Company Registration Number
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
COMPANY INFORMATION
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
CONTENTS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
GROUP STRATEGIC REPORT
FOR THE PERIOD ENDED 30 JUNE 2023
The directors present their strategic report for the year ended 30 June 2023.
Heat Exchange Group Limited is the parent company of Greens Power Limited and Heat Exchange Group Services Limited. Green's designs, manufactures and provides aftermarket services for industrial boiler equipment including economisers, heat exchangers and heat recovery systems that can be found throughout the world. Its primary markets are energy (including biomass, waste to energy and conventional fuels) industrial, petrochemical and marine. Heat Exchange Group Services Limited provides repair and maintenance services in three main fields; the rail industry, plate heat exchangers largely in the food and drink sector; and industrial services across a wide range of facilities including manufacturing, waste energy and hospitals.
Page 1
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
In the year to 30 June 2023 the Group showed strong growth in revenue, of 11%, delivering turnover of £19.2m. The group has two trading subsidiaries, Heat Exchange Group Services Limited and Greens Power limited. Heat Exchange Group Services Limited continued to trade profitably during the year, but Greens Power Limited was impacted by an onerous installation contract.
Like many businesses, the group’s costs were also impacted by the significant and sustained increase in energy prices, as well as general inflationary pressure in the market, notably payroll costs. Greens Power Limited generated an operating loss of £817k (2022: profit £46k), which was due to both the inflationary pressures seen across the economy, but also due to an onerous contract. This project was more complex than first envisaged, as well as there being a number of specific issues on the customer’s site, significantly increasing the time taken and manpower required to complete the installation. This project has now been completed and all costs accounted for in the 2022/23 financial year. In the first half of 2023/24 the business returned to profitability, generating an operating profit of £67k in the six months to December 2023. Heat Exchange Group Services Limited activity levels continue to increase, with sales increasing by 17%, as the business strengthened relationships with existing customers, which includes a number of large blue chip organisations, as well as developed its activities in the district heating sector. This resulted in sales growth of 17%, to £5.1m, generating an operating profit of £16k. Order intake across the group was at its highest levels post-pandemic, with a significant order book having been built up at June 2023, equivalent to over eight months revenue at 2022/23 levels. The group also continues to have significant international reach, with 40% of projects by revenue delivered outside the UK in 2022/23 across the group, with a high level of work from its existing customers, underlining the businesses reputation for quality. Despite the trading loss in Greens Power Limited the group retained a strong cash position at 30 June 2023 was strong, with cash and cash equivalents of £585k, with the business continuing to retain the support of its investors and funding partners. Post year end, in the first half of the 2022/23 financial year, the group is trading well as the significant order book built up at the end of the 2022/23 financial year is delivered. The business is also benefiting from a review of its underlying cost base, and plans have already been implemented to reduce this by £0.5m, which has contributed to the improvement in trading performance and margins. Projects undertaken in the year ended 30 June 2023 included those delivered in Australasia, North and South America, Europe and the UK, and the order book continues to include projects in multiple jurisdictions which helps insulate the business from shocks in any one market. Therefore, despite the uncertain economic outlook, the business has returned to profitability in the 2023/24 financial year and given the good visibility over revenue from a strong order book, active market sectors in which the business operates and, more stable input prices, is expected to remain profitable throughout the 2023/24 financial year.
Page 2
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
The management of the business and the execution of the company’s strategy are subject to a number of risks. The key business risks affecting the core activities of the business are set out below. Risks are reviewed by the board and appropriate processes put in place to monitor and mitigate them.
1) Brexit - Impact on the ease and customers’ willingness to source from the UK, or impacting the cost of materials. 2) Raw materials prices - The impact of the Covid 19 pandemic and also other factors on raw materials input prices, as well as global supply chains. 3) Foreign exchange - Significant foreign exchange movements in the Euro or US Dollar. Hedging is used to mitigate this risk when appropriate.
Our key performance indicators are
• On time delivery - All key contracts have been delivered on time with the exception of a few Covid related delays due to the strained global supply chains, which were successfully managed with our customers. • Quality - Our weld repair ratio remained at exceptional levels at under x %. • Safety first - Accident rate per man hour is trending downwards year on year and near misses tracked below target levels. • Financial performance - achieve operating and net profitability. The trading businesses in the group returned to profitability during the year, despite the external challenges of the Covid 19 pandemic.
The focus for the next financial year is on maintaining its strong relationships with key customers to help maintain and grow revenue, whilst delivering the existing order book. There will also continue to be a focus on costs, to help maintain cost reductions and improvements in margin seen in the first half of the 2023/24 financial year.
This will ensure that the business continues to trade profitability, strengthening its cash position. The Directors do not anticipate any significant changes in products or key markets in the immediate future.
This report was approved by the board and signed on its behalf.
Page 3
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 JUNE 2023
The directors present their report and the financial statements for the period ended 30 June 2023.
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.
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 loss for the period, after taxation, amounted to £1,325,243 (2022 - loss £374,836).
The directors who served during the period were:
The future developments of the group have been covered in the strategic report.
Information is not shown in the directors’ report because it is shown in the strategic report instead under S414C(11). The strategic report includes a business review, principal risks and uncertainties and financial key performance indicators.
Page 4
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
There have been no significant events affecting the Group since the year end.
Under section 487(2) of the Companies Act 2006, Armstrong Watson Audit Limited will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
Page 5
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HEAT EXCHANGE GROUP LIMITED
We have audited the financial statements of Heat Exchange Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 30 June 2023, which comprise the Group Statement of comprehensive income, the Group and Company Statements of financial position, 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).
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 Auditors' 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.
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 Group's or the parent 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.
Page 6
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HEAT EXCHANGE GROUP LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
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 period 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.
Page 7
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HEAT EXCHANGE 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 Auditors' 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 Group 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:
• The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations, such as the Health & Safety at Work Act 1974 and Companies Act 2006; • We identified the laws and regulations applicable to the company through discussions with directors and other management; • We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and • Identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the Company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: • Making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and • Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: • Performed analytical procedures as a risk assessment tool to identify any unusual or unexpected relationships; and • Tested journal entries to identify unusual transactions; and • Reviewed the operating effectiveness of certain controls over purchase cycles on a sample basis. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: • Agreeing financial statement disclosures to underlying supporting documentation; and • Enquiring of management as to actual and potential litigation and claims. Due 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, 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 fraud or non-compliance with laws and regulations and cannot be expected to detect all fraud and non-compliance with laws.
Page 8
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HEAT EXCHANGE GROUP LIMITED (CONTINUED)
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 Auditors' 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 Auditors' 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
Statutory Auditor
Northallerton
Page 9
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2023
Page 10
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
REGISTERED NUMBER: 06428860
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 35 form part of these financial statements.
Page 11
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
REGISTERED NUMBER: 06428860
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 35 form part of these financial statements.
Page 12
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2023
Page 13
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2023
Page 14
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 15
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE PERIOD ENDED 30 JUNE 2023
Page 16
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
The company is a private company limited by shares, incorporated and domiciled in the United Kingdom. It's registered address is at 5th Floor, 24 Old Bond Street, Mayfair, London, W1S 4AW. The trading place of business is Raines Business Centre, Raines House, Denby Dale Road, Wakefield, West Yorkshire, WF1 1HR.
Heat Exchange Group Limited is the holding company to a trading group. The principle activity of the company is to handle the administrative affairs and services of a holding company and grants management services to its subsidiaries. It also provides financial support and control function for the board. Furthermore, the company is responsible for managing the group and its overall legal structure, tax planning, financial and equity structures. In addition, it is involved in matters of policy, strategic planning, marketing, selecting and manning senior management positions, approving investments and budgets, and the overall ongoing monitoring of the group companies' performance. These financial statements are presented in Pound Sterling as this is the currency of the primary economic environment in which the company operates.
2.Accounting policies
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 3).
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 Statement of financial position, 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 22 November 2019.
Page 17
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
2.Accounting policies (continued)
The directors have considered the on-going situation with regard to the energy cost crisis as part of their going concern assessment. The view of the directors is that, while they acknowledge the significant disruption that this will bring over the conning months, the directors feel that the company is well placed to negotiate the unique set of conditions currently facing the UK economy. The companys current level of cash is positive and the directors have taken strategic measures to safeguard the company.
In reaching their conclusion, the directors have considered cash flow forecasts that cover a period of at least 12 months from the date of sign off of the financial statements, applied sensitivity as appropriate and have taken advantage of the wider financial support available to the company from the wider Group. FCap One Limited, principal secured lender, has provided a formal letter of support indicating their continued financial support to Heat Exchange Group Limited for a period of at least 12 months from the date of sign off of the financial statements. After consideration of all factors, the directors continue to adopt the going concern basis in preparing the financial statements.
Functional and presentation currency
Transactions and balances
Page 18
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
2.Accounting policies (continued)
Temporary rent concessions occurring as a direct consequence of the COVID-19 pandemic have been recognised on a systematic basis over the periods that the change in lease payments is intended to compensate. This is conditional on: • The change in lease payments resulting in revised consideration for the lease that is less than the consideration for the lease immediately preceding the change; • Any reduction in lease payments affecting only payments originally due on or before 30 June 2022; • There being no significant change to other terms and conditions of the lease.
Page 19
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
2.Accounting policies (continued)
Grants of a revenue nature are recognised in the Consolidated statement of comprehensive income in the same period as the related expenditure.
Page 20
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
2.Accounting policies (continued)
Page 21
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
2.Accounting policies (continued)
Goodwill
Other intangible assets
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
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.
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.
Page 22
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
2.Accounting policies (continued)
Page 23
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Judgements and estimates are continually evaluated and are based on historical experiences and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The company makes estimates and assumptions concerning the future. The resulting accounts estimates will be, by definition, seldom equal to the related actual results. The directors consider the key accounting estimates to be the recognition of contract revenue based on stage of completion of the contract, the provision for trade debtors, impairment of intangible fixed assets, and provision for obsolete stock. The contract revenue and costs are recognised by reference to the degree of completion of each contract as measured by the proportion of total costs at the balance sheet date to the estimated total cost of the contract. When it is probable that the total contract cost will exceed total contract revenue, the expected loss is recognised immediately. Contract costs are recognised as expenses in the period in which they are occurred. The late delivery provision is calculated on a contract by contract basis. Any penalties which are likely to crystallise are provided for. Provisions for trade debtors are reviewed by the directors on an ongoing basis who use their specific industry knowledge and experience to ensure the correct judgements. Provisions for obsolete stock are reviewed by the directors on an ongoing basis who use their specific industry knowledge and experience to ensure the correct judgements.
Analysis of turnover by country of destination:
Page 24
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 25
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 26
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
11.Taxation (continued)
There were no factors that may affect future tax charges.
Page 27
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 28
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
12.Intangible assets (continued)
Page 29
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 30
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 31
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Page 32
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Net obligations under finance leases and hire purchase contracts are secured against the assets to which they relate.
Page 33
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
Capital redemption reserve
Profit and loss account
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 £175,790 (2022 - £198,622). Contributions totalling £35,687 (2022 - £28,918) were payable to the fund at the reporting date and are included in creditors.
Page 34
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
HEAT EXCHANGE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
No individual has ultimate control of the company.
Page 35
|