COMPANY REGISTRATION NUMBER 3294807
NETWORK SOLUTIONS (NORTHERN) LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31st JANUARY 1999
ASHFORD READ
Chartered Accountants & Registered Auditors
40 Alexandra Road
Freemantle
Southampton
Hampshire
SO15 5DG
NETWORK SOLUTIONS (NORTHERN) LIMITED
FINANCIAL STATEMENTS
YEAR ENDED 31st JANUARY 1999
CONTENTS PAGES
Officers and professional advisers 1
The directors' report 2 to 3
Auditors' report to the shareholders 4
Profit and loss account 5
Balance sheet 6
Notes to the financial statements 7 to 10
THE FOLLOWING PAGES DO NOT FORM PART OF THE STATUTORY FINANCIAL STATEMENTS
Detailed profit and loss account 12
Notes to the detailed profit and loss account 13
NETWORK SOLUTIONS (NORTHERN) LIMITED
OFFICERS AND PROFESSIONAL ADVISERS
THE BOARD OF DIRECTORS Mr A.P. Cowler
Mr W. Bridgen
Mr S. Sutton
COMPANY SECRETARY Mr A.P. Cowler
REGISTERED OFFICE 12 Acorn Business Centre
Northarbour Road
Cosham
Portsmouth
Hampshire
PO6 3TH
AUDITORS Ashford Read
Chartered Accountants
& Registered Auditors
40 Alexandra Road
Freemantle
Southampton
Hampshire
SO15 5DG
BANKERS Barclays Bank Plc
Soho Square Business Centre
8-9 Hanover Square
London
W1A 4ZW
SOLICITORS Gurney-Champion & Co
12 Edinburgh Road
Portsmouth
Hampshire
PO1 1DJ
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NETWORK SOLUTIONS (NORTHERN) LIMITED
THE DIRECTORS' REPORT
YEAR ENDED 31st JANUARY 1999
The directors present their report and the financial statements of the
company for the year ended 31st January 1999.
PRINCIPAL ACTIVITIES
The principal activity of the company during the year was computer network
installations.
THE DIRECTORS AND THEIR INTERESTS IN SHARES OF THE COMPANY
The directors who served the company during the year were as follows:
Mr A.P. Cowler
Mr W. Bridgen
Mr S. Sutton
Mr J.C. Beckett (Appointed 2 Jun 98)
Mr I.C. Cocks (Retired 2 Jun 98)
The company is a wholly owned subsidiary and the interests of group directors
are disclosed in the accounts of the parent company.
Mr J. C. Beckett resigned as a director of Network Solutions Group Limited,
Network Solutions Limited and Network Solutions (Northern) Limited on 9th July
1999.
YEAR 2000 ISSUES
The directors have considered the risks and uncertainties associated with the
year 2000 problem. During the year the company has taken steps to ensure that
its internal computer systems are millennium compliant.
The directors have also assessed the possibility of year 2000 related
failures in significant suppliers, all of whom have indicated that they are
already dealing with the problem. Whilst it is impossible to guarantee that
no year 2000 problems will remain, the directors are confident that the
company will be able to deal promptly with any failures that may occur.
DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company at the end of the year and of the profit or loss for the year then
ended.
In preparing those financial statements, the directors are required to select
suitable accounting policies, as described on page 7, and then apply them on
a consistent basis, making judgements and estimates that are prudent and
reasonable. The directors must also prepare the financial statements on the
going concern basis unless it is inappropriate to presume that the company
will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply
with the Companies Act 1985. The directors are also responsible for
safeguarding the assets of the company and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
THE DIRECTORS' REPORT (CONTINUED)
YEAR ENDED 31st JANUARY 1999
AUDITORS
A resolution to re-appoint Ashford Read as auditors for the ensuing year will
be proposed at the annual general meeting in accordance with section 385
of the Companies Act 1985.
SMALL COMPANY PROVISIONS
This report has been prepared in accordance with the special provisions for
small companies under Part VII of the Companies Act 1985.
Registered office: Signed by order of the directors
12 Acorn Business Centre
Northarbour Road
Cosham
Portsmouth
Hampshire /s/ A. P. Cowler
PO6 3TH
MR A. P. COWLER
Company Secretary
Approved by the directors on 12 AUG 1999
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NETWORK SOLUTIONS (NORTHERN) LIMITED
AUDITORS' REPORT TO THE SHAREHOLDERS
YEAR ENDED 31st JANUARY 1999
We have audited the financial statements on pages 5 to 10 which have been
prepared in accordance with the Financial Reporting Standard for Smaller
Entities (effective March 1999), under the historical cost convention and the
accounting policies set out on page 7.
RESPECTIVE RESPONSIBILITIES OF THE DIRECTORS AND THE AUDITORS
As described on page 2, the company's directors are responsible for the
preparation of the financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report
our opinion to you.
BASIS OF OPINION
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements.
It also includes an assessment of the significant estimates and judgements
made by the directors in the preparation of the financial statements, and of
whether the accounting policies are appropriate to the company's
circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial
statements are free from material misstatement, whether caused by fraud or
other irregularity or error. In forming our opinion we also evaluated the
overall adequacy of the presentation of information in the financial
statements.
OPINION
In our opinion the financial statements give a true and fair view of the
company's state of affairs as at 31st January 1999 and of its profit for the
year then ended, and have been properly prepared in accordance with the
Companies Act 1985.
/s/ Ashford Read
40 Alexandra Road
Freemantle Chartered Accountants
Southampton & Registered Auditors
Hampshire
SO15 5DG
12 AUG 1999
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NETWORK SOLUTIONS (NORTHERN) LIMITED
PROFIT AND LOSS ACCOUNT
YEAR ENDED 31st JANUARY 1999
Note 1999 1998
L L
TURNOVER 681,504 546,049
Cost of sales (551,023) (443,831)
--------- ---------
GROSS PROFIT 130,481 102,218
Distribution costs (13,006) (21,486)
Administrative expenses (104,231) (130,453)
Other operating income 344 -
--------- ---------
OPERATING PROFIT/(LOSS) 3 13,588 (49,721)
Interest payable and similar charges (2,600) (115)
--------- ---------
PROFIT/(LOSS) ON ORDINARY ACTIVITIES 10,998 (49,836)
BEFORE TAXATION
Tax on profit/(loss) on ordinary activities - -
--------- ---------
RETAINED PROFIT/(LOSS) FOR THE
FINANCIAL YEAR 10,988 (49,836)
Balance brought forward (49,836) -
--------- ---------
Balance carried forward (38,848) (49,836)
--------- ---------
--------- ---------
The notes on pages 7 to 10 form part of these financial statements.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
BALANCE SHEET
31st JANUARY 1999
Note 1999 1999
L L L L
FIXED ASSETS
Tangible assets 4 3,711 5,725
CURRENT ASSETS
Stocks - 2,364
Debtors 5 100,705 133,666
Cash at bank and in hand 82 -
--------- ---------
CREDITORS: Amounts falling due
within one year 6 (133,346) (181,591)
--------- ---------
NET CURRENT LIABILITIES (32,559) (45,561)
-------- --------
TOTAL ASSETS LESS CURRENT LIABILITIES (28,848) (39,836)
-------- --------
-------- --------
CAPITAL AND RESERVES
Called-up equity share capital 9 10,000 10,000
Profit and loss account (38,848) (49,836)
-------- --------
DEFICIENCY (28,848) (39,836)
-------- --------
-------- --------
These financial statements have been prepared in accordance with the special
provisions for small companies under Part VII of the Companies Act 1985 and
with the Financial Reporting Standard for Smaller Entities (effective March
1999).
These financial statements were approved by the directors on the 12 AUGUST
1999, and are signed on their behalf by:
/s/ A.P. Cowler
- ----------------------
MR A.P. COWLER
The notes on pages 7 to 10 form part of these financial statements.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31st JANUARY 1999
1. ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements have been prepared under the historical cost
convention, and in accordance with the Financial Reporting Standard for
Smaller Entities (effective March 1999).
TURNOVER
The turnover shown in the profit and loss account represents amounts
invoiced during the year, exclusive of Value Added Tax.
DEPRECIATION
Depreciation is calculated so as to write off the cost of an asset, less
its estimated residual value, over the useful economic life of that
asset as follows:
Fixtures & Fittings - 15% reducing balance basis
Equipment - 33% reducing balance basis
STOCKS
Stocks are valued at the lower of cost and net realisable value, after
making due allowance for obsolete and slow moving items.
OPERATING LEASE AGREEMENTS
Rentals applicable to operating leases where substantially all of the
benefits and risks of ownership remain with the lessor are charged
against profits as incurred.
DEFERRED TAXATION
Provision is made, under the liability method, to take account of timing
differences between the treatment of certain items for accounts purposes
and their treatment for tax purposes. Tax deferred or accelerated is
accounted for in respect of all material timing differences to the
extent that it is considered that a net liability may arise.
2. GOING CONCERN
At the balance sheet date the company's liabilities exceeded its assets
by L28,848. The day to day operation of the company is dependent upon
support from its directors, associated companies, bankers and trade
creditors. The support of the directors and associated companies has
been confirmed for the foreseeable future. Subsequent to the year end
the company has taken significant measures to ensure improved management
control and trading performance. These steps, together with the assumed
continued support of the company's bankers and trade creditors, provide
the directors with the opinion that it is appropriate to prepare the
financial statements on the going concern basis.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31st JANUARY 1999
3. OPERATING PROFIT/LOSS
Operating profit/(loss) is stated after charging/(crediting):
1999 1998
L L
Directors' emoluments - -
Depreciation 1,380 1,011
Profit on disposal of fixed assets (344) -
Auditors' fees 1,200 1,050
------- -------
------- -------
4. TANGIBLE FIXED ASSETS
FIXTURES & EQUIPMENT TOTAL
FITTINGS
L L L
COST
At 1st February 1998 1,025 5,711 6,736
Additions 795 3,425 4,220
Disposals - (5,711) (5,711)
------ ------- -------
At 31st January 1999 1,820 3,425 5,245
------ ------- -------
------ ------- -------
DEPRECIATION
At 1st February 1998 154 857 1,011
Charge for the year 250 1,130 1,380
On disposals - (857) (857)
------ ------- -------
At 31st January 1999 404 1,130 1,534
------ ------- -------
------ ------- -------
NET BOOK VALUE
At 31st January 1999 1,416 2,295 3,711
------ ------- -------
------ ------- -------
At 31st January 1998 871 4,854 5,725
------ ------- -------
------ ------- -------
5. DEBTORS
1999 1998
L L
Trade debtors 92,238 - 129,911
Other debtors 1,375 1,375
Prepayments and accrued income 7,092 2,380
-------- --------
100,705 135,666
-------- --------
-------- --------
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NETWORK SOLUTIONS (NORTHERN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31st JANUARY 1999
6. CREDITORS: Amounts falling due within one year
1999 1998
L L L L
Bank loans and overdrafts 3,506 8,158
Trade creditors 50,135 110,916
Amounts owed to group undertakings 69,364 38,501
Other creditors including:
PAYE and social security 3,696 10,844
VAT 3,390 5,688
-------- -------
7,086 16,532
Accruals and deferred income 3,255 7,484
-------- -------
133,346 181,591
-------- -------
7. COMMITMENTS UNDER OPERATING LEASES
At 31st January 1999 the company had aggregate annual commitments under
non-cancellable operating leases as set out below.
1999 1998
L L
Operating leases which expire:
Within 1 year 12,116 5,500
Within 2 to 5 years 5,083 10,925
-------- -------
17,199 16,425
-------- -------
8. RELATED PARTY TRANSACTIONS
The company was under the control of the directors (Mr. A. P. Cowler,
Mr. W. Bridgen, Mr. S. Sutton and Mr. J. C. Beckett) and Network
Solutions Group Limited throughout the year. The four directors are
also the sole directors of Network Solutions Group Limited as well as
Network Solutions Limited.
During the year the company purchased goods and services from Network
Solutions Limited amounting to L130,161 (1998 - L1,890). During the
year the company also sold goods and services to Network Solutions
Limited amounting to L640 (1998 - L291). At the balance sheet date the
company owed Network Solutions Limited L69,364 (1998 - L38,509).
Mr. A. P. Cowler is a director of and has a controlling interest in The
Surrey Design Partnership Limited. During the year the company made
sales to The Surrey Design Partnership Limited of LNil (1998 - L530).
There were no trading balances outstanding between the companies at the
balance sheet date.
Mr. I. C. Cocks has a controlling interest in Taylor Cocks (formerly
Cocks & Co.). During the year the company acquired services from Taylor
Cocks amounting to Lnil (1998 - L10,252). During the year the company
also sold goods to Taylor Cocks amounting to Lnil (1998 - L2,423).
There were no trading balances outstanding between the companies at the
balance sheet date.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31st JANUARY 1999
9. SHARE CAPITAL
AUTHORISED SHARE CAPITAL:
1999 1998
L L
100,000 Ordinary shares of L1 each 100,000 100,000
-------- --------
-------- --------
ALLOTTED, CALLED UP AND FULLY PAID:
1999 1998
L L
Ordinary share capital brought 10,000 -
forward
Issue of ordinary shares - 10,000
-------- -------
10,000 10,000
-------- -------
-------- --------
10. ULTIMATE PARENT COMPANY
The ultimate parent company is Network Solutions Group Limited - a
company incorporated within the UK.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
MANAGEMENT INFORMATION
YEAR ENDED 31st JANUARY 1999
THE FOLLOWING PAGES DO NOT FORM PART OF THE STATUTORY FINANCIAL STATEMENTS
WHICH ARE THE SUBJECT OF THE AUDITORS' REPORT ON PAGE 4.
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NETWORK SOLUTIONS (NORTHERN) LIMITED
DETAILED PROFIT AND LOSS ACCOUNT
YEAR ENDED 31st JANUARY 1999
1999 1998
L L L L
TURNOVER 681,504 546,049
COST OF SALES
Opening WIP 2,364 -
Purchases 486,835 396,512
Direct wages 61,824 49,683
-------- --------
551,023 446,195
Closing WIP - (2,364)
-------- --------
551,023 443,831
-------- --------
GROSS PROFIT 130,481 102,218
OVERHEADS
Distribution costs 13,006 21,486
Administrative expenses 104,231 130,453
-------- --------
(117,237) (151,939)
-------- --------
13,244 (49,721)
OTHER OPERATING INCOME
Profit on disposal of fixed assets 344 -
-------- --------
OPERATING PROFIT/(LOSS) 13,588 (49,721)
Interest payable and similar charges (2,600) (115)
-------- --------
PROFIT/(LOSS) ON ORDINARY ACTIVITIES 10,988 (49,836)
-------- --------
-------- --------
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NETWORK SOLUTIONS (NORTHERN) LIMITED
NOTES TO THE DETAILED PROFIT AND LOSS ACCOUNT
YEAR ENDED 31st JANUARY 1999
1999 1998
L L L L
DISTRIBUTION COSTS
Freight and carriage 307 528
Vehicle hire 12,699 20,958
-------- --------
13,006 21,486
-------- --------
-------- --------
ADMINISTRATIVE EXPENSES
PERSONNEL COSTS:
Administrative staff salaries 42,365 84,422
ESTABLISHMENT EXPENSES:
Rent and services 5,467 6,591
Rates and water 1,650 2,974
Insurance 526 393
Repairs and maintenance 224 369
------- -------
7,867 10,327
GENERAL EXPENSES:
Motor expenses 5,574 5,703
Travel and subsistence 629 1,189
Telephone 6,975 10,765
Printing, postage, stationery and 978 1,830
advertising
Management services charge 20,000 -
Staff recruitment 936 -
Sundry expenses 75 596
Entertaining 267 824
Legal and professional fees 125 1,714
Accountancy fees 5,959 10,598
Auditors remuneration 1,200 1,050
Depreciation 1,380 1,011
------- -------
44,098 35,280
FINANCIAL COSTS:
Bad debts written off 8,256 -
Bank charges 1,645 424
------- -------
9,901 424
-------- --------
104,231 130,453
-------- --------
-------- --------
INTEREST PAYABLE AND SIMILAR CHARGES
Bank interest payable 175 75
Interest on overdue tax 2,425 40
-------- --------
2,600 115
-------- --------
-------- --------
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