Burflex (Scaffolding) Limited - Limited company accounts 23.2

REGISTERED NUMBER: 04844360 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements

for the Year Ended 31st July 2023

for

Burflex (Scaffolding) Ltd

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Statement of Comprehensive Income

10

Balance Sheet

11

Statement of Changes in Equity

12

Cash Flow Statement

13

Notes to the Cash Flow Statement

14

Notes to the Financial Statements

16

DIRECTORS:

S Cox

Mrs T A Cox

SECRETARY:

Mrs T A Cox

REGISTERED OFFICE:

Burflex House

Clay Street

Hull

HU8 8HA

REGISTERED NUMBER:

04844360 (England and Wales)

AUDITORS:

Sadofskys

Statutory Auditors

Princes House

Wright Street

Hull

East Yorkshire

HU2 8HX

BANKERS:

NatWest Bank plc

1 Humber Quays

Wellington Street West

Hull

HU1 2DG

The directors present their strategic report for the year ended 31st July 2023.

REVIEW OF BUSINESS

The key performance indicators of turnover, turnover growth, gross profit and net profit before taxation communicate the financial performance of the company as a whole.

The key performance indicators for the last 3 years are as follows:

2023

2022

2021

as restated

as restated

£

£

£

Turnover

15,158,846

10,863,417

9,782,099

Turnover growth %

39.5%

11.1%

30.2%

GP Margin %

83.5%

91.6%

87.6%

Profit before taxation

2,963,372

1,907,145

1,185,126

The company has significantly increased turnover through further expansion into the commercial sector of the market. This has been achieved through growth with existing customers and also new customers in the commercial sector.

The company continues to maintain sufficient cash reserves to cope with the level of the company's growth and maintains a healthy financial position at the year end.

The directors are satisfied with the trading results for the year.

PRINCIPAL RISKS AND UNCERTAINTIES

The company's principal financial instruments comprise bank balances, trade debtors and trade creditors. The main purpose of these instruments is to raise funds and finance the company's operations.

Price risk

The company is a supplier and installer of scaffolding. The prices of the services provided are based/reduced on account of pricing pressure and competition. This risk is managed by monitoring the market continuously.

Foreign exchange risk

The company is not affected by foreign currency transactions.

Credit risk

Credit checks are carried out on all customers. Amounts outstanding for both time and credit limits are regularly monitored. The company does experience bad debts but believes it has systems in place to mitigate these risks.

Liquidity risk

The company's liquidity risk is managed by ensuring that sufficient funds are available to meet amounts due and the company does not consider that liquidity poses a significant risk.

Interest rate and cash flow risk

The company had a favourable cash balance during the year and therefore does not consider that interest rates or cash flow pose a significant risk.

FUTURE DEVELOPMENTS

The company continues with its strategy to expand further into the commercial sector of the market whilst continuing to supply the domestic housing market.

The company has won significant commercial and housebuilding contracts which will be completed in the 2024 accounts.

The construction industry continues to suffer from supply shortages and difficulties, however the investments that the company has made in equipment and ongoing improvements to its operating systems means that the company remains in a good financial and operating position moving forwards.

ON BEHALF OF THE BOARD:

S Cox - Director

29th April 2024

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

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the supply and fixing of scaffolding.

DIVIDENDS

An interim dividend of £1230 per share was paid on 6th April 2023. The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31st July 2023 will be £ 123,000 .

FUTURE DEVELOPMENTS

These details have been provided in the company's strategic report.

DIRECTORS

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

S Cox

Mrs T A Cox

FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The company's principal financial instruments comprise bank balances, trade debtors and trade creditors. The main purpose of these instruments is to raise funds and finance the company's operations.

Revenue maintenance

The company actively markets and manages its portfolio of products to focus on revenue building and maintenance which, over the life cycle of the products, can contribute to the future profits of the business.

Risks and uncertainties

These details have been provided in the company's strategic report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with 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.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website.

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, Sadofskys, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

S Cox - Director

29th April 2024

Opinion

We have audited the financial statements of Burflex (Scaffolding) Ltd (the 'company') for the year ended 31st July 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 31st July 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 Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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

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

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

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

Responsibilities of directors

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

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

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

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

- we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the construction industry;

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, UK taxation legislation, and data protection, anti-bribery, employment, environmental, and health and safety legislation, along with industry specific regulations and requirements;

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

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

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

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

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

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

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

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

- investigated the rationale behind significant or unusual transactions.

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

- agreeing financial statement disclosures to underlying supporting documentation;

- reading the minutes of meetings of those charged with governance;

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

- reviewing correspondence with HMRC, relevant regulators and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Alan Brocklehurst (Senior Statutory Auditor)

for and on behalf of Sadofskys

Statutory Auditors

Princes House

Wright Street

Hull

East Yorkshire

HU2 8HX

29th April 2024

TURNOVER

15,158,846

10,863,417

Cost of sales

1,271,697

542,293

GROSS PROFIT

13,887,149

10,321,124

Administrative expenses

10,859,241

8,363,070

3,027,908

1,958,054

Other operating income

5,499

5,478

OPERATING PROFIT

4

3,033,407

1,963,532

Interest receivable and similar income

1,538

28

3,034,945

1,963,560

Interest payable and similar expenses

5

71,573

56,415

PROFIT BEFORE TAXATION

2,963,372

1,907,145

Tax on profit

6

612,736

423,910

PROFIT FOR THE FINANCIAL YEAR

2,350,636

1,483,235

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

2,350,636

1,483,235

Prior year adjustment

8

155,245

(25,816

)

TOTAL COMPREHENSIVE INCOME SINCE LAST ANNUAL REPORT

2,505,881

1,457,419

FIXED ASSETS

Tangible assets

9

6,836,462

5,865,427

5,948,068

CURRENT ASSETS

Debtors

10

2,672,418

2,111,502

1,203,212

Cash at bank

503,751

374,898

321,469

3,176,169

2,486,400

1,524,681

CREDITORS

Amounts falling due within one year

11

(2,076,228

)

(2,533,000

)

(2,165,566

)

NET CURRENT ASSETS/(LIABILITIES)

1,099,941

(46,600

)

(640,885

)

TOTAL ASSETS LESS CURRENT LIABILITIES

7,936,403

5,818,827

5,307,183

CREDITORS

Amounts falling due after more than one year

12

(420,395

)

(695,789

)

(1,161,800

)

PROVISIONS FOR LIABILITIES

16

(791,903

)

(626,569

)

(482,149

)

NET ASSETS

6,724,105

4,496,469

3,663,234

CAPITAL AND RESERVES

Called up share capital

17

100

100

100

Retained earnings

6,724,005

4,496,369

3,663,134

SHAREHOLDERS' FUNDS

6,724,105

4,496,469

3,663,234

The financial statements were approved by the Board of Directors and authorised for issue on 29th April 2024 and were signed on its behalf by:

S Cox - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1st August 2021

100

3,688,950

3,689,050

Prior year adjustment

-

(25,816

)

(25,816

)

As restated

100

3,663,134

3,663,234

Changes in equity

Dividends

-

(650,000

)

(650,000

)

Total comprehensive income

-

1,327,990

1,327,990

Balance at 31st July 2022

100

4,341,124

4,341,224

Prior year adjustment

-

155,245

155,245

As restated

100

4,496,369

4,496,469

Changes in equity

Dividends

-

(123,000

)

(123,000

)

Total comprehensive income

-

2,350,636

2,350,636

Balance at 31st July 2023

100

6,724,005

6,724,105

Cash flows from operating activities

Cash generated from operations

1

3,999,865

1,804,068

Interest paid

(35,865

)

(7,066

)

Interest element of hire purchase payments paid

(35,708

)

(48,957

)

Tax paid

(325,356

)

(60,000

)

Net cash from operating activities

3,602,936

1,688,045

Cash flows from investing activities

Purchase of tangible fixed assets

(2,233,254

)

(668,476

)

Sale of tangible fixed assets

43,655

-

Interest received

1,538

28

Net cash from investing activities

(2,188,061

)

(668,448

)

Cash flows from financing activities

Loan repayments in year

(141,661

)

(41,540

)

Capital repayments in year

(433,760

)

(640,582

)

Amount introduced by directors

100,000

375,000

Amount withdrawn by directors

(687,601

)

(9,046

)

Equity dividends paid

(123,000

)

(650,000

)

Net cash from financing activities

(1,286,022

)

(966,168

)

Increase in cash and cash equivalents

128,853

53,429

Cash and cash equivalents at beginning of year

2

374,898

321,469

Cash and cash equivalents at end of year

2

503,751

374,898

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2023

2022

as restated

£

£

Profit before taxation

2,963,372

1,907,145

Depreciation charges

1,287,565

983,310

Profit on disposal of fixed assets

(56,120

)

-

Finance costs

71,573

56,415

Finance income

(1,538

)

(28

)

4,264,852

2,946,842

Increase in trade and other debtors

(560,916

)

(908,290

)

Increase/(decrease) in trade and other creditors

295,929

(234,484

)

Cash generated from operations

3,999,865

1,804,068

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31st July 2023

31/7/23

1/8/22

£

£

Cash and cash equivalents

503,751

374,898

Year ended 31st July 2022

31/7/22

1/8/21

as restated

£

£

Cash and cash equivalents

374,898

321,469

3.	ANALYSIS OF CHANGES IN NET DEBT

Other

non-cash

At 1/8/22

Cash flow

changes

At 31/7/23

£

£

£

£

Net cash

Cash at bank

374,898

128,853

503,751

374,898

128,853

503,751

Debt

Finance leases

(515,500

)

433,760

-

(260,325

)

Debts falling due

within 1 year

(142,000

)

-

-

(142,000

)

Debts falling due

after 1 year

(540,626

)

141,661

-

(398,965

)

(1,198,126

)

575,421

-

(801,290

)

Total

(823,228

)

704,274

-

(297,539

)

1.	STATUTORY INFORMATION

Burflex (Scaffolding) Ltd 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.

The presentation currency of the financial statements is the Pound Sterling (£).

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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Tangible fixed assets

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

Freehold property

-

not provided

Improvements to property

-

over the period of the lease

Plant and machinery

-

15% on cost and 10% on cost

Fixtures and fittings

-

20% on cost and 15% on reducing balance

Motor vehicles

-

25% on cost and 25% on reducing balance

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

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.

Going concern

The directors are satisfied that the financial statements have been prepared on the going concern basis, having considered the longevity of its contracts with the existing customer base.

Further information regarding the company's business activities, together with the factors likely to affect its future development, performance and position, is set out in the Strategic Report.

3.	EMPLOYEES AND DIRECTORS

2023

2022

as restated

£

£

Wages and salaries

6,718,889

5,145,223

Social security costs

685,227

532,125

Other pension costs

134,620

104,747

7,538,736

5,782,095

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

2023

2022

as restated

Management and administration

26

26

Drivers and yard

35

28

Site

123

96

184

150

2023

2022

as restated

£

£

Directors' remuneration

23,000

29,204

Directors' pension contributions to money purchase schemes

316

316

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

Money purchase schemes

2

2

4.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2023

2022

as restated

£

£

Hire of plant and machinery

23,468

20,869

Other operating leases

104,562

100,596

Depreciation - owned assets

878,596

681,906

Depreciation - assets on hire purchase contracts

408,969

301,405

Profit on disposal of fixed assets

(56,120

)

-

Auditors' remuneration

5,650

5,700

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

2023

2022

as restated

£

£

Bank interest

8,424

-

Interest on corporation tax

-

392

Loan interest

27,441

7,066

Hire purchase interest

35,708

48,957

71,573

56,415

6.

TAXATION

Analysis of the tax charge

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

2023

2022

as restated

£

£

Current tax:

UK corporation tax

447,402

279,490

Deferred taxation

165,334

144,420

Tax on profit

612,736

423,910