ACCOUNTS - Final Accounts preparation

As restated

SCOMAC SERVICES LTD - Company Information

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Registered number: 03554289

SCOMAC SERVICES LTD

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

SCOMAC SERVICES LTD

COMPANY INFORMATION

Directors	D O McCloskey
	D Scott
	T Higham (appointed 24 November 2022)
	C Townsend (appointed 15 May 2023)


Company secretary	B J McSean


Registered number	03554289


Registered office	247 High Street
	Aldershot
	Hampshire
	GU12 4NG


Independent auditor	Shaw Gibbs (Audit) Limited
	Wey Court West
	Union Road
	Farnham
	Surrey
	GU9 7PT


Accountants	Shaw Gibbs Limited
	Wey Court West
	Union Road
	Farnham
	Surrey
	GU9 7PT

SCOMAC SERVICES LTD

CONTENTS

	Page
Strategic report	1 - 2
Directors' report	3 - 4
Independent auditor's report	5 - 8
Profit and loss account	9
Statement of comprehensive income	10
Statement of financial position	11
Statement of changes in equity	12 - 13
Statement of cash flows	14 - 15
Analysis of net debt	16
Notes to the financial statements	17 - 34

SCOMAC SERVICES LTD

STRATEGIC REPORT

FOR THE YEAR ENDED 30 APRIL 2023

Introduction

The results for the year and financial position of the company are shown in the attached financial statements. The Directors are satisfied with the results for the year in which, compared with last year, the gross profits and operating profits increased, despite a decrease in the turnover.

Business review

Scomac Services Ltd has continued to operate as a building services engineering company within the United Kingdom. The company has a good client base which results in repeat business throughout the financial year.

The principal activity of Scomac Services Limited continues to be fit out and refurbishment projects within the high-end residential market and TV/film studios.

Contract Work:
These projects are generally within the high-end residential market as well as the fit-out of TV and film studio space. The contract size will vary from £100,000 to in excess of £20,000,000.
Small Works:
These projects vary in size from £5,000 to £100,000.
Maintenance:
The company provides bespoke maintenance programmes for properties within the high-end residential market, as well as film and TV studios, art galleries, leisure centres, social housing, retail and restaurants, as well the education sector.
A significant event for the company was the action of the shareholders David Scott and David McCloskey, to transfer the ownership of the company to The Scomac Services Limited Employee Ownership Trust, and the deal was signed on 28 April 2023.

Principal risks and uncertainties

Whilst working in the construction industry has always been challenging, the effects of rising inflation, increases in labour costs and the lasting effects following the global pandemic on the availability of materials continued to have an impact on the business. However, the company has continued to trade successfully throughout this period. Cash flow has been identified as a risk to the business, but there are sufficient reserves within the business for this to be managed.

Financial key performance indicators

Although the Company’s turnover for the year to 30 April 2023 was lower than the previous year, £36,158,363 compared with £57,142,154, the profit margins were improved.
Key Performance Indicators for the year are as follows:
Profitability ratio Gross Profit % 31% (2022 - 23%)
Operating Profit % 23% (2022 - 19%)
The company continued to benefit from recurring contract revenues with our key clients.

Other key performance indicators

The company has no other key performance indicators.

Page 1

SCOMAC SERVICES LTD

STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 30 APRIL 2023

This report was approved by the board on 16 April 2024 and signed on its behalf.

D O McCloskey

Director

Page 2

SCOMAC SERVICES LTD

DIRECTORS' REPORT

FOR THE YEAR ENDED 30 APRIL 2023

The directors present their report and the financial statements for the year ended 30 April 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic report, the Directors' report 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

∙make judgments 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 to 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.

Results and dividends

The profit for the year, after taxation, amounted to £6,699,859 (2022 - £8,328,409).

No dividends have been paid and none are recommended.

Directors

The directors who served during the year were:

D O McCloskey

D Scott

T Higham (appointed 24 November 2022)

Future developments

There are no material future developments to disclose in these financial statements.

Page 3

SCOMAC SERVICES LTD

DIRECTORS' REPORT (CONTINUED)

FOR THE YEAR ENDED 30 APRIL 2023

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:

∙so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware, and

∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

This report was approved by the board and signed on its behalf.

D O McCloskey

Director

Date: 16 April 2024

Page 4

SCOMAC SERVICES LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SCOMAC SERVICES LTD

Opinion

We have audited the financial statements of Scomac Services Ltd (the 'Company') for the year ended 30 April 2023, which comprise the Profit and loss account, the Statement of comprehensive income, the Statement of financial position, the Statement of cash flows, 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 our opinion the financial statements:

∙give a true and fair view of the state of the Company's affairs as at 30 April 2023 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 Auditor's 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 United Kingdom, including the Financial Reporting Council'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

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.

Page 5

SCOMAC SERVICES LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SCOMAC SERVICES LTD (CONTINUED)

Other information

The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's report thereon. The directors are responsible for the other information contained within the Annual Report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.

Opinion 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 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.

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 Directors' report.

We have nothing to report in respect of the following matters in relation to which 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 Directors' responsibilities statement set out on page 3, 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 is 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.

Page 6

SCOMAC SERVICES LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SCOMAC SERVICES LTD (CONTINUED)

Auditor's 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 an Auditor's 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:

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
We focussed on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to , the Companies Act 2006 and UK tax legislation.
Our tests included agreeing the financial statement disclosures to underlying supporting documentation, enquiries with management and enquiries of legal counsel . There are inherent limitations in the audit procedures described above and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

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 Auditor's report.

Other matters

The comparative figures presented in these financial statements are not audited.

Page 7

SCOMAC SERVICES LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SCOMAC SERVICES LTD (CONTINUED)

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 an Auditor's 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.

Keely Harvey BSc (Hons) FCA (Senior statutory auditor)

for and on behalf of

Shaw Gibbs (Audit) Limited

Wey Court West

Union Road

Farnham

Surrey

GU9 7PT

17 April 2024

Page 8

SCOMAC SERVICES LTD

PROFIT AND LOSS ACCOUNT

FOR THE YEAR ENDED 30 APRIL 2023

		As restated
	2023	2022
Note	£	£


Turnover	4	36,158,363	57,142,154
Cost of sales		(25,051,554)	(43,771,494)
Gross profit		11,106,809	13,370,660
Administrative expenses		(2,835,152)	(2,569,321)
Other operating income		949	1,919
Fair value movements		(10,000)	-
Operating profit		8,262,606	10,803,258
Interest receivable and similar income	8	38,031	804
Interest payable and similar expenses	9	(5,576)	(5,601)
Profit before tax		8,295,061	10,798,461
Tax on profit	10	(1,595,202)	(2,470,052)
Profit for the financial year		6,699,859	8,328,409

The notes on pages 17 to 34 form part of these financial statements.

Page 9

SCOMAC SERVICES LTD

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 30 APRIL 2023

		As restated
	2023	2022
Note	£	£

Profit for the financial year	6,699,859	8,328,409
Other comprehensive income
Unrealised (deficit)/surplus on revaluation of tangible fixed assets	(45,715)	-
Capital distribution	(8,345,100)	-
Other comprehensive income for the year	(8,390,815)	-
Total comprehensive income for the year	(1,690,956)	8,328,409

The notes on pages 17 to 34 form part of these financial statements.

Page 10

SCOMAC SERVICES LTD

REGISTERED NUMBER: 03554289

STATEMENT OF FINANCIAL POSITION

AS AT 30 APRIL 2023

		As restated
	2023	2022
Note	£	£

Fixed assets
Tangible assets	11		606,567		654,488
Investment property	12		145,000		155,000
			751,567		809,488
Current assets
Stocks	13	12,955		10,000
Debtors: amounts falling due within one year	14	8,175,525		9,117,289
Cash at bank and in hand	15	8,760,324		10,426,625
		16,948,804		19,553,914
Creditors: amounts falling due within one year	16	(8,725,864)		(9,660,923)
Net current assets			8,222,940		9,892,991
Total assets less current liabilities			8,974,507		10,702,479
Creditors: amounts falling due after more than one year	17		(47,400)		(56,318)
Provisions for liabilities
Deferred tax	19		(48,520)		(76,618)
Net assets			8,878,587		10,569,543

Capital and reserves
Called up share capital		1,000	1,000
Revaluation reserve	20	99,285	145,000
Investment property reserve	20	63,730	73,730
Profit and loss account	20	8,714,572	10,349,813
		8,878,587	10,569,543

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 16 April 2024.

D O McCloskey

Director

The notes on pages 17 to 34 form part of these financial statements.

Page 11

SCOMAC SERVICES LTD

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 APRIL 2023

	Called up share capital	Revaluation reserve	Investment property revaluation reserve	Profit and loss account	Total equity
	£	£	£	£	£
At 1 May 2022 (as previously stated)	1,000	145,000	73,730	10,091,961	10,311,691
Prior year adjustment - correction of error	-	-	-	257,852	257,852
At 1 May 2022 (as restated)	1,000	145,000	73,730	10,349,813	10,569,543
Comprehensive income for the year
Profit for the year	-	-	-	6,699,859	6,699,859
Deficit on revaluation of freehold property	-	(45,715)	-	-	(45,715)
Capital distribution	-	-	-	(8,345,100)	(8,345,100)
Revaluation of investment property	-	-	(10,000)	10,000	-
Other comprehensive income for the year	-	(45,715)	(10,000)	(8,335,100)	(8,390,815)
Total comprehensive income for the year	-	(45,715)	(10,000)	(1,635,241)	(1,690,956)
At 30 April 2023	1,000	99,285	63,730	8,714,572	8,878,587

The notes on pages 17 to 34 form part of these financial statements.

Page 12

SCOMAC SERVICES LTD

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 APRIL 2022

	Called up share capital	Revaluation reserve	Investment property revaluation reserve	Profit and loss account	Total equity
	£	£	£	£	£
At 1 May 2021 (as previously stated)	1,000	-	218,730	2,021,404	2,241,134
Prior year adjustment - correction of error	-	145,000	(145,000)	-	-
At 1 May 2021 (as restated)	1,000	145,000	73,730	2,021,404	2,241,134
Comprehensive income for the year
Profit for the year	-	-	-	8,328,409	8,328,409
Other comprehensive income for the year	-	-	-	-	-
Total comprehensive income for the year	-	-	-	8,328,409	8,328,409
At 30 April 2022	1,000	145,000	73,730	10,349,813	10,569,543

The notes on pages 17 to 34 form part of these financial statements.

Page 13

SCOMAC SERVICES LTD

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 30 APRIL 2023

				As restated
			2023	2022
			£	£

Cash flows from operating activities
Profit for the financial year	6,699,859	8,328,409
Adjustments for:
Depreciation of tangible assets	88,482	86,124
Loss on disposal of tangible assets	(7,930)	(8,644)
Interest paid	5,576	5,601
Interest received	(38,031)	(804)
Taxation charge	1,595,202	2,470,052
(Increase)/decrease in stocks	(2,955)	1,788,262
Decrease/(increase) in debtors	714,177	(7,845,717)
(Decrease)/increase in creditors	(188,225)	4,993,478
Net fair value losses recognised in P&L	10,000	-
Corporation tax (paid)	(2,036,502)	(273,228)
Net cash generated from operating activities	6,839,653	9,543,533

Page 14

SCOMAC SERVICES LTD

STATEMENT OF CASH FLOWS (CONTINUED)

FOR THE YEAR ENDED 30 APRIL 2023

			As restated
		2023	2022
		£	£



Cash flows from investing activities
Purchase of tangible fixed assets	(109,627)	(50,277)
Sale of tangible fixed assets	25,666	8,644
Interest received	38,031	804
Net cash from investing activities	(45,930)	(40,829)
Cash flows from financing activities
New secured loans	-	66,331
Repayment of loans	(15,536)	(131,989)
Capital distribution	(8,345,100)	-
Interest paid	(5,576)	(5,601)
Net cash used in financing activities	(8,366,212)	(71,259)
Net (decrease)/increase in cash and cash equivalents	(1,572,489)	9,431,445
Cash and cash equivalents at beginning of year	10,332,813	901,368
Cash and cash equivalents at the end of year	8,760,324	10,332,813

Cash and cash equivalents at the end of year comprise:
Cash at bank and in hand	8,760,324	10,426,625
Bank overdrafts	-	(93,812)
	8,760,324	10,332,813

The notes on pages 17 to 34 form part of these financial statements.

Page 15

SCOMAC SERVICES LTD

ANALYSIS OF NET DEBT

FOR THE YEAR ENDED 30 APRIL 2023


At 1 May 2022	Cash flows	At 30 April 2023
£	£	£

Cash at bank and in hand	10,426,625	(1,666,301)	8,760,324
Bank overdrafts	(93,812)	93,812	-
Debt due after 1 year	(56,318)	8,918	(47,400)
Debt due within 1 year	(60,733)	713	(60,020)
	10,215,762	(1,562,858)	8,652,904

The notes on pages 17 to 34 form part of these financial statements.

Page 16

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

1.	General information

Scomac Services Ltd is a private company limited by shares and incorporated in England and Wales. Its registered office is 247 High Street, Aldershot, Hampshire, England, GU12 4NG.

2.Accounting policies

2.1

Basis of preparation of financial statements

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 judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

2.2

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Profit and loss account within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

Page 17

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

2.Accounting policies (continued)

2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

∙the Company has transferred the significant risks and rewards of ownership to the buyer;

∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

∙the amount of revenue can be measured reliably;

∙it is probable that the Company will receive the consideration due under the transaction; and

∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

∙the amount of revenue can be measured reliably;

∙it is probable that the Company will receive the consideration due under the contract;

∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and

∙the costs incurred and the costs to complete the contract can be measured reliably.

2.4

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.

Page 18

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

2.Accounting policies (continued)

2.4

Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line and reducing balance methods.

Depreciation is provided on the following basis:

Freehold property	-		not depreciated
Plant and machinery	-	20%	reducing balance
Motor vehicles	-	25%	straight line
Fixtures and fittings	-	20%	reducing balance
Office equipment	-	20%	reducing balance
Computer equipment	-	20%	reducing balance

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.

2.5

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the reporting date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

2.6

Investment property

Investment property is carried at fair value determined annually by external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

2.7

Stocks

Stocks are valued at the lower of cost or net realisable value.

2.8

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Page 19

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

2.Accounting policies (continued)

2.9

Cash and cash equivalents

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.

In the Statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

2.10

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Company's Statement of financial position when the Company becomes party to the contractual provisions of the instrument.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date.

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts

Page 20

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

2.Accounting policies (continued)

2.10

Financial instruments (continued)

discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

2.11

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

2.12

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

2.13

Pensions

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 Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.

2.14

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

2.15

Leased assets: the Company as lessee

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Page 21

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

2.Accounting policies (continued)

2.16

Interest income

Interest income is recognised in profit or loss using the effective interest method.

2.17

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.

Increases in provisions are generally charged as an expense to profit or loss.

2.18

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:

∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and

∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

Page 22

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

3.	Judgments in applying accounting policies and key sources of estimation uncertainty

In the application of the Company's accounting policies, which are described in note 2, management is required to make judgements, estimates and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based upon 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are described below:
Amounts recoverable under contract
As described in note 2.2, revenue from a contract is recognised in the period in which the services are provided. The directors have considered stage of completion, expected losses and consideration due to ensure the revenue is recognised in the correct accounting period and the asset is recoverable.

Turnover	36,158,363	57,142,154
	36,158,363	57,142,154

All turnover arose within the United Kingdom.

Fees payable to the Company's auditor for the audit of the Company's financial statements

25,000

Page 23

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

Staff salaries	2,529,911	2,351,876
Social security costs	286,169	273,273
Cost of defined contribution scheme	50,365	45,958
	2,866,445	2,671,107

The average monthly number of employees, including the directors, during the year was as follows:

	2023	2022
	No.	No.

Staff	51	48
Directors	3	2

	54	50

7.	Directors' remuneration
		2023	2022
		£	£

Directors' emoluments	97,858	17,576
	97,858	17,576

8.	Interest receivable
		2023	2022
		£	£

	Other interest receivable	38,031	804
		38,031	804

Page 24

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

9.	Interest payable and similar expenses
		2023	2022
		£	£

	Bank interest payable	5,576	5,601
		5,576	5,601

Corporation tax
Current tax on profits for the year	1,623,300	2,053,555
Adjustments in respect of previous periods	-	398,668
Total current tax	1,623,300	2,452,223

Deferred tax
Origination and reversal of timing differences	(28,098)	17,829
Total deferred tax	(28,098)	17,829


	Tax on profit	1,595,202	2,470,052

Page 25

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

10.Taxation (continued)

Profit on ordinary activities before tax

8,295,061

10,798,461

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19.5% (2022 - 19%)	1,608,058	2,051,708
Effects of:
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment	24,439	3,778
Capital allowances for year in excess of depreciation	(9,246)	(2,057)
Provisions movements	49	126
Deferred taxation	(28,098)	17,829
Adjustments to tax charge in respect of prior periods	-	398,668
Total tax charge for the year	1,595,202	2,470,052

Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 26

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

11.	Tangible fixed assets

	Freehold property	Plant and machinery	Motor vehicles	Computer equipment	Total
	£	£	£	£	£
Cost or valuation
At 1 May 2022	460,715	12,160	356,665	162,955	992,495
Additions	-	1,345	94,565	13,717	109,627
Disposals	-	-	(23,648)	-	(23,648)
Revaluations	(45,715)	-	-	-	(45,715)
At 30 April 2023	415,000	13,505	427,582	176,672	1,032,759
Depreciation
At 1 May 2022	-	12,160	194,391	131,456	338,007
Charge for the year on owned assets	-	336	37,277	7,638	45,251
Charge for the year on financed assets	-	-	48,846	-	48,846
Disposals	-	-	(5,912)	-	(5,912)
At 30 April 2023	-	12,496	274,602	139,094	426,192
Net book value
At 30 April 2023	415,000	1,009	152,980	37,578	606,567
At 30 April 2022	460,715	-	162,274	31,499	654,488

The freehold property was last valued in 2023 by Matthew Seary of Derwent Hillside, an independent valuer, using market based evidence for similar properties sold in the local area.
The carrying amount that would have been recognised as at 30 April 2023 had the freehold property been carried under the cost model is £214,355.

Page 27

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

12.	Investment property

		Freehold investment property
		£
	Valuation
	At 1 May 2022	155,000
	Surplus on revaluation	(10,000)
	At 30 April 2023	145,000

The 2023 valuations were made by Matthew Seary of Derwent Hillside, on an open market value for existing use basis.

Historic cost	81,270	81,270
Accumulated depreciation and impairments	(19,505)	(17,879)
	61,765	63,391

Raw materials and consumables	12,955	10,000
	12,955	10,000

Page 28

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

14.

Debtors

						As restated
					2023	2022
					£	£


Trade debtors	2,006,936	3,376,909
Other debtors	50,134	470,612
Prepayments and accrued income	6,118,455	5,269,768
	8,175,525	9,117,289

15.	Cash and cash equivalents
		2023	2022
		£	£

Cash at bank and in hand	8,760,324	10,426,625
Less: bank overdrafts	-	(93,812)
	8,760,324	10,332,813

Lloyds TSB Bank PLC hold a fixed and floating charge over the undertaking and all property and assets present and future, including goodwill, book debts, uncalled capital, buildings, fixtures, and fixed plant & machinery. This debenture was dated 15/11/2011.

Page 29

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

Bank overdrafts	-	93,812
Bank loans	44,891	51,509
Trade creditors	4,734,681	5,646,626
Corporation tax	1,726,859	2,373,261
Other taxation and social security	1,254,907	986,936
Other creditors	66,798	76,348
Accruals and deferred income	897,728	432,431
	8,725,864	9,660,923


Bank loans	44,891	51,509
	44,891	51,509

Details of security provided:

The bank loans are secured against the freehold properties and by a fixed and floating charge.

Page 30

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

Bank loans	47,400	56,318
	47,400	56,318


Bank loans	47,400	56,318
	47,400	56,318

Details of security provided:

The bank loans are secured against the freehold properties and by a fixed and floating charge.

Amounts falling due within one year
Bank loans	44,891	51,509
Amounts falling due 1-2 years
Bank loans	47,400	56,318


	92,291	107,827

Page 31

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

19.	Deferred taxation

		2023
		£

	At beginning of year	(76,618)
	Charged to profit or loss	28,098
	At end of year	(48,520)

The provision for deferred taxation is made up as follows:
	2023	2022
	£	£

Accelerated capital allowances	(36,894)	(25,794)
Short term timing differences	934	871
Capital gains	(12,560)	(51,695)
	(48,520)	(76,618)

20.

Reserves

Revaluation reserve

This reserve is a non-distributable reserve and is the cumulative balance of the fair value movements on the the freehold property held by the company within fixed assets.

Investment property revaluation reserve

This reserve is a non-distributable reserve and is the cumulative balance of the fair value movements on the investment property held by the company within investment properties.

Profit and loss account

This reserve represents the accumulated distributable reserves of the company after taking into account any dividends and capital distribution.

21.	Capital Distributions

As shown in the Statement of Changes in Equity, there was a capital distributions of £8,345,100 (£nil), which is recognised directly against the profit and loss account. These payments were gifts to the Scomac Services Limited Employee Ownership Trust to facilitate their purchase of proportion of Scomac Services Limited shares.

Page 32

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

22.	Prior year adjustment

A revenue recognition timing error of £810,520 was identified relating to the year ended 30 April 2022. This has been corrected with a prior year adjustment. Increasing sales and accrued income. The corporation tax adjustment in relation to this is £153,999.
A missing corporation tax liability of £398,668 was identified relating to earlier years so this has been adjusted via a prior year adjustment. Increasing the corporation tax charge and liability.
These adjustments have resulted in a net increase in reserves as of 30 April 2022 of £257,853.
Presentation disclosures were made due to the current year figures being audited. These do not impact upon profit.
A £4,433,183 reclassification from stock and work in progress to prepayments and accrued income for application income brought forward into 2022.
An adjustment of £145,000 was made to correctly split the value of the investment property and freehold property within tangible fixed assets and investment property which resulted in a reclassification in the revaluation reserves of the same value.
£1,707,375 was reclassified from wages to subcontract labour also within cost of sales.

23.	Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £50,365 (2022 - £45,958). Contributions totalling £10,069 (2022 - £9,224) were payable to the fund at the reporting date and are included in creditors.

24.	Transactions with directors

During the year the directors had the following transactions with the company:
Mr D Mcloskey had a directors loan account which was overdrawn by £172,448 as at 1 May 2022, the maximum it was overdrawn was £230,775 on 28 April 2023. The balance was cleared on 28 April 2023.
Mr D Scott had a directors loan account which was overdrawn by £199,571 as at 1 May 2022, the maximum it was overdrawn was £2,780,775 on 28 April 2023. The balance was cleared on 28 April 2023.

25.	Related party transactions
	Total key management personnel compensation excluding dividends amounted to £120,003 (2022 - £111,612).

Page 33

SCOMAC SERVICES LTD

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 APRIL 2023

26.	Controlling party

The parent undertaking of this company is The Scomac Services Limited Employee Ownership Trust, a trust registered in England and Wales, by virtue of the fact that it owns 100% of the ordinary share capital of the company.

Page 34