Company Registration No. SC129673 (Scotland)
Fifth Ring Limited
financial statements
for the year ended 31 March 2021
Pages for filing with Registrar
Fifth Ring Limited
Contents
Page
Balance sheet
1
Notes to the financial statements
2 - 9
Fifth Ring Limited
Balance sheet
as at 31 March 2021
- 1 -
2021
2020
Notes
£
£
£
£
Fixed assets
Tangible assets
4
6,473
17,196
Investments
5
710
710
7,183
17,906
Current assets
Debtors
7
1,070,107
1,422,194
Cash at bank and in hand
72,729
181,257
1,142,836
1,603,451
Creditors: amounts falling due within one year
8
(248,440)
(843,147)
Net current assets
894,396
760,304
Total assets less current liabilities
901,579
778,210
Creditors: amounts falling due after more than one year
9
(672,838)
(425,727)
Provisions for liabilities
-
Net assets
228,741
352,483
Capital and reserves
Called up share capital
10
50,000
50,000
Profit and loss reserves
11
178,741
302,483
Total equity
228,741
352,483
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.
true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 28 October 2021 and are signed on its behalf by:
I Ord
Director
Company Registration No. SC129673
Fifth Ring Limited
Notes to the financial statements
for the year ended 31 March 2021
- 2 -
1
Accounting policies
Company information
Fifth Ring Limited is a
private
company
limited by shares
incorporated in
Scotland
.
The registered office is
47 St Mary's Court, Huntly Street, Aberdeen, AB10 1TH.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies' regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section 400 of the
Companies Act 2006 not to prepare consolidated
financial statements
. The
financial statements
present information about the company as an individual entity and not about its group
.
Fifth Ring Limited is a subsidiary of D.C. Thomson & Company Limited and is controlled within that group. The results of Fifth Ring Limited are included in the consolidated financial statements of D.C. Thomson & Company Limited.
1.2
Going concern
The financial statements have been prepared on a going concern basis. The directors have considered relevant information, including the annual budget, forecast future cash flows and the impact of subsequent events in making their assessment. The directors have performed a robust analysis of forecast future cash flows taking into account the potential impact on the business of possible future scenarios arising from the impact of COVID-19. This analysis also considers the effectiveness of available measures to assist in mitigating the impact.
true
Based on these assessments and having regard to the resources available to the company, including the ongoing financial support of its parent company D.C. Thomson & Company Limited, the directors have concluded that there is no material uncertainty and that they can continue to adopt the going concern basis in preparing the annual report and financial statements.
1.3
Turnover
Turnover represents amounts receivable for services net of VAT and trade discounts.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that
it is probable will be
recover
ed
.
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
1
Accounting policies (continued)
- 3 -
1.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
15% straight line
Plant and machinery
25% - 33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
1.5
Fixed asset investments
Interests in subsidiaries
are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in
profit
or
loss
.
A subsidiary is an entity controlled by the company
. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
1.6
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the
company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand,
and
deposits held at call with banks
.
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
1
Accounting policies (continued)
- 4 -
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include
debtors
and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest
method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including
creditors
, bank loans, loans from
fellow group companies and preference shares that are classified as debt, are
initially recognised at transaction price unless the arrangement constitutes a
financing transaction, where the debt instrument is measured at the present value of
the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities.
Trade creditors
are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
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
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
1
Accounting policies (continued)
- 5 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the
profit and loss account
, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or
fixed assets
.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
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
s
asset are consumed.
1.14
Government grants
Government grants are recognised at the fair value of the asset receive
d
or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met
. Where a
grant does not specify performance conditions
it
is recognised in income when the proceeds are received or receivable
. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
- 6 -
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2021
2020
Number
Number
Total
29
35
3
Directors' remuneration
2021
2020
£
£
Remuneration paid to directors
255,594
270,505
4
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 April 2020
269,309
220,370
489,679
Additions
648
648
At 31 March 2021
269,309
221,018
490,327
Depreciation and impairment
At 1 April 2020
269,309
203,174
472,483
Depreciation charged in the year
11,371
11,371
At 31 March 2021
269,309
214,545
483,854
Carrying amount
At 31 March 2021
6,473
6,473
At 31 March 2020
17,196
17,196
5
Fixed asset investments
2021
2020
£
£
Shares in group undertakings and participating interests
710
710
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
- 7 -
6
Subsidiaries
These financial statements are separate company financial statements for Fifth Ring Limited.
Details of the company's subsidiaries at 31 March 2021 are as follows:
Country of
Class of
Name of undertaking
incorporation
Nature of business
shareholding
% Held
Fifth Ring Inc.
USA
Marketing, communications, branding and litigation support
Ordinary
100.00
7
Debtors
2021
2020
Amounts falling due within one year:
£
£
Trade debtors
241,874
337,404
Corporation tax recoverable
28,249
Amounts due from group undertakings
702,984
958,913
Other debtors
91,095
120,488
1,064,202
1,416,805
Deferred tax asset
5,905
5,389
1,070,107
1,422,194
Amounts due from group undertakings have no fixed repayment terms and no interest applies.
8
Creditors: amounts falling due within one year
2021
2020
£
£
Trade creditors
29,649
43,581
Amounts due to group undertakings
3,352
527,954
Corporation tax
16,233
Other taxation and social security
103,736
109,120
Other creditors
111,703
146,259
248,440
843,147
Amounts due to group undertakings have no fixed repayment terms and no interest applies.
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
- 8 -
9
Creditors: amounts falling due after more than one year
2021
2020
£
£
Other creditors
672,838
425,727
Other creditors represent intercompany loans which are unsecured. Interest applies at 2% above base rate per annum to part of the balance.
10
Called up share capital
2021
2020
£
£
Ordinary share capital
Issued and fully paid
50,000 Ordinary shares of £1 each
50,000
50,000
The company has one class of ordinary shares which are non-redeemable shares that carry the right to receive such dividends as the directors of the company may determine; attend and vote at general meetings; and to share in surplus assets on a winding up.
11
Profit and loss reserves
Profit and loss reserves include all current and prior period retained profits and losses.
12
Audit report information
As the income statement has been omitted from the filing copy of the financial statements
,
the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006
:
The auditor's report was unqualified.
The senior statutory auditor was Gavin Black.
The auditor was Henderson Loggie LLP.
13
Financial commitments, guarantees and contingent liabilities
A bond and floating charge is in place over the assets of the company.
14
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2021
2020
£
£
404,793
475,583
Fifth Ring Limited
Notes to the financial statements (continued)
for the year ended 31 March 2021
- 9 -
15
Parent company
The company is a wholly owned subsidiary of Clavamore Limited, a company incorporated in Great Britain and registered in Scotland.
Clavamore Limited is a 64% owned subsidiary undertaking of D.C. Thomson & Company Limited, a company incorporated in Great Britain and registered in Scotland.
There is no individual controlling party of D.C. Thomson & Company Limited.