Registered number:
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
COMPANY INFORMATION
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SQW GROUP LIMITED
CONTENTS
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SQW GROUP LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2020
The annual report and financial statements presented here are for SQW Group Limited (‘the Company’) and its subsidiaries (together ‘the Group’) and, with the exception of intercompany balances held, do not reflect the Group’s acquisition, on 29 November 2018, by SQW Group Newco 2018 Limited who became SQW Group’s ultimate controlling party on this date.
The principal activity of the Company during the year was that of an intermediate holding company. The activities of the Group during the year were the provision of economic and social development consultancy services, business coaching and support, the management of innovation centres and the facilitation of investment into early stage businesses.
The Board were pleased with the Group’s performance in 2019/20 which – in generating post tax profit for the financial year of £269,560 – was in line with budgeted expectations for the Group overall. The result represented a decrease of £105,879 over the prior year. Excluding the impact of varying levels of carried interest income received each year, this result actually represented an increase in profit from core trading activities of £85,770.
COVID-19 was announced as a global pandemic on 11th March 2020. Whilst the resulting impact of this was before the end of the 2019/20 financial year – in particular with the UK lockdown being announced on 23rd March – the results for the group to 31st March 2020 were not materially impacted. The effect on trading during 2020/21 is expected to be far more significant. Nonetheless the Group’s viability is not in question due to government support measures and actions taken by the Group to mitigate the pandemic’s impact. Returning to 2019/20, SQW (the consultancy business) had good year with growth in turnover of 11% (further building on last year’s growth of 13%). The team (which included enhanced land and property expertise for the full year following integration with BBP Regeneration in early 2019), maintained their strong order book throughout the year and delivered high-quality work efficiently, as demonstrated by the 2% improvement in gross profit margin. The 54-strong team’s confidence is tempered by the short-term impact of COVID-19 as they look to the year ahead. However, longer term prospects appear to be strong and, along with the Board, they look forward to being in a position to regain their momentum in the years ahead. Indeed, the nature of SQW’s services, as they relate to advising on economic development, the recovery of local areas and regions, and the evaluation of public programmes that support social and economic vitality, is more relevant than ever. Whilst Oxford Innovation Services ('OIS') generally operates in a low margin, publicly funded programmes, the team have made progress over the past 12 months in carving out niches in new areas of privately funded work on more commercial terms – notably expanding their GROWTHmapper product set and clienteles. At the start of the year, the Board were delighted to welcome the Melton Mowbray-based team from Economic Growth Solutions, who joined OIS to deliver the newly won next phase of the highly successful Manufacturing Growth Programme, supporting annually well over 1,000 businesses, making it the largest programme of support to SME manufacturers in the country. The enlarged 117-strong OIS team continue to provide high quality coaching and business support for high-growth SMEs across the UK, from Kent, to Yorkshire to Cornwall and serving pretty much all the Local Enterprise Partnership areas in between - and generate significant economic benefit through continued successful delivery across all their programmes. The Board were pleased that, even in the current challenging, and uncertain funding environment, Oxford Innovation Services delivered turnover growth of 33% over last year and generated a three-fold improvement in operating profit to £131,992 in 2019/20. The Group incorporated a new company, Intelligent Connections Limited, during the year whose aim is to provide an additional level of support to SMEs – from across the Group network - by connecting them with relevant, growth-enhancing service providers. The company is still in its’ infancy with 2019/20 seeing the launch of a pilot phase of services related specifically to R&D tax software services.
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SQW GROUP LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2020
Oxford Investment Opportunity Network ('OION') continues to unite exciting young businesses with keen investors across the UK; a highly regarded service which complements work with SMEs in other parts of the group. OION’s income consists of commissions paid when investments are made – and it is hard to predict which opportunities will attract the offers of investment – and carried interest in the performance of various investments on those occasions where is holds such an interest. The former income tends to ensure that OION covers its costs and the latter represents episodic ‘upside’ of limited predictability. During 2019/20 the company generated total revenues of £258,153 (2018/19: £634,428) which included £156,275 received as a result of the second tranche of carried interest held in a fund which achieved a successful exit during the prior year.
The Innovation Centres division, Oxford Innovation ('OI'), had a busy year in 2019/20 which included three new-build centres joining the portfolio (two in Oxford and one at the University of Essex) and one centre leaving at the end of its contracted period. Material investment of time and money was made during the year in successfully implementing a new and more resilient and adaptable customer IT platform – via essensys - across the majority of centres in the portfolio. The Board were also delighted to welcome the strengthening of OI’s management team with Tim Smith MBE joining as Deputy Managing Director in December. Turnover grew by 1% to £6,134,182 with operating profit reducing slightly to £16,699 in 2019/20. COVID-19 will inevitably impact OI during 2020/21 and possibly beyond. The Board have confidence in the team’s ability to steer the business through the short-to medium-term challenges this will create and believe this is essential in order to enable OI to take advantage of the division’s continued strong pipeline of new centre opportunities over the next few years. Overall, the Board are cautious about the 2020/21 year because of the inevitable disruption caused by the COVID-19 pandemic but remain optimistic about the medium and long-term opportunities. The regeneration skills and experience of both SQW and OIS are likely to be in high demand to assist in the economic transformation that will be needed if the UK is to recover from COVID-19 and OION should also be ideally placed to help stimulate much needed investment for SMEs seeking opportunities to grow. The innovation-centres market of OI is more uncertain though its customers’ businesses tend to be in sectors least affected by the pandemic who will also, more than ever, value OI’s business support expertise.
The Group is exposed to a variety of financial risks resulting from its operating activities. The board is responsible for determining the group’s financial risk management policy and focuses on securing the Group’s cash flows.
The Group does not actively engage in the trading of financial assets and has no financial derivatives. The most significant risks to which the Group is exposed to are described below: Credit Risk The Group’s credit risk is primarily attributable to its trade debtors. The amounts presented in the balance sheet are net of any allowance for doubtful debts, as estimated by the directors. The Group has no significant concentration of credit risk, with exposure spread over a large number of customers. Cash Flow Risk The Group seeks to manage risks to ensure sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. Short term flexibility is achieved by Management actively monitoring future cash flow requirements on a regular basis. Interest rate risk As a result of cross-guarantees in place with its ultimate parent company, SQW Group Newco 2018 Limited (‘Newco’), the Group is exposed to a level of interest rate risk following a £0.5m debt facility that was put in place between Newco and HSBC during the year. Interest on the loan is payable monthly and is at a variable rate of interest. Whilst the group has adequate headroom in terms of interest cover to comfortably meet modest rises in interest rates, the monthly interest payment commitment does represent an element of exposure for the Group whilst the 4-year facility is in place.
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SQW GROUP LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2020
Group turnover for the year to 31 March 2020 was £19,707,068 (2019: £17,453,395).
Group gross profit for the year was £4,095,789 (2019: £4,271,989). Group operating profit for the year was £351,388 (2019: £527,913). Group profit on ordinary activities before taxation for the year was £351,638 (2019: £527,913). Earnings per share based on retained profit for the year to 31 March 2020 (the standard method of calculation) was 1.7p (2019: 2.4p) and based on profits before tax, 2.2p (2019: 3.3p). Group cash at bank at 31 March 2020 was £1,797,861 (2019: £2,228,474). Net Current Assets increased from £4,446,125 in 2019 to £5,573,090.
The Group does not currently monitor any non-financial performance indicators.
This report was approved by the board on 26 August 2020
and signed on its behalf.
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SQW GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2020
The directors present their report and the financial statements for the year ended 31 March 2020.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the
consolidated
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year
. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙
select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙
make judgments 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 Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £
269,560
(2019 -
£
375,439
)
.
No final dividend is proposed by the directors for the year ended 31 March 2020 and, as previously notified to shareholders, no interim dividend is expected to be recommended.
The directors who served during the year were:
Each of the persons who are
directors at the time when this Directors' Report is approved has confirmed that:
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SQW GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2020
On 11th March 2020 COVID-19 was declared a global pandemic. Although this was declared before the Balance Sheet date, the economic impact of COVID-19 continues to be felt beyond this date. The directors have carefully considered the impact of COVID-19 on these accounts prepared to 31 March 2020; notably the appropriateness of accounting estimates used and any significant assumptions made, including projected cash flows.
Otherwise there have been no material developments or events which have occurred after the balance sheet date.
The auditor, James Cowper Kreston, will be proposed for reappointment in accordance with
section 485 of the Companies Act 2006.
This report was approved by the board on
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SQW GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SQW GROUP LIMITED
We have audited the financial statements of SQW Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2020, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity
and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards,
including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
∙
the directors
' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
∙
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Group's or the parent Company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
The directors are responsible for the other information. The other information comprises the information included in the Annual Report, other than the financial statements and our Auditor's Report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
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SQW GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SQW GROUP LIMITED (CONTINUED)
required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙
the information given in the Group Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙
the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
As explained more fully in the Directors' Responsibilities Statement on page 4, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.
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SQW GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SQW GROUP LIMITED (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditor's Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms part of our Auditor's Report.
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.
for and on behalf of
Chartered Accountants and Statutory Auditor
2 Chawley Park
Cumnor Hill
Oxfordshire
OX2 9GG
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SQW GROUP LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
REGISTERED NUMBER:
04947276
CONSOLIDATED BALANCE SHEET
AS AT
31 MARCH 2020
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 26 August 2020
.
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SQW GROUP LIMITED
REGISTERED NUMBER:
04947276
COMPANY BALANCE SHEET
AS AT
31 MARCH 2020
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
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SQW GROUP LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 MARCH 2020
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SQW GROUP LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 MARCH 2020
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SQW GROUP LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
1.
Accounting policies
SQW Group Limited is a limited liability company incorporated in the United Kingdom and registered in England & Wales. The Company's registered office is Oxford Centre for Innovation, New Road Oxford OX1 1BY.
The principal activity of the Company is that of a holding company.
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 2).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are, therefore, eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases. In accordance with the transitional exemption available in FRS 102, the group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 01 April 2014.
The COVID-19 pandemic has impacted the business since the date of these accounts. Detailed forecasts have been prepared and continue to be updated as trading continues and the pandemic unfolds. As a result of this ongoing work, and mitigation measures taken, the Directors currently have no reason to believe that the pandemic will have an impact on the Group’s ability to continue trading as a going concern.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
1.
Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
When losses are anticipated on projects, the loss is recognised in full during the year in which it is first foreseen.
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
1.
Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
Investments in subsidiaries are measured at cost less accumulated impairment.
An entity is treated as an associated undertaking where the Group exercises significant influence in that it has the power to participate in the operating and financial policy decisions.
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The Consolidated Statement of Comprehensive Income includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated Statement of Financial Position, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition.
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
1.
Accounting policies (continued)
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated Statement of Comprehensive Income in the same period as the related expenditure.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
1.
Accounting policies (continued)
Functional and presentation currency
The Group's functional and presentational currency is GBP, rounded to the nearest pound.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Provisions are made where an event has taken place that gives the Group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the Balance Sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
1.
Accounting policies (continued)
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Balance Sheet date, except that:
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amount reported for assets and liabilites as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements (apart from those involving estimates) have had the most significant effects on amounts recognised in the financial statements.
Revenue recognition (note 3) Revenue and costs have been recognised based on management's assessment of the stage of completion for each project, taking into account the amounts repayable to customers. Taxation (note 9) Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit will be available against the losses can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that ban be recognised, based upon likely timing and the level of future taxable profits, together with future planning strategies. Contract obligations (note 17) The directors have considered the obligations arising from contracts and have provided for liabilities where costs can be reliably estimated.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
Analysis of turnover by country of destination:
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
9.
Taxation (continued)
The Finance Act 2016 enacted a reduction in the main rate of corporation tax from 19% to 17% from 1 April 2020. As this change of rate was enacted at the balance sheet date then deferred tax balances have been stated at a rate of 17%. On 17 March 2020 the Government announced their intention to cancel this reduction in the corporation tax rate. As a result the deferred tax timing differences are expected to reverse at 19%.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
11.
Tangible fixed assets (continued)
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
Share premium account
Capital redemption reserve
Share based payment reserve
Merger reserve
Profit & loss account
A prior year adjustment of £69,840 has been made to correctly account for the tax position as at 31 March 2019 in Oxford Innovation Services Limited. The impact of this adjustment is to decrease other debtors and profit for the year by £69,840.
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £337,569 (2019: £311,873). Contributions totalling £77,806 (2019: £66,424) were payable to the fund at the balance sheet date and are included in creditors.
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SQW GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2020
23.
Other financial commitments
There is a Group guarantee in favour of the Bank from SQW Group Limited, SQW Group Newco 2018 Limited, Oxford Innovation Limited, SQW Limited and Oxford Innovation Services Limited guaranteeing the obligations of each other to the Bank.
There is also a debenture comprising fixed and floating charges over all the assets and undertakings of SQW Group Newco 2018 Limited including all present and future freehold and leasehold property, book and other debts, chattels, goodwill and uncalled capital, both present and future. Otherwise there have been no material developments or events which have occurred after the balance sheet date.
The ultimate controlling undertaking is SQW Group Newco 2018 Limited, a company registered in England and Wales, by virtue of its 100% shareholding in the Company.
The consolidated statements of SQW Group Newco 2018 Limited and SQW Group Limited are both publically available from Oxford Centre for Innovation, New Road, Oxford, OX1 1BY.
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