Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2021
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
COMPANY INFORMATION
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
CONTENTS
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
The directors present their strategic report for the year ended 31 December 2021.
Significant growth in 2021 has been driven by demand for Systal's class leading portfolio of managed and
transformation services. This organic trend will continue in 2022, underpinned by extended commitments from Systal long term customer relationships and new global service success stories together with Systal US and Systal APAC. Key growth highlights include turnover increase of 32%. Gross Profit has increased to £16.1m and underlying Net Profit after tax of £7.56m. Systal continues its investment strategy to support controlled growth through people development, expanded secure operating centre facilities and new technologies.
The main risks and uncertainties affecting the company continue to be competition within the IT industry, shortages of skilled staff and settlement of accounts.
The directors have concluded that analysis using key performance indicators to gain an understanding of the
development, performance or position of the company's business is not required due to the detail given in the financial statements.
The company's financial instruments comprise cash at bank, invoice discounting facility, bank loans and hire purchase facilities. The main purpose of these instruments is to raise adequate finance for the company's operations.
The main risks arising from the company's financial instruments are interest rate fluctuations and liquidity risk. It is the company's policy to finance its operations through a mixture of cash and borrowing and to review periodically the mixture of these instruments with regard to the projected cash flow requirements of the company at an acceptable level of exposure.
Share capital
The share capital is owned by Systal Holdings Limited. See note 20 for further details regarding the ultimate parent company information.
Future developments
The company is continuing to develop its worldwide customer base. The company continues to look for further development opportunities.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
This report was approved by the board
and signed on its behalf.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2021
The Directors shown below have held office during the whole of the period 1 January 2021 to the date of the report:
There have been no significant events affecting the Company since the year end.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2021
The auditors, Anderson Anderson & Brown Audit LLP, will be proposed for reappointment in accordance with
section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYSTAL TECHNOLOGY SOLUTIONS LIMITED
We have audited the financial statements of Systal Technology Solutions Limited (the 'Company') for the year ended 31 December 2021, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of changes in equity
and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards,
including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In 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 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.
We have nothing to report in this regard.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYSTAL TECHNOLOGY SOLUTIONS LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙
the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙
the 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 Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the Directors' report.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYSTAL TECHNOLOGY SOLUTIONS 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 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:
- completing a risk-assessment process during our planning for this audit that specifically considered the risk of
fraud; - enquiry of management about the company's policies, procedures and related controls regarding compliance with laws and regulations and if there are any known instances of non-compliance; - examining supporting documents for all material balances, transactions and disclosures; - enquiry of management, about litigations and claims and inspection of relevant correspondence - evaluation of the selection and application of accounting policies related to subjective measurements and complex transactions; - analytical procedures to identify any unusual or unexpected relationships; - specific audit testing on and review of areas that could be subject to management override of controls and potential bias, most notably around the key judgments and estimates, including the amounts recoverable on contracts, deprecation of fixed assets, carrying value of accruals and revenue recognition; - considering management override of controls outside of the normal operating cycles including testing the appropriateness of journal entries recorded in the general ledger and other adjustments made in the preparation of the financial statements including evaluating the business rationale of significant transactions, outside the normal course of business. We design our procedures so as to obtain sufficient appropriate audit evidence that the financial statements are not materially misstated due to non-compliance with laws and regulations or due to fraud or error. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations - this responsibility lies with management with the oversight of the directors. Based on our understanding of the company and industry, discussions with management and directors we identified financial reporting standards and Companies Act 2006 as having a direct effect on the amounts and disclosures in the financial statements. As part of the engagement team discussion about how and where the company's financial statements may be materially misstated due to fraud, we did not identify any areas with an increased risk of fraud. Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements of the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). The potential effects of inherent limitations are particularly significant in the case of misstatement resulting from fraud because fraud may involve sophisticated and carefully organized schemes designed to conceal it, including deliberate failure to record transactions, collusion or intentional misrepresentations being made to us.
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.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SYSTAL TECHNOLOGY SOLUTIONS LIMITED (CONTINUED)
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
Citypoint 2
25 Tyndrum Street
G4 0JY
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
REGISTERED NUMBER:
SC345442
BALANCE SHEET
AS AT
31 DECEMBER 2021
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 12 to 25 form part of these financial statements.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 DECEMBER 2021
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Systal Technology Solutions Limited is a private company, limited by shares, registered in Scotland. The
company's registered number is SC345442 and its registered office is Rowan House, 1 Robroyston Oval, Nova Business Park, Glasgow, G33 1AP. The principal activity of the company is the provision of IT goods and services. The financial statements are presented in Sterling, which is also the functional currency of the company.
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 management to exercise judgement in applying the Company's accounting policies.
The following principal accounting policies have been applied:
The company is in a strong financial position. Having considered budgets and cash flows, monthly management accounts and available working capital to include considerations for COVID-19, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors continue to believe the going concern basis of accounting appropriate in preparing the financial statements. The key source of estimation uncertainty that has a significant effect on the amounts recognised in the financial statements is the value of the amounts recoverable on contracts.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
The company has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
• the requirements of Section 7 Statement of Cash Flows. As the company is included in the consolidated financial statements of Sarah Topco Limited, it is entitled to take advantage of various disclosure exemptions within FRS 102. As a result, the company has elected not to prepare a cash flow statement.
The company has taken advantage of exemption, under Section 33 of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with other group companies.
Turnover for the sale of goods is recognised when the company has transferred to the buyer the risks and rewards of ownership. Turnover for the provision of services is recognised when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and the stage of completion can be measured reliably.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
Functional and presentation currency
Transactions and balances
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
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.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
Rentals payable under hire purchase contracts are charged against the resultant creditor with any interest element being charged against income as the charges arise.
Finance leases are capitalised at commencement of the lease as assets at the fair value of the leased asset or, if lower, the present value of the minimum lease payments calculated using the interest rate implicit in the lease. Where the implicit rate cannot be determined the company’s incremental borrowing rate is used. Incremental direct costs, incurred in negotiating and arranging the lease, are included in the cost of the asset. Assets are depreciated over the shorter of the lease term and the estimated useful life of the asset. Assets are assessed for impairment at each reporting date. The capital element of lease obligations is recorded as a liability on inception of the arrangement. Lease payments are apportioned between capital repayment and finance charge, using the effective interest rate method, to produce a constant rate of charge on the balance of the capital repayments outstanding.
Amounts recoverable on contracts results when the risks and rewards of ownership have passed for the provision of IT goods and services. For projects spanning the year end, amounts recoverable on contract arises based on the percentage of completion on the project.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Balance sheet.
Loans are measured initially at fair value, net of transactions costs, and are measured subsequently at amortised cost using the effective interest method.
Analysis of turnover by country of destination:
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
The Directors consider themselves as the key management personnel of the company so no further disclosure required.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
10.
Taxation (continued)
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Minimum lease payments under hire purchase and finance leases fall due as follows:
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Hire purchase contracts are secured against the assets which the liability relates.
Finance leases are secured against the assets which the liability relates. The Clydesdale Bank PLC held a floating charge over the assets of the company.
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
19.
Deferred taxation (continued)
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SYSTAL TECHNOLOGY SOLUTIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
The balance on the Director loan accounts are £nil (2020: Director 1 £33,698, Director 2 £73,504 and Director 3 £28,877 and all were owed to each Director respectfully) and they have been fully re-paid during the year.
The company manages capital by regularly monitoring its current and expected liquidity requirements rather than using debt/equity ratio analyses. No changes were made in the objectives, policies and processes during the year. The company is not subject to either internally or externally imposed capital requirements. Copies of the consolidated financial statements of Systal Holdings Limited are available to the public from its registered office at Rowan House 1, Robroyston Oval, Glasgow, G33 1AP. From the 2 March 2021, the ultimate parent company of Systal Technology Solutions Limited is Sarah Topco Limited, a company incorporated in Great Britain and registered in England and Wales.
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