Bar_2064_Limited - Accounts

The director presents the strategic report for the year ended 31 March 2023.

The company is primarily engaged in the professional contracting sector. During the year turnover increased by some 14% as the economy continued to recover from the Covid pandemic.

In June 2023 a client, Henry Construction Projects Limited, entered Insolvency Proceedings, via Administration. The scale of the insolvency is such that we anticipate that it will take many months for the Administrators to complete their work. However, early indications from them are that the unsecured creditors, including Bar 2064 Limited, may receive a dividend from the liquidation of the assets. Their initial estimate was that a dividend equivalent 5p in the Pound could be payable. In their interim report of January 2024 the Administrators repeated the statement that a dividend continues to be likely. In that event the company could recover up to £135,000. Given the uncertainty we have not provided for any recovery and have provided for the potential loss.

In addition, Bar 2064 is owed £208,000 by Henry Construction Projects (Ireland) Limited, a company registered in the Republic of Ireland. That company ceased trading in June 2023. We have taken legal action in the Republic of Ireland and filed an unchallenged claim for the full amount owed. Our investigations reveal that Henry has a significant debt from the Irish Tax Authority in connection with recoverable Relevant Contracts Tax ('RCT'). Our belief at this time is that we will recover this debt in full, although again, this may take many months.

The principal uncertainty facing the business is the overall state of the UK economy which, as evidenced by the loss of a major client, is suffering from increasing numbers of business failures continuing inflationary pressures and rising interest rates. While the business is not at any risk from rising interest rates the majority of our clients are and these cost pressures are already apparent in some clients.

Key performance indicators

The key performance indicators used in the management of the business are as follows:

2023 2022

(Loss)/profit before tax (£590,362) (£130,163)

Debtor Days      1.16 1

The financial statements are drawn up for the 52 weeks to 31 March 2023 (''the financial year'').

Comparative figures are for the 52 weeks ended 1 April 2022.

S172 Statement

1. The director, when making any decisions affecting the company, has regards to the long term consequences of any decision. These decisions take account of any known impacts of taxation changes, general economic decisions and include detailed forecasting and planning of such areas as cash flow and resources

    

2. All decisions are taken with the best interests of employees at their core

    

3. The company is aware of and seeks to foster good relationships with employees, suppliers customers and others

    

4. The business has limited impact on the community or the environment but, where there may be an impact, seeks to minimise this

    

5. The business intends to operate with a high level of integrity and compliance with all applicable law

    

6. The business, at all times, seeks to act fairly as between the members of the company

    

7. The business, at all times, seeks to act fairly as between the members of the company

Statement of Engagement with Employees

• The directors engage with employees in a number of ways, including a dedicated service team who are available on extended working hours and can be engaged via telephone, email and web chat

• The company regularly publishes blogs and articles on issues which may affect its employees

• The company makes a number decisions in the course of any year. These decisions take due regard of the employees engaged by the company and seek to enhance their work experience with the company

Statement on Business Relationships

• The director is aware that fostering relationships with suppliers, customers and others is of vital importance to its future success and maintains transparency in these relationships at all times

Statement of Corporate Governance Arrangements

• The company has not applied any corporate governance code. The director is not remunerated by the company in any way

On behalf of the board

The director presents his annual report and financial statements for the year ended 31 March 2023.

The company is primarily engaged in the professional contracting sector.

The results for the year are set out on page 10.

No ordinary dividends were paid. The director does not recommend payment of a final dividend.

The director who held office during the year and up to the date of signature of the financial statements was as follows:

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.

There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.

Saffery LLP have expressed their willingness to continue in office.

Energy Consumption             2023             2022

                     Kwh             Kwh

Aggregate Energy Consumption in Year    8,187,442        8,473,055

                 Metric Tonnes     Metric Tonnes

Emissions of CO2 Equivalent        

Scope 3 – Other indirect emissions

• Fuel consumed for transpost

Not owned by the business     3,039             3,145

Intensity Ratio

    Tonnes CO2 per employee         2.1             4.1

Quantification and reporting methodology

We have followed the 2019 HM Government Environment Reporting Guidelines. We have also used the GHG

Reporting Protocol – Corporate Standard and have used the 2022 UK Governments Conversion Factors for

Company Reporting

Intensity Measurement

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2 per employee.

Measures taken to improve energy efficiency

We encourage employees to use alternative public transport where available and to consider purchasing electric vehicle when selecting a replacement vehicle.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:

•     select suitable accounting policies and then apply them consistently;

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

•     state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

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

The director is 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. He is 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.

We have audited the financial statements of Bar 2064 Limited (the 'company') for the year ended 31 March 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including 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 loss 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 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 opinion.

Material uncertainty related to going concern

We draw attention to Note 1.2 in the financial statements, which indicates that the company had net liabilities of £0.72m and cash and cash equivalents of £2.56m as at 31 March 2023. As stated in Note 1.2, these events or conditions, along with other matters as set forth in Note 1.2, indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern.

Our opinion is not modified in respect of this matter.

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

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

Other information

The director is responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report 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.

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 course of 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 director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the director's report have been prepared in accordance with applicable legal requirements.

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 director's report.

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:

•     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 remuneration specified by law are not made; or

•     we have not received all the information and explanations we require for our audit.

As explained more fully in the director's responsibilities statement, the director is 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 director determines is 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

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 an auditor's report 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.

Identifying and assessing risks related to irregularities:

We assessed the susceptibility of the company’s financial statements to material misstatement and how fraud might occur, including through discussions with the director, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the company by discussions with director and by updating our understanding of the sector in which the company operates.

Laws and regulations of direct significance in the context of the company include The Companies Act 2006 and UK Tax legislation.

Audit response to risks identified

We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the company's records of breaches of laws and regulations, minutes of meetings and correspondence with relevant authorities to identify potential material misstatements arising. We discussed the company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance.

During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 an auditor's report 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.

The income statement has been prepared on the basis that all operations are continuing operations.

Bar 2064 Limited is a private company limited by shares incorporated in England and Wales. The registered office is Mitre House, North Park Road, Harrogate, North Yorkshire, HG1 5RX.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are drawn up for the 52 weeks to 31 March 2023 (''the financial year''). Comparative figures are for the year ended 31 March 2022.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The financial statements have been prepared on a going concern basis. At 31 March 2023 the company had net liabilities of £0.72m and cash and cash equivalents of £2.56m. The Director has considered the current and future financial requirements and prepared a cash flow forecast for the period ending 31 March 2025. These forecasts show that the company, when supported by Procap Services Limited, its key trading partner and a related party, as well as its two sister companies, Bar 2010 Limited and Bar 2080 Limited, will generate sufficient cash to meet its obligations as they fall due. The company has received a letter of ongoing financial support from Procap Services Limited, confirming its intention to continue to support the company for a period of at least 12 months from the date at which these accounts are signed.true

The ability of Procap Services Limited to provide the ongoing financial support is dependent on certain contract rebates not falling due for repayment by Procap Services Limited in the forecast period. There are also certain obligations in relation to contract monies recognised at the balance sheet date in the Company and its two sister companies, Bar 2010 Limited and Bar 2080 Limited, which the Director does not expect to be repayable in the forecast period. However, should these amounts fall due for repayment in the forecast period, this would affect the Company’s ability to meet its obligations as they fall due.

While the Director remains confident that necessary funds will be available as and when required, as at the date of this report the availability of the required support in the future is contingent on events of which the outcome is uncertain. Accordingly, there is a material uncertainty that may cast significant doubt over the Company’s ability to continue as a going concern.

On the basis of the current information the Director believes that it remains appropriate to prepare the financial statements on a going concern basis. The financial statements do not include any adjustments that would result from this basis of preparation not being appropriate. Should the Company be required to repay the contract monies or Procap Services Limited be required to repay the contract rebates in the forecast period to an extent that the going concern basis of preparation was no longer appropriate, adjustments may be required to the figures presented at the date of this report.

Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.

Goodwill arising on the acquisition of the trade in Bar 2010 Limited and Bar 2080 Limited represents the excess of the fair value of the consideration over the fair value of the identifiable assets and liabilities acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 4 years. The company has an accounting policy to not amortise in the year of acquisition.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally 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.

Basic financial assets, which include debtors, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. 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 profit or loss.

If there is a decrease in 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 profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable 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.

Other financial liabilities, including debt instruments that do not meet the definition of a basic financial instrument, are measured at fair value through profit or loss.

Debt instruments may be designated as being measured at fair value though profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

In the application of the company’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The following estimates have had the most significant effect on amounts recognised in the financial statements.

A provision is made for bad and doubtful debts. This provision requires management's best estimate of the recoverability of trade debtors.

An analysis of the company's turnover is as follows:

The average monthly number of persons (including directors) employed by the company during the year was:

Their aggregate remuneration comprised:

The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:

At 31 March 2023, the company had tax losses available for carry forward of approximately £526,566 (2022: £33,103). The company has not recognised deferred tax assets relating to such earned forward losses of approximately £131,641 (2022: £8,296)

The director considers that there is insufficient evidence of future taxable income, taxable temporary differences and feasible tax-planning strategies to utilise all of the cumulative losses and therefore it is not considered certain that the deferred tax assets will be realised in full. If future income differs from current projections, this could significantly impact the tax charge or benefit in future years.

The goodwill additions arose on the acquisition of part of the trade of Bar 2010 Limited and Bar 2080 Limited

All shares carry the same voting rights, rights to participate in dividend distributions and rights to participate in any distribution of capital on winding up of the company.

Bar 2064 Limited, together with two other companies (Bar 2080 Limited and Bar 2010 Limited), jointly administers payroll funds via a bank account held by Procap Services Limited. Cross guarantees exist between these companies, including financial support from Procap Services Limited, until such time as the net current liabilities and deficit on shareholder funds of this company becomes positive. The cross guarantee extends to historic differences between the account held with Procap Services and the accounts held on the balance sheet of the three companies.

Kenneth Taylor is a director of Bar 2080 Limited. At the year end an amount of £793,177 (2022: £1,000,493) was due from Bar 2080 Limited and is included in other debtors.

Kenneth Taylor is also a director of Bar 2010 Limited. At the year end an amount of £3,203 (2022: £3,203) was due from Bar 2010 Limited.

Management charges of £3,016,429 (2022: £2,823,470) were charged from the company's trading partner, Procap Services Limited, during the year. At the year end there was £nil (2022: £nil) due to Procap Services Limited included within trade creditors and £85,033 (2022: £434,274) due from Procap Services Limited included within other debtors.

During the prior year, Procap took on a loan from Henry Construction Limited, payable to Bar 2064. At year end, the loan balance was £nil (2022: £340,968).

There is no ultimate controlling party.