Financial Statements TRL

Financial StatementYear ending 31st March 2012Year ending 31st March 2012

Financial Statements 2012 – Total Response Limited

Total Response Limited

Financial Statements for the year 1 April 2011 to 31 March 2012

Page Contents 1 Chair’s Statement - review of activities 1 Directors’ Report 2 – 3 Statement of Board of Directors’ Responsibilities 4 Operating and Financial Review 5 Auditors’ Report 6 Income and Expenditure Account 7 Balance Sheet 8 Cash Flow Statement 9 Notes to the Cash Flow Statement 10 – 15 Notes to the Financial Statements

Registered Office

The Gateway, The Auction Yard, Craven Arms, Shropshire SY7 9BW

Company Registration No. 6178863


1

Chair’s Statement

This is Total Response Limited’s 5th trading period since formation. I am pleased to report that the company has produced a surplus of £11,280 (£7,588 in 2011). This is after making a larger contribution for its share of overheads of the Group, to more fairly reflect the costs and after making reserves for possible bad debts and other charges. Turnover has grown by nearly 9% in the year with the majority of work coming from within Shropshire Housing Group. This has enabled the workforce to be increased from 97 to 98. South Shropshire Housing Association commissioned £2,500,931 and Meres and Mosses Housing Association commissioned £2,108,002. Private works accounted for £649,141. The private works contributed £105,000 towards overheads (£158,000 in 2011). It has been a challenging year for the company. A new computer system has been installed and this will enable a better level of service to customers in

the future with the addition of an appointment and scheduling service. A more efficient handling of repairs is envisaged with management information available showing the profitability of each job undertaken. The company has made a significant contribution to the parent for the hand held computers now in use by all operatives. A total of £50,000 will be paid off by 2012/13. I would like to thank all staff for the dedication and commitment they have shown throughout the year as they have sought to achieve an efficient and effective maintenance service in spite of very difficult national trading conditions. Once again they have risen to the challenge admirably. My thanks also for the support of my fellow directors. John Stringer Chair 16th July 2012

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Directors’ Report

Members of the Board

The members of the Board who served during the year were as follows: John Stringer (Chair) Martin Buxey Martin Holland Stephen Donkersley The Board reports that the company produced a surplus of £11,280, compared to the budgeted surplus of £97,986 at the latest revised stage. Turnover was over £5.6 million.

Future developments

The Board is looking to further extend its business operations in the county. This will include further work for Meres & Mosses Housing Association and investigating opportunities to increase its level of private works.

Cash Flow and Liquidity

The cash flow from operating activities during the year was £184,916. By order of the Board John Stringer Chair 16th July 2012


2

Statement of Board of Directors’ Responsibilities The Directors are responsible for preparing 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 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 judgments and accounting

estimates that are reasonable and prudent;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• 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 safe-guarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Directors’ Indemnity

The Directors have confirmed that the company does have Directors and Officers Insurance in place.

Internal Controls

The Performance Committee, on behalf of the Group and all its subsidiaries, has reviewed the effectiveness of the system of internal control, including the sources of assurance agreed by the Board as being appropriate for that purpose. On the basis of the evidence provided by the Assistant Director of Performance & Governance which has been considered by the Group Board on 1st June 2012, we are satisfied that there is sufficient evidence to confirm that adequate systems of internal control existed and operated throughout the year. We are also satisfied that those systems were aligned to an ongoing process for the management of the significant risks facing TRL and the Group as a whole. No weaknesses were identified which would have resulted in material misstatement or loss and which would have required disclosure in the financial statements.

Financial Instruments

The company does not have any abnormal exposure to price, credit, liquidity and cash flow risks arising from its trading activities. The company does not enter into any hedging transactions and no trading in financial instruments is undertaken.

Disclosure of Information

to Auditors

In the case of each of the persons who are Directors of the company at the date when this report was approved: • So far as each of the Directors is aware,

there is no relevant audit information of which the company’s auditors are unaware; and


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• Each of the Directors has taken all the

steps that they ought to have taken as a Director to make them aware of any relevant audit information and to establish that the company’s auditors are aware of that information.

Going Concern

After reviewing the company’s budget for 2012/2013 and based on normal business planning and control procedures, the Directors of the Board have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The financial statements have therefore been prepared on a going concern basis.


4

Operating and Financial Review

Background

Total Response Limited (TRL) is an independent private limited company (registration number 6178863) formed in June 2007 to provide high quality maintenance services to Shropshire Housing Group and external customers, and any other enterprises within the communities of Shropshire and Herefordshire.

Operating Review On 1st June 2007 Total Response Limited was established as a private limited company. It has delivered a quality repairs service to South Shropshire Housing Association and Meres and Mosses as well as private individuals. On 30th July 2007 it became a wholly owned subsidiary of the Shropshire Housing Group. During the current year the company has managed the Facilities Management contract for the Gateway at Craven Arms and has won over £649,141 worth of private works. This has contributed around £105,000 to overhead costs and has allowed a cost effective service to be delivered to the tenants of Meres & Mosses and South Shropshire Housing Associations.

Reporting Structure The Board comprises up to 5 members. The Board is responsible for the company’s continuing strategy and policy framework. It delegates the day to day management and implementation of that framework to the Senior Management team. The Board now meets quarterly.

Continuous Improvement We are committed to achieving excellent performance across the whole of our business and services. The Group has a comprehensive Performance Management framework which ensures a clear focus on performance improvement and clear responsibility for scrutiny on performance at various levels. The Performance Management Group monitors benchmarked data together with performance indicators, reports and best practice visits. The group is made up mainly of senior managers from across the Shropshire Housing Group.

Risks and uncertainties The Group’s managers have a clear responsibility for identifying risk facing each of the areas in which they operate and for putting in place procedures to mitigate and manage risk. It is the Performance Committee’s responsibility to review and assess those risks.

Financial Review In 2011/2012 the company has achieved a surplus of £11,280. This is an improved position from 2011 (£7,588) and further Group recharges part paid for handheld devices of around £25,000.


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Independent report of the Auditors to the members of

Total Response Limited We have audited the financial statements of Total Response Limited for the year ended 31st March 2012 which comprise the Income and Expenditure Account, Balance Sheet, Cash Flow Statement and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). Respective responsibilities of the Board

and Auditors As explained more fully in the Directors’ Responsibilities Statement set out on page 2, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors. 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.

Scope of the audit of the financial statements

A description of the scope of an audit of financial statements is provided on the APB's website at www.frc.org.uk/apb/scope/private.cfm.

Opinion on the financial statements

In our opinion the financial statements;

• give a true and fair view of the state of the company’s affairs as at 31st March 2012 and of its surplus 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.

Opinion on the other matter prescribed

by the Companies Act 2006

In our opinion the information given in the Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Matters on which we are required to report by exception

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.

Glen Jones (Senior Statutory Auditor) For and on behalf of Mazars LLP, Chartered Accountants (Statutory Auditor) 45 Church Street Birmingham B3 2RT


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Income and Expenditure Account for the year ended 31st March 2012

2012 2011 £ £ Note Turnover 2 5,652,957 5,187,934 Operating costs 2 (5,641,857) (5,180,524) Operating surplus 2 11,100 7,410 Loss on sale of fixed assets - - Surplus on ordinary activities before interest

11,100 7,410

Interest receivable and similar income 3 180 178 Interest payable and similar charges (-) (-) Surplus on ordinary activities before taxation 4 11,280 7,588 Taxation on surplus on ordinary activities 6 - - Surplus for the year charged to reserves 13 11,280 7,588

All of the above relate to continuing activities. There are no recognised gains or losses other than the surplus for the year.


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Registered No 6178863

Balance Sheet at 31st March 2012

2012 2011 Note £ £ £ £ Tangible fixed assets Tangible assets cost 7 383,616 364,170 Less Depreciation 7 (348,667) (314,962) 34,949 49,208 Current assets Stock 8 148,015 131,598 Debtors 9 535,826 337,153 Investments 10 52,193 52,193 Cash at bank and in hand 112,824 26,274 848,858 547,218 Creditors: amounts falling due within one year

11 (981,718)

(705,617)

Net current liabilities (132,860) (158,399)

Total assets less current liabilities (97,911) (109,191) Capital and reserves Called up share capital 12 1 1 Revenue reserve 13 (97,912) (109,192) (97,911) (109,191)

These financial statements were approved by the Board of Management on July 2012 and were signed on its behalf by John Stringer Chair Martin Buxey Director


8

Cash Flow Statement for the year ended 31st March 2012

2012 2011 Notes £ £ £ £ Net cash inflow from operating activities

(a) 184,916

18,449

Returns on investments and servicing of finance

Interest received 180 178 Interest paid - - 180 178 Capital expenditure Proceeds on disposal of fixed assets

- -

Purchase of other tangible fixed assets

(19,446) (12,764)

(19,446) (12,764) Taxation - - Financing Principal lease repayments (79,100) (23,499) Net shares issued - - (79,100) (23,499) Increase / (Decrease) in cash

(c)

86,550

(17,636)


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Notes to the Cash Flow Statement for the year ended 31st March 2012

(a) Reconciliation of operating surplus to net cash inflow from operating activities

2012 2011 £ £ Operating surplus 11,100 7,410 Depreciation 33,705 87,625 (Increase) in debtors (198,673) (128,806) (Increase) in stock (16,417) (4,038) Increase in creditors 355,201 56,258 Net cash inflow from operating activities 184,916 18,449

(b) Reconciliation of net cashflow to movement in net funds

2012 2011 £ £ Increase / (Decrease) in cash in the year 86,550 (17,636) Housing loans received - - Change in net funds 86,550 (17,636) Net funds brought forward 26,274 43,910 Net funds carried forward 112,824 26,274

(c) Analysis of changes in net funds

At 31st March At 31st March 2011 Cash Flow 2012 £ £ £ Investments - - - Cash at bank and in hand 26,274 86,550 112,824 26,274 86,550 112,824 Debt due after 5 years - - - Total 26,274 86,550 112,824


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Notes (forming part of the financial statements)

1 Accounting policies

The financial statements have been prepared in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). A summary of the more important accounting policies, which have been consistently applied, is set out below. The accounting policies were reviewed by the Performance Committee on 9th May 2012 in accordance with FRS18. Accounting convention The financial statements are prepared under the historical cost convention. Turnover Turnover represents work done on behalf of other members of Shropshire Housing Group and external work done for other entities or private individuals, together with facilities management for the Gateway. Fixed assets and depreciation Other tangible fixed assets are stated at cost and are written down to their residual value over their expected useful life on a straight line basis at the following annual rates: Office equipment, fixtures & fittings - 15% to 25% Plant & machinery - 15% to 25% Vehicles - 25% Stock Stock is stated at the lower of cost and net realisable value. Operating leases Rentals payable under operating leases are charged on a straight-line basis over the term of the lease. Finance leases Assets acquired under finance leases are capitalised and interest charged to revenue. Pension costs Contributions payable to the company’s pension scheme are charged to the income and expenditure account so as to spread the cost of pensions over the service lives of employees in the schemes. FRS 17 is followed. Taxation The charge for taxation is based on the results for the year and takes into account taxation deferred (or accelerated) because of timing differences between the treatment of certain items for taxation and accounting purposes. Provision is made for deferred tax on a full provision basis.


11

Notes (continued) 2 Turnover, operating costs and operating surplus

2012 2011 Turnover

£

Operating Costs

£

Operating (Deficit) / Surplus

£

Turnover £

Operating Surplus / (Deficit)

£

External work of TRL 649,141 (703,261) (54,120) 736,088 (58,640) Internal work of TRL 4,608,933 (4,543,713) 65,220 4,066,004 66,050 Facilities Management 394,883 (394,883) - 385,842 -

5,652,957 (5,641,857) 11,100 5,187,934 7,410

3 Interest receivable and similar income

2012 2011 £ £ Interest receivable from bank deposits 180 178

4 Surplus on ordinary activities before taxation

2012 2011 £ £

Surplus on ordinary activities before taxation is stated after charging:

Depreciation of tangible fixed assets 33,705 87,625 Auditors’ remuneration (including VAT):(This item is shown within group costs)

In their capacity as auditors - - In respect of other services - - Amounts payable in respect of hire of plant and machinery 186,005 181,543 Amounts payable in respect of rents of land and buildings 180,876 178,470


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Notes (continued) 5 Staff costs

2012 2011 £ £ Wages and salaries 2,311,176 2,162,483 Social security costs 185,082 170,614 Other pension costs 99,947 102,307 2,596,205 2,435,404 Average number of full-time equivalent persons employed during the year 98

97

These were categorised as: Office Teams 16 16 Operatives 82 81

98 97 No directors received payments from Total Response Limited during the year. 6 Taxation 2012

£ 2011

Surplus on ordinary activities before tax 11,280 7,588

Tax on surplus on ordinary activities at 26% (2011 - 26%) 2,932

1,972

Costs not deductible for tax purposes (primarily depreciation on tangible fixed assets) 8,763

22,782

Capital allowances (restricted claim) (7,650) (5,281) Unrelieved tax losses utilised (4,045) (19,473)

Current charge on the accounts -

-


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Notes (continued) 7 Tangible fixed assets

Office

equipment, fixtures &

fittings

Plant and machinery &

vehicles

Total

£ £ £ Cost

At beginning of year 34,178 329,992 364,170

Additions 11,570 7,876 19,446 Disposals - - -

At end of year 45,748 337,868 383,616

Depreciation

At beginning of year 15,283 299,679 314,962 Charge for the year 6,862 26,843 33,705

Eliminated on disposals - - -

At end of year 22,145 326,522 348,667

Net book value At 31st March 2012 23,603 11,346 34,949 At 31st March 2011 18,895 30,313 49,208 8 Stock 2012 2011 £ £ Consumable maintenance stock 148,015 131,598 9 Debtors 2012 2011 Due within one year £ £ Prepayments and accrued income 535,826 337,153 535,826 337,153 10 Current asset investments 2012 2011 £ £ Land held for development / resale 52,193 52,193


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Notes (continued) 11 Creditors: amounts falling due within one year 2012 2011 £ £ Trade creditors 291,114 225,080 Accruals and deferred income 661,106 359,126 Finance leases - 102,600 VAT 29,498 18,811 981,718 705,617 12 Called up share capital 2012 2011 £ £ Issued and fully paid shares of £1 each: At beginning of year 1 1 Issued during the year - - Relinquished during the year - - At end of year 1 1 13 Reserves Revenue

reserve £

Balance brought forward (109,192) Surplus in the year 11,280 Balance carried forward (97,912) 14 Pension obligations All employees working within Total Response Limited are employed by South Shropshire Housing Association or Meres & Mosses Housing Association and, as such, they are members of the Social Housing Pension Scheme (SHPS) or the Shropshire County Council Pension Scheme. Full details and actuarial valuations of these schemes are disclosed in South Shropshire Housing Association’s, and Meres & Mosses Housing Association’s Financial Statements and Shropshire Housing Limited group accounts. 15 Capital commitments 2012

£ 2011

£ Capital expenditure contracted for but not provided in the financial statements

-

-

Capital expenditure authorised by the Board of Management but not yet under contract

35,057

62,000

This will be financed from internal funds.


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Notes (continued) 16 Other financial commitments

The company was committed to making the following annual payments under non-cancellable operating leases: Operating leases which expire:

2012 £

2011 £

Property Plant Total Total

Within 1 year - 86,361 86,361 73,013 1 - 2 years - 59,614 59,614 27,774 2 - 5 years - - - 38,535 over 5 years - - - 97,027 - 145,975 145,975 236,349 17 Contingent liabilities

There were no contingent liabilities at 31st March 2011 or 31st March 2012. 18 Legislative provisions

The company is incorporated as a private limited company under the Companies Act 2006, Registered No. 6178863. The company has taken advantage of FRS8 exemption not to disclose intra-group transactions. The ultimate parent undertaking is Shropshire Housing Limited, an Industrial and Provident Society regulated by the Homes and Communities Agency.

Documents

Financial Statements TRL