Norse Limited - Limited company accounts 17.3

REGISTERED NUMBER: SC088781 (Scotland)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2017

FOR

NORSE LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Cash Flow Statement

12

Notes to the Cash Flow Statement

13

Notes to the Financial Statements

14

DIRECTORS:

W C Strachan

A Strachan

SECRETARY:

A Strachan

REGISTERED OFFICE:

Broadfold Road

Bridge of Don

Aberdeen

SCOTLAND

AB23 8EE

REGISTERED NUMBER:

SC088781 (Scotland)

SENIOR STATUTORY AUDITOR:

Albert Tiong CA

AUDITORS:

Albert Tiong & Co

Chartered Accountants and

Registered Auditor

53 Wykeham Road

Scotstounhill

Glasgow G13 3YP

BANKERS:

Bank of Scotland

Aberdeen, Tullos Branch

10 Greenwell Road

Aberdeen

AB12 3AZ

The directors present their strategic report for the year ended 31 March 2017.

Company's registered number

The company's registered number is SC88781

REVIEW OF BUSINESS

The results for the year and financial position of the company are as shown in the annexed financial statements. The

profit on ordinary activities for the year before taxation was £231,496 (2016- £838,116). The company experienced

a significant decrease in demand for its specialised piping products as a direct result of lower global crude oil market

prices. Export sales accounted for 29% (2016: 50%) of the company's turnover.

The balance sheet shows the financial position at the end of the year. Overall, the net assets position at the end of

2017 remained significantly strong with the company keeping sufficient funds available for day to day operations

and future expansions.

PRINCIPAL RISKS AND UNCERTAINTIES

The key risks and uncertainties facing the company include the following:

Competition

Risk of losing business to competitors is mitigated by working closely with customers and close monitoring

competitors' prices.

Employees

The company is a people based business. To ensure staff retention, the company operates competitive remuneration

packages for all staff.

Financial risk management

The company has minimal debt finance and its financial instruments comprise cash and short-term deposits and

various items such as trade debtors and trade creditors that arise directly from its activities. The directors are

responsible for managing the company's working capital, liquidity and invest surplus funds.

The company is exposed to the following financial risks:

Price risk

The company is exposed to price risk due to normal inflationary increases in the purchase price of the goods and

services in purchases both in the UK and overseas.

Credit risk

It is the company's policies to perform credit checks on potential customers before sales are made. The amount of

exposure to any customer is subject to a limit, which is assessed annually by the board.

Liquidity and cash flow risks

The company has continued to maintain its working capital by ensuring that customers settle their accounts within

prescribed time limits.

Foreign currency risk

The exposure is minimised by having banking facilities in other major currencies in particular, Euro and Dollars.

Crude Oil Prices

With continued low prices, this affects the demand for the company products

ON BEHALF OF THE BOARD:

A Strachan - Secretary

31 December 2017

The directors present their report with the financial statements of the company for the year ended 31 March 2017.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the supply of steel products and related

materials for construction of high pressure piping systems offshore. In the year under review, there were no

significant changes to the company's principal activities.

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2017.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2016 to the date of this

report.

W C Strachan

A Strachan

POLITICAL DONATIONS AND EXPENDITURE

During the year, the company made charitable donations amounting to £28,140 (2016 - £23,367). Among the

charities that benefited included those concerned with cancer research £26,830 (2016 - £16,160) and local charitable

communities £1,310 (2016 - £7,207)

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.

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, Albert Tiong & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

A Strachan - Secretary

31 December 2017

We have audited the financial statements of Norse Limited for the year ended 31 March 2017 on pages eight to

twenty. The financial reporting framework that has been applied in their preparation is applicable law and United

Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial

Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.

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.

Respective responsibilities of directors and auditors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give

reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or

error. This includes an assessment of: whether the accounting policies are appropriate to the company's

circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant

accounting estimates made by the directors; and the overall presentation of the financial statements. In addition, we

read all the financial and non-financial information in the Strategic Report and the Report of the Directors to identify

material inconsistencies with the audited financial statements and to identify any information that is apparently

materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of

performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the

implications for our report.

Opinion on financial statements

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 March 2017 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.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our 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 has been prepared in accordance with applicable legal requirements. In

the light of the knowledge and understanding of the company and its environment, we have not identified any

material misstatements in the Strategic Report or the Report of the Directors.

Matters on which we are required to report by exception

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.

Albert Tiong CA (Senior Statutory Auditor)

for and on behalf of Albert Tiong & Co

Chartered Accountants and

Registered Auditor

53 Wykeham Road

Scotstounhill

Glasgow G13 3YP

31 December 2017

TURNOVER

3

4,883,426

6,989,956

Cost of sales

3,277,570

4,732,968

GROSS PROFIT

1,605,856

2,256,988

Administrative expenses

1,381,567

1,437,478

224,289

819,510

Other operating income

7,200

20,000

OPERATING PROFIT

5

231,489

839,510

Interest receivable and similar income

7

16

231,496

839,526

Interest payable and similar expenses

6

-

1,410

PROFIT BEFORE TAXATION

231,496

838,116

Tax on profit

7

57,228

177,379

PROFIT FOR THE FINANCIAL YEAR

174,268

660,737

PROFIT FOR THE YEAR

174,268

660,737

OTHER COMPREHENSIVE INCOME

Transfer from revaluation reserve

-

1,251

Income tax relating to other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

1,251

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

174,268

661,988

FIXED ASSETS

Tangible assets

9

246,728

310,013

CURRENT ASSETS

Stocks

10

651,726

996,488

Debtors

11

3,004,407

2,747,329

Cash at bank and in hand

799,105

843,924

4,455,238

4,587,741

CREDITORS

Amounts falling due within one year

12

880,987

1,248,497

NET CURRENT ASSETS

3,574,251

3,339,244

TOTAL ASSETS LESS CURRENT LIABILITIES

3,820,979

3,649,257

PROVISIONS FOR LIABILITIES

13

6,133

8,679

NET ASSETS

3,814,846

3,640,578

CAPITAL AND RESERVES

Called up share capital

14

1,000

1,000

Retained earnings

15

3,813,846

3,639,578

SHAREHOLDERS' FUNDS

3,814,846

3,640,578

The financial statements were approved by the Board of Directors on 31 December 2017 and were signed on its behalf by:

A Strachan - Director

W C Strachan - Director

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 April 2015

1,000

3,978,841

(1,251

)

3,978,590

Changes in equity

Dividends

-

(1,000,000

)

-

(1,000,000

)

Total comprehensive income

-

660,737

1,251

661,988

Balance at 31 March 2016

1,000

3,639,578

-

3,640,578

Changes in equity

Total comprehensive income

-

174,268

-

174,268

Balance at 31 March 2017

1,000

3,813,846

-

3,814,846

Cash flows from operating activities

Cash generated from operations

1

403,300

27,383

Interest element of hire purchase or finance lease rental payments paid

-

(1,410

)

Tax paid

(52,398

)

(211,996

)

Net cash from operating activities

350,902

(186,023

)

Cash flows from investing activities

Purchase of tangible fixed assets

-

(27,456

)

Sale of tangible fixed assets

36,000

79,919

Sale of investment property

-

161,027

Interest received

7

16

Net cash from investing activities

36,007

213,506

Cash flows from financing activities

Capital repayments in year

-

(25,890

)

Funds undrawn by directors

-

416,031

Amount withdrawn by directors

(431,728

)

-

Equity dividends paid

-

(1,000,000

)

Net cash from financing activities

(431,728

)

(609,859

)

Decrease in cash and cash equivalents

(44,819

)

(582,376

)

Cash and cash equivalents at beginning of year

2

843,924

1,426,300

Cash and cash equivalents at end of year

2

799,105

843,924

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

2017

2016

£

£

Profit before taxation

231,496

838,116

Depreciation charges

38,391

54,425

Profit on disposal of fixed assets

(11,106

)

(16,936

)

Revaluation reserve transfer

-

1,251

Finance costs

-

1,410

Finance income

(7

)

(16

)

258,774

878,250

Decrease in stocks

344,762

334,231

(Increase)/decrease in trade and other debtors

(257,078

)

230,961

Increase/(decrease) in trade and other creditors

56,842

(1,416,059

)

Cash generated from operations

403,300

27,383

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 31 March 2017

31/3/17

1/4/16

£

£

Cash and cash equivalents

799,105

843,924

Year ended 31 March 2016

31/3/16

1/4/15

£

£

Cash and cash equivalents

843,924

1,426,300

1.	STATUTORY INFORMATION

Norse Limited is a private company, limited by shares , registered in Scotland. The company's registered

number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" 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.

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from

changes in fair value is recognised in profit or loss.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and

slow moving items.

Taxation

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

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:

2017

2016

£

£

United Kingdom & Europe

3,541,728

3,786,974

USA and rest of the world

1,341,698

3,202,982

4,883,426

6,989,956

4.	EMPLOYEES AND DIRECTORS

2017

2016

£

£

Wages and salaries

739,859

762,101

Social security costs

84,944

92,211

Other pension costs

31,069

42,118

855,872

896,430

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

2017

2016

Administration

17

17

2017

2016

£

£

Directors' remuneration

165,278

203,602

5.	OPERATING PROFIT

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

2017

2016

£

£

Other operating leases

180,579

143,772

Depreciation - owned assets

38,391

54,425

Profit on disposal of fixed assets

(11,106

)

(16,936

)

Auditors' remuneration

8,500

8,500

Foreign exchange differences

766

12,188

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2017

2016

£

£

Hire purchase

-

1,410

7.

TAXATION

Analysis of the tax charge

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

2017

2016

£

£

Current tax:

UK corporation tax

59,774

178,264

Deferred tax

(2,546

)

(885

)

Tax on profit

57,228

177,379

UK corporation tax has been charged at 20% (2016 - 20%).

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is

explained below:

2017

2016

£

£

Profit before tax

231,496

838,116

Profit multiplied by the standard rate of corporation tax in the UK of 20% (2016 - 20%)

46,299

167,623

Effects of:

Expenses not deductible for tax purposes

10,355

11,756

Income not taxable for tax purposes

(158

)

(71

)

Capital allowances in excess of depreciation

-

(1,044

)

Depreciation in excess of capital allowances

3,278

-

Decrease in deferred tax

(2,546

)

(885

)

Total tax charge

57,228

177,379

Tax effects relating to effects of other comprehensive income

There were no tax effects for the year ended 31 March 2017.

2016

Gross

Tax

Net

£

£

£

Transfer from revaluation reserve

1,251

-

1,251

UK Corporation tax was charged at 20% (2016- 20%)

8.

DIVIDENDS

2017

2016

£

£

Ordinary shares of £1 each

Final dividend - Ord share

-

500,000

Interim div - Ord share

-

500,000

-

1,000,000

9.	TANGIBLE FIXED ASSETS

Improvements

Short

to

Plant and

leasehold

property

machinery

£

£

£

COST

At 1 April 2016

149,944

32,906

152,303

At 31 March 2017

149,944

32,906

152,303

DEPRECIATION

At 1 April 2016

63,000

10,911

91,246

Charge for year

3,000

658

9,158

Eliminated on disposal

-

-

-

At 31 March 2017

66,000

11,569

100,404

NET BOOK VALUE

At 31 March 2017

83,944

21,337

51,899

At 31 March 2016

86,944

21,995

61,057