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Company registration number: 11603798
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FOR THE YEAR ENDED
31 DECEMBER 2022
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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COMPANY INFORMATION
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Chartered Accountants & Statutory Auditor
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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CONTENTS
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Statement of financial position
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Notes to the financial statements
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
REGISTERED NUMBER:11603798
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STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Net current (liabilities)/assets
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 2 to 11 form part of these financial statements.
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Architectural Panel Solutions Limited is a private company limited by shares incorporated in England and Wales. The address of the registered office is disclosed on the company information page.
The financial statements are presented in £ and are rounded to the nearest pound.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The following principal accounting policies have been applied:
The Company made a loss before tax of £878,239 (2021: £620,043 ) for the year ended 31 December 2022. At the balance sheet date, the Company reported net current liabilities of £612,103 (2021: £363,570), including current liabilities of £3,342,937 (2021: £1,812,050) and net liabilities of £2,864,934 (2021: £1,986,695).
During the year ended 31 December 2022, there were delays in completing sales orders because of operational challenges which have since been rectified. The lower level of sales had a negative impact on the cash position of the Company and by the end of 2022 it was necessary for the Company to seek additional funding from their investors. The further funding was completed in March 2023 through a further cash injection of £250,000, together with the introduction of an invoice discounting facility to provide cash headroom. Following improved trading in 2024 an increase to the invoice discounting facility has been secured, improved repayment terms have also been secured on senior facilities to ensure affordability of the existing loan finance.
As part of the refinancing exercise described above, the Directors have prepared forecasts for the two years ended 31 December 2025 and have confirmed, together with reviews undertaken by all investors, that they are forecasting all EBITDA and cash covenants to be met during this period.
The Company holds loan notes on its balance sheet at 31 December 2022 of £2.35m plus interest of £1.45.m which are due for repayment on 31 March 2024. The directors have received assurance from the holders of these loan notes that they do not intend to seek repayment unless funds permit.
Taking the above into consideration, the Directors are confident given the actions taken that the Company will have adequate resources to continue growing and building the business over the foreseeable future. Accordingly, the financial statements continue to adopt the going concern basis.
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of income and retained earnings except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of income and retained earnings within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Statement of income and retained earnings within 'other operating income'.
Revenue from the sale of rainscreen cladding and fixing systems is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, which is usually when the goods are despatched to the customer and the significant risks and rewards of ownership have transferred. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Grants are accounted under the accruals model as permitted by FRS 102. Grants of a revenue nature are recognised in the Statement of income and retained earnings in the same period as the related expenditure.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.
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Current and deferred taxation
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Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of financial position date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
As at 31 December 2022, the Company had unutilised tax losses totaling £507,857 (2021: £275,455). No deferred tax asset has been provided in connection with these losses.
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of its identifiable assets and liabilities at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Statement of income and retained earnings over its useful economic life, which is considered to be 10 years as this is the directors' best estimate of the period over which the products and knowledge acquired on transfer of trade and assets will continue to generate value for the business.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
Testing and accreditations represent the capitalised cost of research and development in connection with obtaining relevant fire safety accreditations for the Company's products. Testing and accreditations costs are amortised over a period of 10 years, which represents the directors' best estimate of the period for which the current regulations will remain in place and therefore the period over which the accreditations will continue to generate future cash inflows to the business.
Computer software assets represent the capitalises costs incurred by the Company in implementing its finance and CRM systems. Computer software is amortised over a period of 5 years as this is the directors' best estimate of the period for which the software will be utilised before a replacement or upgrade is required.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
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Testing and accreditations
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Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line and reducing balance method.
Depreciation is provided on the following basis:
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Long-term leasehold property
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Straight line over the lease term
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
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The average monthly number of employees, including directors, during the year was 44 (2021 -37).
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Long-term leasehold property
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Prepayments and accrued income
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Accruals and deferred income
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Other loans are secured by means of a fixed and floating charge over all property or undertaking of the Company.
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Creditors: Amounts falling due after more than one year
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Other loans are secured by means of a fixed and floating charge over all property or undertaking of the Company.
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts falling due 1-2 years
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Amounts falling due 2-5 years
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Commitments under operating leases
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At 31 December 2022 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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ARCHITECTURAL PANEL SOLUTIONS LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
The auditors' report on the financial statements for the year ended 31 December 2022 was qualified.
The qualification in the audit report was as follows:
Basis for qualified opinion
We were unable to attend the stock count at 31 December 2022 and thus did not observe the counting of physical
inventories at the end of the year. We were unable to satisfy ourselves by alternative means concerning inventory quantities held at 31 December 2022, which are included in the balance sheet at £1,403,136, by using other audit procedures. Consequently we were unable to determine whether any adjustment to this amount was necessary.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the 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 qualified opinion.
Matters on which we are required to report by exception
Except for the possible effects of the matter described in the basis for qualified opinion section of our report,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 Directors' report.
Arising solely from the limitation on the scope of our work relating to inventory, referred to above:
- we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
- we were unable to determine whether adequate accounting records have been kept.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
- 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' exemptions in preparing the Directors' report and from the requirement
to prepare a Strategic report.
The audit report was signed on 19 March 2024 by Caroline Milton FCA (Senior statutory auditor) on behalf of Menzies LLP.
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