REGISTERED NUMBER:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic Report, Report of the Directors and |
|
Financial Statements for the Year Ended 31 December 2020 |
|
for |
|
Exyte Hargreaves Limited |
REGISTERED NUMBER:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Strategic Report, Report of the Directors and |
|
Financial Statements for the Year Ended 31 December 2020 |
|
for |
|
Exyte Hargreaves Limited |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
|
|
|
|
Contents of the Financial Statements |
for the Year Ended 31 December 2020 |
|
|
|
|
Page |
|
Company Information | 1 |
|
Strategic Report | 2 |
|
Report of the Directors | 5 |
|
Report of the Independent Auditors | 7 |
|
Income Statement | 11 |
|
Other Comprehensive Income | 12 |
|
Balance Sheet | 13 |
|
Statement of Changes in Equity | 15 |
|
Notes to the Financial Statements | 16 |
|
Exyte Hargreaves Limited |
|
|
Company Information |
for the Year Ended 31 December 2020 |
|
|
|
|
|
|
|
DIRECTORS: |
|
|
|
|
|
|
|
REGISTERED OFFICE: |
|
|
|
|
|
|
|
|
REGISTERED NUMBER: |
|
|
|
|
|
|
AUDITORS: |
|
Chartered Accountants and Statutory Auditor |
30 Gay Street |
Bath |
BA1 2PA |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Strategic Report |
for the Year Ended 31 December 2020 |
|
Principal Activities |
|
The principal activity of Exyte Hargreaves Limited ("the Company") is project delivery including design, engineering, procurement and installation of HVAC, mechanical and electrical installations, fire resistant and smoke control systems for high integrity client sectors and the manufacture of stainless steel ventilation containment, air ventilation ducting and components and the manufacture of fire resistant duct systems. |
|
Extensions to the principal activities form part of the strategic focus for growth. By building on the Company's reputation and heritage, it aims to become a leading principle partner for the design, engineering, manufacture and delivery of HVAC systems for high-tech industries. |
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Strategic Report |
for the Year Ended 31 December 2020 |
|
REVIEW OF BUSINESS |
The company's key financial and other performance indicators during the year were as follows: |
|
|
2020 | 2019 |
Total | Total |
£ s | £ s |
Revenue | 36,309 | 26,125 |
Gross (loss) / profit |
5,506 |
894 |
Gross profit % |
15.2% |
3.4% |
|
|
The turnover has increased by a 39.0% contribution of the new wins reported in the last strategic report. The business has continued to focus on core sectors which include the nuclear market and remained fully removed from the previous trade counters and commercial sector contracts. The higher gross margin reflects the complete exit of previous loss making business and the pricing of newer contracts. |
|
The retained profit in the year, together with a £2.5m recapitalisation of the Company, meant shareholder's funds increased from £0.7m to £4.2m. These positive assets, together with stronger profitability and the ongoing support of the Exyte Group, means the Company remains financially robust and able to deliver all its current and future planned projects. |
|
The company has extensive experience in providing specialist service and is a key element in the supply chain of the nuclear, transport, high tech industrial and defence industries in the UK, as such it remains well placed to meet the future demands of these sectors and have maintained its focus of reputation and in maintaining a good collaborative working relationship with existing clients within these industries. |
|
Further improvements have been made following the strategy review in 2018. Specific strategic activity during the last three years included: |
Extensive changes to the management board and extended leadership team. |
Refocusing of manufacturing and project delivery activities, including harnessing efficiencies in execution of both which include gearing manufacturing to support industrialised assembly of project delivery. |
Implementation of an improved strategy for new business aligned to core markets and high integrity projects. |
|
These steps have now started to yield the expected financial improvements and the directors believe that the actions taken, together with a roll out of further aspects of the new strategy, will provide further business growth in the future. |
|
Internally the business has created much greater operational transparency through the P&L separation of business manufacturing and operations (project delivery). |
|
The business has continued its focus of modernisation of systems and process, organisation structure, improved quality and quantity of sales pipeline as part of a back to basics programme which creates foundations for future growth. |
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Strategic Report |
for the Year Ended 31 December 2020 |
|
PRINCIPAL RISKS AND UNCERTAINTIES |
There are a number of potential risks and uncertainties, which could have a material impact on the Company's future performance and cause actual results to differ materially from expected or historical results. |
|
The Company operates in competitive market sectors and competitive pressure is therefore a continuing risk for the business. In addition, the sectors in which the Company operates could fluctuate subject to the business to market risks. The Company also faces manufacturing and environmental risks. These risks have not changed from the prior year and include changes to economic conditions and government policy; breach of health, safety and environmental laws, regulations and standards; failure to win new contracts; commercial counterparty competence and solvency; loss of senior personnel; information technology and security; taxation, interest rate and foreign exchange risk. The implementation of the Risk Management Initiative introduced in previous years has started to reduce the risk and uncertainties that the company may have in the development of its business activities in future years |
|
The Company's financial position and future prospects are described above. Due to its positive cash reserves and Group support the Company will have adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Board has continued to adopt the going concern basis in preparing the Company's financial statements. |
|
The impact of the COVID-19 pandemic in 2020 has been unprecedented and significant across the world. Firstly the safety and wellbeing of our staff has been paramount in our considerations, but our operating model and business continuity plans have proved to be very effective. |
|
We responded swiftly in the periods both leading up to and during "lockdown". Our staff quickly adapted to working from home and those who remained working on site were fully supported by the Company. As most sites remained open the effect on our revenues was minimal and our cashflows meant the Company was not required to access the Government support loan schemes. The Company did however make limited use of the Covid Job Protection Scheme and the deferral of quarter two VAT payments until 2021. The business has continued to operate normally in 2021. |
|
Brexit remains an important short-term consideration with potential consequences ranging from increases in cost prices, lower consumer confidence, lower government expenditure and supply chain disruption. However, such disruptions are expected to be short term and the company has taken steps to attempt to mitigate these effects, whilst recognising that the high level of uncertainty of the potential implications of Brexit make the success of mitigation activities difficult to predict. Since the EU-UK Trade and Cooperation Agreement came into force on 1 January 2021, there has been no impact on our business. |
|
ON BEHALF OF THE BOARD: |
|
|
|
|
|
|
|
|
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Report of the Directors |
for the Year Ended 31 December 2020 |
|
The directors present their report with the financial statements of the company for the year ended 31 December 2020. |
|
DIVIDENDS |
No dividends will be distributed for the year ended 31 December 2020. |
|
DIRECTORS |
|
|
Other changes in directors holding office are as follows: |
|
|
|
|
|
ENGAGEMENT WITH EMPLOYEES |
We value each individual who works for Exyte Hargreaves and believe that by having a strong team we can achieve the extraordinary. We provide support in every aspect that we can from mental health & wellbeing to providing opportunities by investing in training and development. |
|
Equal opportunities |
|
The Company is committed to creating a truly equal, diverse and inclusive workforce and inspiring the industry to make necessary change. As such the Company does not discriminate against employees on the basis of their age, disability, gender, sexual orientation, gender reassignment, pregnancy and maternity, race, religion or belief. |
|
Any applications for employment by disabled persons are always fully considered, bearing in mind the respective aptitudes and abilities of the applicant concerned. In the event of employees becoming disabled all reasonable efforts are made to ensure that their employment within the Company continues, including enjoying the same career development and promotion opportunities and training. |
|
Communication |
|
The Company operates an Intranet system where news, notices and events are shared. The site also has access to digital services and tools including IMS, ethics, benefits portal, Covid-19 Information and business social media. The system is constantly monitored and updated by our internal marketing department. In addition the Company has commenced using sharepoint so documentation regarding meeting minutes, shared files etc are all saved and can be accessed by the relevant personnel. |
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Report of the Directors |
for the Year Ended 31 December 2020 |
|
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, Moore, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
|
ON BEHALF OF THE BOARD: |
|
|
|
|
|
|
|
|
|
|
Report of the Independent Auditors to the Members of |
Exyte Hargreaves Limited |
|
Opinion |
We have audited the financial statements of Exyte Hargreaves Limited (the 'company') for the year ended 31 December 2020 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and 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 101 'Reduced Disclosure Framework' (United Kingdom Generally Accepted Accounting Practice). |
|
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 December 2020 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. |
|
Report of the Independent Auditors to the Members of |
Exyte Hargreaves Limited |
|
|
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 set out on page six, 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. |
|
Report of the Independent Auditors to the Members of |
Exyte Hargreaves Limited |
|
|
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. |
|
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
|
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud |
|
The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company. |
|
Our approach was as follows: |
|
We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that the most significant are the Companies Act 2006, UK Financial Reporting Standards, and UK taxation legislation. |
|
We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance. |
|
We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance. |
|
We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations. |
|
Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required. |
|
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. |
|
Report of the Independent Auditors to the Members of |
Exyte Hargreaves Limited |
|
|
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. |
|
|
|
|
|
for and on behalf of
|
Chartered Accountants and Statutory Auditor |
30 Gay Street |
Bath |
BA1 2PA |
|
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Income Statement |
for the Year Ended 31 December 2020 |
|
31.12.20 | 31.12.19 |
Notes | £'000 | £'000 |
|
TURNOVER | 3 |
|
|
|
Cost of sales |
|
|
GROSS PROFIT |
|
|
|
Administrative expenses |
|
|
353 | (3,740 | ) |
|
Other operating income | 4 |
|
|
OPERATING PROFIT/(LOSS) |
|
( |
) |
|
|
Interest payable and similar expenses | 6 |
|
|
PROFIT/(LOSS) BEFORE TAXATION | 7 |
|
( |
) |
|
Tax on profit/(loss) | 9 |
|
( |
) |
PROFIT/(LOSS) FOR THE FINANCIAL
YEAR |
|
( |
) |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Other Comprehensive Income |
for the Year Ended 31 December 2020 |
|
31.12.20 | 31.12.19 |
Notes | £'000 | £'000 |
|
PROFIT/(LOSS) FOR THE YEAR |
|
( |
) |
|
|
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR
THE YEAR |
|
( |
) |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Balance Sheet |
31 December 2020 |
|
31.12.20 | 31.12.19 |
Notes | £'000 | £'000 | £'000 | £'000 |
FIXED ASSETS |
Owned |
Tangible assets | 10 | 1,023 | 1,199 |
Right-of-use |
Tangible assets | 10, 16 | 52 | 63 |
|
|
|
CURRENT ASSETS |
Stocks | 11 |
|
|
Debtors | 12 |
|
|
Contract assets | 3 | 5,928 | 3,465 |
Cash at bank |
|
|
|
|
CREDITORS |
Amounts falling due within one year | 13 | ( |
) | ( |
) |
|
CONTRACT LIABILITIES |
Amounts falling due within one year | 3 | (7,777 | ) | (3,782 | ) |
NET CURRENT ASSETS/(LIABILITIES) |
|
( |
) |
TOTAL ASSETS LESS CURRENT
LIABILITIES |
|
|
|
CREDITORS |
Amounts falling due after more than
one year |
14 |
|
|
NET ASSETS |
|
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Balance Sheet - continued |
31 December 2020 |
|
31.12.20 | 31.12.19 |
Notes | £'000 | £'000 | £'000 | £'000 |
CAPITAL AND RESERVES |
Called up share capital | 18 |
|
|
Share premium | 19 |
|
|
Revaluation reserve | 19 |
|
|
Other reserves | 19 |
|
|
Retained earnings | 19 | ( |
) | ( |
) |
SHAREHOLDERS' FUNDS |
|
|
|
|
The financial statements were approved by the Board of Directors and authorised for issue on
|
|
|
|
|
|
|
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Statement of Changes in Equity |
for the Year Ended 31 December 2020 |
|
Called up |
share | Retained | Share |
capital | earnings | premium |
£'000 | £'000 | £'000 |
|
Balance at 1 January 2019 |
|
( |
) |
|
|
Changes in equity |
Total comprehensive income | - | ( |
) | - |
Balance at 31 December 2019 |
|
(3,716 | ) |
|
|
Changes in equity |
Issue of share capital |
|
- |
|
Total comprehensive income | - |
|
- |
Balance at 31 December 2020 |
|
( |
) |
|
Revaluation | Other | Total |
reserve | reserves | equity |
£'000 | £'000 | £'000 |
|
Balance at 1 January 2019 |
|
|
|
|
Changes in equity |
Total comprehensive income |
|
|
( |
) |
Balance at 31 December 2019 |
|
|
|
|
Changes in equity |
Issue of share capital | - | - |
|
Total comprehensive income |
|
- |
|
Balance at 31 December 2020 |
|
|
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements |
for the Year Ended 31 December 2020 |
|
1. | STATUTORY INFORMATION |
|
Exyte Hargreaves Limited is a
|
|
2. | ACCOUNTING POLICIES |
|
Basis of preparation |
|
|
Measurement convention |
|
The financial statements are prepared on the historical cost basis. |
|
The functional currency is GBP sterling. |
|
Going concern |
|
The financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons. |
|
The company meets its day to day working capital requirements through cash balances and a loan from a parent company, Exyte GmbH, that is repayable on demand (see note 13). As at the date of approval of these financial statements, the amount owing in the loan was £2,858k. |
|
The directors have prepared cash flow forecasts for a period of at least 12 months from the date of approval of these financial statements which indicate that, taking account of reasonably possible downsides, the company will have sufficient funds to meet its liabilities as they fall due for that period. |
|
Those forecasts are dependent on the company's parent company, Exyte GmbH, not seeking repayment of the loan amounts currently due to the group, which at 31 December 2020 amounted to £2,850k. Exyte GmbH has indicated that it does not intend to seek repayment of the amounts owed for the period covered by the forecasts. As with any company placing reliance on other group entities for financial support, the directors acknowledge that there can be no certainty that this support will continue, especially in the current climate with many Groups considering their overall strategy and structure, although, at the date of approval of these financial statements, they have no reason to believe that it will not do so. |
|
Consequently, the directors are confident that the company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 101 "Reduced Disclosure Framework": |
|
• | the requirements of paragraphs 45(b) and 46 to 52 of IFRS 2 Share-based Payment; |
• |
the requirements of paragraphs 62, B64(d), B64(e), B64(g), B64(h), B64(j) to B64(m), B64(n)(ii),
B64(o)(ii), B64(p), B64(q)(ii), B66 and B67 of IFRS 3 Business Combinations; |
• |
the requirements of paragraph 33(c) of IFRS 5 Non Current Assets Held for Sale and
Discontinued Operations; |
• |
the requirements of paragraph 24(6) of IFRS 6 Exploration for and Evaluation of Mineral
Resources; |
• | the requirements of IFRS 7 Financial Instruments: Disclosures; |
• | the requirements of paragraphs 91 to 99 of IFRS 13 Fair Value Measurement; |
• |
the requirements of paragraph 52, the second sentence of paragraph 89, and paragraphs 90, 91
and 93 of IFRS 16 Leases; |
the requirements of paragraph 58 of IFRS 16; |
• |
the requirements of the second sentence of paragraph 110 and paragraphs 113(a), 114, 115,
118, 119(a) to (c), 120 to 127 and 129 of IFRS 15 Revenue from Contracts with Customers; |
• |
the requirement in paragraph 38 of IAS 1 Presentation of Financial Statements to present
comparative information in respect of: |
- | paragraph 79(a)(iv) of IAS 1; |
- | paragraph 73(e) of IAS 16 Property, Plant and Equipment; |
- | paragraph 118(e) of IAS 38 Intangible Assets; |
- | paragraphs 76 and 79(d) of IAS 40 Investment Property; and |
- | paragraph 50 of IAS 41 Agriculture; |
• |
the requirements of paragraphs 10(d), 10)(f), 16, 38A, 38B, 38C, 38D, 40A, 40B, 40C, 40D and
111 of IAS 1 Presentation of Financial Statements; |
• | the requirements of paragraphs 134 to 136 of IAS 1 Presentation of Financial Statements; |
• | the requirements of IAS 7 Statement of Cash Flows; |
• |
the requirements of paragraphs 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting
Estimates and Errors; |
• | the requirements of paragraphs 17 and 18A of IAS 24 Related Party Disclosures; |
• |
the requirements in IAS 24 Related Party Disclosures to disclose related party transactions
entered into between two or more members of a group; |
• |
the requirements of paragraphs 134(d) to 134(f) and 135(c) to 135(e) of IAS 36 Impairments of
Assets. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Turnover |
Revenue represents the amounts (excluding value added tax) derived from the provision of goods and services to customers. Revenue is measured based on the consideration specified in a contract with a customer. Where consideration is not specified within the contract and is therefore subject to variability, revenue is based on an estimated amount of consideration to be received from a customer in respect of obligation performed. The consideration recognised is the amount which is highly probable not to result in a significant reversal in future periods. Where a modification to an existing contract occurs, the nature of the modification is assessed to determine whether it represents a separate performance obligation or whether it is a modification to the existing performance obligation. Due to the wide-ranging activities performed, and as such, depending on the nature of the product or service delivered and the timing of when control is passed onto the customer, revenue is accounted for over time and at a point in time. Where revenue is measured over time, the input method to measure progress of delivery is used. Revenue is recognised as follows: - revenue from project delivery activities is recognised over time and the input method to measure progress of delivery - revenue from direct supply of manufactured products is recognised at a point in time when title has passed to the customer. |
|
Project delivery contracts |
|
When the outcome of individual contracts can be estimated reliably, contract revenue and contract costs are recognised as revenue and expenses respectively by reference to the stage of completion of the performance obligation at the reporting date. Costs are recognised as incurred and revenue is recognised on the basis of the proportion of total costs at the reporting date to the estimated total costs for the performance obligation as detailed within the contract. Estimates of the final out-turn on each contract may include cost contingencies to take account of the specific risks within each contract that have been identified during the early stages of the contract. The cost contingencies are reviewed on a regular basis throughout the contract life and are adjusted where appropriate. However, the nature of the risks on contracts are such that they often cannot be resolved until the end of the project and therefore may not reverse until the end of the project. The estimated final out-turns on contracts are continuously reviewed, and in certain limited cases, recoveries from insurers are assessed, and adjustments made where necessary. No margin is recognised until the outcome of the contract can be estimated with reasonable certainty. Provision is made for all known or expected losses on individual contracts once such losses are foreseen. Revenue in respect of variations to contracts and incentive payments is recognised when it is highly probable it will be agreed by the customer. Revenue in respect of claims is recognised only if it is highly probable not to reverse in future periods. Profit for the year includes the benefit of claims settled in the year to the extent not previously recognised on contracts completed in previous years |
|
Government grants |
|
Government grants are recognised at the fair value of the consideration received or receivable in the period in which the Company recognises the related costs for which the grants are intended to compensate. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Tangible fixed assets |
|
|
Freehold property | - |
|
Long leasehold | - |
|
Plant, machinery and motor vehicles | - |
|
|
Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Freehold land and buildings that had been revalued to fair value prior to 1 January 2016, the date of transition to FRS101 are measured on the basis of deemed cost, being the revalued amount at the date of transition. |
|
Stocks |
Stocks are stated at the lower of cost and net realisable value. Costs incurred in bringing each product to its present location and condition are based on: |
|
- Raw materials. Purchase cost on a weighted average basis, including carriage. |
|
- Work in progress and finished goods. Cost of direct materials and labour, plus an appropriate proportion of manufacturing overheads based on normal levels of activity. |
|
Net realisable value is based on estimated selling price, less further costs expected to be incurred to completion and sale. |
|
Provision is made for obsolete, slowing moving or defective items where appropriate. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Taxation |
Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules, using tax rates enacted or substantially enacted by the balance sheet date. |
|
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss account except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised directly in equity or other comprehensive income. |
|
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
|
Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of goodwill; the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a business combination, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilised. |
|
Research and development |
Expenditure on research activities is recognised in the profit and loss account as an expense as incurred. |
|
Expenditure on development activities is capitalised if the product or process is technically and commercially feasible and the Company intends and has the technical ability and sufficient resources to complete development, future economic benefits are probable and if the Company can measure reliably the expenditure attributable to the intangible asset during its development. Development activities involve a plan or design for the production of new or substantially improved products or processes. The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion of overheads and capitalised borrowing costs. Other development expenditure is recognised in the profit and loss account as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation and less accumulated impairment losses. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Foreign currencies |
Transactions in foreign currencies are translated to the Company's functional currencies at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair value was determined. Foreign exchange differences arising on translation are recognised in the profit and loss account. |
|
Leases |
Leases are recognised as finance leases. The lease liability is initially recognised at the present value of the lease payments which have not yet been made and subsequently measured under the amortised cost method. The initial cost of the right-of-use asset comprises the amount of the initial measurement of the lease liability, lease payments made prior to the lease commencement date, initial direct costs and the estimated costs of removing or dismantling the underlying asset per the conditions of the contract. |
|
Where ownership of the right-of-use asset transfers to the lessee at the end of the lease term, the right-of-use asset is depreciated over the asset’s remaining useful life. If ownership of the right-of-use asset does not transfer to the lessee at the end of the lease term, depreciation is charged over the shorter of the useful life of the right-of-use asset and the lease term. |
|
Employee benefits |
Defined contribution plans |
|
A defined contribution plan is a post-employment benefit plan under which the company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an expense in the profit and loss account in the periods during which services are rendered by employees. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Financial instruments |
Classification of financial instruments issued by the Company |
|
Following the adoption of IAS 32, financial instruments issued by the Company are treated as equity only to the extent that they meet the following two conditions: |
(a) they include no contractual obligations upon the company to deliver cash or other financial assets or to exchange financial assets or financial liabilities with another party under conditions that are potentially unfavourable to the company; and |
(b) where the instrument will or may be settled in the company's own equity instruments, it is either a non-derivative that includes no obligation to deliver a variable number of the company's own equity instruments or is a derivative that will be settled by the company's exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments. |
|
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument so classified takes the legal form of the company's own shares, the amounts presented in these financial statements for called up share capital and share premium account exclude amounts in relation to those shares. |
|
Non-derivative financial instruments |
|
Non-derivative financial instruments comprise investments in equity and debt securities, trade and other debtors, cash and cash equivalents, loans and borrowings, and trade and other creditors. |
|
Trade and other debtors |
Trade and other debtors are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses. |
|
Trade and other creditors |
Trade and other creditors are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method. |
|
Interest-bearing borrowings |
Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Construction contract debtors |
Construction contract debtors represent unbilled revenue amounts relating to contract work recognised to date in accordance with performance against obligations contained within customer contracts. They are based on an estimated amount of uninvoiced consideration to be received from a customer in respect of obligation performed. |
|
Construction contract debtors are presented as part of debtors in the balance sheet. If payments received from customers exceed the income recognised, then the difference is presented as creditors:amounts falling due within one year in the balance sheet. |
|
Impairment excluding stocks, and deferred tax assets |
|
Financial assets (including trade and other debtors) |
|
A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. For expected losses a financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably. Any unexpected losses, in accordance with IFRS 9 Financial instruments, are calculated using a credit loss model approach informed by analysis of historic performance, principally relating to the sale of goods. Adoption of IFRS 9 resulted in no adjustments to previously reported results. |
|
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset's original effective interest rate. For financial instruments measured at cost less impairment an impairment is calculated as the difference between its carrying amount and the best estimate of the amount that the Company would receive for the asset if it were to be sold at the reporting date. Interest on the impaired asset continues to be recognised through the unwinding of the discount. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss. |
|
Trade debtors are initially recorded at their fair value and subsequently measured at amortised cost with allowance for any estimated irrecoverable amounts. |
|
Non-financial assets |
|
The carrying amounts of the Company's non-financial assets, other than stocks are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. |
|
In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
2. | ACCOUNTING POLICIES - continued |
|
Provisions |
A provision is recognised in the balance sheet when the Company has a present legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects risks specific to the liability. |
|
Expenses |
|
Operating lease payments |
|
Payments (excluding costs for services and insurance) made under operating leases are recognised in the profit and loss account on a straight-line basis over the term of the lease. Lease incentives received are recognised in the profit and loss account as an integral part of the total lease expense. |
|
3. | TURNOVER |
|
Revenue from contracts with customers |
Contract assets arise where goods or services are transferred to the customer before the customer pays consideration, or before payment is due. Contract assets represent our unconditional right to consideration for the goods and services supplied and performance obligations delivered. Contract liabilities relate to consideration received when the Company still has an obligation to deliver goods or services for that consideration. |
|
The amount of revenue recognised in the current period from performance obligations satisfied (or |
partially satisfied) in previous periods was £3,464,000. |
|
The amount of revenue recognised in the current period that was included in the contract liability |
balance at the beginning of the period was £3,782,000. |
|
Contract balances |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Contract assets |
|
Current |
Contract assets | 5,928 | 3,465 |
|
Contract liabilities |
|
Current |
Contract liabilities | 7,777 | 3,782 |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
4. | OTHER OPERATING INCOME |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Sundry receipts | 578 | 801 |
Government grants |
|
|
|
|
|
Government Grants represent amounts received and receivable for the Coronavirus Job Retention Scheme. |
|
5. | EMPLOYEES AND DIRECTORS |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Wages and salaries | 10,933 | 11,892 |
Social security costs |
|
|
Other pension costs |
|
|
|
|
|
The average number of employees during the year was as follows: |
31.12.20 | 31.12.19 |
|
Production | 234 | 272 |
Selling and marketing | 7 | 5 |
Administration | 16 | 20 |
|
|
|
31.12.20 | 31.12.19 |
£ | £ |
Directors' remuneration |
|
|
Directors' pension contributions to money purchase schemes |
|
|
|
Information regarding the highest paid director is as follows: |
31.12.20 | 31.12.19 |
£ | £ |
Emoluments etc | 234,765 | 225,000 |
Pension contributions to money purchase schemes | 11,536 | 11,000 |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Interest on loans from Group
undertakings |
68 |
20 |
Leasing |
|
|
|
|
|
7. | PROFIT/(LOSS) BEFORE TAXATION |
|
The profit before taxation (2019 - loss before taxation) is stated after charging/(crediting): |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Cost of inventories recognised as expense |
|
|
Depreciation - owned assets |
|
|
Depreciation - assets on hire purchase contracts or finance leases |
|
|
Foreign exchange differences | ( |
) |
|
|
8. | AUDITORS' REMUNERATION |
|
2020 | 2019 |
£ | £ |
Audit of these financial statements |
Incumbent auditors | 25 | - |
Previous auditors | - | 35 |
Amounts receivable by the company's auditors and its associates in
respect of: |
|
Taxation compliance services |
Incumbent auditors | 4 | - |
Previous auditors | - | 7 |
|
9. | TAXATION |
|
Analysis of tax expense/(income) |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Current tax: |
Tax |
|
( |
) |
|
Deferred tax |
|
|
Total tax expense/(income) in income statement |
|
( |
) |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
9. | TAXATION - continued |
|
Factors affecting the tax expense |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
|
31.12.20 | 31.12.19 |
£'000 | £'000 |
Profit/(loss) before income tax |
|
( |
) |
Profit/(loss) multiplied by the standard rate of corporation tax in
the UK of |
219 |
(564 |
) |
|
Effects of: |
Non-deductible expenses | - | 8 |
Other short-term timing differences | (26 | ) | (94 | ) |
Tax expense/(income) |
|
( |
) |
|
10. | TANGIBLE FIXED ASSETS |
Plant, |
machinery |
Freehold | Long | and motor |
property | leasehold | vehicles | Totals |
£'000 | £'000 | £'000 | £'000 |
COST |
At 1 January 2020 |
|
|
|
|
Additions |
|
|
|
|
Disposals |
|
|
( |
) | ( |
) |
At 31 December 2020 |
|
|
|
|
DEPRECIATION |
At 1 January 2020 |
|
|
|
|
Charge for year |
|
|
|
|
Eliminated on disposal |
|
|
( |
) | ( |
) |
At 31 December 2020 |
|
|
|
|
NET BOOK VALUE |
At 31 December 2020 |
|
|
|
|
At 31 December 2019 |
|
|
|
|
|
The net book value of freehold land which is not depreciated is £87,340 (2019 : £87,340). |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
11. | STOCKS |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Raw materials and consumables |
|
|
|
Raw materials, consumables and changes in finished goods and work in progress recognised as cost of sales in the year amounted to £30,803,000 (2019 : £25,231,000). |
|
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Trade debtors |
|
|
Amounts owed by group undertakings |
|
|
Deferred tax asset | 1,768 | 1,851 |
Prepayments and accrued income |
|
|
|
|
|
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Leases (see note 15) |
|
|
Trade creditors |
|
|
Amounts owed to group undertakings |
|
|
Social security and other taxes |
|
|
Accruals and deferred income |
|
|
|
|
|
14. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
31.12.20 | 31.12.19 |
£'000 | £'000 |
Leases (see note 15) |
|
|
|
15. | FINANCIAL LIABILITIES - BORROWINGS |
|
31.12.20 | 31.12.19 |
£'000 | £'000 |
Current: |
Leases (see note 16) | 15 | 65 |
|
Non-current: |
Leases (see note 16) | 38 | - |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
15. | FINANCIAL LIABILITIES - BORROWINGS - continued |
|
Terms and debt repayment schedule |
|
1 year or |
less | 1-2 years | 2-5 years | Totals |
£'000 | £'000 | £'000 | £'000 |
Leases | 15 | 15 | 23 | 53 |
|
16. | LEASING |
|
Right-of-use assets |
|
Tangible fixed assets |
|
31.12.20 | 31.12.19 |
£'000 | £'000 |
COST |
At 1 January 2020 | 213 | - |
Additions | 60 | 213 |
273 | 213 |
|
DEPRECIATION |
At 1 January 2020 | 150 | - |
Charge for year | 71 | 150 |
221 | 150 |
|
NET BOOK VALUE | 52 | 63 |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
16. | LEASING - continued |
|
Lease liabilities |
|
Minimum lease payments fall due as follows: |
|
31.12.20 | 31.12.19 |
£'000 | £'000 |
Gross obligations repayable: |
Within one year | 17 | 65 |
Between one and five years | 41 | - |
|
58 | 65 |
|
Finance charges repayable: |
Within one year | 2 | - |
Between one and five years | 3 | - |
5 | - |
|
Net obligations repayable: |
Within one year | 15 | 65 |
Between one and five years | 38 | - |
53 | 65 |
|
17. | DEFERRED TAX |
£'000 |
Balance at 1 January 2020 | ( |
) |
Charge to Income Statement during year | 83 |
Balance at 31 December 2020 | ( |
) |
|
18. | CALLED UP SHARE CAPITAL |
|
|
Allotted and issued: |
Number: | Class: | Nominal | 31.12.20 | 31.12.19 |
value: | £'000 | £'000 |
|
Ordinary | £1 | 1,002 | 1,001 |
|
|
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
19. | RESERVES |
Retained | Share | Revaluation | Other |
earnings | premium | reserve | reserves | Totals |
£'000 | £'000 | £'000 | £'000 | £'000 |
|
At 1 January 2020 | ( |
) |
|
|
|
(279 | ) |
Profit for the year |
|
|
Bonus share issue |
|
|
- |
|
|
At 31 December 2020 | ( |
) |
|
|
|
3,180 |
|
On 20 July 2020, 1,000 shares with a nominal value of £1 each were issued to the immediate parent company, Exyte Singapore Pte Ltd for £2.5 million. |
|
20. | PENSION COMMITMENTS |
|
The company operates a defined contribution pension plan. The total expense relating to this plan was £570,000 (2019 : £566,000). Contributions that were payable to the scheme, which have been included in Creditors: amounts falling due within one year were £90,950 (2019 : £110,000). |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
21. | RELATED PARTY DISCLOSURES |
|
During the year, the company entered into transactions, and had balances outstanding at the year end, with fellow group companies under common control. |
|
Sales | Sales | Purchases | Purchases |
2020 | 2019 | 2020 | 2019 |
£ | £ | £ | £ |
M+W Group GmbH | - | - | 36 | - |
Exyte Singapore Pte Ltd | - | - | 5 |
MW High Tech Project Ltd | - | 1,798 | 102 | 145 |
Exyte GmbH | - | 2 | 371 | 67 |
Exyte Management GmbH | - | - | 163 | 407 |
Exyte Europe Holding GmbH | - | - | 117 | 155 |
- | 1,800 | 789 | 779 |
Debtors | Debtors | Creditors | Creditors |
2020 | 2019 | 2020 | 2019 |
£ | £ | £ | £ |
M+W Group GmbH | - | - | 13 | 203 |
Exyte Singapore Pte Ltd | - | - | - | - |
MW High Tech Project Ltd | - | 443 | - | 175 |
Exyte GmbH | - | - | 2,858 | 4,515 |
Exyte Management GmbH | - | - | 34 | 209 |
Exyte Europe Holding GmbH | - | - | 5 | 44 |
- | 443 | 2,910 | 5,146 |
|
22. | ULTIMATE CONTROLLING PARTY |
|
The immediate parent undertaking is Exyte Singapore Pte Limited, registered at 16 International Business Park 02-00 Singapore 609929, which owns 100% of the share capita. |
|
The ultimate controlling party is Mag. Georg Stumpf by virtue of his shareholding in M+W Group GMBH. |
|
The ultimate parent company is M+W Group GmbH. The consolidated accounts of this Company are available to the public and may be obtained from its registered office, which is M+W Group GmbH, Löwentorbogen 9B, 70376 Stuttgart, Germany. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
23. | FINANCIAL INSTRUMENTS |
|
The Company's financial instruments comprise cash balances, payables and receivables that arise from its operations. |
|
The Company's activities expose it to various financial risks, market risk (foreign exchange risk) and credit risk. |
|
Foreign exchange risk |
|
The Company operates in the EU and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Euro. Foreign exchange risk arises primarily from recognised assets and liabilities. The directors consider, where the numbers involved are material to the business, utilising derivative financial instruments to mitigate this exposure. |
|
Credit risk |
|
Credit risk is the risk of financial loss to the Company if a customer or counterparty to the financial instrument fails to meet its contractual obligations, and arises principally from the Company's receivables from customers. The Company has a credit policy in place and exposure to credit risk is monitored on an on-going basis. |
|
Credit risk arising on operating and other receivables, loans due to Group companies and cash and cash equivalents is mitigated by management involvement in Group companies. |
|
Liquidity risk |
|
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company evaluates and follows continuously the amounts of liquid funds needed for the business operations, in order to secure the funding needed for business activities and loan repayments. The availability and flexibility of the financing is needed to assure the Company's financial position. The Company's funding comes from shareholder loans. |
|
Market risk |
|
Market risk is the risk that changes in the market prices, such as foreign exchange rates and interest rates will affect the Company's income or the value of its holdings of financial instruments. |
Exyte Hargreaves Limited (Registered number: 00288899) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
24. | ACCOUNTING ESTIMATES AND JUDGEMENTS |
|
In preparing these financial statements, the directors are required to make judgements, estimates and assumptions that affect the application of polices and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical results, experience and other factors that are believed to be reasonable measures. Actual results may differ from estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. |
|
Certain critical accounting judgements in applying the Company's accounting policies are described below: |
|
Revenue recognition |
The Company has recognised construction assets and the recoverability is regularly reviewed for each contract, and specific provisions are recognised for balances considered to be irrecoverable. In order to apply the Company's policy for recognition of revenue from such contracts that are only partially complete at the reporting date, the directors must assess the value of the of work completed on each contract. |
|
Provisions |
Provisions are liabilities of uncertain timing or amount and therefore in making a reliable estimate of the value and timing of liabilities judgement is applied and re-evaluated at each reporting date. |