A1 Comms Limited - Period Ending 2014-03-31

Registration number: 04455131

A1 Comms Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 31 March 2014
 

A1 Comms Limited
Contents

Company Information 1

Strategic Report 2 to 3

Directors' Report 4 to 5

Independent Auditor's Report 6 to 7

Consolidated Profit and Loss Account 8

Consolidated Balance Sheet 9

Balance Sheet 10

Consolidated Cash Flow Statement 11 to 12

Notes to the Financial Statements 13 to 35

A1 Comms Limited
Company Information

Directors

P Sisson A Sisson P Gadsby

Registered office

Contract House Turnpike Business Park Alfreton Derbyshire DE55 7AD

Bankers

Handelsbanken 4 Pinnacle Way Pride Park Derby DE24 8ZS

Auditors

Ashgates Corporate Services Limited Registered Auditors 5 Prospect Place Millennium Way Pride Park Derby DE24 8HG

Page 1

A1 Comms Limited
Strategic Report for the Year Ended 31 March 2014

The directors present their strategic report for the year ended 31 March 2014.

Business review

Fair review of the business

2013/14 was another strong year for A1 Comms in which turnover and EBITDA were maintained whilst the integration of the retail operation was finalised.

Gross profit grew healthily due to organic sales growth online and continued improvements in retail capability. The company was restructured in Q4 resulting in salary and overhead savings for the following financial year.

The group's key financial and other performance indicators during the year were as follows:

	Unit	2014	2013
Turnover	£,000	110,817	116,295
EBITDA	£,000	2,225	2,042

The following year will continue the focus upon consolidation, realigning costs and updating of the business infrastructure. We will look at opportunities for increasing our retail outlets whilst maintaining the strong relationships we have with our partners and suppliers.

Principal risks and uncertainties

The market continues to be competitive across phone networks and retailers. The increasing market share and development of smartphones requires a larger investment in phone purchases as consumers continue their demand for higher specification devices. Against this background however, the group is well placed to take advantage of its historic success and understanding of the market.

The company has key relationships with certain mobile network operators and suppliers. The company has moved to establish strong working and commercial relationships with these networks and suppliers to be able to drive economic value for them and to ensure the best possible offers are made to consumers.

Price risk, credit risk, liquidity risk and cash flow risk

Credit risk

The company's credit risk is primarily attributed to its trade receivables. The amounts presented in the balance sheet are net of projected clawbacks and any provision for doubtful debts. A provision for doubtful debts is made where, it is considered that the full receivable amount may not be recovered.

Liquidity risk

In respect of bank balances, the liquidity risk is managed by maintaining a balance between the continuity of
funding and flexibility through the use of overdrafts at floating rates of interest.

Trade creditors' liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.

Loans comprise loans from the directors and from financial institutions. The interest rate on loans from financial institutions are a mixture of fixed and variable, but the monthly repayments are fixed. The business manages the liquidity risk by ensuring that there are sufficient funds to meet the payments.

Page 2

A1 Comms Limited
Strategic Report for the Year Ended 31 March 2014
......... continued

Approved by the Board on 16 January 2015 and signed on its behalf by:

.........................................
P Sisson
Director

Page 3

A1 Comms Limited
Directors' Report for the Year Ended 31 March 2014

The directors present their report and the consolidated financial statements for the year ended 31 March 2014.

Directors of the company

The directors who held office during the year were as follows:

P Sisson

A Sisson

C A Garrett (resigned 13 November 2013)

The following director was appointed after the year end:

P Gadsby (appointed 24 September 2014)

Directors' responsibilities

The directors are responsible for preparing the Directors' Report 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

group and the

company and of the profit or loss of the

group

for that period. In preparing these financial statements, the

directors are

required to:
•
select suitable accounting policies and 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; and
•
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

group's and the

company's transactions and disclose with reasonable accuracy at any time the financial position of the

group and 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

group and the

company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Principal activity

The principal activity of the group is that of the retail sale of mobile communication products and services.

Disclosure of information to the auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the group's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and which they know the auditor is unaware of.

Page 4

A1 Comms Limited
Directors' Report for the Year Ended 31 March 2014
......... continued

Approved by the Board on 16 January 2015 and signed on its behalf by:

.........................................
P Sisson
Director

Page 5

Independent Auditor's Report to the Members of
A1 Comms Limited

We have audited the financial statements of A1 Comms Limited for the year ended 31 March 2014, set out on pages 8 to 35. 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).

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.

Respective responsibilities of directors and auditor

As explained more fully in the Directors' Report (set out on page 4), 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 (APB’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 group's and parent 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 Annual Reportand Consolidated Financial Statements 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 group's and of the parent company's affairs as at

31 March 2014

and of the group's

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 the information given in the Directors' Report and Strategic Report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Page 6

Independent Auditor's Report to the Members of
A1 Comms Limited
 
 ......... continued

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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
•	the parent company 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.

......................................
Andrew Westhead Lyon (Senior Statutory Auditor)
For and on behalf of Ashgates Corporate Services Limited, Statutory Auditor

5 Prospect Place
Millennium Way
Pride Park
Derby
DE24 8HG

16 January 2015

Page 7

A1 Comms Limited
Consolidated Profit and Loss Account for the Year Ended 31 March 2014

		Note			2014 £			2013 £
Turnover		2			110,817,274			116,295,351
Cost of sales					(95,314,118)			(103,612,757)
Gross profit					15,503,156			12,682,594
Administrative expenses					(15,216,113)			(12,295,970)
Other operating income					1,029,302			939,127
Group operating profit		3			1,316,345			1,325,751
Other interest receivable and similar income		7			55,818			45,795
Interest payable and similar charges		8			(483,323)			(190,634)
Profit on ordinary activities before taxation					888,840			1,180,912
Tax on profit on ordinary activities		9			(255,524)			(212,046)
Profit for the financial year attributable to members of the parent company		20			633,316			968,866

Turnover and operating profit derive wholly from continuing operations.

The group has no recognised gains or losses for the year other than the results above.

The notes on pages 13 to 35 form an integral part of these financial statements.
Page 8

A1 Comms Limited
Consolidated Balance Sheet at 31 March 2014

		Note			2014						2013
	£			£			£			£
Fixed assets
Intangible fixed assets		10						2,340,274						3,089,470
Tangible fixed assets		11						1,621,282						1,556,283
Current assets
Stocks		13			1,915,252						2,485,271
Debtors within one year		14			14,947,378						19,429,535
Debtors over one year		14			4,539,829						5,855,981
Cash at bank and in hand					169,972						1,314,935
					21,572,431						29,085,722
Creditors: Amounts falling due within one year		15			(15,450,954)						(23,678,757)
Net current assets								6,121,477						5,406,965
Total assets less current liabilities								10,083,033						10,052,718
Creditors: Amounts falling due after more than one year		16						(3,309,899)						(2,843,409)
Provisions for liabilities		17						(2,737,823)						(3,807,314)
Net assets								4,035,311						3,401,995
Capital and reserves
Called up share capital		18			1,000						100
Profit and loss account		20			4,055,679						3,423,263
Shareholders' funds		21			4,056,679						3,423,363
Minority interest					(21,368)						(21,368)
Capital employed								4,035,311						3,401,995

Approved and authorised for issue by the Board on 16 January 2015 and signed on its behalf by:

.........................................
P Sisson
Director

The notes on pages 13 to 35 form an integral part of these financial statements.
Page 9

A1 Comms Limited
(Registration number: 04455131)
Balance Sheet at 31 March 2014

		Note			2014 £			2013 £
Fixed assets
Intangible fixed assets		10			706,673			984,315
Tangible fixed assets		11			1,506,559			1,476,677
Investments		12			78			78
					2,213,310			2,461,070
Current assets
Stocks		13			1,900,947			2,483,257
Debtors within one year		14			14,302,440			19,439,961
Debtors over one year		14			4,539,829			5,855,981
Cash at bank and in hand					158,556			1,307,436
					20,901,772			29,086,635
Creditors: Amounts falling due within one year		15			(13,868,615)			(22,084,589)
Net current assets					7,033,157			7,002,046
Total assets less current liabilities					9,246,467			9,463,116
Creditors: Amounts falling due after more than one year		16			(3,309,899)			(2,843,409)
Provisions for liabilities		17			(2,723,481)			(3,807,314)
Net assets					3,213,087			2,812,393
Capital and reserves
Called up share capital		18			1,000			100
Profit and loss account		20			3,212,087			2,812,293
Shareholders' funds		21			3,213,087			2,812,393

Approved and authorised for issue by the Board on 16 January 2015 and signed on its behalf by:

.........................................
P Sisson
Director

The notes on pages 13 to 35 form an integral part of these financial statements.
Page 10

A1 Comms Limited
Consolidated Cash Flow Statement for the Year Ended 31 March 2014

Reconciliation of operating profit to net cash flow from operating activities

		2014 £			2013 £
Operating profit		1,316,345			1,325,751
Depreciation, amortisation and impairment charges		908,477			716,740
Decrease/(increase) in stocks		570,019			(735,434)
Decrease/(increase) in debtors		5,798,309			(11,556,416)
(Decrease)/increase in creditors		(8,153,467)			15,829,371
Decrease in provisions		(1,103,915)			(174,028)
Net cash (outflow)/inflow from operating activities		(664,232)			5,405,984

Cash flow statement

		2014 £			2013 £
Net cash (outflow)/inflow from operating activities		(664,232)			5,405,984
Returns on investments and servicing of finance
Interest received		55,818			45,795
HP and finance lease interest		(5,680)			(1,652)
Interest paid		(477,643)			(188,982)
		(427,505)			(144,839)
Tax paid		(338,405)			(214,116)
Capital expenditure and financial investment
Purchase of intangible fixed assets		-			(3,302,015)
Purchase of tangible fixed assets		(186,880)			(395,304)
		(186,880)			(3,697,319)
Equity dividends paid		-			(336,000)
Net cash (outflow)/inflow before management of liquid resources and financing		(1,617,022)			1,013,710
Financing
Value of new loans obtained during the period		750,000			-
Repayment of loans and borrowings		(80,600)			(60,450)
Repayment of capital element of finance leases and HP contracts		(44,176)			(16,704)
		625,224			(77,154)
(Decrease)/increase in cash		(991,798)			936,556

The notes on pages 13 to 35 form an integral part of these financial statements.
Page 11

A1 Comms Limited
Consolidated Cash Flow Statement for the Year Ended 31 March 2014......... continued

Reconciliation of net cash flow to movement in net debt

		Note			2014 £			2013 £
(Decrease)/increase in cash					(991,798)			936,556
Cash inflow from increase in loans					(750,000)			-
Cash outflow from repayment of loans					80,600			60,450
Cash outflow from repayment of capital element of finance leases and hire purchase contracts					44,176			16,704
Change in net debt resulting from cash flows		24			(1,617,022)			1,013,710
New finance leases					(37,400)			(69,223)
Movement in net debt		24			(1,654,422)			944,487
Net funds/(debt) at 1 April		24			433,728			(510,759)
Net (debt)/funds at 31 March		24			(1,220,694)			433,728

The notes on pages 13 to 35 form an integral part of these financial statements.
Page 12

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

1	Accounting policies

Basis of preparation

The financial statements have been prepared under the historical cost convention and in accordance with applicable accounting standards.

Basis of consolidation

The group financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 March 2014. Subsidiary undertakings are included using the acquisitions method of accounting. Under this method the group profit and loss account and statement of cashflows include the results and cashflows of subsidiaries from the date of acquisition and to the date of sale outside the group in the case of disposals of subsidiaries. The purchase consideration has been allocated to the assets and liabilities on the basis of fair value at the date of acquisition.

No profit and loss account is presented for the company as permitted by Section 408 of the Companies Act 2006. Its profit for the financial year was £400,694 (2013 - £488,120).

Going concern

The directors, in their consideration of going concern, have reviewed the company's future cash forecasts and revenue projections, which they believe are based on prudent market data and past experience. The directors are of the opinion that the company's forecasts and projections, which reflect the current economic outlook and take account of reasonable possible changes in trading performance and continued good relationships with the mobile network operators, show that the company should be able to operate within its current facilities.

Based on the above the directors have a reasonable expectation that the company has adequate resources to continue in operation for the foreseeable future and consequently the directors continue to adopt the going concern basis in the preparation of the financial statements.

Turnover

Turnover is stated net of VAT and other sales related taxes. Turnover comprises of revenue generated from the sale of mobile communication products and services, commission receivable on sales, ongoing revenue and insurance premiums. Commission receivable on sales, being commission which is contractually committed, and for which there are no ongoing performance criteria, is recognised when the sales to which the commission relates are made. Other ongoing revenue is recognised as it is received over the lives of the relevant customers. All other revenue is recognised when the relevant goods or services are provided. Where the time value of money has an impact, an appropriate discount is applied such that revenue is recognised at an amount equal to the present value of the future consideration received. The unwinding of the discount is recognised within finance income.

Page 13

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Goodwill

Goodwill is the difference between the fair value of consideration paid for an acquired entity and the aggregate of the fair value of that entity's identifiable assets and liabilities.

Positive goodwill is capitalised, classified as an asset on the balance sheet and amortised on a straight line basis over its useful economic life. It is reviewed for impairment at the end of the first full financial year following the acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable.

Amortisation

Amortisation is provided on intangible fixed assets so as to write off the cost, less any estimated residual value, over their useful economic life as follows

Asset class	Amortisation method and rate
Goodwill - on consolidation	5% straight line basis
Goodwill - purchased	20% and 33% straight line basis

Depreciation

Tangible fixed assets are initially recorded at cost. Depreciation is provided on tangible fixed assets so as to write off the cost or valuation, less any estimated residual value, over their expected useful economic life as follows:

Asset class	Depreciation method and rate
Freehold buildings	2% straight line basis
Fixtures and fittings	15% reducing balance basis
Motor vehicles	20% reducing balance basis
Office equipment	33% straight line basis
Website	33% straight line basis
Land	No depreciation charged

Research and development

Research expenditure is written off to the profit and loss account in the year in which it is incurred.

Fixed asset investments

Fixed asset investments are stated at historical cost less provision for any diminution in value.

Stock

Stock is valued at the lower of cost and net realisable value, after due regard for obsolete and slow moving stocks. Net realisable value is based on selling price less anticipated costs to completion and selling costs.

Deferred tax

Deferred tax is recognised, without discounting, in respect of all timing differences between the treatment of certain items for taxation and accounting purposes, which have arisen but not reversed by the balance sheet date, with certain limited exceptions as required by the Financial Reporting Standard 19. Deferred tax is measured at the rates that are expected to apply in the periods when the timing differences are expected to reverse, based on the tax rates and law enacted at the balance sheet date.

Page 14

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Hire purchase and leasing

Rentals payable under operating leases are charged in the profit and loss account on a straight line basis over the lease term.

Assets held under finance leases, which are leases where substantially all the risks and rewards of ownership of the asset have passed to the group, are capitalised in the balance sheet as tangible fixed assets and are depreciated over the shorter of the lease term and their useful lives. The capital elements of future obligations under the leases are included as liabilities in the balance sheet. The interest element of the rental obligation is charged to the profit and loss account over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding. Assets held under hire purchase agreements are capitalised as tangible fixed assets and are depreciated over their useful lives. The capital element of future finance payments is included within creditors. Finance charges are allocated to accounting periods over the length of the contract and represent a constant proportion of the balance of capital repayments outstanding.

Pensions

The group operates a defined contribution pension scheme. Contributions are recognised in the profit and loss account in the period in which they become payable in accordance with the rules of the scheme.

Share based payments

The company has issued equity settled payments to certain employees under a long term incentive plan. The value of the plan is measured at the fair value at the date of the grant. The fair value is then recognised as an employee cost, with a corresponding increase in equity over the vesting period based on the company's estimate of the number of shares that will vest.

2

Turnover

An analysis of turnover by class of business is given below:

		2014 £			2013 £
Sales		107,471,040			112,861,455

Commissions receivable		3,195,816			3,213,062

Franchise fees		150,418			220,834

		110,817,274			116,295,351

3	Operating profit

Operating profit is stated after charging:

		2014 £			2013 £
Operating leases - other assets		1,376,800			1,400,721
Depreciation of owned assets		135,272			61,310
Depreciation of assets held under finance lease and hire purchase contracts		24,009			18,457
Amortisation		749,196			636,973
Auditor's remuneration		71,175			66,960

Page 15

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

4	Auditor's remuneration

		2014 £			2013 £
Audit of the financial statements		37,000			33,000
Other fees to auditors
The audit of the company's subsidiaries' annual accounts		7,400			6,860
Tax services		4,500			4,250
Other services		22,275			22,850
		34,175			33,960
		71,175			66,960

5	Particulars of employees

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

		2014 No.			2013 No.
Directors		3			3
Management, administration and support		80			76
Sales, marketing and distribution		78			58
Other departments		29			22
		190			159

The aggregate payroll costs were as follows:

		2014 £			2013 £
Wages and salaries		4,970,152			3,640,048
Social security costs		412,133			298,024
Staff pensions		21,614			15,332
		5,403,899			3,953,404

During the year the company introduced an EMI scheme which aims to provide long term incentives to certain employees. The scheme comprises share options which vest upon the listing or trade sale of the company. The company has issued options on 3,868 shares and they can be exercised by the employees at a cost of £275 if exercised before 31 December 2015 and £760 if after 31 December 2015. As at the year end none of the options have been exercised.

During the year the company recognised non-cash accounting charge in profit and loss of £nil (2013 - £nil).

Page 16

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

6	Directors' remuneration

The directors' remuneration for the year was as follows:

		2014 £			2013 £
Remuneration (including benefits in kind)		79,257			30,440

7	Other interest receivable and similar income

		2014 £			2013 £
Bank interest receivable		505			893
Other interest receivable		-			19
Other finance income		55,313			44,883
Group interest receivable		55,818			45,795

8	Interest payable and similar charges

		2014 £			2013 £
Interest on bank borrowings		27,332			65,319
Interest on other loans		88,500			-
Other interest payable		115,542			28,922
Finance charges		251,949			96,393
Group interest payable and similar charges		483,323			190,634

Page 17

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

9

Taxation

Tax on profit on ordinary activities

		2014 £			2013 £
Current tax
Corporation tax charge		248,397			205,034
Adjustments in respect of previous years		(27,297)			(13,351)
UK Corporation tax		221,100			191,683
Deferred tax
Origination and reversal of timing differences		15,971			14,250
Deferred tax adjustment relating to previous years		18,453			6,113
Group deferred tax		34,424			20,363
Total tax on profit on ordinary activities		255,524			212,046

Factors affecting current tax charge for the year

Tax on profit on ordinary activities for the year is higher than (2013 - lower than) the standard rate of corporation tax in the UK of 23% (2013 - 24%).

The differences are reconciled below:

		2014 £			2013 £
Profit on ordinary activities before taxation		888,840			1,180,912
Corporation tax at standard rate		204,433			283,419
Capital allowances in excess of depreciation		(28,339)			(12,617)
Expenses not deductible for tax purposes		72,302			19,095
Adjustment in respect of prior year		(27,296)			(13,351)
Research and development claim		-			(81,976)
Marginal relief		-			(2,887)
Total current tax		221,100			191,683

Page 18

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

10	Intangible fixed assets

Group

		Goodwill £			Development costs £			Total £
Cost
At 1 April 2013		3,913,282			10			3,913,292
At 31 March 2014		3,913,282			10			3,913,292
Amortisation
At 1 April 2013		823,822			-			823,822
Charge for the year		749,196			-			749,196
At 31 March 2014		1,573,018			-			1,573,018
Net book value
At 31 March 2014		2,340,264			10			2,340,274
At 31 March 2013		3,089,460			10			3,089,470

Company

		Goodwill £			Development costs £			Total £
Cost
At 1 April 2013		1,388,212			10			1,388,222
At 31 March 2014		1,388,212			10			1,388,222
Amortisation
At 1 April 2013		403,907			-			403,907
Charge for the year		277,642			-			277,642
At 31 March 2014		681,549			-			681,549
Net book value
At 31 March 2014		706,663			10			706,673
At 31 March 2013		984,305			10			984,315

Page 19

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

11	Tangible fixed assets

Group

		Freehold land and buildings £			Fixtures and fittings £			Motor vehicles £			Office equipment £			Other tangibles £			Total £
Cost or valuation
At 1 April 2013		1,238,650			55,075			121,173			367,559			62,191			1,844,648
Additions		-			61,256			-			117,359			45,665			224,280
At 31 March 2014		1,238,650			116,331			121,173			484,918			107,856			2,068,928
Depreciation
At 1 April 2013		40,196			20,086			5,982			205,695			16,406			288,365
Charge for the year		8,775			5,248			23,038			88,634			33,586			159,281
At 31 March 2014		48,971			25,334			29,020			294,329			49,992			447,646
Net book value
At 31 March 2014		1,189,679			90,997			92,153			190,589			57,864			1,621,282
At 31 March 2013		1,198,454			34,989			115,191			161,864			45,785			1,556,283

Page 20

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Leased assets

Included within the net book value of tangible fixed assets is £118,007 (2013 - £119,915) in respect of assets held under finance leases and similar hire purchase contracts. Depreciation for the year on these assets was £24,009 (2013 - £18,457).

Freehold land

Included within freehold land and buildings is freehold land of £318,000 (2012 - £318,000) which is not depreciated.

Page 21

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Company

		Freehold land and buildings £			Fixtures and fittings £			Motor vehicles £			Office equipment £			Other tangibles £			Total £
Cost or valuation
At 1 April 2013		1,238,650			32,835			121,173			295,600			78,990			1,767,248
Additions		-			-			-			115,329			45,665			160,994
At 31 March 2014		1,238,650			32,835			121,173			410,929			124,655			1,928,242
Depreciation
At 1 April 2013		40,196			18,255			5,982			192,933			33,205			290,571
Charge for the year		8,775			2,187			23,038			63,526			33,586			131,112
At 31 March 2014		48,971			20,442			29,020			256,459			66,791			421,683
Net book value
At 31 March 2014		1,189,679			12,393			92,153			154,470			57,864			1,506,559
At 31 March 2013		1,198,454			14,580			115,191			102,667			45,785			1,476,677

Page 22

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Leased assets

Included within the net book value of tangible fixed assets is £118,007 (2013 - £119,915) in respect of assets held under finance leases and similar hire purchase contracts. Depreciation for the year on these assets was £24,009 (2013 - £18,457).

Freehold land

Included within freehold land and buildings is freehold land of £318,000 (2012 - £318,000) which is not depreciated.

12	Investments held as fixed assets

Company

		2014 £			2013 £
Shares in group undertakings and participating interests		78			78

Shares in group undertakings and participating interests

		Subsidiary undertakings £			Total £
Cost
At 1 April 2013		477,452			477,452
At 31 March 2014		477,452			477,452
Provision for impairment
At 1 April 2013		477,374			477,374
Net book value
At 31 March 2014		78			78
At 31 March 2013		78			78

Page 23

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Details of undertakings

Details of the investments in which the group holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking	Holding	Proportion of voting rights and shares held	Principal activity
Subsidiary undertakings
Buymobilephones.net Limited	Ordinary	100%	Dormant
E Shop (Midlands) Limited	Ordinary	76%	Dormant
A1 Comms Retail Solutions Limited	Ordinary	100%	Retail sale of mobile communication products and services
A1 Comms Retail Limited	Ordinary	100%	Property management

13

Stocks

Group

Company

		2014 £			2013 £			2014 £			2013 £
Stocks		1,915,252			2,485,271			1,900,947			2,483,257

Page 24

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

14	Debtors due within one year

Group

Company

		2014 £			2013 £			2014 £			2013 £
Trade debtors		14,638,205			19,049,637			13,262,884			18,246,100
Amounts owed by group undertakings		-			-			873,755			957,948
Other debtors		2			126,996			-			126,994
Prepayments and accrued income		309,171			252,902			165,801			108,919
		14,947,378			19,429,535			14,302,440			19,439,961

Debtors due over one year

Group

Company

		2014 £			2013 £			2014 £			2013 £
Trade debtors		4,539,829			5,855,981			4,539,829			5,855,981

Page 25

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

15	Creditors: Amounts falling due within one year

Group

Company

		2014 £			2013 £			2014 £			2013 £
Trade creditors		9,575,166			17,620,091			9,252,456			17,064,130
Bank loans and overdrafts		80,600			233,765			80,600			233,765
Other loans		625,000			-			625,000			-
Obligations under finance lease and hire purchase contracts		41,268			37,156			41,268			37,156
Corporation tax		359,734			477,039			175,598			319,832
Other taxes and social security		3,035,944			4,203,565			2,168,018			3,658,890
Other creditors		720,218			161,094			623,491			59,921
Directors' current accounts		240,000			240,000			240,000			240,000
Accruals and deferred income		773,024			706,047			662,184			470,895
		15,450,954			23,678,757			13,868,615			22,084,589

Creditors amounts falling due within one year includes the following liabilities, on which security has been given by the group/company:

Group

	2014 £	2013 £
Bank loans and overdrafts	80,600	233,765
Obligations under finance leases and hire purchase contracts	41,268	37,156
Other loans	125,000	-
	246,868	270,921

The bank loans and overdrafts are secured by virtue of a debenture over all of the company's assets and a first legal charge over freehold land and buildings owned by the company.

The obligations under finance leases and hire purchase contracts are secured against the related asset.

The other loans are secured by virtue of fixed and floating charges over the assets of the company.

Page 26

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Company

	2014 £	2013 £
Bank loans and overdrafts	80,600	233,765
Obligations under finance lease and hire purchase agreements	41,268	37,156
Other loans	125,000	-
	246,868	270,921

The bank loans and overdrafts are secured by virtue of a debenture over all of the company's assets and a first legal charge over freehold land and buildings owned by the company.

The obligations under finance leases and hire purchase contracts are secured against the related asset.

The other loans are secured by virtue of fixed and floating charges over the assets of the company.

16	Creditors: Amounts falling due after more than one year

Group

Company

		2014 £			2013 £			2014 £			2013 £
Trade creditors		619,828			419,164			619,828			419,164
Bank loans and overdrafts		483,600			564,200			483,600			564,200
Other loans		125,000			-			125,000			-
Obligations under finance lease and hire purchase contracts		35,198			46,086			35,198			46,086
Directors' current accounts		2,046,273			1,813,959			2,046,273			1,813,959
		3,309,899			2,843,409			3,309,899			2,843,409

Creditors amounts falling due after more than one year includes the following liabilities, on which security has been given by the group/company:

Group

	2014 £	2013 £
Bank loans and overdrafts	483,600	564,200
Obligations under finance leases and hire purchase contracts	35,198	46,086
Other loans	125,000	-
	643,798	610,286

Page 27

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

The bank loans and overdrafts are secured by virtue of a debenture over all of the company's assets and a first legal charge over freehold land and buildings owned by the company.

The obligations under finance leases and hire purchase contracts are secured against the related asset.

The other loans are secured by virtue of fixed and floating charges over the assets of the company.

Company

	2014 £	2013 £
Bank loans and overdrafts	483,600	564,200
Obligations under finance lease and hire purchase agreements	35,198	46,086
Other loans	125,000	-
	643,798	610,286

The bank loans and overdrafts are secured by virtue of a debenture over all of the company's assets and a first legal charge over freehold land and buildings owned by the company.

The obligations under finance leases and hire purchase contracts are secured against the related asset.

The other loans are secured by virtue of fixed and floating charges over the assets of the company.

Included in the creditors are the following amounts due after more than five years:

Group

Company

		2014 £			2013 £			2014 £			2013 £
After more than five years by instalments		161,200			241,800			161,200			241,800

Obligations under finance leases and HP contracts Amounts repayable:

Group

Company

		2014 £			2013 £			2014 £			2013 £
In one year or less on demand		41,268			37,156			41,268			37,156
Between one and two years		35,198			23,224			35,198			23,224
Between two and five years		-			22,862			-			22,862
		76,466			83,242			76,466			83,242

Page 28

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

17	Provisions

Group

		Deferred tax £			Other provision £			Total £
At 1 April 2013		7,078			3,800,236			3,807,314
Charged/(credited) to the profit and loss account		34,424			(1,103,915)			(1,069,491)
At 31 March 2014		41,502			2,696,321			2,737,823

The sales related provision is the anticipated cost of sales promotions incurred by the group in respect of income generated. The provision has been estimated based on a combination of post year end information and use of past experience and statistical information of take up rates. This is expected to be paid over the next 24 months.

Analysis of deferred tax

		2014 £			2013 £
Accelerated capital allowances		41,502			7,078

Company

		Deferred tax £			Other provision £			Total £
At 1 April 2013		7,078			3,800,236			3,807,314
Charged/(credited) to the profit and loss account		20,082			(1,103,915)			(1,083,833)
At 31 March 2014		27,160			2,696,321			2,723,481

The sales related provision is the anticipated cost of sales promotions incurred by the group in respect of income generated. The provision has been estimated based on a combination of post year end information and use of past experience and statistical information of take up rates. This is expected to be paid over the next 24 months.

Analysis of deferred tax

		2014 £			2013 £
Accelerated capital allowances		27,160			7,078

Page 29

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

18	Share capital

Allotted, called up and fully paid shares
			2014		2013
			No.	£	No.	£
Ordinary shares of	£0.01	each	81,000	810	9,000	90
A Ordinary shares of	£0.01	each	9,000	90	1,000	10
Ordinary shares of	£0.001	each	90,000	90	-	-
A Ordinary shares of	£0.001	each	10,000	10	-	-
			190,000	1,000	10,000	100

New shares allotted and changes

During the year 81,000 Ordinary shares having an aggregate nominal value of £810 were allotted for an aggregate consideration of £810 via a Bonus issue .

During the year 9,000 A Ordinary shares having an aggregate nominal value of £90 were allotted for an aggregate consideration of £90 via a Bonus issue .

During the year the opening share capital of the company of 9,000 Ordinary shares and 1,000 A Ordinary, each with a nominal value of £0.01 were converted into 90,000 Ordinary shares and 10,000 A Ordinary shares, each with a nominal value of £0.001. Each share class ranks equally with each share entitling the shareholder to one vote.

19

Dividends

		2014 £			2013 £
Dividends paid
Current year interim dividend paid		-			336,000

Page 30

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

20

Reserves

Group

		Profit and loss account £			Total £
At 1 April 2013		3,423,263			3,423,263
Profit for the year		633,316			633,316
Other reserve movements		(900)			(900)
At 31 March 2014		4,055,679			4,055,679

Company

		Profit and loss account £			Total £
At 1 April 2013		2,812,293			2,812,293
Profit for the year		400,694			400,694
Other reserve movements		(900)			(900)
At 31 March 2014		3,212,087			3,212,087

21	Reconciliation of movement in shareholders' funds

Group

		2014 £			2013 £
Profit attributable to the members of the group		633,316			968,866
Dividends		-			(336,000)
New share capital subscribed		900			-
Purchase of own share capital		(900)			-
Net addition to shareholders' funds		633,316			632,866
Shareholders' funds at 1 April		3,423,363			2,790,497
Shareholders' funds at 31 March		4,056,679			3,423,363

Page 31

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

Company

		2014 £			2013 £
Profit attributable to the members of the company		400,694			488,120
Dividends		-			(336,000)
New share capital subscribed		900			-
Purchase of own share capital		(900)			-
Net addition to shareholders' funds		400,694			152,120
Shareholders' funds at 1 April		2,812,393			2,660,273
Shareholders' funds at 31 March		3,213,087			2,812,393

22	Pension schemes

Defined contribution pension scheme

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £21,614 (2013 - £15,332).

Page 32

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

23	Commitments

Operating lease commitments

Group

As at 31 March 2014 the group had annual commitments under non-cancellable operating leases as follows:

Operating leases which expire:

		2014 £			2013 £
Land and buildings
Within one year		72,759			29,153
Within two and five years		482,900			538,225
Over five years		612,075			716,075
		1,167,734			1,283,453
Other
Within one year		-			970
Within two and five years		29,526			18,423
		29,526			19,393

Company

As at 31 March 2014 the company had annual commitments under non-cancellable operating leases as follows:

Operating leases which expire:

		2014 £			2013 £
Land and buildings
Within one year		-			17,917
Within two and five years		15,000			-
Over five years		45,000			-
		60,000			17,917
Other
Within one year		-			970
Within two and five years		29,526			18,423
Over five years		-			-
		29,526			19,393

Page 33

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

24	Analysis of net debt

	At 1 April 2013 £	Cash flow £	Other non-cash changes £	At 31 March 2014 £
Cash at bank and in hand	1,314,935	(1,144,963)	-	169,972
Bank overdraft	(153,165)	153,165	-	-
	1,161,770	(991,798)	-	169,972
Debt due within one year	(80,600)	(544,400)	(80,600)	(705,600)
Debt due after more than one year	(564,200)	(125,000)	80,600	(608,600)
Finance leases and hire purchase contracts	(83,242)	44,176	(37,400)	(76,466)
Net debt	433,728	(1,617,022)	(37,400)	(1,220,694)

25	Related party transactions

Other related party transactions

During the year the company made the following related party transactions:

P & A R Sisson (directors) During the year dividends amounting to £nil (2013 - £336,000) and interest of £98,078 (2013 - £18,429) was paid to the directors. The directors have given a personal guarantee the company's bankers in respect of the bank loan and overdraft facilities to the value of £1,050,000 (2013 - £600,000). The bank also holds a legal charge over property owned by the directors. The value of this liability at the year end is £564,200 (2013 - £797,965). The directors have given a personal guarantee to two of the company's other lenders to the value of £750,000. The value of this liability at the year end is £750,000 (2013 - £nil) . At the balance sheet date the amount due to P & A R Sisson was £2,286,273 (2013 - £2,053,959).

A1 Corporate (a business in which 2 of the directors are proprietors) During the year the company paid commissions totalling £356,987 (2013 - £274,259). At the balance sheet date the amount due to A1 Corporate was £196,083 (2013 - £2,595).

Angela Sisson Pension Scheme (A scheme in which the director, A R Sisson, is a trustee) During the year the company paid commisions totalling £16,250 (£2013 - £nil). At the balance sheet date the amount due to Angela Sisson Pension Scheme was £16,250 (2013 - £nil).

S Joce (Key employee) During the year interest of £2,382 (2013 - £nil) was paid to this related party. At the balance sheet date the amount due to S Joce was £90,406 (2013 - £nil).

Page 34

A1 Comms Limited
Notes to the Financial Statements for the Year Ended 31 March 2014
......... continued

The company has taken advantage of the exemption in FRS8 "Related Party Disclosures" from disclosing transactions with other members of the group.

26

Control

The company is controlled by P Sisson and A Sisson who together own 90% of the called up share capital of the company.

Page 35