Company registration number 03382494 (England and Wales)
ROTHWELL PLUMBING SERVICES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
ROTHWELL PLUMBING SERVICES LIMITED
COMPANY INFORMATION
Directors
G W Rothwell
B Rothwell
Secretary
D Kirk
Company number
03382494
Registered office
Unit 3, Stephens Way
Warrington Road Industrial Estate
Goose Green
Wigan
Lancashire
WN3 6PH
Auditor
Cowgill Holloway LLP
Regency House
45-53 Chorley New Road
Bolton
BL1 4QR
Bankers
HSBC Bank Plc
1 Wallgate
Wigan
Lancashire
WN1 1LD
ROTHWELL PLUMBING SERVICES LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 22
ROTHWELL PLUMBING SERVICES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2022
- 1 -
The directors present the strategic report for the year ended 30 June 2022.
Fair review of the business
Rothwell Plumbing Services Limited is one of the Northwest's key plumbing and heating supply companies in the construction and building industry.
There have not been any significant changes to the company’s principal activities during the year under review. The Directors are not aware, at the date of this report, of any likely changes to the principal activities in the next year.
The company has continued to progress following the Covid restrictions that adversely affected the previous financial year with the result that profit before tax almost doubled to £158,000.
The business currently has a healthy order book across all of its divisions and continues to benefit from its expertise within the growing renewables sector where there is a significant amount of work available. The supply issues within this sector relating to the availability of air source heat pumps has held back sales in the year to 30 June 2022. These issues have largely been resolved in our current financial year such that trading continues to be very encouraging.
Principal risks and uncertainties
Liquidity Risk
The company seeks to manage financial risk by ensuring liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. Short-term flexibility is achieved by use of an overdraft facility.
Credit Risk
The principal credit risk arises from the company's trade debtors.
All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provisions are made for doubtful debts where necessary.
Future Developments
The company will continue to provide plumbing and heating services to the construction industry and continue with its progress to gain more profitable long term contracts, to maintain tighter controls over cost management and recoverability of debt, in order to improve profitability.
We will preserve and develop our relationships with incumbent clients, reach out for new clients and strive to improve our market share that will provide new sources of contribution.
We have positioned ourselves in readiness for the uptake of Government led renewable incentives and expect turnover in the domestic Air Source Heat Pump market to substantially increase.
Furthermore, Rothwell Plumbing Services Limited’s experience, skillset and focus lies within the construction sector that reduces the countries Co2 emissions, with select representation on the continued “GMCA Retrofit Task Force” chaired by Andy Burnham, Mayor of the Great Manchester Combined Authorities, an increasing strong current order book with a noticeable increase in low carbon technology opportunities. This has already yielded significant amounts of secured work with many further opportunities currently being tendered.
G W Rothwell
Director
29 March 2023
ROTHWELL PLUMBING SERVICES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2022
- 2 -
The directors present their annual report and financial statements for the year ended 30 June 2022.
Principal activities
The principal activity of the company in the year under review was that of plumbing and heating contractors.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
G W Rothwell
B Rothwell
J F J Pearson
(Resigned 5 November 2021)
Auditor
The auditor, Cowgill Holloway LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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 of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s
auditor
is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s
auditor
is aware of that information.
ROTHWELL PLUMBING SERVICES LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
- 3 -
On behalf of the board
G W Rothwell
Director
29 March 2023
ROTHWELL PLUMBING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ROTHWELL PLUMBING SERVICES LIMITED
- 4 -
Opinion
We have audited the financial statements of Rothwell Plumbing Services Limited (the 'company') for the year ended 30 June 2022 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including 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 30 June 2022 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.
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
Auditor's
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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the strategic report and the directors'
r
eport for the financial year for which the financial statements are prepared is consistent with the financial statements
; and
-
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
ROTHWELL PLUMBING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ROTHWELL PLUMBING SERVICES LIMITED
- 5 -
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 identifie
d
material misstatements in the strategic report or the directors'
r
eport
.
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
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 directors'
r
esponsibilities
s
tatement, 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.
Auditor's 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 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
.
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
.
ROTHWELL PLUMBING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ROTHWELL PLUMBING SERVICES LIMITED
- 6 -
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussions with the directors (as required by auditing standards) and discussed with the directors the policies and procedures regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. The potential effect of these laws and regulations on the financial statements varies considerably.
Firstly, Rothwell Plumbing Services Limited is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and taxation legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
Secondly, Rothwell Plumbing Services Limited is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation
or the loss of the company's license to operate. We identified the following areas as those most likely to have such an effect: laws related to the provision of plumbing and heating services the nature of the company's activities and the regulated nature of the company's activities.
.
Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and inspection of regulatory and legal correspondence, if any. Through these procedures we did not become aware of any actual or suspected non-compliance.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
We design procedures in line with our responsibilities, outlined below to detect material misstatement due to fraud:
-
Matters are discussed amongst the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud
-
Identifying and assessing the design and effectiveness of controls that management have in place to prevent and detect fraud
-
Detecting and responding to the risks of fraud following discussions with management and enquiring as to whether management have knowledge of any actual, suspected or alleged fraud;
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
ROTHWELL PLUMBING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ROTHWELL PLUMBING SERVICES LIMITED
- 7 -
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Helen Mills
Senior Statutory Auditor
For and on behalf of Cowgill Holloway LLP
29 March 2023
Chartered Accountants
Statutory Auditor
Regency House
45-53 Chorley New Road
Bolton
BL1 4QR
ROTHWELL PLUMBING SERVICES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2022
- 8 -
2022
2021
Notes
£
£
Turnover
3
14,502,657
12,228,326
Cost of sales
(11,792,885)
(9,751,863)
Gross profit
2,709,772
2,476,463
Administrative expenses
(2,546,159)
(2,413,926)
Other operating income
12,000
40,131
Operating profit
4
175,613
102,668
Interest receivable and similar income
7
951
Interest payable and similar expenses
8
(17,645)
(18,317)
Profit before taxation
158,919
84,351
Tax on profit
9
84,000
Profit for the financial year
158,919
168,351
The profit and loss account has been prepared on the basis that all operations are continuing operations.
ROTHWELL PLUMBING SERVICES LIMITED
BALANCE SHEET
AS AT
30 JUNE 2022
30 June 2022
- 9 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
10
44,799
49,402
Current assets
Stocks
11
37,684
32,595
Debtors
12
3,807,244
4,269,912
Cash at bank and in hand
178,140
436,848
4,023,068
4,739,355
Creditors: amounts falling due within one year
13
(2,513,093)
(3,296,760)
Net current assets
1,509,975
1,442,595
Total assets less current liabilities
1,554,774
1,491,997
Creditors: amounts falling due after more than one year
14
(302,496)
(398,638)
Net assets
1,252,278
1,093,359
Capital and reserves
Called up share capital
18
750
750
Capital redemption reserve
250
250
Profit and loss reserves
1,251,278
1,092,359
Total equity
1,252,278
1,093,359
The financial statements were approved by the board of directors and authorised for issue on 29 March 2023 and are signed on its behalf by:
G W Rothwell
Director
Company Registration No. 03382494
ROTHWELL PLUMBING SERVICES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022
- 10 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 July 2020
750
250
924,008
925,008
Year ended 30 June 2021:
Profit and total comprehensive income for the year
-
-
168,351
168,351
Balance at 30 June 2021
750
250
1,092,359
1,093,359
Year ended 30 June 2022:
Profit and total comprehensive income for the year
-
-
158,919
158,919
Balance at 30 June 2022
750
250
1,251,278
1,252,278
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2022
- 11 -
1
Accounting policies
Company information
Rothwell Plumbing Services Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
Unit 3, Stephens Way, Warrington Road Industrial Estate, Goose Green, Wigan, Lancashire, WN3 6PH.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares
publicly available consolidated financial statements
, including this company,
which are
intended to give a true and fair view of the assets, liabilities,
financial position and profit or loss
of the group
.
T
he company has
therefore
taken advantage of
e
xemptions from the following disclosure requirements:
The financial statements of the company are consolidated in the financial statements of
Rothwell Plumbing Services Group Limited
. These consolidated financial statements are available from Unit 3 Stephens Way, Warrington Road Industrial Estate, Wigan, Lancashire, WN3 6PH.
1.2
Going concern
The Directors have a reasonable expectation that the Company has adequate resources to continue
true
in operational existence for the foreseeable future. Thus, they continue to adopt the going concern
basis in preparing the annual financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business , and is shown net of VAT and other sales related taxes . The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that
it is probable will be
recover
ed
.
1.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 12 -
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
15% p.a reducing balance basis
Fixtures, fittings & equipment
15% p.a reducing balance basis
Computer Equipment
33.33% p.a straight line basis
Motor Vehicles
25% p.a reducing balance basis
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
1.5
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the
company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks
are stated at the lower of cost and
estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the
stocks
to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents include cash in han
d,
deposits held at call with banks
and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 13 -
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include
debtors
and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest
method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in
profit
or
loss
, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 14 -
Basic financial liabilities
Basic financial liabilities, including
creditors
, bank loans, loans from
fellow group companies and preference shares that are classified as debt, are
initially recognised at transaction price unless the arrangement constitutes a
financing transaction, where the debt instrument is measured at the present value of
the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities.
Trade creditors
are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in
profit
or
loss
in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value th
r
ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the
profit and loss account
because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred tax is recognised in respect of all timing differences which have originated but not reversed at the balance sheet date. Timing differences are differences between taxable profits and the results as stated in the financial statements which arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised in the financial statements.
A net deferred tax asset is regarded as recoverable and therefore recognised only when it can be regarded as more likely than not that there will be suitable taxable profits from which the future reversal of underlying timing differences can be deducted
.
Deferred tax is measured at the average tax rates which are expected to apply in the periods in which the timing differences are expected to reverse, based on tax rates and laws which have been enacted or substantively enacted by the balance sheet date. Deferred tax is measured on a non - discounted basis.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or
fixed assets
.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
1.14
Government grants
Government grants are recognised at the fair value of the asset receive
d
or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met
. Where a
grant does not specify performance conditions
it
is recognised in income when the proceeds are received or receivable
. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.15
Amounts recoverable on long term contracts, which are included in debtors, are stated at the net sales value of the work done after provision for contingencies and anticipated future losses on contracts, less amounts received as progress payments on account.
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
- 16 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are
as follows.
Long term contracts
The amounts recoverable on contracts at the year-end has been estimated by both the directors and key management of the Company, with respect to both the stage of completion and value of work completed, less any provision for contingencies and anticipated losses foreseen.
Provision for non-recovery of debts
Provisions for non-recovery of both trade debtors and amounts recoverable on contracts, has been estimated by both the directors and key management of the Company, based on their knowledge of the end customer and amounts received to date.
Tangible fixed assets
The useful economic life of tangible fixed assets has been estimated by the directors of the Company to ensure an appropriate depreciation charge is recognised in the year.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2022
2021
£
£
Turnover analysed by class of business
Plumbing and heating services
14,502,657
12,228,326
2022
2021
£
£
Turnover analysed by geographical market
United Kingdom
14,502,657
12,228,326
2022
2021
£
£
Other revenue
Interest income
951
-
Grants received
13,122
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
- 17 -
4
Operating profit
2022
2021
Operating profit for the year is stated after charging/(crediting):
£
£
Government grants
(13,122)
Fees payable to the company's auditor for the audit of the company's financial statements
11,000
10,000
Depreciation of owned tangible fixed assets
11,864
12,133
Operating lease charges
276,469
233,985
Government grants received in the previous year related to claims made for the Coronavirus Job Retention Scheme.
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Total
Their aggregate remuneration comprised:
2022
2021
£
£
Wages and salaries
3,745,085
3,209,742
Pension costs
705
2,760
3,745,790
3,212,502
Wages costs are recharged from a fellow group company.
6
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
91,546
213,260
Company pension contributions to defined contribution schemes
705
2,760
92,251
216,020
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2021 - 2).
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
6
Directors' remuneration
(Continued)
- 18 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2022
2021
£
£
Remuneration for qualifying services
n/a
117,803
7
Interest receivable and similar income
2022
2021
£
£
Interest income
Interest on bank deposits
951
8
Interest payable and similar expenses
2022
2021
£
£
Interest on bank overdrafts and loans
17,645
18,317
17,645
18,317
9
Taxation
2022
2021
£
£
Deferred tax
Origination and reversal of timing differences
(84,000)
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
9
Taxation
(Continued)
- 19 -
The actual charge/(credit) for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2022
2021
£
£
Profit before taxation
158,919
84,351
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
30,195
16,027
Tax effect of expenses that are not deductible in determining taxable profit
618
361
Change in unrecognised deferred tax assets
(33,794)
(104,431)
Adjustments in respect of prior years
(7,035)
Group relief
9,752
3,218
Permanent capital allowances in excess of depreciation
(414)
Depreciation on assets not qualifying for tax allowances
678
825
Taxation charge/(credit) for the year
-
(84,000)
The company has estimated capital losses of £
20,777
(2021: £20,777) available for carry forward against future capital gains.
The company has estimated trading losses of £1
,391,646
(202
1
: £1
,561,762
) available for carry forward against future income.
10
Tangible fixed assets
Plant and machinery
Fixtures, fittings & equipment
Computer Equipment
Motor Vehicles
Total
£
£
£
£
£
Cost
At 1 July 2021
49,231
73,595
136,278
141,618
400,722
Additions
2,452
4,809
7,261
At 30 June 2022
51,683
73,595
141,087
141,618
407,983
Depreciation and impairment
At 1 July 2021
28,107
60,593
130,323
132,297
351,320
Depreciation charged in the year
3,375
1,950
4,209
2,330
11,864
At 30 June 2022
31,482
62,543
134,532
134,627
363,184
Carrying amount
At 30 June 2022
20,201
11,052
6,555
6,991
44,799
At 30 June 2021
21,124
13,002
5,955
9,321
49,402
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
- 20 -
11
Stocks
2022
2021
£
£
Finished goods and goods for resale
37,684
32,595
12
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
1,348,506
1,264,139
Gross amounts owed by contract customers
1,668,110
2,011,931
Corporation tax recoverable
259
259
Amounts owed by group undertakings
258,979
430,177
Amounts owed by undertakings in which the company has a participating interest
258,916
343,907
Prepayments and accrued income
188,474
135,499
3,723,244
4,185,912
Deferred tax asset (note 16)
84,000
84,000
3,807,244
4,269,912
Amounts owed by group undertakings are unsecured, interest free and repayable on demand.
13
Creditors: amounts falling due within one year
2022
2021
Notes
£
£
Bank loans
15
102,972
102,277
Trade creditors
1,636,926
1,482,274
Amounts owed to group undertakings
230,628
607,036
Taxation and social security
80,310
86,420
Other creditors
132,944
92,138
Accruals and deferred income
329,313
926,615
2,513,093
3,296,760
Amounts owed to group undertakings are unsecured, interest free and repayable on demand.
14
Creditors: amounts falling due after more than one year
2022
2021
Notes
£
£
Bank loans and overdrafts
15
302,496
398,638
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
- 21 -
15
Loans and overdrafts
2022
2021
£
£
Bank loans
405,468
500,915
Payable within one year
102,972
102,277
Payable after one year
302,496
398,638
Bank borrowings are secured by a fixed and floating charge over the assets of Rothwell Plumbing Services Limited.
A bank loan for £307,500 was taken out in October 2015. Repayments of £3,041.46 are payable each month, the interest charged on the loan is 3% above the Bank of England Base Rate. The loan is expected to repaid in full ten years from the initial drawdown date and is secured on the property.
16
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Assets
Assets
2022
2021
Balances:
£
£
Tax losses
84,000
84,000
There were no deferred tax movements in the year.
17
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
705
2,760
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
18
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 1 each
750
750
750
750
ROTHWELL PLUMBING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2022
- 22 -
19
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2022
2021
£
£
Within one year
67,261
55,899
Between two and five years
99,387
128,314
166,648
184,213
20
Related party transactions
The company has taken advantage of the exemption available in accordance with FRS
102 1.12(e),
not to disclose transactions entered into between two or more members of a group, as the company is a wholly owned subsidiary undertaking of the group to which it is party to the transactions.
21
Ultimate controlling party
The
ultimate parent company is considered to be
Rothwell Plumbing Services Group Limited
, a company registered in England & Wales
.
The smallest and largest group of companies for which consolidated group accounts are available
is that headed by
Rothwell Plumbing Services Group Limited
. Copies of the parent's consolidated financial statements may be
obtained from Companies House, Cardiff, CF14 3UZ.
The ultimate controlling party is considered to be B Rothwell and G W Rothwell, by virtue of their combined majority shareholding in Rothwell Plumbing Services Group Limited.
2022-06-30
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