The People Group Limited - Limited company accounts 20.1

REGISTERED NUMBER: 05121869 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2020

FOR

THE PEOPLE GROUP LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

4

Income Statement

6

Other Comprehensive Income

7

Balance Sheet

8

Statement of Changes in Equity

9

Notes to the Financial Statements

10

DIRECTORS:

K J McNeela

C Moffatt

S Rushton

REGISTERED OFFICE:

11th Floor

30 Crown Place

Hackney

London

EC2A 4EB

REGISTERED NUMBER:

05121869 (England and Wales)

AUDITORS:

Oury Clark Chartered Accountants

Statutory Auditors

Herschel House

58 Herschel Street

Slough

Berkshire

SL1 1PG

The directors present their strategic report for the year ended 31 March 2020.

REVIEW OF BUSINESS

The principal activity of the company is to provide recruitment consultancy services. The services include full executive search, contingency and contract recruitment across all geographies and disciplines.

During the accounting period, the company delivered services worth £60,591,206 (2019: £74,344,094).

The company has ongoing activities in 2020 and the directors do not consider that there is a going concern risk. The company has a profit before tax of £2,199,922 (2019: £119,812). The directors consider the results for the accounting period and the financial position at 31 March 2020 to be satisfactory. The directors believe that the company remains in a strong position in its sectors of the market.

PRINCIPAL RISKS AND UNCERTAINTIES

The company has established risk management and internal control process for the identification, assessment and management of strategic, operational, financial and compliance risks likely to affect the achievement of the company's corporate and strategic objectives.

The board has overall responsibility for the company's risk management process. Day to day management of risk is performed by the board who are accountable for the risk mitigation activities. The management process is subject to ongoing review, which aims to ensure the process is effective and promotes management ownership of risk.

The directors have assessed the possible impact of Covid-19 pandemic on the business after the year end and it is expected that this will have an impact on the business. In the short term, due to social distancing measures required to be in place to operate a safe construction site, the business may experience a downturn in business. The business will continue with the current strategy to grow the number of clients.

The board of directors sets out the financial risk policies that are implemented by the finance department. The Board considers that the financial risks do not pose a major threat to the company.

FINANCIAL AND NON-FINANCIAL KEY PERFORMANCE INDICATORS

Both income and profit before tax are measured as part of the company's key performance indicators in addition to average margin and the volume of new work orders.

In addition to the financial key performance indicators, Management and the Directors also monitor certain non-financial key performance indicators at the company level including employee satisfaction and retention.

The Directors are satisfied with the Company's performance.

ON BEHALF OF THE BOARD:

S Rushton - Director

29 March 2021

The directors present their report with the financial statements of the company for the year ended 31 March 2020.

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2020.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2019 to the date of this report.

K J McNeela

C Moffatt

S Rushton

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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 company and of the profit or loss of the company 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;

-	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 company's transactions and disclose with reasonable accuracy at any time the financial position of the 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 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 directors are 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 each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Oury Clark Chartered Accountants, are deemed to be re-appointed under Section 487 (2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:

S Rushton - Director

29 March 2021

Opinion

We have audited the financial statements of The People Group Limited (the 'company') for the year ended 31 March 2020 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity 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 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 31 March 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 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 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, 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 Directors 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 Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified any matters in the Report of the Directors or the Strategic Report that are inconsistent with our overall view of the financial statements.

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 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 Statement of Directors' Responsibilities set out on page three, 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 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 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 company or to cease operations, or have 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.

Ian Phipps (Senior Statutory Auditor)

for and on behalf of Oury Clark Chartered Accountants

Statutory Auditors

Herschel House

58 Herschel Street

Slough

Berkshire

SL1 1PG

30 March 2021

TURNOVER

3

60,593

74,342

Cost of sales

56,966

72,345

GROSS PROFIT

3,627

1,997

Administrative expenses

1,430

1,879

2,197

118

Other operating income

3

-

OPERATING PROFIT

5

2,200

118

Interest receivable and similar income

-

2

PROFIT BEFORE TAXATION

2,200

120

Tax on profit

6

425

119

PROFIT FOR THE FINANCIAL YEAR

1,775

1

PROFIT FOR THE YEAR

1,775

1

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,775

1

CURRENT ASSETS

Debtors

9

4,952

3,458

Cash at bank

3,291

1,563

8,243

5,021

CREDITORS

Amounts falling due within one year

10

5,814

4,367

NET CURRENT ASSETS

2,429

654

TOTAL ASSETS LESS CURRENT LIABILITIES

2,429

654

CAPITAL AND RESERVES

Called up share capital

12

1

1

Retained earnings

13

2,428

653

SHAREHOLDERS' FUNDS

2,429

654

The financial statements were approved by the Board of Directors and authorised for issue on 29 March 2021 and were signed on its behalf by:

S Rushton - Director

Called up

share

Retained

Total

capital

earnings

equity

£'000

£'000

£'000

Balance at 31 March 2019

1

852

853

Changes in equity

Dividends

-

(200

)

(200

)

Total comprehensive income

-

1

1

Balance at 31 March 2019

1

653

654

Changes in equity

Total comprehensive income

-

1,775

1,775

Balance at 31 March 2020

1

2,428

2,429

1.	STATUTORY INFORMATION

The People Group 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 prior 12 month period comparatives are not entirely comparable to the current 15 month period. The period was extended by three months so that the financial statements take into account a longer period with new ownership.

Going Concern

Having considered the financial position of the company and the support available from the parent company the directors have continued to adopt the going concern basis in preparing these financial statements. The directors consider that the outbreak of Covid-19 will not significantly affect the entity’s ability to continue as a going concern.

Financial Reporting Standard 102 - reduced disclosure exemptions

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.

Preparation of consolidated financial statements

The financial statements contain information about The People Group Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 400 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertaking are included by full consolidation in the consolidated financial statements of its parent, People Group Holdings Limited, 30 Crown Place, 11th Floor, London, England, EC2A 4EB.

The subsidiary of The People Group Limited is Engage Selection Limited, and has a registered office of 30 Crown Place, 11th Floor, London, England, EC2A 4EB. This company was dissolved on 6th October 2020.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Significant judgements and estimates

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Turnover

Turnover represents services sold on a mark-up basis according to a pre agreed contractual rate. Turnover is recognised as work is completed and is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Government grants

Government grants relating to the Coronavirus Jobs Retention Scheme (CJRS) are recognised on an accruals basis.

Financial instruments

Financial assets and financial liabilities are recognised in the Company’s balance sheet when the Company becomes a party to the contractual provisions of the relevant instrument, and derecognised when it ceases to be a party to such provisions.

Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through the statement of total comprehensive income are recognised immediately in profit or loss.

Financial assets

The Company classifies its financial assets into the categories, discussed below, due to the purpose for which the asset was acquired. The Company has not classified any of its financial assets as held to maturity.

Loans and receivables

These assets are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise principally through the provision of services to customers (e.g. trade debtors), but also incorporate other types of contractual monetary asset. They are initially recognised at fair value, including transaction costs that are directly attributable to their acquisition or issue, and are subsequently carried at amortised cost.

The Company’s loans and receivables consist of trade and other debtors and prepayments included within the balance sheet. Cash and bank balances include cash held at bank and cash on hand.

Impairment provisions are recognised when there is objective evidence, for example, significant financial difficulties on the part of the counterparty, or default, or significant delay in payment, that the Company will be unable to collect all of the amounts due under the terms of the receivable. The amount of such a provision being the difference between the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable.

For certain categories of financial asset, such as trade debtors, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables includes the Company’s past experience of collecting payments.

For trade debtors which are reported net, such provisions are recorded in a separate allowance account with the loss being recognised within administrative expenses in the statement of total comprehensive income. On confirmation that the trade receivables will not be collectable, the gross carrying value of the asset is written off against the associated provision. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss.

Financial liabilities and equity

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Ordinary shares are classified as equity; ordinary shares issued by the Company are recognised at the proceeds received, net of direct issue costs.

Financial liabilities

Borrowings are initially recognised at fair value net of any directly attributable transaction costs. These interest-bearing liabilities are subsequently measured at amortised cost using the effective interest method, with the interest expense charged at a constant rate on the outstanding liabilities.

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.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

3.

TURNOVER

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

4.	EMPLOYEES AND DIRECTORS

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£'000

£'000

Wages and salaries

1,044

2,371

Social security costs

110

197

Other pension costs

37

56

1,191

2,624

The average number of employees during the year was as follows:

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

Administration

7

6

Consultants

4

5

Directors

3

3

14

14

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£

£

Directors' remuneration

554,668

418,260

Information regarding the highest paid director is as follows:

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£

£

Emoluments etc

204,218

219,927

5.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£'000

£'000

Other operating leases

119

36

Auditors' remuneration

15

15

Foreign exchange differences

(5

)

34

6.

TAXATION

Analysis of the tax charge

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

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£'000

£'000

Current tax:

UK corporation tax

425

119

Tax on profit

425

119

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:

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£'000

£'000

Profit before tax

2,200

120

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

418

23

Effects of:

Expenses not deductible for tax purposes

8

1

Income not taxable for tax purposes

-

99

Capital allowances in excess of depreciation

(1

)

(1

)

Utilisation of tax losses

-

(3

)

Group relief claimed

(47

)

(41

)

Payment for group relief

47

41

Total tax charge

425

119

7.

DIVIDENDS

Period

31.3.19

Year Ended

to

31.3.20

31.3.19

£'000

£'000

Ordinary shares of £1 each

Interim

-

200

8.	GOVERNMENT GRANTS

Government grants in the year relate entirely to the Coronavirus Jobs Retention Scheme (CJRS). Total amounts claimed under the scheme in the year were £3,313 (2019: £nil). As at the year end, there are no unfulfilled conditions in relation to this grant.

9.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.3.20

31.3.19

£'000

£'000

Trade debtors

3,798

2,491

Amounts owed by group undertakings

1,017

312

Other debtors

83

70

Prepayments and accrued income

54

585

4,952

3,458

10.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.3.20

31.3.19

£'000

£'000

Trade creditors

3,515

2,687

Tax

410

95

Social security and other taxes

29

37

VAT

468

816

Other creditors

271

146

Accruals and deferred income

1,121

586

5,814

4,367

11.	LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

31.3.20

31.3.19

£'000

£'000

Within one year

230

80

Between one and five years

173

-

403

80

12.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

31.3.20

31.3.19

value:

£

£

950

Ordinary

£1

950

950

Ordinary shares carry full and equal rights to participate in all circumstances and in dividends and capital distributions, whether on a winding up or otherwise. The shares are not redeemable.

13.

RESERVES

Retained

earnings

£'000

At 1 April 2019

653

Profit for the year

1,775

At 31 March 2020

2,428

14.	PENSION COMMITMENTS

During the year, the company made pension contributions of £34,671 (2019: £36,661). As at the year end there were pensions unpaid of £6,913 (2019: £1,942).

15.	ULTIMATE PARENT COMPANY

People Group Holdings Limited is regarded by the directors as being the company's ultimate parent company.

The immediate and ultimate parent company is People Group Holdings Limited, a company incorporated at 30 Crown place, 11th Floor, London, England, EC2A 4EB. People Group Holdings Ltd is the largest group company to prepare consolidated financial statements.

16.	ULTIMATE CONTROLLING PARTY

The controlling party is S Rushton.

17.

CHARGES

Mace Limited holds a floating charge over all present and future book and other debts and monetary claims due or owing to The People Group Limited.