Company Registration No. 10939801 (England and Wales)
IUKH GNT LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
IUKH GNT LIMITED
COMPANY INFORMATION
Directors
A Gregory
D Nolan
P Tyler
L Johnson
Company number
10939801
Registered office
The New Oakes
Wellington Street
Oakes
Huddersfield
West Yorkshire
HD3 3EP
Auditor
UHY Hacker Young Manchester LLP
St James Building
79 Oxford Street
Manchester
M1 6HT
Bankers
National Westminister Bank Plc
8 Market Place
Huddersfield
HD1 2AL
Solicitors
Chadwick Lawrence LLP
13 Railway Street
Huddersfield
HD1 1JS
IUKH GNT LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 28
IUKH GNT LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2019
The directors present the strategic report for the year ended 31 July 2019.
Fair review of the business
The company is a holding company with three subsidiaries. Interiors UK Limited is the main trading subsidiary. IUKH Limited and Interiors UK Holdings Limited are both former holding companies for the group and are both now dormant.
The business has performed well as a whole, and we are delighted to continue to give a high level of service to our clients.
The following results are representative of the trading subsidiary in comparing the 12 months to 31 July 2018 to the 12 months to 31 July 2019.
Market conditions in the financial year have been steady and we have managed to broaden our client base with less reliance on larger customers. This has resulted in an increased turnover of £3.7m, and gross margin increase of £599k.
We have also managed to increase gross margin from 7.5% to 8.7%. Overheads have remained fairly consistent apart from a large bad debt provision.
Net profit before tax margin has also increased by £161k.
The only significant risk to the business in the foreseeable future is the effect of Covid-19. The business has more than enough cash reserves to carry on trading with the same overheads, and although we have suffered a downturn in business, we have adapted quickly enough to carry on trading profitably.
There are only a handful of customers who will cease trading, and we have downsized the business to cope with this.
We expect the 2020 year to be profitable.
P Tyler
Director
30 July 2020
- 1 -
IUKH GNT LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2019
The directors present their annual report and financial statements for the year ended 31 July 2019.
Principal activities
The principal activity of the company is that of a holding company.
The principal activity of the group relates to that of its subsidiary company, Interiors UK Limited, which is that of specialist leisure contractors.
IUKH Limited and Interiors Holdings Limited, the company's other subsidiaries, do not trade.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
A Gregory
D Nolan
P Tyler
L Johnson
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £19,074. The directors do not recommend payment of a final dividend.
Financial instruments
The company has a normal level of exposure to price, credit, liquidity and cash flow risks arising from its trading
activities which are only conducted in sterling. The company does not enter into any hedging transactions.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor
of the
company is
unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor
of the
company
is
aware of that information.
Going concern
At the time of approving the financial statements the directors have assessed the impact of the Covid-19 pandemic and although there has been a significant reduction in trade in recent months and a small number of customers have ceased trading, the group has adapted quickly in order to continue trading profitably and has scaled back operations in line with the reduced workload.
The directors acknowledge the continued disruption to trade that the pandemic is likely to bring over the coming months but feel that the group is well placed to further adapt to these conditions are they arise.
The directors have considered the cashflows of the group covering a period of 12 months from the date of sign off and the availability of further external funding and government assistance, if required. A key assumption used in preparing these cash flows is that the business will continue to trade during this time, but activity will be significantly reduced and collection of cash will be slowed down as payment plans have been agreed with key customers.
Therefore the directors continue to adopt the going concern basis in preparing the financial statements.
- 2 -
IUKH GNT LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
On behalf of the board
P Tyler
Director
30 July 2020
- 3 -
IUKH GNT LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JULY 2019
The directors are responsible for preparing the Annual Report and the 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 group and company, 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 and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
- 4 -
IUKH GNT LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF IUKH GNT LIMITED
Opinion
We have audited the
financial statements of IUKH GNT Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2019 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, 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 FRS 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:
-
give a true and fair view of the state of the group's and the parent company's affairs as at 31 July 2019 and of the group's profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’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.
Conclusions relating to going concern
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 required to report that fact.
We have nothing to report in this regard.
- 5 -
IUKH GNT LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IUKH GNT LIMITED
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the strategic report and the directors' r
eport for the financial year for which the financial statements are prepared is consistent with the financial statements
; and
-
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
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 identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
-
the parent company financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, 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.
Auditor's responsibilities for the audit of the financial statements
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: http://www.frc.org.uk/auditorsresponsibilities
.
This description forms part of our auditor’s report.
- 6 -
IUKH GNT LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IUKH GNT LIMITED
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.
David Symonds FCA (Senior Statutory Auditor)
for and on behalf of UHY Hacker Young Manchester LLP
30 July 2020
Chartered Accountants
Statutory Auditor
St James Building
79 Oxford Street
Manchester
M1 6HT
- 7 -
IUKH GNT LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JULY 2019
Year
Period
ended
ended
31 July
31 July
2019
2018
Notes
£
£
Turnover
3
28,156,230
21,068,582
Cost of sales
(25,712,943)
(19,389,033)
Gross profit
2,443,287
1,679,549
Administrative expenses
(1,032,392)
(492,706)
Operating profit
4
1,410,895
1,186,843
Interest receivable and similar income
8
246
145
Interest payable and similar expenses
9
(80,349)
(59,076)
Profit before taxation
1,330,792
1,127,912
Tax on profit
10
(263,842)
(227,576)
Profit for the financial year
24
1,066,950
900,336
Profit for the financial year is all attributable to the owners of the parent company.
- 8 -
IUKH GNT LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JULY 2019
Year
Period
ended
ended
31 July
31 July
2019
2018
£
£
Profit for the year
1,066,950
900,336
Other comprehensive income
-
-
Total comprehensive income for the year
1,066,950
900,336
Total comprehensive income for the year is all attributable to the owners of the parent company.
- 9 -
IUKH GNT LIMITED
GROUP BALANCE SHEET
AS AT 31 JULY 2019
31 July 2019
2019
2018
Notes
£
£
£
£
Fixed assets
Goodwill
12
218,091
265,478
Tangible assets
13
247,404
257,946
465,495
523,424
Current assets
Stocks
17
200,785
125,163
Debtors
18
6,255,114
5,086,509
Cash at bank and in hand
1,396,598
1,216,959
7,852,497
6,428,631
Creditors: amounts falling due within one year
19
(6,369,680)
(6,051,619)
Net current assets
1,482,817
377,012
Total assets less current liabilities
1,948,312
900,436
Capital and reserves
Called up share capital
23
100
100
Profit and loss reserves
24
1,948,212
900,336
Total equity
1,948,312
900,436
The financial statements were approved by the board of directors and authorised for issue on 30 July 2020 and are signed on its behalf by:
30 July 2020
P Tyler
Director
- 10 -
IUKH GNT LIMITED
COMPANY BALANCE SHEET
AS AT 31 JULY 2019
31 July 2019
2019
2018
Notes
£
£
£
£
Fixed assets
Investments
14
4,630,743
4,630,743
Current assets
Debtors
18
100
100
Creditors: amounts falling due within one year
19
(3,475,766)
(4,626,497)
Net current liabilities
(3,475,666)
(4,626,397)
Total assets less current liabilities
1,155,077
4,346
Capital and reserves
Called up share capital
23
100
100
Profit and loss reserves
24
1,154,977
4,246
Total equity
1,155,077
4,346
As permitted by s408 Companies Act 2006, the
c
ompany has not presented its own profit and loss account and related notes. The
c
ompany’s profit for the year was £1,169,805 (2018 - £4,246 profit).
The financial statements were approved by the board of directors and authorised for issue on 30 July 2020 and are signed on its behalf by:
30 July 2020
P Tyler
Director
Company Registration No. 10939801
- 11 -
IUKH GNT LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2019
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 31 August 2017
-
-
-
Period ended 31 July 2018:
Profit and total comprehensive income for the period
-
900,336
900,336
Issue of share capital
23
100
-
100
Balance at 31 July 2018
100
900,336
900,436
Period ended 31 July 2019:
Profit and total comprehensive income for the period
-
1,066,950
1,066,950
Dividends
11
-
(19,074)
(19,074)
Balance at 31 July 2019
100
1,948,212
1,948,312
- 12 -
IUKH GNT LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2019
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 31 August 2017
-
-
-
Period ended 31 July 2018:
Profit and total comprehensive income for the period
-
4,246
4,246
Issue of share capital
23
100
-
100
Balance at 31 July 2018
100
4,246
4,346
Period ended 31 July 2019:
Profit and total comprehensive income for the period
-
1,169,805
1,169,805
Dividends
11
-
(19,074)
(19,074)
Balance at 31 July 2019
100
1,154,977
1,155,077
- 13 -
IUKH GNT LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2019
2019
2018
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
1,923,212
79,208
Interest paid
(61,916)
(31,500)
Income taxes paid
(306,324)
(215,001)
Net cash inflow/(outflow) from operating activities
1,554,972
(167,293)
Investing activities
Purchase of business
-
2,026,464
Purchase of tangible fixed assets
(128,703)
(193,717)
Proceeds on disposal of tangible fixed assets
41,198
51,260
Interest received
246
145
Net cash (used in)/generated from investing activities
(87,259)
1,884,152
Financing activities
Proceeds from issue of shares
-
100
Issue of loans
(19,000)
-
Repayment of borrowings
(1,250,000)
(500,000)
Dividends paid to equity shareholders
(19,074)
-
Net cash used in financing activities
(1,288,074)
(499,900)
Net increase in cash and cash equivalents
179,639
1,216,959
Cash and cash equivalents at beginning of year
1,216,959
-
Cash and cash equivalents at end of year
1,396,598
1,216,959
- 14 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2019
1
Accounting policies
Company information
IUKH GNT Limited
(“the company”)
is a
private
limited company domiciled and incorporated in England and Wales.
The registered office is
The New Oakes, Wellington Street, Oakes, Huddersfield, West Yorkshire, HD3 3EP.
The group consists of IUKH GNT Limited and all of its subsidiaries.
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.
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.
1.2
Basis of consolidation
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date.
Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date.
I
nvestments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
The consolidated financial statements incorporate those of IUKH GNT Limited and all of its subsidiaries (ie entities that the
g
roup controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 31 July 2019
.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the
g
roup.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
- 15 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
1
Accounting policies
(Continued)
1.3
Going concern
At the time of approving the financial statements the directors have assessed the impact of the Covid-19 pandemic and although there has been a significant reduction in trade in recent months and a small number of customers have ceased trading, the group has adapted quickly in order to continue trading profitably and has scaled back operations in line with the reduced workload.
The directors acknowledge the continued disruption to trade that the pandemic is likely to bring over the coming months but feel that the group is well placed to further adapt to these conditions are they arise.
The directors have considered the cashflows of the group covering a period of 12 months from the date of sign off and the availability of further external funding and government assistance, if required. A key assumption used in preparing these cash flows is that the business will continue to trade during this time, but activity will be significantly reduced and collection of cash will be slowed down as payment plans have been agreed with key customers.
Therefore the directors continue to adopt the going concern basis in preparing the financial statements.
1.4
Reporting period
The financial statements have been presented over a period of 12 months. The prior period covered 14 months from commencement of trading of the holding company. The amounts presented in the financial statements are therefore not entirely comparable.
1.5
Turnover
Turnover
represents the value of goods sold and services provided net of value added tax and in the case of incomplete contracts, the fair value of work undertaken during the period compared with the total value of the contract. Revenues are recognised when there are no significant obligations remaining by the vendor and collection of the resulting receivables is considered probable.
1.6
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of
a
business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated
amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
1.7
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:
Fixtures, fittings and equipment
25 - 33.33% straight line
Motor vehicles
25% 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 recognised in the profit and loss account.
- 16 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
1
Accounting policies
(Continued)
1.8
Fixed asset investments
Equity in
vest
ments are measured at fair value through profit or loss
,
except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably
,
which are recognised at cost less impairment until a reliable measure of fair value becomes available.
I
n the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the
group. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
1.9
Impairment of fixed assets
At each reporting
period
end date, the
group
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.
1.10
Stocks
- 17 -
Stocks
and work in progress
are stated at the lower of cost and estimated selling price less costs to complete and sell.
Work in progress represents initial costs incurred on contracts not started at the year end.
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.
1.11
Cash at bank and in hand
Cash and cash equivalents
are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.12
Financial instruments
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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
m
ethod 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.
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
1
Accounting policies
(Continued)
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
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.
1.13
Equity instruments
Equity instruments issued by the group 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 group.
1.14
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
group’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.
A net deferred tax asset is regarded as recoverable and therefore recognised only to the extent that, on the basis of all available evidence, it can be regarded as more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
1.15
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.
1.16
Retirement benefits
The group operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to the profit and loss account in the year they are payable.
1.17
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
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
d
asset are consumed.
- 18 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
1
Accounting policies
(Continued)
1.18
Amounts recoverable on contracts
Amounts recoverable on contracts, which are included in debtors, are stated at the net sales value of the work done after provision for contingencies and anticipated future losses on contracts, less amounts received as progress payments on account. Excess progress payments are included in creditors, within accruals.
2
Judgements and key sources of estimation uncertainty
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
There were no key judgements.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Estimates and provisions
Included within income, expenditure, debtors and creditors are estimated costs and revenues relating to
contracts
which were on going at the
period
end. The amounts brought in are to bring the
contract
costs and revenues
in line with their stage of completion at the
period
end date, based on their expected margin upon completion
of the
contract
.
At the period end the following amounts had been estimated based on these assumptions:
Accrued income £2,063,530 (2018 - £1,225,895), deferred income £541,533 (£125,078) and accrued expenditure £1,303,376 (£937,068).
In addition to this there is a further estimation of revenues brought in to account for retentions due from customer. These are estimated as 2.5% of the total contract value.
At the period end, amounts due to customers had been estimated at £349,266 (2018 - £285,607).
3
Turnover and other revenue
2019
2018
£
£
Turnover analysed by class of business
Goods and services provided
28,156,230
21,068,582
2019
2018
£
£
Other significant revenue
Interest income
-
145
- 19 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
3
Turnover and other revenue
(Continued)
2019
2018
£
£
Turnover analysed by geographical market
United Kingdom
28,140,903
21,048,761
France
-
5,652
Spain
-
7,135
Germany
15,327
7,034
28,156,230
21,068,582
4
Operating profit
2019
2018
£
£
Operating profit for the period is stated after charging/(crediting):
Depreciation of owned tangible fixed assets
97,455
98,107
Loss/(profit) on disposal of tangible fixed assets
592
(31,606)
Amortisation of intangible assets
47,387
41,464
Operating lease charges
43,588
40,919
5
Auditor's remuneration
2019
2018
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
4,000
4,000
Audit of the financial statements of the company's subsidiaries
13,500
13,000
17,500
17,000
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2019
2018
2019
2018
Number
Number
Number
Number
Weekly
45
48
-
-
Monthly
35
33
4
4
80
81
4
4
- 20 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
6
Employees
(Continued)
Their aggregate remuneration comprised:
Group
Company
2019
2018
2019
2018
£
£
£
£
Wages and salaries
4,694,791
3,796,436
-
-
Social security costs
443,643
430,247
-
-
Pension costs
153,748
111,651
-
-
5,292,182
4,338,334
-
-
7
Directors' remuneration
2019
2018
£
£
Remuneration for qualifying services
442,085
333,767
Company pension contributions to defined contribution schemes
38,754
35,944
480,839
369,711
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2018 - 3).
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2019
2018
£
£
Remuneration for qualifying services
209,756
144,626
Company pension contributions to defined contribution schemes
13,232
10,728
8
Interest receivable and similar income
2019
2018
£
£
Interest income
Interest on bank deposits
246
145
- 21 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
9
Interest payable and similar expenses
2019
2018
£
£
Interest on bank overdrafts and loans
154
-
Other interest on financial liabilities
80,195
58,479
Other interest
-
597
Total finance costs
80,349
59,076
10
Taxation
2019
2018
£
£
Current tax
UK corporation tax on profits for the current period
216,373
225,711
Group tax relief
15,237
-
Total current tax
231,610
225,711
Deferred tax
Origination and reversal of timing differences
32,232
1,865
Total tax charge
263,842
227,576
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2019
2018
£
£
Profit before taxation
1,330,792
1,127,912
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2018: 19.00%)
252,850
214,303
Tax effect of expenses that are not deductible in determining taxable profit
14,416
10,435
Unutilised tax losses carried forward
-
11,111
Group relief
(15,237)
-
Other adjustments
11,813
(8,273)
Taxation charge
263,842
227,576
11
Dividends
2019
2018
£
£
Interim paid
19,074
-
- 22 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
12
Intangible fixed assets
Group
Goodwill
£
Cost
At 31 August 2018
473,877
At 31 July 2019
473,877
Amortisation and impairment
At 1 August 2018
208,399
Amortisation charged for the year
47,387
At 31 July 2019
255,786
Carrying amount
At 31 July 2019
218,091
At 31 July 2018
265,478
The company had no intangible fixed assets at 31 July 2019 or 31 July 2018.
13
Tangible fixed assets
Group
Fixtures, fittings and equipment
Motor vehicles
Total
£
£
£
Cost
At 1 August 2018
111,274
442,784
554,058
Additions
2,687
126,016
128,703
Disposals
-
(172,452)
(172,452)
At 31 July 2019
113,961
396,348
510,309
Depreciation and impairment
At 1 August 2018
98,859
197,253
296,112
Depreciation charged in the year
11,777
85,678
97,455
Eliminated in respect of disposals
-
(130,662)
(130,662)
At 31 July 2019
110,636
152,269
262,905
Carrying amount
At 31 July 2019
3,325
244,079
247,404
At 31 July 2018
12,415
245,531
257,946
The company had no tangible fixed assets at 31 July 2019 or 31 July 2018.
- 23 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
14
Fixed asset investments
Group
Company
2019
2018
2019
2018
Notes
£
£
£
£
Investments in subsidiaries
15
-
-
4,630,743
4,630,743
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 August 2018 and 31 July 2019
4,630,743
Carrying amount
At 31 July 2019
4,630,743
At 31 July 2018
4,630,743
15
Subsidiaries
Details of the company's subsidiaries at 31 July 2019 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Interiors UK Holdings Limited
(1)
Dormant company
Ordinary
100.00
Interiors UK Limited
(1)
Specialist leisure contractors
Ordinary
100.00
IUKH Limited
(1)
Dormant company
Ordinary
100.00
(1) The registered office is
The New Oakes, Wellington Street, Oakes, Huddersfield, West Yorkshire, HD3 3EP
.
16
Financial instruments
Group
Company
2019
2018
2019
2018
£
£
£
£
Carrying amount of financial liabilities
Measured at amortised cost
750,000
2,000,000
n/a
n/a
As permitted by the reduced disclosure framework within FRS 102, the company has taken advantage of the exemption from disclosing the carrying amount of certain classes of financial instruments
,
denoted by
'
n/a
'
above
.
- 24 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
17
Stocks
Group
Company
2019
2018
2019
2018
£
£
£
£
Raw materials and consumables
-
19,210
-
-
Work in progress
200,785
105,953
-
-
200,785
125,163
-
-
18
Debtors
Group
Company
2019
2018
2019
2018
Amounts falling due within one year:
£
£
£
£
Trade debtors
4,112,245
3,749,292
-
-
Other debtors
19,200
200
100
100
Prepayments and accrued income
2,080,912
1,262,028
-
-
6,212,357
5,011,520
100
100
Amounts falling due after more than one year:
Deferred tax asset (note 21)
42,757
74,989
-
-
Total debtors
6,255,114
5,086,509
100
100
19
Creditors: amounts falling due within one year
Group
Company
2019
2018
2019
2018
Notes
£
£
£
£
Other borrowings
20
750,000
2,000,000
750,000
2,000,000
Trade creditors
2,831,591
2,032,911
-
-
Amounts owed to group undertakings
-
-
2,679,757
2,598,921
Corporation tax payable
4,471
79,185
-
-
Other taxation and social security
542,278
591,023
-
-
Other creditors
50,065
41,867
46,009
27,576
Accruals and deferred income
2,191,275
1,306,633
-
-
6,369,680
6,051,619
3,475,766
4,626,497
- 25 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
20
Loans and overdrafts
Group
Company
2019
2018
2019
2018
£
£
£
£
Other loans
750,000
2,000,000
750,000
2,000,000
Payable within one year
750,000
2,000,000
750,000
2,000,000
Other
loans are
non qualifying corporate bond fixed rate unsecured loan notes. The
loan notes
are repayable on demand and
attract interest of 3
.75
%
.
21
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Assets
Assets
2019
2018
Group
£
£
Accelerated capital allowances
41,947
40,219
Other timing differences
810
34,770
42,757
74,989
The company has no deferred tax assets or liabilities.
Group
Company
2019
2019
Movements in the year:
£
£
Liability/(asset) at 1 August 2018
(74,989)
-
Charge to profit or loss
32,232
-
Liability/(asset) at 31 July 2019
(42,757)
-
22
Retirement benefit schemes
2019
2018
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
153,748
111,651
- 26 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
22
Retirement benefit schemes
(Continued)
A
defined contribution pension scheme
is operated
for all qualifying employees.
The assets of the scheme are held separately from those of the group in an independently administered fund.
23
Share capital
Group and company
2019
2018
Ordinary share capital
£
£
Issued and fully paid
30 Ordinary A shares of £1 each
30
30
30 Ordinary B shares of £1 each
30
30
30 Ordinary C shares of £1 each
30
30
10 Ordinary D shares of £1 each
10
10
100
100
Each share is entitled to one vote
in any circumstances
.
Each share is entitled pari passu to dividend payments or any other distribution. Each share is entitled pari passu to participate in a distribution arising from a winding up of the company. The shares are non-redeemable.
24
Reserves
Profit and loss reserves
The profit and loss
reserves
include all current and prior period retained profits and losses, net of dividends paid
.
25
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2019
2018
2019
2018
£
£
£
£
Within one year
38,130
39,278
-
-
Between two and five years
102,000
19,005
-
-
140,130
58,283
-
-
- 27 -
IUKH GNT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2019
26
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2019
2018
£
£
Aggregate compensation
392,441
416,898
27
Cash generated from group operations
2019
2018
£
£
Profit for the year after tax
1,066,950
900,336
Adjustments for:
Taxation charged
263,842
227,576
Finance costs
80,349
59,076
Investment income
(246)
(145)
Loss/(gain) on disposal of tangible fixed assets
592
(31,606)
Amortisation and impairment of intangible assets
47,387
41,464
Depreciation and impairment of tangible fixed assets
97,455
98,107
Movements in working capital:
Decrease in stocks
75,622
73,747
(Increase)/decrease in debtors
(1,201,687)
1,627,112
Increase/(decrease) in creditors
1,492,948
(2,363,838)
Cash generated from operations
1,923,212
631,829
- 28 -
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