Systems Interface Limited - Limited company accounts 23.2

REGISTERED NUMBER: 01643486 (England and Wales)

Report of the Directors and

Audited Financial Statements

for the Year Ended 31 December 2023

for

Systems Interface Limited

Page

Company Information

1

Report of the Directors

2

Report of the Independent Auditors

4

Income Statement

8

Other Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Notes to the Financial Statements

12

DIRECTORS:

Mr P A Gurney

Mr P R Heaney

Mr A W Madge

SECRETARY:

Mr M L Mulberry BA (Hons) FCCA CTA

REGISTERED OFFICE:

Suite 9C

Oakhanger Business Park

Oakhanger

Near Bordon

Hampshire

GU35 9JA

REGISTERED NUMBER:

01643486 (England and Wales)

SENIOR STATUTORY AUDITOR:

Mr Mark Williams FCA

AUDITORS:

Williams & Co Epsom LLP

8-10 South Street

Epsom

Surrey

KT18 7PF

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

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the provision of complex airport and air traffic control systems, including design, integration, installation, commissioning and maintenance services, which includes amongst others,

Navigation Aids - such as ILS, DME, DVOR, NDB, DF

Communications - VHF/UHF Voice, VCS and Data

Airfield Lighting - Including LED Solar lights

Meteorological Systems - IRVR, Weather Stations

The company also offers a wide spectrum of aviation related products and services both in the UK and worldwide, and is a distributor for Nautel for NDB's and Avlite for their solar powered lights. Systems interface Limited is Quality Approved to BS EN 9001:2015

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2023.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

Mr P A Gurney

Mr P R Heaney

Mr A W Madge

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, Williams & Co Epsom LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr A W Madge - Director

25 January 2024

Opinion

We have audited the financial statements of Systems Interface Limited (the 'company') for the year ended 31 December 2023 which comprise the Income Statement, Other Comprehensive Income, 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 31 December 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. Our evaluation of the directors' assessment of the company's ability to continue to adopt the going concern basis of accounting included discussions with management with regards to forecasts and cashflows, and how the Company's business model addresses the risks that they face. We assessed and challenged the reasonableness of estimates made by the directors and the related disclosures. In particular, we assessed and challenged the sales pipeline and likelihood of winning future contracts.

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.

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 Company is subject to laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements. These include financial reporting and tax legislation, employment law and health & safety legislation.

We communicated relevant 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.

We discussed with management the application of these legal requirements and enquired as to any instances of non-compliance.

The results of our risk assessment at the planning stage formed the basis of designing audit procedures to identify non-compliance with the laws and regulations as mentioned above.

These audit procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, and detecting irregularities that result from fraud is inherently more difficult than detecting those that result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also, the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we would become aware of it.

In assessing the potential risks of material misstatement, we obtained an understanding of the Company's operations, including the nature of their revenue sources, products and services and of its objectives and strategies to understand the classes of transactions, account balances, expected financial statement disclosures and business risks that may result in risks of material misstatement.

We reviewed the business' control environment and the application of those controls with regards to authorisation of transactions and the correct reporting of transactions. We carried out walkthroughs on the systems in place.

We performed audit procedures on the journal entries posted to the accounting package to assess the entries for appropriateness and check for entries that are significant or outside the usual course of business.

We reviewed the accounting estimates for reasonableness and assessed management's view on significant judgements made. Work in this area focussed on costs to complete on project work as this has a direct impact on the revenue recognition due to the accounting policy and is material to the accounts.

We tested the cut-off in terms of revenue and purchases as this was deemed an area of high risk.

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.

Mr Mark Williams FCA (Senior Statutory Auditor)

for and on behalf of Williams & Co Epsom LLP

8-10 South Street

Epsom

Surrey

KT18 7PF

25 January 2024

TURNOVER

3

4,829,086

4,012,448

Cost of sales

(3,228,006

)

(2,868,291

)

GROSS PROFIT

1,601,080

1,144,157

Distribution costs

(111,343

)

(216,112

)

Administrative expenses

(731,962

)

(606,892

)

OPERATING PROFIT

757,775

321,153

Interest receivable and similar income

5

6,843

67

764,618

321,220

Interest payable and similar expenses

6

(103,060

)

(69,050

)

PROFIT BEFORE TAXATION

7

661,558

252,170

Tax on profit

8

73,330

-

PROFIT FOR THE FINANCIAL YEAR

734,888

252,170

PROFIT FOR THE YEAR

734,888

252,170

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

734,888

252,170

FIXED ASSETS

Owned

Tangible assets

9

12,252

12,757

Right-of-use

Tangible assets

9, 15

97,716

17,748

109,968

30,505

CURRENT ASSETS

Stocks

10

47,227

186,988

Debtors: amounts falling due within one year

11

318,554

270,266

Debtors: amounts falling due after more than one year

11

73,330

-

Prepayments and accrued income

378,302

330,886

Cash at bank and in hand

873,574

839,227

1,690,987

1,627,367

CREDITORS

Amounts falling due within one year

12

(1,033,328

)

(1,282,916

)

NET CURRENT ASSETS

657,659

344,451

TOTAL ASSETS LESS CURRENT LIABILITIES

767,627

374,956

CREDITORS

Amounts falling due after more than one year

13

(814,577

)

(1,156,794

)

NET LIABILITIES

(46,950

)

(781,838

)

CAPITAL AND RESERVES

Called up share capital

17

10,000

10,000

Retained earnings

18

(56,950

)

(791,838

)

SHAREHOLDERS' FUNDS

(46,950

)

(781,838

)

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 25 January 2024 and were signed on its behalf by:

Mr A W Madge - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2022

10,000

(1,044,008

)

(1,034,008

)

Changes in equity

Total comprehensive income

-

252,170

252,170

Balance at 31 December 2022

10,000

(791,838

)

(781,838

)

Changes in equity

Total comprehensive income

-

734,888

734,888

Balance at 31 December 2023

10,000

(56,950

)

(46,950

)

1.	STATUTORY INFORMATION

Systems Interface 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 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 paragraphs 45(b) and 46 to 52 of IFRS 2 Share-based Payment;

•

the requirements of paragraphs 62, B64(d), B64(e), B64(g), B64(h), B64(j) to B64(m), B64(n)(ii), B64(o)(ii), B64(p), B64(q)(ii), B66 and B67 of IFRS 3 Business Combinations;

•

the requirements of paragraph 33(c) of IFRS 5 Non Current Assets Held for Sale and Discontinued Operations;

•

the requirements of paragraph 24(6) of IFRS 6 Exploration for and Evaluation of Mineral Resources;

•

the requirements of IFRS 7 Financial Instruments: Disclosures;

•

the requirements of paragraphs 91 to 99 of IFRS 13 Fair Value Measurement;

•

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 requirements of the second sentence of paragraph 110 and paragraphs 113(a), 114, 115, 118, 119(a) to (c), 120 to 127 and 129 of IFRS 15 Revenue from Contracts with Customers;

•

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;

-

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

-

paragraph 118(e) of IAS 38 Intangible Assets;

-

paragraphs 76 and 79(d) of IAS 40 Investment Property; and

-

paragraph 50 of IAS 41 Agriculture;

•

the requirements of paragraphs 10(d), 10(f), 16, 38A, 38B, 38C, 38D, 40A, 40B, 40C, 40D, 111 and 134 to 136 of IAS 1;

•

the requirements of IAS 7 Statement of Cash Flows;

•

the requirements of paragraphs 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors;

•

the requirements of paragraph 74(b) of IAS 16;

•

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;

•

the requirements of paragraphs 134(d) to 134(f) and 135(c) to 135(e) of IAS 36 Impairments of Assets.

Critical accounting judgements and key sources of estimation uncertainty

Revenue is recognised over time based on the progress towards satisfaction of the performance obligation using the input method. Invoicing of orders completed over time is based on estimated contract costs, the achievable contract revenue, and the risks associated with the contract. These estimates are regularly reviewed and revised. Although the estimates are made using all information available at the reporting date, changes may occur. These changes may affect both the revenue recognised and the carrying amounts of contract assets.

Turnover

For the vast majority of the entity's contracts with customers, revenue is recognised over time and therefore revenue is recognised on the basis of the progress towards satisfaction of the performance obligation using the input method.

Under this method, revenues are recognised on the basis of the production costs actually incurred in relation to expected total cost. The impact of changes in the estimated total cost is recognised in profit or loss in the period in which it occurs.

For other revenue items, turnover represents net invoiced sales of goods and work done, excluding value added tax.

Tangible fixed assets

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

Freehold property

-

in accordance with the property

Plant and machinery

-

10% on cost

Fixtures and fittings

-

25% on reducing balance

Motor vehicles

-

25% on cost

Computer equipment

-

25% on cost and 25% on reducing balance

Stocks

Stocks and work in progress 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.

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

Foreign currencies

The Company’s financial statements are presented in sterling, which is also the Company’s functional currency.

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.

Going concern

Our parent Company remains positive to our situation and continues to offer financial support and accordingly the directors have prepared the financial statements on a going concern basis.

At this time, the directors are of the opinion that no debtor is likely to be realised for an amount less than the amount at which it is recorded in the financial statements and accordingly, no adjustments have been made to the financial statements relating to the recoverability and classification of debtor carrying amounts or to the amount and classification of liabilities that might be necessary should the Company not continue as a going concern.

However, in the event that the company is not able to win new contracts referred to above, there is uncertainty whether the company would continue as a going concern and therefore, whether it would be able to settle its liabilities and commitments in the normal course of business.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

31.12.23

31.12.22

£

£

United Kingdom

1,742,023

379,400

Europe

1,995,110

143,798

Africa

916,403

1,321,399

Middle east

-

100,170

Rest of World

175,550

2,067,681

4,829,086

4,012,448

4.	EMPLOYEES AND DIRECTORS

31.12.23

31.12.22

£

£

Wages and salaries

548,715

494,463

Social security costs

59,601

51,723

Other pension costs

47,878

60,532

656,194

606,718

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

31.12.23

31.12.22

Directors

2

2

Administration

4

2

Direct

4

5

10

9

31.12.23

31.12.22

£

£

Directors' remuneration

184,350

226,282

Directors' pension contributions to money purchase schemes

35,272

50,933

5.

INTEREST RECEIVABLE AND SIMILAR INCOME

31.12.23

31.12.22

£

£

Deposit account interest

6,843

67

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

31.12.23

31.12.22

£

£

Bank interest

-

4,107

Bank loan interest

86,554

48,586

Other interest and charges

16,506

16,357

103,060

69,050

7.	PROFIT BEFORE TAXATION

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

31.12.23

31.12.22

£

£

Cost of inventories recognised as expense

3,228,006

2,868,291

Leases

18,587

12,271

Depreciation - owned assets

4,755

4,253

Depreciation - assets on hire purchase contracts or finance leases

19,532

15,442

Auditors' remuneration

8,750

8,500

Foreign exchange differences

32,008

(27,324

)

8.

TAXATION

Analysis of tax income

31.12.23

31.12.22

£

£

Deferred tax

(73,330

)

-

Total tax income in income statement

(73,330

)

-

9.	TANGIBLE FIXED ASSETS

Improvements

Freehold

Short

to

Plant and

property

leasehold

property

machinery

£

£

£

£

COST

At 1 January 2023

46,251

51,715

-

-

Additions

-

88,700

10,800

4,250

Disposals

-

(30,158

)

-

-

At 31 December 2023

46,251

110,257

10,800

4,250

DEPRECIATION

At 1 January 2023

46,251

33,967

-

-

Charge for year

-

19,532

-

-

Eliminated on disposal

-

(30,158

)

-

-

At 31 December 2023

46,251

23,341

-

-

NET BOOK VALUE

At 31 December 2023

-

86,916

10,800

4,250

At 31 December 2022

-

17,748

-

-

Fixtures

and

Motor

Computer

fittings

vehicles

equipment

Totals

£

£

£

£

COST

At 1 January 2023

15,615

13,214

122,591

249,386

Additions

-

-

-

103,750

Disposals

(12,788

)

-

(106,588

)

(149,534

)

At 31 December 2023

2,827

13,214

16,003

203,602

DEPRECIATION

At 1 January 2023

14,860

13,214

110,589

218,881

Charge for year

755

-

4,000

24,287

Eliminated on disposal

(12,788

)

-

(106,588

)

(149,534

)

At 31 December 2023

2,827

13,214

8,001

93,634

NET BOOK VALUE

At 31 December 2023

-

-

8,002

109,968

At 31 December 2022

755

-

12,002

30,505

10.

STOCKS

31.12.23

31.12.22

£

£

Stocks

29,689

39,178

Work-in-progress

17,538

147,810

47,227

186,988