Pareto Financial Planning Limited - Limited company accounts 23.2

REGISTERED NUMBER: 06582775 (England and Wales)

PARETO FINANCIAL PLANNING LIMITED

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2023

Page

Company Information

1

Report of the Directors

2

Report of the Independent Auditors

4

Statement of Income and Retained Earnings

8

Balance Sheet

9

Notes to the Financial Statements

10

DIRECTORS:

N J Aspray

S Carswell

D E Hardy-Dearness

C J Romain

J M Stevenson

P L Stones

P A Young

REGISTERED OFFICE:

Level 7, Tower 12, 18 22 Bridge Street,

Spinningfields

Manchester

M3 3BZ

REGISTERED NUMBER:

06582775 (England and Wales)

AUDITORS:

Clarke Nicklin LLP

Chartered Accountants and

Statutory Auditors

Clarke Nicklin House

Brooks Drive

Cheadle Royal Business Park

Cheadle

Cheshire

SK8 3TD

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

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of independent financial advisers.

DIRECTORS

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

N J Aspray

S Carswell

D E Hardy-Dearness

C J Romain

J M Stevenson

P L Stones

Other changes in directors holding office are as follows:

P A Young - appointed 21 September 2022

POLITICAL DONATIONS AND EXPENDITURE

During the year, the company made a political contribution of £50,000 to the Conservative and Unionist Party.

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). 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 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, Clarke Nicklin LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

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:

J M Stevenson - Director

30 October 2023

Opinion

We have audited the financial statements of Pareto Financial Planning Limited (the 'company') for the year ended 31 March 2023 which comprise the Statement of Income and Retained Earnings, Balance Sheet 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 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 company's affairs as at 31 March 2023 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:

Procedures to identify risks:

-

enquiring of management concerning the company's procedures relating to: identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of noncompliance; detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

-

discussing among the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas: timing of recognition of income and related expenses, posting of unusual journals; and

-

obtaining an understanding of the legal and regulatory frameworks that the company operates in, focusing on those laws and regulations that had a direct effect on the financial statements or that had a fundamental effect on the operations of the company. The key laws and regulations we considered in this context included UK Companies Act, employment law, health and safety, pensions legislation, tax legislation, and Financial Conduct Authority regulations.

The procedures to respond to risks identified included:

-

reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with relevant laws and regulations discussed above;

-

enquiring of management, concerning actual and potential litigation, claims, and customer complaints;

-

performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

-

reviewing correspondence with HMRC and the Financial Conduct Authority, where appropriate;

-

testing the timing and matching of income and related expense transactions either side of the year end; and

-

in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulation that are not closely related to events and transactions reflected in the financial statements. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detection one resulting from an error, as fraud may involve deliberate concealment, by for example, forgery or intentional misrepresentation, or through 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.

Graham Travis FCA (Senior Statutory Auditor)

for and on behalf of Clarke Nicklin LLP

Chartered Accountants and

Statutory Auditors

Clarke Nicklin House

Brooks Drive

Cheadle Royal Business Park

Cheadle

Cheshire

SK8 3TD

9 November 2023

TURNOVER

6,631,755

6,569,900

Cost of sales

821,549

835,003

GROSS PROFIT

5,810,206

5,734,897

Administrative expenses

5,092,539

4,279,439

717,667

1,455,458

Other operating income

-

25,500

OPERATING PROFIT

4

717,667

1,480,958

Interest receivable and similar income

2,314

-

719,981

1,480,958

Interest payable and similar expenses

9,562

8,549

PROFIT BEFORE TAXATION

710,419

1,472,409

Tax on profit

5

150,270

279,002

PROFIT FOR THE FINANCIAL YEAR

560,149

1,193,407

Retained earnings at beginning of year

1,687,089

1,434,659

Dividends

(843,117

)

(940,977

)

RETAINED EARNINGS AT END OF YEAR

1,404,121

1,687,089

FIXED ASSETS

Intangible assets

6

13,102

11,913

Tangible assets

7

115,389

112,748

128,491

124,661

CURRENT ASSETS

Debtors

8

1,341,348

1,675,508

Cash at bank

884,539

900,131

2,225,887

2,575,639

CREDITORS

Amounts falling due within one year

9

918,034

989,425

NET CURRENT ASSETS

1,307,853

1,586,214

TOTAL ASSETS LESS CURRENT LIABILITIES

1,436,344

1,710,875

PROVISIONS FOR LIABILITIES

11

32,123

23,686

NET ASSETS

1,404,221

1,687,189

CAPITAL AND RESERVES

Called up share capital

12

100

100

Retained earnings

1,404,121

1,687,089

SHAREHOLDERS' FUNDS

1,404,221

1,687,189

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 30 October 2023 and were signed on its behalf by:

J M Stevenson - Director

1.	STATUTORY INFORMATION

Pareto Financial Planning 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.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The financial statements are presented in Sterling (£).

Going concern

The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors have reached this conclusion giving due consideration to the projected future performance of the company and any potential risk that might impact the company's ability to meet its required solvency levels. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

Related party exemption

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

Significant judgements and 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 revision only affects that period, or in the period of the revision and future periods if the revision affects both current and future periods.

There are no judgements considered to have had a significant effect on amounts recognised in the financial statements.

Turnover

Turnover is derived from commissions received and fees generated. Income is taken to the profit and loss account on the following basis: Initial commission as and when the policy is in force. Renewal and fund based commission is credited on a receipts basis and fee income as and when a sales invoice is generated.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2010, is being amortised evenly over its estimated useful life of five years.

Website development

Website development expenditure is recognised as an intangible asset when the company can demonstrate:

- The technical feasibility of completing the intangible asset so that it will be available for use or sale

- Its intention to complete and its ability to use or sell the asset

- How the asset will generate future economic benefits

- The availability of resources to complete the asset

- The ability to measure reliably the expenditure during development

Following initial recognition of the website development expenditure as an asset, the asset is carried at cost less any accumulated amortisation and impairment losses. Amortisation of the asset begins when development is complete and the asset is available for use. It is amortised over its useful life of three years.

Tangible fixed assets

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

Leasehold improvements

-

20% on cost

Furniture and fittings

-

20% on cost

Computer equipment

-

33% on cost

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

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

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Pension costs and other post-retirement benefits

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

Financial assets

Basic financial assets, including trade debtors, cash and bank balances and amounts owed by group undertakings, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Such assets are subsequently carried at amortised cost using the effective interest method.

At the end of each reporting period, financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in the income statement.

If there is a decrease in the the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in the income statement.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party, or (c) control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

Financial liabilities

Basic financial liabilities, including trade creditors and amounts owed to group undertakings, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 75 (2022 - 65 ) .

2023

2022

£

£

Directors' remuneration

477,772

527,140

Directors' pension contributions to money purchase schemes

37,661

68,888

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

5

6

Information regarding the highest paid director is as follows:

2023

2022

£

£

Emoluments etc

154,813

201,787

Pension contributions to money purchase schemes

13,000

12,633

4.	OPERATING PROFIT

The operating profit is stated after charging:

2023

2022

£

£

Depreciation - owned assets

62,825

56,377

Website development amortisation

6,311

337

Auditors' remuneration

13,850

14,500

5.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2023

2022

£

£

Current tax:

UK corporation tax

141,833

275,062

Deferred tax

8,437

3,940

Tax on profit

150,270

279,002

UK corporation tax has been charged at 19% .

6.	INTANGIBLE FIXED ASSETS

Website

Goodwill

development

Totals

£

£

£

COST

At 1 April 2022

1,200,000

12,250

1,212,250

Additions

-

7,500

7,500

At 31 March 2023

1,200,000

19,750

1,219,750

AMORTISATION

At 1 April 2022

1,200,000

337

1,200,337

Amortisation for year

-

6,311

6,311

At 31 March 2023

1,200,000

6,648

1,206,648

NET BOOK VALUE

At 31 March 2023

-

13,102

13,102

At 31 March 2022

-

11,913

11,913

7.	TANGIBLE FIXED ASSETS

Furniture

Leasehold

and

Computer

improvements

fittings

equipment

Totals

£

£

£

£

COST

At 1 April 2022

80,817

111,457

118,180

310,454

Additions

-

19,825

45,641

65,466

At 31 March 2023

80,817

131,282

163,821

375,920

DEPRECIATION

At 1 April 2022

80,817

61,728

55,161

197,706

Charge for year

-

21,733

41,092

62,825

At 31 March 2023

80,817

83,461

96,253

260,531

NET BOOK VALUE

At 31 March 2023

-

47,821

67,568

115,389

At 31 March 2022

-

49,729

63,019

112,748

8.

DEBTORS

2023

2022

£

£

Amounts falling due within one year:

Trade debtors

606,233

571,658

Other debtors

292,964

249,159

Directors' current accounts

-

10,327

Prepayments and accrued income

442,151

372,207

1,341,348

1,203,351

Amounts falling due after more than one year:

Other debtors

-

472,157

Aggregate amounts

1,341,348

1,675,508

9.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023

2022

£

£

Bank loans and overdrafts

-

139,103

Other loans

26,354

26,150

Trade creditors

104,253

81,190

Corporation tax

14,689

142,061

Social security and other taxes

78,990

87,860

VAT

47,553

51,751

Other creditors

38,261

28,370

Accrued expenses

607,934

432,940

918,034

989,425

Accrued expenses includes unpaid pension contributions of £33,383 (2022: £30,812).

10.	LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

2023

2022

£

£

Within one year

140,140

140,140

Between one and five years

46,713

186,853

186,853

326,993

11.	PROVISIONS FOR LIABILITIES

2023

2022

£

£

Deferred tax

32,123

23,686

Deferred

tax

£

Balance at 1 April 2022

23,686

Charge to Statement of Income and Retained Earnings during year

8,437

Balance at 31 March 2023

32,123

The provision for deferred taxation is made up as follows

2023

2022

£

£

Accelerated capital allowances

32,123

23,686

32,123

23,686

12.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2023

2022

value:

£

£

100

Ordinary

£1

100

100

13.	CONTINGENT LIABILITIES

The company is a party to a cross guarantee, giving a fixed and floating charge over the company's assets, in respect of a liability of Primas Newco 3 Limited, the company's ultimate parent. The liability outstanding at 31 March 2023 is £1,868,000 (2022: £1,868,000).

14.	RELATED PARTY DISCLOSURES

At 31 March 2023 key management personnel owed the company a total of £Nil (2022: £10,327). The amount is included in debtors due within one year, is repayable on demand and interest is payable on the loan at 2.5% per annum.

At 31 March 2023 the company was owed £283,938 (2022: £672,157) by entities under common control.

15.	ULTIMATE CONTROLLING PARTY

The immediate parent company is Stechant Limited, a company registered in England and Wales, and controlled by J M Stevenson.

The ultimate parent company is Primas Newco 3 Limited, a company registered in England and Wales, and controlled by J M Stevenson.