Company registration number 03492137 (England and Wales)
PULSE INSURANCE LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022
PAGES FOR FILING WITH REGISTRAR
PULSE INSURANCE LIMITED
CONTENTS
Page
Accountants' report
1
Balance sheet
2 - 3
Notes to the financial statements
4 - 11
PULSE INSURANCE LIMITED
ACCOUNTANTS' REPORT TO THE BOARD OF DIRECTORS ON THE PREPARATION OF THE UNAUDITED STATUTORY FINANCIAL STATEMENTS OF PULSE INSURANCE LIMITED FOR THE PERIOD ENDED 31 DECEMBER 2022
- 1 -
In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of Pulse Insurance Limited for the Period ended 31 December 2022 which comprise, the balance sheet and the related notes from the company’s accounting records and from information and explanations you have given us.
As a practising member firm of the Institute of Chartered Accountants in England and Wales (ICAEW), we are subject to its ethical and other professional requirements which are detailed at https://www.icaew.com/regulation.
This report is made solely to the Board of Directors of Pulse Insurance Limited, as a body, in accordance with the terms of our engagement letter. Our work has been undertaken solely to prepare for your approval the financial statements of Pulse Insurance Limited and state those matters that we have agreed to state to the Board of Directors of Pulse Insurance Limited, as a body, in this report in accordance with ICAEW Technical Release 07/16 AAF. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Pulse Insurance Limited and its Board of Directors as a body, for our work or for this report.
It is your duty to ensure that Pulse Insurance Limited has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and profit of Pulse Insurance Limited. You consider that Pulse Insurance Limited is exempt from the statutory audit requirement for the Period.
We have not been instructed to carry out an audit or a review of the financial statements of Pulse Insurance Limited. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements.
Ellacotts LLP
Chartered Accountants
Countrywide House
23 West Bar
Banbury
Oxfordshire
England
OX16 9SA
Date:
26 September 2023
PULSE INSURANCE LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2022
31 December 2022
- 2 -
2022
2021
Notes
£
£
£
£
Fixed assets
Intangible assets
6
290,134
187,991
Tangible assets
3
11,034
12,485
Investments
5
16,292
16,292
317,460
216,768
Current assets
Debtors falling due after more than one year
7
1,313,200
1,225,429
Debtors falling due within one year
7
751,938
508,439
Cash at bank and in hand
9,802
5,092
2,074,940
1,738,960
Creditors: amounts falling due within one year
8
(436,855)
(208,770)
Net current assets
1,638,085
1,530,190
Total assets less current liabilities
1,955,545
1,746,958
Creditors: amounts falling due after more than one year
9
(537,974)
(567,620)
Provisions for liabilities
11
(603,408)
(606,072)
Net assets
814,163
573,266
Capital and reserves
Called up share capital
10
165,532
165,532
Share premium account
108,730
108,730
Profit and loss reserves
539,901
299,004
Total equity
814,163
573,266
PULSE INSURANCE LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
31 December 2022
- 3 -
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
For the financial Period ended 31 December 2022 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The members have not required the company to obtain an audit of its financial statements for the Period in question in accordance with section 476.
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 21 September 2023 and are signed on its behalf by:
T McLusky
Director
Company Registration No. 03492137
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 4 -
1
Accounting policies
Company information
Pulse Insurance Limited is a private company limited by shares incorporated in England and Wales. The registered office is 6 Oxford Court, St James Road, Brackley, Northamptonshire, NN13 7XY.
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 amounts in these financial statements are rounded to the nearest £.
1.2
Turnover
Turnover represents commissions and fees for the arrangement of insurance and fees for consultancy services.
Credit is taken for brokerage, commission and fees on inception of the policy.
On certain lines of insurance business, a provision is made for cancellations which is unwound over the life of the insurance policy.
1.3
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses 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 considered to be 10 years.
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation 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:
Software development
20% on cost
Customer contracts
10 years straight line
1.5
Tangible fixed assets
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 5 -
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:
Office equipment
25% on cost
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.
1.6
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities 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.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.7
Cash at bank and in hand
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
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.
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 6 -
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 payments 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. Amounts 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
Taxation
The tax expense represents the sum of the tax currently payable.
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.
1.10
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation. Provisions are also based on an estimate of the likelihood of cancellation of policies during their policy term.
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 in 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.
1.11
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 leases asset are consumed.
1.12
Government grants
Government grants are recognised at the fair value of the asset received 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.
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 7 -
1.13
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.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Total
26
24
3
Tangible fixed assets
Office equipment
£
Cost
At 1 January 2022
88,767
Additions
5,418
At 31 December 2022
94,185
Depreciation and impairment
At 1 January 2022
76,282
Depreciation charged in the Period
6,869
At 31 December 2022
83,151
Carrying amount
At 31 December 2022
11,034
At 31 December 2021
12,485
4
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
80,772
38,776
Adjustments in respect of prior periods
2,588
Total current tax
83,360
38,776
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 8 -
5
Fixed asset investments
2022
2021
£
£
Shares in group undertakings and participating interests
16,292
16,292
6
Intangible fixed assets
Goodwill
Software Development
Customer contracts
Total
£
£
£
£
Cost
At 1 January 2018
41,352
68,291
205,595
315,238
Additions
146,352
-
-
146,352
At 31 December 2022
187,704
68,291
205,595
461,590
Amortisation and impairment
At 1 January 2022
10,338
68,291
48,618
127,247
Amortisation charged for the Period
23,649
20,560
44,209
At 31 December 2022
33,987
68,291
69,178
171,456
Carrying amount
At 31 December 2022
153,717
136,417
290,134
At 31 December 2021
31,014
156,977
187,991
7
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
397,731
244,728
Other debtors
354,207
263,711
751,938
508,439
2022
2021
Amounts falling due after more than one year:
£
£
Trade debtors
1,313,200
1,225,429
Total debtors
2,065,138
1,733,868
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 9 -
8
Creditors: amounts falling due within one year
2022
2021
£
£
Bank loans
38,533
29,683
Trade creditors
86,997
87,198
Corporation tax
122,136
38,776
Other taxation and social security
24,051
21,554
Other creditors
165,138
31,559
436,855
208,770
One of the bank loans is secured by a limited guarantee given by 3 directors of the company.
9
Creditors: amounts falling due after more than one year
2022
2021
£
£
Bank loans
177,572
220,100
Other creditors
360,402
347,520
537,974
567,620
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 10 -
10
Called up share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 25p each
662,127
662,127
165,532
165,532
11
Provisions for liabilities
2022
2021
£
£
Provision for commission clawback
603,408
606,072
Many of the policies the Company arranges are long term. On long-term business, commission is paid to the Company on both an indemnity and non-indemnity basis. If the policy is cancelled early future annual commission would not be paid and any indemnity commission would have to be repaid, In the case of indemnity commission the Company has established a provision for this commission clawback. This provision is based on an estimate of the likelihood of cancellation of policies during the first four years of the policy term (clawback is not usually payable after four years). The estimate considers the risk of cancellation as a result of either a housing market crash or the risk of cancellation as a result of changes to relevant rules due to political intervention. The provision is established on inception of the policy and unwound on a straight line basis over the first four years of the policy terms.
Where commission is paid annually for the duration of the policy, the provision is based on an estimate of the likelihood of cancellation of policies during the full policy term. The estimate considers the risk of cancellation as a result of either a housing market crash or the risk of cancellation as a result of changes to relevant rules due to political intervention. The provision is established on inception of the policy and unwound on a straight line basis over the life of the policy. There is a high level of uncertainty around this annual commission provision given that the events that could trigger payments are unpredictable. The appropriateness of the assumptions in this provision are reconsidered annually by the board.
In addition to the usual provision for commission clawback and / or early cancellation of long-term policies, the Board considers the ongoing impact of the Covid Pandemic to be such, that a further exceptional provision for commission clawback and / or early cancellation needs to be made. The Board concluded that an uplift in the usual provision was therefore appropriate for 2021 and this uplift remains in place in 2022. The Board intends to unwind this exceptional provision as quickly as possible and to revert to a normal provisioning with effect from 2023.
Movements on provisions:
Provision for commission clawback
£
At 1 January 2022
498,629
Exceptional "Covid Provision" for commission clawback/early cancellation
107,444
Credited to profit and loss account
(2,665)
At 31 December 2022
603,408
PULSE INSURANCE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2022
- 11 -
12
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases of £17,302 (December 2021: £44,405).
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