Company Registration No. 03547108 (England and Wales)
MERLIN ENERGY RESOURCES LIMITED
ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
PAGES FOR FILING WITH REGISTRAR
MERLIN ENERGY RESOURCES LIMITED
COMPANY INFORMATION
Directors
Dr William Wilks
Mrs H D Bone
(Appointed 3 August 2021)
Secretary
Fiona Lawrance
Company number
03547108
Registered office
Newberry House
New Street
Ledbury
HR8 2EJ
Accountants
Kendall Wadley LLP
Granta Lodge
71 Graham Road
Malvern
Worcestershire
WR14 2JS
Bankers
NatWest
12 Broad Street
Hereford
HR4 9AH
MERLIN ENERGY RESOURCES LIMITED
CONTENTS
Page
Directors' report
1
Balance sheet
2 - 3
Notes to the financial statements
4 - 10
MERLIN ENERGY RESOURCES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
- 1 -
The directors present their annual report and financial statements for the year ended 31 December 2021.
Principal activities
The principal activity of the company continued to be that of the provision of exploration consultancy and data storage facilities for the oil exploration industry and associated business.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Dr Andrew Sims
(Resigned 20 October 2021)
Dr William Wilks
Mrs H D Bone
(Appointed 3 August 2021)
Small companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
By order of the board
Fiona Lawrance
Mrs H D Bone
Secretary
Director
14 July 2022
MERLIN ENERGY RESOURCES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2021
31 December 2021
- 2 -
2021
2020
Notes
£
£
£
£
Fixed assets
Tangible assets
5
416,105
436,529
Investments
6
182,250
110,970
598,355
547,499
Current assets
Stocks
148
1,207
Debtors
7
272,689
225,670
Cash at bank and in hand
875,830
481,541
1,148,667
708,418
Creditors: amounts falling due within one year
8
(166,504)
(58,025)
Net current assets
982,163
650,393
Total assets less current liabilities
1,580,518
1,197,892
Creditors: amounts falling due after more than one year
9
(220,833)
Provisions for liabilities
(451)
Net assets
1,359,234
1,197,892
Capital and reserves
Called up share capital
10
18,863
18,863
Revaluation reserve
11
233,915
240,823
Capital redemption reserve
12
31,137
31,137
Profit and loss reserves
1,075,319
907,069
Total equity
1,359,234
1,197,892
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.
true
For the financial year ended 31 December 2021 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
T
he members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476
.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
MERLIN ENERGY RESOURCES LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 DECEMBER 2021
31 December 2021
- 3 -
The financial statements were approved by the board of directors and authorised for issue on 14 July 2022 and are signed on its behalf by:
Mrs H D Bone
Director
Company Registration No. 03547108
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
- 4 -
1
Accounting policies
Company information
Merlin Energy Resources Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
Newberry House, New Street, Ledbury, HR8 2EJ.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Turnover
Turnover represents amounts receivable for goods and services net of VAT. Turnover is recognised when the service or good is provided.
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
.
1.3
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.
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:
Land and buildings
25 years straight line
Plant and machinery
2 years straight line / 15% straight line
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
.
1.4
Fixed asset investments
Listed investments
are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in
profit
or
loss
. Transaction costs are expensed to
profit
or
loss
as incurred.
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 5 -
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.
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 labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
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.
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.
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 6 -
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.
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.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the
profit and loss account
, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
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.
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
1
Accounting policies
(Continued)
- 7 -
1.12
Retirement benefits
The pension costs charged in the financial statements represent the contributions payable by the company in the year.
1.13
Leases
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
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
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
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.
3
Exceptional item
2021
2020
£
£
Expenditure
Employee ownership trust
-
3,758
During the year to 31st December 2016 a commitment was made to pay a gift of £1,621,375 over a five year period by Merlin Energy Resources Limited to Merlin Energy Employee Ownership Trust.
No payments were due during the year
. The balance outstanding as at 31st December 202
1
was nil
(2020 - nil)
. Additional payments of £3
,
758 were due
in 2020
to the Trust which represents interest payable by the Trust to the shareholders. This amount is included as an administrative expense in the accounts but
was
added back in the
2020
tax computation, as the amount is not allowable for tax relief.
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 8 -
4
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2021
2020
Number
Number
Total
12
15
5
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost or valuation
At 1 January 2021
594,000
314,007
908,007
Additions
7,741
7,741
At 31 December 2021
594,000
321,748
915,748
Depreciation and impairment
At 1 January 2021
161,100
310,378
471,478
Depreciation charged in the year
23,760
4,405
28,165
At 31 December 2021
184,860
314,783
499,643
Carrying amount
At 31 December 2021
409,140
6,965
416,105
At 31 December 2020
432,900
3,629
436,529
T
he Colwall freehold land and buildings were valued on an open market basis by John Goodwin, an independent external Chartered Surveyor on
30 May 2019
. The directors believe this valuation is a fair value of the property at the year end. The historic cost of this freehold property is £157,702.
Newberry House was valued on an open market basis by John Goodwin, an independent external Chartered Surveyor on
30
May 201
9
. The directors believe this valuation is a fair value of the property at the year end. The historic cost of the property is £295,147.
6
Fixed asset investments
2021
2020
£
£
Other investments other than loans
182,250
110,970
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
6
Fixed asset investments
(Continued)
- 9 -
Movements in fixed asset investments
Investments
£
Cost or valuation
At 1 January 2021
110,970
Valuation changes
71,280
At 31 December 2021
182,250
Carrying amount
At 31 December 2021
182,250
At 31 December 2020
110,970
7
Debtors
2021
2020
Amounts falling due within one year:
£
£
Trade debtors
236,778
163,799
Corporation tax recoverable
23,114
Other debtors
35,911
38,757
272,689
225,670
8
Creditors: amounts falling due within one year
2021
2020
£
£
Bank loans
29,167
Trade creditors
47,080
25,744
Corporation tax
24,564
Other taxation and social security
22,503
11,178
Other creditors
43,190
21,103
166,504
58,025
9
Creditors: amounts falling due after more than one year
2021
2020
£
£
Bank loans and overdrafts
220,833
MERLIN ENERGY RESOURCES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
- 10 -
10
Called up share capital
2021
2020
£
£
Ordinary share capital
Issued and fully paid
18,863 Ordinary shares of £1 each
18,863
18,863
11
Revaluation reserve
2021
2020
£
£
At the beginning of the year
240,823
282,369
Transfer to retained earnings
(6,908)
(41,546)
At the end of the year
233,915
240,823
12
Capital redemption reserve
2021
2020
£
£
At the beginning and end of the year
31,137
31,137
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false
14 July 2022
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Dr Andrew Sims
Dr Andrew Sims
Mrs H D Bone
Fiona Lawrance
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