REGISTERED NUMBER: |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
FOR |
CHALLENGE-TRG SKILLS LIMITED |
REGISTERED NUMBER: |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
FOR |
CHALLENGE-TRG SKILLS LIMITED |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
Page |
Balance Sheet | 1 |
Notes to the Financial Statements | 2 |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
BALANCE SHEET |
31 MARCH 2023 |
31.3.23 | 31.3.22 |
as restated |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 4 |
Tangible assets | 5 |
CURRENT ASSETS |
Debtors | 6 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 7 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 9 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 10 |
Retained earnings | 930,812 |
SHAREHOLDERS' FUNDS |
In accordance with Section 444 of the Companies Act 2006, the Statement of Comprehensive Income has not been delivered. |
The financial statements were approved by the Board of Directors and authorised for issue on |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 MARCH 2023 |
1. | STATUTORY INFORMATION |
Challenge-TRG Skills Limited is a |
Registered number: |
Registered office: |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
The financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons. |
At 31 March 2023, the company had net assets of £685k (2022: £931k, as restated) and recorded net current assets amounting to £567k (2022: £802k, as restated), indicating that the business has sufficient resources to settle its debts as and when they fall due.The company recorded a net loss for the year ended 31 March 2023 of £246k (2022: loss of £489k, as restated).The company is forecasted to return to profit in the year ended 31 March 2024. |
The directors have prepared cash flow forecasts for the company covering a period of at least twelve months from the date of approval of these financial statements. Applying prudent forecasting assumptions around revenue and profitability, operating cash conversion and the like, the directors' forecasts indicate that the company will generate sufficient liquidity to continue in operation. |
The company finances its trade principally through the use of an invoice finance facility. Further to the production of the aforementioned forecasts, the directors consider that the headroom of the existing invoice finance facility will be more than adequate to facilitate the company's projected trade volumes. |
As a result of the above factors, the directors consider that the company will continue to have sufficient funds to meet its liabilities as they fall due for at least twelve months from the date of approval of the financial statements, and have therefore prepared the financial statements on a going concern basis. |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. |
The Skills division provides government funded and commercial training courses to learners. Government funded courses commonly last over multiple trading periods with payments based on stage of completion (typically, an element of the funding is paid at commencement, a further element is paid in relation to a learner's progress and, in some circumstances, a final element is paid on successful completion of the course) or job outcome (where the purpose of the course is to ensure learners achieve gainful employment). Revenue is therefore recognised in line with the stage of completion. |
Accrued income is recognised when the risks and rewards have been passed to the customer and relates to balances which have become receivable from government but for which invoices are not raised (course data is provided to government via an online portal and payments are ordinarily received the following month). |
In addition, the Skills Division provides 'matched funding' courses. Under these arrangements, the government will effectively match the cost of provision of certain courses. Typically, eligible costs comprise the costs of the training staff plus an additional 40% of staff permitted in relation to indirect costs. The matched funding is recognised as revenue at the point the associated costs are paid. |
Commercial training revenue is recognised at the point of course delivery. Invoices are raised in relation to this supply and, consequently, accrued income is not recognised in this area. |
Intangible assets |
Intangible assets relating to the capitalisation of costs developing the online software are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses. |
The amortisation period commences from the date on which the asset is brought into use. |
Amortisation 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: |
Computer software - 3 years straight line |
Tangible fixed assets |
Plant and machinery | - |
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses. |
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. |
Impairment of fixed assets |
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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. |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
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 statement of financial position 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, 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 and loans from fellow group companies 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised. |
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. |
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. Amounts 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. |
Cash and cash equivalents |
Cash and cash equivalents are basic financial assets and include cash in hand and bank overdrafts. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
2. | ACCOUNTING POLICIES - continued |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Employee benefits |
The costs of short-term employee benefits are recognised as a liability and an expense. |
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. |
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. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
3. | EMPLOYEES AND DIRECTORS |
The average number of employees during the year was |
4. | INTANGIBLE FIXED ASSETS |
Computer |
software |
£ |
COST |
At 1 April 2022 |
Additions |
At 31 March 2023 |
AMORTISATION |
At 1 April 2022 |
Amortisation for year |
At 31 March 2023 |
NET BOOK VALUE |
At 31 March 2023 |
At 31 March 2022 |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
5. | TANGIBLE FIXED ASSETS |
Plant and |
machinery |
£ |
COST |
At 1 April 2022 |
Additions |
At 31 March 2023 |
DEPRECIATION |
At 1 April 2022 |
Charge for year |
At 31 March 2023 |
NET BOOK VALUE |
At 31 March 2023 |
At 31 March 2022 |
6. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.3.23 | 31.3.22 |
as restated |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
7. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.3.23 | 31.3.22 |
as restated |
£ | £ |
Trade creditors |
Amounts owed to group undertakings |
Taxation and social security |
Other creditors |
HSBC UK Bank plc has fixed and floating charges over the assets of the company, dated 11 March 2019. |
HSBC Bank plc also has a multilateral guarantee across all group companies. |
HSBC Invoice Finance (UK) Ltd has a fixed and floating charge over the assets of the company dated 1 July 2019. |
Praetura Debt Limited has fixed and floating charges and a negative pledge over the assets of Challenge Group Holdings Limited and its subsidiary undertakings, dated 29 April 2019. |
Close Brothers Limited has fixed and floating charges over the assets of the Challenge Group Holdings Limited and its subsidiary undertakings, dated 17 November 2022. |
CHALLENGE-TRG SKILLS LIMITED (REGISTERED NUMBER: 04819289) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 MARCH 2023 |
8. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
31.3.23 | 31.3.22 |
as restated |
£ | £ |
Within one year |
Between one and five years |
9. | PROVISIONS FOR LIABILITIES |
31.3.23 | 31.3.22 |
as restated |
£ | £ |
Deferred tax | 38,882 | 29,457 |
Deferred |
tax |
£ |
Balance at 1 April 2022 |
Charge to Statement of Comprehensive Income during year |
Balance at 31 March 2023 |
The deferred tax provision of £38,882 includes a credit balance of £39,238 in respect of accelerated capital allowances and a debit balance of £356 in respect of short term timing differences. |
10. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 31.3.23 | 31.3.22 |
value: | as restated |
£ | £ |
Ordinary | £1 | 1 | 1 |
11. | DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006 |
The Report of the Auditors was unqualified. |
For and on behalf of |
12. | CONTROLLING PARTY |
Challenge Recruitment Group Limited is the immediate parent of the company. Challenge Group Holdings Limited is the ultimate controlling party of the company. |
Challenge Group Holdings Limited is the largest and smallest group in which Challenge-TRG Skills Limited is a member and for which consolidated financial statements are prepared and publicly available. A copy of the group financial statements can be obtained from Challenge Group Holdings Limited, 1 Smithy Court, Smithy Brook Road, Wigan, WN3 6PS. |