Bright Sky Umbrella Limited - Limited company accounts 20.1

REGISTERED NUMBER: 09531678 (England and Wales)

Bright Sky Umbrella Limited

Strategic Report, Report of the Director and

Financial Statements

for the Year Ended 30 April 2020

Page

Company Information

1

Strategic Report

2

Report of the Director

3

Report of the Independent Auditors

4

Income Statement

6

Other Comprehensive Income

7

Balance Sheet

8

Statement of Changes in Equity

9

Cash Flow Statement

10

Notes to the Cash Flow Statement

11

Notes to the Financial Statements

12

DIRECTOR:

Mr A J Connell

REGISTERED OFFICE:

Hanover House

Liverpool

L1 3DZ

REGISTERED NUMBER:

09531678 (England and Wales)

AUDITORS:

Salisbury & Company Business Solutions Limited

Statutory Auditors

Chartered Accountants

Irish Square

Upper Denbigh Road

St Asaph

Denbighshire

LL17 0RN

The director presents the strategic report for the year ended 30 April 2019.

FAIR REVIEW OF THE BUSINESS

The results for the year are set out on page 6. Turnover has decreased by £9,668,816 compared to the prior year to £12,670,408. This was due to a reduction in the number of people registered with the company as employees or contractors. The gross profit for the year is £373,291 which was as a result the reduction of clients in the year due to a reduced service offering. Administrative expenses have decreased by £160,695 compared to the prior year to £385,085. The major cause of this was streamlining our services and removing any unnecessary costs. There are audit fees of £10,000 this year. Insurance costs decreased by £15,643 to £19,590. This was mainly due to the fact the company no longer required all previous levels of insurance due to the more streamlined service offering. Wages and salaries administration costs decreased by £25,451 to £116,368 due to the average number of admin staff reducing. The net profit after tax is £22,982. In the prior year there was a net profit after tax of £52,994.

PRINCIPAL RISKS AND UNCERTAINTIES

The company faces a number of business risks and uncertainties due to the challenging trading conditions and competition. In view of this, the director and management team are always looking carefully at both existing and potential new markets. The management team is charged with the responsibility for increasing turnover but working within the level of costs incurred.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The company uses various financial instruments including loans, cash and various items, such as trade debtors and trade creditors that arise directly from its operations. The existence of these financial instruments exposes the company to a number of financial risks, which are described in more detail below.

The main risks arising from the company's financial instruments are market risk, liquidity risk, interest rate risk, cash flow and credit risk. The directors review and agree policies for managing each of these risks and they are summarised below.

Market risk

Market risk encompasses three types of risk being currency risk, interest rate risk and price risk. The company's policies for managing interest rate risk are considered along with those for managing cash flow risk and are set out in the subsection entitled "interest rate risk" below.

Liquidity risk

The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably.

Interest Rate risk

The company finances its operations through a mixture of retained profits and bank borrowings. The company's exposure to interest rate fluctuations is negligible given its surplus of cash.

Credit risk

The company's principal financial assets are trade debtors. The principal credit risk arises from its trade debtors, which are carefully monitored by the company.

KEY PERFORMANCE INDICATORS

The company's key performance indicators are gross profit and operating profit. As already detailed, gross profit has decreased from the prior year due to the changes in service offerings. Operating profit is £29,083 compared to an operating profit of £63,157 in the prior year.

Other information and explanations

The company has good cash reserves of £205,460. All sales are to UK customers and all suppliers are UK based.

ON BEHALF OF THE BOARD:

Mr A J Connell - Director

14 December 2020

The director presents his report with the financial statements of the company for the year ended 30 April 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of payroll and consultancy services.

DIVIDENDS

No dividends will be distributed for the year ended 30 April 2020.

DIRECTOR

Mr A J Connell held office during the whole of the period from 1 May 2019 to the date of this report.

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the director is required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Salisbury & Company Business Solutions Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr A J Connell - Director

14 December 2020

Opinion

We have audited the financial statements of Bright Sky Umbrella Limited (the 'company') for the year ended 30 April 2020 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 Financial Reporting Standard 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 company's affairs as at 30 April 2020 and of its 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.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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 director's use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the director has not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the 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.

Other information

The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors 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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Director 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Director.

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, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of director's remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page three, the director is 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 director determines 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 director is responsible for assessing the 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors 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 www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors 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.

Jeremy Salisbury (Senior Statutory Auditor)

for and on behalf of Salisbury & Company Business Solutions Limited

Statutory Auditors

Chartered Accountants

Irish Square

Upper Denbigh Road

St Asaph

Denbighshire

LL17 0RN

14 December 2020

TURNOVER

3

12,670,408

22,339,224

Cost of sales

(12,297,117

)

(21,730,197

)

GROSS PROFIT

373,291

609,027

Administrative expenses

(385,085

)

(545,870

)

(11,794

)

63,157

Other operating income

40,877

-

OPERATING PROFIT

5

29,083

63,157

Interest receivable and similar income

6

163

136

PROFIT BEFORE TAXATION

29,246

63,293

Tax on profit

7

(6,264

)

(10,299

)

PROFIT FOR THE FINANCIAL YEAR

22,982

52,994

PROFIT FOR THE YEAR

22,982

52,994

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

22,982

52,994

FIXED ASSETS

Tangible assets

8

1,043

1,011

Investments

9

1

1

1,044

1,012

CURRENT ASSETS

Debtors

10

501,621

736,696

Cash at bank

205,487

467,227

707,108

1,203,923

CREDITORS

Amounts falling due within one year

11

628,223

963,186

NET CURRENT ASSETS

78,885

240,737

TOTAL ASSETS LESS CURRENT LIABILITIES

79,929

241,749

CREDITORS

Amounts falling due after more than one year

12

(40,000

)

(225,000

)

PROVISIONS FOR LIABILITIES

15

(198

)

-

NET ASSETS

39,731

16,749

CAPITAL AND RESERVES

Called up share capital

16

1

1

Retained earnings

17

39,730

16,748

SHAREHOLDERS' FUNDS

39,731

16,749

The financial statements were approved by the director and authorised for issue on 14 December 2020 and were signed by:

Mr A J Connell - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 May 2018

1

(36,246

)

(36,245

)

Changes in equity

Total comprehensive income

-

52,994

52,994

Balance at 30 April 2019

1

16,748

16,749

Changes in equity

Total comprehensive income

-

22,982

22,982

Balance at 30 April 2020

1

39,730

39,731

Cash flows from operating activities

Cash generated from operations

1

(78,758

)

(584,956

)

Tax paid

(10,299

)

(56,318

)

Net cash from operating activities

(89,057

)

(641,274

)

Cash flows from investing activities

Purchase of tangible fixed assets

(200

)

-

Interest received

163

136

Net cash from investing activities

(37

)

136

Cash flows from financing activities

New loans in year

-

225,000

Loan repayments in year

(185,000

)

-

Inter company loans

(28,800

)

-

Amount introduced by directors

-

170,329

Grants received

41,127

-

Net cash from financing activities

(172,673

)

395,329

Decrease in cash and cash equivalents

(261,767

)

(245,809

)

Cash and cash equivalents at beginning of year

2

467,227

713,036

Cash and cash equivalents at end of year

2

205,460

467,227

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2020

2019

£

£

Profit before taxation

29,246

63,293

Depreciation charges

168

752

Government grants

(41,127

)

-

Finance income

(163

)

(136

)

(11,876

)

63,909

Decrease in trade and other debtors

263,875

1,205,389

Decrease in trade and other creditors

(330,757

)

(1,854,254

)

Cash generated from operations

(78,758

)

(584,956

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 30 April 2020

30/4/20

1/5/19

£

£

Cash and cash equivalents

205,487

467,227

Bank overdrafts

(27

)

-

205,460

467,227

Year ended 30 April 2019

30/4/19

1/5/18

£

£

Cash and cash equivalents

467,227

713,036

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1/5/19

Cash flow

At 30/4/20

£

£

£

Net cash

Cash at bank

467,227

(261,740

)

205,487

Bank overdrafts

-

(27

)

(27

)

467,227

(261,767

)

205,460

Debt

Debts falling due after 1 year

(225,000

)

185,000

(40,000

)

(225,000

)

185,000

(40,000

)

Total

242,227

(76,767

)

165,460

1.	STATUTORY INFORMATION

Bright Sky Umbrella Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

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 £.

Going Concern

Within the financial year the World Health Organisation (WHO) declared Covid-19 as a worldwide pandemic. In relation to this the directors have reviewed the company's performance throughout the period and subsequent to the year end and, as a result believe that the preparation of the financial statements on the going concern basis is appropriate

Turnover

Turnover is measured at the fair value of the consideration received or receivable for services provided, excluding discounts, rebates, value added tax and other sales taxes.

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 & equipment 10% reducing balance method

Computer equipment Straight line over 3 years

Investments in subsidiaries

Investments in subsidiary undertakings are recognised at cost.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing commitments

Rentals payable under operating leases, including any lease incentives received, are charged to income 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 asset are consumed.

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.

Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Cash at bank and in hand

Cash at bank and in hand 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.

Judgements and key sources of estimation uncertainty

In the application of the company's accounting policies, the director is 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.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by class of business is given below:

2020

2019

£

£

Services provided

12,670,408

22,339,224

12,670,408

22,339,224

4.	EMPLOYEES AND DIRECTORS

The average monthly number of persons employed by the company during the year was:

2020

2019

Direct employees

230

251

Administration staff

7

6

Total

237

257

2020

2019

£

£

Director's remuneration

50,000

11,000

5.	OPERATING PROFIT

The operating profit is stated after charging:

2020

2019

£

£

Other operating leases

14,217

17,720

Depreciation - owned assets

168

752

Auditors' remuneration

10,000

11,810

Fees payable to the company's auditors for tax services

1,000

2,900

6.

INTEREST RECEIVABLE AND SIMILAR INCOME

2020

2019

£

£

Deposit account interest

163

136

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2020

2019

£

£

Current tax:

UK corporation tax

6,066

10,299

Deferred tax

198

-

Tax on profit

6,264

10,299

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2020

2019

£

£

Profit before tax

29,246

63,293

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2019 - 19%)

5,557

12,026

Effects of:

Expenses not deductible for tax purposes

515

724

Capital allowances in excess of depreciation

(6

)

-

Depreciation in excess of capital allowances

-

143

Utilisation of tax losses

-

(2,594

)

Deferred tax

198

-

Total tax charge

6,264

10,299

8.	TANGIBLE FIXED ASSETS

Fixtures

and

Computer

fittings

equipment

Totals

£

£

£

COST

At 1 May 2019

1,482

5,666

7,148

Additions

-

200

200

At 30 April 2020

1,482

5,866

7,348

DEPRECIATION

At 1 May 2019

471

5,666

6,137

Charge for year

101

67

168

At 30 April 2020

572

5,733

6,305

NET BOOK VALUE

At 30 April 2020

910

133

1,043

At 30 April 2019

1,011

-

1,011

9.	FIXED ASSET INVESTMENTS

Shares in

group

undertakings

£

COST

At 1 May 2019

and 30 April 2020

1

NET BOOK VALUE

At 30 April 2020

1

At 30 April 2019

1

10.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Trade debtors

246,182

415,800

Amounts owed by group undertakings

28,800

-

Other debtors

38,754

84,101

Directors' current accounts

2,959

2,959

Accrued income

183,121

228,413

Prepayments

1,805

5,423

501,621

736,696

11.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Bank loans and overdrafts (see note 13)

27

-

Trade creditors

11,138

5,737

Tax

6,066

10,299

Social security and other taxes

89,372

185,556

VAT

474,669

494,298

Other creditors

16,519

22,775

Accruals and deferred income

30,432

244,521

628,223

963,186