REG - Assoc British Enging - Annual Financial Report
28/01/2022 15:00
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RNS Number : 0274A Associated British Engineering PLC 28 January 2022
Company Registration No. 00110663 (England and Wales)
ASSOCIATED BRITISH ENGINEERING PLC
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 SEPTEMBER 2021
ASSOCIATED BRITISH ENGINEERING PLC Company Registration No. 00110663 (England and Wales)
REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
CONTENTS Page
Financial
highlights 1
Chairmen's
statement 2
Directors' report
3
Strategic
report
6
Report of the independent auditor - Group
9
Group and Parent Company accounting
policies 15
Consolidated income statement
21
Consolidated statement of comprehensive
income 22
Group statement of financial
position 23
Group statement of changes in
equity 24
Group cash flow
statement
25
Notes to the Group financial
statements 26
Company statement of financial position
36
Company statement of changes in
equity 37
Company cash flow statement
38
Notes to the Company financial statements
39
Statement of directors'
responsibilities 45
Corporate governance
report 46
Directors' remuneration
report
51
Directors, registered office and
advisers 54
The Directors' Report on pages 3 to 5 and the Directors' Remuneration Report on pages 51 to 53 have each been drawn up in accordance with the requirements of English law and liability in respect thereof is also governed by English law. In particular, the responsibility of the directors for these reports is owed solely to Associated British Engineering plc.
The directors submit to the members their Report and Accounts for the Group
for the year ended 30 September 2021. Pages 1 to 8 and 46 to 54, including the
Financial Highlights, Chairmen's Statement, Directors' Report, Strategic
Report, Corporate Governance Report, Directors' Remuneration Report and the
Directors, Registered Office and Advisers page form part of the Report of the
Directors.
ASSOCIATED BRITISH ENGINEERING PLC
FINANCIAL HIGHLIGHTS
Year Period
ended ended
30 Sep 30 Sept
2021 2020
£'000 £'000
REVENUE - 165
OPERATING (LOSS)/PROFIT (88) 139
(LOSS)/PROFIT BEFORE TAXATION (87) 145
OTHER COMPREHENSIVE INCOME 385 327
NET ASSETS 889 591
BASIC (LOSS)/PROFIT PER 2.5p ORDINARY SHARE (4.25p) 263.0p
EQUITY SHAREHOLDERS' FUNDS PER 2.5p ORDINARY SHARE £0.43 £0.29
ASSOCIATED BRITISH ENGINEERING PLC
CHAIRMEN'S STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2021
As you will be aware , in August 2020 we disposed of our subsidiary British
Polar Engines Limited (BPE) and as part of the process we recovered assets for
the Company and the Pension Fund. In addition the Company was also able to
remove from the Group balance sheet as at September 2020 the liability for the
Pension Fund. The net result was to create positive assets as at September
2020 of £591,000, which in the year to September 2021 had increased to
£889,000. As at September 2020 the Company held cash of £186,000 which rose
to £489,000 as at September 2021.
As a result of the process in August 2020 and the sale of the Group's main
trading activities the group has had no trading activities in 2021;
therefore there is no turnover for the year to September 2021. Group operating
costs have been reduced to £87,000 for the year to September 2021.
During the year to September 2021 the Company was able to realise cash from
some of its assets amounting to £380,000 and these created a realised gain of
£149,000 and a gain, previously reported as unrealised, of £236,000;
resulting in a combined Comprehensive Profit of £385,000 in the year to
September 2021 (2020 £327,000). The BPE Pension Fund, some of whose assets
the Directors monitor on their behalf, was also able to avail itself of the
same opportunity to realise assets .
As the Company currently has no trading activity and only two directors and
one employee within the group, the group has not been affected by the COVID
Pandemic or Brexit in either 2021 or in the first part of 2022.
The net result for 2021 shows an increase in retained earnings of the Group of
£208,000 and an increase in Revaluation Reserve of £90,000. (The results for
the prior year were affected by the release of the Pension Fund Liability
and therefore are not directly comparable).
As you will note in the balance sheet the Group continued to hold Assets for
Sale, which included a material quoted holding in one entity, the
valuation of which is subject to the market for biotech companies on NASDAQ.
Over the past 12 months this holding has ranged from over $40 to $12 per
share; the current price is lower than the value at the September year end.
Colin Weinberg was a director of the parent company of the investment and was
instrumental in the development of that business. He resigned his directorship
in January 2019 and, in view of the potential conflicts of interest that may
arise, he is not participating in decisions regarding the sale of that
investment and its parent company.
It is unfortunate to note that the Auditor still deems it necessary to give a
"Qualified Opinion" that as you will note in their report relates solely to
the lack of accounting information from the former subsidiary BPE. This in no
way affects the accounts for 2021 or the balance sheet for any of the years
reported on herein and we advise you to read the audit report accordingly.
Nonetheless the Directors are looking for the suspension to be lifted and to
restart trading in its shares as soon as possible.
In the meantime the directors are containing all costs and are not taking any
remuneration from the Company for their services as directors. They continue
to review any possible corporate developments as they arise with a view to
developing or acquiring a new business activity within the Group.
We wish all our shareholders good health and we look forward to new
developments in 2022.
Colin Weinberg and Rupert Pearce Gould
Chairmen
Date: 27 January 2022
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2021
The directors submit their report and audited accounts for the year ended 30
September 2021.
RESULTS AND DIVIDENDS
The Group's loss after tax amounted to £86,572 (2020: £144,800 profit). The
directors are unable to recommend a dividend on the ordinary shares for the
year (2020: £Nil per ordinary share).
DIRECTORS
The names of the directors who served during the year from 1 October 2020 to
30 September 2021 are:
Mr C Weinberg Director
Mr R Pearce Gould Director
Biographical details of the directors are set out on page 54.
With regard to the appointment and replacement of directors, the Company is
governed by its Articles of Association, the Corporate Governance Code, the
Companies Act 2006 and related legislation.
In accordance with the Articles of Association Mr R Pearce Gould retires by
rotation and, being eligible, offers himself for re-election.
DIRECTORS' AND OFFICERS' LIABILITY INSURANCE
The group has, as permitted by s.234 and s.235 of the Companies Act 2006,
maintained insurance cover on behalf of the directors and secretary
indemnifying them against certain liabilities which may be incurred by them in
relation to the company.
SUBSTANTIAL HOLDINGS
As at 30 September 2021 the Company had been notified of the following
substantial interests, in excess of 3%, in the issued ordinary share capital
of the Company:
Shareholders Notes
The Bank of New York (Nominees) Limited The Bank of New York Nominees owns 12.98% of issued ordinary shares, of which
Colin Weinberg. owns 3.44% of issued share capital.
Fiske Nominees Limited (FISKPOOL) FISKPOOL owns 12.87% of issued ordinary shares, of which Stephen Cockburn has
a combined beneficial and non beneficial interest in 7.53% of issued share
capital.
R A Pearce Gould
Mr Pearce Gould's overall holding is 12.89% of issued ordinary shares, which
includes Rulegale below.
Stephen Cockburn Mr Cockburn's overall beneficial and non beneficial interest is 9.18% of
issued ordinary shares, including Fiske Nominees above.
C Weinberg Mr Weinberg's overall holding is 8.22% of issued ordinary shares, including
Bank of New York above.
Lynchwood Nominees Limited (2006420) Lynchwood owns 6.74% of issued ordinary shares.
Rulegale Nominees Limited (JAMSCLT) JAMSCLT owns 5.28% of which Mr R A Pearce Gould has all of the issued ordinary
shares.
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS' REPORT (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
___________________________________________________________________________________
Shareholders Notes
Hargreaves Lansdown (Nominees) Ltd Hargreaves Lansdown owns 5.27% of issued ordinary shares.
(VRA)
W B Nominees Limited W B Nominees Limited owns 3.51% of issued ordinary shares.
Interactive Investor Services Nominees Limited Interactive Investor Services Nominees Limited owns 3.53% of issued ordinary
shares.
Barclays Direct Investing Nominees Ltd (Clients)
Barclays Direct owns 3.68% of issued ordinary shares.
Vidacos Nominees Limited (BBUCCC) BBUCCCC owns 3.40% of which Graeme Marshall owns all of the issued ordinary
shares.
Winterflood Securities Limited (WINSCREEP) Winterflood Securities owns 3.04% of issued share capital.
BENEFICIAL INTERESTS IN SIGNIFICANT CONTRACTS
None of the directors had a material interest in any contract of significance
to which the Company or any of its subsidiaries was party during the period.
BENEFICIAL INTERESTS IN THE SHARE CAPITAL OF THE COMPANY
The beneficial interests of the directors, who served during the year, their
spouses and dependents in the share capital of the Company according to the
register kept by the Company as at 30 September 2021 were as follows:
Ordinary shares of
2.5p 2.5p
2021 2020
No. No.
Mr C Weinberg 168,404 168,404
Mr R Pearce Gould 264,049 264,049
No share options or derivatives were held by any of the directors at 30
September 2021.
Since 30 September 2020 and up to and including 30 September 2021 there have
been no changes in the directors' interests in the share capital of the
Company.
FINANCIAL INTERESTS
The Group uses various financial instruments and these include cash, equity
investments and various others, such as trade receivables and trade payables
which arise directly from its operations. The main purpose of these financial
instruments is to raise finance for the Group's operations.
Further details of the policies adopted by the Group in respect of the
financial risk management are included within note 17 to the Group financial
statements and the Strategic Report.
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS' REPORT (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
FINANCIAL INTERESTS - CAPITAL
The structure of the Group's and Company's capital, at nominal value, is as
follows:
No. in issue Nominal Value Total % of
Value Capital
£ £ £
Ordinary shares 2,048,990 0.025 51,255 1.9
Deferred shares 1,313,427 1.975 2,594,018 98.1
The Deferred Shares are considered to be of negligible value and therefore
have not been reported on in the holdings of directors.
DISABLED PERSONS
It is the Group's policy to give sympathetic consideration to the recruitment,
continuing employment, training, career development and promotion of disabled
persons.
EMPLOYEES
The Group recognises the importance of employees to the success of the
business and ensures that they are fully informed of events that directly
affect them and their working environment.
ENERGY AND EMISSIONS DATA
As the Group has not consumed more than 40,000 kWh of energy in this reporting
period, it qualifies as a law energy user under these regulations and is not
required to report on its emissions, energy consumption or energy efficiency
activities.
GOING CONCERN
After making appropriate enquiries, the Directors have a reasonable
expectation that the Company and the Group will have adequate resources to
continue in operational existence for the foreseeable future.
AUDITOR AND DISCLOSURE OF INFORMATION TO THE AUDITOR
The auditor, Bright Grahame Murray, is deemed to be reappointed under section
487(2) of the Companies Act 2006.
So far as the Directors are aware, there is no relevant audit information that
has not been brought to the attention of the Company's auditor. Each Director
has taken all reasonable steps to make himself aware of any relevant audit
information and to establish that such information was provided to the
auditor.
This confirmation is given and should be interpreted in accordance with the
provisions of section 418 of the Companies Act 2006.
A resolution to confirm the reappointment of Bright Grahame Murray as auditor
of the Company will be proposed at the 2021 AGM. The confirmation has been
recommended to the Board by its Audit Committee and Bright Grahame Murray have
indicated their willingness to remain in office.
By order of the Board
Colin Weinberg
For and on behalf of the Board of Directors
Date: 27 January 2022
ASSOCIATED BRITISH ENGINEERING PLC
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2021
BUSINESS REVIEW
A review of the business and of events during the year is contained in the
Chairmen's Statement on page 2 which forms part of the Strategic Report.
BUSINESS MODEL AND STRATEGY
The Associated British Engineering Group has one subsidiary
undertaking:
Akoris Trading Limited ("Akoris").
On 4 August 2020, the Group disposed of its investment in British Polar
Engines Limited ("BPE"), as outlined in note 9, page 41 of these financial
statements.
S.172 STATEMENT
The directors of the Company are required under section 172 of the Companies
Act 2006 ('s.172') to act in a way that promotes the success of the Company
for the benefit of its shareholders as a whole, whilst having regard to the
following matters (amongst other things): the likely long term consequences;
the interests of the Company's employees; the business relationships with
suppliers and customers; the impact on the community and the environment;
reputation for high standards of business conduct; and acting fairly between
shareholders.
The governance framework adopted by the Associated British Engineering Group
has been applied by the Company and its subsidiary, Akoris Trading Limited,
and the matters that the directors of the Company are responsible for
considering under s.172 have been considered to an appropriate extent by the
Board in relation to both Company and its subsidiary. Further details of how
the Board has considered the matters set out in s.172 (for the Group and for
the Company) are set out in the Associated British Engineering Plc Annual
Report and Accounts, which does not form part of this report. During the year,
the directors have also considered, both individually and together, relevant
matters where appropriate.
PRINCIPAL RISKS AND UNCERTAINTIES FACING THE BUSINESS
The Group's main operating business was its subsidiary Akoris.
The Board controls risks by adopting appropriate strategies and maintaining
strong systems of internal control.
These strategies however cannot attempt to eliminate all risk, but control the
risks that we believe are appropriate to take to maintain the group. Details
of the group's risk management processes are given in the Corporate Governance
report on page 46.
We have considered below the current risk factors that are considered by the
Board to be material. However, in a changing world, new risks may appear or
immaterial risks may become more important, and the directors will develop
appropriate strategies.
The Board is looking to identify additional business to acquire with either
high profitability or with the prospect of significant profitability.
Market conditions
The company has currently no significant trade. There remains a risk regarding
the marketability of some of its investments and the ability to liquidate
them.
Reputational risk
Over many periods the Group has built up a reputation for integrity and is
aware that this can be easily damaged with the consequential cost. To mitigate
this risk, policies are in place which, cover standards of behaviour and good
governance.
ASSOCIATED BRITISH ENGINEERING PLC
STRATEGIC REPORT (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
COVID-19 risk
Considering the low number of employees, COVID-19 does not affect the Group.
Brexit risk
As the service we provide is predominantly delivered to UK-based customers,
the impact of Brexit on our business is not as significant as it is to other
businesses. As a Board, we will continue to closely monitor developments in
the UK Government's Brexit plans and any potential impacts on the company and
so like most businesses we are keen to have certainty over how Brexit will be
implemented.
Defined Benefit pension scheme funding
As from 4 August 2020, the date of sale of the subsidiary, the Group no longer
had any exposure to any defined benefit scheme.
Cyclical nature of the business
The trading outlook for the Group remains unpredictable due to the requirement
to identify a trading business in the midst of a Global pandemic
Further consideration of risks and uncertainties in respect of financial
instruments that face the Group and Company is contained in note 17 to the
Group financial statements.
KEY PERFORMANCE INDICATORS
The Group uses various indicators to monitor its progress but in view of the
low level of trade providing a report does aid any understanding.
Our employees
Whilst the Group does not have a specific human rights policy, it has a strong
commitment to upholding the principles of human rights across our business.
CORPORATE GOVERNANCE
Details of corporate governance, which is part of this report for the year to
30 September 2021, are disclosed in the Corporate Governance report on page
46.
CORPORATE SOCIAL RESPONSIBILITY
The Group is committed to the protection of the environment and the
development of processes which ensure that any adverse impact on the
environment arising from its trading activities is minimised by encouraging
reduction in waste, awareness of recycling, and encouraging employees to pay
regard to environmental issues.
ASSOCIATED BRITISH ENGINEERING PLC
STRATEGIC REPORT (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
Employees
The Group's ability to achieve its commercial objectives and to service the
needs of society and its customers in a profitable and competitive manner
depends on the contribution of its employees. Employees are encouraged to
develop their contribution to the business wherever they happen to work. The
Group regularly keeps employees up to date with financial and other
information.
The Group currently employs three people, made up of two male part time
executives and one male part time administrator.
Total no. of officers/employees Number of males % Number of females %
Senior Management 2 100 0
Whole Workforce 1 100 0
By order of the Board
Colin Weinberg
For and on behalf of the Board of Directors
Date: 27 January 2022
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF
ASSOCIATED BRITISH ENGINEERING PLC
Independent auditor's report to the members of Associated British Engineering
PLC
Qualified opinion
We have audited the financial statements of Associated British Engineering PLC
(the "parent company") and its subsidiary companies (the "Group") for the year
ended 30 September 2021 which comprise of the consolidated income statement,
the consolidated statement of comprehensive income, the Group statement of
financial position, the Group statement of cash flows, the Group statement of
changes in equity, the Company balance sheet, the Company statement of changes
in equity, the Company statement of cash flows and the 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 UK adopted international accounting standards.
In our opinion, except for the effects on the corresponding figures of the
matter described in the Basis for qualified opinion section of our report, the
financial statements:
· give a true and fair view of the state of the group's and company's
affairs as at 30 September 2021 and of its loss for the year then ended;
· have been properly prepared in accordance with UK adopted
international accounting standards; and
· have been prepared in accordance with the requirements of the
Companies Act 2006.
Basis for qualified opinion
On 4 August 2020 in the previous accounting period ended 30 September 2020 the
company disposed of its investment in British Polar Engines Limited which was
the main trading subsidiary of Associated British Engineering PLC. We were and
continue to be unable to obtain from the management of British Polar Engines
Limited details of the profit and loss account during the period 1 April 2019
until the date of disposal in August 2020. We were therefore unable to confirm
or verify by alternative means the amounts included in the prior period
consolidated statement of comprehensive income. As a result of this matter we
were unable to determine whether any adjustments might have been found
necessary to the elements included in the prior period consolidated statement
of comprehensive income or the prior period consolidated statement of cash
flows. This did not impact our work on the consolidated statement of financial
position as at the 30 September 2020 or 30 September 2021 and the remainder of
the group, as the assets and liabilities of the disposed subsidiary are not
included at either 30 September 2020 or 30 September 2021. The parent company
statement of financial position for both periods reported are also unaffected
as the investment has been disposed. Our audit opinion on these financial
statements is modified because of the possible effect on the comparative
figures presented in the consolidated statement of comprehensive income.
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 group and the parent 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 as applied to listed public interest
entities, 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 qualified
opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the financial statements of the current
period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those
which had the greatest effect on the overall audit strategy, the allocation of
resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF
ASSOCIATED BRITISH ENGINEERING PLC
Key Audit Matter- Group How the matter was addressed in the audit- Group
Risk of management over ride of internal controls We performed a fraud risk assessment in order to identify specific areas of
risk relating to management over ride of controls.
ISAs (UK) require that we consider this.
We preformed testing of journals, with particular focus on manual adjustments
to the income statement, to mitigate the risk of manipulation of revenue and
the loss figures.
We independently assessed and challenged accounting estimates relevant to the
financial statements for evidence of bias by the Directors that may represent
a risk of material misstatement due to fraud for example accruals and
provisions.
We assessed the overall control environment of the Group and held meetings
with the directors.
Other than the matter described in the Basis for qualified opinion section, we
have determined there are no other key audit matters to be communicated in our
report.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation of the directors'
assessment of the entity's ability to continue to adopt the going concern
basis of accounting included:
· Testing the model used for management's going concern assessment
which is primarily a cash flow forecast. Management's assessment covered the
24 month period ended September 2023. We assessed this process by reviewing
the assumptions and whether there was adequate support for these assumptions.
· We considered the potential mitigating actions that management may
have available to it to reduce costs, manage cash flows or raise additional
financing and assessed whether these were within the control of management and
possible in the period of assessment.
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 group's and parent company's
ability to continue as a going concern for a period of at least 12 months from
when the financial statements are authorised for issue.
In relation to the entities reporting on how they have applied the UK
Corporate Governance Code, we have nothing material to add or draw attention
to in relation to the directors' statement in the financial statements about
whether the director's considered it appropriate to adopt the going concern
basis of accounting.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Our approach to the audit
We tailored the scope of our audit to ensure that we performed enough work to
be able to give an opinion on the financial statements as a whole, taking into
account the structure of the Group, the accounting processes and controls, and
the industry in which the Group operates.
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF
ASSOCIATED BRITISH ENGINEERING PLC
The Group includes the listed parent Company (Associated British Engineering
PLC) and the main trading entity (British Polar Engines Limited) until its
disposal on 4 August 2020. The Group's accounting process is structured around
finance teams based in Cambridge and Glasgow, maintaining their own accounting
records and controls.
The main focus of our audit has been the parent company as explained above the
main trading subsidiary, British Polar Engines Limited, was disposed of during
the prior period.
Our application of materiality
We apply the concept of materiality both in planning and performing our audit,
and in evaluating the effect of misstatements on our audit and on the
financial statements. For the purposes of determining whether the financial
statements are free from material misstatement we define materiality as the
magnitude of misstatement that makes it probable that the economic decisions
of a reasonably knowledgeable person, relying on the financial statements,
would be changed or influenced.
We determined materiality for the Group to be £23,000, which is 2.5% of gross
assets. Gross assets is used as the benchmark for materiality as it is
considered the critical performance measure of the Group. We use a different
level of materiality, performance materiality, to drive the extent of our
testing and this was set at 83.33% of financial statement materiality for the
audit of the group financial statements.
We agreed with the Audit Committee that we would report to the Committee all
audit differences in excess of £750 as well as differences below that
threshold that, in our view, warranted reporting on qualitative grounds. We
also report to the Audit Committee on disclosure matters that we identified
when assessing the overall presentation of the financial statements.
Other information
The other information comprises the information included in the annual report
as set out on pages 1 to 54 other than the financial statements and our
auditor's report thereon. The Directors' are responsible for the other
information. 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 the other information we are required to
report on that fact.
As described in the basis for qualified opinion section of our report our
audit report is qualified in respect of the corresponding figures.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, the part of the directors' remuneration report to be audited
has been properly prepared in accordance with 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 those reports have been
prepared in accordance with applicable legal requirements;
· the information about internal control and risk management systems in
relation to financial reporting processes and about share capital structures,
given in compliance with rules 7.2.5 and 7.2.6 in the Disclosure Rules and
Transparency Rules sourcebook made by the Financial Conduct Authority (the FCA
Rules), is consistent with the financial statements and has been prepared in
accordance with applicable legal requirements; and
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF
ASSOCIATED BRITISH ENGINEERING PLC
· information about the company's corporate governance code and
practices and about its administrative, management and supervisory bodies and
their committees complies with rules 7.2.2, 7.2.3 and 7.2.7 of the FCA Rules.
Matters on which we are required to report by exception
Except for the matter described in the Basis for qualified opinion section of
our report, in the light of the knowledge and understanding of the group and
the parent 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; or
· the information about internal control and risk management systems in
relation to financial reporting processes and about share capital structures,
given in compliance with rules 7.2.5 and 7.2.6 of the FCA Rules.
Other than the matter described in the Basis for qualified opinion section 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 by the parent company,
or returns adequate for our audit have not been received from branches not
visited by us; or
· the parent company financial statements and the part of the
directors' remuneration report to be audited 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; or
· a corporate governance statement has not been prepared by the parent
company.
Corporate governance statement
We have reviewed the directors' statement in relation to going concern,
longer-term viability and that part of the Corporate Governance Statement
relating to the group's compliance with the provisions of the UK Corporate
Governance Statement specified for our review.
Based on the work undertaken as part of our audit, we have concluded that each
of the following elements of the Corporate Governance Statement is materially
consistent with the financial statements or our knowledge obtained during the
audit:
· Directors' statement with regards the appropriateness of adopting the
going concern basis of accounting and any material uncertainties identified
set out on page 49;
· Directors' explanation as to its assessment of the group's prospects,
the period this assessment covers and why the period is appropriate set out on
pages 49 and 50;
· Directors' statement on whether it has a reasonable expectation that
the group will be able to continue in operation and meet its liabilities set
out on pages 49 and 50;
· Directors' statement on fair, balanced and understandable set out on
page 49;
· Board's confirmation that it has carried out a robust assessment of
the emerging and principal risks set out on page 49;
· The section of the annual report that describes the review of
effectiveness of risk management and internal control systems set out on page
49; and
· The section describing the work of the audit committee set out on
page 47.
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF
ASSOCIATED BRITISH ENGINEERING PLC
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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 group's and the parent 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 group or the parent company or to cease operations, or have no
realistic alternative but to do so.
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 obtained an understanding of laws and regulations that affect the
group, focusing on those that had a direct effect on the financial statements
or that had a fundamental effect on its operations. Key laws and regulations
that we identified included the UK Companies Act, IFRS, Listing rules, tax
legislation and employment legislation.
· We enquired of the directors and reviewed ' meeting minutes for
evidence of non-compliance with relevant laws and regulations. We also
reviewed controls the directors have in place to ensure compliance.
· We gained an understanding of the controls that the directors have in
place to prevent and detect fraud. We enquired of the directors about any
incidences of fraud that had taken place during the accounting period.
· The risk of fraud and non-compliance with laws and regulations and
fraud was discussed within the audit team and tests were planned and performed
to address these risks. We identified the potential for fraud in the following
areas: revenue recognition, related parties outside normal course of business,
management override and misappropriation of cash and other assets.
· We reviewed financial statements disclosures and tested to supporting
documentation to assess compliance with relevant laws and regulations
discussed above.
· We enquired of the directors about actual and potential litigation
and claims.
· We performed analytical procedures to identify any unusual or
unexpected relationships that might indicate risks of material misstatement
due to fraud.
· In addressing the risk of fraud due to management override of
internal controls we tested the appropriateness of journal entries and
assessed whether the judgements made in making accounting estimates were
indicative of a potential bias.
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF
ASSOCIATED BRITISH ENGINEERING PLC
A further description of our responsibilities is available on the FRC's
website at:
https://www.frc.org.uk/auditors/audit-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor%E2%80%99s-responsibilities-for
(https://www.frc.org.uk/auditors/audit-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor%E2%80%99s-responsibilities-for)
This description forms part of our auditor's report.
Other matters which we are required to address
We were appointed by the directors on 29 January 2021 to audit the financial
statements for the period ending 30 September 2021. Our total uninterrupted
period of engagement is 2 years, covering the periods ending 30 September 2020
to date.
The non-audit services prohibited by the FRC's Ethical Standard were not
provided to the group or the parent company and we remain independent of the
group and the parent company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit
committee.
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.
Bright Grahame Murray
Matthew Eade
Senior Statutory Auditor
For and on behalf of Bright Grahame Murray
Emperor's Gate
114a Cromwell Road
Kensington
London
SW7 4AG
Date: 27 January 2022
ASSOCIATED BRITISH ENGINEERING PLC
GROUP AND PARENT COMPANY ACCOUNTING POLICIES
FOR THE YEAR ENDED 30 SEPTEMBER 2021
BASIS OF PREPARATION
The Company is a public limited company incorporated in the United Kingdom
under the Companies Act 2006. The address of the registered office is given on
the final page of this annual report.
The financial statements have been prepared on the going concern basis.
These Group consolidated accounts and the company accounts have been prepared
in accordance with International Financial Reporting Standards (IFRS) and with
those parts of the Companies Act 2006 applicable to companies reporting under
IFRS.
The Company's ordinary shares are listed on the London Stock Exchange (LSE)
under the ticker (ASBE) albeit that at the date of preparation share trading
was suspended. These financial statements are presented in pound sterling
because that is the currency of the primary economic environment in which the
Group operates and all values are rounded to the nearest thousand pounds
(£'000) except where otherwise indicated.
The Company's accounting reference date is 30 September. These financial
statements are for the year 1 October 2020 to 30 September 2021. The
comparative figures are for the period 1 April 2019 to 30 September 2020 (18
months).
NEWLY ISSUED ACCOUNTING STANDARDS
The following standards and amendments to existing standards became effective
from 1 January 2021 and are applicable for the current reporting period:
· Amendments to IAS 1, Presentation of Financial Statements. The
amendments clarify the basis used for the classification of current and
non-current liabilities.
· Amendments to IAS 8, Accounting policies, Changes in Accounting
Estimates and Errors. The amendments introduce the definition of an accounting
estimate and include other amendments to IAS 8 to distinguish changes in
accounting estimates from changes in accounting policies.
· Amendments to IAS 37, Provisions, Contingent Liabilities and
Contingent Assets. The amendments clarify the costs that should be included
when assessing whether a contract is onerous.
The adoption of the above new and revised standards had no impact on the
financial statements of the Group for the year ended 30 September 2021.
The following amendments to existing standards have been issued, but will
become effective for annual periods beginning on or after 1 January 2022.
· Amendments to IAS 1, Disclosure of Accounting policies.
Amendments to IAS 1 and the Materiality Practice Statement, to accounting
policies which require disclosure.
· Amendments to IAS 37, Onerous contracts (Cost of fulfilling a
contract). The amendments clarify the meaning of 'cost to fulfil a contract'.
· Amendments to IAS 12, Deferred Tax related to Assets and
Liabilities. The amendment narrowed the scope of the recognition exemption, so
that it no longer applies to transactions that, on initial recognition, give
rise to equal taxable and deductible temporary differences.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP AND PARENT COMPANY ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GOING CONCERN
The Company has sufficient financial resources. As a consequence, the
Directors believe the Company is well placed to manage its business risks
successfully, including the impact of Covid-19 and Brexit. The Directors
regularly review the forecasts.
In accordance with their responsibilities, the Directors of the Company have
considered the appropriateness of the going concern basis, which has been used
in the preparation of these financial statements. The Directors have prepared
trading and cash flow forecasts for the Company, which take into account the
future performance of the Company and consider the impact of the Covid-19
pandemic. The forecasts, including allowance for reasonable possible changes
in trading performance indicate that the Company should be able to operate for
at least 12 months from the approval of these financial statements. The
Strategic Report and Directors Report includes further disclosure on the
Covid-19 impact.
The forecasts for the 12 months from approval of these financial statements
have been considered. As a result of the above assessment, the Directors have
a reasonable expectation that the Company has adequate resources to continue
in operational existence for a minimum period of 12 months from the date of
signing these financial statements. Thus, they are adopting the going concern
basis in preparing the annual financial statements.
BASIS OF CONSOLIDATION
The consolidated accounts include the Company and its subsidiary undertaking
(from the date of acquisition or to the date of disposal where applicable).
Intra group sales and profits are eliminated on consolidation. The accounts of
the subsidiary undertaking are made up to 30 September 2021.
A subsidiary is an entity controlled, either directly or indirectly, by the
Company, where control is the power to govern the financial and operating
policies of the entity so as to obtain benefit from its activities. The
acquisition method of accounting is used to account for acquisition of
subsidiaries by the Group. The cost on an acquisition is measured as the fair
value of the assets given, equity instruments issued, and liabilities incurred
or assumed at the date of exchange. Acquisition costs are expensed in the
consolidated income statement for the period in which they are incurred.
The consolidated financial statements consist of the results of the following
entities:
Entity Summary
Description
Associated British Engineering Plc (ABE) Holding
Company
Akoris Trading Ltd (AT)
Trading Company
British Polar Engines Ltd (BPE)
Trading Company. Disposed of in previous
year. Please refer to note
9 on page 40.
REVENUE RECOGNITION
Revenue is measured at the fair value of the consideration receivable by the
Group for goods supplied and services provided, excluding value added tax and
trade discounts. Revenue from the sale of spare parts is recognised when the
goods are dispatched or, if under a bill and hold arrangement, when they are
available for despatch to a specific customer. Revenue from the sale of
engines is recognised in accordance with the performance of contractual terms
and specifically when the engines have been satisfactorily tested in
accordance with contractual terms. Revenue from servicing and repair work is
recognised when the work is completed.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP AND PARENT COMPANY ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
ACCOUNTING ESTIMATES AND JUDGEMENTS
Management are required, in accordance with IFRS, to exercise judgement and to
make estimates and assumptions regarding the application of accounting
policies and the resulting effect on reported amounts of assets, liabilities,
income and expenses. These estimates and assumptions are based on historical
experience and a review of current conditions prevailing at the time but
actual results may differ from these estimates. Any such revision is
recognised in the financial statements in the period in which the change in
circumstance is detected.
ACCOUNTING JUDGEMENTS
The key areas where management have exercised judgement in the period, and the
thought processes undertaken, are as follows:
DEFERRED TAX
Judgement is applied by management in determining the extent to which the
recovery of carried forward tax losses is probable for the purpose of meeting
the criteria for recognition as deferred tax assets. Note 18 sets out
information on carried forward tax losses for which a deferred tax asset has
not been recognised.
Accounting estimates
The key accounting estimates having an impact on carrying amounts of assets
and liabilities in the reporting period are as follows:
INVENTORIES
Inventories are stated at the lower of cost (including an appropriate
proportion of attributable supplier rebates and discounts) and net realisable
values.
Net realisable value is the estimated selling price in the ordinary course of
business, less applicable variable selling expenses. Provision is made for
obsolete or slow-moving inventories where appropriate.
INVENTORIES AND IMPAIRMENT OF INVENTORIES
Inventories of raw materials, work in progress and finished goods are valued
at the lower of cost and net realisable value. Work in progress and finished
goods include an appropriate allocation of overheads.
Cost is on a first in, first out basis. Net realisable value is the estimated
selling price in the normal course of business, less estimated costs of
completion and provision is made for obsolete, slow moving and defective
inventories.
PROVISION FOR DOUBTFUL DEBTS
At the balance sheet date, each subsidiary evaluates the recoverability of trade receivables and records provisions for doubtful or disputed debts based on experience including comparisons of the relative age of accounts and consideration of the history. The actual level of debt collected may differ from the estimated levels of recovery and could impact future operating results positively or negatively. As at 30 September 2021 the Group has provided £Nil (2020: £Nil) against its trade receivables.
LEASED ASSETS
Leases of property and plant and equipment, where the Group has substantially
all the risks and rewards of ownership, are classified as finance leases.
Assets held under finance leases are capitalised at lease inception at the
lower of the asset's fair value and the present value of the minimum lease
payments. Obligations related to finance leases, net of finance charges in
respect of future periods, are included as appropriate within borrowings. The
interest element of the finance cost is charged to the income statement over
the life of the lease so as to produce a constant periodic rate of interest on
the remaining balance of the liability for each period. The property, plant or
equipment is depreciated on the same basis as owned plant and equipment or
over the life of the lease, if shorter.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP AND PARENT COMPANY ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
LEASED ASSETS (Continued)
Leases where the lessor retains substantially all the risks and rewards of
ownership are classified as operating leases. Operating lease rentals (net of
any related lease incentives) are charged against profit on a straight line
basis over the period of the lease.
FOREIGN CURRENCIES
The functional and presentational currency of the parent company and its
subsidiaries is UK Pound Sterling, rounded to the nearest thousand.
Transactions in currencies other than the functional currency are translated
at the rate ruling at the date of the transaction. At each balance sheet date,
monetary assets and liabilities denominated in foreign currencies are
translated at the rate of exchange ruling at the balance sheet date. Any gains
or losses arising from the transactions are taken to the income statement.
PROPERTY, PLANT AND EQUIPMENT
Plant and equipment are stated at cost less depreciation and any impairment in
value. Depreciation is calculated to write down the cost of all plant and
equipment less its residual value by annual instalments over their expected
useful lives on the following bases:
Plant and machinery 7½- 33⅓ per cent
straight line
These useful lives and residual values are reviewed in each financial period.
Assets held under finance leases are depreciated over their expected useful
lives on the same basis as owned assets or where shorter, over the term of the
relevant lease. The gain or loss arising on the disposal or retirement of an
asset is determined as the difference between the sales proceeds and the
carrying amount of the asset and is recognised as income.
The carrying values of plant and machinery are reviewed for impairment when
events or changes in circumstances indicate the carrying value may not be
recoverable. If any such indication exists, and where the carrying values
exceed the estimated recoverable amount, the assets or cash generating units
are written down to their recoverable amounts.
TAXATION
The tax expense represents the sum of the tax currently payable and deferred
tax.
Current tax payable is based on the taxable profit or loss for the year.
Taxable profit differs from net profit as reported in the income statement
because it excludes items of income or expense that are taxable or deductible
in other periods and it further excludes items that are never taxable or
deductible. The Group's liability for current tax is calculated using tax
rates that have been enacted or substantively enacted by the balance sheet
date.
Deferred tax is provided in full, using the liability method, on temporary
differences arising between the tax bases of assets and liabilities and their
carrying amounts in the consolidated financial statements. The deferred tax is
not accounted for if it arises from initial recognition of an asset or
liability in a transaction, other than a business combination, that at the
time of the transaction affects neither accounting nor taxable profit nor
loss. Deferred tax is determined using tax rates (and laws) that have been
enacted or substantially enacted by the balance sheet date and are expected to
apply when the related deferred tax asset is realised or the deferred tax
liability is settled.
Deferred tax is provided on temporary differences arising on investments in
subsidiaries, except where the timing of reversal of the temporary differences
is controlled by the Group and it is probable that the temporary difference
will not reverse in the foreseeable future.
Deferred tax assets are recognised to the extent that it is probable that
future taxable profit will be available against which the temporary
differences can be utilised.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP AND PARENT COMPANY ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
CASH AND CASH EQUIVALENTS
Cash and cash equivalents in the Statement of Financial Position comprise cash
at bank and in hand and short term deposits with a maturity of three months or
less which are subject to an insignificant risk of changes in value.
FINANCIAL ASSETS
Financial assets are recognised initially at fair value, normally being the
transaction price. In the case of financial assets not at fair value through
profit or loss, directly attributable transaction costs are also included. The
subsequent measurement of financial assets depends on their classification.
The group derecognises financial assets when the contractual rights to the
cash flows expire or the financial asset is transferred to a third party. This
includes the de-recognition of receivables for which discounting arrangements
are entered into.
FINANCIAL INSTRUMENTS
Financial liabilities and equity instruments are classified according to the
substance of the contractual arrangements entered into.
Where the contractual obligations of financial instruments (including share
capital) are equivalent to a similar debt instrument, those financial
instruments are classed as financial liabilities. Financial liabilities are
presented as such in the balance sheet. Finance costs and gains or losses
relating to financial liabilities are included in the income statement.
Finance costs are calculated so as to produce a constant rate of charge on the
outstanding liability. Where none of the contractual terms of share capital
meet the definition of a financial liability then this is classed as an equity
instrument. Dividends and distributions relating to equity instruments are
debited direct to equity.
Further analysis of the Group's financial instruments, and the relevant
exposure to risks and uncertainties, is stated in note 17 and the various
classifications of financial assets and liabilities are identified and
explained.
Trade and other receivables
At the balance sheet date, the Company and its subsidiary evaluate the
recoverability of trade receivables and record provisions for doubtful or
disputed debts based on experience including comparisons of the relative age
of accounts and consideration of history. The actual level of debt collected
may differ from the estimated levels of recovery and could impact future
operating results positively or negatively.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, demand deposits, and other
short-term highly liquid investments that have maturities of three months or
less from inception, are readily convertible to a known amount of cash and are
subject to an insignificant risk of changes in value.
Trade and other payables
Trade and other payables are originally recognised at fair value, net of
transaction costs. Subsequent measurement is at amortised cost using the
effective interest rate method.
Investments in securities
Investments are recognised and derecognised on a trade date where a purchase
or sale of an investment is under a contract whose terms require delivery of
the investment within the timeframe established by the market concerned, and
are initially measured at fair value, with all transaction costs being written
off to the income statement as incurred.
Investments are classified as available for sale and are measured at
subsequent reporting dates at fair value. Gains and losses arising from
changes in fair value of available for sale financial assets are included in
other comprehensive income for the period. When the asset is disposed of or
deemed to be impaired, the cumulative gain or loss is reclassified from equity
reserve to income statement.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP AND PARENT COMPANY ACCOUNTING POLICIES (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT
At each balance sheet date the Group reviews the carrying amounts of its
property, plant and equipment to determine whether there is any indication
that those assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine
the extent of the impairment loss (if any). Where the asset does not generate
cash flows that are independent from other assets, the Group estimates the
recoverable amount of the cash-generating unit to which the asset
belongs.
Recoverable amount is the higher of fair value less costs to sell and value in
use. In assessing value in use the estimated future cash flows are
discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific
to the asset for which the estimates of future cash flows have not been
adjusted. If the recoverable amount of an asset (or cash-generating unit) is
estimated to be less than its carrying amount, the carrying amount of the
asset (cash-generating unit) is reduced to its recoverable amount. An
impairment loss is recognised as an expense immediately, unless the relevant
asset is carried at a revalued amount, in which case the impairment loss is
treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the
asset (cash-generating unit) is increased to the revised estimate of its
recoverable amount, but so that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss
been recognised for the asset (cash-generating unit) in prior periods.
SEGMENTAL REPORTING
The standard requires financial information to be disclosed in the financial
statements in the same format in which it is disclosed to the chief operating
decision-maker. The chief decision-maker has been identified as the Board, at
which level strategic decisions are made.
EQUITY AND RESERVES
Share capital represents the nominal value of shares that have been issued
except for the preference shares classified as debt. Deferred shares represent
shares arising from the sub-division of ordinary shares of £2.
Share premium includes any premiums received on issue of share capital. Any
transaction costs associated with the issuing of shares are deducted from
share premium, net of any related income tax benefits. Retained earnings
include all current and prior period retained profits and losses. Available
for sale reserve includes all gains and losses relating to Available for Sale
financial assets. Other reserves relate to movements not classified in any of
the reserves detailed above. Revaluation reserve includes all gains and losses
relating to Property, Plant and Equipment. All transactions with owners of the
parent are recorded separately within equity.
ASSOCIATED BRITISH ENGINEERING PLC
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2021
Year
Period
ended ended
30 Sep 30 Sept
Note 2021 2020
£'000 £'000
REVENUE 1 - 165
Operating costs 2 (88) (26)
OPERATING (LOSS)/PROFIT 3 (88) 139
Finance income 6 - 1
Other income 1 5
(LOSS)/PROFIT BEFORE TAXATION (87) 145
Taxation 7 - -
(LOSS)/PROFIT FOR THE YEAR FROM
CONTINUOUS OPERATIONS (87) 145
PROFIT ON DISPOSAL OF DISCONTINUED OPERATIONS (PAGE 9 - 5,239
41)
TOTAL (LOSS)/PROFIT FOR THE YEAR (87) 5,384
PROFIT/(LOSS) PER SHARE ON PROFIT/(LOSS) FOR THE YEAR
ATTRIBUTABLE TO EQUITY HOLDERS OF THE
PARENT COMPANY
BASIC AND DILUTED PROFIT FROM DISCONTINUED OPERATIONS - 256.0p
BASIC AND DILUTED (LOSS)/PROFIT 8 (4.25p) 263.0p
(Loss)/Profit for the year attributable to:
Owners of the Company (87) 5,384
Non-controlling interests - -
(87) 5,384
The accounting policies on pages 15 to 20 and the notes on pages 26 to 35 form
part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2021
Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
(Loss)/Profit in the year (87) 5,384
Other comprehensive income
Gain on available for sale financial assets
Unrealised gains (*) 236 327
Gains released to Retained Earnings 149 -
Other comprehensive profit in the year 385 327
TOTAL COMPREHENSIVE INCOME IN THE YEAR 298 5,711
Total comprehensive income attributable to:
Owners of the Company 298 5,711
Non-controlling interests - -
298 5,711
(*) = Items which may subsequently be reclassified to the Income Statement.
All activities are classified as continuing.
The accounting policies on pages 15 to 20 and the notes on pages 26 to 35 form
part of these accounts.
ASSOCIATED BRITISH ENGINEERING
PLC
Company Number: 00110663
GROUP STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2021
Note 2021 2020
£'000 £'000
ASSETS
Non-current assets
Available for sale financial assets 12 419 413
419 413
Current assets
Trade and other receivables 11 21 24
Cash and cash equivalents 489 186
510 210
Total assets 929 623
EQUITY AND LIABILITIES
Called up share capital 13 51 51
Deferred shares 13 2,594 2,594
Share premium account 5,370 5,370
Other reserves 11 11
Available for Sale reserve 360 270
Retained earnings (7,497) (7,705)
Equity attributable to the Parent Company's Equity shareholders 889
591
Total equity 889 591
LIABILITIES
Current liabilities
Trade and other payables 16 40 32
40 32
Total liabilities 40 32
Total equity and liabilities 929 623
The financial statements were approved and authorised for issue by the Board
of Directors on 27 January 2022 and were signed below on its behalf by:
C Weinberg
Director
The accounting policies on pages 15 to 20 and the notes on pages 26 to 35 form
part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
Attributa-ble to owners of the parent
Share capital Share premium Deferred Other reserve Available for Sale reserve Revaluation reserve Retained earnings
shares Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 April 2019 51 5,370 2,594 11 805 550 (13,089) (3,708) (3,708)
Profit for the period - - - - - - 145 145 145
Other comprehensive income
Disposal of subsidiary
- - - - (862) (550) 5,239 3,827 3,827
Unrealised gain on Available for Sale financial assets (*)
- - - - 327 - - 327 327
-------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
Balance at 1 October 2020 51 5,370 2,594 11 270 - (7,705) 591 591
-------------- -------------- --------------- -------------- -------------- -------------- --------------- --------------- ---------------
Loss for the year - - - - - - (87) (87) (87)
Other comprehensive income
Unrealised gain on Available for Sale financial assets (*)
- - - - 385 - - 385 385
Realised gain on
Available for Sale
financial assets
Fair value adjustments - - - - 55 - (55) - -
Realised gains - - - - (350) - 350 - -
-------------- -------------- --------------- -------------- -------------- -------------- --------------- --------------- ---------------
Balance at 30 September 2021 51 5,370 2,594 11 360 - (7,497) 889 889
====== ====== ====== ====== ====== ====== ======= ======= ======
(*) Items which may subsequently be reclassified to the Income Statement.
The accounting policies on pages 15 to 20 and the notes on pages 26 to 35 form
part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
GROUP CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2021
2021 2020
£'000 £'000
Cash flows from operating activities
Cash used in operations (77) 91
Net cash used in operating activities (77) 91
Cash flows from investing activities
Movements in investments - (65)
Sale proceeds from trading investments 380 -
Sale proceeds from subsidiary disposal - 100
Net cash increase from investing activities 380 35
Net increase in cash and cash equivalents 303 126
Cash decrease on disposal of subsidiary - (329)
Cash and cash equivalents at beginning of period 186 389
Cash and cash equivalents at end of period 489 186
CASH FLOW FROM OPERATING ACTIVITIES
2021 2020
£'000 £'000
(Loss)/profit from continuous operations (87) 145
Adjustments for changes in working capital:
Decrease/(increase) in trade and other receivables 3 (20)
Increase/(decrease) in payables 7 (34)
(77) 91
Cash used in operations (77) 91
The accounting policies on pages 15 to 20 and the notes on pages 26 to 35 form
part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP
FOR THE YEAR ENDED 30 SEPTEMBER 2021
1. SEGMENTAL REPORTING
All sales made in the prior period were within the United Kingdom and relate
to the rendering of services.
In the year ended 30 September 2021 save for dollar bank
accounts and overseas debtors, all of the
assets held by the Group were located in the United Kingdom
and all capital expenditure was incurred
within the United Kingdom.
Operating segments
The following segment information has been prepared in accordance with IFRS 8,
"Operating Segments", which defines requirements for the disclosure of
financial information of an entity's operating segments.
The Board consider the Group on an individual company basis. Reports by
individual companies are used by the chief decision-maker in the Group.
Significant operating segments are Associated British Engineering Plc and
Akoris Trading Limited.
The Group's operations are located in the United Kingdom. Any transactions
between business units are on normal commercial terms and conditions.
Akoris Trading Limited is a commodity and natural resource trading, finance
and investment company.
Associated British Engineering Plc is the Group's holding company.
Associated British Engineering Plc
Year ending 30 September 2021 Akoris Trading Limited
Consolidated
£'000 £'000 £'000
External sales - - -
Segment result (LBIT) (84) (3) (87)
Net finance expenses -
Taxation -
Loss after tax (87)
Balance sheet
Segment assets 900 29 929
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
1. SEGMENTAL REPORTING (continued)
Associated British Engineering Plc
Period ended 30 September 2020 British Polar Engines Limited Akoris Trading Limited
Consolidated
£'000 £'000 £'000 £'000
External sales 165 Unavailable - 165
Segment result PBIT/(LBIT) 146 Unavailable (1) 145
Net finance expenses -
Taxation -
Profit after tax 145
Other information
Capital additions - Unavailable - -
Balance sheet
Segment assets 591 Unavailable 32 623
British Polar Engines was sold on 4 August 2020, for further details please
see note 9 (page 41).
All of the revenue recognised by the Group during the prior
period arose from contracts from customers
as defined in IFRS 15.
2. OPERATING COSTS Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
Staff costs (note 4) 5 65
Other expenses 83 (39)
88 26
3. OPERATING (LOSS)/PROFIT Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
Operating (loss)/profit is stated after charging
Fees payable to the Company's auditor for the audit of the Company's annual
accounts:
PLC audit costs 9 9
The audit of the Company's subsidiaries pursuant to legislation 1 1
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
4. STAFF COSTS AND EMPLOYEES Year Period ended
ended 30 Sep
30 Sep
2021 2020
£'000 £'000
Wages and salaries 5 62
Social security costs - 3
5 65
The average monthly number of persons employed by the Group during the period
was:
Year Period
ended
ended
30 Sep
30 Sep
2021 2020
Number Number
By activity
Administration 3 3
3 3
5. DIRECTORS' REMUNERATION
Directors received emoluments of £1,050 (2020: £78,336).
Further details can be found on page 52.
Year Period
ended ended
30 Sep 30 Sep
2021 2020
KEY MANAGEMENT COMPENSATION
£'000 £'000
Remuneration of Group directors - 42
The Group made no pension contributions in respect of Group
directors during the year ended 30
September 2021.
6. INTEREST RECEIVED Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
Interest receivable on cash and cash equivalents - 1
- 1
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
7. TAXATION 30 Sep 30 Sep
2021 2020
£'000 £'000
The tax charge is set out below:
Current tax:
United Kingdom corporation tax at 19% (2020: 19%) - -
Total current tax and tax on profit on ordinary activities - -
The tax assessed for the period is different from the standard rate of
corporation tax in the UK of 19% (2020: 19%). The differences are explained as
follows:
30 Sep 30 Sep
2021 2020
£ ' 0 0 0 £'000
(Loss)/profit on ordinary activities before tax (87) 145
(Loss)/profit on ordinary activities multiplied by standard rate of
Corporation tax in the UK of 19% (2020: 19%)
(17) 28
Effects of:
Losses carried forward 17 -
Utilisation of tax losses - (28)
Taxation credit in the consolidated income statement - -
The Group has trading losses of approximately £1.5 million (2020: 1.4
million) and capital losses of £8.0
million (2020: £8.3 million). These are available to set against future
taxable profits, taxation liabilities and
capital gains respectively. The trading losses are available to be used
against future profits arising from
the same trade within the Group. These amounts are subject to agreement
with Her Majesty's Revenue
and Customs. Deferred tax assets have not been recognised in the Group
accounts. As the timing and
extent of taxable profits are uncertain, a deferred tax asset of £278k
(2020: £265k) arising on the trading
losses has not been recognised in the financial statements.
8. (LOSS)/PROFIT PER SHARE
The calculation of loss per ordinary share is based on the loss
attributable to ordinary shareholders
divided by the weighted average number of shares in issue during the
period.
2021 2020
Weighted Average number of shares Weighted Average number of shares
Per shares Per shares amount pence
amount
pence
Loss Profit
£'000 £'000
Basic and diluted (loss)/profit per share (87) 2,048,990 (4.25p) 5,384 2,048,990 263.0p
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
9. PROPERTY, PLANT AND EQUIPMENT Freehold
land and Plant and machinery
buildings Total
£'000 £'000 £'000
COST
At 1 April 2019 689 1,440 2,129
Additions - - -
Disposal of subsidiary (689) (1,438) (2,027)
At 30 September 2020 - 2 2
At 30 SEPTEMBER 2021 - 2 2
ACCUMULATED DEPRECIATION
At 1 April 2019 194 1,401 1,595
Charge for period 34 50 84
Eliminated on disposal of subsidiary (228) (1,449) (1,677)
At 30 September 2020 - 2 2
At 30 SEPTEMBER 2021 - 2 2
CARRYING AMOUNTS
At 30 SEPTEMBER 2021 - - -
At 30 September 2020 - - -
At 31 March 2019 495 39 534
10. CAPITAL COMMITMENTS
At 30 September 2021 the Group had capital commitments of
£Nil (2020: £Nil).
11. TRADE AND OTHER RECEIVABLES 2021 2020
£'000 £'000
Other receivables 21 21
Prepayments and accrued income - 3
21 24
Trade receivables disclosed above are classified as loans and
receivables and are measured at
amortised cost.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
11. TRADE AND OTHER RECEIVABLES (Continued)
Movement in the allowance for doubtful debts:
2021 2020
£'000 £'000
Balance at the beginning of the period - 834
Increase in provision - -
Disposal of subsidiary - 834
Balance at the end of the period - -
12. AVAILABLE FOR SALE INVESTMENTS 2021 2020
£'000 £'000
Listed Securities (quoted and unquoted) 419 413
£'000
Opening balance 413
Revaluations 385
Disposals (379)
Closing balance 419
Gains or losses on available for sale investments are
presented within other comprehensive income.
IFRS 13 requires that the fair value reflects "exit price" and is valued in
line with the relevant "unit of account" and the fair value of the equity
investments held is calculated by reference to the quoted market price at the
year end. Available for sale investments are valued based on active markets'
prices. As at 30 September 2021, the investments are reported under Level 1 in
the fair value hierarchy.
As described in prior financial statements the Group held an investment in
SalvaRx Group plc. During the previous period that entity disposed of its
interest in its subsidiary, SalvaRx Limited to Portage Biotech Inc.
Subsequently as part of a demerger, SalvaRx Group plc transferred 12,600,000
shares in Portage Biotech Inc, to the Group. As part of the sale of BPE in the
previous period, 40% of those shares and the shares in SalvaRx Group plc were
transferred to the Company.
13. CALLED UP SHARE CAPITAL 2021 2020
£'000 £'000
Nominal value:
Allotted and fully paid:
2,048,990 ordinary shares of £0.025 each 51 51
1,313,427 deferred shares of £1.975 each 2,594 2,594
2,645 2,645
Carrying value:
Equity shares:
2,048,990 ordinary shares of £0.025 each 51 51
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
13. CALLED UP SHARE CAPITAL (Continued)
The structure of the Group and Company's capital is as
follows:
Ordinary Ordinary Deferred Deferred Share
Shares Shares Shares Shares Premium
No. £'000 No. £'000 £'000
Balance at 30 September 2021 (£0.025/£1.9752 shares) 2,048,990 51 1,313,427 2,594 5,370
Further to the Extraordinary General Meeting held on 1
September 1999 the ordinary shares have 200
votes per share.
The deferred shares do not have voting rights and do not
carry any entitlement to attend general meetings
of the Company; they are not admitted to any Stock Exchange
and carry a right to participate in any return
of capital once an amount of £100 has been paid in respect
of each new ordinary share.
Capital management
The Group manages its capital to ensure that entities in
the Group will be able to continue as going
concerns while maximising the return to stakeholders
through the optimisation of the debt and equity
balance.
The capital structure of the Group consists of called up
share capital, deferred shares, share premium
account, other reserves and retained earnings. The Group is
not subject to any externally imposed capital
requirements.
14. NON-CONTROLLING INTERESTS
At the period-end, the Group held 99.7% of Akoris Trading Limited's Ordinary
Share capital.
15. RETIREMENT BENEFIT SCHEMES
The Group has, as a result of the disposal of British Polar Engines Ltd in the
prior period, no retirement defined benefit scheme.
16. PAYABLES 2021 2020
£'000 £'000
Current
Trade payables 1 2
Other payables 21 21
Accruals 18 9
40 32
All current payables are expected to mature within a
period of 6 months.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
17. FINANCIAL INSTRUMENTS
The fair value of financial assets and liabilities,
together with the carrying amounts shown in the Group
balance sheet, are as follows.
No financial assets or liabilities have been reclassified
during the period.
2021 2020
Loans and Fair value Loans and Fair value
Receivables Profit or loss receivables Profit or loss
£'000 £'000 £'000 £'000
Financial assets:
Trade and other receivables 21 - 24 -
Total current 21 - 24 -
Total 21 - 24 -
Trade and other payables 40 - 32 -
Loans - - - -
Total current 40 - 32 -
Total 40 - 32 -
Trade and other receivables exclude the value of any prepayments or accrued
income. Trade and other
payables exclude the value of deferred income. All financial assets and
liabilities have a carrying value
that approximates to fair value. For trade and other receivables, allowances
are made within the book
value for credit risk.
RISKS
The main risks arising from the Group's financial
instruments are market risk, liquidity risk and credit risk.
Market risk includes price commodity risk, foreign
exchange risk and interest rate risk. The Group has
an exposure to foreign exchange risk to the extent that
investments may be priced in US dollars or other
currencies and has no loans, therefore limited exposure
to interest rate risk.
Cash and cash equivalents held at floating rates expose
the entity to cash flow risk. Interest rate risk is
limited to the cash and cash equivalents.
Based on the balance sheet value of cash and cash
equivalents, a 1% change in interest base rates
would lead to an increase or decrease in income and
equity of £4,894 (2020 - £1,865).
The Board reviews and agrees policies for managing each
of the above risks and they are summarised
below and in the accounting policies to the Group
financial statements. These policies have been
consistently applied throughout the period.
COMMODITY PRICE RISK
The Group holds no stock and as such has no exposure to
commodities.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
17. FINANCIAL INSTRUMENTS (continued)
LIQUIDITY RISK
The Group's liquidity is dependent on the cash balances
available and it is the Group's policy to place
surplus cash on deposit to ensure it has an appropriate rate
of return. The Board reviews an annual 12
month financial projection as well as information regarding
cash balances.
CREDIT RISK
The Group's principal financial assets are cash deposits,
available for sale financial assets and trade and
other receivables. The credit risk associated with the cash
is limited as the counterparties have high credit
ratings assigned by international credit-rating agencies. The
principal credit risk arises therefore from its
trade and other receivables and available for sale financial
assets.
In order to manage credit risk the directors of the
subsidiary company set limits for customers based on a
combination of payment history, third party credit references
and knowledge of the customers. Credit limits
are reviewed by the subsidiary's directors on a regular basis
in conjunction with debt ageing and
experience. In 2019 there were a limited number of
concentrations of credit risk. In the prior year, the
Group had exposure to two large debtor balances at the period
end which accounted for almost a third of
the balance due between 61 and 120 days. There were no such
large debtors as at 30 September 2021.
Where appropriate, the subsidiary company requests payment or
part-payment in advance of shipment.
In connection with the trade receivables, there is a risk of
warranty claims, which the subsidiary company
tries to minimise. The carrying value of the trade
receivables represents the maximum credit risk exposure
and therefore sensitivity analysis has not been performed.
Collection procedures in relation to receivables are
initiated once the credit terms are exceeded and trade
receivables both due and not yet due are reviewed on a line
by line basis, with adequate provision being
made against period end balances where appropriate. During
the period an additional provision of £Nil
(2020: Nil) has been included in the financial statements.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The following table provides an analysis of financial
instruments that are measured subsequent to initial
recognition at fair value into Levels 1 to 3 based on the
degree to which the fair value is observable:
· Level 1 fair value measurements are those derived from quoted
prices in active markets for identical assets or liabilities;
· Level 2 fair value measurements are those derived from inputs
other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices); and
· Level 3 fair value measurements are those derived from valuation
techniques that include inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
Level 1 Level 2 Level 3 Total
£'000 £'000 £'000 £'000
Available for sale financial assets
Quoted and unquoted securities 419 - - 419
In the prior period, the fair value of financial instruments
was observed to be Level 1 (2020:£Nil). However,
during the current period this has subsequently changed given
that they are now held at a discount to the
quoted market price. The directors consider it appropriate to
apply a discount due to a lack of liquidity in
the markets.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - GROUP (continued)
FOR THE YEAR ENDED 30 SEPTEMBER 2021
18. DEFERRED TAXATION
The deferred taxation liability at 30 September 2021 was
£Nil (2020: £Nil).
No provision has been made for the potential deferred tax
assets on the trading losses carried forward
as they are not sufficiently certain to crystallise in the
foreseeable future. This assumption will be
revisited on an annual basis or as and when circumstances
change. The amounts not recognised, all of
which have been calculated at 19% (2020: 19%) are set out
below:
Group 2021 2020
£'000 £'000
Arising from trading losses 278 265
Arising from capital losses 1,520 1,577
1,798 1,842
19. CONTINGENT LIABILITIES
The Group had no contingent liabilities as at 30
September 2021 (2020: £Nil).
20. COMMITMENTS UNDER OPERATING LEASES
The Group had no commitments under non-cancellable
operating leases as at 30 September 2021
(2020:
£Nil).
21. SUBSIDIARIES
At 30 September 2021 the Company held share capital in
the following subsidiaries:
Company % Holding Activity Registered office Country of
Incorporation
Akoris Trading Limited 99.7% Commodity, natural resource finance, trading and investment 9 High Street England & Wales
Little Eversden
Cambridge
CB23 1HE
The investment in Akoris Trading Limited was fully
provided against at 30 September 2021 and 2020.
The investment in British Polar Engines Limited was
disposed of on 4 August 2020, as outlined in note
9 on page 41.
ASSOCIATED BRITISH ENGINEERING
PLC
Company Number: 00110663
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2021
2021 2020
Note £'000 £'000
ASSETS
Non-current assets
Available for sale financial assets 10 419 413
419 413
Current assets
Trade and other receivables 11 21 24
Cash and cash equivalents 460 154
481 178
T Total assets 900 591
EQUITY AND LIABILITIES
Called up share capital 15 51 51
Deferred shares 15 2,594 2,594
Share premium account 5,370 5,370
Other reserve 212 212
Available for sale reserve 360 270
Retained earnings (7,725) (7,936)
Total equity 862 561
LIABILITIES
Current liabilities
Trade and other payables 12 38 30
Total liabilities 38 30
Total equity and liabilities 900 591
Under section 408 of the Companies Act 2006, the company is exempt from the
requirements to present its own Income statement. The loss after tax for the
period was £84,452 (2020: £245,757 profit)
The financial statements were approved and authorised for issue by the Board
of Directors on 27 January 2022 and were signed below on its behalf by:
C Weinberg
Director
The accounting policies on pages 15 and 20 and the notes on pages 39 to 44
form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
Available for Sale Financial Assets
Share capital Share premium Deferred Other reserve Retained earnings Total
shares
£'000 £'000 £'000 £'000 £'000 £'000 £000
Balance at 1 April 2019 51 5,370 2,594 212 (57) (8,182) (12)
-------------- -------------- --------------- -------------- -------------- --------------- --------------
Profit for the period - - - - - 246 246
Other comprehensive income
Unrealised loss on Available for Sale financial assets (*)
- - - - 327 - 327
-------------- -------------- --------------- -------------- -------------- --------------- ---------------
Balance at 1 October 2020 51 5,370 2,594 212 270 (7,936) 561
-------------- -------------- --------------- -------------- -------------- --------------- --------------
Loss for the year - - - - - (84) (84)
Other comprehensive income
Unrealised gain on Available for Sale financial assets (*)
- - - - 385 - 385
Realised gain on Available for Sale financial assets
Fair value adjustments
Realised gains - - - - 55 (55) -
- - - - (350) 350 -
-------------- -------------- --------------- -------------- -------------- --------------- --------------
Balance at 30 September 2021 51 5,370 2,594 212 360 (7,725) 862
====== ====== ====== ====== ====== ======= =======
(*) Items which may subsequently be reclassified to the Income Statement.
The accounting policies on pages 15 and 20 and the notes on pages 39 to 44
form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
COMPANY CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2021
2021 2020
£'000 £'000
Cash flows from operating activities
Cash used in operations (74) 59
Net cash used in operating activities (74) 59
Cash flows from investing activities
New investments - (65)
Sale proceeds from trading investments 380 -
Sale proceeds from subsidiary disposal - 100
Net cash derived from investing activities 380 35
Cash flows from financing activities - -
Net cash used in financing activities - -
Net increase in cash and cash equivalents 306 94
Cash and cash equivalents at beginning of period 154 60
Cash and cash equivalents at end of period 460 154
CASH FLOW FROM OPERATING ACTIVITIES
2021 2020
£'000 £'000
(Loss)/profit before taxation (84) 246
Adjustments for:
Profit on disposal of subsidiary undertaking - (100)
Changes in working capital:
Decrease/(increase) in trade and other receivables 3 (19)
Increase/(decrease) in trade and other payables 7 (68)
Taxes paid - -
Cash used in operations (74) 59
The accounting policies on pages 15 and 20 and the notes on pages 39 to 44
form part of these accounts.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - COMPANY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
1. OPERATING COSTS AND OPERATING LOSS Year ended Period ended
30 Sep 30 Sep
Operating loss is stated after charging
2021 2020
£'000 £'000
Fees payable to the Company's auditor for the audit of the company's annual accounts
9 9
2. STAFF COSTS AND EMPLOYEES Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
Wages and salaries 5 62
Social security costs - 3
5 65
The average monthly number of persons employed by the
Company during the period was:
Year Period
ended ended
30 Sep 30 Sep
2021 2020
Number Number
By activity
Directors 2 2
Administration 1 1
3 3
3. DIRECTORS' REMUNERATION Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
Remuneration in respect of directors was as follows:
Remuneration - 42
4. KEY MANAGEMENT COMPENSATION Year Period
ended ended
30 Sep 30 Sep
2021 2020
£'000 £'000
Remuneration of Company directors - 42
The Company made no pension contributions in respect of Company directors
during the period ended 30 September 2021 or 30 September 2020.
5. TAXATION
There is no taxation liability at 30 September 2021 (30 September 2020: £Nil)
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - COMPANY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
6. PROPERTY, PLANT AND EQUIPMENT
Computer equipment
Total
£'000 £'000
COST
At 1 April 2019 2 2
At 30 September 2020 2 2
At 1 October 2020 2 2
At 30 September 2021 2 2
ACCUMULATED DEPRECIATION
At 1 April 2019 2 2
At 31 September 2020 2 2
At 1 October 2020 2 2
At 30 September 2021 2 2
CARRYING AMOUNTS
At 30 September 2021 - -
At 30 September 2020 - -
At 31 March 2019 - -
7. CAPITAL COMMITMENTS
At 30 September 2021 the Company has no capital commitments (30 September
2020: £Nil)
8. INVESTMENTS IN SUBSIDIARIES
Company % Holding Activity Registered office Country of
Incorporation
Akoris Trading Limited 99.7% Commodity, natural resource trading 9 High Street England & Wales
and investment
Little Eversden
Cambridge
CB23 1HE
The investment in Akoris Trading Limited was fully provided against at 30
September 2021 and 2020. The investment in British Polar Engines Limited was
disposed of on 4 August 2020, as outlined in note 9 on page 41.
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - COMPANY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
9. DISPOSAL OF SUBSIDIARY
The Board of Associated British Engineering Plc disposed of its loans and
shareholding in its subsidiary British Polar Engines Limited ("BPE") on the 4
August 2020. The Company completed the sale of all the ordinary share capital
in its Principal Trading subsidiary BPE for £1 and also assigned the balance
of its remaining debt due from BPE to its parent company, Associated British
Engineering Plc for £100,000. So as at 30 September 2020 the trade of BPE
including its pension fund's assets and liabilities, were no longer part of
the Group. The results of BPE for the period from 1 April 2019 to 4 August
2020 were uncertain and depended to a large extent on the trading conditions
in the later part of this period and on an assessment of the pension fund's
performance. Unfortunately this was also a period of considerable disruption
due to a) COVID19, b) our chief accountant of BPE having time off for personal
problems and c) uncertainty regarding the pension fund. Following the sale the
directors of the Company, despite strenuous efforts, have been denied access
to the accounting records of BPE to clarify the trading position for this
period to 4 August 2020. The Directors are of the opinion that the lack of
information on BPE does not materially affect the understanding of the balance
sheet at 30 September 2020 or the business of the Group for the year to period
to 30 September 2020.
At the disposal date of 4 August 2020, the total net liability
value of £5,139,275 consisted of:
Tangible
assets
£534,000
Available for sale investments
£714,000
Inventories
£165,000
Cash at
bank
£328,985
Other receivables
£119,504
Other payables
(£2,018,764)
Retirement benefit obligation
(£4,982,000)
£5,139,275
Group gain on disposal of subsidiary
Consideration received
£100,000
Net liability disposed of
(£5,139,275)
Gain on
disposal
£5,239,275
Loss from discontinued operations
-
Total gain from discontinued operations £5,239,275
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - COMPANY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
10. AVAILABLE FOR SALE INVESTMENTS 2021 2020
£'000 £'000
Listed securities 419 413
Available For Sale
financial assets
£
Opening balance 413
Net fair value gain 385
Disposals (379)
Closing balance 419
Gains or losses on available for sale investments are
presented within other comprehensive income.
IFRS 13 requires that the fair value reflects "exit price" and is valued in
line with the relevant "unit of account" and the fair value of the equity
investments held is calculated by reference to the quoted market price at the
period end.
Available for sale investments, which are valued based on active markets'
prices, are reported under Level 1 in the fair value hierarchy.
11. TRADE AND OTHER RECEIVABLES 2021 2020
£'000 £'000
Amounts falling due within one period
Trade and other receivables 21 21
Other taxation and social security receivables - 3
21 24
12. TRADE AND OTHER PAYABLES 2021 2020
£'000 £'000
Amounts falling due within one period
Trade and other payables 21 23
Accruals and deferred income 17 7
38 30
13. FINANCIAL INSTRUMENTS
The fair values of cash and cash equivalents, available for
sale financial assets, receivables and payables are assumed
to approximate to their carrying values.
The Company's financial instruments comprise cash and various items, such as
trade and other receivables, available for sale financial assets and trade and
other payables that arise directly from its operations. The main purpose of
these financial instruments is to finance the Company's operations. At 30
September 2021 the Company has cash balances of £459,604 (2020: £153,840)
and no bank overdraft (2020: £Nil).
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - COMPANY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
13. FINANCIAL INSTRUMENTS (continued)
RISKS
The main risks arising from the Company's financial
instruments are market risk, liquidity risk and credit
risk. Market risk includes foreign exchange risk and
interest rate risk. The Company has limited exposure
to foreign exchange risk and also has no loans, therefore
limited exposure to interest rate risk.
Cash and cash equivalents held at floating rates expose the
entity to cash flow risk. Interest rate risk is
limited to the cash and cash equivalents.
Based on the balance sheet value of cash and cash
equivalents, a 1% change in interest base rates
would lead to an increase or decrease in income and equity
of £4,596 (2020: £1,539).
The Board reviews and agrees policies for managing each of
the above risks and they are summarised
overleaf and in the accounting policies to the Company
financial statements. These policies have been
consistently applied throughout the period.
LIQUIDITY RISK
The Company's liquidity is dependent on the cash balances
available and it is the Company's policy to
place surplus cash on deposit to ensure as high a rate of
return as possible. The Board reviews an annual
12 month financial projection as well as information
regarding cash balances on a monthly basis.
CREDIT RISK
The Company's principal financial assets are cash deposits,
available for sale financial assets and trade
and other receivables. The credit risk associated with the
cash is limited as the counterparties have high
credit ratings assigned by international credit-rating
agencies. The credit risk arising from its trade and
other receivables is negligible.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The following table provides an analysis of financial
instruments that are measured subsequent to initial
recognition at fair value into Levels 1 to 3 based on the
degree to which the fair value is observable:
· Level 1 fair value measurements are those derived from quoted
prices in active markets for identical assets or liabilities;
· Level 2 fair value measurements are those derived from inputs
other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices); and
· Level 3 fair value measurements are those derived from valuation
techniques that include inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
Level 1 Level 2 Level 3 Total
£'000 £'000 £'000 £'000
Available for sale financial assets
Quoted and unquoted securities (2021) 419 - - 419
Available for sale financial assets
Quoted securities (2020) 413 - - 413
ASSOCIATED BRITISH ENGINEERING PLC
NOTES TO THE ACCOUNTS - COMPANY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
14. DEFERRED TAXATION
2021 2020
£'000 £'000
Arising from trading losses 278 265
Arising from capital losses 1,520 1,577
1,798 1,842
The trading losses are available to be used against
future profits.
Deferred tax assets on the trading losses have not been
provided in the financial statements as they are
not sufficiently certain to crystallise in the
foreseeable future. The amounts not recognised are set out
above.
15. CALLED UP SHARE CAPITAL 2021 2020
£'000 £'000
Nominal value:
Allotted and fully paid:
2,048,990 ordinary shares of £0.025 each 51 51
1,313,427 deferred shares of £1.975 each share premium 2,594 2,594
2,645 2,645
Carrying value:
Equity shares:
2,048,990 ordinary shares of £0.025 each 51 51
Further to the Extraordinary General Meeting held on 1 September 1999 the
ordinary shares have 200 votes per share.
The deferred shares do not have voting rights and do not carry any entitlement
to attend general meetings of the Company; they are not admitted to any Stock
Exchange and carry a right to participate in any return of capital once an
amount of £100 has been paid in respect of each new ordinary share.
16. CONTINGENT LIABILITIES
There were no contingent liabilities at 30 September
2021.
17. RELATED PARTY TRANSACTIONS
The Company has taken advantage of the exemption with
regard to disclosing transactions with wholly-owned subsidiaries, on the
grounds that the results of the subsidiaries are included in the publicly
available consolidated financial statements of Associated British Engineering
Plc.
ASSOCIATED BRITISH ENGINEERING PLC
STATEMENT OF DIRECTORS' RESPONSIBILITIES
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the
Directors' Report, the Remuneration 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 are required to prepare financial
statements in accordance with International Financial Reporting Standards, as
adopted by the European Union (IFRSs) and have also been chosen to prepare the
parent company financial statements under IFRS as adopted by the European
Union. 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 Group and Company and profit or loss of the Group
for that year. 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
· state whether applicable accounting standards, IFRS as adopted by
the European Union 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
· prepare a directors' reports, strategic report and directors'
remuneration report which comply with the requirements of the Companies Act
2006.
The directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Group's and Company's transactions and
disclose with reasonable accuracy at any time the financial position of the
Company and the Group and enable them to ensure that the financial statements
and the directors remuneration report comply with the Companies Act 2006 and
Article 4 of the IAS Regulations. They are also responsible for safeguarding
the assets of the Company and the Group and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
The directors confirm that:
· so far as each director is aware, there is no relevant audit
information of which the Group's auditor is unaware; and
· the directors have taken all steps that they ought to have taken
to make themselves aware of any relevant audit information and to establish
that the auditor is aware of that information.
· the directors are responsible for preparing the annual report in
accordance with applicable law and regulations. The directors consider the
annual report and the financial statements, taken as a whole, provides the
information necessary to assess the company's performance, business model and
strategy and is fair, balanced and understandable
WEBSITE PUBLICATION
The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in the United Kingdom governing the preparation and dissemination
of financial statements may differ from legislation in other jurisdictions.
DIRECTORS' RESPONSIBILITIES PURSUANT TO DTR4
To the best of their knowledge, the directors confirm:
· the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view of the
assets, liabilities, financial position of the Group and Company and profit or
loss of the Group as at 30 September 2021; and
· the annual report, including the Strategic Report includes a
fair review of the development and performance of the business and the
position of the Group and Company, together with a description of the
principal risks and uncertainties faced.
C Weinberg
Director
Date: 27 January 2022
ASSOCIATED BRITISH ENGINEERING PLC
CORPORATE GOVERNANCE REPORT
(AS REFERRED TO IN THE DIRECTORS' REPORT)
In accordance with the requirements of the Listing Rules of the Financial
Conduct Authority, set out below are details of the Company's corporate
governance arrangements, including a statement as to how the Company applies
the main principles of the UK Corporate Governance Code ("the Code"), together
with a statement regarding its compliance with specific provisions. The Code
is publicly available on the Financial Reporting Council's website
www.frc.org.uk (http://www.frc.org.uk) . Whilst welcoming the principles
contained within the Code, the Board considers that it should be recognised
that what may be appropriate for a large Company may not necessarily be so
appropriate for a smaller company and the Company's current circumstances. As
a result, the Company has been in compliance throughout the period with the
provisions set out in the UK Corporate Governance Code with the following
exceptions:-
· The division of responsibilities between the roles of chairman
and chief executive have not been clearly established, set out in writing and
agreed by the Board. This is contrary to provision A.2.1. This has not been
put in place because there is no chief executive on the Board but the
appointment of joint-chairmen provides checks and balances;
· The Company does not have a Nomination Committee, this is
contrary to provisions B2.1-B2.2 and B2.4. This has not been considered
necessary due to the size and nature of the Board which consists of two part
time executive directors;
· The non-executive director of the Company has not been appointed
for specific terms as required by provision B2.3. This has not been
considered necessary as the sole incumbent resigned and a new non-executive
director has not been appointed;
· There is no formal training programme for new directors on
joining the Board. This is contrary to provision B4.2. This has not been
considered necessary to date but will be actively considered by the Board for
new appointments;
· The Board has not undertaken a formal and rigorous annual
evaluation of its own performance and the individual directors. This is
contrary to provision B.6.1. When a new non-executive director is appointed
this will be implemented.
· The Board has not appointed independent non-executive directors
as required by B1.2, C.3.1, A4 and D2.1. The Board is actively pursuing
suitable candidates for the position(s).
Board of Directors
The Board comprises two part time executive directors, as detailed in the
Directors' Report.
The Board of Directors is responsible for formulating strategy and monitoring
financial performance. The directors are in frequent contact throughout the
period with the Group's management, meet as required and also attend formal
Board meetings. The strategies proposed by management of the company and its
subsidiaries are fully discussed, critically examined against the best and
long term interests of not only the shareholders, but also customers,
employees, suppliers and various communities and environments within which the
Company operates. During the period, all serving directors were in attendance
at Board meetings.
The Board retains full responsibility for the direction and control of the
Group and has a formal schedule of matters in respect of which decisions are
reserved to it, covering key areas including strategy formulation,
acquisitions or disposals, approval of the budget for the subsidiary,
financial results, board appointments and proposals for dividend payments.
The Board has full and timely access to relevant information throughout the
Group.
All directors have access to the advice and services of the Company Secretary,
who is responsible to the Board for ensuring that Board procedures are
complied with. There is also formal agreed procedure for directors in the
furtherance of their duties to take independent professional advice as
necessary at the Group's expense.
The business address of each of the directors is 9 High Street, Little
Eversden, Cambridge CB23 1HE.
ASSOCIATED BRITISH ENGINEERING PLC
CORPORATE GOVERNANCE REPORT (continued)
(AS REFERRED TO IN THE DIRECTORS' REPORT)
The board is supported by Peter Morton the ABE Office Administrator.
The Current Directors
Rupert Pearce Gould
Colin Weinberg
Short biographies of the directors appear on page 54 and show considerable and
varied experience in the business world and the City.
Under the Company's Articles of Association, new directors and at least one
third of the directors retire from office each period. The retiring director
is eligible for re-election.
At the year end, there were no independent non-executive directors. The
directors continue to search for a suitable candidate for the role and intend
to appoint a non- executive director in the near future.
Nominations Committee
The appointment of directors will be discussed by the full Board until such
time as there are two non-executive directors to form an effective committee.
Potential new non-executive directors are proposed by all the members of the
Board and major shareholders; the Board considers these in the light of the
Company's business requirements and the need to have a balanced Board. The
Board will then implement an appropriate review committee.
Audit Committee
The Company's audit committee comprises the full Board. The audit committee
meets at least twice a year to monitor the financial reporting process,
including its annual and interim accounts; the effectiveness of the Company's
internal controls and risk management systems; statutory audit of the annual
accounts; and to review and monitor the independence of the statutory auditor
and provision of additional services to the Company.
There is no internal audit function. Due to the size of the finance function
and the close involvement of directors, the Board and the Audit Committee do
not consider there to be a need for a separate internal audit function.
As part of this process, the performance of the Group's major division is
considered, with key judgements, estimates and accounting policies being
approved by the subsidiary Board ahead of recommendation to the Group board.
The primary areas of financial reporting judgement considered by the Committee
in relation to the 2021 financial statements and how they were addressed are
outlined below:
Going concern
The committee considered the use of the going concern basis following the
disposal of BPE. The audit committee has considered and approves of the
changes in the company's policy of reducing the forecast period of the
business insofar as it has exempted management from producing three-period
projections. This will be reviewed annually.
Revenue Recognition and Management Override
The Committee have reviewed the systems and control processes in place during
the financial year to 30 September 2021 and concluded that, given the
resources available, appropriate procedures are in place. There is sufficient
level of supervisory oversight in place to ensure that revenue is not
materially misstated and the risk of management override has been reduced.
Recoverability of receivables
The Committee have reviewed the policy for providing for doubtful debts and
believe them to be both robust and adequate.
ASSOCIATED BRITISH ENGINEERING PLC
CORPORATE GOVERNANCE REPORT (continued)
(AS REFERRED TO IN THE DIRECTORS' REPORT)
Reappointing the auditor
The auditor, Bright Grahame Murray, is deemed to be reappointed under section
487(2) of the Companies Act 2006.
Safeguards on non-audit services
Bright Grahame Murray do not provide any prohibited non-audit services. In
accordance with section 485 of the Companies Act 2006, a resolution proposing
that they be re-appointed will be put at a General Meeting.
Assessing external audit effectiveness
The Audit Committee reviews audit quality every year using feedback from the
Auditors and Senior Management Team. The effectiveness and quality of the
audit process is considered by focussing on the scope of the audit and auditor
independence in order to ensure that the quality of the audit process is not
compromised and remains effective.
The Board consider the independence and objectivity of the external auditor on
an annual basis, with particular regard to non-audit services. There were no
prohibited non-audit fees incurred from the auditor during the period. The
Board also receive an annual confirmation of independence from the auditors.
The committee has overseen the preparation of the viability statement and has
conducted a robust examination of the risks identified, the resulting actions
that may be required and the project outcomes.
Remuneration
The Company's remuneration committee comprises Rupert Pearce Gould and Colin
Weinberg. The remuneration committee is to meet at least twice a year and has
as its remit the determination and review of, amongst others, the remuneration
of directors including company directors together with any incentive plans
adopted, or to be adopted, by the Company and the Group.
Communication with Shareholders
The Board believes it is important to respond adequately to the queries of
both private and institutional shareholders. The Chairman's Statement in the
Annual Report contains a business review. An interim business review is also
provided with the half-period announcement. The Chairmen are available to
shareholders at any time to discuss strategy and governance matters.
AUDIT AND INTERNAL CONTROL
The Board seeks to ensure that its report and accounts and other financial
statements provide a clear assessment of the Group's business. All
shareholders have the opportunity to ask questions and express their views at
the Company's Annual General Meeting, at which all directors are available to
take questions.
The directors are responsible for the Group's system of internal control and
reviewing its effectiveness and the processes in place for risk management.
These controls can only ever provide reasonable but not absolute assurance
that assets are safeguarded against material misstatement or loss, that proper
accounting records are maintained, and that the information used internally,
or for publication, is accurate and reliable. The key procedures, which
existed to provide external control, are as follows:
- A regular review is undertaken to assess the risks facing the
trading subsidiary and to enhance the systems which manage the risk
identified. Management establishes control procedures for each of the risks
identified and reports whether the key controls have operated effectively
- Agreement of Group short term financial objectives
and business plans
- Review by the Board of monthly Group Financial Statements
and monitoring of results against budget. The executive directors attend
regular Board meetings of the subsidiary
ASSOCIATED BRITISH ENGINEERING PLC
CORPORATE GOVERNANCE REPORT (continued)
(AS REFERRED TO IN THE DIRECTORS' REPORT)
AUDIT AND INTERNAL CONTROL (continued)
- The acquisition or disposal of a business may not be
completed without the approval of the Board.
- The operational responsibility for preparing the
consolidated accounts is delegated to a third party service provider with the
Board retaining responsibility for overall content, presentation and final
review of the consolidated accounts.
- Clearly defined organisation structures with segregation of
duties wherever practicable. Operating and financial responsibilities for the
subsidiary Companies are delegated to the subsidiary Board and there are
limits which apply to capital expenditure and significant contracts.
- The executive directors attend regular Board
meetings of the subsidiary
- Board control over treasury, taxation, legal,
insurance and personnel issues
- The acquisition or disposal of a business may not
be completed without the approval of the Board.
- The operational responsibility for preparing the
consolidated accounts is delegated to a third party service provider with the
Board retaining responsibility for overall content, presentation and final
review of the consolidated accounts.
Risk Management
The Board confirms that there is an ongoing process for identifying,
evaluating and managing significant business risks faced by the Group,
including those risks relating to social, environmental and ethical matters.
This process was in place throughout the period under review and up to the
date of approval of this report. The Audit Committee has kept under review the
effectiveness of the system of internal control and has reported regularly to
the Board.
Through these mechanisms, Group performance is continually monitored, risks
identified in a timely manner via a robust risk assessment, their financial
implication assessed, control procedure re-evaluated and corrective actions
agreed and where possible implemented
The Board believes that it is not currently appropriate for the Group to
maintain an internal audit function due to the size of the Group and the
manner in which the Group operates.
Fair, Balanced and Understandable
We consistently seek to improve the process of compiling the Annual Report to
give the Board more time to assess whether it was fair, balanced and
understandable, as required by the Code. The Board considered whether the
Annual Report contained the necessary information for shareholders to assess
the Group's performance, business model and strategy. The tone was reviewed to
ensure a balanced approach and, with the support of the Audit Committee, the
Board made sure the narrative at the front end of the report was consistent
with the financial statements.
VIABILITY STATEMENT
In accordance with provision C2.2 of the UK Corporate Governance Code,
published by the Financial Reporting Council ("FRC") in September 2015, the
directors have assessed the viability of the Group over the immediate and
foreseeable future and in consideration of its sales and marketing
projections. This assessment has been made taking account of the current
position of the Group, the present immediate plan, the corporate planning
process, a budget for the operating company and the Group's principal risks
associated with the current plan.
The provision C2.2 of the UK Corporate Governance Code and Appendix B of the
FRC Guidance state that the period covered for longer term viability statement
should be significantly longer than 12 months from approval of the financial
statements as set out in the basis of preparation in the account policies of
these financial statements.
ASSOCIATED BRITISH ENGINEERING PLC
CORPORATE GOVERNANCE REPORT (continued)
(AS REFERRED TO IN THE DIRECTORS' REPORT)
VIABILITY STATEMENT (continued)
In assessing the prospects of the Group, the directors noted that such
assessment is subject to a degree of uncertainty that can be expected to
increase looking out over time and, accordingly, that future outcomes cannot
be guaranteed or predicted with certainty. The Board have concluded that, at
the time of theses financial statements being signed, there is adequate
visibility of the 12 months ahead for these financial statements to be
prepared on the going concern basis.
On behalf of the Board
C Weinberg
Director
Date: 27 January 2022
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS' REMUNERATION REPORT
Introduction
This report is submitted in accordance with Schedule 8 of the Large and Medium
sized Companies (accounts and Reports) (Amendment) Regulations 2014 in respect
of the year ended 30 September 2021. The reporting requirements entail two
sections to be included, a Policy Report and an Annual Remuneration Report
which are presented below.
The Company's auditor, Bright Grahame Murray, is required to give its opinion
on certain information included in this report, this comprises of the
Directors Remuneration - single figure table on page 51 and the information on
directors shareholdings which is contained in the directors' report on page 4
and also forms part of this directors' remuneration report. Their report on
these and other matters is set out on pages 3 to 5.
Consideration by the Directors of Matters Relating to Directors' Remuneration
The Company's Remuneration Committee considers Directors' remuneration and has
not sought advice or services from any person in respect of its consideration
of Directors' remuneration during the year although the Directors expect from
time to time to review the fees against those paid to boards of directors of
comparable organisations and appointments. The Company does not have a Chief
Executive Officer, Senior Management or any full time employees and relies on
senior management in each subsidiary.
DIRECTORS' REMUNERATION POLICY REPORT
The roles of the directors are as follows:-
Joint Chairman and Deputy Chairman - Rupert Pearce Gould (part time executive
- operational)
Joint Chairman and Deputy Chairman - Colin Weinberg (part time executive -
finance)
The Company's policy is for the Directors to be remunerated in the form of
fees, payable monthly in arrears. The directors each receive a fee for their
services, which is agreed by the Remuneration Committee after reviewing
comparable organisations and appointments. None of the directors receive a
pension or other benefit from the Company, nor do they participate in any
bonus or incentive schemes or share option schemes.
The fees are not specifically related to the Directors' performance, either
individually or collectively. The Board is also entitled to be repaid all
reasonable travelling subsistence and other expenses incurred by them
respectively whilst conducting their duties as Directors, however no other
remuneration or compensation was paid or payable by the company during the
period to any of the current Directors. There will be no payment for loss of
office unless approved by a separate shareholder resolution.
Major decisions on Remuneration
The Company's policy is that the fees payable to each director should reflect
the time spent by the directors on the Company's affairs and the
responsibilities borne by each of the directors. They should be sufficient to
attract candidates of high calibre to be recruited. The policy is for the
Chairmen of the Board to be paid higher fees than the other directors in
recognition of the more onerous role. The Remuneration policy is to review the
director's fee rates from time to time, benchmarking the fees against
comparable organisations and appointments, although such review will not
necessarily result in any change. Due to the nature of the Company, there
are no full time employees and therefore the requirement to consider the
percentage change in remuneration of all employees when determining the
Directors' remuneration is not considered to be relevant.
The directors have agreements with the company that may be terminated on one
year's notice. In accordance with the Articles of Association each director
retires from office at the third annual general meeting after the annual
general meeting at which he was last elected. A retiring director is
eligible for re-election.
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS' REMUNERATION REPORT (Continued)
A Director may resign by notice in writing to the Board at any time giving one
month's notice. None of the Directors are entitled to compensation payable
upon early termination of their arrangements other than in respect of any
unexpired notice period.
In accordance with the reporting requirements of Large and Medium sized
Companies (accounts and Reports) (Amendment) Regulations 2014, an Ordinary
resolution for the approval of the remuneration policy of the Company to
remain in force for a three-period period, was put to the members of the
Annual General Meeting and was effective from that date.
DIRECTORS'REMUNERATION - SINGLE FIGURE TABLE (AUDITED) 30 Sep 30 Sep
2021 2020
Total Total
£'000 £'000
Mr R Pearce Gould - 14
Mr C Weinberg - 28
- 42
The amounts above all relate to directors fees and represent the total
remuneration of the company's directors but excludes fees of £1,050 for
secretarial services (2020: £Nil) paid by the Group to Cambridge Corporate
Consultants Limited, a company in which Mr Pearce Gould is a director and has
a beneficial interest.
This section of the report is subject to approval by a simple majority of
shareholders at the AGM in 2021, as in previous periods.
Statement of Voting at the Annual General Meeting (AGM)
The 2020 Remuneration Report was presented to the AGM in September 2020 and
received shareholder approval following a vote on a show of hands. 1.1% of the
votes cast on the proxy forms were against the Report and no votes were
withheld. The proxy forms returned contained no explanation for the votes
against the resolution.
Total Shareholder Return (TSR)
Source: Yahoo UK finance
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS' REMUNERATION REPORT
The graph on page 51 shows the Company's TSR performance compared to the FTSE
All Share index over the past ten periods. TSR is defined as share price
growth plus reinvested dividends. This provides a basis for comparison with a
relevant equity index but should be treated with caution in view of the small
market in the Company's shares and the fact that the ordinary shares were
suspended for the financial year of these accounts.
A statement of directors' shareholdings and interest is reported in the
directors' report on page 4.
Company Performance
The Board is responsible for the Company's business strategy and performance.
The Statement of Directors' responsibilities, Corporate Governance report and
the Directors' Remuneration report on pages 45 to 53 form part of the
Directors' report.
On behalf of the Board
C Weinberg
Director
Date : 27 January 2022
ASSOCIATED BRITISH ENGINEERING PLC
DIRECTORS, REGISTERED OFFICE AND ADVISERS
The Board comprises two directors:
COLIN WEINBERG (71) became a non-executive director on 10 November 2003. He
was a member of the London Stock Exchange from 1980 to 1987 and was admitted
to fellowship of the Securities Institute in 1995. He was previously a
non-executive director of Peckham Building Society.
RUPERT PEARCE GOULD (70) was appointed as non-executive director on 18
September 2016. Rupert has a degree in engineering and has served as an
executive director and chairman in both the public and private sector. He was
chairman of BPE from 2000 to 2020.
SECRETARY BANKERS
The Royal Bank of Scotland plc
Mr R A Pearce Gould
Glasgow Cardonald B Branch
61-65 Church Street
2139 Paisley Road West
Harston
Glasgow
Cambridge
G52 3JW
CB22 7NP
Registered No.110663
rpg@cmc-group.co.uk
AUDITOR CORPORATE ADVISERS
Bright Grahame Murray Beaumont Cornish Limited
Emperor's Gate 2nd Floor
114a Cromwell Road Bowman House
Kensington 29 Wilson Street
London London
SW7 6AG EC2M 2SJ
REGISTRARS SOLICITORS
Computershare Investor Services plc Harrison Clark Rickerbys Limited
The Pavilions Compass House
Bridgwater Road Chivers Way, Histon
Bristol Cambridge
BS13 8AE CB24 9AD
REGISTERED OFFICE
9 High Street
Little Eversden
Cambridge
CB23 1HE
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