Greenwich Service Plus Limited - Limited company accounts 23.2

REGISTERED NUMBER: 07065923 (England and Wales)

GREENWICH SERVICE PLUS LIMITED

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2023

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Statement of Profit or Loss

9

Statement of Profit or Loss and Other Comprehensive Income

10

Statement of Financial Position

11

Statement of Changes in Equity

13

Statement of Cash Flows

14

Notes to the Statement of Cash Flows

15

Notes to the Financial Statements

16

DIRECTORS:

S M Stephenson

M Bakalovic

K T Scotford

I J Cooke

SECRETARY:

S K Sandhu

REGISTERED OFFICE:

Room 102

Birchmere Business Site Eastern Way

Thamesmead

LONDON

SE28 8BF

REGISTERED NUMBER:

07065923 (England and Wales)

AUDITORS:

McCabe Ford Williams

Statutory Auditors and Chartered Accountants

Building 1063

Cornforth Drive

Kent Science Park

Sittingbourne

Kent

ME9 8PX

GS Plus is a company limited by guarantee, whose ultimate parent is the Royal Borough of Greenwich, the activities of the company include:

- Fleet Management and Maintenance Service

- Building Cleaning Service

- Facilities Management Service

- Passenger Services

- Schools ICT support service

REVIEW OF BUSINESS

This is the 13th full year of trading for GS Plus. Turnover (excluding the sales associated with the exited school catering contracts, discussed below), increased from £21.3m to £22.9m reflecting the recovery of services from the impact of Covid-19 disruptions in the previous year, with accumulated resilience funds of £4.5m, an increase of £0.4m.

This year represented the fourth year of the company's Transformation Implementation Business Plan following the decision by the Cabinet of the Royal Borough of Greenwich (RBG) on 20th February 2019 with regard to its trading companies GS Plus Ltd and sister company GSS Ltd to "Insource Fleet, Passenger and Facilities Management services but move away from the provision of Catering, Schools ICT and Building Cleaning services (except RBG Building Cleaning)" over a 3 year period, which was subsequently extended for a further 3 year period to March 2025 and endorsed by the company's Board. Following the completion of a key target to exit school catering contracts in 2021 the priority in 2022 has been to review services, cost and price structures, particularly those that were heavily disrupted by Covid.

PRINCIPAL RISKS AND UNCERTAINTIES

Notwithstanding the change in strategic direction, the principal client of the company is the Royal Borough of Greenwich. Credit risk therefore remains low and trade is directly influenced by the parent. The continued global pressures driving inflation are now showing in increased domestic pay pressures during 2022 and are expected to continue into 2023. These costs, while built into financial plans will be mitigated where possible with other efficiencies in close cooperation with affected clients. These risks can be further underpinned by the resilience funds retained within the strong balance sheet.

FORWARD LOOKING STATEMENT

Following another successful year of operations and the stabilisation of key services, the company has commenced work to plan for continued operations beyond the current transformation period for sign off with the parent. Quarterly updates on the progress of the extended Business Plan and financial forecasts which continue to project surplus positions will be submitted to the Board, to ensure that the company position remains solvent and that Directors are compliant with their legal duties as Directors under the Companies Act 2006 and otherwise.

ON BEHALF OF THE BOARD:

M Bakalovic - Director

10 November 2023

The directors present their report with the financial statements of the company for the year ended 31 March 2023.

PRINCIPAL ACTIVITIES

The principal activities of the company in the year under review were those of fleet management and maintenance service, building cleaning service, facilities management service, passenger services and schools ICT support service.

DIRECTORS

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

S M Stephenson

M Bakalovic

K T Scotford

Other changes in directors holding office are as follows:

G P Dillon - resigned 24 May 2022

S J Merrill - appointed 25 May 2022

I J Cooke was appointed as a director after 31 March 2023 but prior to the date of this report.

S J Merrill ceased to be a director after 31 March 2023 but prior to the date of this report.

EQUALITY, DIVERSITY & INCLUSION

The Company is committed to encouraging equality, diversity and inclusion among our workforce, and eliminating unlawful discrimination. The aim is for our workforce to be truly representative of all sections of society and our customers, and for each employee to feel respected and able to give their best. The organisation, in providing services and/or facilities is also committed against unlawful discrimination of customers or the public.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with UK-adopted international accounting standards. 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 surplus or deficit 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 or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, McCabe Ford Williams, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

M Bakalovic - Director

10 November 2023

Opinion

We have audited the financial statements of Greenwich Service Plus Limited (the 'company') for the year ended 31 March 2023 which comprise the Statement of Profit or Loss, the Statement of Profit or Loss and Other Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 International Financial Reporting Standards (IFRSs) as adopted by the UK.

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 March 2023 and of its surplus for the year then ended;

-	have been properly prepared in accordance with IFRSs as adopted by the UK; 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 Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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

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

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

-	adequate accounting records have not been kept, 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.

Responsibilities of directors

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

In preparing the financial statements, the directors are responsible for assessing the 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:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

-

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

-

we identified the laws and regulations applicable to the company through discussions with management and our experience of the sector;

-

we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including, but not limited to, the Companies Act 2006 and UK tax legislation;

-

we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and

-

identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

-

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;

-

considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

-

performed analytical procedures to identify any unusual or unexpected relationships;

-

tested journal entries to identify unusual transactions;

-

assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and

-

investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

-

agreeing financial statement disclosures to underlying supporting documentation;

-

enquiring of management as to actual and potential litigation and claims; and

-

reviewing correspondence with HMRC and Companies House records.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

Ashley Phillips FCCA (Senior Statutory Auditor)

for and on behalf of McCabe Ford Williams

Statutory Auditors and Chartered Accountants

Building 1063

Cornforth Drive

Kent Science Park

Sittingbourne

Kent

ME9 8PX

20 November 2023

CONTINUING OPERATIONS

Revenue

22,935,092

23,292,337

Cost of sales

(20,456,841

)

(20,711,319

)

GROSS SURPLUS

2,478,251

2,581,018

Other operating income

3

71,180

301,650

Administrative expenses

(1,940,270

)

(1,528,056

)

OPERATING SURPLUS

609,161

1,354,612

Finance costs

5

(125,899

)

-

Finance income

5

32

11

SURPLUS BEFORE INCOME TAX

6

483,294

1,354,623

Income tax

7

(123,101

)

(158,497

)

SURPLUS FOR THE YEAR

360,193

1,196,126

SURPLUS FOR THE YEAR

360,193

1,196,126

OTHER COMPREHENSIVE INCOME

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

360,193

1,196,126

ASSETS

NON-CURRENT ASSETS

Owned

Property, plant and equipment

8

-

9,857

Right-of-use

Property, plant and equipment

8, 15

428,240

-

428,240

9,857

CURRENT ASSETS

Inventories

9

83,199

106,010

Trade and other receivables

10

2,599,934

3,497,338

Cash and cash equivalents

11

8,215,468

6,709,156

10,898,601

10,312,504

TOTAL ASSETS

11,326,841

10,322,361

EQUITY

SHAREHOLDERS' EQUITY

Retained earnings

12

4,474,293

4,114,100

TOTAL EQUITY

4,474,293

4,114,100

LIABILITIES

NON-CURRENT LIABILITIES

Financial liabilities - borrowings

Interest bearing loans and borrowings

14

473,629

-

CURRENT LIABILITIES

Trade and other payables

13

6,332,132

6,208,261

Financial liabilities - borrowings

Interest bearing loans and borrowings

14

46,787

-

6,378,919

6,208,261

TOTAL LIABILITIES

6,852,548

6,208,261

TOTAL EQUITY AND LIABILITIES

11,326,841

10,322,361

The financial statements were approved by the Board of Directors and authorised for issue on 10 November 2023 and were signed on its behalf by:

M Bakalovic - Director

Retained

Total

earnings

equity

£

£

Balance at 1 April 2021

2,917,974

2,917,974

Changes in equity

Total comprehensive income

1,196,126

1,196,126

Balance at 31 March 2022

4,114,100

4,114,100

Changes in equity

Total comprehensive income

360,193

360,193

Balance at 31 March 2023

4,474,293

4,474,293

Cash flows from operating activities

Cash generated from operations

1

1,796,936

2,560,330

Lease interest paid

(41,625

)

-

Tax paid

(209,029

)

(158,497

)

Net cash from operating activities

1,546,282

2,401,833

Cash flows from investing activities

Sale of tangible fixed assets

3,350

15,386

Interest received

32

11

Net cash from investing activities

3,382

15,397

Cash flows from financing activities

IFRS 16 lease liability payments

(43,352

)

-

Net cash from financing activities

(43,352

)

-

Increase in cash and cash equivalents

1,506,312

2,417,230

Cash and cash equivalents at beginning of year

2

6,709,156

4,291,926

Cash and cash equivalents at end of year

2

8,215,468

6,709,156

1.	RECONCILIATION OF SURPLUS BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS

31.3.23

31.3.22

£

£

Surplus before income tax

483,294

1,354,623

Depreciation charges

61,110

10,135

Profit on disposal of fixed assets

(3,350

)

(15,386

)

Finance costs

125,899

-

Finance income

(32

)

(11

)

666,921

1,349,361

Decrease in inventories

22,811

68,937

Decrease in trade and other receivables

897,404

2,133,138

Increase/(decrease) in trade and other payables

209,800

(991,106

)

Cash generated from operations

1,796,936

2,560,330

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 March 2023

31.3.23

1.4.22

£

£

Cash and cash equivalents

8,215,468

6,709,156

Year ended 31 March 2022

31.3.22

1.4.21

£

£

Cash and cash equivalents

6,709,156

4,291,926

1.	STATUTORY INFORMATION

Greenwich Service Plus Limited is a private company, limited by guarantee , 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 International Financial Reporting Standards and IFRIC interpretations and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention.

The company meets its day to day working capital requirements largely through its own activities but also through financial support from the Boroughs for which it operates facilities. The Directors expect this financial support to continue for the foreseeable future and therefore consider it appropriate to prepare the financial statements on a going concern basis. The financial statements do not include any adjustments that would result from the withdrawal of its financial support by the local authority.

Revenue recognition

Income represents net sales of goods and services excluding value added tax, to customers during the year.

Receipts

The Company, in most cases, receives an agreed payment from the Authority each year which may, in certain cases, be adjusted by inflation, service efficiencies and volume changes, but which is otherwise fixed.

Government grants

The company recognises government grants only when there is reasonable assurance that they will comply with the conditions attached to them and the grants will be received. Government grants are recognised in the statement of profit or loss on a systematic basis over the periods in which the entity recognises as expenses the related costs for which the grants are intended to compensate..

Cash and cash equivalents

Cash represents cash in hand and deposits held on demand with financial institutions. Cash equivalents are short-term, highly-liquid investments with original maturities of three months or less (as at their date of acquisition). Cash equivalents are readily convertible to known amounts of cash and subject to an insignificant risk of change in that cash value.

In the presentation of the Statement of Cash Flows, cash and cash equivalents also include bank overdrafts. Any such overdrafts are shown within borrowings under ‘current liabilities’ on the Statement of Financial Position.

Property, plant and equipment

The buildings and plant at the centres are leased to the Company as part of the overall contractual relationship with the Authority but the Authority maintains ultimate control of these assets. Accordingly the access which the Company has in the use of these assets is to enable it to provide the service it is contracted to provide, not to effectively own these public service assets. These assets are therefore not recognised on the Company's Balance Sheet.

Fixed assets costing £10,000 or more, for use outside of the centres, are capitalised at cost and are depreciated over their estimated useful economic lives.

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

Improvements to property - straight line over 3 years

Plant and machinery - straight line over 3 years

Motor vehicles - straight line over 3 years

Computer equipment - straight line over 3 years

Financial instruments

The company enters into basic financial instruments that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties and loans to related parties.

a) Trade and other debtors

Trade and other debtors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method, less impairment losses for bad and doubtful debts except where the effect of discounting would be immaterial. In such cases, the receivables are stated at cost less impairment losses for bad and doubtful debts.

b) Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and in hand.

c) Impairment of financial assets

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in profit or loss.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and the best estimate, which is an approximation, of the amount that the company would receive for the asset if it were to be sold at the reporting date.

d) Trade and other creditors

Debt instruments like loans and other accounts payable are initially measured at present value of the future payments and subsequently at amortised cost using the effective interest method. Debt instruments that are payable within one year, typically trade payables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an outright short-term loan not at market rate, the financial asset is measured, initially and subsequently, at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Inventories

Inventories are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

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.

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.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the company's accounting policies management is required to make judgements, estimates and assumptions about the carrying value 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 the 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.

The estimation of bad debts is based on previous history and any known factors at the time the financial statements are approved, however due to the level of trade debtors this represents an area of significant estimation uncertainty.

Further key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are the depreciation charges that are calculated with reference to the useful economic life of tangible fixed assets and the recoverability of tax trading losses along with any related deferred tax asset.

3.	OTHER OPERATING INCOME

31.3.23

31.3.22

£

£

Sundry receipts

71,180

45,022

Government grants

-

256,628

71,180

301,650

The outbreak of the COVID-19 pandemic, which began in the early months of 2020, continued through into the year ended 31 March 2022. The pandemic caused extensive disruption across the globe, and as with many businesses, the Company's activities were impacted.

Since the outbreak of the pandemic, the UK Government enforced several lockdowns to restrict the spread of the virus, with the final lockdown in the UK ending on 29 March 2021. All the remaining Government imposed restrictions on social distancing were removed on 24 February 2022.

Due to the nature of the business, it was necessary to furlough some members of the workforce during the year ended 31 March 2022 and the Company accessed Government support via the Coronavirus Job Retention Scheme.

No such income was relevant for the year ended 31 March 2023.

4.	EMPLOYEES AND DIRECTORS

31.3.23

31.3.22

£

£

Wages and salaries

8,189,167

9,030,788

Social security costs

599,071

579,177

Other pension costs

650,809

756,672

9,439,047

10,366,637

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

31.3.23

31.3.22

328

432

The above costs are inclusive of £31,315 of redundancy costs.

31.3.23

31.3.22

£

£

Directors' remuneration

54,476

51,439

The above remuneration relates to all directors in total.

5.	NET FINANCE COSTS

31.3.23

31.3.22

£

£

Finance income:

Deposit account interest

-

11

Corporation tax interest

32

-

32

11

Finance costs:

Leasing interest

125,899

-

Net finance costs

125,867

(11

)

6.	SURPLUS BEFORE INCOME TAX

The surplus before income tax is stated after charging/(crediting):

31.3.23

31.3.22

£

£

Cost of inventories recognised as expense

464,388

1,002,018

Depreciation - owned assets

9,857

10,134

Depreciation - assets on hire purchase contracts or finance leases

51,253

-

Profit on disposal of fixed assets

(3,350

)

(15,386

)

Auditors remuneration

16,605

15,185

7.	INCOME TAX

Analysis of tax expense

31.3.23

31.3.22

£

£

Current tax:

Taxation

121,541

178,183

Underprovision previous year

1,560

-

Overprovision previous year

-

(19,686

)

Total tax expense in statement of profit or loss

123,101

158,497

Factors affecting the tax expense

The tax assessed for the year is higher (2022 - lower) than the standard rate of corporation tax in the UK. The difference is explained below:

31.3.23

31.3.22

£

£

Surplus before income tax

483,294

1,354,623

Surplus multiplied by the standard rate of corporation tax in the UK of 19% (2022 - 19%)

91,826

257,378

Effects of:

Depreciation in excess of capital allowances

1,067

-

Expenses not allowable for tax purposes

29,285

1,487

Reversal of provisions taxed in prior years

-

(14,338

)

Over/(underprovision) in prior year

1,560

(19,686

)

Capital allowances in excess of depreciation

-

(2,248

)

Profit on disposal of assets

(637

)

(2,923

)

Changes in general provisions

-

(61,173

)

Tax expense

123,101

158,497

8.	PROPERTY, PLANT AND EQUIPMENT

Improvements

Leasehold

to

Plant and

property

property

machinery

£

£

£

COST

At 1 April 2022

-

76,116

889,478

Additions

442,117

-

37,376

Disposals

-

-

-

At 31 March 2023

442,117

76,116

926,854

DEPRECIATION

At 1 April 2022

-

76,116

889,478

Charge for year

42,959

-

8,294

Eliminated on disposal

-

-

-

At 31 March 2023

42,959

76,116

897,772

NET BOOK VALUE

At 31 March 2023

399,158

-

29,082

At 31 March 2022

-

-

-