Registered number: 03007851
financial statements
For the year ended 31 July 2019
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
COMPANY INFORMATION
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
CONTENTS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2019
The Directors present their strategic report on Protocol National Limited (“the Company”) for the year ended 31 July 2019.
The Company supplies self-employed part time staff, recruitment services, educational assessment services and training, consultancy, and technology services to its customers, that are predominantly Colleges of Further Education (FE) or Independent Training Providers (ITPs). The market is a competitive one, impacting on sales levels albeit after a slower start to the year and a stronger finish profit before exceptional items has increased. Whilst challenging market conditions and continuing funding restrictions for FE colleges remain the Directors consider that the trading result for the year was satisfactory, given the business environment in which the Company operates.
The FE and wider Skills sector continues to present the Company with challenges and opportunities. The Directors are committed to working in partnership with the colleges and ITPs to provide value for money solutions with new and existing services and believe that the Company is well positioned in the sector to support its evolving needs. The Directors are committed to investing in additional Recruitment Consultants to develop greater market share within existing sectors and to develop opportunities in the Higher Education sector. The Directors consider that the Company is in a stable position, and up to the timing and impact of the Coronavirus expect financial performance in the current financial year to be similar to last year. The statutory accounts reported in the previous period represent a 10-month period to July 2018. Directors changed the financial reporting in line with the academic year, to better mirror the majority of our clients within the FE sector. As of May 2018, to simplify our corporate structure all trade from the company eSafeguarding was transacted by Protocol National, with the service still being provided under the eSafeguarding brand. The eSafeguarding service provides disclosure and barring service certificate checking to its clients. On the 18 June 2018, Protocol National’s parent company ELS Group Ltd was wholly acquired by Protocol Holdings Ltd. From this date Protocol Holdings Ltd is the ultimate holding company.
The management of the business and the execution of the Company’s strategy are exposed to several risks. The key business risks affecting the Company are set out below:
Competition The Company remains a leading third-party provider of staff to FE colleges in the United Kingdom. Revision of government funding, college mergers and the need for colleges to become more flexible in their response continue to provide market restrictions as well as opportunities for all the Company’s current services and to stimulate the development of new service lines. Employees The Company is reliant on its highly motivated, well trained, experienced and customer responsive workforce. Continuous training and development of staff is essential to ensure maximum business process efficiencies as are competitive remuneration strategies to ensure staff retention.
Page 1
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
The quality, capability, capacity, accuracy and security of the Company’s database of visiting lecturers is key to maintaining our market leading position. Significant investment in technical and content improvement and user training has been made to ensure that the business continues to deliver high quality, fast service to its clients. The Company invests significant resource to complying with Data Protection regulations that impact the business. Legislation and regulatory compliance, Pensions auto-enrolment, Agency Worker Regulations, and safeguarding children and vulnerable adults’ legislation have all increased the administrative burden to the business in recent years. The Apprenticeship Levy and IR35 impact administration also.
BREXIT The impact of Brexit is relatively unquantifiable at this point in time but will likely impact the UK’s economy and performance in the years ahead, not least through its Labour Market and Skills economy. Going Concern – COVID-19 Impact Coronavirus will have a significant impact on how the UK operates and how FE colleges and Universities deliver education, skills and training in future. Should COVID-19 not peak and come under control in the manner predicted then Directors anticipate a continuation of remote education and the continuation of recruitment opportunities to support this. The Company has already proven itself as being agile and adaptive in adjusting to this temporary way of working and can sustain this approach if it is retained by clients. Notwithstanding, should the COVID-19 crisis not be under control by September 2020, with the UK economy failing to return to normal then Directors anticipate further measures of Government support to sustain the company. The company was in a strong position when it entered the COVID-19 crisis with a growing sales book and a robust balance sheet, having identified a clear strategy for future growth. Investment has been made to recruit experienced Recruitment Consultant staff to propel this growth and these have been retained, pending scaled business resumption. Liquidity is being maintained through strong cash management, ensuring there are no immediate cashflow concerns. All available Government assistance is been considered and utilised where appropriate. Directors are confident of a return to business levels consistent with the 7 months of positive trading experienced until COVID-19 impacted the economy together with a resumption of investing activities and are committed to a continuance of business.
2019 2018 £'000 £’000
Gross Profit 3,524 3,127 Earnings Before Interest, Tax, Depreciation & Amortisation 444 (5,355)
This report was approved by the board
and signed on its behalf.
Page 2
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2019
The Directors present their report and the financial statements for the year ended
The Directors are responsible for preparing the Strategic Report, 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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:
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 to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £
291
k
(2018 -
loss
£
5,490
k)
.
No dividends were paid or proposed during the year (2018 - £NIL).
The Directors who served during the year were:
Page 3
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
Each of the persons who are
Directors at the time when this Directors' report is approved has confirmed that:
The Company has granted an indemnity to one or more of its Directors against liability in respect of proceedings brought by third parties, subject to the conditions set out in section 234 of the Companies Act 2006. Such qualifying third party indemnity provision remains in force as at the date of approving the Directors’ report.
Since the Balance Sheet date, there has been a global outbreak of coronavirus (COVID-19). On 12 March, the World Health Organisation declared the outbreak of coronavirus (COVID-19) a pandemic. Many countries, including the UK, have reacted to contain and delay the spread of the virus, which included extensive social distancing, business closures and travel bans. The directors considered the financial impact of this pandemic and have concluded that the matter is a non-adjusting PBSE.
The auditor, Mazars LLP, will be proposed for reappointment in accordance with
section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
Page 4
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROTOCOL NATIONAL LIMITED
We have audited the financial statements of Protocol National Limited (the 'Company') for the year ended 31 July 2019, which comprise the profit and loss account, the balance sheet, the statement of cash flows, the 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 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
∙
give a true and fair view of the state of the Company's affairs as at 31 July 2019 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.
Emphasis of matter – Impact of the outbreak of COVID-19 on the financial statements In forming our opinion on the company financial statements, which is not modified, we draw your attention to the directors’ view on the impact of the COVID-19 as disclosed on page 2, and the consideration in the going concern basis of preparation on page 14 and non- adjusting post balance sheet events on page 29. Since the balance sheet date there has been a global pandemic from the outbreak of COVID-19, The potential impact of COVID-19 became significant in March 2020 and is causing widespread disruption to normal patterns of business activity across the world, including the UK. The full impact following the recent emergence of the COVID-19 is still unknown. It is therefore not currently possible to evaluate all the potential implications to the company's trade, customers, suppliers and the wider economy.
Page 5
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROTOCOL NATIONAL LIMITED (CONTINUED)
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
∙
the Directors
' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
∙
the Directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
The Directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditor's report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
In our opinion, based on the work undertaken in the course of the audit:
Page 6
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROTOCOL NATIONAL LIMITED (CONTINUED)
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 Directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
∙
the financial statements are not in agreement with the accounting records and returns; or
∙
certain disclosures of Directors
' remuneration specified by law are not made; or
∙
we have not received all the information and explanations we require for our audit.
As explained more fully in the Directors' responsibilities statement on page 3, 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 is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the 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.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
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 Auditor's report.
Page 7
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PROTOCOL NATIONAL LIMITED (CONTINUED)
This report is made solely to the Company's members
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 for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditor
Park View House
58 The Ropewalk
Nottingham
Date:
Page 8
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JULY 2019
Page 9
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
REGISTERED NUMBER:
03007851
BALANCE SHEET
AS AT
31 JULY 2019
The financial statements were approved and authorised for issue by the board and were signed on its behalf by
:
The notes on pages 13 to 29 form part of these financial statements.
Page 10
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 JULY 2019
STATEMENT OF CHANGES IN EQUITY
FOR THE 10 MONTH PERIOD ENDED
31 JULY 2018
Page 11
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2019
Page 12
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Protocol National Limited presents its financial statements for the year ended 31 July 2019. The Company is a private company, limited by shares and is registered in England. The Company's registered number is 03007851 and its registered office address is The Point, Welbeck Road, West Bridgford, Nottingham, NG2 7QW.
The principal activity of the Company is that of a lecturer and assessor recruitment agency in the Further Education sector. The financial statements have been presented in Pound Sterling as this is currency of the primary economic environment in which the Company operates and is rounded to the nearest thousand (£'000). A summary of the Company's accounting policies, which have been consistently applied, are set out below:
2.
Accounting policies
The financial statements have been prepared under the historical cost convention and in accordance with Financial Reporting Standard 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
This information is included in the consolidated financial statements of Protocol Holdings Limited as at 31 July 2019 and these financial statements may be obtained from The Point, Welbeck Road, West Bridgford, Nottingham, NG2 7QW.
Page 13
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
2.
Accounting policies (continued)
The company was in a strong position when it entered the COVID-19 crisis with a growing sales book and a robust balance sheet, having identified a clear strategy for future growth. Investment has been made to recruit experienced Recruitment Consultant staff to propel this growth and these have been retained, pending scaled business resumption. Liquidity is being maintained through strong cash management, ensuring there are no immediate cashflow concerns. All available Government assistance is been considered and utilised where appropriate. Directors are confident of a return to business levels consistent with the 7 months of positive trading experienced until COVID-19 impacted the economy together with a resumption of investing activities and are committed to a continuance of business.
Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit and loss account
except when deferred in other comprehensive income as qualifying cash flow hedges.
Page 14
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
2.
Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the lease term.
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
Finance costs are charged to the profit and loss account over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Page 15
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
2.
Accounting policies (continued)
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the profit and loss account when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the Company in independently administered funds.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.
Software is measured at cost less any accumulated amortisation and any accumulated impairment losses. Software is amortised on a straight line basis to the profit and loss account over its useful economic life of 10 years.
Page 16
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
2.
Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the profit and loss account.
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at transaction value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.
Page 17
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
2.
Accounting policies (continued)
Financial assets - Classified as basic instruments Financial assets are defined as cash or any asset from another entity, or a contractual right to receive cash or another financial asset from another entity, or a contractual right to exchange financial instruments with another entity under conditions that are potentially favourable, or an equity instrument of another entity. The category of financial assets held by the Company comprise of bank and cash balances, trade debtors and amounts owed by group undertakings. Debtors are assets with fixed or determinable payments that are not quoted on an active market, other than those that are categorised as financial assets at transaction value through profit and loss. These are initially recognised at the transaction price. At each balance sheet date, they are subsequently measured at amortised cost, with interest income recognised to profit and loss using the effective interest method. Financial liabilities - Classified as basic instruments Financial liabilities are defined as any liability that is contractual obligation to deliver cash or another financial asset to another entity, or to exchange financial instruments with another entity under conditions that are potentially unfavourable. Financial liabilities held by the Company comprise of trade creditors and amounts owed by group undertakings. Interest charges are recognised in profit and loss using the effective interest method. The only category of financial liability held by the Company is those measured at amortised cost using the effective interest method.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at transaction value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the balance sheet date.
Page 18
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
2.
Accounting policies (continued)
Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to the profit and loss account in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the balance sheet.
Preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not apparent from other sources. Actual results may differ from these estimates.
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 and in any future periods affected. Significant management judgements There are no management judgements in applying the accounting policies of the organisation that have had a significant effect on the amounts recognised in the financial statements. Estimation uncertainty The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. Useful economic lifes of intangible assets and tangible fixed asset s The annual amortisation/depreciation charge for intangible/tangible assets are sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are reassessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets. See Accounting Policy Note 2.10 and 2.11 for the useful economic lives for each class of assets.
Page 19
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Page 20
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Page 21
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Page 22
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Page 23
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
10.
Taxation (continued)
The main factor to consider is the decrease in tax rate. The standard rate of corporation tax rate in the UK is 19% for accounting periods from 1 April 2017. Following the introduction of The Finance Act 2016 a corporation tax rate of 17% will apply to accounting periods from 1 April 2020.
Page 24
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
12.
Intangible assets (continued)
Page 25
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Page 26
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
Page 27
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
The Company operates a defined contribution pension scheme, the assets of which are held separately from those of the Company in independently administered funds. The pension cost charge of £145k (2018: £129k) represents contributions payable by the Company funds. Contributions totalling £39k (2018: £3k) were included within creditors at the period end and subsequently paid to the fund.
Page 28
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROTOCOL NATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
The ultimate parent undertaking is Protocol Holdings Limited by virtue of their share holding in ELS Group Limited a company incorporated in England which is the smallest and largest group to consolidate these financial statements. Copies of the Group financial statements can be obtained from their registered office; The Point Welbeck Road, West Bridgford, Nottingham, England, NG2 7QW. Compass Partners Investments GC GP Limited have a majority shareholding in Protocol Holdings Limited. This shareholding is for the benefit of a number of investment vehicles managed by Compass Partners Investments GC Fund LP. In the opinion of the Directors there is no ultimate controlling party. Copies of the financial statements of these companies are available at; The Point Welbeck Road, West Bridgford, Nottingham, England, NG2 7QW.
Page 29
|