,143

Deferred tax

22,739

(19,921

)

Total tax expense in statement of comprehensive income

41,254

15,222

Factors affecting the tax expense

The tax assessed for the year is higher (2021 - lower) than the standard rate of corporation tax in the UK. The difference is explained below:

2022

2021

£

£

Profit before income tax

133,701

95,060

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2021 - 19%)

25,403

18,061

Effects of:

Depreciation in excess of capital allowances

(10,637

)

16,979

Expenses not deductible for tax purposes

3,749

103

Deferred tax

22,739

(19,921

)

Tax expense

41,254

15,222

7.	PROPERTY, PLANT AND EQUIPMENT

Improvements

Fixtures

Short

to

and

Computer

leasehold

property

fittings

equipment

Totals

£

£

£

£

£

Cost

At 1st January 2022

-

307,774

1,047,211

73,658

1,428,643

Additions

363,498

-

208,038

9,463

580,999

Disposals

-

-

(182,737

)

(44,441

)

(227,178

)

At 31st December 2022

363,498

307,774

1,072,512

38,680

1,782,464

Depreciation

At 1st January 2022

-

121,175

968,113

66,567

1,155,855

Charge for year

107,661

76,943

68,886

5,810

259,300

Eliminated on disposal

-

-

(161,921

)

(44,441

)

(206,362

)

At 31st December 2022

107,661

198,118

875,078

27,936

1,208,793

Net book value

At 31st December 2022

255,837

109,656

197,434

10,744

573,671

At 31st December 2021

-

186,599

79,098

7,091

272,788

8.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2022

2021

£

£

Trade debtors

-

4,087

Amounts owed by group undertakings

835,730

484,723

Other debtors

238,357

215,983

1,074,087

704,793

9.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2022

2021

£

£

Leases (see note 11)

108,845

-

Trade creditors

1,316

5,910

Tax

18,515

35,143

Social security and other taxes

35,286

31,749

Other creditors

30,793

72,634

Accrued expenses

9,690

96,015

204,445

241,451

10.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2022

2021

£

£

Leases (see note 11)

146,992

-

11.

FINANCIAL LIABILITIES - BORROWINGS

2022

2021

£

£

Current:

Leases (see note 12)

108,845

-

Non-current:

Leases (see note 12)

146,992

-

Terms and debt repayment schedule

1 year or

less

1-2 years

Totals

£

£

£

Leases

108,845

146,992

255,837

12.

LEASING

Right-of-use assets

Property, plant and equipment

2022

2021

£

£

Cost

Additions

363,498

-

Depreciation

Charge for year

107,661

-

Net book value

255,837

-

Lease liabilities

Minimum lease payments fall due as follows:

2022

2021

£

£

Gross obligations repayable:

Within one year

111,000

-

Between one and five years

148,000

-

259,000

-

Finance charges repayable:

Within one year

2,155

-

Between one and five years

1,008

-

3,163

-

Net obligations repayable:

Within one year

108,845

-

Between one and five years

146,992

-

255,837

-

13.	PROVISIONS FOR LIABILITIES

2022

2021

£

£

Deferred tax

Accelerated capital allowances

66,022

43,283

Deferred

tax

£

Balance at 1st January 2022

43,283

Provided during year

22,739

Balance at 31st December 2022

66,022