VERACITY SYSTEMS LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
Company Registration No. 04316461 (England and Wales)
PAGES FOR FILING WITH REGISTRAR
VERACITY SYSTEMS LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 7
VERACITY SYSTEMS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2018
31 December 2018
- 1 -
2018
2017
Notes
£
£
£
£
Fixed assets
Tangible assets
3
45,832
57,436
Investments
4
149,774
25,534
195,606
82,970
Current assets
Stocks
27,659
6,862
Debtors
5
395,142
477,520
Cash at bank and in hand
241,523
106,494
664,324
590,876
Creditors: amounts falling due within one year
6
(379,081)
(525,044)
Net current assets
285,243
65,832
Total assets less current liabilities
480,849
148,802
Capital and reserves
Called up share capital
7
356,900
356,900
Profit and loss reserves
123,949
(208,098)
Total equity
480,849
148,802
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.
true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 10 May 2019 and are signed on its behalf by:
Mr David Corson B.Acc.,CA
Mr Alastair McLeod BSc (Hons)
Director
Director
Company Registration No. 04316461
VERACITY SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
- 2 -
1
Accounting policies
Company information
Veracity Systems Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Unit 5, Courtyard 31, Pontefract Road, Normanton, WF6 1JU.
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. 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:
-
Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares
;
-
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash
f
low and related notes and disclosures
;
-
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income
;
-
Section 26 ‘Share based Payment’ – Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements
;
-
Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel
.
The financial statements of the company are consolidated in the financial statements of Veracity UK Limited. These consolidated financial statements are available from its registered office, 4 Dow Road, Monkton, Prestwick, KA9 2TU.
The company has taken advantage of the exemption under section
399
of the
Companies Act 2006 not to prepare consolidated accounts
, on the basis that the group of which this is the parent qualifies as a small group
. The financial statements present information about the company as an individual entity and not about its group
.
VERACITY SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
1
Accounting policies
(Continued)
- 3 -
1.2
Turnover
Turnover comprises the invoiced value of goods and services supplied and licence income for access to software and hosted hardware, exclusive of Value Added Tax. Licence income is recognised over the contractual period access and help desk support is provided.
Revenue on the sale of hardware and third party software, where no significant vendor obligations exist, is recognised on despatch. Revenue on non-standard software or where significant vendor obligations exists is recognised on customer acceptance.
Revenue from the sale of software is recognised at the time the software licence is granted, in accordance with agreed contract milestones such as installation at customer location. Revenues for support and maintenance services are recognised proportionately over the period that the services are provided. Payments received in advance of services are recorded in the balance sheet as deferred income.
Revenue from professional services (project management, consultancy and training) is recognised as the service provided.
1.3
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated
.
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.
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:
Leasehold improvements
20% straight line
Plant and machinery
33% straight line
Fixtures, fittings & equipment
33% straight line
Computer equipment
33% 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
.
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company
. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
1.6
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.
VERACITY SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
1
Accounting policies
(Continued)
- 4 -
1.7
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.
1.8
Cash at bank and in hand
Cash at bank and in hand
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.
1.9
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.
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.
1.10
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.
VERACITY SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
1
Accounting policies
(Continued)
- 5 -
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 income 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 asset are consumed.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was 12 (2017 - 9).
3
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2018
48,226
129,309
177,535
Additions
1,432
7,991
9,423
Disposals
-
(92,602)
(92,602)
At 31 December 2018
49,658
44,698
94,356
Depreciation and impairment
At 1 January 2018
9,115
110,983
120,098
Depreciation charged in the year
9,716
11,312
21,028
Eliminated in respect of disposals
-
(92,602)
(92,602)
At 31 December 2018
18,831
29,693
48,524
Carrying amount
At 31 December 2018
30,827
15,005
45,832
At 31 December 2017
39,111
18,325
57,436
VERACITY SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 6 -
4
Fixed asset investments
2018
2017
£
£
Investments
149,774
25,534
Movements in fixed asset investments
Shares in group undertakings
£
Cost or valuation
At 1 January 2018
25,534
Additions
124,240
At 31 December 2018
149,774
Carrying amount
At 31 December 2018
149,774
At 31 December 2017
25,534
5
Debtors
2018
2017
Amounts falling due within one year:
£
£
Trade debtors
310,949
416,299
Amounts owed by group undertakings
74,641
48,231
Other debtors
9,552
12,990
395,142
477,520
6
Creditors: amounts falling due within one year
2018
2017
£
£
Trade creditors
14,731
92,358
Amounts owed to group undertakings
161,302
252,101
Taxation and social security
90,718
66,803
Other creditors
112,330
113,782
379,081
525,044
VERACITY SYSTEMS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 7 -
7
Called up share capital
2018
2017
£
£
Ordinary share capital
Issued and fully paid
356,900 Ordinary A Shares of £1 each
356,900
356,900
356,900
356,900
8
Audit report information
As the income statement has been omitted from the filing copy of the financial statements the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006
:
The auditor's report was unqualified.
The senior statutory auditor was Mr John Wallace.
The auditor was William Duncan + Co Ltd.
9
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2018
2017
£
£
59,128
74,923
10
Parent company
The ultimate parent company of
Veracity Systems
Limited is Veracity UK Limited, a company incorporated in Scotland.