UniVision Engineering Limited
Annual Report
Year ended 31 March 2021
UNIVISION ENGINEERING LIMITED
Annual Report
Year ended 31 March 2021
Contents
Page
Board of Directors, Officers and Professional Advisers
Chairman’s Statement
Directors’ Biographies
Directors’ Report
Remuneration Report
Report on Corporate Governance
Statement of Directors’ Responsibilities
Independent Auditor’s Report to the Members of UniVision
Engineering Limited
Statement of Profit or Loss and Other Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Notice of Annual General Meeting
2
3
10
12
18
19
22
23
29
30
31
32
33
63
UNIVISION ENGINEERING LIMITED - 1 - ANNUAL REPORT 2021
BOARD OF DIRECTORS, OFFICERS
AND PROFESSIONAL ADVISERS
Board of Directors
Stephen Sin Mo KOO, Executive Chairman
Peter Yip Tak CHAN, Chief Executive Officer
Danny Kwok Fai YIP, Finance Director
Ivan Chi Hung CHAN, Director of Operations
Nicholas James LYTH, Non-Executive Director
Ivor Colin SHRAGO, Non-Executive Director
Nominated Adviser
SPARK Advisory Partners Limited
5 St. John’s Lane,
London, EC1M 4BH
U.K.
AIM Stock Code
UVEL
Principal bankers
Hong Kong and Shanghai Banking Corporation
Bank of China (Hong Kong)
Audit Committee
Nicholas James LYTH, Chairman
Ivor Colin SHRAGO
Stephen Sin Mo KOO
Remuneration Committee
Ivor Colin SHRAGO, Chairman
Nicholas James LYTH
Stephen Sin Mo KOO
Company Secretary
Danny Kwok Fai YIP
Registered Office
Unit 201, 2/F Sunbeam Centre,
27 Shing Yip Street,
Kwun Tong, Kowloon,
Hong Kong
Tel: (852) 2389 3256
Fax: (852) 2797 8053
E-mail: uvel@hk.uvel.com
Website: www.uvel.com
Auditor
PKF Hong Kong Limited
Certified Public Accountants
26/F., Citicorp Centre,
18 Whitfield Road,
Causeway, Hong Kong
Registrars
Computershare Investor Services
(Jersey) Limited
Queensway House,
Hilgrove Street,
St Helier,
Jersey JE1 1ES.
UK Depositary
Computershare Investor Services PLC
The Pavilions,
Bridgwater Road,
Bristol BS99 6ZZ,
UK
Broker
SI Capital Limited
46 Bridge Street,
Godalming,
Surrey GU7 1HL
U.K.
UNIVISION ENGINEERING LIMITED - 2 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
I am pleased to report the Company’s audited results for the financial year ended 31 March 2021.
Turnover for the year increased by 4.3% (underlying rate) to £10.9m (2020: £10.7m). This increment
was mainly due to the 4% increase in construction contracts which came from the project of
Upgrading of CCTV System on Campus in City University of Hong Kong and the project for
replacement of system works for MTR Corporation (“MTRC”) of Hong Kong. The Coronavirus has
hindered the installation plans for a period, however it gradually returned to normal in the second half
of the current financial year.
Profit attributable to the equity shareholders for the year is £563K (2020: £452K).
To reward and thank our shareholders for their support, the Board recommends the payment of a final
dividend of 0.26 HK cents per share (2020: 0.55 HK cents).
The increasing concern for enhanced security and surveillance, such as installation of additional
cameras and also facial recognition technology, is the main driver for the growth of video surveillance
market. Therefore, I am optimistic about the prospects of the Company.
In the remainder of this report, I shall go into further details of our order book relating to the Major
Contract, financial review, business review, and end with prospect statement.
THE MAJOR CONTRACT WITH MTRC
The contract with MTRC for the replacement works of the Closed-Circuit Television (CCTV) systems
for numerous MTRC railway lines remains the major driver for the business of the Company since it
was awarded to UniVision in May 2017. The Company is responsible for replacing the existing
analogue CCTV system installed in the stations along the specified lines by a new Internet Protocol-
based, digital CCTV system. At inception, the Major Contract’s expected completion date was
November 2023. However, with the further additional orders and supplementary agreements added
subsequently, the Board now expects that the work on the Major Contract is unlikely to complete in
full until July 2024.
The Major Contract allows for regular billing completed and certified. The MTRC Contract also
allows for variation of orders. With further agreed add-ons since May 2017, the total current value of
this contract has increased to HK$489.7 million (approximately £48.2 million at current exchange
rates) spread over six year and nine months period, with an expected completion date of July 2024.
Up to the financial year ended 31 March 2021, UniVision has invoiced a total of approximately
HK$172.7m, leaving a further order book of HK$317m to be billed over the remaining period. The
gross valuation of certified works on the Major Contract was HK$199.8m up to 31 March 2021.
To control the project cost, the Company is working with its suppliers and sub-contractors to ensure
that we get reliable supply and competitive credit terms. With China Rail Group, the Company’s
strategic partner, providing the subcontracting works for certain lines of the Major Contract, it ensures
the adequate supply of skilled personnel and also more cost effective than local sources.
The Board also closely monitors the Company’s working capital to be certain that we have adequate
financial resources to drive the Major Contract to completion. The Company reviews its financial
position all the time and seeks additional and/or more sources of funding, as may be appropriate,
including but not limited to capital market and banking facilities.
UNIVISION ENGINEERING LIMITED - 3 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
(Continued)
POTENTIAL CLAIM
As previously announced, the Company received a writ of summons (Statement of Claim), Hong
Kong High Court Action No. 2090 of 2020, from the solicitors of Dimension Data China Hong Kong
Limited (“Dimension Data”), the Plaintiff, on 14 December 2020 alleging breach of contract,
claiming against the Company for liquidated damages for an amount of HK$10.95m plus pre-
judgment and post-judgment interest and legal costs. The Company has cross claim against
Dimension Data, inter alia, for breach of contract and/or negligence and/or misrepresentation and
accordingly to claim for loss and damages for the same and legal costs.
The Board does not consider that the claim has any foundation and believes that Dimension Data was
in breach of protocol in the manner which it has brought this claim. The Defence and Counterclaim
was filed to the High Court on 24 February 2021. The solicitors of Dimension Data filed the Reply
and Defence to Counterclaim on 28 July 2021.
Based on legal opinion, the said Action has reached the stage of close pleadings, whereas parties are
expected to enter into statutory mediation in due course. Whether the parties might reach a settlement
out of court would depend on the course of mediation and other factors. Up to the date of this report,
no mediation between the Company and Dimension Data has been conducted.
FINANCIAL REVIEW
Highlights of Statement of Profit or Loss and Other Comprehensive Income are:
Revenue increased by 4.3% to £10.9m in the reporting period (2020: £10.7m). This revenue
increase came mainly from contributions of construction contracts that increased by 4% as
compared with last year. The majority of this increment came from the project to upgrade
CCTV System on Campus in City University of Hong Kong.
Revenue from construction contracts, the Group’s largest business segment, represented
82.7% of the total income (2020: 82.9%). Revenue from maintenance contracts represented
15.1% of the total income (2020: 15.2%) for the Company.
Other construction contracts besides the Major Contract, including the installation, relocation,
modification and replacement works that provided by MTRC also contributed significant
income.
Contribution from maintenance contracts was up by 3.7%, compared to the prior year. The
increase in maintenance contracts was mainly due to the additional repairs orders for damaged
Public Address System at certain stations of MTRC.
UNIVISION ENGINEERING LIMITED - 4 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
(Continued)
The gross profit remained stable at £2m in the reporting period (2020: £2m), however, our
gross margin was 17.9% which was lower than that of last reporting period (2020: 19.4%).
The main reason for the decrease in gross profit margin in the Group’s maintenance contracts
by 9.6%. The increased subcontracting charges and internal manpower pushed up costs,
leading to an increase in operating cost for the maintenance contracts with MTRC in the
current financial year. Moreover, the outbreak of COVID-19 decelerated the progress of
existing projects, resulting in an increase in overhead costs and subcontracting costs. On the
other hand, the Company adopted measures to control the operating cost with its suppliers and
subcontractors.
The underlying profit for the current year was £170K (2020: £452K) which excluded other
income from Hong Kong Government Employment Support £386K for the month of June to
November 2020, £4.9K from Construction Industry Council "Anti-Epidemic Fund", and £2K
subsidy from Transport Department. Total amount for the anti-epidemic relief from Hong
Kong Government and public organization was £393K.
Our operating expenses were mainly administration expenses. For the year, administrative
expenses increased by 14% to £1.73m (2020: £1.52m). These were caused by the increased
headcount and associated personnel expenses (salaries, annual leave expenses, provident
fund), The number of staff has increased from 73 to 79 during the reporting period. In
addition, rental expenses increase due to renting one new office, increased repairs and
maintenance fees, electricity charges and legal fees.
Profit before tax increased to £563K in the reporting period (2020: £452K) nevertheless the
experienced lower gross profit and rising operating expenses.
The Company has unused tax losses to offset the taxable profit for the year. I can report that
the profit attributable to the shareholders of the Company also increased to £563K for the
financial year ended 31 March 2021, compared to £452K for the last financial year.
As a result of increase in profit attributable to shareholders, basic earnings per share increased
to 0.15p for this reporting financial year (2020: 0.12p).
On the Statement of Financial Position, the highlights are:
Contract assets increased to £8.4m as at 31 March 2021, from £6.2m as at 31 March 2020,
mainly due to the longer time applying for billing, particularly for the Major Contract that
due to more installation works performed in this current year that of last year which most
billing for delivery of equipment. Also, the “Work from home” policy of government
departments and MTRC due to outbreak of the COVID-19 pandemic has caused delays in the
process of certification and led to slow billing to MTRC and the Hong Kong Government.
Cash and cash equivalents stood at £284K as at 31 March 2021 (2020: £679K), representing
a decrease of £395K.
Total equity attributable to shareholders stood at £8.2m as at 31 March 2021 (As at 31 March
2020: £8.7m), or a decrease of £546K, mainly due to the loss of £902K on exchange
differences on translation of financial statements from HK$ to £, the reporting currency.
UNIVISION ENGINEERING LIMITED - 5 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
(Continued)
Deposit placed for a life insurance policy of £862K as at 31 March 2021, which is the value
of the keyman insurance plan placed as security for banking facilities provided by a banker to
the Company.
Bank borrowings of £562K as at 31 March 2021 (2020: £682K) represents the loan provided
by a banker for financing a certain portion of the premium for the insurance policy as above
mentioned.
On the Statement of Cash Flows, the highlights are:
The Company generated positive cash flow from operations of £34K in the reporting period
(2020: negative £111K).
The Board attributes this improvement to closer monitoring and effective control of working
capital, together with more efficient use of our banking facilities.
Repayment of bank loans of £54K.
During the year under review, a relative strengthening in the HK$ at the year-end has led to a 11.3%
appreciation in the GBP reporting amount in the Statement of Financial Position. It led to the
significant non-cash other comprehensive loss of £902K (2020: gain £549K) on exchange differences
arising on translation of foreign operations.
All figures in the above require to be adjusted for comparison purposes. All comparative percentages
stated in the Chairman’s Statement are adjusted to show the underlying change (net of translation
effect on foreign exchange).
To consistent with the Company’s dividend policy, the Board has proposed the payment of a final
dividend of 0.26 HK cents (gross) per share for the financial year ended 31 March 2021 (2020: 0.55
HK cents). Dividend timetable is as follows:
Ex date:
Record date:
Payment date:
16 September 2021
17 September 2021
15 October 2021
Payment of the dividend is subject to the approval by the shareholders at the upcoming Annual
General Meeting.
UNIVISION ENGINEERING LIMITED - 6 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
(Continued)
BUSINESS REVIEW
I will include the following topics in this section: our addressable market segments, business
environment in which we operate, our customer base, new business and segment and the management
strategy for the next reporting period.
Addressable Market Segments
According to the Market Research Report by Mordor Intelligence: Video Surveillance System
Market-Growth, Trends, COVID-19 Impact and Forecast (2021 - 2026), the video surveillance
systems market is expected to grow at a CAGR of 9.31% over the forecast period 2021 to 2016
though the economic consequence of the COVID-19 pandemic will undoubtedly hit the professional
video surveillance market to a certain extent. On the other hand, Asia Pacific Region is regarded as
the fast growing market. This market has grown significantly due to its increasing use in the field of
security and law enforcement, to reduce the crime rate in their countries. The Board believes that our
addressable market segment will undergo a steady growth period
The use of video surveillance in business is growing significantly due to the increasing need for
physical security, the growth in adoption of AI, coupled with the use of cloud-based services for
centralized data. The growth of the video surveillance market is expected to be fuelled by the
introduction of new IP-based digital technologies, to detect and prevent undesirable behaviour, such
as shoplifting, thefts, vandalism, and terror arracks.
Video surveillance systems are increasingly used for many applications, such as crime prevention,
tracking consumer behaviour, monitoring industrial processes and traffic management. The
commercial sector is expected to be the largest market share during the forecast period. Growing
focus on infrastructure protection, public security and increasing demand for high resolution imaging
are other key factors driving the market.
The Board can see growing demand for wireless monitoring networking and wireless infrastructure
(such as IP and 5G) as the key growth driver for the market. There is growing demand for wireless
monitoring solution particularly the remote surveillance with 5G mobile technology. The advantage of
5G technology for CCTV to overcome the latency issue that people may have encounter in the past.
Moreover, such new solutions can provide better video quality and efficiency for remote monitoring.
The Board expects to see more potential projects for deployment of 5G CCTV solutions.
The technology of video analytics, such as facial recognition, is being enhanced rapidly and
UniVision has actively participated in this market, such as the contract for supply and installation of
the video analytic monitoring system at Tai Tam Correctional Institution. The video analytic solution
of Smart Prisons is designed to enhance the effectiveness of movement detection in confined areas. In
the case of abrupt massive movement or the unusual stillness of people, it can automatically detect
and identify abnormal incidents at any time. This effective detection tool facilitates early intervention
and prevents any potentially dangerous acts which can save people from injury. The Company won a
Silver Medal for its “Smart Prison -Video Analytic Monitoring System” Invention at the 2021 Geneva
International Exhibition of Invention.
Under the Major Contract, the Company acts as network service provider in the application of CCTV
systems. It has provided the channel for the Company entering the business as a provider of network
service and information technology in the application in other fields.
UNIVISION ENGINEERING LIMITED - 7 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
(Continued)
Business Environment
COVID-19 has seriously affected the business environment in Hong Kong in last year. It caused
adverse effects on the Hong Kong economy, particularly in the retail and tourism sectors.
Nevertheless, the demand for upgrades the video surveillance system, such as facial recognition
capabilities, is rising.
Unlike the hotel, travel, catering, retailing sectors, COVID-19 has not seriously affected the
Company’s business. Nevertheless, as mentioned at the first part, for a period of time, it hindered the
installation plans and affected the revenue.
Additional work orders for replacement of damaged CCTV equipment caused by vandalism increased
job orders and revenue from maintenance contracts for the Company. We anticipate that the Company
will see more business opportunities with MTRC for new projects. MTRC has announced its new
railway development including the following new railway lines and extensions: -
South Island Line (West)
Northern Link
Tung Chung Line Extension
Tuen Mun South Extension
North Island Line
East Kowloon Line
Hung Shui Kiu Station
Customer base
MTRC remains the Company’s largest customer this financial year, representing 78.7% of the
Company’s total revenue. In addition, Electrical and Mechanical Services Department (“EMSD”) and
other commercial clients are also parts of our customer base.
EMSD and other departments of Hong Kong Government are another sources of the Company’s
customer base. The Company is on the list in the category of Approved Specialist Contractors for
Public Works: Video Electronics Installation. It indicates that UniVision is a qualified public works
provider who enables to comply with the financial, technical and management criteria for the
retention on the list of specialist contractors.
To avoid the concentration of customers, the Company aims to diversify its customer base particularly
to the private sector, such as sizeable multinational private enterprises.
New business
The Board always explores other potential business opportunities in other business particularly in the
Electrical and Mechanical (“E&M”) business. Indeed the Company has set up a new company called
Vision Key International Limited in September 2020 for tendering potential projects outside Hong
Kong. The Board is also actively considering setting up a branch or office in U.K. to expand its core
business in the coming year.
UNIVISION ENGINEERING LIMITED - 8 - ANNUAL REPORT 2021
CHAIRMAN’S STATEMENT
(Continued)
Our Strategy
Given the above market, business opportunities, and customer base analysis, I see three key future
objectives:
Financial: To deliver the MTRC Contract and other potential large-scale projects efficiently
and profitably, the Company engages committed subcontracting partners with technical and
financial strength to minimise the risks associated with working capital the sizeable contract.
The Board considers this outreach to be both desirable and prudent for the Company’s further
growth in the market.
Technology: The Company will continue to acquire skills in networking and wireless
technology area and software skills for video analytics and facial recognition applications, to
help provides customisation and localisation for our clients. Additional network engineers
will be recruited to achieve the above objectives. We will also co-operate with the high
qualified vendors, research institutes and market-leading specialists in these technology areas
to help us acquire new contracts.
People: Human Resources is one of the most valuable resources in the Company. In facing the
high demand for the Major Contract, the Company will continue to equip the project
managers and officers, together with the experienced engineers and system designers with
technical skills to deliver the contract effectively and actively in tendering new contracts.
PROSPECTS
UniVision has been incorporated in Hong Kong for over 41 years. It is a milestone that signifies the
Company’s longevity and good standing in the security and surveillance business. The Company’s
core competency relies on UniVision’s brand name; and its dedicated, experienced, people.
The Board expects that high demand in security and surveillance market will provide the ground and
opportunity for the Company to grow. Given our sizable order book, especially with the Major
Contract, the Company will derive constant revenue for the next few reporting periods. The Board
will continuously monitor costs to generate profits attributable to shareholders.
The COVID-19 pandemic has caused an unprecedented challenge across the world which has
dampened economic activity. Facing uncertainties, the Company hope the development of COVID-19
vaccines and recent mass vaccination can control the pandemic and facilitate the economy recovery.
Finally, on behalf of the Board, I would like to thank our customers, suppliers, sub-contractors and
shareholders for their continued support of UniVision. I would also like to acknowledge the hard
work of the management and all our staff for their contribution.
MR. STEPHEN SIN MO KOO
EXECUTIVE CHAIRMAN
6 September 2021
UNIVISION ENGINEERING LIMITED - 9 - ANNUAL REPORT 2021
DIRECTORS’ BIOGRAPHIES
DIRECTORS’ BIOGRAPHIES
Stephen Sin Mo KOO – Executive Chairman (aged 64)
Mr. Koo joined UniVision in 1998 and was appointed as a Director on 3 March 2003. He is
responsible for overall strategic planning of our Company. He holds both a Bachelor Degree from the
University of Technology, Sydney, and a Master Degree in Business from the Royal Melbourne
Institute of Technology in Australia. He is the Director of Up Sky Investments Limited and
UniVision Holdings Limited, the Company’s major shareholding companies. He is a fellow of the
Institute of Certified Public Accountants of Australia. Mr. Koo is a member of the Audit Committee
and the Remuneration Committee.
Peter Yip Tak CHAN – Chief Executive Officer (aged 57)
Mr. Chan joined UniVision in 1995 and was appointed as a Director on 3 October 2014. He is
responsible for formulating and overseeing the implementation of UniVision’s business development
strategies and for the management of the Company’s operations. Mr. Chan has rich experience in
sales and project management. He holds a Degree in Computing from the University of Northwest
Missouri. He is also responsible for management of UniVision’s Sales and Marketing Division.
Danny Kwok Fai YIP –Finance Director (aged 57)
Mr. Yip was appointed as Finance Director on 18 September 2007. He was the Financial
Controller for the Company before the appointment. Mr. Yip obtained a Master of Corporate Finance
degree from the Hong Kong Polytechnic University and a Bachelor of Commerce (Accounting)
degree from the Curtin University of Technology, Australia. Before joining the Company, Mr. Yip
was the Accounting Manager of Nissin Food Group (Stock code 1475 of Hong Kong Stock
Exchange), the leading instant noodle and food manufacturing MNC. Mr. Yip has over 20 years’
experience in finance and accounting in different industries. He is a fellow member of the Association
of Chartered Certified Accountants and a member of Hong Kong Institute of Certified Public
Accountants. He also acts as Company Secretary for the Company.
Ivan Chi Hung CHAN – Director of Operations (aged 46)
Mr. Chan was appointed as a Director on 24 June 2020. He is also responsible for the
management of UniVision’s all operating divisions. Mr. Chan joined UniVision as Technician in
October 1996, and was promoted to a number of increasingly senior positions in various departments,
prior to being appointed to Chief Operations Officer on 1 November 2019. He holds a Bachelor of
Engineering (Honours) degree in Electronics and Communication Engineering from the City
University of Hong Kong.
UNIVISION ENGINEERING LIMITED - 10 - ANNUAL REPORT 2021
DIRECTORS’ BIOGRAPHIES
(Continued)
Nicholas James LYTH – Non-executive Director (aged 55)
Mr. Lyth is a qualified chartered management accountant and has rich and solid experience
as a finance professional, having spent a number of years as director of UK companies. He has lived
and worked in China and can speak and write Mandarin. He is responsible for day to day liaison with
UK investors for UniVision. Mr. Nyth is the Chairman of the Audit Committee and a member of the
Remuneration Committee.
Ivor Colin SHRAGO – Non-executive Director (aged 78)
Mr. Shrago was admitted as solicitor to the Supreme Court of England and Wales in 1966 and
to the Supreme Court of Hong Kong in 1997. He has more than 40 years’ experience practising law.
In 1996, he was the General Counsel to Peregrine Direct Investments Limited, the investment arm of
the Peregrine Banking Group in Hong Kong, which was primarily involved in fund management. He
then joined the asset management arm of Vigers Asset Management Limited as managing director,
while at the same time acting as general counsel for the Company. In 2002, Ivor joined Druces LLP
(formerly Druces & Attlee) and was Partner until 2007. Since that time he has been a consultant with
a number of city law firms and has been a non-executive director of a number of AIM quoted and
other public companies. Mr. Shrago is the Chairman of the Remuneration Committee and a member
of the Audit Committee.
UNIVISION ENGINEERING LIMITED - 11 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
DIRECTORS’ REPORT
The Directors have pleasure in presenting their annual report together with the audited financial
statements of the Company for the year ended 31 March 2021.
.
Principal Activities and Segment Analysis Operations
The principal activities of the Company are the supply, design, consultation, installation and
maintenance of closed circuit television and surveillance systems, and the sale of security
related products. An analysis of the Company’s performance by business segments is set out in
note 7 to the financial statements.
Review of the Business
Details on the assessment and analysis of the Company’s performance and its material factors
underlying its results and financial position and its future development are included in the
Chairman’s Statement.
Financial Position
The Company’s profit for the year ended 31 March 2021 and the state of affairs of the
Company at that date are set out in the statement of profit or loss and other comprehensive
income on page 29 and in the statement of financial position on page 30, respectively.
The Company’s changes in shareholders’ equity for the year ended 31 March 2021 are set out
in the Company’s statement of changes in equity on page 31.
The Company’s cash flow for the year ended 31 March 2021 is set out in the Company’s
statement of cash flows on pages 32.
UNIVISION ENGINEERING LIMITED - 12 - ANNUAL REPORT 2021
DIRECTORS’ REPORT
(Continued)
Key Performance Indicators (KPI)
Current Ratio:
Current Assets / Current Liabilities
Average Collection Period :
Trade receivables (net of allowance for
doubtful debts) / Revenue per day
Inventory Turnover :
Cost of revenue / Inventories
Gross profit Margin :
Gross profit / Revenue
Gearing Ratio:
Borrowings /Equity
Quick Ratio :
(Current Assets –Inventories) / Current
Liabilities
2021
2020
1.6
1.8
11 days
19 days
5.7
8.4
18%
19%
7%
1.4
5%
1.6
:
:
:
:
:
:
Share Capital and Reserves
Details of the movements in share capital are set out in note 28 on page 58.
The movements in reserves during the year are set out in the statement of changes in equity on
page 31.
Dividends
The Directors propose that the payment of a final dividend of 0.26 HK cents (gross) per share
for the financial year ended 31 March 2021.
Plant and Equipment
Details of the movements in plant and equipment are set out in note 16 on page 52.
UNIVISION ENGINEERING LIMITED - 13 - ANNUAL REPORT 2021
DIRECTORS’ REPORT
(Continued)
Directors
The directors who held office during the year and to the date of this report were as follows:
Stephen Sin Mo KOO
Nicholas James LYTH
Ivor Colin SHRAGO
Danny Kwok Fai YIP
Peter Yip Tak CHAN
Ivan Chi Hung CHAN - appointed on 24 June 2020
Edward Keung Hung LI - appointed on 24 June 2020 and ceased from 1 July 2021
Mr. Stephen Sin Mo KOO, Mr. Danny Kwok Fai YIP, Mr. Nicholas James LYTH and Mr.
Ivor Colin SHRAGO retire by rotation at the forthcoming annual general meeting in accordance
with the Company’s Articles of Association and, being eligible, the current directors offer
themselves for re-election.
Directors’ Interests in Contracts
No director had a material interest in any contract of significance to the business of the
Company to which the Company or its holding company was a party at the end of the year or at
any time during the year.
Directors’ Interests in Shares
According to the register of Directors’ Shareholdings kept by the Company, particulars of
interests of the Directors (or their immediate families) who held office at the end of the
financial year in the ordinary shares of the Company are as set out in the table below:
Ordinary Shares held as at 31 March 2021
Stephen Sin Mo KOO
Nicholas James LYTH
Ivor Colin SHRAGO
Danny Kwok Fai YIP
Peter Yip Tak CHAN
279,703,700*
1,200,000
5,315,000
-
-
UNIVISION ENGINEERING LIMITED - 14 - ANNUAL REPORT 2021
DIRECTORS’ REPORT
(Continued)
* 78,744,000 ordinary shares are registered under the name of Up Sky Investments Limited which is
an investment holding company incorporated under the laws of the British Virgin Islands and is
wholly-owned by Mr. Stephen Sin Mo KOO. Mr. Stephen Sin Mo KOO, is deemed to be interested
in all the ordinary shares registered in the name of Up Sky Investments Limited.
Following the share transaction on 8 July 2011, the entire stake of UniVision Holdings Limited (it
holds 183,736,000 shares of the Company) was transferred to Up Sky Investments Limited, a
company that is wholly owned by Mr. Stephen Koo.
A share transaction effected on 17 November 2015, Up Sky Investments Limited transferred its entire
stake in UniVision Holdings Limited to Mr. Stephen Koo. In addition, Mr. Stephen Koo is also
interested in 17,223,700 ordinary shares in the Company.
In summary, Mr. Stephen Koo has a total direct and indirect interest in 279,703,700 ordinary shares in
the Company, equivalent to 72.9% of the Company’s total issued share capital.
Save as disclosed in this report, none of the Directors (or their immediate families) who held office at
the end of the financial year had interests in the share capital of the Company during the financial year.
Directors’ Rights to Acquire Shares or Debentures
At no time during the year were rights to acquire benefits by means of the acquisition of shares in or
debentures of the Company granted to any director or their respective spouse or minor children, or
were any such rights exercised by them; or was the Company or its holding company, a party to any
arrangement to enable the directors of the Company to acquire by means of the acquisition of shares
in, or debentures of any other body corporate.
Substantial Shareholdings
As at 27 August 2021, the Directors had been informed of the following companies that held 3% or
more of the Company’s issued ordinary share capital:
UniVision Holdings Limited
(1)
Up Sky Investments Limited
(2)
JIM Nominees Limited
JARVIS
Hargreaves Lansdown
(Nominees) Limited 15942
Hargreaves Lansdown
(Nominees) Limited VRA
Number
ordinary shares
of
183,736,000
% of total issued share
capital
47.9
78,744,000
20.5
17,861,440
17,728,393
14,022,904
4.7
4.6
3.7
UNIVISION ENGINEERING LIMITED - 15 - ANNUAL REPORT 2021
DIRECTORS’ REPORT
(Continued)
(1) UniVision Holdings Limited is an investment holding company incorporated under the laws of the
British Virgin Islands and was formerly owned by Up Sky Investments Limited Up Sky Investments
Limited transferred the entire stake to Mr. Stephen KOO on 17 November 2015.
(2) Up Sky Investments Limited is an investment holding company incorporated under the laws of the
British Virgin Islands and is wholly-owned by Mr. Stephen Sin Mo KOO.
Payments to Creditors
The Company does not follow any code or standard on payment practice but instead the Company
policy is to pay all creditors in accordance with agreed terms of business.
Political and Charitable Donations
During the year the Company made Nil charitable contributions (2020: Nil). No political contribution
was made.
Environmental Policy
The Company aims to protect the environment by minimising environmental adverse in daily
operations and encourage recycling for more efficient use of resources. Besides, energy efficiency
practices to reduce the energy consumption. Air conditioning, electricity and water conservation have
been closely monitored and reviewed to maintain an efficient operation. Proper treatment of industrial
wastes and hazardous material has been put in practice.
Employees
The Company values staff involvement at all levels of operations, and uses various means to train,
inform and consult the employees. The Company encourages the management to discuss regularly
with the employees on both corporate and individual matters and discloses information to them that
will increase their awareness of the financial and economic factors affecting the Company.
The Company recognises its obligations to provide a fair consideration on all vacancies towards
people with disability and to ensure that such persons are not discriminated against on the grounds of
their disability. For those employees who become disabled during their employment period, the
Company will make every effort to ensure that their employment will continue and that sufficient
training is arranged.
Annual General Meeting
The Annual General Meeting of the Company will be held at UniVision Engineering Limited, Unit
201, 2/F Sunbeam Centre, 27 Shing Yip Street, Kwun Tong, Kowloon, Hong Kong, on 30 September
2021 at 5:00 p.m. The Notice of Meeting appears on page 63.
Annual Report
The annual report for the year ended 31 March 2021 will be uploaded on the Company’s website
www.uvel.com on 6 September 2021 upon announcement and the hard copy will be sent to
shareholders by our Registrars, Computershare Investor Services (Jersey) Limited.
UNIVISION ENGINEERING LIMITED - 16 - ANNUAL REPORT 2021
DIRECTORS’ REPORT
(Continued)
Auditor
PKF Hong Kong Limited, Certified Public Accountants, was appointed as our auditor for the year. A
resolution to re-appoint PKF Hong Kong Limited, Certified Public Accountants as auditor of the
Company will be put to the forthcoming Annual General Meeting.
By Order of the Board
Mr. Stephen Sin Mo KOO
Executive Chairman
Hong Kong
6 September 2021
UNIVISION ENGINEERING LIMITED - 17 - ANNUAL REPORT 2021
REMUNERATION REPORT
The Remuneration Committee presents this report to shareholders on behalf of the Board.
Membership of Remuneration Committee
The Remuneration Committee comprises Mr. Ivor Colin SHRAGO (our Non-executive Director), Mr.
Nicholas James LYTH (our Non-executive Director) and Mr. Stephen Sin Mo KOO (our Executive
Chairman) and is chaired by Mr. Ivor Colin SHRAGO.
Policy Statement
The Remuneration Committee sets the remuneration and all other terms of employment of the
Executive Directors with a vision to provide a package which is suitable for the responsibilities
involved. The remuneration of the Executive Directors is determined by the Remuneration
Committee having regard to the performance and experience of individuals, the overall performance
of the Company and market trends.
Directors’ Remuneration
Details of individual director’s remuneration for the year are set out in the table below:
Salary and
fees
£
Pension
scheme
contribution
£
Bonus
£
2021
Total
£
2020
Total
£
Executive Directors
Stephen Sin Mo KOO
Peter Yip Tak CHAN
Danny Kwok Fai YIP
Ivan Chi Hung CHAN
Edward Keung Hung LI
Chun Pan Wong
Mike Chiu Wah CHAN
Non-executive Director
Nicholas James LYTH
Ivor Colin SHRAGO
-
73,464
68,627
44,410
44,059
-
-
14,183
14,183
-
1,773
1,773
1,330
1,330
-
-
-
6,091
5,690
5,390
5,325
-
-
-
81,328
76,090
51,130
50,714
-
-
-
76,211
73,920
-
-
75,769
52,529
-
-
-
-
14,183
14,183
14,497
14,497
Directors’ Interests in Contracts and Interests in Shares
Details of Directors’ Interests in Contracts and Interests in Shares are given in the Directors’ Report.
UNIVISION ENGINEERING LIMITED - 18 - ANNUAL REPORT 2021
REPORT ON CORPORATE GOVERNANCE
Introduction
The Directors believe that their foremost function is to generate continuous profits for the
Company’s investors, and that this should be achieved by a policy of high standards of
corporate governance, integrity and ethics. Changes to AIM rules on 30 March 2018 required
AIM companies to apply a recognised corporate governance code from 28 September 2018.
The Company has chosen to adhere to the Quoted Company Alliance’s (“QCA”) Corporate
Governance Code to meet the mew requirements of AIM Rule 26. It is the commitment of the
Board to manage the Company’s affairs in accordance with this Code, in so far as is practical
and appropriate for a public company of this size and complexity. The Board has disclosed the
Corporate Governance Statement on its website how the Company complies with the 10
principles of the QCA Code. The following are a few examples on how the Directors have
applied the principles of good corporate governance to manage the Company throughout the
year.
Board of Directors
The QCA Code requires that the boards of AIM companies have an appropriate balance
between executive and non-executive directors. The Company has strengthened the board and
has satisfied this requirement by appointing Mr. Ivor Colin SHRAGO as independent non-
executive director on 27 September 2018.
The Board directs and controls the Company and is responsible for strategy and operating
performance. It meets regularly throughout the year and has adopted a schedule of matters
specifically reserved for its decision.
All Directors are elected by shareholders at the first opportunity after their initial appointment
to the Board and to be re-elected thereafter at intervals of not more than three years.
Biographical information on all the Directors is listed in the Directors’ and Senior
Management’s Biographies section to the annual report, which may help the shareholders to
make a decision at the time of re-election.
Upon their appointments, the Directors are offered an opportunity to request information and
training relevant to their legal and other duties. They are also given written guidelines and rules
defining their responsibilities within an AIM listed company.
The Board considers that all Non-executive Directors are independent of management and day
to day operation, and free from any commercial relationship with the Company. These Non-
executive Directors do not participate in any of the Company’s pension schemes or bonuses.
The Chairman of the Audit and Remuneration Committees is a Non-executive Director.
Nomination Committee
As the Board of Directors of the Company is relatively small, there is no separate Nomination
Committee. All nominations to the Board are considered by all of the Directors.
UNIVISION ENGINEERING LIMITED - 19 - ANNUAL REPORT 2021
REPORT ON CORPORATE GOVERNANCE
(Continued)
Audit Committee
Our Audit Committee comprises Mr. Nicholas James LYTH (our Non-executive Director), Mr.
Ivor Colin SHRAGO (our Non-executive Director) and Mr. Stephen Sin Mo KOO (our Executive
Chairman) and is chaired by Mr. Nicholas James LYTH. The Chairman of the Audit Committee
has full discretion to invite any Executive Directors to attend its meetings. The Audit Committee
meets not less than twice per year.
The responsibilities of the Committee are to:
- monitor the quality of the overall internal control system of all financial matters;
-
-
-
-
-
-
review the Company’s Accounting Policies and ensure compliance with accounting standards;
ensure that the financial performance of the Company is properly measured and reported on;
consider the appointment/re-appointment of the external auditor;
review the conduct of the audit and discuss the audit fee;
review reports from the Auditors relating to the Company’s accounting and internal controls;
to ensure the Company complies with the AIM Rules.
Remuneration Committee
Our Remuneration Committee comprises Mr. Ivor Colin SHRAGO (our Non-executive Director),
Mr. Nicholas James LYTH (our Non-executive Director) and Mr. Stephen Sin Mo KOO (our
Executive Chairman) and is chaired by Mr. Ivor Colin SHRAGO. The Remuneration Committee
meets as required.
determine the specific remuneration package for each Director including Director’s fees,
The responsibilities of the Committee are to:
-
salaries, allowances, bonuses, options, benefits-in-kind; and
-
correctly fulfil its duties, as the Committee deems appropriate.
seek for professional advice, including comparison with similar businesses, in order to
In discharging its functions, the Committee may obtain independent external legal and other
professional advices as it deems necessary. The expense of such advice shall be borne by the
Company.
UNIVISION ENGINEERING LIMITED - 20 - ANNUAL REPORT 2021
REPORT ON CORPORATE GOVERNANCE
(Continued)
Internal Control
The Board of Directors is responsible for ensuring that the Company maintains an internal
financial control system with appropriate monitoring procedures. The purpose of this system is to
safeguard Company assets, maintain proper accounting records, and ensure that reliable financial
information is used within the Company and for publication purposes. However, the system is
designed to manage rather than completely eliminate risk and can only provide reasonable but not
absolute assurance against material misstatement.
In order to achieve the above responsibilities, the Board meets regularly and monitors the
Company’s internal financial control by reviewing the process and the performance of the
systems, setting annual budgets and periodic forecasts, and seeking any prior approval for all
significant expenditure.
The Company currently does not have an internal audit department and after extensive review and
consideration, the Board has concluded that the existing control mechanisms are sufficient for the
size of the Company. This decision will be kept under review.
Going Concern
After making appropriate enquiries, the Directors have a reasonable expectation that the Company
has adequate resources to continue in operational existence for the foreseeable future. For this
reason, they continue to adopt the going concern basis in preparing the Company’s financial
statements.
Investor Relations
The Company realises that effective communication can increase transparency and accountability
to its shareholders; as such, the Company discloses its information to its shareholders through
RNS (i.e. the news distribution service operated by the London Stock Exchange plc). The same
information can also be found on the Company’s website (www.uvel.com). The Company will
make every effort to ensure that all price-sensitive information is released publicly and
immediately. If an immediate announcement is not possible, the Company will try to publicize
the information at the earliest time possible to ensure that the shareholders and the public have
fair access to it.
The Company will send the Annual Report and the notice of the Annual General Meeting (AGM)
to all its shareholders. This notice is also made available on RNS. The Company recognises the
importance of the shareholders’ views and encourages them to attend the AGMs where they can
share their opinions and raise direct queries and concerns towards the Directors, including the
chairperson of each of the Board Committees. The shareholders are also welcomed to discuss any
issues on an informal basis at the conclusion of the AGMs.
UNIVISION ENGINEERING LIMITED - 21 - ANNUAL REPORT 2021
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the financial statements in
accordance with applicable law and regulations.
The Directors are responsible for preparing financial statements for each financial year. The
Directors have elected to prepare the Company’s financial statements in accordance with
International Financial Reporting Standards (IFRSs). The Directors must not approve the
financial statements unless they give a true and fair view of the state of affairs of the Company
and of the profit or loss 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 IFRSs accounting standards have been followed, subject to any
material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to
presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to
show and explain the Company’s transaction and disclose with reasonable accuracy at any time
the financial position of the Company. They have general responsibility for taking such steps as
are reasonably available to them to safeguard the assets of the Company and hence for taking
reasonable steps for prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial
information included in the Company’s website. The Company is compliant with AIM Rule 26
regarding the Company’s website.
UNIVISION ENGINEERING LIMITED - 22 - ANNUAL REPORT 2021
26/F, Citicorp Centre
18 Whitfield Road
Causeway Bay
Hong Kong
Independent auditor’s report
To the members of
UniVision Engineering Limited
(Incorporated in Hong Kong with limited liability)
Opinion
We have audited the financial statements of UniVision Engineering Limited (the “Company”) set out
on pages 29 to 62, which comprise the statement of financial position as at 31 March 2021, and the
statement of profit or loss and other comprehensive income, the statement of changes in equity and
the statement of cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies.
In our opinion, the financial statements give a true and fair view of the financial position of the
Company as at 31 March 2021, and of its financial performance and its cash flows for the year then
ended in accordance with International Financial Reporting Standards (“IFRSs”).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (“ISAs”). Our
responsibilities under those standards are further described in the “Auditor’s Responsibilities for the
Audit of the Financial Statements” section of our report. We are independent of the Company in
accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for
Professional Accountants (the “IESBA Code”), and we have fulfilled our other ethical responsibilities
in accordance with the IESBA Code. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
UNIVISION ENGINEERING LIMITED - 23 - ANNUAL REPORT 2021
Independent auditor’s report
To the members of
UniVision Engineering Limited
(Incorporated in Hong Kong with limited liability)
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial statements of the current year. 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.
Revenue recognition on service contracts from supply, design and installation of closed circuit
television and surveillance systems
Key audit matter
How our audit addressed the key audit matter
We identified the revenue recognition on service
contracts from the supply, design and installation
of closed circuit television and surveillance
systems as a key audit matter due to the
significant judgments exercised by the
management in determining the total contract
costs and contract costs incurred for work
performed to date.
As set out in note 4 to the financial statements,
the Company recognises service revenue by
reference to the progress towards complete
satisfaction of the relevant performance
obligation using input method, measured based
on the proportion of contract costs incurred for
work performed to date relative to the estimated
total contract costs. This revenue recognition
involves a significant degree of management
estimates and judgement, with estimates being
made to assess the total contract costs and stage
of completion of the contract.
As disclosed in note 7 to the financial
statements, the Company recorded revenue from
the provision of construction works of
£9,048,983 for the year ended 31 March 2021.
Our procedures in relation to the Company’s
revenue recognition on service contracts
included:
Understood the management’s process
relating to the estimation of total contract
costs and recording of costs;
Obtained an understanding from the
Company’s project team about the
contract terms, performance and status of
selected contracts to evaluate the
reasonableness of the basis of estimation
of the total contract costs, and contract
costs incurred for work performed to date;
Performed comparisons between the
percentage of completion and the
percentage of progress billing on selected
contracts to identify and investigate any
significant differences by obtaining an
understanding from project team and
checking correspondence with customers
of the Company; and
Checked the progress billings, on a
sample basis, to invoices issued and
checked contract costs incurred, on a
sample basis, to invoices received and
human resources record respectively.
UNIVISION ENGINEERING LIMITED - 24 - ANNUAL REPORT 2021
Independent auditor’s report
To the members of
UniVision Engineering Limited
(Incorporated in Hong Kong with limited liability)
Key Audit Matters (Continued)
Estimated provision of expected credit losses (“ECL”) for receivables measured at amortised cost
and contract assets
Key audit matter
How our audit addressed the key audit matter
We identified the estimated provision of ECL for
receivables measured at amortised cost and
contract assets as a key audit matter due to the
significance of these assets to the Company’s
financial statements and the involvement of
subjective judgement and management estimates
in evaluating the ECL.
As at 31 March 2021, the Company’s trade
receivables, other receivables, contract assets
and amounts due from related companies are
£343,911, £1,198,861, £8,439,488 and
£2,842,805 respectively.
Our procedures in relation to estimated
provision of ECL for receivables measured at
amortised cost and contract assets included:
Understood and assessed the effectiveness
of related key internal control design in
relation to the credit approval and
impairment loss allowances;
Assessed the recoverability of a sample of
outstanding balances by reviewing the
historical patterns of receipts, customers’
ability to repay and ageing analyses,
arranging circularisation and assessing
cash received subsequent to year end;
Assessed management’s provision policy
for ECL on receivables and contract
assets by selecting samples and:
- noting the historical repayment
patterns;
- assessing cash received subsequent to
year end;
- evaluating the plans for recovering the
outstanding balances, such as
realisation of the pledged assets and
enforcement of guarantees;
- questioning management’s knowledge
of future conditions that may impact
the expected customer receipts;
reviewing and verifying the ageing
analyses and the related provisions;
and
-
- performing overall analytics on the
reasonableness of the impairment
provisions.
UNIVISION ENGINEERING LIMITED - 25 - ANNUAL REPORT 2021
Independent auditor’s report
To the members of
UniVision Engineering Limited
(Incorporated in Hong Kong with limited liability)
Other Information
The directors are responsible for the other information which comprises the information included in
the Company’s annual report for the year ended 31 March 2021 other than the financial statements
and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and 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, based on the work we have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Directors for the Financial Statements
The directors are responsible for the preparation of the financial statements that give a true and fair
view in accordance with IFRSs and for such internal control as the directors determine is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Company’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to liquidate the Company or to
cease operations, or have no realistic alternative but to do so.
The directors are assisted by the Audit Committee in discharging their responsibilities for overseeing
the Company’s financial reporting process.
UNIVISION ENGINEERING LIMITED - 26 - ANNUAL REPORT 2021
Independent auditor’s report
To the members of
UniVision Engineering Limited
(Incorporated in Hong Kong with limited liability)
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 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.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
-
-
-
-
-
Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations,
or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
We communicate with the Audit Committee regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
UNIVISION ENGINEERING LIMITED - 27 - ANNUAL REPORT 2021
Independent auditor’s report
To the members of
UniVision Engineering Limited
(Incorporated in Hong Kong with limited liability)
Auditor’s Responsibilities for the Audit of the Financial Statements (cont’d)
We also provide the Audit Committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated with the Audit Committee, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Use of Report
This report is made solely to the Company’s members, as a body, in compliance with the AIM Rules
for companies as published by the London Stock Exchange Group plc. 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’s members as a body, for our audit
work, for this report or for the opinion we have formed.
The engagement director on the audit resulting in this independent auditor’s report is Lam Kar Bo
(Practising Certificate Number : P05453).
PKF Hong Kong Limited
Certified Public Accountants
Hong Kong
Hong Kong, China
6 September 2021
UNIVISION ENGINEERING LIMITED - 28 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the year ended 31 March 2021
Revenue
Cost of revenue
Gross profit
Other income
Other gains and losses, net
Selling and distribution expenses
Administrative expenses
Finance costs
Profit before income tax
Income tax
Profit for the year
Other comprehensive (loss)/income, net of tax
Item that may be reclassified subsequently to profit or loss:
Exchange differences on translation of financial statements
Notes
7(a)
10
8
9
10
10
12
13
2021
£
2020
£
10,945,287
(8,986,278)
10,728,544
(8,647,222)
1,959,009
422,560
(33,476)
(4,570)
(1,706,160)
(74,009)
563,354
-
2,081,322
36,905
(11,049)
(30,503)
(1,529,749)
(95,243)
451,683
-
563,354
451,683
(901,758)
548,560
Total comprehensive (loss)/income for the year
(338,404)
1,000,243
Earnings per share – Basic and Diluted
14
0.15p
0.12p
UNIVISION ENGINEERING LIMITED - 29 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
STATEMENT OF FINANCIAL POSITION
As at 31 March 2021
ASSETS
Non-current assets
Plant and equipment
Right-of-use assets
Interest in an associate
Amounts due from related companies
Deposit placed for a life insurance policy
Prepayments
Total non-current assets
Current assets
Inventories
Trade and other receivables
Contract assets
Cash and bank balances
Total current assets
Total assets
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables
Contract liabilities
Bank borrowings
Lease liabilities
Total current liabilities
Non-current liabilities
Amount due to a related company
Lease liabilities
Total non-current liabilities
Total liabilities
Capital and reserves
Share capital
Reserves
Total equity
Total liabilities and equity
Notes
2021
£
2020
£
16
17
18
30
19
20
21
22
23
24
25
27
26
24
26
28
99,014
61,092
5
2,842,805
862,476
48,981
135,121
276,119
-
3,157,799
941,772
76,017
3,914,373
4,586,828
1,584,096
1,708,489
8,439,488
284,354
1,034,289
2,406,863
6,243,276
980,238
12,016,427
10,664,666
15,930,800
15,251,494
5,179,172
1,572,245
561,535
42,959
3,824,759
1,316,446
682,486
213,288
7,355,911
6,036,979
393,074
21,924
414,998
437,500
70,877
508,377
7,770,909
6,545,356
3,890,257
4,269,634
3,890,257
4,815,881
8,159,891
8,706,138
15,930,800
15,251,494
The financial statements on pages 29 to 62 were authorised for issue by the board of directors on 6 September 2021
and were signed on its behalf by:
Stephen Sin Mo KOO, Director
Yip Tak CHAN, Director
UNIVISION ENGINEERING LIMITED - 30 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2021
Share
capital
£
Retained
earnings
£
Special
capital
reserve “A”
£
(Note 1)
Special
capital
reserve “B”
£
(Note 2)
Translation
reserve
£
Total
£
Balance at 1 April 2019
3,890,257
2,211,100
155,876
143,439
1,517,670
7,918,342
Profit for the year
Other comprehensive income, net of tax
Exchange difference arising on translation of
financial statements
Total comprehensive income
Dividend paid in respect of year 2019 (Note 15)
Total transactions with owners, recognised
directly in equity
-
-
-
-
-
451,683
-
451,683
(212,447)
(212,447)
-
-
-
-
-
-
-
-
-
-
-
451,683
548,560
548,560
548,560
1,000,243
-
-
(212,447)
(212,447)
Balance at 31 March 2020
3,890,257
2,450,336
155,876
143,439
2,066,230
8,706,138
Profit for the year
Other comprehensive loss, net of tax
Exchange difference arising on translation of
financial statements
Total comprehensive loss
Dividend paid in respect of year 2020 (Note 15)
Total transactions with owners, recognised
directly in equity
-
-
-
-
-
563,354
-
563,354
(207,843)
(207,843)
-
-
-
-
-
-
-
-
-
-
-
563,354
(901,758)
(901,758)
(901,758)
(338,404)
-
-
(207,843)
(207,843)
Balance at 31 March 2021
3,890,257
2,805,847
155,876
143,439
1,164,472
8,159,891
The currency translation from Hong Kong dollar to the presentation currency of Sterling Pound of these financial
statements has no impact on the available distributable reserves of the Company as at 31 March 2021.
Notes:
1.
Special capital reserve “A”
Pursuant to the Order of the High Court dated 20 November 2004, any future recoveries of the Company’s
accumulated provision for obsolete inventories and provision for bad debts amounting to HK$1,935,002 and
HK$3,592,540 respectively will be credited to non-distributable special capital reserve “A” account.
2.
Special capital reserve “B”
By a special resolution passed on 30 July 2004 and pursuant to the Order of the High Court dated 20
November 2004, the authorised and issued capital of the Company was reduced from HK$159,245,000
(divided into 31,849 ordinary shares of HK$5,000 each) to HK$16,405,000 (divided into 3,281 ordinary
shares of HK$5,000 each). The reduction of capital was effected by cancellation of 28,568 ordinary shares of
HK$5,000 each in the issued and paid up share capital of the Company. The Company established a non-
distributable special capital reserve “B” account into which HK$2,071,307 was credited as a result of the
capital reduction.
UNIVISION ENGINEERING LIMITED - 31 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
STATEMENT OF CASH FLOWS
For the year ended 31 March 2021
Cash flows from operating activities
Profit before income tax
Adjustments for:
Interest expense on bills payable and factoring
Interest expense on bank borrowings
Interest expense on bank overdraft
Interest on lease liabilities
Interest income
Depreciation of plant and equipment
Depreciation of right-of-use assets
Inventories written-off
Gain on lease modification
Gain on disposal of plant and equipment
Operating cash flows before working capital changes
Changes in operating assets and liabilities:
Prepayments and deposit
Inventories
Trade and other receivables
Contract assets
Amounts due from related companies
Trade and other payables
Contract liabilities
Notes
2021
£
2020
£
12
12
12
12
8
16
17
9
8
9
35
563,354
451,683
49,479
12,805
4,682
7,043
(26,773)
55,607
173,933
32,787
(122)
-
61,501
21,205
-
12,537
(36,905)
56,694
179,977
-
-
(201)
872,795
746,491
(17,191)
(721,932)
640,552
(2,978,477)
(5,959)
1,834,113
409,884
25,731
(336,416)
37,560
(2,341,199)
378,665
1,093,686
284,685
Net cash generated from/(used in) operating activities
33,785
(110,797)
Cash flows from investing activities
Interest received
Purchase of plant and equipment
Investment in an assoicate
Proceeds from disposal of plant and equipment
Deposit placed for a life insurance policy
8
26,773
(32,048)
(5)
-
-
36,905
(39,498)
-
201
(910,199)
Net cash used in investing activities
(5,280)
(912,591)
Cash flows from financing activities
Bank interest paid
Dividend paid to shareholders of the Company
Repayment of bank loans
New bank loans
Capital element of lease liabilities paid
Interest element of lease liabilities paid
12
15, 35
31
31
31
31
(66,966)
(65,653)
(54,355)
-
(177,430)
(7,043)
(82,706)
(67,109)
-
659,606
(172,201)
(12,537)
Net cash (used in)/generated from financing activities
(371,447)
325,053
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effect of foreign exchange rate changes, net
(342,942)
679,186
(51,890)
(698,335)
1,312,211
65,310
Cash and cash equivalents at end of year
23
284,354
679,186
UNIVISION ENGINEERING LIMITED - 32 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
1.
GENERAL INFORMATION
UniVision Engineering Limited (the “Company”) is incorporated in Hong Kong with limited liability and its
shares are listed on the AIM of the London Stock Exchange. The address of the Company’s registered office is
Unit 201, 2/F., Sunbeam Centre, 27 Shing Yip Street, Kwun Tong, Kowloon, Hong Kong.
These financial statements are presented in Sterling Pound (“£”), which is the presentation currency of the
Company.
The Company is mainly engaged in the supply, design, installation and maintenance of closed circuit television
and surveillance systems and the sale of security system related products in Hong Kong.
2.
BASIS OF PREPARATION
These financial statements have been prepared in accordance with International Financial Reporting Standards
(“IFRSs”) issued by the International Accounting Standards Board. The measurement basis used in the
preparation of these financial statements is the historical cost basis.
The preparation of financial statements in conformity with IFRSs requires management to make judgements,
estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities,
income and expenses. The estimates and associated assumptions are based on historical experience and various
other factors that are believed to be reasonable under the circumstances, the results of which form the basis of
making the judgements about carrying values of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised if the revision affects only that period, or in the
period of the revision and future periods if the revision affects both current and future periods. Judgements made
by management in the application of IFRSs that have significant effect on the financial statements and key
sources of estimation uncertainty are discussed in note 5 to the financial statements.
3.
APPLICATION OF NEW AND REVISED IFRSs
(a)
Initial application of IFRSs
In the current year, the Company initially applied the following IFRSs:
Amendments to IFRS 3
Amendments to IAS 1 and IAS 8
Amendments to IFRS 9, IAS 39
and IFRS 7
Conceptual Framework for
Financial Reporting 2018
Definition of a Business
Definition of Material
Interest Rate Benchmark Reform
Revised Conceptual Framework for Financial Reporting
The initial application of these financial reporting standards does not necessitate material changes in the
Company’s accounting policies and retrospective adjustments of the comparatives presented in these
financial statements.
UNIVISION ENGINEERING LIMITED - 33 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
3.
APPLICATION OF NEW AND REVISED IFRSs
(b)
IFRSs in issue but not yet effective
The following IFRSs in issue at 31 March 2021 have not been applied in the preparation of these
financial statements since they were not yet effective for the annual period beginning on 1 April 2020:
IFRS 17
Amendments to IFRS 3
Amendments to IAS 16
Amendments to IAS 37
Amendments to IAS 39, IFRS 4,
IFRS 7, IFRS 9 and IFRS 16
Annual Improvements to IFRSs
2018-2020 Cycle
Amendments to IFRS 16
Amendments to IAS 1
Amendments to IFRS 10 and
IAS 28
Insurance Contracts2
Definition of Business2
Property, Plant and Equipment: Proceeds before Intended
Use2
Onerous Contracts - Cost of Fulfilling a Contract2
Interest Rate Benchmark Reform - Phase 22
Revised Conceptual Framework for Financial Reporting2
COVID-19-Related Rent Concession1
Classification of Liabilities as Current or Non-current3
Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture4
1
2
3
4
Effective for the Company’s annual financial statements beginning on 1 April 2021
Effective for the Company’s annual financial statements beginning on 1 April 2022
Effective for the Company’s annual financial statements beginning on 1 April 2023
Effective for the annual periods beginning on or after a date to be determined
The Company is in the process of making an assessment of what the impact of these amendments, new
standards and interpretations is expected to be in the period of initial application.
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
4.1
Segment reporting
An operating segment is a component of the Company that engages in business activities from which it may earn
revenue and incurs expenses, including revenue and expenses that relate to transactions with other components
of the Company. Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decision-maker.
4.2
Foreign currency
Functional and presentation currency
Items included in the financial statements of the Company are measured using the currency of the primary
economic environment in which the Company operates (the “functional currency”), which is Hong Kong Dollar
(“HK$”). These financial statements are presented in Sterling Pound (“£”), which is the Company’s presentation
currency. As the Company is listed on the AIM, the directors consider that this presentation is more useful for its
current and potential investors.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at
the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses
resulting from the settlement of such transactions and from the translation at year-end exchange rates of
monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss, except when
deferred in other comprehensive income as qualifying cash flow hedges and qualifying net investment hedges.
UNIVISION ENGINEERING LIMITED - 34 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.3
Plant and equipment
Plant and equipment are initially recognised at cost and subsequently carried at cost less accumulated
depreciation and accumulated impairment loss. The cost of an asset comprises its purchase price and any
directly attributable costs of bringing the asset to working condition for its intended use.
On disposal of an item of plant and equipment, the difference between the net disposal proceeds and its carrying
amount is taken to profit or loss.
Depreciation is calculated using the straight-line method to allocate their depreciable amounts over the estimated
useful lives as follows:
Furniture and fixtures
Computer equipment
Motor vehicles
3 - 5 years
2 - 5 years
3 years
Fully depreciated plant and equipment are retained in the financial statements until the items are no longer in
use.
The residual values, useful lives and depreciation method are reviewed at the end of each reporting period to
ensure that the amount, method and period of depreciation are consistent with previous estimates and the
expected pattern of consumption of the future economic benefits embodied in the items of plant and equipment.
The effects of any revision are recognised in profit or loss when the changes arise.
Subsequent expenditure relating to plant and equipment that has already been recognised is added to the carrying
amount of the asset only when it is probable that future economic benefits associated with the item will flow to
the Company and the cost of the item can be measured reliably. All other repair and maintenance expenses are
recognised in profit or loss when incurred.
4.4
Interest in an associate
Associate is an entity in which the Company has significant influence, but not control or joint control, over its
management, including participation in the financial and operating policy decisions.
The results and assets and liabilities of the associate are incorporated in these financial statements using the
equity method of accounting. Under the equity method, interest in an associate is initially recorded at cost,
adjusted for any excess of the Company’s share of the acquisition-date fair values of the investee’s identifiable
net assets over the cost of the investment. The cost of the investment includes purchase price, other costs directly
attributable to the acquisition of the investment, and any direct investment into the associate that forms part of
the Company’s equity investment. Thereafter, the investment is adjusted for post-acquisition changes in the
Company’s share of e investee’s net assets and any impairment loss relating to the investment. When the
Company’s share of losses of the associates equals or exceeds its interest in that associate (which includes any
long-term interests that, in substance, form part of the Company’s net investments in the associates), the
Company discontinues recognising its share of further losses. An additional share of losses is provided for and a
liability is recognised only to the extent that the Company has incurred legal or constructive obligations or made
payments on behalf of that associate.
Unrealised profits and losses resulting from transactions between the Company and its associates are eliminated
to the extent of the Company’s interest in the investee, except where unrealised losses provide evidence of an
impairment of the asset transferred, in which case they are recognised immediately in profit or loss.
4.5
Impairment of non-financial assets
The carrying amounts of non-current assets, including plant and equipment and right-of-use assets, are reviewed
at the end of each reporting period to determine whether there is any indication of impairment. If any such
indication exists, the recoverable amount is estimated.
UNIVISION ENGINEERING LIMITED - 35 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.5
Impairment of non-financial assets (cont’d)
Calculation of recoverable amount
The recoverable amount of an asset is the greater of its fair value less costs of disposal 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. Where an asset does not generate cash inflows largely independent of those from other assets, the
recoverable amount is determined for the smallest group of assets that generates cash inflows independently (i.e.
a cash-generating unit).
Recognition of impairment losses
An impairment loss is recognised in profit or loss if the carrying amount of an asset, or the cash-generating unit
to which it belongs, exceeds the recoverable amount. Impairment losses recognised in respect of cash-generating
units are allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit (or
group of units) and then, to reduce the carrying amount of the other assets in the unit (or group of units) on a pro
rata basis, except that the carrying value of an asset will not be reduced below its individual fair value less costs
of disposal (if measurable) or value in use (if determinable).
Reversals of impairment losses
An impairment loss is reversed if there has been a favourable change in the estimates used to determine the
recoverable amount. A reversal of an impairment loss is limited to the asset’s carrying amount that would have
been determined had no impairment loss been recognised in prior years. Reversals of impairment losses are
credited to profit or loss in the year in which the reversals are recognised.
4.6
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted
average method and comprises design costs, raw materials, direct labour, other direct costs and other costs
incurred in bringing the inventories to their present location and condition. Net realisable value is the estimated
selling price in the ordinary course of business less the estimated costs of completion and the estimated costs
necessary to make the sale.
4.7
Financial instruments
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual
provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value except for trade receivables arising
from contracts with customers which are initially measured in accordance with IFRS 15. Transaction costs that
are directly attributable to the acquisition or issue of financial assets and financial liabilities are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition.
4.7.1 Financial assets
Classification and subsequent measurement of financial assets
Financial assets that meet the following conditions are subsequently measured at amortised cost:
-
-
the financial asset is held within a business model whose objective is to collect contractual cash flows; and
the contractual terms give rise on specified dates to cash flows that are solely payments of principal and
interest on the principal amount outstanding.
All other financial assets are subsequently measured at fair value through profit or loss.
UNIVISION ENGINEERING LIMITED - 36 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.7
Financial instruments (cont’d)
4.7.1 Financial assets (cont’d)
Impairment of financial assets
The Company recognises a loss allowance for ECL on financial assets and other assets which are subject to
impairment under IFRS 9. The amount of ECL is updated at each reporting date to reflect changes in credit risk
since initial recognition.
Lifetime ECL represents the ECL that will result from all possible default events over the expected life of the
relevant instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result
from default events that are possible within 12 months after the reporting date. Assessments are done based on
the Company’s historical credit loss experience, adjusted for factors that are specific to the debtors, general
economic conditions and an assessment of both the current conditions at the reporting date as well as the
forecast of future conditions.
The Company always recognises lifetime ECL for trade receivables and contract assets. The ECL on these assets
is assessed individually for debtors with significant balances and/or collectively using a provision matrix with
appropriate groupings. For all other instruments, the Company measures the loss allowance equals to 12-month
ECL, unless when there has been a significant increase in credit risk since initial recognition, the Company
recognises lifetime ECL. The assessment of whether lifetime ECL should be recognised is based on significant
increases in the likelihood or risk of a default occurring since initial recognition.
In assessing whether the credit risk of a financial instrument has increased significantly since initial recognition,
the Company compares the risk of default occurring on the financial instrument assessed at the reporting date
with that assessed at the date of initial recognition. In making this reassessment, the Company considers that a
default event occurs when (i) the borrower is unlikely to pay its credit obligations to the Company in full,
without recourse by the Company to actions such as realising security (if any is held); or (ii) the financial asset is
90 days past due. The Company considers both quantitative and qualitative information that is reasonable and
supportable, including historical experience and forward-looking information that is available without undue
cost or effort.
In particular, the following information is taken into account when assessing whether credit risk has increased
significantly since initial recognition:
-
-
-
-
failure to make payments of principal or interest on their contractually due dates;
an actual or expected significant deterioration in a financial instrument’s external or internal credit rating
(if available);
an actual or expected significant deterioration in the operating results of the debtor; and
existing or forecast changes in the technological, market, economic or legal environment that have a
significant adverse effect on the debtor’s ability to meet it obligation to the Company.
Depending on the nature of the financial instruments, the assessment of a significant increase in credit risk is
performed on either an individual basis or a collective basis. When the assessment is performed on a collective
basis, the financial instruments are grouped based on shared credit risk characteristics, such as past due status
and credit risk ratings.
ECLs are re-measured at each reporting date to reflect changes in the financial instrument’s credit risk since
initial recognition. Any change in the ECL amount is recognised as an impairment gain or loss in profit or loss.
The Company recognises an impairment gain or loss for all financial instruments with a corresponding
adjustment to their carrying amount through a loss allowance account, except for investments in debts securities
that are measured at fair value through other comprehensive income (recycling), for which the loss allowances
are recognised in other comprehensive income and accumulated in the fair value reserve (recycling).
Interest income is calculated based on the gross carrying amount of the financial asset unless the financial asset
is credit-impaired, in which case interest income is calculated based on the amortised cost (i.e. the gross carrying
amount less loss allowance) of the financial asset.
UNIVISION ENGINEERING LIMITED - 37 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.7
Financial instruments (cont’d)
4.7.1 Financial assets (cont’d)
Impairment of financial assets (cont’d)
At each reporting date, the Company assesses whether a financial asset is credit-impaired. A financial asset is
credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of
the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following
observable events:
-
-
-
-
-
significant financial difficulties of the debtor;
a breach of contract, such as a default or delinquency in interest or principal payments;
it becoming probable that the borrower will enter into bankruptcy or other financial reorganisation;
significant changes in the technological, market, economic or legal environment that have an adverse
effect on the debtor; or
the disappearance of an active market for a security because of financial difficulties of the issuer.
The gross carrying amount of a financial asset or contract asset is written off (either partially or in full) to the
extent that there is no realistic prospect of recovery. This is generally the case when the Company determines
that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the
amounts subject to the write-off.
Subsequent recoveries of an asset that was previously written off are recognised as a reversal of impairment in
profit or loss in the period in which the recovery occurs.
4.7.2 Financial liabilities and equity instruments
Debt and equity instruments issued by the Company are classified as either financial liabilities or as equity in
accordance with the substance of the contractual arrangements and the definitions of a financial liability and an
equity instrument.
Equity instrument
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting
all of its liabilities. Equity instruments issued by the Company are recognised at the proceeds received, net of
direct issue costs.
Financial liabilities
Financial liabilities are subsequently measured at amortised cost, using the effective interest method.
Effective interest method
The effective interest method is a method of calculating the amortised cost of a financial liability and of
allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts
estimated future cash payments (including all fees paid or received that form an integral part of the effective
interest rate, transaction costs and other premiums or discounts) through the expected life of the financial
liability or, where appropriate, a shorter period, to the net carrying amount on initial recognition. Interest
expense is recognised on an effective interest basis.
4.7.3 Derecognition
The Company derecognises a financial asset only when the contractual rights to the cash flows from the asset
expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the
asset to another entity.
UNIVISION ENGINEERING LIMITED - 38 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.7
Financial instruments (cont’d)
4.7.3 Derecognition (cont’d)
On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the
sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in
other comprehensive income and accumulated in equity is recognised in profit or loss.
The Company derecognises financial liabilities when, and only when, the Company’s obligations are discharged,
cancelled or expire. The difference between the carrying amount of the financial liability derecognised and the
consideration paid and payable is recognised in profit or loss.
4.7.4 Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the statement of financial position when
there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net
basis or realise the asset and settle the liability simultaneously.
4.8 Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand, demand deposits with banks and other financial
institutions, and short-term, highly liquid investments that are readily convertible into known amounts of cash
and which are subject to an insignificant risk of changes in value, having been within three months of maturity at
acquisition.
4.9 Dividend distributions
Dividend distributions to the Company’s shareholders are recognised as liabilities in the financial statements in
the period in which the dividends are approved by the shareholders or directors, where appropriate.
4.10 Revenue recognition
Revenue from contracts with customers
The Company recognises revenue when (or as) a performance obligation is satisfied, i.e. when “control” of the
goods or services underlying the particular performance obligation is transferred to the customer.
A performance obligation represents a good or service (or a bundle of goods or services) that is distinct or a
series of distinct goods or services that are substantially the same.
Control is transferred over time and revenue is recognised over time by reference to the progress towards
complete satisfaction of the relevant performance obligation if one of the following criteria is met:
-
-
-
the customer simultaneously receives and consumes the benefits provided by the Company’s performance
as the Company performs;
the Company’s performance creates or enhances an asset that the customer controls as the Company
performs; or
the Company’s performance does not create an asset with an alternative use to the Company and the
Company has an enforceable right to payment for performance completed to date.
Otherwise, revenue is recognised at a point in time when the customer obtains control of the distinct good or
service.
A contract asset represents the Company’s right to consideration in exchange for goods or services that the
Company has transferred to a customer that is not yet unconditional. It is assessed for impairment in accordance
with IFRS 9. In contrast, a receivable represents the Company’s unconditional right to consideration, i.e. only
the passage of time is required before payment of that consideration is due.
UNIVISION ENGINEERING LIMITED - 39 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.10 Revenue recognition (cont’d)
Revenue from contracts with customers (cont’d)
A contract liability represents the Company’s obligation to transfer goods or services to a customer for which
the Company has received consideration (or an amount of consideration is due) from the customer.
A contract asset and a contract liability relating to the same contract are accounted for and presented on a net
basis.
Contracts with multiple performance obligations (including allocation of transaction price)
For contracts that contain more than one performance obligations (provision of design and installation services
and sales of goods), the Company allocates the transaction price to each performance obligation on a relative
stand-alone selling price basis.
The stand-alone selling price of the distinct good or service underlying each performance obligation is
determined at contract inception. It represents the price at which the Company would sell a promised good or
service separately to a customer. If a stand-alone selling price is not directly observable, the Company estimates
it using appropriate techniques such that the transaction price ultimately allocated to any performance obligation
reflects the amount of consideration to which the Company expects to be entitled in exchange for transferring
the promised goods or services to the customer.
Over time revenue recognition: measurement of progress towards complete satisfaction of a performance
obligation
The progress towards complete satisfaction of a performance obligation is measured based on input method,
which is to recognise revenue on the basis of the Company’s efforts or inputs to the satisfaction of a
performance obligation relative to the total expected inputs to the satisfaction of that performance obligation,
that best depicts the Company’s performance in transferring control of goods or services.
Service revenue from supply, design and installation of closed circuit television and surveillance systems is
recognised over time by reference to the progress towards complete satisfaction of the relevant performance
obligation using input method as the Company’s performance does not create an asset with an alternative use to
the Company and the Company has an enforceable right to payment for performance completed to date.
Service revenue from maintenance contracts is recognised over time as the customer simultaneously receives
and consumes the benefits provided by the Company. Revenue is recognised on a straight-line basis because the
Company’s inputs are expended evenly throughout the performance period.
Trading income is recognised at a point in time when the customer obtains control of the distinct good.
4.11 Leases
At inception of a contract, the Company assesses whether the contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to control the use of an identified asset for a period of
time in exchange for consideration. Control is conveyed where the customer has both the right to direct the use
of the identified asset and to obtain substantially all of the economic benefits from that use.
As a lessee
Where the contract contains lease component(s) and non-lease component(s), the Company has elected not to
separate non-lease components and accounts for each lease component and any associated non-lease
components as a single lease component for all leases.
UNIVISION ENGINEERING LIMITED - 40 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.11 Leases (cont’d)
As a lessee (cont’d)
At the lease commencement date, the Company recognises a right-of-use asset and a lease liability, except for
short-term leases that have a lease term of 12 months or less and leases of low-value assets. When the Company
enters into a lease in respect of a low-value asset, the Company decides whether to capitalise the lease on a
lease-by-lease basis. The lease payments associated with those leases which are not capitalised are recognised as
an expense on a systematic basis over the lease term.
Where the lease is capitalised, the lease liability is initially recognised at the present value of the lease payments
payable over the lease term, discounted using the interest rate implicit in the lease or, if that rate cannot be
readily determined, using a relevant incremental borrowing rate. After initial recognition, the lease liability is
measured at amortised cost and interest expense is calculated using the effective interest method. Variable lease
payments that do not depend on an index or rate are not included in the measurement of the lease liability and
hence are charged to profit or loss in the accounting period in which they are incurred.
The right-of-use asset recognised when a lease is capitalised is initially measured at cost, which comprises the
initial amount of the lease liability plus any lease payments made at or before the commencement date, and any
initial direct costs incurred. Where applicable, the cost of the right-of-use assets also includes an estimate of
costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is
located, discounted to their present value, less any lease incentives received. The right-of-use asset is
subsequently stated at cost less accumulated depreciation (Note 17) and impairment losses.
The lease liability is remeasured when there is a change in future lease payments arising from a change in an
index or rate, or there is a change in the Company’s estimate of the amount expected to be payable under a
residual value guarantee, or there is a change arising from the reassessment of whether the Company will be
reasonably certain to exercise a purchase, extension or termination option. When the lease liability is remeasured
in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded
in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The Company presents right-of-use assets and lease liabilities separately in the statement of financial position.
4.12 Employee benefits
Employee benefits comprise short-term employee benefits and contributions to defined contribution retirement
plans.
Short-term employee benefits, including salaries, annual bonuses, paid annual leave and leave passage,
contributions to defined contribution retirement plans and the cost of non-monetary benefits are accrued in the
year in which the associated services are rendered by employees. Where payment or settlement is deferred and
the effect would be material, these amounts are stated at their present values.
Contributions to the defined contribution scheme are charged to profit or loss when incurred.
4.13 Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be
received and all attaching conditions will be complied with. When the grant related to an expense item, it is
recognised as income on a systematic basis over the periods that the costs, which it is intended to compensate,
are expensed.
Where the grant relates to an asset, the fair value is credited to a deferred income account and is released to
profit or loss over the expected useful life of the relevant asset by equal annual instalments or deducted from the
carrying amount of the asset and released to profit or loss by way of a reduced depreciation charge.
UNIVISION ENGINEERING LIMITED - 41 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.14
Income tax
Income tax expense for the year comprises current and deferred tax. Tax is recognised in the statement of profit
or loss and other comprehensive income, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the
end of the reporting period in the countries where the Company operates and generates taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable
tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities.
Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax
liabilities are not recognised if they arise from the initial recognition of goodwill; deferred income tax is not
accounted for if it arises from initial recognition of an asset or a liability in a transaction other than a business
combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred
income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of
the reporting period and are expected to apply when the related deferred income tax asset is realised or the
deferred income tax liability is settled.
Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be
available against which the temporary differences can be utilised.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income
taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where
there is an intention to settle the balances on a net basis.
4.15 Provisions and contingent liabilities
Provisions are recognised for other liabilities of uncertain timing or amount when the Company has a legal or
constructive obligation arising as a result of a past event, it is probable that an outflow of economic benefits will
be required to settle the obligation and a reliable estimate can be made. Where the time value of money is
material, provisions are stated at the present value of the expenditure expected to settle the obligation.
Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be
estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow is
remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of
one or more future events are also disclosed as contingent liabilities unless the probability of outflow is remote.
4.16 Events after the reporting period
Events after the reporting period that provide additional information about the Company at the end of the
reporting period or those that indicate the going concern assumption is not appropriate are adjusting events and
are reflected in the financial statements. Events after the reporting period that are not adjusting events are
disclosed in the notes to the financial statements when material.
UNIVISION ENGINEERING LIMITED - 42 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
4.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
4.17 Related parties
A person or a close member of that person’s family is related to the Company if that person:
(i)
(ii)
(iii)
has control or joint control over the Company;
has significant influence over the Company; or
is a member of the key management personnel of the Company or the Company’s parent.
An entity is related to the Company if any of the following conditions applies:
(i)
The entity and the Company are members of the same group (which means that each parent, subsidiary
and fellow subsidiary is related to the others).
(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a member
of a group of which the other entity is a member).
(iii) Both entities are joint ventures of the same third party.
(iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
(v)
The entity is a post-employment benefit plan for the benefit of employees of either the Company or an
entity related to the Company.
(vi) The entity is controlled or jointly controlled by a person identified in the above paragraph.
(vii) A person identified in (i) of the above paragraph has significant influence over the entity or is a member
of the key management personnel of the entity (or of a parent of the entity).
(viii) The entity, or any member of a group of which it is a part, provides key management personnel services
to the Company or to the Company’s parent.
Close members of the family of a person are those family members who may be expected to influence, or be
influenced by, that person in their dealings with the entity.
5.
KEY SOURCES OF ESTIMATION UNCERTAINTY
The following are the key assumptions concerning the future and other key sources of estimation uncertainty at
the end of the reporting period that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year.
Revenue recognition on service contracts
The Company recognises revenue on service contracts from supply, design and installation of closed circuit
television and surveillance systems by reference to the progress towards complete satisfaction of the relevant
performance obligation using the input method, measured based on the proportion of contract costs incurred for
work performed to date relative to the estimated total contract costs. The management regularly discusses with
the project team in order to review and revise the estimates of the total contract costs and stage of completion of
the work performed to date with reference to the performance and status of corresponding service contract work.
Accordingly, revenue recognition on service contracts involves a significant degree of management estimates
and judgment, with estimates being made to assess the total contract costs and contract costs incurred for work
performed to date.
The management reviews and revises the estimates of total contract costs and contract costs incurred for work
performed to date as the contract progresses, the actual outcome of the contract in terms of its total costs may be
higher or lower than the estimates and this will affect the revenue and profit recognised.
UNIVISION ENGINEERING LIMITED - 43 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
5.
KEY SOURCES OF ESTIMATION UNCERTAINTY (CONTINUED)
Estimated provision of ECL for receivables measured at amortised cost and contract assets
The management of the Company estimates the amount of impairment loss for ECL on receivables measured at
amortised cost and contract assets based on the credit risk of these assets. The amount of the impairment loss
based on ECL model is measured as the difference between all contractual cash flows that are due to the
Company in accordance with the contract and all the cash flows that the Company expects to receive, discounted
at the effective interest rate determined at initial recognition. Where the future cash flows are less than expected,
or being revised downward due to changes in facts and circumstances, a material impairment loss may arise.
The provision of ECL is sensitive to changes in estimates.
Income taxes
The Company is subject to profits tax in Hong Kong. Significant estimates are required in determining the
provision for income taxes. There are many transactions and calculations for which the ultimate tax
determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters
is different from the amounts that were initially recorded, such differences will impact the income tax and
deferred tax provisions in the period in which such determination is made.
As at 31 March 2021, the Company has unused tax losses of approximately £1,452,000 (2020: £1,838,000)
available for offset against future profits and no deferred tax asset has been recognised thereon. In cases where
there are future profits generated to utilise the tax losses, a material deferred tax asset may arise, which would be
recognised in the statement of profit or loss and other comprehensive income for the period in which such a
recognition takes place.
6.
FINANCIAL INSTRUMENTS
(a) Categories of financial instruments
Financial assets
Amounts due from related companies
Deposit placed for a life insurance policy
Trade and other receivables
Cash and bank balances
Financial liabilities
Trade and other payables
Amount due to a related company
Bank borrowings
Lease liabilities
2021
£
2,842,805
862,476
1,708,489
284,354
5,179,172
393,074
561,535
64,883
2020
£
3,157,799
941,772
2,406,863
980,238
3,824,759
437,500
682,486
284,165
(b)
Financial risk management objectives and policies
Details of the Company’s major financial instruments are disclosed in the respective notes. The risks
associated with these financial instruments include currency risk, interest rate risk, credit risk and
liquidity risk. The policies on how these risks are mitigated are set out below. The Company’s
management manages and monitors these exposures to ensure appropriate measures are implemented in a
timely and effective manner.
UNIVISION ENGINEERING LIMITED - 44 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
6.
FINANCIAL INSTRUMENTS (CONTINUED)
(b)
Financial risk management objectives and policies (continued)
(i) Market risk
Currency risk
The Company has foreign currency transactions and foreign currency denominated financial assets and
liabilities, which expose the Company to foreign currency risk.
The carrying amounts of the Company’s foreign currency denominated financial assets and liabilities at
the end of each reporting period are as follows:
Assets
2021
£
2020
£
Liabilities
2021
£
2020
£
Renminbi
United States dollar
5,178
869,314
5,323
948,100
571,306
598,596
568,750
1,023,750
The Company currently does not have any policy on hedges of foreign currency risk. However, the
management monitors the foreign currency risk exposure and will consider hedging significant foreign
currency risk should the need arise.
The following table details the Company’s sensitivity to a 5% increase and decrease in Sterling Pound
against the relevant foreign currencies with all other variables held constant. 5% (2020: 5%) is the
sensitivity rate used when reporting foreign currency risk internally to key management personnel and
represents management’s assessment of the reasonably possible change in foreign exchange rates. The
sensitivity analysis includes only outstanding foreign currency denominated financial instruments and
adjusts their translation at the end of the reporting period for a 5% (2020: 5%) change in foreign currency
rates.
Renminbi
Post-tax profit for the year
United States dollar
Post-tax profit for the year
Interest rate risk
2021
£
2020
£
29,796
29,654
14,248
3,982
The Company is exposed to fair value interest rate risk in relation to its bank deposits. The Company is
exposed to cash flow interest rate risk due to fluctuation of the prevailing market interest rate on bank
borrowings which carry interest at prevailing market interest rates as shown in notes 27 and 33 to the
financial statements.
The Company currently does not have an interest rate hedging policy. However, the management
monitors interest rate exposure and will consider hedging significant interest rate exposure should the
need arises.
The Company’s exposure to interest rates on financial liabilities is detailed in the liquidity risk
management section of this note.
UNIVISION ENGINEERING LIMITED - 45 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
6.
FINANCIAL INSTRUMENTS (CONTINUED)
(b)
Financial risk management objectives and policies (continued)
(i) Market risk (cont’d)
Interest rate risk (cont’d)
The sensitivity analysis below has been determined based on the change in interest rates and the exposure
to interest rates for the non-derivative financial liabilities at the end of the reporting period and on the
assumption that the amount outstanding at the end of the reporting period was outstanding for the whole
year and held constant throughout the financial year. The 25 basis points increase or decrease represents
the management’s assessment of a reasonably possible change in interest rates over the period until the
next fiscal year. The analysis is performed on the same basis for 2020.
For the year ended 31 March 2021, if interest rates had been 25 basis points higher/lower with all other
variables held constant, the Company’s post-tax profit for the year would increase/decrease by
approximately £4,584 (2020: £4,081).
(ii) Credit risk
At 31 March 2021, the Company’s maximum exposure to credit risk in the event of the counterparties’
failure to perform their obligations in relation to each class of recognised financial assets is the carrying
amount of those assets as stated in the statement of financial position.
In order to minimise credit risk, the management has a credit policy in place and the exposure to these
credit risks is monitored on an ongoing basis. Credit evaluations of the counterparties’ financial position
and conditions are performed on each and every major debtor periodically.
The Company measures ECLs for trade and other receivables and contract assets at an amount calculated
using a provision matrix, details of which are set out in notes 21 and 22 to the financial statements. At the
end of the reporting period, the Company had concentrations of credit risk where trade and other
receivables balance of the Company’s largest external customer exceeds 10% of the total trade and other
receivables at the end of the reporting period.
The credit risk on deposit placed for a life insurance policy and liquid funds is limited because the
counterparties are banks/financial institutions with high credit ratings assigned by international credit
rating agencies.
The Company’s exposure credit risk is considered limited.
(iii) Liquidity risk
The Company is responsible for its own cash management, including the raising of loans to cover the
expected cash demands. In managing liquidity risk, the Company’s policy is to regularly monitor current
and expected liquidity requirements and its compliance with lending covenants, to ensure that it
maintains sufficient reserves of cash and adequate committed funding lines from the financial institutions
to meet its liquidity requirements in the short and longer term. At 31 March 2021, the Company’s
banking facilities amounted to £5,292,641 (2020: £7,858,538) and the unused facilities were £3,458,873
(2020: £5,903,189).
The following table details the contractual maturities of the Company’s non-derivative financial liabilities
at the end of each reporting period, which is based on the undiscounted cash flows and the earliest date
on which the Company can be required to pay. The table includes both interest and principal cash flows.
UNIVISION ENGINEERING LIMITED - 46 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
6.
FINANCIAL INSTRUMENTS (CONTINUED)
(b)
Financial risk management objectives and policies (continued)
(iii) Liquidity risk (cont’d)
2021
Weighted
average
effective
interest rate
%
Within More than More than
1 year 1 year but 2 years but
or on
demand
£
less than
2 years
£
5 years
£
Carrying
amount
at 31
cash flow March 2021
£
£
Total
less than undiscounted
Trade and other payables
Amount due to a related
company
Bank borrowings
Lease liabilities
Nil
5,179,172
-
-
5,179,172
5,179,172
Nil
1.61
5.125
-
562,280
44,744
393,074
-
23,276
-
-
-
393,074
562,280
68,020
393,074
561,535
64,883
5,786,196
416,350
-
6,202,546
6,198,664
2020
Weighted
average
effective
interest rate
%
Within More than More than
1 year
1 year but 2 years but
or on
demand
£
less than
2 years
£
5 years
£
Carrying
amount
at 31
cash flow March 2020
£
£
Total
less than undiscounted
Trade and other payables
Amount due to a related
company
Bank borrowings
Lease liabilities
Nil
3,708,335
-
-
3,708,335
3,708,335
Nil
3.55
5.125
-
684,538
222,031
437,500
-
72,444
-
-
-
437,500
684,538
294,475
437,500
682,486
284,165
4,614,904
509,944
-
5,124,848
5,112,486
(c)
Fair value
The directors of the Company consider that the carrying amounts of financial assets and financial
liabilities recorded at amortised cost in these financial statements approximate their fair values at the end
of the reporting period.
(d) Capital risk management
The primary objectives when managing capital are to safeguard the Company’s ability to continue as a
going concern, so that it can continue to provide returns for shareholders and benefits for other
stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
The Company actively and regularly reviews and manages the capital structure to maintain a balance
between the higher shareholder returns that might be possible with a higher level of borrowings and the
advantages and security afforded by a sound capital position, and makes adjustments to the capital
structure in light of changes in economic conditions.
The Company monitors its capital structure on the basis of a net debt-to-adjusted capital ratio. For this
purpose, net debt is defined as total debt less bank deposits and cash and cash equivalents. Adjusted
capital comprises all components of equity less proposed dividends but not yet accrued.
The strategy during 2021, which is unchanged from 2020, is to maintain the net debt-to-adjusted capital
ratio as low as feasible. In order to maintain or adjust the ratio, the Company may adjust the amount of
dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce
debt.
UNIVISION ENGINEERING LIMITED - 47 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
6.
FINANCIAL INSTRUMENTS (CONTINUED)
(d) Capital risk management (cont’d)
The net debt-to-adjusted capital ratio of the Company at the end of the reporting period is as follows:
Total liabilities
Cash and bank balances
Net debt
Total equity
2021
£
2020
£
7,770,909
(284,354)
6,545,356
(980,238)
7,486,555
5,565,118
8,159,891
8,706,138
Net debt-to-adjusted capital ratio
92%
64%
7.
SEGMENT INFORMATION
Management has determined the operating segments based on the reports reviewed by the chief operating
decision maker, being the chief executive officer, that are used to make strategic decisions.
Information reported to the chief operating decision maker for the purpose of resource allocation and assessment
of segment performance focuses on types of goods or services delivered or provided. The Company has a single
reportable operating segment in security and surveillance business for the year ended 31 March 2021.
(a)
Segment revenues and results
The following is an analysis of the Company’s revenue and results by operating segment:
Segment revenue by major products and services
- Construction contracts
- Maintenance contracts
- Product sales
2021
£
9,048,983
1,650,094
246,210
2020
£
8,891,163
1,625,775
211,606
Revenue from contracts with customers and external customers
10,945,287
10,728,544
Segment profit
Finance costs
Profit before income tax
(b)
Information about major customers
637,363
(74,009)
546,926
(95,243)
563,354
451,683
Revenue of approximately £8,622,281 (2020: £8,812,800) is derived from one external customer (2020:
one customer), who contributed to 10% or more of the Company’s revenue in 2021 and 2020.
UNIVISION ENGINEERING LIMITED - 48 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
8.
OTHER INCOME
Interest income
Government grants - Note
Gain on lease modification
Sundry income
Note:
2021
£
26,773
392,936
122
2,729
422,560
2020
£
36,905
-
-
-
36,905
Government grants represent the approved amount of wage subsidies under the Employment Support Scheme
launched by the HKSAR Government and subsidies received from the Anti-Epidemic Fund of the HKSAR
Government.
9.
OTHER GAINS AND LOSSES, NET
Foreign exchange loss
Gain on disposal of plant and equipment
Inventories written-off
10. EXPENSES BY NATURE
Cost of inventories recognised as expenses
Sub-contracting costs
Depreciation – owned plant and equipment
Depreciation – right-of-use assets
Research and development costs
Selling and distribution cost
Short-term lease expenses
Other expenses
Staff costs, including directors’ remuneration
- Wages and salaries
- Pension scheme contributions
Auditor’s remuneration
- Audit services
2021
£
(689)
-
(32,787)
2020
£
(11,250)
201
-
(33,476)
(11,049)
2021
£
2020
£
5,975,575
1,341,994
55,607
173,933
-
3,189
86,680
437,568
2,494,170
102,388
2,596,558
5,709,694
1,185,287
56,694
179,977
23,875
2,709
54,411
453,342
2,415,640
99,379
2,515,019
25,904
26,466
Total cost of sales, selling and distribution, administrative expenses
10,697,008
10,207,474
UNIVISION ENGINEERING LIMITED - 49 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
11. DIRECTORS’ REMUNERATION
Directors’ remuneration for the year is as follows:
Executive directors
Stephen Sin Mo KOO
Peter Yip Tak CHAN
Keung Hung LI
Danny Kwok Fai YIP
Ivan Chi Hung CHAN
Non-executive directors
Nicholas James LYTH
Ivor Colin SHRAGO
Salaries,
bonuses and
allowances
£
Pension
scheme
contributions
£
-
79,555
49,384
74,317
49,800
253,056
14,183
14,183
28,366
-
1,773
1,330
1,773
1,330
6,206
-
-
-
2021
£
-
81,328
50,714
76,090
51,130
259,262
14,183
14,183
28,366
281,422
6,206
287,628
Messrs. Keung Hung LI and Ivan Chi Hung CHAN were appointed as the Company’s directors on 24 June 2020.
Executive directors
Stephen Sin Mo KOO
Peter Yip Tak CHAN
Chun Pan WONG
Danny Kwok Fai YIP
Mike Chiu Wah CHAN
Non-executive directors
Nicholas James LYTH
Ivor Colin SHRAGO
Salaries,
bonuses and
allowances
£
Pension scheme
contributions
£
-
74,399
74,410
72,108
51,472
272,389
14,497
14,497
28,994
-
1,812
1,359
1,812
1,057
6,040
-
-
-
2020
£
-
76,211
75,769
73,920
52,529
278,429
14,497
14,497
28,994
301,383
6,040
307,423
Messrs. Mike Chiu Wah CHAN and Chun Pun WONG resigned as the Company’s directors on 31 October 2019
and 26 December 2019 respectively.
12.
FINANCE COSTS
Interest expense on bills payable and factoring
Interest expense on bank borrowings
Interest expense on bank overdraft
Interest on lease liabilities
2021
£
49,479
12,805
4,682
7,043
74,009
2020
£
61,501
21,205
-
12,537
95,243
UNIVISION ENGINEERING LIMITED - 50 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
13.
INCOME TAX
(a)
Income tax in the statement of profit or loss and other comprehensive income
No provision for Hong Kong profits tax has been accrued in these financial statements as the Company
has unused tax losses brought forward to offset against its taxable profit for the year.
Reconciliation between income tax and profit before income tax is as follows:
Profit before income tax
Notional tax on profit before income tax, calculated at Hong
Kong profits tax rate of 16.5%
Tax effect of non-taxable income
Tax effect of non-deductible expenses
Tax effect of temporary differences not recognised
Utilisation of unrecognised tax losses
Income tax
(b) Deferred tax
2021
£
2020
£
563,354
451,683
92,953
(64,835)
13,133
(6,595)
(34,656)
74,528
(43)
10,918
(7,440)
(77,963)
-
-
At 31 March 2021, the Company’s significant temporary difference included unused tax losses of
£1,452,190 (2020: £1,838,451) available for offset against future taxable profits. No deferred tax asset
has been recognised due to the uncertainty of future profit streams.
Balance at beginning of year
Set-off against assessable profit for the year
Foreign exchange difference
2021
£
1,838,451
(210,035)
(176,226)
2020
£
2,178,697
(472,506)
132,260
Balance at end of year
1,452,190
1,838,451
No provision for deferred tax liabilities has been made in the financial statements as the tax effect of
temporary differences arising from depreciation allowances is immaterial to the Company.
14. EARNINGS PER SHARE
The calculation of basic earnings per share is based on the profit attributable to the equity shareholders of the
Company for the year of £563,354 (2020: £451,683), and the weighted average of 383,677,323 (2020:
383,677,323) ordinary shares in issue during the year.
There were no potential dilutive instruments at either financial year end.
UNIVISION ENGINEERING LIMITED - 51 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
15. DIVIDENDS
(i)
Dividends payable to equity shareholders of the Company attributable to the year:
Final dividend proposed after the reporting period of 0.26 HK
cents, equivalent to 0.0243 pence per ordinary share (2020: 0.55
HK cents, equivalent to 0.0573 pence, per ordinary share)
2021
£
2020
£
93,361
219,815
The final dividend proposed after the reporting period has not been recognised as a liability at the end of
the reporting period.
(ii) Dividends payable to equity shareholders of the Company attributable to the previous financial year,
approved and paid during the year
Final dividend in respect of the previous financial year, approved
and paid during the year, of 0.55 HK cents, equivalent to 0.05417
pence, per ordinary share (2020: 0.55 HK cents, equivalent to
0.05537 pence per ordinary share)
2021
£
2020
£
207,843
212,447
16.
PLANT AND EQUIPMENT
Cost
At 1 April 2019
Additions
Disposal
Foreign translation difference
At 31 March 2020
Additions
Foreign translation difference
Furniture
and fixtures
£
Computer
equipment
£
170,995
4,163
-
11,811
186,969
15,310
(19,747)
102,387
12,180
-
7,408
121,975
16,738
(13,220)
Motor
vehicles
£
95,700
23,155
(3,624)
7,207
122,438
-
(12,433)
Total
£
369,082
39,498
(3,624)
26,426
431,382
32,048
(45,400)
At 31 March 2021
182,532
125,493
110,005
418,030
Accumulated depreciation
At 1 April 2019
Charge for the year
Disposal
Foreign translation difference
At 31 March 2020
Charge for the year
Foreign translation difference
At 31 March 2021
Net book value
At 31 March 2021
At 31 March 2020
58,134
31,195
-
5,049
94,378
31,755
(11,165)
84,233
11,038
-
6,129
101,400
12,155
(10,901)
83,569
14,461
(3,624)
6,077
100,483
11,697
(10,786)
225,936
56,694
(3,624)
17,255
296,261
55,607
(32,852)
114,968
102,654
101,394
319,016
67,564
22,839
8,611
99,014
92,591
20,575
21,955
135,121
UNIVISION ENGINEERING LIMITED - 52 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
17. RIGHT-OF-USE ASSETS
Cost
At 1 April 2019
Additions
Foreign translation difference
At 31 March 2020
Additions
Expiry of lease arrangements
Lease modification
Foreign translation difference
Motor
vehicle
£
Leasehold
properties
£
-
-
-
-
35,163
-
-
(1,751)
280,492
157,254
24,593
462,339
-
(283,310)
(60,539)
(29,828)
Total
£
280,492
157,254
24,593
462,339
35,163
(283,310)
(60,539)
(31,579)
At 31 March 2021
33,412
88,662
122,074
Accumulated depreciation
At 1 April 2019
Charge for the year
Foreign translation difference
At 31 March 2020
Charge for the year
Expiry of lease arrangements
Lease modification
Foreign translation difference
At 31 March 2021
Net book value
At 31 March 2021
At 31 March 2020
-
-
-
-
5,861
-
-
(292)
5,569
-
179,977
6,243
186,220
168,072
(283,310)
(2,523)
(13,046)
-
179,977
6,243
186,220
173,933
(283,310)
(2,523)
(13,338)
55,413
60,982
27,843
33,249
61,092
-
276,119
276,119
The Company has entered into lease agreements to obtain the right to use motor vehicle and properties as its
office premises and warehouse and as a result incurred lease liabilities (Note 26). The leases typically run for an
initial period of 2 to 5 years.
18.
INTEREST IN AN ASSOCIATE
Cost of unlisted investment in an associate
Details of the Company’s associate at the end of the reporting period, are as follows:
2021
£
5
2020
£
-
Name of associate
Place of
establishment
and operation
Issued and
Proportion
paid-up of ownership
interest
capital
Proportion
of voting Principal
power held
activity
Vision Key International Limited
Hong Kong
HKD100
50%
50%
Inactive
The associate is inactive and the Company did not share any post-acquisition financial results of the associate
during the year.
UNIVISION ENGINEERING LIMITED - 53 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
19. DEPOSIT PLACED FOR A LIFE INSURANCE POLICY
In April 2019, the Company entered into a life insurance policy with an insurance company to insure Mr.
Stephen Sin Mo KOO, a Director of the Company. Under the policy, the Company is the beneficiary and policy
holder and the total insured sum is US$2,500,000. The Company has paid an upfront deposit of US$1,203,528.
The Company can terminate the policy at any time and receive cash back based on the cash value of the policy
at the date of withdrawal, which is determined by the upfront deposit payment of US$1,203,528 plus
accumulated interest earned and minus the accumulated insurance charge and policy expense charge (“Cash
Value”).
In addition, if withdrawal is made between the first to nineteenth policy year, as appropriate, a specified amount
of surrender charge would be imposed.
The insurance company will pay the Company an interest of 4.25% per annum on the outstanding Cash Value
for the first year. Commencing on the second year, the interest will be at least 2% guarantee interest per annum.
The guarantee interest rate is also the effective interest rate for the deposit placed on initial recognition,
determined by discounting the estimated future cash receipts through the expected life of the insurance policy,
excluding the financial effect of surrender charge.
The deposit placed is carried at amortised cost using the effective interest method. The Directors considered that
the possibility of terminating the policy during the first to nineteenth policy year was low and the expected life
of the insurance policy remained unchanged since the initial recognition. Accordingly, the difference between
the carrying amount of deposit placed for a life insurance policy as at 31 March 2021 and the Cash Value of the
life insurance policy is insignificant.
At 31 March 2021, the life insurance policy has been pledged as security for banking facilities granted to the
Company (Note 33).
20.
INVENTORIES
Raw materials
Finished goods
2021
£
279,261
1,304,835
2020
£
309,386
724,903
1,584,096
1,034,289
No provision for obsolete inventories is recognised for the year (2020: £nil) on slow-moving inventories.
Inventories write-off of £32,787 (2020: £nil) was recorded for the year.
21. TRADE AND OTHER RECEIVABLES
Trade receivables
Less: allowance for doubtful debts
Trade receivables, net
Other receivables
Deposits and prepayments
Total carrying amount
2021
£
403,230
(59,319)
343,911
1,198,861
165,717
2020
£
634,931
(66,024)
568,907
1,330,320
507,636
1,708,489
2,406,863
All of the trade and other receivables are expected to be recovered within one year.
UNIVISION ENGINEERING LIMITED - 54 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
21. TRADE AND OTHER RECEIVABLES (CONTINUED)
Trade receivables
Impairment losses in respect of trade receivables are recorded using an allowance account unless the Company
is satisfied that recovery of the amount is remote, in which case the impairment loss is written off against trade
receivables directly. Movements in the allowance for doubtful debts:
At beginning of year
Foreign translation difference
At end of year
2021
£
66,024
(6,705)
59,319
The ageing analysis of trade receivables, net at the end of the reporting period is as follows:
0 to 90 days
91 to 365 days
Over 365 days
2021
£
325,415
3,793
14,703
2020
£
61,806
4,218
66,024
2020
£
470,672
88,190
10,045
343,911
568,907
The Company measures loss allowances for trade receivables at an amount equals to lifetime ECLs, which is
calculated using a provision matrix. As the Company’s historical credit loss experience does not indicate
significantly different loss patterns for different customer segments, the loss allowance based on past due status
is not further distinguished between the Company’s different customer bases.
The following table provides information about the Company’s exposure to credit risk and ECLs for trade
receivables at the end of the reporting period:
2021
Gross
carrying
amount
£
Expected
loss rate
%
Loss
allowance
£
Expected
loss rate
%
2020
Gross
carrying
amount
£
Loss
allowance
£
0 to 90 days
91 to 365 days
Over 365 days
-
-
80
325,415
3,793
74,022
-
-
59,319
-
-
87
470,672
88,190
76,069
-
-
66,024
403,230
59,319
634,931
66,024
Expected loss rates are based on actual loss experience over the past 3 years. These rates are adjusted to reflect
differences between economic conditions during the periods over which the historic data has been collected,
current conditions and the Company’s view of economic conditions over the expected lives of the receivables.
Other receivables
The amount of £284,072 (2020: £406,007) included in other receivable is interest-free, repayable on demand and
due from Mr. Stephen Sin Mo KOO, a Director of the Company.
No loss allowance was recognised in profit or loss during the years ended 31 March 2021 and 2020.
UNIVISION ENGINEERING LIMITED - 55 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
22. CONTRACT ASSETS
2021
£
2020
£
Supply, design and installation of closed circuit television and
surveillance systems services
8,439,488
6,243,276
The contract assets primarily relate to the Company’s right to consideration for work completed and not billed
because the rights are conditioned on the Company’s future performance in achieving specified milestones at the
reporting date on the comprehensive architectural services. The contract assets are transferred to trade
receivables when the rights become unconditional. The Company typically transfer contract assets to trade
receivables upon achieving the specified milestones in the contracts.
There was no retention monies held by customers for contract works performed at the end of each reporting
period. The Company classifies these contract assets as current because the Company expects to realise them in
its normal operating cycle.
The Company makes specific provision for contract assets whose credit risk are considered significantly
increased or identified as credit-impaired. For remaining balance of contract assets, the Company makes general
provision based on ageing analysis and project status.
As at 31 March 2021, the gross amount of contract assets was £8,530,832 (2020: £6,344,943) and the provision
of impairment was £91,344 (2020: £101,667).
The following table provides information about the Company’s exposure to credit risk and ECLs for contract
assets at the end of the reporting period:
2021
Gross
carrying
amount
£
Expected
loss rate
%
Loss
allowance
£
Expected
loss rate
%
2020
Gross
carrying
amount
£
Loss
allowance
£
Within 3 years
Over 3 years
-
100
8,439,488
91,344
-
91,344
-
100
6,243,276
101,667
-
101,667
8,530,832
91,344
6,344,943
101,667
No loss allowance was recognised in profit or loss during the years ended 31 March 2021 and 2020.
23. CASH AND BANK BALANCES
(a)
Cash and cash equivalents
Cash at bank and in hand
Deposits with banks
Less: restricted cash
2021
£
284,354
-
284,354
-
2020
£
679,186
301,052
980,238
(301,052)
Cash and cash equivalents in the statement of cash flows
284,354
679,186
UNIVISION ENGINEERING LIMITED - 56 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
23. CASH AND BANK BALANCES (CONTINUED)
(b)
Cash and bank balances are denominated in the following currencies:
Hong Kong dollar
Renminbi
United States dollar
Others
(c)
Restricted cash
2021
£
273,095
5,231
4,621
1,407
2020
£
970,936
5,904
2,544
854
At 31 March 2020, bank balance of £301,052 was restricted as bank deposits with maturities less than
three months. Such restricted bank balances were held for the purpose of the issuance of performance
bonds in respect of maintenance contracts undertaken by the Company.
At 31 March 2021, the effective interest rate on bank deposits was 0.2% (2020: ranged from 0.2% to 2.7%) per
annum.
24. TRADE AND OTHER PAYABLES
Current liabilities
Trade payables
Bills payable
Accruals and other payables
Non-current liabilities
Due to a related company (Note 30)
2021
£
2,109,753
1,272,233
1,797,186
2020
£
1,206,558
1,272,863
1,345,338
5,179,172
3,824,759
393,074
437,500
5,572,246
4,262,259
Trade and other payables are expected to be repaid within one year, other than the amount due to a related
company.
Bills payable carry interest at annual rate at the Hong Kong Best Lending Rate and are repayable within 90 days.
25. CONTRACT LIABILITIES
2021
£
2020
£
Supply, design and installation of closed circuit television and
surveillance systems services
1,572,245
1,316,446
Contract liabilities represent the Company’s obligation to transfer performance obligation to customers for
which the Company has received considerations from the customers.
Revenue recognised during the year ended 31 March 2021 that was included in the contract liabilities at the
beginning of the year was amounted to £1,316,446 (2020: £956,616).
UNIVISION ENGINEERING LIMITED - 57 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
26. LEASE LIABILITIES
The following table shows the remaining contractual maturities of the Company’s lease liabilities at the end of
the current year:
Within one year
In the second to fifth year
Less: Future finance charges
Present value of lease obligation
27. BANK BORROWINGS
Revolving loans
Present value of
minimum lease payments
2021
£
42,959
21,924
2020
£
213,288
70,877
64,883
284,165
Minimum
lease payments
2021
£
2020
£
44,744
23,276
68,020
(3,137)
222,031
72,444
294,475
(10,310)
64,883
284,165
2021
£
2020
£
561,535
682,486
The loans are denominated in Hong Kong dollar and carry interest at annual rate at 1.5% over Hong Kong
Interbank Offered Rate.
Details of securities are disclosed in note 33 to the financial statements.
28.
SHARE CAPITAL
Issued and fully paid:
383,677,323 ordinary shares of HK$55,033,572, translated at historical
rate
3,890,257
3,890,257
2021
£
2020
£
The Company has one class of ordinary shares which has no par value.
UNIVISION ENGINEERING LIMITED - 58 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
29. EMPLOYEE RETIREMENT BENEFITS
The Company operates a Mandatory Provident Fund scheme (the “MPF scheme”) under the Hong Kong
Mandatory Provident Fund Schemes Ordinance for employees employed under the jurisdiction of the Hong
Kong Employment Ordinance. The MPF scheme is a defined contribution retirement scheme administered by
independent trustees. Under the MPF scheme, the Company and its employees are each required to make
contributions to the scheme at 5% of the employees’ relevant income, subject to a cap of monthly relevant
income of HK$30,000. Contributions to the MPF scheme vest immediately.
Saved as set out above, the Company has no other material obligations to make payments in respect of
retirement benefits of the employees.
30. RELATED PARTY TRANSACTIONS
Compensation of key management personnel
The remuneration of the key management personnel of the Company during the year was as follows:
Salaries, bonus and allowances
2021
£
2020
£
320,660
560,115
The remuneration of key management personnel comprises the remuneration of Executive Directors and key
executives.
Executive Directors include the Executive Chairman, Chief Executive Officer and Finance Director of the
Company. The remuneration of the Executive Directors is determined by the Remuneration Committee having
regard to the performance of individuals, the overall performance of the Company and market trends. Further
information about the Remuneration Committee and the Directors’ remuneration is provided in the
Remuneration Report and the Report on Corporate Governance to the Annual Report and note 11 to the financial
statements.
Key executives include the Director of Operations, Software Development Manager and Sales Manager of the
Company. The remuneration of the key executives is determined by the Executive Directors annually having
regard to the performance of individuals and market trends.
Biographical information on key management personnel is disclosed in the Directors’ and Senior Management’s
Biographies section of the Annual Report.
Transactions with related parties
(a) At 31 March 2021, there are balances of £284,072 (2020: £406,007) due from Mr. Stephen Sin Mo KOO
respectively, a Director of the Company, which are unsecured, interest-free and repayable on demand
(Notes 21).
(b) At 31 March 2021, there is a payable balance of £393,074 (2020: £437,500) due to a shareholder,
Univision Holdings Limited, which is unsecured, interest-free and repayable after 12 months (Note 24).
(c) At 31 March 2021, there are receivable balances of £2,842,805 (2020: £3,157,799) due from related
companies controlled by common shareholders of the Company, which are guaranteed by a shareholder
of the Company, interest-free and repayable after 12 months.
Apart from the transactions disclosed above and elsewhere in these financial statements, the Company had no
other material transactions with related parties during the year.
UNIVISION ENGINEERING LIMITED - 59 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
31. CASH FLOWS FROM LIABILITIES ARISING FROM FINANCING ACTIVITIES
The table below details changes in the Company’s liabilities arising from financing activities, including both
cash and non-cash changes. Liabilities arising from financing activities are liabilities for which cash flows were,
or future cash flows will be, classified in the Company’s statement of cash flows as cash flows arising from
financing activities.
At 1 April 2019
Financing cash flows:
New bank loans
Interest paid
Capital element of lease liabilities paid
Interest element of lease liabilities paid
Other changes:
New leases
Interest on lease liabilities
Interest expense on bank borrowings
Foreign translation difference
At 31 March 2020 and 1 April 2020
Financing cash flows:
Repayment of bank loans
Interest paid
Capital element of lease liabilities paid
Interest element of lease liabilities paid
Other changes:
New leases
Lease modification
Interest on lease liabilities
Interest expense on bank borrowings
Foreign translation difference
Amount due to
a related
company
£
Bank
borrowings
£
Lease
liabilities
£
Total
£
409,556
-
280,492
690,048
-
-
-
-
-
-
-
27,944
659,606
(21,205)
-
-
-
-
21,205
22,880
-
-
(172,201)
(12,537)
157,254
12,537
-
18,620
659,606
(21,205)
(172,201)
(12,537)
157,254
12,537
21,205
69,444
437,500
682,486
284,165
1,404,151
-
-
-
-
-
-
-
-
(44,426)
(54,355)
(12,805)
-
-
-
-
-
12,805
(66,596)
-
-
(177,430)
(7,043)
35,163
(58,138)
7,043
-
(18,877)
(54,355)
(12,805)
(177,430)
(7,043)
35,163
(58,138)
7,043
12,805
(129,899)
At 31 March 2021
393,074
561,535
64,883
1,019,492
Amounts included in the statement of cash flows for cash outflows for leases comprise the following:
Within:
Operating cash flows
Financing cash flows
These amounts relate to the following:
Lease rentals paid
2021
£
86,680
184,473
2020
£
54,411
184,738
271,153
239,149
2021
£
2020
£
271,153
239,149
UNIVISION ENGINEERING LIMITED - 60 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
32. COMMITMENTS
Capital commitments
At 31 March 2021, the Company did not have any material outstanding capital commitments.
33. BANKING FACILITIES
At 31 March 2021, the banking facilities of the Company were as follows:
(a)
(b)
(c)
The revolving trade financing facilities amounted to £2,433,318 (equivalent to HK$26,000,000) and
carried annual interest at the Hong Kong Dollars Best Lending Rate with a repayment term of 90 days.
The facilities are subject to the fulfilment of certain covenants relating to the Company’s net worth and
the loans to its related parties. If the Company is in breach of the covenants, the facilities would become
payable on demand. At 31 March 2021, the facilities were utilised to the extent of £1,272,233.
The revolving term facilities amounted to £1,403,837 (equivalent to HK$15,000,000) were secured by
floating charges over the bills receivable from the Company’s major customer. At 31 March 2021, no
facilities were utilised.
The revolving term facilities amounted to £613,184 (equivalent to HK$6,551,867) were secured by the
life insurance policy of the Company (Note 19). At 31 March 2021, the facilities were utilised to the
extent of £561,535.
(d)
The straight line loans facilities amounted to £842,302 (equivalent to HK$9,000,000) were secured by the
life insurance policy of the Company. At 31 March 2021, no facilities were utilised.
At 31 March 2020, the banking facilities of the Company were as follows:
(a)
(b)
(c)
(d)
(e)
The revolving trade financing facilities amounted to £2,187,500 (equivalent to HK$21,000,000) and
carried annual interest at the Hong Kong Dollars Best Lending Rate with a repayment term of 90 days.
The facilities are subject to the fulfilment of certain covenants relating to the Company’s net worth and
the loans to its related parties. If the Company is in breach of the covenants, the facilities would become
payable on demand. At 31 March 2020, the facilities were utilised to the extent of £1,272,863.
The revolving term facilities amounted to £2,604,167 (equivalent to HK$25,000,000) were secured by
floating charges over the bills receivable from the Company’s major customer. At 31 March 2020, no
facilities were utilised.
The revolving loans facilities amounted to £682,486 (equivalent to HK$6,551,867) were secured by the
life insurance policy of the Company (Note 19). At 31 March 2020, these facilities were fully utilised.
The bonding line facilities amounted to £2,083,333 (equivalent to HK$20,000,000) were secured by a
charge over deposits limited to £625,000 (equivalent to HK$6,000,000) granted by the Company. At 31
March 2020, no facilities were utilised.
The banking facilities for issuance of letter of credit and guarantee amounted to £301,052 (equivalent to
HK$2,890,100) were secured by a charge over a fixed deposit of £301,052 (equivalent to HK$2,890,100)
granted by the Company. At 31 March 2020, no facilities were utilised.
The Company regularly monitors its compliance with these covenants. Further details of the Company’s
management of liquidity risk are set out in note 6(b)(iii) to the financial statements.
UNIVISION ENGINEERING LIMITED - 61 - ANNUAL REPORT 2021
UNIVISION ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 31 March 2021
34. Contingent liabilities
On 14 December 2020, the Company received a writ of summons stating that it is being sued by Dimension
Data China Hong Kong Limited (“Dimension Data”), and Dimension Data is alleging breach of contract on part
of the Company and claiming against the Company for liquidated damages that Dimension Data has thereby
suffered in the amount of HK$10,953,969 plus pre-judgment and post-judgment interest and legal costs. The
Company, on the other hand, is defending the claim by alleging wrongful breach and thus repudiation of the said
sub-contract by Dimension Data and counter-claiming against Dimension Data for loss and damages to be
assessed and legal costs.
As of the date of this report, there is no mediation between the Company and Dimension Data.
The Company is of the opinion that the claim is highly opportunistic and without merit and the management
intends to defend this claim rigorously.
In the opinion of directors of the Company, there were no other significant contingent liabilities from pending
litigation or legal claims as at 31 March 2021.
35. MAJOR NON-CASH TRANSACTION
During the year, the final dividend for the year ended 31 March 2020 payable to the shareholder, Mr. Stephen
Sin Mo KOO, of £142,190 (2020: £145,338) was set-off against with other receivables.
36. EVENTS AFTER THE REPORTING PERIOD
On 19 August 2021, the Board of Directors proposed a final dividend for the year ended 31 March 2021. Further
details are disclosed in note 15(i) to the financial statements.
In 19 April 2021, an additional life insurance plan ("keyman insurance plan") for the Group's Executive
Chairman, Mr. Stephen Sin Mo KOO was provided by HSBC Life (International) Limited with sum insured of
US$2.5million. HSBC has provided a long term loan of approximately HK$7.1million for financing certain
portion of the premium. The Company is the policy holder for the keyman insurance plan that is assigned to
HSBC for security for the banking facilities.
UNIVISION ENGINEERING LIMITED - 62 - ANNUAL REPORT 2021
NOTICE OF ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN THAT the 2021 Annual General Meeting (AGM) of UniVision Engineering
Limited will be held at UniVision Engineering Limited, Unit 201, 2/F., Sunbeam Centre, 27 Shing Yip Street,
Kwun Tong, Kowloon, Hong Kong, on 30 September 2021 at 5:00 p.m. The following businesses will be
transacted then:
As ordinary business:
1. To receive and adopt the Company’s audited financial statements for the financial year ended 31 March 2021
together with the Directors’ Report and the Independent Auditor’s Report;
2. To declare a final dividend for the financial year ended 31 March 2021;
3. To re-elect Mr. Stephen Sin Mo KOO who retired by rotation, as a Director of the Company;
4. To re-elect Mr. Danny Kwok Fai YIP who retired by rotation, as a Director of the Company;
5. To re-elect Mr. Nicholas James LYTH who retired by rotation, as a Non-Executive Director of the Company;
6. To re-elect Mr. Ivor Colin SHRAGO who retired by rotation, as a Non-Executive Director of the Company;
7. To reappoint auditor PKF Hong Kong Limited, Certified Public Accountants, as auditors of the Company, to
hold office from the conclusion of the meeting to the conclusion of the next meeting, during which accounts
will be laid before the Company and to authorize the Directors to adjust their remuneration packages;
8. That the directors of the Company be and are hereby generally and unconditionally authorized to exercise all
powers of the Company to allot ‘Ordinary Shares’ the capital of the Company.
9. That the directors of the Company be and are hereby generally and unconditionally authorized to exercise all
powers of the Company to repurchase the ’Ordinary Shares’ in the capital of the Company, including any
form of depositary receipt.
By Order of the Board Registered office:
Mr. Stephen Sin Mo KOO Unit 201, 2/F Sunbeam Centre,
Executive Chairman 27 ShingYip Street
Kwun Tong, Kowloon,
6 September 2021 Hong Kong.
UNIVISION ENGINEERING LIMITED - 63 - ANNUAL REPORT 2021
NOTICE OF ANNUAL GENERAL MEETING
NOTES:
1. Only holders of Ordinary Shares, or their duly appointed representatives, are entitled to attend and vote
at the Annual General Meeting. A member so entitled may appoint one or more proxies (whether they
are members or not) to attend and, on a poll, to vote in place of the member.
2. A form of proxy is enclosed with this notice. To be valid, the form of proxy and any power of attorney
or other authority (if any) under which it is signed, or a notarized and certified copy of that power of
authority, must be lodged with the Company’s registrars, c/o Computershare Investor Services Plc., The
Pavilions, Bridgwater Road, Bristol BS99 6ZY, not less than 48 hours before the Annual General
Meeting takes place.
3. Completion and return of a proxy does not preclude a member from attending and voting at the Annual
General Meeting.
4. The Company pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001 specifies that
only those shareholders registered in the Register of Members of the Company as of 28 September 2021
are entitled to attend or vote at the Annual General Meeting in respect to the number of shares registered
in their name at that time. Changes to entries on the Register after that time will be disregarded when
determining the rights of any person to attend or vote in the Annual General Meeting.
UNIVISION ENGINEERING LIMITED - 64 - ANNUAL REPORT 2021